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    • Sales Associate Pre-license Workshop
    • Reasons to Become a Real Estate Agent  You are your own boss  Minimal Start Up Cost  Flexible Hours  Freedom to work when and where you want  Can raise a family and work without sacrificing either  Unlimited Earnings Potential
    • Licensing Requirements  Be eighteen years of age or older  High School Diploma or equivalent (G.E.D.)  Complete 63 hours Sales Associate Prelicense Course  Pass Pre-license Course Exam with a minimum grade of 70%  Submit state application and fingerprints  Apply for and pass state exam with minimum grade of 75%
    • Getting a License Application through State www.MyFloridaLicense.com Fingerprinting required www.pearsonvue.com 1-877-238-8232
    • Getting Started The Course Internet based approved by FREC Corresponding Textbook Live Workshop
    • Internet Based Course  63 hour Pre-license Course  FREC approved for CareerQuest  Login-Logout No time requirement  Audio on most pages  End-of-chapter Quizzes 100% score  End of course exam timed for 3 hours  Download end of course report
    • Textbook  Corresponding Textbook  Approved by FREC  Contains answer key
    • Live Workshop Not required, tutorial only Great Review Q & A No test
    • Chapter One Introduction to the Real Estate Business  Describe various activities of real estate brokerage  Know the five major sales specialties  Know the difference between CMA and Appraisal  Know the 3 phases of construction
    • Chapter One Review  Farming is a great way to develop a real estate business  Property management is popular because of absentee ownership  Appraisers must be state certified and follow strict USPAP guidelines  Developers turn over roads and infrastructure to government through dedication  Spec building: to build with hopes of selling  Custom building: build to owners plans
    • Chapter Two License Law & Qualifications  Know qualifications for sales associate license  Understand the application process  Know the educational requirements  Distinguish the different license categories  Know the services of real estate  Know the exemptions  Understand Mutual Recognition
    • Chapter Two Review  Associates can work for either brokers or owner- employers  Applicant must be 18 years old with high school diploma or equivalent  Must disclose any convictions  Approved application is good for 2 years  Irrevocable Consent to Service for out of state licensees (60 days after move out)  2 License: broker and sales associate  Broker Associate is broker working as associate  BAR SALE
    • Chapter Three License Law & FREC  Know the composition of FREC  Know the powers and duties of FREC  Distinguish the difference between void and ineffective  Understand how a license becomes involuntary inactive
    • Chapter Three Review  7 members on FREC: 5 licensed & 2 unlicensed  FREC appointed by Governor confirmed by state Senate for 4-year term  Can’t serve more than 2 consecutive terms  Involuntary inactive: fail to renew or employing broker has license suspended or revoked by FREC  Broker fails to notify DBPR of office move within 10 days, license will “cease to be in force”  Multiple license held by brokers for more than on brokerage  Group license held by associates working for unlicensed owner
    • Chapter Four Property Rights  Define real property  Know physical components of real estate  Know legal test for fixtures  Understand what the “bundle of rights” are  Understand Florida’s Homestead Laws  Know the difference between condos and coops
    • Chapter Four Review  Real property is the land with everything attached and the “bundle of rights”  Personal property may become a fixture:  Intent  Method of attachment  Agreement  Adaptation  Bundle of Rights include Disposition, Enjoyment, Exclusion, Possession, and Control Continued
    • Session Four Review  Own real estate in fee simple or life estate  Homestead: protected from judgment foreclosure  Tenancy by Entireties: husband-wife  Joint tenancy: equal Possession, Interest, Time, and Title  Condo/Coop rescission: 15 day new or 3 business day resale  Time Share rescission is 10
    • Chapter Five Real Property Ownership  Know methods of acquiring title to real estate  Distinguish between constructive and actual notice  Know the difference between abstract and chain of title  Know the different types of deeds and their components  Know the difference between government and private restrictions  Distinguish among the various types of leases
    • Chapter Five Review  Constructive Notice is recording on public record  Licensees should not give opinions of title  Chain of title (ownerships) is part of the abstract  Grantor (giver) must be competent  Habendum clause identifies the type of estate  Failing to record a deed may cause a person to be “estopped” (prevented) from ownership Continued
    • Chapter Five Review  Warrant of Seisen (declaring ownership) is not found in Quit Claim Deed  Police Powers include zoning  Government limitation includes Eminent Domain  Private limitation includes Deed Restriction  Assignment of lease: give up everything  Mechanic’s lien is effective when materials were delivered. Can foreclose homestead
    • Chapter Six Legal Description  Know the purpose of a legal description  Know the 3 types of legal descriptions  Understand sections, townships and ranges  Understand how to subdivide sections
    • Chapter Six Review  Metes and Bounds is the most accurate and has a Point of Beginning  Government Survey divides state into checkerboard  Meridian line runs north and south  Base line runs east and west  Ranges are 6-mile bans running north and south  Townships (Tiers) are 6-mile bans running east and west  A Township contains 36 sq miles and 36 sections  There are 640 acres in a section  Lot and Block is used in subdivisions
    • Chapter Seven Sales Associates and Brokerage Activities  Know the requirements of a broker’s office  Know the difference between branch office and temporary shelter  Understand advertising regulations  Understand how escrow money is handled  Know how rental lists are handled  Know how an associate changes employers
    • Chapter Seven Review  Every broker must have an office somewhere  Required information:  Broker/brokerage  Lic. Real Estate Broker  Assoc may be on sign with proper identification  Branch offices are not transferable and registration is good for 2 years Continued
    • Chapter Seven Review  Construction trailer is “temporary shelter”  Broker ultimately responsible for all advertising  Ad without brokerage is “blind ad”  Fed “No Solicitation” prohibits cold calling FSBOs  Immediate means 3-business days to deliver EMD to escrow account Continued
    • Chapter Seven Review  Settlement Procedures for Conflicting Demands: mediation, arbitration, litigation, and Escrow Disbursement order  10 day to notify FREC of resolution  Rental Information Lists: info correct 75% refund, info incorrect 100% refund when demand is made within 30 days  General Partnerships: 2 or more persons, 1 active broker, associates cannot be GPs  Corporations: 1 active broker, associates cannot be officers or directors but can be stockholders
    • Chapter Eight Agency Laws  Understand provisions in Florida’s Agency Laws  Know the differences between the 3 types of agency relationships  Know the disclosure procedures required by law  Understand how to transition from a single agency to a transaction broker  Know how agency relationships are terminated
    • Chapter Eight Review  Dual agency repealed  Single Agency:  Full fiduciary  Work with either buyer or seller  Disclose prior to showing or prior to contract whichever comes 1st  Transaction Broker:  Limited obligations  Work with both buyer and seller  No disclosure required (presumed to be transaction broker) Continued
    • Chapter Eight Review  No Brokerage (Non-Rep):  No skill, care, and diligence  Minimum obligations  Disclose prior to showing  Transition to Transaction Broker:  Must be signed by client
    • Chapter Nine The Real Estate Market  Know the physical characteristics of real estate  Understand how supply and demand affect price  Know the difference between Buyers market and Sellers market
    • Chapter Nine Review  Physical characteristics are:  Immobile  Heterogeneous  indestructible  Situs is the uniqueness of location combined with immobility  Sellers vs Buyers markets: who ever is in the minority Continued
    • Chapter Nine Review  Demand:  People wanting housing  Price goes up, demand goes down  Supply:  Product on the market  Material prices go up, prices of housing goes up
    • Chapter Ten Residential Product Knowledge  Understand the various building codes  Know the different types of lots  Know the different types of roofs  Know the different types of windows  Understand who needs a contractors license  Understand the various environmental hazards in real estate
    • Chapter Ten Review  Building Codes are local in nature  Contractor’s license are obtained through the DBPR  A Key Lot is one that is better than adjacent lots and generally more expensive  A gable roof has 2 sloping sides where a hip roof has 4 sloping sides  The strength of insulation is defines by it’s “R” value  Environment hazards include asbestos, radon gas, lead paint, and urea formaldehyde
    • Chapter Eleven Real Estate Appraisal  Know Federal & State regulations regarding appraising  Understand market value  Distinguish among cost, price, and value  Know the 3 approaches to value  Understand how to prepare a CMA
    • Chapter Eleven Review  Appraisals can only be done by individuals that are State Certified  Real estate licensees can prepare Comparative Market Analysis  Market value is what the normal buyer under normal conditions would pay for a property  Cost, Price, Value may or may not be the same  Use that causes the greats value is highest and best use Continued
    • Chapter Eleven Review  Comparable sales approach: Robin Hood  Cost depreciation approach: special purpose buildings  Income approach: income div by rate = value (anticipation)  Assemblage is combining and Plottage is the increase in value  Comparative Market Analysis:  Sold  Currently on market  Expired
    • Chapter Twelve Investment & Business Opportunity  Know the advantages and disadvantages in buying investment real estate  Understand risks as they relate to returns  Know the difference between real estate brokers and business brokers
    • Chapter Twelve Review  Advantages:  Good return  Tax advantages  Leverage  Equity build-up  Disadvantages:  Illiquidity  Management expense Continued
    • Chapter Twelve Review  Risk:  Business risk: income lower than expenses  Financial risk: no funds available  Business Brokers must understand financial data  Liquidation Value Approach is unique to business appraisals
    • Chapter Thirteen Real Estate Taxes  Distinguish among immune, exempt, and partial exempt properties  Know how property taxes a formulated  Know how to appeal tax bills  Know how to calculate special assessments  Know how to calculate taxable income  Distinguish between installment sales and like-kind exchanges
    • Chapter Thirteen Review  Ad Valorem taxes are real estate taxes calculated in millage  Government properties are immune  Churches & non-profit properties are exempt  Homestead is partially exempt  Greenbelt laws favor agricultural properties with lower assessed value  Non-payment of property taxes cause tax certificate sale  Bidding starts at 18% and bids down  After 2 years holder of certificate can request tax deed through foreclosure Continued
    • Chapter Thirteen Review  Taxable Income:  Net Income  +Reserves  -Interest  -Depreciation  = Taxable Income  Like-kind exchanges and installment sales defers taxes
    • Chapter Fourteen Real Estate Contracts  Know the essentials of a contract  Distinguish among the various types of contracts  Know how contracts can be terminated  Know the remedies to a breached contract  Understand what the Statute of Frauds is  Know what disclosures are required
    • Chapter Fourteen Review  The Statute of Frauds require certain contracts to be in writing to be enforceable  The Partial Performance Doctrine an oral real estate contract to be enforceable part of the purchase price is paid and the buyer is allowed to move in and/or begin renovations  Contracting persons should be 18 years of age and mentally competent Continued
    • Chapter Fourteen Review  Contracts with minors are voidable  Must have offer, acceptance, a communication back  Breach of contract can be remedied by:  Liquidated damages give the seller  Specific performance  Unliquidated damages Continued
    • Chapter Fourteen Review  Listing contracts:  Open listing  Exclusive listing  Exclusive right to sell (best)  Net listing (can’t gouge seller)  Sales and Purchase Agreement  Seller has legal title up to closing  Buyer has equitable title up to closing  Required disclosures:  Radon gas  Lead based paint for homes built prior to 1978  Option Contracts are unilateral
    • Chapter Fifteen Real Estate Finance  Distinguish between lien and title theory  Distinguish between notes and mortgages  Know the components of a note and mortgage  Understand the foreclosure process  Be able to calculate the loan to value ratio  Know how to calculate discount points  Distinguish between “assumption of” and “subject to”
    • Chapter Fifteen Review  Lien theory: property owner has title while bank has mortgage. Title theory bank has title to loan is paid  Mortgagor is borrower, mortgagee is bank  Note is an I.O.U. and not recorded  Mortgage is security instrument and is recorded  LTV is the loan amount as it relates to the value expressed as a percentage Continued
    • Chapter Fifteen Review  Discount points are pre-paid interest. Increases lenders yield 1/8% for each point charged  “Assumption of” a mortgage buyer signs new note  “Subject to” a mortgage buyer does not sign new note  First step in a foreclosure is filing a Lis Pendens  Equity of Redemption is the right the owner has to pay off the loan and prevent the foreclosure
    • Chapter Sixteen Sources of Mortgage Money  Know the components of the Adjustable Rate Mortgage  Understand the amortization process  Distinguish among the different types of mortgages  Understand the underwriting process  Understand the secondary mortgage market  Know Federal laws that regulates the financial market
    • Chapter Sixteen Review  Amortization is payments of principal and interest. More interest than principal but changes each payment  Adjustable Rate Mortgage consists of an index (which changes) and margin (fixed)  Blanket mortgage covers more than on parcel of real estate and needs release provisions to sell individual lots  FHA is an insurance with underwriting guidelines of 31%mortgage payment and 43% total bills  VA is a guarantee based on loan amount Continued
    • Chapter Sixteen Review  Convention mortgages require private mortgage insurance on the portion of the loan greater than 80%  Banks are considered intermediaries because of savings and checking accounts  Open market operations is the most effective method the FEDs have to influence interest rates  FNMA was created to purchase the FHA mortgage Continued
    • Chapter Sixteen Review  Real Estate Settlement Procedures Act  Information booklet within 3 days of app  Good-faith estimate of closing cost within 3 days of app  HUD-1 Settlement Statement no later than closing. Borrower has the right to at lease one day prior to closing to review statement  Applies to federally related residential loans only
    • Chapter Seventeen Real Estate Closings  Know how to calculate sales commissions  Know how to calculate:  Doc stamps on deed  Doc stamps on note(s)  Intangible tax on new mortgages  Understand how to prorate items  Understand who pay closing costs and how that is determined
    • Chapter Seventeen Review  Debits: money owed  Credits: money received  Prorations are items shared  Expenses are monies owed outside closing  Doc stamp on deed: $0.70/per $100  Doc stamp on note: $0.35/per $100  Intangible tax: $0.002 x new mortgage  Mortgages are always debits to sellers and credits to buyers
    • Chapter Eighteen Planning and Zoning  Understand the authority of the Planning Commission  Understand Florida’s Comprehensive Plan and Growth Management Act  Know how Concurrency Rules affect future developments  Distinguish among the various zoning ordinances  Distinguish between a variance and special exception  Know the important features of a Planned Unit Development
    • Chapter Eighteen Review  The planning commission is appointed by government leaders and made up of ordinary citizens. They have a professional staff  Concurrency rules require the infrastructure to be part of the development plan  Residential zoning: density  Commercial zoning: intensity  Variance: relief in zoning  Special exception: new zoning for specific use  PUDs incorporate commercial, residential and other mixed uses
    • Chapter Nineteen State & Fed Real Estate Laws  Understand the 1968 Fair Housing Act  Know the significance of Jones vs. Mayer  Understand HUD’s role in the Fair Housing Act  Understand the Landlord/Tenant Act  Know the provisions of Florida’s Uniform Land Sales Practice Act
    • Chapter Nineteen Review  1968 Fair Housing Act prohibits discrimination based on race, color, religion, sex, national origin, familial status, or handicap status  Jones vs Mayer confirmed validity of 1866 Civil Rights Law  Steering: directing persons to or from  Blockbusting: inducing persons to sell Continued
    • Chapter Nineteen Review  Landlord/Tenant Act allows landlords to co- mingle deposits into person accounts:  Pay tenant 5% for use  Place surity bond in the amount of deposit with clerk of courts  Florida Uniform Land Sales Practice Act requires subdividers sell 50 lots or more to provide buyer with public offering statement giving 7 days to rescind
    • Chapter Twenty Violations, Penalties, & procedures  Know how a complaint is filed  Understand the disciplinary process  Know what penalties can be imposed by FREC  Know what penalties can be imposed by state attorney  Understand how the recovery fund operates  Distinguish a 1st degree from a 2nd degree misdemeanor
    • Chapter Twenty Review  The complaint must be legally sufficient  The investigation is a gathering of facts  Chairperson of FREC appoints 2 members for probable cause panel  Formal Complaint is outline of legal charges with 20 days to respond Continued
    • Chapter Twenty Review  A hearing can be formal or informal  Recommended Order by ALJ with 10 days to challenge  Final Order handed down by FREC with 30 days to appeal to DCA  Notice of Non-compliance is minor infraction with 15 days to correct Continued
    • Chapter Twenty Review  FREC can:  Suspend up to 10 yrs; fine up to $5,000; revoke license  State Attorney can:  Fine and/or incarcerate (violations are criminal)  1st degree misdemeanor up to $1,000 fine and/or 1 year in jail  2nd degree misdemeanor up to $500 fine and/or 60 days in jail  Recovery Fund:  $50,000 single judgment  $150,000 for multiple judgments
    • Chapter Twenty-One Math  Common areas: acres in subdivision, number of offices in a building  Cost-depreciation in appraising  Income approach: Uncle IRV  Gross rent multiplier: VRM  Percentage of profit: Made over Paid Continued
    • Chapter Twenty One Review  Loan amortization  Calculate commission  Pro-ration: taxes and rent  Closing calculations: doc deed, doc note, intangible  Underwriting: Housing expense ratio  Cost per acre and cost per front foot  Legal description: calculate sub-sections