Practice Test for a Real Estate Exam in Florida

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1. A court awarded a judgment to a couple against a broker for $30,000 actual damages and for $45,000 punitive damages regarding a real estate brokerage transaction. What is the maximum amount of reimbursement available to the couple from the Real Estate Recovery Fund?
2. Two close friends own a nursery as joint tenants with right of survivorship. One owner died unexpectedly. Who now owns the nursery?
3. A licensed real estate sales associate conducted an appraisal for a fee. The FREC found the licensee to be in violation of the Uniform Standards of Professional Practice.
4. Variables that influence demand do NOT include
5. A tenant rents a college apartment and pays rent on the tenth of every month. The tenant has a written agreement with the property owner; however, there is no specified termination date. Which statement is TRUE?
6. A Florida broker has multiple licenses. She is an active broker for Brokerage Company One as well as Brokerage Company Two. A sales associate for Brokerage Company One has procured a listing as a single agent to sell a condo. A sales associate for Brokerage Company Two is a single agent of a buyer who has entered into a contract to purchase the condo. Which applies?
7. A broker chooses not to maintain an escrow account. Which statement is TRUE regarding this situation?
8. A couple have been married for 40 years. They have owned and sold several homes during their marriage and have rolled over the gain from the sale of previous homes. The husband is planning on retiring at age 60, and so the couple has decided to sell their spacious family home and buy a smaller condo. How does the current tax law affect their capital gains on the sale of their family home?
9. The income capitalization approach to value requires collection of data pertaining to
10. If a real estate sales associate fails to complete the 45-hour post-licensing course prior to the expiration of the initial license, what happens to the license?
11. The broker of record for a real estate company is working with a buyer as a buyer’s single agent. The buyer has become interested in a property listed by the brokerage as a transaction broker. Which statement applies to this situation?
12. Which statement is TRUE regarding townships?
13. A broker has appointed two sales associates to be designated sales associates in a real estate transaction. Chapter 475, F.S., does NOT require
14. A prospective tenant wants to install a ramp to the front door and handrails in the bathroom of a bungalow cottage. Which applies here?
15. A sales associate has a dispute with his former broker over a commission. What recourse does the sales associate have to resolve the commission dispute?
16. A property owner purchased a weather vane. He bolted the weather vane to his roof ridge. The weather vane is
17. The N½ of the NE¼ of the SW¼ and the S½ of the SE¼ of a section contains
18. The city is proposing to pave the streets in your neighborhood at a cost of $47 per foot. The city will absorb 30% of the cost. Your lot has a front footage of 110 feet. Assuming there are homes on both sides of the street, calculate the amount of your paving assessment.
19. A 130-unit apartment complex contains 80 one-bedroom apartments that rent for $750 per month and 50 two-bedroom apartments that rent for $950 per month. The one-bedroom units are 10% vacant, and the two-bedroom units are 5% vacant. Calculate the projected annual effective gross income for this investment property.
20. Annual property taxes are $1,460. Closing is June 1. Using the 365-day method of proration, how is this entered on the composite closing statement? Charge day of closing to the buyer.
21. An applicant responded “No” to the question on her real estate application regarding whether she had ever been found guilty of a crime. Four years ago, the applicant was divorced and lost her job. She found another job a short time later but went ahead and cashed two unemployment checks totaling $700. The applicant went to court for illegally cashing the unemployment checks. She repaid the $700 and adjudication of her guilt was withheld. What action, if any, will the FREC likely take?
22. A sales associate decides to mail personalized notepads to the residents of a neighborhood. The notepads include the associate’s picture plus her name, phone number, and email address. The sales associate paid the cost of printing and mailing the notepads. Which statement applies to this situation?
23. Can a real estate licensee working in a nonrepresentative role with a seller provide the seller a CMA?
24. A broker obtained a judgment from a Florida court against the seller for an unpaid commission. May the broker record the judgment?
25. Which survey method is used when developed subdivisions have been recorded?
26. A property sold two years ago for $120,000. An appraiser estimates that properties in the market area where the parcel is located have appreciated 5% annually. How much is the property worth today, assuming no other factors?
27. The purpose of the Real Estate Settlement Procedures Act is to ensure
28. A broker purchased a list of FHA foreclosure properties from an employee of the FHA. The broker has promised to pay the FHA employee a percentage of all commissions earned by her company resulting from FHA foreclosure sales on the list.
29. A written disclosure form is NOT required regarding which brokerage relationship?
30. Broker Ellen Sammis of Newcomer Realty, Inc., is opening a real estate office. What information is NOT required on her exterior entrance sign?
31. A railroad track easement is which type of easement?
32. A sales associate finds a buyer for another brokerage firm’s listing. The buyer gives the sales associate an earnest money deposit check made payable to the sales associate personally. What should the sales associate do?
33. A sales associate regularly does cold calling for potential listings. The sales associate called a party who informed the associate that he was on the national do-not-call list and did not want to be disturbed. Which statement applies to this situation?
34. If a prospective buyer suspects that there is an encroachment on a property she is considering purchasing, to which document should she refer?
35. At age 19, an applicant was charged with one count of petty theft. She paid a fine during a ten-minute court proceeding and was not sentenced to probation or any other penalty. Nine years later, the applicant is completing her sales associate application. How should the applicant respond to the question on the application concerning whether she has ever been convicted of a crime, found guilty, or entered a plea of guilty or no contest even if adjudication was withheld?
36. If probable cause is found to exist, the probable cause panel will direct the DBPR to file a formal complaint against the subject of the investigation. Which statement is TRUE?
37. A sales associate works for ABC Realty Company in Naples, Florida. While the sales associate is visiting a friend in St. Petersburg, he sees a waterfront lot listed by XYZ Realty. The sales associate sells the lot to his friend, and XYZ Realty pays the sales associate a 10% commission.
38. A real estate licensee indicates on his business cards that he is a REALTOR®. However, the sales associate has not paid dues to the Florida REALTORS® for two years and has allowed his membership to lapse. Can the FREC discipline this licensee for using the REALTOR® logo on his business cards?
39. A sales associate has not completed his continuing education prior to the expiration of his license. In a previous renewal cycle, the sales associate completed his post-licensing requirement. What should the sales associate do?
40. An individual is eligible to seek recovery from the Real Estate Recovery Fund if
41. Which parties constitute an arm’s length transaction?
42. The loan-to-value ratio offered by a local financial institution is 75%. If a buyer wishes to acquire a property selling for $129,500, the buyer will need to make a down payment of
43. The township located due East of T1N, R1E is
44. The Commission’s authority to adopt administrative rules is an exercise of which power?
45. Buyer and seller have entered into a real estate contract. The broker neglected to include a closing date on the contract. Which statement is correct?
46. If a prospective buyer suspects that there is an encroachment on a property she is considering purchasing, to which document should she refer?
47. A buyer makes a written offer on a seller’s property. The seller makes a counteroffer, which the buyer accepts. The listing broker conveys the buyer’s written acceptance to the seller. At this point, the offer becomes
48. A buyer made an offer to purchase and paid a $500 earnest money deposit. The seller accepted the offer. A few weeks later, the transaction fell through. Neither the buyer nor the seller has made a claim on the escrowed deposit. Attempts to contact the buyer and seller have been unsuccessful. What should the broker do with the earnest money deposit?
49. An investor owns a 30-unit apartment complex that produces a net monthly rental income of $9,200. This monthly income represents a 9.5% annual return for the owner during the first year of ownership. What did the investor pay for the building? (Round to the nearest dollar.)
50. A sales associate sells a property for $98,500. The listing broker has agreed to pay the sales associate’s broker 40% of the total sale commission of 8%. The sales associate receives 55% of all commissions the sales associate earns. How much commission did the sales associate receive?
51. Which expense associated with a principal residence is deductible for income tax purposes?
52. What is the maximum allowable homestead exemption for a 65-year-old widower who is legally blind?
53. What is the distance between the south boundary of Section 1 and the north boundary of Section 36 in the same township?
54. The process by which private property is acquired through judicial process to build a police station is called
55. A sales associate has become frustrated with buyers who use his time and expertise and then make an offer to purchase through another real estate company. To help “tie” prospective buyers to the sales associate, he requires prospective buyers to deposit $500 with the real estate company to show intent to deal through the sales associate’s broker. If the buyer makes a purchase, the $500 is applied to the earnest money deposit. However, if the prospective buyer does not make a purchase, the deposit is forfeited. Which statement is TRUE regarding this arrangement?
56. The statement that there must be at least a two-hour fire wall rating between attached common walls would most likely appear in the
57. A broker wants to become associated legally with Carol Homes Realty, Inc. What is the licensee required to do to maintain an active broker license with the company?
58. A licensed real estate sales associate recently purchased a condo and moved out of his former apartment. Is the sales associate required to notify the DBPR?
59. If the Fed wants to stimulate a sluggish economy, it may choose to
60. A previous owner has stipulated that future owners of a tract of land may not operate any type of business on the property that produces a toxic substance of any kind and might potentially harm a natural spring on the property. Where would a real estate licensee interested in listing this property find this information?
61. Three individuals purchase a property without the right of survivorship. Their estate is referred to as a
62. A buyer is considering making an offer to purchase a 50-unit beachfront time-share development from the seller. The buyer and seller have requested that a licensed real estate sales associate act as a single agent representative for each of them. Which statement applies to this situation?
63. A candle company pays the property owner rent in the amount of $500 per month plus 3% of gross sales revenue. The candle company has entered into what type of lease agreement?
64. A husband and wife own homesteaded property. The husband owns investment real estate in severalty. The husband dies testate and bequeaths his investment real property to his sister. Which statement is TRUE?
65. The seller accepted an offer on a home. The contract was contingent on several inspections. Several weeks prior to the closing, the sale fell through due to one of the inspections. Which statement is TRUE regarding the retention of documents?
66. The following are paired relationships EXCEPT
67. Discount points are
68. The monthly payment for principal and interest on a $92,000 loan at 7½% for 30 years is $643.28. What amount of the second month’s payment will be applied to principal?
69. A property owner sometimes falls behind in paying his debts. He owns homesteaded property. The homesteaded property is protected from which debt?
70. A prospective tenant was evicted from a previous apartment for failure to pay rent. The prospective tenant has inspected an apartment and wishes to enter into a lease agreement with the landlord. May the landlord refuse to rent to this tenant?
71. A mortgage must include
72. A landlord has become frustrated that one of her tenants has not paid his rent, so while the tenant is away, the landlord has a locksmith change the locks on the apartment.
73. A broker receives a $100 referral fee from a title company for every transaction that closes through the title company. Because of this, the broker has inserted a sentence into his standard contract for sale and purchase requiring the buyer to use that particular title company. Which statement(s) applies to this situation?
74. The adjusted sale prices of three comparables are $87,900, $88,500, and $82,750. The appraiser applies weights of 30%, 50%, and 20%, respectively. Calculate the indicated value of the subject property.
75. To be in compliance with federal laws regarding lead-based paint, which requirement does NOT apply regarding dwellings built prior to 1978?
76. The market value of a site is determined by its
77. A buyer makes an offer to purchase a home built in the early 1970s that is listed by a real estate company. Prior to signing the contract for purchase and sale, what MUST occur?
78. Two friends discuss the purchase and sale of a tract of land over a beer one Friday night. They jot down the sale price and other terms and conditions on a bar napkin and each signs his name on the napkin. This is
79. A Florida-licensed broker wants to register an office located in New York City as his principal real estate office. May he do so?
80. A commercial tenant pays a pro-rata share of the property taxes, hazard insurance, and utilities. The tenant has what type of lease?
81. A home is located in the historic district of Tampa. The home was built in the early 1900s. The seller gives the buyer a lead-based paint disclosure at the closing. Which statement applies to this situation?
82. Which entity may NOT register as a real estate broker?
83. An acknowledgment is a
84. A customer obtained a judgment against a real estate licensee for negligent conduct involving a real estate brokerage transaction. The licensee had an inactive license at the time that the negligence occurred. If the customer is unable to collect on the judgment, can the customer be reimbursed from the Real Estate Recovery Fund?
85. The subject property is a three-bedroom, two-bath home. A comparable property is a three-bedroom, two and one-half-bath home. An appraiser has determined that the extra half bath is worth about $2,200. What adjustment should the appraiser make?
86. A sales associate decided to move from Tallahassee, Florida, to Macon, Georgia. Which statement(s) is (are) TRUE?
87. Which business structure is designed to protect personal assets?
88. A broker had an exclusive listing to sell a small apartment complex. The owner canceled the listing agreement before an offer was presented and then entered into a lease-management agreement with a third party. Is the broker entitled to a commission?
89. A landlord is a graduate student. The landlord owns a duplex that she rents to college students. The landlord has an inactive real estate license and collects the rent on her own behalf. Which statement is TRUE regarding this situation?
90. A broker was served a citation. The broker wants to dispute the citation. Which statement applies to this situation?
91. Under the Truth-in-Lending Act, certain words trigger disclosures of the amount or percentage of down payment, the terms of repayment, and the annual percentage rate. Which statement is NOT a “triggering term”?
92. A transaction broker does NOT have which duty?
93. If a broker receives conflicting demands on escrowed property, the broker must notify the FREC, in writing, within 15 business days of the last demand and institute one of four settlement procedures unless the transaction
94. A broker who changes the business address must notify the Commission of the address change within how many days?
95. A broker may NOT establish an escrow account in a Florida
96. A broker wants to change one of his branch office locations. What must he do?
97. A Presbyterian church owns a nursing home for its members. The church admits only church members to the nursing facility. Is this legal?
98. A broker sold a home for $150,000. The broker then, at the request of the buyer and seller, prepared a second contract at $180,000 to present to a mortgage company. Which statement is TRUE regarding this situation?
99. Which individual is required to have a real estate license?
100. A sales associate changes her residence from Gainesville, Florida, to Tallahassee, Florida. She remains employed by the same brokerage company. Which statement is TRUE?