Gold Coast RE 1001 Cram, Practice Math and Final Exam with complete solutions 2024, Exams of Nursing

Download Gold Coast RE 1001 Cram, Practice Math and Final Exam with complete solutions 2024 and more Exams Nursing in PDF only on Docsity! 1 Gold Coast RE 1001 Cram, Practice Math and Final Exam with complete solutions 2024 312. Florida has established three authorized brokerage relationships. Unless otherwise established by agreement, what is the broker's relationship with the public? a. Nonrepresentation b. Single agency c. Dual agency d. Transaction brokerage - Answer- D. Transaction brokerage 242. A broker has been found guilty of mail fraud by a court and sent to jail. The broker's license will: a. Automatically be revoked b. Automatically be suspended c. Probably be revoked because of the conviction d. Be renewed while he is in jail - Answer- C. Probably be revoked because of the conviction 4. What is it called when a developer gives land to a governmental body? a. Eminent domain b. Condemnation c. Lis pendens d. Dedication - Answer- D. dedication 5. What business is a licensee engaged in who markets, leases and maintains property for someone else? a. Property management b. Business brokerage c. Universal agency d. Estoppel - Answer- A. property management 6. In which service of real estate must a licensee disclose the agency relationship and the responsibilities of that relationship to the public? a. Residential sales b. Residential leasing c. Real estate appraisals d. Real estate auctions - Answer- A. residential sales 2 7. Which power authorizes the FREC to pass or revise rules? a. Ministerial powers b. Quasi-executive c. Quasi-judicial d. Quasi-legislative - Answer- D. quasi-legislative 8. All of the following would be grounds for suspension or revocation of a real estate license, EXCEPT: a. Not giving the proper agency disclosure b. Falsifying information on a license application c. Not being a resident of Florida d. False advertising - Answer- C. not being a resident of Florida 9. Sandy works as a sales associate for a broker and has been asked to work weekends for a developer to sell new homes on commission. What must Sandy do to work for the developer? a. Transfer her license from the broker to the owner-developer b. Notify the broker where she can be found on weekends c. Contact the state and be issued a group license d. Contact the state and be issued multiple licenses - Answer- A. transfer her license from the broker to the owner developer 10. What does the license law require that a licensee complete before the first renewal of a Florida real estate license? a. A continuing education course b. A minimum number of transactions c. A post-licensing course d. A REALTOR® orientation course - Answer- C. post-licensing course 11. In a brokerage corporation, the officers and directors can be active or inactive brokers or nonlicensed registered persons. If someone who is nonlicensed and registered wants to become a broker, what must he or she do? a. File an application with the secretary of state b. Only take a 40-question law exam c. Qualify for a broker license in the same way as anyone else d. Demonstrate 2 years of experience in the real estate business - Answer- C. Qualify for a broker license in the same way as anyone else. 5 b. His license is null and void. c. He must complete 42 hours of continuing education. d. He must complete 45 hours of post- license education. - Answer- B. His license is null and void 23. A real estate broker has entered into a single agency relationship with the sellers of a three-bedroom, two-bath house. One of the agents in that broker's office has found an investor wanting to hire the brokerage firm as a single agent. For the investor to be shown this seller's house: a. The broker can work as a dual agent for both the buyer and the seller. b. This would be legal as long as the broker assigns a designated agent for each party. c. The seller must be informed that the brokerage firm is representing the buyer. d. Both the seller and the investor must agree to transition to transaction broker status. - Answer- D. Both the seller and the investor must agree to transition to transaction broker status 24. What must be given to a seller who is about to enter into a fiduciary relationship with a brokerage firm? a. Single Agency Notice b. Transition to Transaction Broker Notice c. Transaction Broker Notice d. No Brokerage Relationship Notice - Answer- A. Single Agency Notice 25. What should a sales associate do if his employing broker instructs him or her not to show properties to people of a certain race? a. Ignore the broker's instruction b. Follow the broker's instruction c. Ask the broker to put the instruction in writing d. Find a new employer - Answer- D. find a new employer 26. Which form requires the signature of all parties? a. No Brokerage Relationship Notice b. Transaction Broker Notice c. Single Agent Notice d. Transition to Transaction Broker - Answer- D. transition to transaction broker 27. In which instance must the agency disclosure forms developed by the state be used? a. Commercial leasing b. Residential leasing 6 c. Residential sales d. Residential auctions - Answer- C. Residential sales 28. Which duty does a broker owe to a customer? a. Full disclosure b. Avoid adverse interests c. Obedience d. Disclose known facts affecting the value of residential property - Answer- D. Disclose known facts affecting the value of residential property. 29. What must all advertising of listed property contain? a. Name of the sales associate b. Telephone number for the brokerage firm c. Name of the brokerage firm d. Telephone number of the sales associat - Answer- C. name of the brokerage firm 30. Sales associate Glenn works for broker John. If Glenn receives an escrow deposit on Tuesday, what should he do? a. Deliver it to his broker by Friday (third business day) b. Hold deposit until contract is accepted c. Deliver it to his broker immediately (next business day) d. Deliver it to his escrow account immediately - Answer- C. deliver it to his broker immediately (next business day) 31. A broker may hold escrow deposits in any of the following, EXCEPT: a. A savings association b. A commercial bank c. A credit union d. A mutual fund - Answer- D. mutual fund 32. To whom do listings obtained by a sales associate belong? a. The employing broker b. The listing sales associate c. The multiple listing service d. The local association of REALTORS® - Answer- A. The employing broker 33. A broker sells a rental list to a prospective tenant for $200. In a written agreement, the broker states that the fee is nonrefundable. This is: 7 a. Legal because it was disclosed in advance b. Illegal under F.S. 475 c. Legal but not ethical d. Legal because the fee was less than $500 - Answer- B. illegal under FS 475 34. A sales associate wants to use a trade or fictitious name. Which statement applies? a. The name must be registered with the county clerk. b. The name must be registered with FREC. c. This would violate F.S. 475. d. The name must be registered with the Secretary of State - Answer- C. This would violate FS 475 35. Jim is a sales associate applicant but has failed the state exam twice. After reviewing his most recent exam, he feels that some of the questions he missed were really correct and marked wrong in error. What may Jim do? a. File a complaint against the testing company b. Request a retest at no charge c. File a written objection to the questions during the scheduled question review d. Request an informal hearing before FREC - Answer- C. File a written objection to the questions during the scheduled question review 36. Craig is a real estate sales associate working for ABC Realty, Inc. Craig decides to have refrigerator magnets made to give out to the public. What must he include on the magnets? a. Since Craig is paying for them, he can put anything he wants on them. b. They must contain Craig's license status. c. They must contain the name ABC Realty, Inc. d. They must contain the word REALTOR® or broker. - Answer- C. they must contain the name ABC Realty, Inc 37. A borrower applied for and received an adjustable rate mortgage (ARM). The interest rate increased more than the periodic cap would allow. The new payment does not cover the full interest that is added to the principal balance and deferred. What is this called? a. Negative amortization 10 b. $50,000 c. $25,000 d. $15,000 - Answer- A. $150,000 50. What charge may be filed against a broker who fails to pay his or her sales associate? a. Culpable negligence b. Concealment c. Commingling d. Conversion - Answer- D. conversion 56. Which is correct according to the Florida Landlord and Tenant Act? a. Deposits may be held in an interest- bearing account, and the landlord keeps the interest. b. Deposits may not be held in a non- interest-bearing account. c. Deposits may be commingled into the landlord's personal account, provided the landlord has posted a surety bond with a notary public. d. Landlord must inform tenant within 30 days how the deposit is being held. - Answer- D. Landlord must inform tenant within 30 days how the deposit is being held 57. A developer advertises homes for sale with a total down payment of $1,500. The developer knows that all of the houses with that amount of down payment have been sold. Is this transaction covered under truth-in-lending laws? a. No, because the advertising was done by a builder/developer, not a broker b. Yes, because this is bait and switch advertising and is illegal c. No, because single-family residence is exempt from regulation z d. Yes, because this is puffery and is illegal - Answer- B. Yes, because this is bait and switch advertising and is illegal 58. What is the main purpose of Regulation Z? a. Require lenders to disclose the true cost of credit to consumers b. Require lenders to disclose closing costs to borrowers c. Require brokers to disclose closing costs to buyers d. Require sales associates to disclose commissions to customers - Answer- A. Require lenders to disclose the true cost of credit to consumers 59. Under the Truth in Lending Act, in credit advertising, which would not be considered a "triggering term"? 11 a. $1,500 down b. Easy terms c. 6% interest d. 10% down - Answer- B. Easy terms 60. A broker receives a kickback or referral fee from a title insurance company. This practice is: a. Legal b. A violation of RESPA c. Legal; however, not recommended d. Illegal; however, FREC will allow it to continue as long as the broker is active - Answer- B. A violation of RESPA 53. A licensee picks the properties a particular buyer is shown based on the race of the buyer. What is this illegal act? a. Redlining b. Blockbusting c. Steering d. Commingling - Answer- C. Steering 54. Telling home owners that minority families are moving into their neighborhood in an attempt to get them to sell their home and move is referred to as which of the following? a. Steering b. Redlining c. Blockbusting d. Boycotting - Answer- C: Blockbusting 55. Broker Bill has been hired to rent Mrs. Brown's apartment building located in a large college town. Broker Bill quotes lower rents and deposits to females because he has found through experience that they will cause less trouble than males, and females will maintain their apartments in much better condition. This is: a. True and therefore no problem b. A violation of the Civil Rights Act of 1866 c. A violation of the Equal Rental Opportunity Act of 1972 d. A violation of the Fair Housing Act of 1968 - Answer- D. A violation of the Fair Housing Act of 1968. 52. What law requires that buyers be given a good faith estimate of closing costs prior to closing? 12 a. Florida Statute 475 b. Truth-in-Lending Act c. Sherman/Clayton Antitrust Act d. RESPA - Answer- D. RESPA 51. The Fair Housing Act of 1968 (as amended) prohibits discrimination based upon: a. Race, color, citizenship, sex, family status, or religion b. Race, color, religion, sex, age, national origin, or handicap c. Race, color, religion, sex, national origin, family status, or handicap d. Race, color, age, residency, sex, national origin, or handicap - Answer- C. Race, color, religion, sex, national origin, family status or handicap 61. A property that borders a river or stream includes which rights? a. Allodial b. Alluvial c. Littoral d. Riparian - Answer- D. Riparian 72. What term refers to the power that the government has to take land for the public good? a. Encumbrance b. Escheat c. Eminent domain d. Easement - Answer- C. eminent domain 62. The courts usually apply legal tests to determine if personal property has become a fixture. Which of the following is included in those tests? a. Date of purchase b. Extent of the parties c. Relationship of the parties d. All of the above - Answer- C. Relationship of the parties 63. An owner of a piece of real estate has purchased the materials to fence the backyard. What type of property is the fencing material? a. Trade fixture b. Real estate 15 d. Notarizing the documents of transfer - Answer- B. Possession of the property that can be seen and heard 75. Complete the sentence. A deed must be: a. Notarized b. Witnessed c. Recorded d. Signed by the grantee - Answer- B. witnessed 76. How is a quitclaim deed most often used? a.Asataxdeed b. As a way to clear clouds on title c. As a personal representative's deed d. As a guardian's deed - Answer- B. As a way to clear clouds on title 78. What is the purpose of a title search? a. Locate all important documents for a closing b. Issue title insurance c. Give constructive notice d. Run a chain of title - Answer- D. run a chain of title 79. What is a title? a. A deed of conveyance b. A legally binding contract c. A piece of paper d. A bundle of ownership rights - Answer- D. A bundle of ownership rights 80. Private restrictions are enforced by private citizens. Which of the following is the strongest control they have over a property owner? a. Leases b. Easements c. Deed restrictions d. Liens - Answer- C. deed restrictions 82. Which deed contains no warrants or promises? a. General warranty deed b. Bargain and sale deed c. Special warranty deed d. Quitclaim deed - Answer- D. Quitclaim deed 16 83. If an owner dies intestate with no known heirs, how can the state can take the property? a. Elective share b. Dower rights c. Eminent domain d. Escheat - Answer- D. Escheat 84. How many acres does the following legal description contain? The S 1/2 of the SW 1/4 of the NW 1/4 and the N 1/2 of the NW 1/4 of the SW 1/4 of a Section a. 20 b. 40 c. 625 d. 640 - Answer- B. 40 85. The southeast corner of Section 31, Township 1 North, Range 3 West, is how many miles from Tallahassee? a. 17 b. 18 c. 23 d. 24 - Answer- A. 17 86. The horizontal strip of land 6 miles wide immediately north of the Tallahassee baseline would be: a. Township 1 East b. Section 1 North c. Range 1 North d. Township 1 North - Answer- D. Township 1 North 126. What method can be used to depreciate residential real estate purchased after 1986? a. 27.5 years straight-line b. 39 years straight-line c. 27.5 years double declining d. 39 years double declining - Answer- A. 27.5 years straight-line 88. Which action can terminate a contract? a. Novation 17 b. Performance c. Rejection d. Subrogation - Answer- B. performance 89. Which item is an essential element of a sales contract? a. An offer and acceptance b. Witnesses c. A notary seal d. An earnest money deposit - Answer- A. an offer and acceptance 90.. What does the Statute of Frauds require? a. Lawsuits about oral contracts must be filed within 4 years b. All contracts must be in writing c. To be enforceable, a contract transferring an interest in real estate must be in writing d. Violations are punishable by fines not to exceed $1,000 - Answer- C. To be enforceable, a contract transferring an interest in real estate must be in writing 91. What is stated in the Statute of Limitations? a. The sentencing guidelines for violations of the law b. The time frame in which a contract can be enforced c. To be enforceable, real estate contracts must be written d. Contracts must be notarized to be enforceable - Answer- B. The time frame in which a contract can be enforced 92. The essential elements of a contract include all of the following, EXCEPT: a. Consideration b. Offer and acceptance c. Competent parties d. Notarized - Answer- D. Notarized 93. In states which operate under title theory, the borrower: a. Transfers ownership to the mortgagee or a third party until paid b. Transfers possession to the mortgagee or a third party until paid c. Pledges the property as security on the loan d. Creates a tenancy in common with the lender - Answer- A. transfers ownership to the mortgagee or a third party until paid 20 a. The borrower will obtain title only after the loan is paid. b. Foreclosure will take place much quicker than in title theory states. c. The borrower conveys title to the lender using a deed of trust. d. The mortgage serves as a lien against the property. - Answer- D. The mortgage serves as a lien against the property 106. Which of the following is a characteristic of an amortized or level payment mortgage? a. The early payments are mostly interest b. The early payments are mostly principal c. Each monthly payment increases and the balance decreases d. With each monthly payment, the interest increases and the balance decreases - Answer- A. the early payments are mostly interest 107. Which term refers to the process of sand deposits building up over time, causing an increase in land? a. Reliction b. Accretion c. Erosion d. Alluvion - Answer- B. Accretion 108. Which estate or tenancy is the most comprehensive? a. Fee simple b. Life estate c. Estate for years d. Free sample estate - Answer- A. Fee simple 109. Which term refers to the government's right to limit or control the actions of citizens in the form of such things as zoning codes and building codes? a. Police power b. Eminent domain c. Escheat d. Taxation - Answer- A. Police power 127. What is the name for the annual income that an investment property could make with no vacancies or collection losses? 21 a. Annuity gross income b. Effective gross income c. Net operating income d. Potential gross income - Answer- D. Potential gross incomes 111. Which term refers to the interest that is charged when banks borrow from the Federal Reserve? a. Prime rate b. Discount points c. Usury rate d. Discount rate - Answer- D. Discount rate 112. If a lender charges 8% interest plus 2 points, what is the approximate yield on the loan? a. 9.00% b. 8.50% c. 8.25% d. 8.13% - Answer- C. 8.25% 113. The primary purpose of the Federal Home Loan Bank System is to provide support for which of the following? a. Savings associations b. Federal commercial banks c. Mortgage brokers d. Insurance companies - Answer- A. Savings associations 114. Which characteristic applies to the note documentary stamp tax? a. Paid by the seller b. $.70 per $100 c. .002 of the loan amount d. $.35 per $100 - Answer- D. $.35 per $100 115. What would the Federal Reserve do when it wants to increase the supply of loanable funds? a. Sell government securities b. Increase the reserve requirement c. Increase the discount rate d. Decrease the reserve requirement - Answer- D. Decrease the reserve requirement 116. When is intermediation in financial institutions most likely to occur? 22 a. When demand and supply of funds are both decreasing b. When demand and supply of funds are both increasing c. When supply of funds is decreasing, and the demand is increasing d. When supply of funds is increasing, and the demand is decreasing - Answer- D. When supply of funds is increasing, and the demand is decreasing 128. What is a contract for deed, or land contract? a. A type of ownership or tenancy b. A legal document that conveys title c. A purchase and sale contract for unimproved land d. A form of owner financing - Answer- D. A form of owner financing 129. What is required for a person who represents him or herself as a business broker? a. A business sales associate's license b. A business broker's license c. An appraiser's license d. A real estate license - Answer- D. A real estate license 130. Which term refers to the tangible and intangible resources of a business? a. Liabilities b. Net worth c. Owner's equity d. Assets - Answer- D. Assets 131. Which asset is the most difficult to set a dollar value on for a business? a. A leasehold estate b. Existing equipment c. Corporate stock d. Goodwill - Answer- D. Goodwill 132. John has the opportunity to invest in a property with a 9% return. He can borrow the money at an interest rate of 7%. Which investment characteristic exists? a. Liquidity b. Negative leverage c. Neutral leverage 25 a. File for the exemption each year b. File for the exemption only once c. Live in the house all year d. Live in the house at least 6 months of the year - Answer- A. File for the exemption each year 146. All of the following are characteristics of real estate, EXCEPT: a. The market is local in nature. b. The market is slow to respond to changes in supply and demand. c. There is no central control over the market. d. The market is homogenous. - Answer- D. The market is homogenous 147. What is the purpose of building codes? a. To set standards for the amount of land a building can cover b. To specify the style of building that may be built c. To regulate government properties d. To establish minimum standards of building design and construction - Answer- D. To establish minimum standards of building design and construction 148. What are the two most important financial summary statements of a business? a. Working capital and depreciation reports b. Balance sheet and income statement c. Cash flow and asset reports d. Tax returns and asset report - Answer- B. Balance sheet and income statement 149. In which market would there be a shortage of housing? a. Buyers' market b. Housing market c. Sellers' market d. Deficit market - Answer- C. Sellers' market 151. A lawn service company sold for $125,000. The tangible assets amounted to the lawn equipment valued at $48,000. The intangible assets were the customer base and the company's good reputation. What is the value of the intangible assets? a. $173,000 26 b. $77,000 c. $48,000 d. $38,500 - Answer- B. $77,000 152. A property manager of an office building leases 2,500 square feet of space to a doctor's office, which is 12.5% of the total space. What is the total square footage of the building? a. 20,000 b. 40,000 c. 100,000 d. 200,000 - Answer- A. 20,000 145. If an owner felt that a zoning rule was causing an economic hardship, not of his or her own making, he or she may seek relief by requesting a(an): a. Variance b. Site plan exemption c. Special use exemption d. Nonconforming use exemption - Answer- A. Variance 154. James, a potential buyer, is told by the lender that he can have a loan at an interest rate of 6%. When he goes to the closing, he notices that the Truth-in-Lending statement says the APR is 6.5%. Using the rule of thumb calculation, how many points were most likely charged? a. 3 b. 4 c. 5 d. 6 - Answer- B. 4 155. Carol is borrowing money to purchase her first home. The lender has agreed to a 5% loan with 2 discount points. What is the approximate yield on the loan? a. 3.00% b. 4.75% c. 5.25% d. 7.00% - Answer- C. 5.25% 156. Jack has an income of $85,000 per year, and Patricia, his wife, has an income of $75,000. They have car payments of $540 per month each, credit card payments of $600 and student loan payments of $1,000 per month. The loan they are applying for would have a monthly payment of $3,400. What is the housing expense ratio? a. 53% 27 b. 45% c. 38% d. 26% - Answer- D. 26% 157. What amount of the second monthly payment would be applied to principal on a $180,000 loan with an annual interest rate of 6.5% for 30 years, with payments of $1,137.72? a. $162.72 b. $163.60 c. $974.12 d. $975.00 - Answer- B. $163.60 150. Which financial statement shows the status of a business as of a specific date? a. Income statement b. Balance sheet c. Profit and loss statement d. IRS Form 1040 - Answer- B. Balance sheet 158. Sandy is purchasing a home for $570,000, with a down payment of $114,000. If she finances the difference, what is the loan-to-value ratio? a. 85% b. 80% c. 65% d. 60% - Answer- B. 80% 159. Sarah made an escrow deposit of $8,500 on her sales contract. The sale price is $200,000, and she has arranged for an 85% loan. If her closing costs are $6,000, how much additional cash must she bring to the closing? a. $21,500 b. $24,200 c. $27,500 d. $36,000 - Answer- C. $27,500 153. A homesteaded property has an assessed value of $249,000. If the county tax rate is 7 mills, the city is 8 mills and the school board is 9 mills, how much does the homestead exemption save the homeowner? a. $25,000 b. $6,000 c. $5,376 d. $975 - Answer- D. $975 30 d. 156.10 - Answer- B. 134.75 170. What is the gross income multiplier for an investment property that has a gross income of $550,000 and a net income of $330,000 if the value is $4,125,000? a. 3.4 b. 4.7 c. 7.5 d. 12.5 - Answer- C. 7.5 171. If a lot measures 125 feet by 225 feet, and the street in front is scheduled to be paved at a cost of $100 per front foot, how much would one homeowner's special assessment be if the county is paying 30%? a. $1,875 b. $2,187 c. $4,375 d. $7,875 - Answer- C. $4,375 173. An investor purchased an office building for $655,000, with acquisition costs of $42,300. If the building represents 80% of the cost, what is the annual IRS depreciable allowance? a. $14,303.59 b. $16,794.87 c. $23,818.18 d. $25,356.36 - Answer- A. $14,303.59 174. A comparable property recently sold for $429,000. The comparable property is built of superior materials valued at $25,000 but has less square footage than the subject property, valued at $35,000. What is the adjusted sale price of the comparable property? a. $369,000 b. $419,000 c. $439,000 d. $489,000 - Answer- C. $439,000 175. A homeowner purchased a primary residence for $395,500 including $15,000 in closing costs and $60,000 for the lot. After the closing, hurricane shutters were installed at a cost of $12,600. What is the adjusted basis for tax purposes? a. $348,100 31 b. $423,100 c. $382,900 d. $408,100 - Answer- D. $408,100 176. Who may be compensated, directly by an owner, for performing any of the eight services of real estate? a. Broker b. Sales associate, if employed by an owner-developer c. Principal d. Both a and b - Answer- D. Both a and b 177. A, B, and C bought 640 acres of land with equal and undivided interest. A and B were brokers, and C was not. A and B were frequent business partners but decided to let C handle the resale of the tract. C had very little experience but was able to find a buyer willing to pay a good price. Because of this, A and B decided to give C 40% of the profits and divide equally the balance of the profit. Which applies? a. C can do this if C is an attorney b. C can do this because A and B are brokers c. F.S. 475, has been violated d. Since C is selling C's own land, C does not have to be registered - Answer- C. F.S. 475, has been violated 178. Jerry was notified that he passed the state sales associate license exam. For which type of employer does his license allow him to perform real estate services? a. A broker b. An owner-developer c. A real estate brokerage corporation d. A, b or c - Answer- D. A, b or c 179. Owner A and friend B meet on the street. A says, "I would like to sell my house." B takes the information and says "I'll find you a buyer; I've done it several times for our friends." B finds a buyer for A's house, and the transaction is closed. Based on the above facts, which of the following applies? a. A has violated F.S. 475 b. B has violated F.S. 475 c. Both A and B have violated F.S. 475 d. Neither have violated F.S. 475 - Answer- D. Neither have violated F.S. 475 180. The requirements for obtaining a Florida real estate license include all of the following, EXCEPT: 32 a. Passing two exams b. Having a high school diploma or equivalency c. Completing a pre-licensing course d. Being a Florida resident - Answer- D. Being a Florida resident 181. Mary does not have a real estate license and works for AAA Syndicate, which buys, sells, manages, and leases its own property. Mary was hired to lease and sell AAA's property; she is compensated by a salary. Which statement is correct? a. Mary needs a real estate license. b. This activity is okay only if Mary is paid 50% on sales and 50% on leasing. c. There is no violation of F.S. 475. d. This activity is okay only if no - Answer- C. There is no violation of F.S. 475 182. Which information is included in the public records? a. Real estate school test questions b. A licensee's test results c. A sales associate's application d. State exam answers - Answer- C. A sales associate's application 183. An owner of a service station who holds an inactive sales associate's license has been appointed by the court to appraise another service station. Which statement is most correct? a. Since he or she has registration status, that person may be compensated for this service of real estate. b. He or she must have an active license to be compensated. c. He or she may be compensated by a licensed broker. d. He or she may be compensated directly for this service. - Answer- D. He or she may be compensated directly for this service 184. What must a sales associate do to be eligible to take the broker examination? a. Be employed by one or more actively licensed brokers for at least 24 months within the preceding 5 years b. Work for one broker for at least 12 months as an active sales associate c. Have a total of 1 year as an active sales associate with a broker or owner- developer within the last 5 years d. Prove that they have been actively 35 193. Robert, a sales associate, has been working with an investor that is looking for single-family properties for income. In order to get preferential treatment, the investor offers a $1,000 finder's fee directly to Robert for each suitable property he finds. This arrangement would be: a. A violation of the civil rights laws b. Acceptable since it is a finder's fee, not a commission c. A violation since finder's fees cannot exceed $50 d. A violation of F.S. 475, because it is not paid through his broker - Answer- D. A violation of F.S. 475, because it is not paid through his broker 194. What should a sales associate do if he or she considers a rule to be invalid? a. Notify the state legislators b. Notify the local board of REALTORS® c. Notify FREC d. Ignore the rule - Answer- C. Notify FREC 195. Aaron Applicant has passed the state examination for becoming a sales associate. An hour later, Aaron has the opportunity to list his neighbor's house. Aaron may: a. List the house as long as he has an employing broker and both Aaron and the employing broker are properly registered on the records of the DBPR b. Not list the property until he has sent a copy of his pass slip and a copy of his employing broker's business tax receipt number to the Division of Real Estate for certification c. List the property as long as he has been properly preregistered with his new owner- developer, and the pass slip is physically in his possession d. Not list the property until he has joined and paid the required fees to the local Association of REALTORS® - Answer- A. List the house as long as he has an employing broker and both Aaron and the employing broker are properly registered on the records of the DBPR 196. Before the rules and regulations enacted by the FREC become effective, with which entity must they be filed? a. Attorney general b. Secretary of state c. Secretary of the senate d. Governor's office - Answer- B. Secretary of State 197. Which entity signs the certificates of the FREC meetings that reflect the actions of the Commission? 36 a. Secretary of state b. FREC chairperson or vice chairperson c. Chief investigator of the DRE d. Any FREC commissioner - Answer- B. FREC chairperson or vice chairperson 198. Which items would be optional on a branch office sign? a. Branch office name b. The words, "Licensed Real Estate Broker" c. The name of the business entity d. The name of an individual broker - Answer- A. Branch office name 199. Jeff is the owner of a building that is leased to Craig. If Jeff sells the building, what is the status of the lease? a. It becomes a tenancy at will b. It must be renewed c. It is terminated d. It is binding on the new owner - Answer- D. It is binding on the new owner 201. Sales associate, Tim, received a signed contract from a buyer and mailed it to the seller. The seller agreed to the terms and the escrow deposit was deposited safely in the broker's escrow account. Tim has a disagreement with his broker and quits. The broker refuses to pay a commission since Tim was not in his employ when the contract was actually received and signed. What should Tim do? a. Notify the state b. Sue the seller for his share c. Sue the broker d. Forget it; he or she is not entitled to the commission - Answer- C. Sue the broker 202. Who is the principal, or employer? a. The buyer b. The seller c. The one who engages the broker in a single agency relationship d. The one who pays the broker - Answer- C. The one who engages the broker in a single agency relationship 204. Sales associate John attends a cocktail party with his friend Bill, where he introduces Bill to another friend, Jack. It turns out that Jack has a house for sale, and 37 Bill agrees to purchase it. Sales associate John makes it clear that he wants no commission, but John's broker demands a commission. Which statement is correct? a. The broker is the procuring cause and is entitled to a commission. b. The broker should reduce his commission because of John's friendship. c. The broker is not entitled to a commission. d. The broker is entitled to a referral fee only. - Answer- C. The broker is not entitled to a commission 200. A sales associate went on vacation. While gone, the broker moved the office around the block. When the sales associate returned, there was an urgent message that two serious prospects had called. Also, a sale closed in his absence and the broker owes him a commission. What should the sales associate do first? a. Demand the commission b. Forget the commission since the sales associate wasn't there c. Call the two prospects immediately d. Immediately request a reissue of license from FREC - Answer- C. Call the two prospects immediately 205. A broker, while looking for a deal for his best friend, gets a listing. The seller must sell because of a family emergency. What should the broker say to his best friend? a. Say nothing about the seller, and ask the buyer to make an offer b. Tell the buyer that the seller must sell quickly so that he would probably accept any reasonable offer c. Give the buyer only the suggestion that the seller is motivated d. Tell the buyer that a dual agency exists - Answer- A. Say nothing about the seller, and ask the buyer to make an offer 206. If an oral offer is made to a broker on a property the broker has listed, what should be the broker's response? a. Demand that the offer be in writing b. Inform the buyer that the offer violates the statute of frauds c. Ask for a substantial deposit d. Submit the offer to the seller - Answer- D. Submit the offer to the seller 203. Homeowner Owen signed an exclusive right of sale listing with Bob, a registered broker. The listing states that Bob is employed to find a purchaser and that Owen agrees to pay a 10% commission to Bob or any person, partnership, corporation or firm that sells the property. The remainder of the listing deals with the terms and conditions of the sale and duration of the listing. While Owen was away on vacation, Percy made a 40 lower price. b. The broker must tell the buyer of the lower price. c. The broker can accept a $72,000 offer for the seller. d. either b or c - Answer- A. The broker cannot tell the buyer of the lower price 217. Complete the sentence. A fiduciary relationship is one of: a. Trust b. Confidence c. Trust and confidence d. Trust and confidence when accepted - Answer- D. Trust and confidence when accepted 218. Can a broker be entitled to two commissions when consummating an exchange? a. No, as this would be a conflict of interest b. Yes, providing both parties are advised and approve c. Yes, but only if both brokers agree d. No, since a broker can only have one principal - Answer- B. Yes, providing both parties are advised and approve 219. A seller-listed property at a price that the broker knew was below market value. The broker had his wife buy the property in her maiden name and subsequently resold the property at a profit. What could the broker be charged with? a. Nothing b. Concealment and fraud c. Alienation of affection d. Culpable negligence - Answer- B. Concealment and fraud 220. In a real estate transaction, what type of relationship can a buyer and seller expect to have? a. A fiduciary relationship b. A relationship of trust c. An arm's length relationship d. A relationship of confidence - Answer- C. An arm's length relationship 221. What is a licensee with full representation to both parties in the same transaction referred to as? a. Transaction broker 41 b. Single agent c. Dual agent d. Subagent - Answer- C. Dual agent 223. Which term refers to the misstatement, omission, or concealment of a factual matter? a. Misrepresentation b. Conspiracy c. Conversion d. Puffery - Answer- A. Misrepresentation 224. An Illinois corporation is transferring its employees to Florida. The firm retained a Florida broker to find homes for its employees. The attorney representing the Illinois corporation, notifies the Florida broker that in the state of Illinois, an attorney is recognized as a real estate broker. Therefore, the attorney wants a referral fee. What should the Illinois attorney do? a. Produce a certified statement to the Florida broker that Illinois attorneys are recognized as brokers b. Not expect a referral from the Florida broker c. Notify FREC prior to expecting any referral fee d. Expect to receive a referral fee because he is recognized as a broker in Illinois - Answer- D. Expect to receive a referral fee because he is recognized as a broker in Illinois 225. A licensed broker and one of his employed sales associates purchase a parcel of real estate together. What relationship have they formed? a. A joint venture b. A limited partnership c. A general partnership d. An illegal venture, since only brokers can be members of a real estate partnership - Answer- A. A joint venture 226. When moving from one branch office to another, what must a broker do? a. Send in the old branch office registration with a request for transfer b. Apply for and obtain a new registration for the new branch and pay the proper fee c. Change the address on his branch office registration certificate d. Be at least 5 miles from the main office - Answer- B. Apply for and obtain a new registration for the new branch and pay the proper fee 42 227. Broker A and Broker B are working exclusively for one developer on adjoining projects. They agree to hire a sales associate between them for a half week each. The sales associate: a. Must be licensed to both of them b. Must be licensed with the developer c. Must be registered with both the brokers and the developer d. Cannot have two registered employers - Answer- D. Cannot have two registered employers 228. Unless exempt, performing a service of real estate for someone else for compensation in Florida without an active license is considered to be which of the following criminal violations? a. Misdemeanor of the first degree b. Misdemeanor of the second degree c. Felony of the first degree d. Felony of the third degree - Answer- D. Felony of the third degree 229. Broker Davis, Broker Ben, and Broker Boone form a partnership. The partnership buys, develops, and sells land. Sales associate Jerry becomes an equal partner in the firm. A sale is made, resulting in a $40,000 profit. Which statement is correct? a. The partnership is illegal unless Jerry becomes broker. b. The partnership agreement must be filed with the Secretary of State. c. The profits may be divided equally. d. Jerry cannot receive any portion of the profit. - Answer- C. The profits may be divided equally 230. What must be included on a real estate brokerage sign? a. Sales associate's name b. Office phone number c. Brokerage firm's license number d. Name of the brokerage firm - Answer- D. Name of the brokerage firm 231. Six brokers wish to become partners in a real estate agency and each be active in real estate sales. What is required? a. That they register with the DBPR as inactive brokers b. That they all be licensed as active brokers c. That they have at least one active broker 45 writ of supersedeas. d. The secretary of the DBPR can issue a summary suspension. - Answer- D. The secretary of the DBPR can issue a summary suspension 243. What is the maximum allowable payment from the recovery fund for any financial losses suffered due to a licensee's acts? a. $25,000 b. $75,000 for multiple transactions c. $50,000 per transaction, with a maximum of $150,000 for multiple transactions d. Any amount equal to the losses - Answer- C. $50,000 per transaction, with a maximum of $150,000 for multiple transactions 244. Which court is the final court in the appeal process? a. Circuit court b. District court of appeals c. Florida Supreme Court d. Small claims court - Answer- C. Florida Supreme Court 245. A violation of F.S. 475 can result in any of the following actions, EXCEPT: a. Revocation b. Imprisonment c. Direct denial of compensation d. A fine of $10,000 per offense - Answer- D. A fine of $10,000 per offense 246. An investor lost $30,000.00 due to his broker's negligence. The investor sued the broker and awarded a judgment totaling $30,000.00. The broker went bankrupt, and the bankruptcy court forced the broker to pay the investor $8,000.00. What amount from the recovery fund may the investor obtain? a. $3,000 b. $10,000 c. $22,000 d. $25,000 - Answer- C. $22,000 247. If a licensee violates F.S. 475, the Commission is allowed to impose any of the following penalties, EXCEPT: a. Revoke the license b. Suspend the license c. Fine the licensee $10,000 d. Refuse to renew the license - Answer- C. Fine the licensee $10,000 46 248. If FREC imposed a fine and issued a final order, how much longer does the licensee have to pay the fine? a. 10 days b. 30 days c. 60 days d. 90 days - Answer- B. 30 days 250. A broker who is temporarily incapacitated in regard to his or her ability to act as a broker with regard to safety of the public will probably have which action taken? a. License revocation b. License suspension c. License made null and void d. Reprimand - Answer- B. License suspension 251. What is the maximum administrative fine for a violation of F.S. 475? a. $500 b. $1,000 c. $1,500 d. $5,000 - Answer- D. $5,000 252. A licensee becomes a convicted felon serving a prison term. The Commission: a. Would probably suspend the license for the length of the term b. Could revoke the license c. Will revoke the license d. Will suspend the license - Answer- B. Could revoke the license 253. A broker is sued for misrepresentation. The court awards the buyer $100,000 in damages. What kind of penalty is this? a. Civil b. Administrative c. Criminal d. Civic - Answer- A. Civil 254. What is the maximum time the license can be suspended on the first offense? a. 2 years b. 5 years c. 10 years 47 d. No suspension is likely on the first offense - Answer- C. 10 years 255. A licensee files a false affidavit to make a claim against a property. How is this criminal action classified? a. First-degree felony b. Second-degree felony c. First-degree misdemeanor d. Second-degree misdemeanor - Answer- B. Second-degree misdemeanor 256. A person being investigated by the Department of Business and Professional Regulation must be notified in all of the following situations, EXCEPT: a. There is probable cause that there may have been a violation of F.S. 475. b. There is probable cause that there may have been a violation of Chapter 61J2, F.A.C. c. The act that is under investigation is a criminal offense. d. The investigation is ordered by the DBPR. - Answer- C. The act that is under investigation is a criminal offense 257. Michael and Jerry are both brokers. They decide to share office space. They do not use a trade name or common letterhead, although they share a secretary. Prior to putting up their signs, Jerry defrauds a prospect who came into the office. Based on this information, which statement is correct? a. Michael and Jerry have committed estoppel. b. Michael and Jerry are general partners. c. Michael can be held responsible for Jerry's acts. d. Jerry alone is responsible for this fraud. - Answer- C. Michael can be held responsible for Jerry's acts 258. Broker Smith, in selling building lots, offers each buyer the opportunity to purchase, for $5.00, a chance in a lottery in which (if 20 lots are sold by the end of the week) the winner would be entitled to one-half off the price of his lot. At the end of the week, only 16 lots were sold, so Smith decided to return the entrants' $5.00. Which statement is true? a. Smith is in violation because he conducted a device, lottery, scheme, or trick. b. Smith is not in violation since the monies were returned. c. This is not a violation of F.S. 475. d. This would be a violation only if Smith in fact gave the discount to the winner of the lottery. - Answer- A. Smith is in violation because he conducted a device, lottery, scheme, or trick 50 267. Mrs. Murphy is a struggling small investor who owns a boarding house and rents rooms to tenants. Which statement is correct? a. She may advertise to attract tenants of a particular race or religion. b. She may refuse to rent to any tenant that she feels would be incompatible with existing boarders. c. She cannot refuse to rent to a boarder that she feels may be incompatible. d. Private owners are exempt from the Fair Housing Act - Answer- B. She may refuse to rent to any tenant that she feels would be incompatible with existing boarders 268. A private club has a lodge in the mountains. The club refuses to rent rooms in the lodge to certain minority groups. Which statement applies? a. This is a violation of the Fair Housing Act. b. This is a violation of the Civil Rights Act of 1968. c. Under the Fair Housing Act, they may restrict rentals to members of their own club. d. Under the Fair Housing Act, they may discriminate. - Answer- C. Under the Fair Housing Act, they may restrict rentals to members of their own club 269. All of the following are exempt from RESPA requirements, EXCEPT? a. A loan for the construction of a 10-unit apartment building b. A loan for a commercial property c. A loan to purchase a new home in a subdivision d. An all cash payment for a single-family home - Answer- C. A loan to purchase a new home in a subdivision 270. Who is exempt from provisions of the Fair Housing Act of 1968? a. Sales associates b. Brokers c. Mortgagees d. Homeowners who are selling their only single-family home as a FSBO - Answer- D. Homeowners who are selling their only single-family home as a FSBO 51 271. Which entity published Regulation Z? a. Federal Trade Commission b. Federal Housing Administration c. Board of Governors of the Federal Reserve System d. Department of Veterans Affairs - Answer- C. Board of Governors of the Federal Reserve System 272. A tenant is 2 months delinquent on the rent. What is the first step available to the landlord to remedy the situation? a. Disconnect the utilities b. Ask the sheriff to evict the tenant c. Ask the court for a writ of possession d. Post a 3-day notice to pay the rent or vacate - Answer- D. Post a 3-day notice to pay the rent or vacate 273. A broker can legally show homes based upon which requests? a. Caucasian neighborhood b. African American neighborhood c. Hispanic community d. retirement community - Answer- D. retirement community 274. A Hispanic buyer asks to see a home in a certain price range. What should a licensee show him? a. Homes in only a predominately-Hispanic area b. Homes in only a predominately- Caucasian area c. Six homes in each type of area d. Available homes in his price range, regardless of area - Answer- D. Available homes in his price range, regardless of area 275. Widow McFee found that her deceased husband left his entire estate, except for homestead, to his secretary. What can Widow McFee do? a. File for her dower share of one-third of all real property owned by her deceased husband b. File for an elective share of 30% of all real and personal property owned by her deceased husband c. File for 100% of his property under Florida's community property law d. Only file a civil suit to contest the will - Answer- B. File for an elective share of 30% of all real and personal property owned by her deceased husband 52 276. Mr. Reynolds inspects a piece of property. He notes a pile of fencing that the seller tells him he had purchased with the intent of fencing in the yard but has not gotten around to doing it yet. When Mr. Reynolds buys the house and takes occupancy, he finds that the fencing has not been installed and has been removed. Mr. Reynolds consults his lawyer who advises him that: a. Since he saw the fencing at the time of inspection, it is part of the sale and should have remained. b. Since it was not yet installed, it is personal property and the seller had the right to remove it. c. He ought to try to negotiate with the seller for its return prior to taking legal action. d. According to real estate license law, this is a fixture of the property and the seller's right to the fencing would probably be upheld in a court of law. - Answer- B. Since it was not yet installed, it is personal property and the seller had the right to remove it 277. Which tenancy exists when a tenant remains in possession of a property after the termination of the lease without the landlord's agreement? a. Tenancy at will b. Tenancy at sufferance c. Tenancy for years d. Tenancy in common - Answer- B. Tenancy at sufferance 278. Which of the following shares of real property will a widow with no children receive at her husband's death in the absence of a will? a. One-third b. All c. One-half d. Life estate - Answer- B. All 279. What does personal property that is permanently attached to the land become? a. An encumbrance b. An attachment c. A fixture d. An encroachment - Answer- C. A fixture 280. Which type of estate is the most comprehensive? a. Life estate 55 c. Quitclaim deed d. Special warranty deed - Answer- D. Special warranty deed 293. The neighbors have used Farmer Jones' "ruts" (easement by necessity) for over 20 consecutive years. It may now be considered an: a. Easement appurtenant b. Easement in gross c. Easement by prescription d. Implied easement - Answer- C. Easement by prescription 294. Complete the statement. A deed must be acknowledged (notarized): a. Prior to being witnessed b. By an attorney c. To make it valid d. To make it recordable - Answer- D. To make it recordable 295. If an unrecorded deed is accidentally destroyed, who owns the property? a. Title holder of record b. Grantee c. Vendor d. Grantor - Answer- B. Grantee 296. Under the laws of eminent domain, for what does an individual have the right for reimbursement? a. Personal anguish b. Assessed value c. Fair market value d. Intrinsic value - Answer- C. Fair market value 297. Complete the statement to make it correct. An easement is the legal right of use: a. Of another's property for any purpose b. Of another's property for a specific purpose c. For up to 7 years d. For up to 20 years - Answer- B. Of another's property for a specific purpose 298. Which of the following clauses in a deed names the parties, describes the property, shows legal consideration, and provides words of conveyance? a. Habendum clause b. Reddendum clause 56 c. Granting clause d. Restriction clause - Answer- C. Granting clause 299. Where do special assessment liens on property rank in priority of payment? a. After private liens b. Ahead of private liens c. Ahead of real property tax liens d. Ahead of all liens - Answer- B. Ahead of private liens 300. Which of the following is essential for a deed to be valid? a. Competent grantee, both legally and mentally b. Acknowledged and recorded c. Signed by the grantor and/or grantors d. Stipulates the exact amount of consideration involved - Answer- C. Signed by the grantor and/or grantors 301. Which covenant in a deed assures the grantee that there are no claims or liens on the property other than those specifically listed on the deed? a. Warrant of quiet enjoyment b. Encumbrance clause c. Seizin clause d. Warrant of further assurance - Answer- B. Encumbrance clause 302. Which set of terms is NOT synonymous? a. Vendee, purchaser b. Mortgagee, lender c. Lessor, landlord d. Grantee, seller - Answer- D. Grantee, seller 303. Mr. Able sold his home to Mr. and Mrs. Baker and gave them a warranty deed. The Bakers moved into the home but did not record the deed. Two days later, Mr. Able died, and his heirs up north sold the property without any knowledge of the previous sale. The heirs conveyed title to Mr. and Mrs. Charles, who did record the deed. Who owns the property? a. Mr. and Mrs. Baker b. Mr. and Mrs. Charles c. Mr. Able's heirs d. The Charles and the Bakers as joint tenants - Answer- A. Mr. and Mrs. Baker 304. In the case of eminent domain, what should the owner expect to receive? 57 a. Payment of fair compensation b. No compensation c. Payment of 50% of market value d. Payment of whatever he or she feels is appropriate - Answer- A. Payment of fair compensation 305. Broker Bob has an exclusive listing. The owner calls and asks if Bob has any offers. Bob says no. Broker Charles submits an offer to the owner that is accepted. Which statement is correct? a. Bob can sue for unliquidated damages but not commission. b. Bob and Charles must share the commission. c. Bob receives no commission and can do nothing about it. d. Bob is entitled to full commission. - Answer- A. Bob can sue for unliquidated damages but not commission 306. Broker Brown gets a listing from Mr. Jones. Broker Brown agrees to advertise, caravan and print material intended to help in the sale of the house. Mr. Jones agrees to pay a commission to Broker Brown no matter who sells the house. Which type of listing is in place? a. An exclusive listing b. An implied listing c. A general agency agreement d. An exclusive right of sale listing - Answer- D. An exclusive right of sale listing 307. What is the most likely consequence for a broker who negotiates a contract for the sale of a house between the owner and purchaser in violation of the Statute of Frauds? a. Have his or her registration suspended b. Have his or her registration revoked c. Lose his or her commission on the sale d. Not be disciplined - Answer- D. Not be disciplined 308. Which of the following is a characteristic of a parol contract? a. In writing b. Signed by two witnesses c. Covered by statue of frauds d. Oral - Answer- D. Oral 309. Which item creates a formal contract? 60 335. In the process of mortgage underwriting (qualifying), which is of most concern to the lender? a. Assets b. Credit history c. Deductions d. Income - Answer- D. Income 336. What title does a buyer have when he or she signs a sales contract (or has purchased under contract for a deed)? a. Ostensible title b. Real title c. Actual title d. Equitable title - Answer- D. Equitable title 338. All of the following are required for a valid mortgage, EXCEPT: a. The legal description of the property b. Signature of the mortgagee c. Signature of the mortgagor d. It be in writing - Answer- B. Signature of the mortgagee 339. What part of an amortized mortgage payment reduces the principal balance? a. Debt service b. Amortization c. Interest d. Principal and interest - Answer- B. Amortization 340. Under what circumstance is personal property included in the purchase of a home as additional security for the loan? a. As an optional extra feature b. As an additional down payment c. As part of a package mortgage d. Never - Answer- C. As part of a package mortgage 341. A buyer purchases a property with an existing mortgage and assumes personal responsibility for the note. Which term describes this situation? a. An assignment of mortgage b. Novation c. Purchasing subject to a mortgage d. An assumption of mortgage - Answer- D. An assumption of mortgage 61 342. Complete the sentence. The maximum loan permissible for a VA loan is: a. $104,250 b. Determined by location c. Determined by the VA d. Determined by individual lenders - Answer- D. Determined by individual lenders 343. A buyer takes over the seller's mortgage payments, but does not assume liability. Which statement best describes this situation? a. The buyer is purchasing subject to the mortgage. b. The buyer is assuming the loan with novation. c. This is legal only when the mortgage contains a due-on-sale clause d. This is an example of an assumption - Answer- A. The buyer is purchasing subject to the mortgage 344. Which clause in a mortgage requires the lender to look to the mortgaged property only for satisfaction? a. Defeasance clause b. Exculpatory clause c. Cognovit clause d. Subordination clause - Answer- B. Exculpatory clause 345. Which loan does NOT require a down payment? a. VA guaranteed b. Conventional c. FHA insured d. Adjustable rate mortgage - Answer- A. VA guaranteed 346. The buyer receives all of the following items at closing, EXCEPT: a. Deed b. Mortgage c. Opinion of title d. Closing statement - Answer- B. Mortgage 347. Who are the three parties in a trust deed? a. Benefactor, trustee, and trustor b. Beneficiary, mortgagor, and trustee c. Beneficiary, trustor, and trustee d. Beneficiary, mortgagee, and trustor - Answer- C. Beneficiary, trustor, and trustee 62 348. Which entity regulates a life insurance company in the primary mortgage market? a. RESPA b. The federal government c. The state in which it operates d. None, they are not regulated - Answer- C. The state in which it operates 349. All of the following loans can be first liens, EXCEPT: a. First mortgage b. Home equity loan c. Second mortgage d. Purchase money mortgage - Answer- C. Second mortgage 350. What is the effect of positive leverage? a. Increases the lender's yield b. Increases the lender's loan to value yield c. Increases the borrower's yield d. Allows an individual to lift a heavy weight - Answer- C. Increases the borrower's yield 351. Which clause in a mortgage calls for the principal balance to be paid in full? a. Satisfaction clause b. Defeasance clause c. Due on sale clause d. Cognovit clause - Answer- C. Due on sale clause 352. What is included in the annual percentage rate (APR)? a. Annual interest b. Finance charge c. Simple annual interest d. Simple annual interest plus finance charges - Answer- D. Simple annual interest plus finance charges 353. What type of loan covers several parcels of land? a. Package mortgage b. Blanket mortgage c. Balloon mortgage d. Purchase money mortgage - Answer- B. Blanket mortgage. 354. Which mortgage provides an interest only loan? 65 366. Which condition would decrease the supply of loanable funds for real estate loans? a. The government bonds this year are 9% compared to 8% last year. b. There is a 3% increase in family income nationwide. c. People take money from their savings accounts to put into retirement accounts. d. There is an overall increase in consumer spending. - Answer- A. The government bonds this year are 9% compared to 8% last year 367. All of the following entities are secondary mortgage market participants, EXCEPT: a. Fannie Mae b. Freddie Mac c. Federal Reserve d. Ginnie Mae - Answer- C. Federal Reserve 368. Who could be the seller? a. Mortgagor b. Vendee c. Grantor d. Grantee - Answer- C. Grantor 369. All of the following entities may assign a mortgage, EXCEPT: a. Freddie Mac b. A mortgagee c. Fannie Mae d. A mortgagor - Answer- D. A mortgagor 370. All of the following are primary lenders, EXCEPT: a. Mortgage loan originators b. Commercial banks c. Life insurance companies d. Savings associations - Answer- A. Mortgage loan originators 371. Which type of lending institution is formed by private investment groups to purchase real estate for investment and to make short-term construction and long-term mortgage loans? 66 a. Credit union b. Savings association c. REIT d. Commercial bank - Answer- C. REIT 372. All of the following statements apply to an estoppel certificate, EXCEPT: a. It may also be called a letter of estoppel. b. It is used to confirm that a lien or obligation exists. c. It is used to confirm the outstanding loan balance as of a given date. d. It forms a lien against the property. - Answer- D. It forms a lien against the property 373. Which combination of appraisal approach and property type would be agreeable to an experienced appraiser? a. Income approach: special-purpose properties b. Income approach: owner-occupied home c. Comparable sales approach: vacant land d. Cost-depreciation approach: residential land - Answer- C. Comparable sales approach: vacant land 374. Which appraisal method values the land separately from the improvements? a. Gross multiplier b. Income c. Comparable sales d. Cost-depreciation - Answer- D. Cost-depreciation 375. Which of the following could be an example of external obsolescence? a. The architectural design of a building b. A zoning change in the area c. Peeling paint on the exterior of the building d. An outdated oil-burning range in the kitchen - Answer- B. A zoning change in the area 376. What is the term used to refer to the process of arriving at a final estimate of value in appraising? a. Highest and best use b. Averaging 67 c. Reconciliation d. Computation - Answer- C. Reconciliation 377. What are the main steps in direct capitalization when using the income approach to valuation of real estate? a. Estimate the gross income, add in the operating expenses and capitalize the net operation income b. Estimate the capitalization rate, adjust the gross income for vacancies and divide c. Estimate gross income, deduct the vacancies and operating expenses and capitalize the net operating income into value by dividing by an overall rate d. Identify the gross income, plan the appraisal and collect the expenses - Answer- C. Estimate gross income, deduct the vacancies and operating expenses and capitalize the net operating income into value by dividing by an overall rate 378. Which principle of value indicates that the value of a property is sustained when the property is harmoniously used with surrounding properties in the same area? a. Contribution b. Conformity c. Balance d. Highest and best use - Answer- B. Conformity 379. With the income approach to appraising, the value of the property today is: a. More than the future value b. Measured in future benefits c. Not considered in an appraisal d. To be paid to the appraiser - Answer- B. Measured in future benefits 380. A house valued comparably to all houses in the neighborhood was assessed at a tax base $5,000.00 less than the others. Excluding any special tax exemptions, what should the property should sell for? a. Less than the others b. More than the others c. Same as the others d. The property will not sell at all - Answer- A. Less than the others 381. The steps in the cost-depreciation approach to estimating market value include all of the following, EXCEPT: 70 c. Commercial depreciation d. Functional obsolescence - Answer- C. Commercial depreciation 393. Which condition would NOT indicate functional obsolescence? a. Too few electrical outlets b. A house with one bathroom c. A poor floor plan d. Damaged carpet - Answer- D. Damaged carpet 394. What would be an investor's motivation for deducting depreciation? a. Maximizing cash flow b. Minimizing cash flow c. Maximizing liability d. Minimizing income - Answer- A. Maximizing cash flow 395. Under Truth in Lending, "triggering terms" include information regarding all of the following, EXCEPT: a. Amount of down payment required in a credit sale transaction b. Amount of finance charge c. Number of loan payments d. Easy monthly payments - Answer- D. Easy monthly payments 396. Which definition best describes the equity a homeowner has in their home? a. The difference between the market value and the mortgage balance b. The amount of upfront cash paid upon purchase of the home c. The amount still owed on the home d. The value determined by an appraiser - Answer- A. The difference between the market value and the mortgage balance 397. Depreciation can be taken on all of the following, EXCEPT: a. An office building b. A warehouse building c. A garage d. Land - Answer- D. Land 398. To which type of transaction does Regulation Z apply? a. Single-family home used for rental 71 income b. Building used for a gas station c. Vacant land used for a parking lot d. Single-family home used as residence - Answer- D. Single-family home used as residence 399. Residential investment property is depreciated over a useful life of how many years? a. 27.5 years b. 31.5 years c. 39 years d. 17.5 years - Answer- A. 27.5 years 400. When determining the net operating income (NOI) for direct capitalization, all of the following items are subtracted from the potential gross income (PGI), EXCEPT: a. Vacancies and collection losses b. Reserves for replacements c. Mortgage payments d. Property taxes - Answer- C. Mortgage payments 401. Which government survey legal description is the closest to the Tallahassee Principal Meridian? a. Tier2S, Range3E b. Tier1N, Range4W c. Tier2N, Range2E d. Tier4S, Range1E - Answer- D. Tier 4 S, Range 1 E 402. A line from a POB running N90°E would be best described as a(an): a. North/south line b. North line c. Westbound line d. East/west line - Answer- D. East/west line 403. What section is immediately due west of Section 18? a. Section 17 b. Section 13 c. Section 19 d. Section 20 - Answer- B. Section 13 404. The southwest corner of Section 31, T1N, R4E is how many miles from Tallahassee? 72 a. 6 b. 12 c. 18 d. 24 - Answer- C. 18 405. Which is best description of a township? a. 1 square mile b. 6 miles square c. 36 miles square d. 6 square miles - Answer- B.. 6 miles square 406. What is the opposite of N10°E? a. N90°W b. S40°E c. N10°W d. S10°W - Answer- D. S10°W 407. Which of the following is equivalent to an acre? a. 1/640 of a section b. 43,560 square feet c. 208.71-foot square parcel d. All of the above - Answer- D. All of the above 408. How many townships are in a check? a. 36 b. 24 c. 16 d.4 - Answer- C. 16 409. How many acres are in the following: The NW 1/4 of the NW 1/4 of the SW 1/4 of the SW 1/4 and the SW 1/4 of the SW 1/4 of the NW 1/4 of the SW 1/4 of Section 27. a. 5 acres b. 2.5 acres c. 1.25 acres d. Approximately .001 acre - Answer- A. 5 acres 410. Where is section 33 located within a township? a. North b. South 75 432. Bob purchased two-fifths interest in joint property for $28,000. What was the total sale price of this property? a. $11,200 b. $35,000 c. $46,666 d. $70,000 - Answer- D. $70,000 433. A sales associate collected a $4,800 commission on the sale of the NE 1/4 of the NW 1/4 of the SW 1/4 of a section. The broker's share of the 10% commission was 60%. How much did the property sell for per acre? a. $8,000 b. $10,000 c. $12,000 d. $120,000 - Answer- C. $12,000 434. MacBurger USA wants to purchase a piece of land for the purpose of constructing a 15,000-square-foot restaurant to accommodate 85 people. The zoning ordinances require one parking space for every 2 people and that each space be 6 feet by 12 feet. In addition, they must allow 10% of the paved area for lanes and dividing lines. There are two lots available. Lot A is 100 feet by 200 feet; lot B is 90 feet by 210 feet. Which of the two lots might MacBurger choose? a. Lot A b. Lot B c. Either lot A or B d. Neither lot A nor B - Answer- C. Either lot A or B 435. A developer sells two lots that are each 60 feet by 100 feet for $20 per square foot each. On the first lot, she makes a 20% profit. On the second lot, she suffers a 20% loss. Calculate her net profit or loss a. $5,000 b. $10,000 c. $15,000 d. $0, she broke even. - Answer- B. $10,000 436. A licensee receives a monthly salary of $500, a 2% commission on all listings that sell, and 3% on all sales. Last month, none of her listings sold, but she did receive a total of $7,400 in salary and commissions. What is the value of the properties that she sold? a. $250,000 b. $246,667 c. $230,000 76 d. $148,000 - Answer- C. $230,000 437. A mortgage is $55,000 with 12% interest for 30 years, and monthly payments of $565.74. If the loan is held to maturity, how much interest would the borrower have paid? a. $148,666.40 b. $198,000.00 c. $203,666.40 d. $403,333.33 - Answer- A. $148,666.40 438. Mr. Smith buys a house for $38,000. He pays 10% down and will take out a mortgage on the balance at 14% interest for 30 years. The monthly loan constant is .011849. What is the total amount of interest paid in the third month? a. $432.77 b. $399.00 c. $398.93 d. $398.85 - Answer- D. $398.85 439. A tenant pays rent at a cost of $5.00 per square foot. When he rents the property, the CPI (rent index) is at 1.5. The CPI goes up to 1.8. How much will his rent be increased to if it is based on the CPI? a. $5.50 per square foot b. $6.00 per square foot c. $7.50 per square foot d. $8.00 per square foot - Answer- B. $6.00 per square foot 440. A buyer is purchasing a home for $48,000 with an FHA loan. He borrows the maximum loan amount with the minimum down payment. How much of a down payment will the buyer need? a. $0 b. $800 c. $1,700 d. $4,632 - Answer- C. $1,700 441. A person owns an acre of property. After allowing for a road 60 feet wide and 246 feet long, how many 80-foot by 90-foot lots could be developed? a. Three lots b. Four lots c. Five lots d. Six lots - Answer- B. Four lots 77 442. A corner lot measures 100 feet by 100 feet. The only restriction is a 10-foot setback from the road. What is the maximum usable square footage? a. 8,000 square feet b. 8,100 square feet c. 9,000 square feet d. 10,000 square feet - Answer- B. 8,100 square feet 443. If 10,000 new households are expected in an area over the next 5 years, and each household will use about 1/4 acre of land, how many additional acres will the community have to service? a. 2,500 b. 5,000 c. 7,500 d. 12,500 - Answer- A. 2,500 444. A broker was asked by a seller to appraise the seller's home in a residential neighborhood. The seller's home was a three-bedroom, two-bath house. Homes have been appreciating in this area at 10% per year. The broker estimates bedrooms in this area to be worth $12,000, and bathrooms are worth $5,000. Using the following three comparables, estimate the approximate market value of the subject home assuming that the comparables are weighted equally. x No. 1: 3/3 sold 1 year ago for $81,000 x No. 2: 4/2 sold 6 months ago for $91,000 x No. 3: 2/2 sold recently for $72,500 a. $82,000 b. $83,000 c. $84,000 d. $85,000 - Answer- C. $84,000 445. A building cost $55 per square foot to build today, but cost $45 per square foot to build when it was new 10 years ago. It was kept in good condition and appears to be only 7 years old. It contains 3,000 square feet. The lot measures 100 feet by 120 feet and comparable sites are selling for $3.10 per square foot. Site improvements are valued at $4,000. Using a 35-year useful life, estimate the value of the property. a. $173,200 b. $159,057 c. $149,200 d. $137,629 - Answer- A. $173,200. 446. A 5-year-old building has a reproduction cost of $100,000. The building requires a new roof, which will cost $4,000. Estimate the accrued depreciation based on a 25-year useful life. a. $29,000 80 d. $357,000 - Answer- B. $510,000 457. 12,000 square feet of warehouse space is leased at $.075 per square foot per month. The gross income multiplier is 7.5. What is the market value of the property? a. $6,750 b. $10,800 c. $81,000 d. $108,000 - Answer- C. $81,000 458. If the documentary stamp tax on the deed was $520.10, and the note tax on the purchase money mortgage was $227.50, how much was the sales price and the purchase money mortgage? a. $150,000 and $55,000 b. $148,600 and $32,500 c. $74,300 and $65,000 d. $32,500 and $15,000 - Answer- C. $74,300 and $65,000 459. A house is purchased for $175,000. The buyer will assume the existing first mortgage with a balance of $110,512, and the seller will take back a purchase money second mortgage for $21,500. Calculate the total state documentary stamp taxes that will be charged in this transaction. a. $1,730.04 b. $1,730.35 c. $1,951.06 d. $1,951.37 - Answer- B. $1,730.35 460. Mr. Smith qualifies for homestead exemption. He is a widower and has an additional exemption because he is blind. The county millage rate is 7¾ mills, the city millage rate is 6½ mills, and the school millage rate is 9¼ mills. If his property is assessed at $125,000, how much is his tax bill reduced by exemptions? a. $1,000.00 b. $365.25 c. $611.00 d. $967.25 - Answer- D. $967.25 461. The city tax rate is 8 3/4 mills, the county rate is 9½ mills and the school board rate is 7¾ mills. If the property is assessed at $50,000 and enjoys a homestead exemption, how much would the taxes be for the year? a. $1,300 b. $1,170 c. $780 81 d. $650 - Answer- D. $650 462. What would the value of a homestead exemption be for a property assessed at $285,000, if the city tax rate is 9 mills, the county rate is 8 mills and the school board rate is 10 mills? a. $1,100 b. $560 c. $480 d. This question cannot be answered as the school board rate exceeds the cap. - Answer- A. $1,100 463. It costs the city $20 per foot to pave the road in front of a 100-foot lot. The city has agreed to pay for 30% of the cost. What would be the amount of the special assessment tax? a. $700 b. $1,000 c. $1,400 d. $2,000 - Answer- A. $700 464. A buyer purchases Mr. Orange's home for $190,000, assuming the first mortgage, which covers 80% of the purchase price. Mr. Dis Count, a licensed mortgage loan originator, arranges a second mortgage for 46% of the difference. Mr. Dis Count wants 2½ points as an origination fee. What will the total down payment be, including the origination fee? a. $20,957 b. $17,480 c. $14,145 d. $437 - Answer- A. $20,957 465. The quoted interest rate on a conventional loan is 12.5%, but after allowing for the origination fee, the true APR is 13%. Approximately how many points did the bank charge for the loan? a. 4 b. 5 c. 6 d. 8 - Answer- A. 4 466. How is an existing mortgage that is being retired at closing shown on a closing statement? a. Debit to seller b. Debit to buyer 82 c. Credit to seller d. Prorated between the buyer and seller - Answer- A. Debit to seller 467. The binder deposit shows on the seller's closing statement only under which condition? a. It is paid in cash. b. The deposit exceeds the commission. c. It is paid directly to the seller by the buyer. d. The closing will be handled by a title company. - Answer- C. It is paid directly to the seller by the buyer 468. How are property taxes accounted for on a closing statement? a. Debited entirely to the buyer b. Prepaid entirely by the buyer c. Prorated between the buyer and seller d. Debited entirely to the seller - Answer- C. Prorated between the buyer and seller 469. What would you expect to see on a broker's reconciliation section of the closing statement? a. Disbursements equal the receipts, minus the brokerage fee b. Broker's fee is prepaid by the buyer c. Disbursements equal receipts plus brokerage d. Disbursements equal receipts - Answer- D. Disbursements equal receipts 470. Which of the following is an entry on a broker's cash reconciliation statement? a. Expenses of the buyer are shown as a disbursement b. Expenses of the seller shown as a receipt c. Expenses of the buyer shown as a receipt d. Expenses of the broker shown as a disbursement - Answer- A. Expenses of the buyer are shown as a disbursement 471. Which of the following items would typically appear as debits to the seller on the closing statement? a. First mortgage interest, purchase price, and expenses b. Assumed mortgage interest, taxes, and 85 a. Paul must pay $1,000 to the bank at closing. b. Sally must make up the difference. c. Sally has committed fraud. d. Paul and Sally have formed a conspiracy. - Answer- C. Sally has committed fraud 480. A broker has been found guilty by the Florida Real Estate Commission of advertising in a fraudulent, false, deceptive, or misleading way. In addition to administrative penalties, what criminal violation has occurred? a. First-degree misdemeanor b. Second-degree misdemeanor c. Second-degree felony d. Third-degree felony - Answer- B. Second-degree misdemeanor 481. An investigator for the Department has audited a broker's escrow account and found a balance of $12,000. The trust liability totaled $30,000. If the broker's commissions on the pending transactions total $18,000, which statement is correct? a. The investigator will approve the audit. b. The broker may be disciplined by the Florida Real Estate Commission. c. No violation of the law is evident based on this audit. d. The broker will be required to deposit $18,000 into the escrow account within 3 working days of the audit. - Answer- B. The broker may be disciplined by the Florida Real Estate Commission 482. A broker held up a bank and escaped with a large amount of cash. What is the consequence if the broker is apprehended? a. Broker's license must be revoked. b. Broker is subject to discipline by the Florida Real Estate Commission. c. Broker must be suspended. d. Florida Real Estate Commission may impose a fine of $1,000 and imprison the broker for no more than 1 year. - Answer- B. Broker is subject to discipline by the Florida Real Estate Commission 483. Which statement is true with respect to limited partners in a limited partnership formed to broker real estate? a. All limited partners must be brokers, either active or inactive. b. Limited partners are not allowed to 86 perform management services. c. Actively licensed limited partners may perform management services for the partnership. d. All limited partners must be licensed as inactive brokers or inactive sales associates. - Answer- B. Limited partners are not allowed to perform management services 485. A broker lists an owner's property for 6 months on an exclusive listing agreement for $80,000 at a commission of 7%. Three months later the owner sells the property to a nephew for $74,400. Which statement is correct? a. The owner owes the broker a commission based on the listed price of $80,000. b. The owner does not owe the broker a commission. c. The owner is liable to the broker for damages. d. The owner owes a commission based on the sale price of $74,400. - Answer- B. The owner does not owe the broker a commission 486. Peggy and Joan wish to form a partnership to buy and sell real estate for others. Which statement is correct? a. Peggy and Joan must both be actively licensed brokers. b. Either Peggy or Joan must be an actively licensed broker. c. If Peggy is an actively licensed broker, Joan must be an inactively licensed broker or be registered as an unlicensed partner. d. If Joan is an actively licensed broker, Peggy must be an actively licensed sales associate or broker associate. - Answer- B. Either Peggy or Joan must be an actively licensed broker 487. Broker Stan showed Benny a 30-year-old home owned by Chuck. Benny was concerned about the age of the house, but Stan convinced Benny to buy it for the listed price of $89,000 by promising to buy the home from Benny for the full price within 3 months if Benny found the home to be unsatisfactory. Which statement is correct? a. Stan's promise violates the license law, and he is subject to disciplinary action. b. If Benny asks Stan to purchase the home from him, and Stan refuses, Stan would be in violation of the license law. c. Stan would not be required under the license law to purchase the home from Benny. d. Chuck would be required to repurchase the property as the broker was acting as his agent in the transaction. - Answer- B. If Benny asks Stan to purchase the home from him, and Stan refuses, Stan would be in violation of the license law 484. A Florida broker was arrested in Alabama and charged with possession of stolen property. The broker has confessed to a role in a theft ring and has provided the names 87 of his accomplices. Should the FREC be made aware of this prior to the case going to trial, what action would it take regarding the broker's license? a. The Commission cannot take action against the broker until the broker is proven guilty in a court of law. b. The broker will be suspended pending the outcome of the trial. c. The Commission may revoke the broker's license. d. Since the activity does not involve real estate, and occurred outside the state of Florida, the Commission has no jurisdiction over the broker's actions. - Answer- C. The Commission may revoke the broker's license 488. Ernie is a licensed broker in Chicago who had a customer for a condominium in Tampa. Ernie accompanied the customer to Tampa and introduced him to broker Dora, a licensed Florida broker. Ernie went to the beach while Dora showed the customer condominiums and was successful in obtaining a contract. Ernie returned to Dora's office a short time later and demanded a share of the commission. Which is correct? a. Ernie violated the license law by accompanying the prospect to Florida. b. Both Ernie and Dora are in violation of F.S. 475. c. If Dora pays Ernie a commission, she would be in violation of the license law. d. Dora may pay Ernie a commission. - Answer- D. Dora may pay Ernie a commission 489. Which statement is correct regarding a broker acting as a transaction broker? a. The broker has fiduciary duties to both parties. b. The broker has fiduciary duties to the seller, but not to the buyer. c. Both parties must give their prior written consent before the broker may act as a transaction broker. d. The broker must treat both parties with honesty and fairness. - Answer- D. The broker must treat both parties with honesty and fairness 490. Broker Dan and broker Fred both have an open listing on Gail's home. Broker Dan showed Gail's home to customer Paula. Six months later broker Fred shows Gail's home to Paula and Paula buys it. Which is correct? a. Gail owes Fred a commission. b. Gail owes Dan a commission. c. Fred and Dan must share the commission. d. Gail must pay both brokers a 90 a. Be a married couple, filing jointly b. Neither spouse has previously used the exclusion c. The replacement residence must be of equal or greater value than the one being sold d. The home must have served as a principal residence at least 3 of the last 5 years - Answer- A. Be a married couple, filing jointly 499. A broker gave a number of business cards to a hotel registration clerk and asked the clerk to refer customers to him. For each customer the clerk refers, the broker promises to pay a fee of $20. What will happen if this fee is paid? a. The broker will be in violation of the law. b. The hotel clerk will not be in violation of the law. c. Neither the broker nor the clerk will be in violation of the law. d. Both the broker and the clerk will be in violation of the law. - Answer- D. Both the broker and the clerk will be in violation of the law 500. All of the following statements are correct regarding the Consumer Credit Protection Act, EXCEPT: a. The Act was designed to give borrowers the ability to shop wisely for credit. b. Borrowers must be shown the actual amount paid for credit in a percentage form called the annual percentage rate (APR). c. Borrowers must be given 3 working days to rescind a loan. d. The Act was implemented by the Board of Governors of the Federal Reserve System through Regulation B. - Answer- D. The Act was implemented by the Board of Governors of the Federal Reserve System through Regulation B 501. A broker has a listing on a seller's house. The seller goes on vacation. During this time, the broker gets an offer for $78,000 and another offer for $80,000. What should the broker do? a. Present the $80,000 offer upon seller's return b. Accept the $80,000 offer on behalf of the seller c. Reject the $78,000 offer d. Present both offers upon the seller's return - Answer- D. Present both offers upon the seller's return 91 502. In case of a financial hardship due to a zoning requirement, for what should the homeowner apply? a. Nonconforming use b. Special use exception c. Easement d. Variance - Answer- D. Variance 503. In Florida, what does the 10-mill cap apply to? a. Income taxes b. Intangible taxes c. City, county and school tax districts d. Sales taxes - Answer- C. City, county and school tax districts 504. The DBPR may investigate matters it considers a violation of the license law in which of the following situations? a. It may investigate only those individuals who are registered with the FREC as sales associates or brokers. b. It may investigate only upon court- ordered subpoenas. c. It may investigate any person having knowledge of the facts of the case. d. It may investigate only if jurisdiction has been established by a proper court of law. - Answer- C. It may investigate any person having knowledge of the facts of the case 505. If a licensee fails to renew his or her license at the end of the prescribed period, what is the status of the license? a. It may remain inactive for a maximum of 2 years. b. It may remain inactive for a maximum of 10 years. c. It is automatically suspended. d. It must be renewed as soon as possible. - Answer- A. It may remain inactive for a maximum of 2 years 506. What is the expected result when the banks stock up their reserves? a. A tight money market b. An easy money market c. Prepayment of loans d. Easier financing - Answer- A. A tight money market 92 507. Frank and Harry own a property. Frank dies, and the property passes to Harry. How was the property held? a. Tenancy by the entireties b. Joint estate c. Tenancy at will d. Community property - Answer- B. Joint estate 508. What was the major impact of the Jones v. Mayer Supreme Court case in 1968? a. It protected borrowers from fraudulent lending practices. b. It added handicap and familial status to the list of protected classes. c. It created the USPAP standards for appraisal. d. It strictly prohibited discrimination based on race, with no exceptions. - Answer- D. It strictly prohibited discrimination based on race, with no exceptions 509. The defendant must file an answer to an administrative complaint within how many days? a. 15 b. 21 c. 30 d. 14 - Answer- B. 21 510. A sales associate must do all the following to renew a current and valid license, EXCEPT: a. Complete 14 hours of continuing education, for renewal periods after the first renewal b. Complete the proper renewal request form and pay the required fee c. Pass a 45-hour post-licensing course, if renewing for the first time d. Show Florida residency. - Answer- D. Show Florida residency 511. A broker was convicted of securities fraud also causing FREC to revoke his license. If he is the only broker in a sole proprietorship, what would the license status become of the sales associates registered under him? a. Revoked 95 a. Jones must become a licensed real estate sales associate. b. Jones must become a licensed real estate broker. c. Jones must hire the services of a licensed real estate broker. d. Jones may sell Smith's property without a real estate license. - Answer- D. Jones may sell Smith's property without a real estate license 521. A broker sells Jayne, a prospective renter, a rental list for $100 on May 1. If Jayne wants a refund, by what date must Jayne request the refund? a. May 31 b. June 1 c. May 15 d. June 15 - Answer- A. May 31 522. Janet has reached the end of her lease. She is unable to reach the landlord but stayed in the property anyway. What type of tenancy does Janet have? a. Tenancy at sufferance b. Tenancy at will c. Tenancy by the entireties d. Tenancy in gross - Answer- A. Tenancy at sufferance 523. Sally is a licensed real estate broker in a state that has a mutual recognition agreement with Florida. Sally wishes to obtain a Florida license. Her choices include all of the following, EXCEPT: a. Taking a 40-question law exam and be issued a Florida broker license by mutual recognition if she is not a Florida resident b. Taking the broker course and state exam if she is a Florida resident c. Taking the sales associate course and state exam if she wishes to become a Florida sales associate d. Receiving a Florida license by reciprocity if she is not a Florida resident - Answer- D. Receiving a Florida license by reciprocity if she is not a Florida resident 524. What action will occur when the FREC imposes a fine against a licensee, and the individual is unable to pay the fine? a. The DBPR/FREC can force bankruptcy b. The DBPR/FREC will suspend or revoke the license c. They will allow the licensee to pay it when they have the money d. A civil action will be brought to recover and a judgment awarded - Answer- D. A civil action will be brought to recover and a judgment awarded 96 525. Sales associate Colleen, who works for broker Coco, was assigned the task of writing real estate advertisements in Coco's office. Is this a violation of F.S. 475? a. Yes, because only brokers can write real estate ads b. Yes, because only the listing sales associate under the direct supervision of the broker can write real estate ads c. No, because any sales associate may write an ad regardless of whether they took the listing or not, provided it is under the direct supervision of the broker and the broker's name appears in the ad d. No, because any sales associate may write an ad with the permission of the employing broker, provided it is under the direct supervision of the broker and the broker's name appears in the ad, and provided also that if a sales associate's name is used in the ad, it is the listing sales associate's name - Answer- C. No, because any sales associate may write an ad regardless of whether they took the listing or not, provided it is under the direct supervision of the broker and the broker's name appears in the ad 526. Under which condition may a sales associate be employed by two brokers? a. If FREC grants a special exception b. If both employers agree c. If the public agrees d. Under no circumstances - Answer- D. Under no circumstances 527. Which type of property can be purchased with a VA loan? a. An apartment building b. An income-producing investment property c. Commercial property d. Any owner-occupied residence, including condominiums and mobile homes - Answer- D. Any owner-occupied residence, including condominiums and mobile homes 528. What is an individual referred to as who is fully qualified as a real estate broker, but chooses to work for another employer in the capacity of a sales associate? a. Active broker b. Inactive broker c. Active sales associate d. Broker associate - Answer- D. Broker associate 529. What is the FREC authorized to do? a. Issue a writ of mandamus 97 b. Seek an injunction c. Revoke a license automatically d. Issue a summary suspension - Answer- B. Seek an injunction 530. Recommendations regarding changes in educational curriculum come under the powers of which entity? a. FREC b. Florida governor c. Post-license commission committee d. Secretary of State - Answer- A. FREC 531. An earnest money deposit can be placed in all of the following institutions, EXCEPT: a. A stock association b. A commercial bank c. A savings association d. A credit union - Answer- A. A stock association 532. What would be considered an arm's length transaction? a. Mr. Ajax to the Ajax Corporation b. Mr. Smith to Mrs. Smith (husband and wife) c. Mr. Black to Mrs. Jones (not related) d. Gateway Corporation to ABC investment (Gateway owns 15 shares of ABC) - Answer- C. Mr. Black to Mrs. Jones (not related) 533. A qualified applicant from a mutual recognition state who is requesting a license by mutual recognition is required to do which of the following? a. Provide proof of licensure in a mutual recognition state b. Provide a notarized letter stating their intent to become a Florida resident c. Provide proof of Florida residency for a minimum of the last six months d. Pass a 100-question law exam - Answer- A. Provide proof of licensure in a mutual recognition state 534. What type of writ contains a command to stay a legal proceeding, as in halting or delaying the suspension or revocation of a real estate licensee's license? a. Certiorari b. Mandamus c. Possession d. Supersedeas - Answer- D. Supersedeas