28 Florida State Law (FREC) Practice Questions & Answers

1. 1. Which state agency and its division are responsible for administering and enforcing Florida's real estate license law under Chapter 475?

   • A.The Department of Financial Services, through the Division of Consumer Services
   • B.The Department of Business and Professional Regulation, through the Division of Real Estate✓ Answer
   • C.The Florida Department of Revenue, through the Division of Property Tax
   • D.The Florida Department of State, through the Division of Corporations

   Real estate licensing in Florida is housed in the DBPR, and its Division of Real Estate provides administrative support to the Florida Real Estate Commission (FREC), which regulates licensees under Chapter 475.

   Ref QB-UCGFUVSource: Fla. Stat. Ch. 475; DBPR / Division of Real EstateReport a problem with this question

2. 2. What is the primary role of the Florida Real Estate Commission (FREC)?

   • A.To set and collect property taxes on real estate transactions
   • B.To approve mortgage loans for buyers of Florida real estate
   • C.To adopt rules, and administer and enforce Chapter 475 for real estate licensees✓ Answer
   • D.To act as the mandatory escrow holder for all real estate deposits in the state

   FREC is the regulatory body created under Chapter 475 to adopt administrative rules (Rule 61J2), license qualified applicants, and discipline licensees; it does not hold escrow, set taxes, or make loans.

   Ref QB-DVZXKXSource: Fla. Stat. 475.02; 475.05 (FREC powers and duties)Report a problem with this question

3. 3. Under Florida law, when no brokerage relationship is established in writing, how is a licensee presumed to be operating?

   • A.As a designated sales agent
   • B.As a single agent for the seller
   • C.As a dual agent for both parties
   • D.As a transaction broker✓ Answer

   Section 475.278 creates a statutory presumption that all licensees operate as transaction brokers unless a single agent or no-brokerage relationship is established in writing with the customer.

   Ref QB-VCUSZWSource: Fla. Stat. 475.278(1)(b) (presumption of transaction brokerage)Report a problem with this question

4. 4. Which duty is owed to a customer by a single agent but NOT by a transaction broker in Florida?

   • A.Dealing honestly and fairly
   • B.Accounting for all funds
   • C.Loyalty and obedience✓ Answer
   • D.Disclosing material facts not readily observable

   Loyalty and obedience are fiduciary duties unique to the single agent relationship; the other three duties are shared by both single agents and transaction brokers under Section 475.278.

   Ref QB-EVCASYSource: Fla. Stat. 475.278(3)(a) (single agent duties) vs. 475.278(2)(a) (transaction broker duties)Report a problem with this question

5. 5. A Florida single agent wishes to change to a transaction broker relationship with the same customer during a transaction. What is required first?

   • A.A new state examination for the licensee
   • B.The customer's written consent✓ Answer
   • C.Written approval from FREC before the change
   • D.Notice to the other party's broker only

   Section 475.278 permits a single agent to transition to a transaction broker only after the customer signs the statutory Consent to Transition to Transaction Broker notice, so the change to reduced representation is informed and voluntary.

   Ref QB-WC757YSource: Fla. Stat. 475.278(3)(c) (consent to transition to transaction broker)Report a problem with this question

6. 6. Which brokerage relationship is expressly prohibited for real estate licensees in Florida?

   • A.No brokerage relationship
   • B.Transaction brokerage
   • C.Single agency for the buyer
   • D.Dual agency✓ Answer

   Section 475.278 states a licensee may not operate as a disclosed or nondisclosed dual agent; Florida instead uses the transaction broker model when a licensee works with both parties.

   Ref QB-FVQMXZSource: Fla. Stat. 475.278(1)(a) (dual agency prohibited)Report a problem with this question

7. 7. When must a single agent provide the single agent disclosure to a prospective residential customer?

   • A.Within 30 days after the contract is signed
   • B.Only at the closing table
   • C.By the earlier of a representation agreement or showing✓ Answer
   • D.Only if the customer specifically requests it in writing

   The single agent disclosure must be made in writing before or at the time of entering a listing or representation agreement or before showing property, whichever occurs first, so the customer understands the relationship early.

   Ref QB-XCJFCZSource: Fla. Stat. 475.278(3)(b) (timing of single agent disclosure)Report a problem with this question

8. 8. In residential transactions, how must Florida's required brokerage relationship disclosures generally be presented in the document?

   • A.In small footnote text at the end of the contract
   • B.Only in a separate email sent after closing
   • C.In writing, in a prominent location, in uppercase and bold type✓ Answer
   • D.Verbally, with no written record required

   Section 475.278 requires the single agent and transition disclosures to be in writing, placed prominently in the document, and set in uppercase and bold type so the consumer cannot easily overlook them.

   Ref QB-GV3Y43Source: Fla. Stat. 475.278(4)(a) (format of required disclosures)Report a problem with this question

9. 9. Under Florida rules, a broker who holds escrow must place a deposit into the trust account no later than the end of which business day after receiving it?

   • A.The end of the first calendar week
   • B.The end of the same day
   • C.The end of the third business day✓ Answer
   • D.The end of the tenth business day

   FREC rules define 'immediately' as no later than the end of the third business day following receipt of the funds, and Saturdays, Sundays, and legal holidays are not counted as business days.

   Ref QB-YCWSH2Source: Rule 61J2-14.008/14.009, F.A.C. (deposit within 3 business days)Report a problem with this question

10. 10. A Florida broker holding an escrow deposit receives conflicting demands from the buyer and seller. What must the broker do first under FREC rules?

    • A.Keep the deposit indefinitely without notifying anyone
    • B.Immediately release the deposit to whichever party demands it loudest
    • C.Split the deposit equally between buyer and seller without further steps
    • D.Notify FREC in writing on time, then use a statutory settlement procedure✓ Answer

    When faced with conflicting demands on escrowed funds, the broker must timely notify FREC and then institute one of the statutory settlement procedures (mediation, arbitration, litigation, or an escrow disbursement order) rather than deciding the dispute unilaterally.

    Ref QB-45ZHFZSource: Fla. Stat. 475.25(1)(d); Rule 61J2-10.032, F.A.C. (conflicting demands / escrow settlement procedures)Report a problem with this question

11. 11. Under Chapter 475, a Florida sales associate must perform all licensed real estate activities under what condition?

    • A.Registered under and acting for a single licensed broker✓ Answer
    • B.Under the direct supervision of FREC staff
    • C.Only after also holding a broker license
    • D.As a fully independent principal with no supervising broker

    A sales associate cannot operate independently; Chapter 475 requires the associate to be registered under and work only for one broker (or an owner-developer or government agency) who is responsible for supervising their activities.

    Ref QB-MM6Q22Source: Fla. Stat. 475.01; 475.42(1)(b) (sales associate must work under one broker)Report a problem with this question

12. 12. Which action may a Florida sales associate NOT legally do?

    • A.Be paid directly by a customer, not through their broker✓ Answer
    • B.Show listed property to a prospective buyer
    • C.Hold open houses on behalf of their broker
    • D.Prepare an offer for a buyer to submit

    Chapter 475 provides that a sales associate may only be compensated by the broker under whom they are registered; collecting a fee directly from a customer or another party is prohibited and is grounds for discipline.

    Ref QB-55CVM2Source: Fla. Stat. 475.42(1)(d) (sales associate may be paid only by their broker)Report a problem with this question

13. 13. What is the defining characteristic of a transaction broker's confidentiality duty in Florida?

    • A.No confidentiality at all, since a transaction broker must disclose everything to both sides
    • B.Limited confidentiality, unless waived in writing✓ Answer
    • C.Confidentiality that applies only to the seller, never the buyer
    • D.Absolute, fiduciary-level confidentiality identical to a single agent

    A transaction broker owes only limited confidentiality: specific facts such as that a seller will accept less or a buyer will pay more must be kept confidential unless a party waives it in writing, which distinguishes it from a single agent's full confidentiality.

    Ref QB-NMH283Source: Fla. Stat. 475.278(2)(a) (transaction broker duty of limited confidentiality)Report a problem with this question

14. 14. A Florida broker receives conflicting demands from a buyer and seller over an earnest-money deposit held in the broker's escrow account. Within what time must the broker notify the Florida Real Estate Commission (FREC) of the conflicting demands?

    • A.Within 24 hours
    • B.Within 30 calendar days
    • C.Within 10 business days
    • D.Within 15 business days✓ Answer

    Florida Administrative Code Rule 61J2-10.032 requires a broker with conflicting demands or good-faith doubt over escrowed funds to notify FREC within 15 business days, and then to institute one of the settlement procedures (mediation, arbitration, escrow disbursement order, or litigation) within 30 business days.

    Ref QB-PMVCD4Source: Fla. Admin. Code R. 61J2-10.032 (notice requirements); Fla. Stat. 475.25(1)(d)Report a problem with this question

15. 15. A newly licensed Florida real estate sales associate must complete FREC-approved post-licensing education before the first license renewal. How many hours are required, and failing to complete them by the deadline has what effect on the license?

    • A.30 hours; a late fee is assessed but the license stays active
    • B.60 hours; the license reverts to inactive status
    • C.14 hours; the license is suspended for 6 months
    • D.45 hours; the license becomes null and void✓ Answer

    Florida sales associates must complete 45 hours of FREC-approved post-licensing education before their first renewal; because there is no grace period, missing the deadline renders the license null and void, and the person must requalify by retaking the pre-license course and state exam.

    Ref QB-753JY4Source: Fla. Stat. 475.17(3); Fla. Admin. Code R. 61J2-3.009 (post-licensing education)Report a problem with this question

16. 16. Sales associate Dana missed her renewal deadline, so her license is now involuntarily inactive. She keeps showing homes and negotiating offers for her broker's buyers. How does Florida law treat this conduct?

    • A.Permitted during a grace period until she renews
    • B.Unlawful because she lacks an active license✓ Answer
    • C.Unlawful only if her broker stops supervising her
    • D.Permitted until the license becomes null and void

    Florida law prohibits anyone from operating as a broker or sales associate without a valid and current ACTIVE license, and an involuntarily inactive license is not active, so every brokerage act Dana performs is unlicensed activity (a criminal violation under s.475.42). There is no grace period for practicing: she must first meet the reactivation requirements and renew. Broker supervision does not cure the lack of an active license, and the later 'null and void' stage only describes when the license ceases to exist; it never authorizes practice in the meantime.

    Ref QB-QM8QJ5Source: Fla. Stat. 475.42(1)(a) and (2); Fla. Stat. 475.182 (renewal, involuntary inactive status)Report a problem with this question

17. 17. Luis holds a Florida broker license but decides to work for an established brokerage under that firm's employing broker instead of opening his own office. How is Luis registered?

    • A.As a broker associate✓ Answer
    • B.As a transaction broker
    • C.As a sales associate
    • D.As an owner-developer

    Chapter 475 defines a broker associate as a person who is a broker, or qualified to be one, but who operates as a sales associate in the name of an employing broker, which is exactly Luis's situation. He is not simply a 'sales associate' because he holds the higher broker license; 'transaction broker' is a brokerage relationship with a customer, not a license registration, and an owner-developer is an employer category, not Luis's status.

    Ref QB-85EV56Source: Fla. Stat. 475.01(1) (definition of 'broker associate')Report a problem with this question

18. 18. Sales associate Priya earned a commission on a sale while working for Broker A. Before the closing, she transferred her license to Broker B. The sale then closes. From whom may Priya lawfully receive that commission?

    • A.Broker A, who employed her when it was earned✓ Answer
    • B.Broker B, her employer at the closing date
    • C.The seller, paid directly at the closing table
    • D.The closing agent, by a check in her own name

    A Florida sales associate may collect compensation only in the name of, and with the consent of, the employing broker, and may sue for it only against the person registered as her employer at the time she performed the services. Priya did the work while registered with Broker A, so Broker A receives the commission and pays her share. Broker B had no part in earning it, and direct payment from the seller or closing agent would bypass the broker in violation of s.475.42(1)(d).

    Ref QB-RMK2R6Source: Fla. Stat. 475.42(1)(d)Report a problem with this question

19. 19. A Florida brokerage hires an unlicensed personal assistant. Which task may the assistant perform without a license?

    • A.Set up showing times for licensees✓ Answer
    • B.Show a listed home to a walk-in buyer
    • C.Negotiate price with a buyer's agent
    • D.Discuss contract terms with a buyer

    Florida requires a license for anyone who, for another and for compensation, sells, negotiates, or otherwise performs the services listed in s.475.01, and performing them unlicensed is a crime under s.475.42. Scheduling appointments is clerical support that does not involve negotiating or advising, so an unlicensed assistant may do it. Showing a property to a buyer is the strongest trap: it is part of the brokerage service of selling and must be done by a licensee, as must negotiating price and explaining contract terms.

    Ref QB-BMRRZWSource: Fla. Stat. 475.01(1)(a) and 475.42(1)(a); DBPR Division of Real Estate guidance on unlicensed personal assistantsReport a problem with this question

20. 20. After a failed sale, both the buyer and the seller send a Florida broker written demands for the same escrow deposit, and the broker has already notified FREC. Which step is an authorized way for the broker to resolve the dispute?

    • A.Split the deposit equally between the two parties
    • B.Release the deposit to the side the broker favors
    • C.Ask FREC to issue an escrow disbursement order✓ Answer
    • D.Keep the deposit until the parties stop arguing

    When a broker receives conflicting demands or has a good-faith doubt about who is entitled to escrowed funds, s.475.25(1)(d) and rule 61J2-10.032 allow only four settlement procedures: asking FREC for an escrow disbursement order, mediation, arbitration (with the parties' written consent), or litigation such as an interpleader action. Splitting the money or picking a side is a unilateral disbursement the broker has no authority to make, and simply holding the funds with no procedure underway fails the duty to institute one.

    Ref QB-T4KKEWSource: Fla. Stat. 475.25(1)(d)1; Fla. Admin. Code R. 61J2-10.032Report a problem with this question

21. 21. After a formal hearing on a complaint against a Florida sales associate, the administrative law judge submits a recommended order. Which body then issues the final order that may impose a reprimand, fine, probation, suspension, or revocation?

    • A.The Florida Real Estate Commission✓ Answer
    • B.The DBPR Division of Real Estate
    • C.A Florida District Court of Appeal
    • D.The judge at DOAH who heard the case

    In Florida's split system, DBPR (through its Division of Real Estate) receives complaints, investigates, and prosecutes, while FREC is the quasi-judicial body that issues the final order and chooses among the penalties in s.475.25: denial, reprimand, administrative fine, probation, suspension, or revocation. In a formal hearing the DOAH judge only writes a recommended order under ch. 120; the District Court of Appeal becomes involved only if the licensee appeals FREC's final order.

    Ref QB-CM447YSource: Fla. Stat. 475.25(1); Fla. Stat. 455.225; Fla. Stat. 120.57(1)(k)-(l)Report a problem with this question

22. 22. What is the main purpose of the Florida Real Estate Recovery Fund?

    • A.Insuring licensees against errors and omissions claims
    • B.Paying victims' unpaid judgments against licensees✓ Answer
    • C.Paying brokers commissions that sellers refused to pay
    • D.Funding scholarships for prelicense education students

    The Recovery Fund protects consumers: a person who obtains a court judgment for monetary damages caused by a licensee's violation of ch. 475 in a real estate brokerage transaction, and cannot collect it, may apply to the fund for payment, after which the licensee's license is automatically suspended until the fund is repaid with interest. It is not errors-and-omissions insurance that defends licensees, and it does not collect commissions for brokers.

    Ref QB-U4XWKXSource: Fla. Stat. 475.482, 475.483, 475.484Report a problem with this question

23. 23. Four creditors hold claims against a Florida homeowner who lives in her qualifying homestead. Which creditor can force a sale of the homestead to satisfy its claim?

    • A.A hospital holding a judgment for medical bills
    • B.The bank holding the home's purchase mortgage✓ Answer
    • C.A credit card issuer holding a money judgment
    • D.A former business partner holding a judgment

    Article X, section 4 of the Florida Constitution exempts homestead from forced sale under process of any court, except for taxes and assessments, obligations for the purchase, improvement, or repair of the property, and obligations for labor performed on it. A purchase-money mortgage falls within the purchase exception, so the bank can foreclose. Ordinary judgment creditors, such as a card issuer, a hospital, or a former partner, cannot reach the homestead no matter how large the judgment.

    Ref QB-DMFECZSource: Fla. Const. art. X, s. 4(a)Report a problem with this question

24. 24. A married Florida homeowner with a minor child signs a will leaving the family homestead entirely to his brother. He dies survived by his wife and the child. What happens to the homestead?

    • A.The brother takes it after estate debts are paid
    • B.The devise is invalid and the home descends by law✓ Answer
    • C.The home is sold and split among the three heirs
    • D.The brother takes the home subject to the wife's dower

    Under Fla. Const. art. X, s.4(c), homestead may not be devised if the owner is survived by a spouse or minor child, except to the spouse when there is no minor child. Because both survive, the will's gift to the brother fails and the home descends under s.732.401: the spouse takes a life estate (or may elect an undivided one-half interest as tenant in common) with the remainder to the descendants. Florida abolished dower, and homestead is not sold to pay ordinary estate debts.

    Ref QB-V4A9SYSource: Fla. Const. art. X, s. 4(c); Fla. Stat. 732.401, 732.4015Report a problem with this question

25. 25. A Florida homeowner has held a homestead exemption for several years. Under the Save Our Homes amendment, how much may the home's assessed value rise from one year to the next?

    • A.No more than the greater of 3% or the change in CPI
    • B.No limit; reassessed each year at full just value
    • C.No more than 2% per year until the home is sold
    • D.No more than the lesser of 3% or the change in CPI✓ Answer

    Article VII, section 4(d) of the Florida Constitution (Save Our Homes) limits annual increases in the assessed value of homestead property to the LESSER of 3% or the percentage change in the Consumer Price Index; the assessment resets to just value after a change of ownership. 'Greater of' reverses the rule, yearly reassessment at full just value is exactly what the cap prevents for a continuing owner, and a 2% cap is California's Proposition 13, not Florida law.

    Ref QB-EMTRH2Source: Fla. Const. art. VII, s. 4(d); Fla. Stat. 193.155Report a problem with this question

26. 26. A Florida licensee is preparing paperwork for a home sale and, separately, for a one-year apartment lease. Where must Florida's statutory radon gas notification appear?

    • A.Only where a radon test showed high levels
    • B.Only in documents for homes built before 1978
    • C.In both the sale contract and the lease✓ Answer
    • D.In the sale contract only, never in leases

    Section 404.056(5) requires the radon gas notification, in its statutory wording, on at least one document executed at or before the time of a contract for sale and purchase of any building OR the execution of a rental agreement for any building, so both the sale and the lease need it regardless of test results. The 1978 cutoff belongs to the federal lead-based paint disclosure, not to radon.

    Ref QB-W4NKXZSource: Fla. Stat. 404.056(5)Report a problem with this question

27. 27. A family with two young children believes a Miami landlord refused to rent to them because of the children. Under the Florida Fair Housing Act, which state agency receives and investigates their complaint?

    • A.The Florida Real Estate Commission (FREC)
    • B.The DBPR's Division of Real Estate staff
    • C.The Florida Housing Finance Corporation
    • D.The Florida Commission on Human Relations✓ Answer

    The Florida Fair Housing Act (ch. 760, Part II) protects familial status and directs that complaints of discriminatory housing practices be filed with the Florida Commission on Human Relations, which investigates and attempts conciliation (a complaint may also go to HUD). FREC and the DBPR Division of Real Estate regulate real estate licensees and could discipline a licensee separately, but they are not the agency that enforces the state fair housing law against a landlord; the Housing Finance Corporation finances affordable housing.

    Ref QB-7MBEBSSource: Fla. Stat. 760.23, 760.34(1) (Florida Fair Housing Act); Fla. Stat. 760.03 (Florida Commission on Human Relations)Report a problem with this question

28. 28. A seller in a Florida mandatory homeowners' association signs a purchase contract, but the buyer receives the required HOA disclosure summary only after signing. What right does the late delivery give the buyer?

    • A.The buyer may cancel the contract by written notice✓ Answer
    • B.The buyer must close but may recover damages later
    • C.The seller may cancel the contract by written notice
    • D.The contract is void and the deposit is forfeited

    Section 720.401 requires the HOA disclosure summary to be given before the buyer executes the contract; if it is not, the contract is voidable by the BUYER, who may cancel by written notice within a short statutory window after receiving the summary or before closing, whichever comes first, and any waiver of that right is void. The protection belongs to the buyer, so the seller gains no right to cancel, and the contract is voidable rather than automatically void (condominium resales under s.718.503 work similarly).

    Ref QB-P469RRSource: Fla. Stat. 720.401(1); Fla. Stat. 718.503(2)Report a problem with this question

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