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Chapter 3 & 4
License Law & Commission Rules/ Duties & Disclosures
| Question | Answer |
|---|---|
| Department of Business & Professional Regulation (DBPR) | Created by statute, the department regulates professions in the state of Florida, one of which is the Division of Real Estate |
| DBPR powers | issue cease & desist orders (lic & unlic) - administer oaths, take depos, issue subpoenas, & adopt rules-LICENSEES ONLY |
| DBPR citations | 455-citations are issued when rules or laws are violated. the max fine is 5,000 per offense |
| FREC FLORIDA REAL ESTATE COMMISSION | 475-An administrative agency formed to: educate real estate licensees ;pass rules to regulate the operation of licensees & to interpret f.s 475 ; impose disciplinary action against licensees for rule and law violations |
| FREC members | 4-must be licensed real estate brokers for at least 5yrs; 1 must be a licensed real estate sales associate for at least 2yrs; 2 cannot be licensed or have ever been; 1 must be at least 60yrs of ageber |
| FREC member office terms | fs 475; appointed by the governor to at least 4 year terms; may serve no more then 2 consecutive terms; no maximum number of years- but no more than 2 consecutive terms |
| FREC powers | FS 475- executive powers (publish books & education members) quasi-legislative powers (interpret & implement fs 475) quasi-judicial powers (impose disciplinary actions against licensees) |
| FREC disciplinary authority | fs 475- deny applications; issue reprimands; place licensee on probation; suspend licensee on probation; suspend licensee up to 10yrs; permanently revoke license; issue administrative fines up to 5,000 per offense |
| voluntary inactive status | licensee who does not wish to engage in the real estate business; may remain in this status indefinitely; must renew license by completing continuing education every 2 years |
| involuntary inactive | fs 455.02/475.183 licensee does not renew their license; automatically becomes involuntary inactive; stays in the status for 2 years; cannot perform real estate services; license null & void after 2 years |
| us armed forces members | FREC RULE 61J2-1.015 dues & renewal requirements waived while on active duty; continues for 6 months after leaving active duty; applies to spouse while stationed outside Fl; must not engage in real estate activities during this period to maintain status |
| void & ineffective licenses | only active broker in a firm has license; suspended, revoked or becomes ineffective; all licensees under broker are automatically involuntary inactive; turn license back to DBPR- license is cancelled |
| multiple license | fs 475.215 issued to a qualifying broker owning more than one real estate company |
| group license | FREC rule 61J2 6.006 a sales or broker associate working for one owner-developer who is registered, not licensed |
| common law | unwritten law derived from english common law; uses previous court decisions as guidelines |
| statutory law | written laws are called statues; enforced by the courts; fs 455 & 475 are examples |
| administrative law | laws enforced by administrative agencies; have the power to levy monetary fines; fs 455 & 475 are examples |
| special agent | authorized by an employer to perform a single act; the agents employer is her principle |
| general act | authorized to act for an employer on a continuing basis; authority is limited to a specific trade or business; a licensee is a general agent of her broker or owner-employer |
| arm's length relationship | parties are adversaries; licensees may never deal at arms length; owe everyone honesty and fairness |
| universal agent | may act for her principal in all matters (power of attorney) acting for someone lacking the mental capacity |
| Subagent | extension of other agencies; licensee is a general agent for their broker/ owner-employer; licensee is a subagent of broker/ owner-employers principals |
| brokerage relationships | transaction broker (written disclosure not required) single agent (written disclosure required) no brokerage relationship (written disclosure required) applies to residential sales as defined by florida |
| brokerage relationship disclosures | fs 475- transaction broker (written disclosure not required) single agent (written disclosure required) no brokerage relationship (written disclosure required) applies to residential sales as defined by florida |
| brokerage relationship disclosure | must be made before or at the time of entering into a contract, or- before showing the property (which ever occurs first)- written disclosures must be kept for 5 years |
| transaction broker duties | fs 475.278-deal honesty & fairly; disclose all known facts that materially affect the value of the property; account for all funds; use skill care & diligence; present all offers & counter offers; limited confidentiality; additional duties as agreed |
| single agent duties | fs 475-deal honestly & fairly; disclose all known facts that materially affect the value of the property; account for all funds; use skill, care & diligence; present all offers & counter offers; loyalty; full confidentiality; obedience; full disclosure |
| no brokerage relationship | fs 475- deal honestly & fairly; disclose all known facts that materially affect the value of the property; account for all funds |
| consent to transition to transaction broker notice | fs 475- single agent changes to transaction broker relationship; principle must give written consent; no written consent-licensee must remain single agent |
| designated sales associate | fs 475 non residential sale (as defined by fl) both parties request single agency representation from same firm in same transaction; both parties must have assets 1,000,000 or more; broker assigns one agent to represent buyer & another to represent seller |
| principal | employer of a single agent |
| dual agency | one licensee represents both buyer & seller; in the same transaction; as a single agent; illegal in the state of florida |
| fiduciary duties | fs 475.01 duties owed to a principal in single agency; principal can sue licensee if these duties are breached; may bring criminal penalties by attorney general |
| presenting offers | licensee must transmit any & all offers; written & verbal; offers without a deposit; charged with concealment if failure to present |
| find a purchaser (listing contract) | commission is due once sales contract is signed |
| effect a sale (listing contract) | commission is not due until title transfers (closing) |
| payment of commission | licensee can only be paid by their broker/owner- developer; broker may give written permission for closing agent to pay licensee @ closing; licensee not paid- can only sue employer-not public |
| overage or secret profit | illegal for broker to receive more than customary profit; unless employer is informed |
| illegal kickback | frec rule 61J2- commission & additional fee paid to licensee; without all parties knowledge; without proper license; for which no service was performed; regulated by the respa |
| legal kickback | frec 61J2- commission & additional fee paid to licensee; all parties to the transaction are informed; with proper license if require; an actual service was performed; regulated by the respa |
| referral fee to licensees | fs 475.25/ frec rule 61J2 may share commission with out parties knowledge or permission; recipient must have active license in another state or country; if not a fla licensee- may participate in the transaction |
| referral fee to non-licnsees | fs 475.25/ frec 61J2-10.028 licensee may not share commission with unlicensed parties; may share commission to unlic parties; may share commission to unlic party to the transaction; with full disclosure to all interested parties |
| relationships document retention | fs 475.5015 residential relationship disclosure documents; must be kept in files for 5 years; for all written contracts; even if transaction doesn't close |
| multiple listing service (mls) | member- broker organization; brokers agree to place all listings in mls; listing brokers offer commission split to selling brokers called "cooperating" brokers |
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dmboo
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