1. A non-homestead property has a taxable value of $180,000. The total millage rate is 17.5 mills. What is the annual tax?
Answer & explanation
Answer: D. 17.5 mills = 0.0175. $180,000 x 0.0175 = $3,150. Or ($180,000 / $1,000) x $17.50 = 180 x $17.50 = $3,150. $31,500 results from misplacing the decimal (0.175).
2. Grace holds a life estate measured by the life of her uncle Victor. Grace dies before Victor. What happens?
Answer & explanation
Answer: D. In a life estate pur autre vie, the measuring life is Victor's, so Grace's interest passes to her heirs until Victor dies. The remainder or reversion takes effect only at Victor's death.
3. A life tenant who demolishes a sound building on the property, reducing its value to the remainderman, has committed
Answer & explanation
Answer: A. Waste is permanent damage by a life tenant that injures the future interest holder. Escheat is the reversion of property to the state when an owner dies without heirs or will.
4. What is the maximum the Real Estate Recovery Fund will pay for all claims arising out of a single transaction?
Answer & explanation
Answer: B. Claims from the same transaction are limited, in the aggregate, to $50,000 regardless of the number of claimants. $150,000 is the aggregate cap per licensee, not per transaction.
5. Under Florida's Marketable Record Title Act, how long must the root of title have been of record?
Answer & explanation
Answer: C. Section 712.02 provides marketable record title to a person vested with an estate of record for 30 years or more. Seven years is the adverse possession period, a frequent distractor.
6. How many members serve on the Florida Real Estate Commission?
Answer & explanation
Answer: C. Section 475.02 establishes a seven-member commission appointed by the Governor and confirmed by the Senate.
7. Which sequence correctly lists the four phases of a real estate market cycle?
Answer & explanation
Answer: C. The cycle runs recovery, expansion, hypersupply (oversupply), and recession, then returns to recovery.
8. A rental property has NOI of $48,000 and annual debt service of $36,000. The investor's cash investment was $120,000. What is the cash-on-cash return?
Answer & explanation
Answer: D. Before-tax cash flow = $48,000 - $36,000 = $12,000. Cash-on-cash = $12,000 / $120,000 = 10%. 40% divides NOI by the cash invested without subtracting debt service; 30% divides debt service by the investment.
9. For how long may FREC suspend a real estate license?
Answer & explanation
Answer: D. FREC may suspend a license for a period not exceeding 10 years under s. 475.25(1). Five years is the general time limit for filing an administrative complaint, which is a common source of confusion.
10. Under s. 725.01, F.S., a lease of real property must be in writing to be enforceable when its term is
Answer & explanation
Answer: D. The statute of frauds covers leases for a period longer than one year. A lease of exactly one year or less may be oral. Choosing 'one year or longer' is the common trap.
11. A Florida foreclosure judgment, including costs, totals $318,500. The property sells at the clerk's auction for $276,000. What is the maximum deficiency the lender could seek?
Answer & explanation
Answer: C. Deficiency = amount owed minus sale proceeds: $318,500 - $276,000 = $42,500. The court has discretion and may consider fair market value, and the action must be brought within one year under s. 95.11.
12. Which form of ownership requires the unity of marriage in addition to possession, interest, time, and title?
Answer & explanation
Answer: C. Tenancy by the entirety requires the four unities plus marriage. Joint tenancy requires only the four PITT unities.
13. Which law prohibits all racial discrimination in property transactions with no exemptions?
Answer & explanation
Answer: B. The 1866 Act, as applied in Jones v. Alfred H. Mayer Co. (1968), bars all private and public racial discrimination and contains no exemptions. The 1968 Fair Housing Act has exemptions, which makes it the tempting wrong answer.
14. An honorably discharged veteran with a service-connected total and permanent disability owns a Florida homestead. He is entitled to
Answer & explanation
Answer: B. Section 196.081 exempts the homestead of a veteran with a service-connected total and permanent disability from taxation entirely. The $5,000 exemption (s. 196.24) is for veterans with a service-connected disability of 10% or more that is not total and permanent.
15. A married couple filing jointly bought their home for $410,000 and spent $65,000 on capital improvements. They sell for $1,050,000 with $63,000 in selling costs. Both meet the ownership and use tests. What is their taxable gain?
Answer & explanation
Answer: D. Adjusted basis = $410,000 + $65,000 = $475,000. Amount realized = $1,050,000 - $63,000 = $987,000. Gain = $987,000 - $475,000 = $512,000. Exclusion = $500,000. Taxable = $12,000. $75,000 ignores the selling costs; $0 assumes the gain is under the exclusion.
16. A tax certificate holder may apply for a tax deed after
Answer & explanation
Answer: C. Section 197.502(1) allows a tax deed application any time after 2 years have elapsed since April 1 of the year of issuance. Seven years is when an unapplied-for certificate expires under s. 197.482.
17. If a security deposit is held in an interest-bearing account, the tenant is entitled to
Answer & explanation
Answer: A. Section 83.49(1)(b) gives the landlord the option of paying at least 75% of the annualized average rate or 5% simple interest.
18. An abstract of title combined with an attorney's opinion of title differs from title insurance because
Answer & explanation
Answer: D. An abstract is merely a summary of recorded documents, and the attorney's opinion is an opinion; if it is negligent, the buyer's remedy is against the attorney. Neither protects against hidden unrecorded defects the way title insurance can.
19. To receive a homestead exemption for the current tax year, a Florida owner must generally file the application with the property appraiser by
Answer & explanation
Answer: A. Section 196.011 requires the application by March 1. January 1 is the date ownership and permanent residence must exist; March 31 is the last day to pay the prior year's taxes; April 1 is the delinquency date.
20. Which activity is exempt from Florida real estate licensure?
Answer & explanation
Answer: A. Section 475.011 exempts persons renting or advertising transient occupancy of Chapter 509 public lodging establishments. The other activities are brokerage.
21. A Florida homeowner pays a $6,250 property tax bill in November. What amount is due?
Answer & explanation
Answer: C. November payments receive the maximum 4% discount: $6,250 x 0.96 = $6,000. $6,062.50 reflects December's 3%; $6,187.50 reflects February's 1%.
22. Which of the following is NOT required for a deed to be valid in Florida, though it is needed for recording?
Answer & explanation
Answer: D. An acknowledgment is required to record the deed but not for validity between the parties. A competent grantor, a legal description, and a granting clause are essential elements.
23. The Notice of Proposed Property Taxes (TRIM notice) is mailed to Florida property owners in
Answer & explanation
Answer: D. The property appraiser mails the TRIM notice in August. It shows values, exemptions and proposed millage and is not a bill. Tax bills go out around November 1.
24. When a title company holds the deposit, the licensee's broker must request written verification of receipt within
Answer & explanation
Answer: A. Rule 61J2-14.008 requires the written request within 10 business days after each deposit is due, unless the seller or seller's agent nominated the escrow agent in writing.
25. Florida's property tax disclosure summary warns residential buyers that
Answer & explanation
Answer: C. Section 689.261 requires the seller to provide the summary at or before contract execution; reassessment after a change in ownership can raise taxes.
Sources
Source verification pending. Confirm current requirements with your state regulator.