Federal & State Laws: Free Florida Real Estate Practice Questions

1. 1. The federal Fair Housing Act of 1968, as amended, prohibits discrimination based on seven protected classes. Which of the following correctly lists all seven federally protected classes?

   • A) Race, color, religion, national origin, sex, familial status, and disability
   • B) Race, color, religion, national origin, sex, age, and marital status
   • C) Race, color, national origin, sex, disability, sexual orientation, and gender identity
   • D) Race, religion, familial status, disability, income level, age, and national origin
   Show answer & explanationHide answer

   Correct answer: A) Race, color, religion, national origin, sex, familial status, and disability

   The federal Fair Housing Act was enacted in 1968 with four original protected classes (race, color, religion, national origin) and expanded in 1974 to add sex and in 1988 to add familial status and disability. Age, marital status, sexual orientation, and gender identity are not federally protected classes under the Fair Housing Act (though some state and local laws add these protections). Florida's Fair Housing Act adds age and marital status as protected classes under state law.

2. 2. A real estate agent approaches homeowners in a neighborhood and tells them that families of a different ethnic background are moving in, urging them to sell quickly before property values decline. This Fair Housing violation is called:

   • A) Steering, which involves channeling buyers or renters to specific neighborhoods based on protected class
   • B) Blockbusting (panic peddling), inducing owners to sell by exploiting fears about protected class members entering the area
   • C) Tying, the illegal conditioning of a real estate service on acceptance of an additional unwanted service
   • D) Redlining, the lender practice of refusing mortgage loans in neighborhoods based on racial composition
   Show answer & explanationHide answer

   Correct answer: B) Blockbusting (panic peddling), inducing owners to sell by exploiting fears about protected class members entering the area

   Blockbusting, also called panic selling or panic peddling, involves inducing homeowners to sell by suggesting that protected-class members are moving or about to move into the neighborhood and that property values will decline as a result. It violates both the Fair Housing Act and Chapter 475. The licensee profits by listing and reselling the panic-sold homes. Steering involves directing buyers to certain areas; redlining involves financial institutions denying services; tying is an antitrust concept.

3. 3. The Equal Credit Opportunity Act (ECOA) applies to lenders and creditors in residential mortgage transactions. The primary purpose of ECOA is to:

   • A) Require lenders to provide borrowers with a good faith estimate of closing costs within 3 business days of loan application
   • B) Establish maximum interest rates that mortgage lenders may charge on federally regulated loans
   • C) Prohibit discrimination in the extension of credit based on protected characteristics including race, sex, national origin, age, marital status, and receipt of public assistance
   • D) Require lenders to escrow property taxes and insurance premiums and provide annual escrow account disclosures to borrowers
   Show answer & explanationHide answer

   Correct answer: C) Prohibit discrimination in the extension of credit based on protected characteristics including race, sex, national origin, age, marital status, and receipt of public assistance

   ECOA prohibits creditors from discriminating against applicants on the basis of race, color, religion, national origin, sex, age (provided the applicant is old enough to contract), marital status, or receipt of public assistance. Under ECOA, lenders must notify applicants of adverse credit decisions within 30 days. ECOA protects credit applicants; the Loan Estimate/closing cost estimate requirement comes from TRID (TILA-RESPA); rate caps are set by state law; escrow disclosures are governed by RESPA.

4. 4. Under the federal Truth in Lending Act (TILA), a borrower has a right of rescission -- the right to cancel a loan -- within 3 business days of consummation. This right applies to:

   • A) All federally related mortgage loans, including purchase money mortgages on primary residences
   • B) Refinances and home equity loans secured by the borrower's principal residence, but NOT to original purchase money mortgages
   • C) Only adjustable-rate mortgages (ARMs) because of the inherent rate uncertainty
   • D) All consumer loans made by federally insured financial institutions regardless of purpose
   Show answer & explanationHide answer

   Correct answer: B) Refinances and home equity loans secured by the borrower's principal residence, but NOT to original purchase money mortgages

   TILA's right of rescission (3 business days to cancel) applies to non-purchase money credit transactions secured by a consumer's principal dwelling -- such as refinances, home equity loans, and home equity lines of credit. It does NOT apply to original purchase money mortgages used to buy the home, because the legislature did not want to enable buyers to walk away from closings after taking possession. The 3-day right is designed to protect homeowners from high-pressure refinancing and equity-stripping tactics.

5. 5. Under the federal Fair Housing Act, what is the maximum civil penalty the Department of Justice may seek in federal court for a pattern or practice of discrimination or for violations affecting the public interest?

   • A) $5,000 for a first offense, $15,000 for a second, $25,000 for subsequent violations
   • B) No limit; the court may impose any penalty it deems appropriate based on the severity of the violations
   • C) Up to $16,000 for a first violation and up to $65,000 for a third or subsequent violation within 7 years, in HUD administrative proceedings; federal court actions may seek unlimited damages
   • D) $50,000 for a first offense, with no statutory maximum for subsequent violations
   Show answer & explanationHide answer

   Correct answer: C) Up to $16,000 for a first violation and up to $65,000 for a third or subsequent violation within 7 years, in HUD administrative proceedings; federal court actions may seek unlimited damages

   In HUD administrative proceedings, the Fair Housing Act authorizes civil penalties of up to $16,000 for a first violation and up to $65,000 for a third or subsequent violation within 7 years. However, when the DOJ brings a federal court action for a pattern or practice of discrimination or violations affecting the general public, courts may impose unlimited compensatory and punitive damages plus civil penalties. Complainants may also file private suits in federal court within 2 years of the discriminatory act.

6. 6. Florida's Residential Landlord and Tenant Act (F.S. 83) requires a landlord who holds a tenant's security deposit to return it within how many days if no claim is made against the deposit?

   • A) 7 days of the tenant vacating the premises
   • B) 30 days of the tenant vacating the premises
   • C) 45 days of the tenant vacating the premises
   • D) 15 days of the tenant vacating the premises when no deductions are claimed
   Show answer & explanationHide answer

   Correct answer: D) 15 days of the tenant vacating the premises when no deductions are claimed

   Under F.S. 83.49(3)(a), if the landlord does not intend to make any claim against the security deposit, the full deposit must be returned to the tenant within 15 days of the tenant vacating. If the landlord intends to make a claim, written notice must be sent to the tenant within 30 days. Failure to send timely notice forfeits the landlord's right to retain any portion of the deposit. Understanding the distinction between the 15-day return deadline and the 30-day notice deadline is essential for the exam.

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.