Brokerage Activities & Procedures: Free Florida Real Estate Practice Questions

1. 1. A real estate broker's main office entrance sign must display which of the following?

   • A) The brokerage name (or trade name) and a designation such as 'Licensed Real Estate Broker'
   • B) The broker's DBPR license number and the firm's trade name
   • C) The names of all licensed sales associates employed at that office
   • D) The qualifying broker's personal name only, regardless of any registered trade name
   Show answer & explanationHide answer

   Correct answer: A) The brokerage name (or trade name) and a designation such as 'Licensed Real Estate Broker'

   Under F.S. 475.22(1), each brokerage office must display a sign at the entrance showing the brokerage name or registered trade name along with a designation such as 'Licensed Real Estate Broker' or 'Lic. Real Estate Broker.' The license number and individual associate names are not required on the entrance sign. If the broker operates under a registered trade name, the trade name -- not necessarily the broker's personal name -- satisfies the name requirement.

2. 2. A buyer hands an earnest money check directly to a broker on Monday. By what deadline must the broker deposit those funds into the escrow account?

   • A) By the close of business on Monday (the same day)
   • B) By the close of business on Tuesday (the next business day)
   • C) By the close of business on Thursday (the third business day following receipt)
   • D) Within five calendar days of receipt
   Show answer & explanationHide answer

   Correct answer: C) By the close of business on Thursday (the third business day following receipt)

   Florida law requires a broker to deposit trust funds into an escrow account no later than the end of the third business day following the broker's receipt of the funds. If the broker receives the check on Monday (day 0), the third business day is Thursday. Note the 1-3 rule: when a sales associate receives the check, the associate must deliver it to the broker by end of the next business day (day 1); the broker then has until end of the third business day from the associate's receipt to deposit (day 3). Depositing earlier is permissible; five calendar days would exceed the legal deadline.

3. 3. Several competing brokers meet at a trade association breakfast and agree that all of their firms will charge a 6% commission on residential sales. This arrangement is:

   • A) Legal, provided the agreement is voluntary and not in writing
   • B) Legal if all participating brokers are members of the local REALTOR association
   • C) Legal, but must be approved by FREC before implementation
   • D) Illegal price fixing in violation of the Sherman Antitrust Act
   Show answer & explanationHide answer

   Correct answer: D) Illegal price fixing in violation of the Sherman Antitrust Act

   Competing brokers agreeing to charge the same commission rate constitutes horizontal price fixing, which is a per se violation of the Sherman Antitrust Act. Such an agreement is illegal regardless of whether it is voluntary, written, or industry-association-sanctioned. FREC has no authority to approve arrangements that violate federal antitrust law. Commissions must always be independently set by each brokerage.

4. 4. A broker refers buyers exclusively to a particular title company in exchange for a $200 monthly marketing fee paid by that title company. This arrangement most likely violates:

   • A) The Florida Fair Housing Act
   • B) The Sherman Antitrust Act's ban on tying arrangements
   • C) Florida Statute 475's requirement of written disclosure only
   • D) RESPA's prohibition on kickbacks and unearned referral fees
   Show answer & explanationHide answer

   Correct answer: D) RESPA's prohibition on kickbacks and unearned referral fees

   The Real Estate Settlement Procedures Act (RESPA) prohibits giving or receiving any fee, kickback, or thing of value in exchange for referring settlement service business (such as title insurance). A monthly marketing fee paid in exchange for directing buyers to a specific title company constitutes an illegal kickback under RESPA, regardless of how it is labeled or whether it is disclosed.

5. 5. Two individuals form a general partnership to operate a real estate brokerage in Florida. Which of the following statements is CORRECT regarding licensing?

   • A) Both partners must each hold an active Florida broker's license
   • B) At least one partner must hold an active Florida broker's license
   • C) Neither partner needs a broker's license if the partnership itself is licensed
   • D) A sales associate's license is sufficient for a partner who will actively list and sell property
   Show answer & explanationHide answer

   Correct answer: B) At least one partner must hold an active Florida broker's license

   Florida law requires that at least one partner in a real estate brokerage partnership hold an active broker's license. The remaining partners are not required to be licensed unless they personally perform acts of real estate (listing, selling, negotiating). A sales associate license is insufficient to qualify a partner as the responsible party for the brokerage.

6. 6. A sole proprietor broker wants to use the trade name 'Harrison & Associates Realty.' For this trade name to be permissible under Florida law, the broker must:

   • A) Have at least two licensed real estate associates actively employed at the firm
   • B) Have a co-owner named Harrison who is also a licensed broker
   • C) Obtain a special exception from FREC for use of the word 'Associates'
   • D) Register the trade name with both the DBPR and the Florida Bar before use
   Show answer & explanationHide answer

   Correct answer: A) Have at least two licensed real estate associates actively employed at the firm

   Under Florida's general false advertising prohibition (Rules 61J2-10.025 and 61J2-10.034), a brokerage trade name must not misrepresent the size or nature of the firm. Using the word 'Associates' in a trade name when the broker has no licensed associates employed would be false and misleading to the public. To use a name implying an associate staff, the broker must actually employ the associates the name implies. A co-owner named Harrison is not required, nor is any special FREC exception beyond standard trade name registration. The Florida Bar has no role in real estate trade name registration.

Not affiliated with Pearson VUE, the Florida DBPR, or FREC. This is an independent study tool; questions are original and verified against Florida statutes and FREC rules.