Florida Real Estate Brokers Guide Sixth Edition Linda

Unit 1 Becoming A Licensed Real Estate Broker

Becoming a Broker • A person who, for another and for compensation (or anticipation of compensation) performs real estate services • Broker associates hold a broker’s license but choose to register and work under the direction of another broker 3 © 2017 Kaplan, Inc.

Sales Associates and Broker Associates • Agents of their employer • Sales associates and broker associates are employed by and work under the direction and control of a – Broker – Owner-developer • Entity selling its own property (not licensed by DBPR) • Persons not licensed by DBPR may be employed by a owner-developer if paid salary (no commission) 4 © 2017 Kaplan, Inc.

Application Process • • • 18 years of age or older High school diploma (or equivalent) Possess a Social Security number Be honest, truthful, trustworthy Be competent and qualified – Application expires two years after receipt by the DBPR 5 © 2017 Kaplan, Inc.

DBPR’s Military Veteran and Spouse Fee Waiver • Initial application, license, and unlicensed activity fees waived for military veterans and their spouses who apply within 60 months after honorable discharge 6 © 2017 Kaplan, Inc.

U. S. Social Security Number • U. S. citizenship is NOT required • U. S. Social Security number required for all professional licenses – Enter name on application as shown on Social Security card – Number is used to determine whether applicants are in compliance with child support obligations 7 © 2017 Kaplan, Inc.

Application Processing • 30 days to check for errors and omissions • Informed of approval (denial) within 90 days – If denied, applicant has 21 days to request a hearing under F. S. 120 8 © 2017 Kaplan, Inc.

Nonresident Applicants • Florida residency is NOT required • Florida resident is a person who has resided in Florida continuously for four calendar months or more within the preceding year 9 © 2017 Kaplan, Inc.

Criminal Background Check • Disclosure about past history – Disclose if convicted, found guilty, plead guilty or nolo contendere to crime • Even if adjudication was withheld • Attach details about the case 10 © 2017 Kaplan, Inc.

Prelicense Education Requirement • Florida sales associates must complete 45 -hour post-licensing education course • FREC Course II – 69 hours plus 3 for exam • End of course exam – 45 questions on law – 40 questions on principles – 15 math questions (8 points is Closing Disclosure) 11 © 2017 Kaplan, Inc.

Exceptions to Broker Prelicense Course • Persons with a four-year degree or higher in real estate are exempt from prelicense course • Active members of the Florida Bar are NOT exempt from broker prelicense course – They are exempt from sales associate prelicense course 12 © 2017 Kaplan, Inc.

Summary of Education Exemptions • Persons with 4 -year degree or higher in real estate are – Exempt from sales associate prelicense course – Exempt from broker prelicense course – Exempt from sales associate and broker postlicense courses – NOT exempt from continuing education 13 © 2017 Kaplan, Inc.

Summary of Education Exemptions • Active members of The Florida Bar are – Exempt from sales associate prelicense course – NOT exempt from sales associate post-license course – NOT exempt from broker prelicense course – NOT exempt from broker post-license course – Exempt from continuing education 14 © 2017 Kaplan, Inc.

Mutual Recognition • Agreements with other states with similar education and experience requirements – Apply exclusively to NONRESIDENTS of Florida – Submit certificate of license history from other state – Exempt from pre-license education course • 40 -question Florida real estate law exam – 75% correct to pass • Must complete post-license education © 2017 Kaplan, Inc. 15

Mutual Recognition Is Not Reciprocity • Reciprocity is an agreement between two states that allows a real estate licensee with a valid license in one of the states to practice in both states – Florida does NOT have reciprocity with any other state • Mutual recognition agreements between states recognize each others education and experience 16 © 2017 Kaplan, Inc.

Experience Requirement • At least 24 months active experience within past 5 years – As a sales associate for a broker in Florida or any other state or nation – As a sales associate employee of a government agency – As a broker in another state or nation – Experience CANNOT be earned by working for an owner-developer (unless employer holds an active broker license) 17 © 2017 Kaplan, Inc.

Post-Licensing Education • Required before first renewal of license • 60 -hour course – 100 -question end-of-course exam – 75% correct to pass – Four-year or higher degree in real estate exempt from post-license education – Attorneys are NOT exempt • Failure to complete by first expiration date license is null and void 18 © 2017 Kaplan, Inc.

Hardship Cases • FREC may allow real estate licensees an additional six-month period following the initial license expiration to complete the postlicense education if, due to individual physical hardship, they could not comply prior to expiration of license • Request with documentation made in writing to the FREC 19 © 2017 Kaplan, Inc.

Continuing Education • 14 hours during each two-year license period – May substitute attendance at a legal agenda session of the FREC for 3 hours of CE credit • 3 hours must be core law – If licensee completes core law each year, six hours of CE credit • Active members of The Florida Bar are exempt from CE requirements 20 © 2017 Kaplan, Inc.

License Renewal Periods • Two-year renewal period – Licenses expire on March 31 or September 30 – Must renew prior to expiration date – Post-license or continuing education requirement must be completed – License reverts automatically to involuntary inactive status – Unlicensed practice of real estate following expiration of license 21 © 2017 Kaplan, Inc.

Armed Forces Exemption • A licensee in good standing who is a member of the U. S. Armed Forces is exempt from renewal requirements during active duty and for six months after discharge from active duty – If the military duty is out of state, the exemption also applies to a licensed spouse 22 © 2017 Kaplan, Inc.

Temporary License • DBPR may issue a temporary license to spouse of an active duty member of the Armed Forces assigned to duty in Florida – Spouse must hold valid real estate license in another state – Temporary license expires six months after the date of issue and is NOT renewable 23 © 2017 Kaplan, Inc.

Active vs. Inactive Status • Active license required to perform services of real estate • Two types of inactive status – Voluntary inactive • When a licensee has applied to the Department to be placed on inactive status and has paid the fee – Involuntary inactive • When a license is not renewed at the end of the license period 24 © 2017 Kaplan, Inc.

Involuntary Inactive • If a licensee fails to renew before the expiration date (other than the first renewal), the license reverts automatically to involuntary inactive status • License that has been involuntary inactive – 12 months or less, complete 14 hours of CE and pay the late fee – More than 12 months but less than 24 months, complete 28 hours of reactivation education and pay late fee © 2017 Kaplan, Inc. 25

Another Involuntary Inactive Status • If a broker’s license is suspended or revoked for disciplinary reasons, – Sales associates’ and broker associates’ licenses employed by that broker are automatically placed in involuntary inactive status – Sales associates and broker associates may become active again under a new employer 26 © 2017 Kaplan, Inc.

Registration and Licensure • Registration is placing on record with the DBPR the name and address – – of each licensed broker and sales associate name and business address of sales associate’s employer active or inactive license status involvement in a real estate entity • Brokers must register involvement in any brokerage entity in non-brokerage capacity • Individuals are licensed/businesses are registered 27 © 2017 Kaplan, Inc.

Multiple Licenses • Multiple licenses are issued to a broker who qualifies as the broker for more than one business entity • For each business that a person is a broker, a separate broker license must be obtained • Each license must be used as a broker, not broker associate 28 © 2017 Kaplan, Inc.

Group License • Group licenses are issued to sales associates and broker associates who register under an owner-developer (real estate developer) • Owner-developer sends DBPR list of legal company names • Sales associate or broker associate has: – One license – One employer © 2017 Kaplan, Inc. 29

Change of Address • The current residential address a licensee uses to receive mail • 10 days to notify the DBPR of change of address ($500 fine for failing to timely notify) • P. O. box is acceptable mailing address • Address of record • Mailing or e-mail address 30 © 2017 Kaplan, Inc.

Change of Residency • Florida resident licensee who moves out of state and becomes a nonresident must notify FREC within 60 days of the change in residency • Must keep mailing address current with DBPR • Nonresident licensees must comply with post-license and CE requirements © 2017 Kaplan, Inc. 31

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Presumption of Acting as a Real Estate Broker • If an individual performs services of real estate for another and a disciplinary case is filed, there is a presumption that the individual acted as a licensee • Burden of proof is on the individual to show that he is not acting or attempting to act as a broker or a sales associate 33 © 2017 Kaplan, Inc.

Individuals Who Are Exempt from a Real Estate License • Owners of property may buy, sell, exchange or lease their own property – Individual property owners – Corporations, partnerships, trusts, and joint ventures – Salaried employees of those business entities – A partner in a real estate partnership can receive a pro rata share of profits 34 © 2017 Kaplan, Inc.

Exemptions from Licensure • Salaried employees – Who work in an on-site rental office in a leasing capacity who do not receive commission – Who are managers of condos and cooperative apartments who rent units for no longer than one year and do not receive commission – Of an owner-developer (real estate developer) who do not receive commission – Of a government agency and perform services for that agency and do not receive a commission – Of business entities who negotiate sale of radio, TV, or cable enterprises but not real property 35 © 2017 Kaplan, Inc.

Other Exemptions from Licensure • Persons who sell cemetery lots • Individuals who rent lots in a mobile home park or travel park • Attorneys-at-law and CPAs (cannot be compensated for real estate services) • Attorneys-in-fact (power of attorney) • Owners of time-share periods • State-certified and licensed appraisers • Court-appointed individuals 36 © 2017 Kaplan, Inc.

Additional Exemptions from Licensure • Hotel and motel clerks who rent transient lodging • Federally regulated banks and securities dealers selling business enterprises • Apartment owners or property managers to pay a finder’s fee to a tenant (maximum of $50) 37 © 2017 Kaplan, Inc.