FL Real Estate flashcards

32 cards. Read the term and the definition here. The deck at the top of this page is optional.

Real estate brokerage

The business of bringing buyers and sellers together and negotiating real estate transactions for another person in exchange for compensation; a Florida license is required.

CMA versus appraisal

A comparative market analysis estimates value using recent sales and is prepared by a licensee; an appraisal is a supported value opinion prepared by a state-certified or licensed appraiser.

Real estate illiquidity

Real estate cannot be quickly converted to cash without significant time and price concessions because each property is unique, immobile, and expensive to transfer.

Florida sales associate prelicense

A candidate must complete 63 classroom hours, pass the state exam, be at least 18, and register under an employing broker before performing brokerage.

Post-license education

A newly licensed Florida sales associate must complete a 45-hour post-license course before the first license renewal; failure can cause the license to become void.

Continuing education requirement

After the initial cycle, Florida licensees complete 14 hours of approved continuing education every two years, including required core topics, to renew an active or inactive license.

Unlicensed compensation

A Florida licensee may not pay a commission or other brokerage compensation to an unlicensed person for activities that require a real estate license.

Transaction broker

A Florida brokerage relationship that provides limited representation to a buyer, seller, or both, without fiduciary loyalty; the broker must deal honestly and disclose known material facts.

Single agent

A brokerage relationship in which one licensee represents only the buyer or only the seller and owes that principal full fiduciary duties, including loyalty and confidentiality.

Fiduciary duties

The duties an agent owes a principal: loyalty, obedience, disclosure, confidentiality, accounting for funds, and reasonable care and diligence in performing the agency.

Dual agency in Florida

Florida does not recognize dual agency in real estate brokerage; instead, a brokerage may act as a transaction broker for both parties with limited representation and required disclosures.

Statute of Frauds

A legal rule requiring certain contracts, including a sale of land or a lease longer than one year, to be written and signed by the party to be charged.

Earnest money deposit

Money a buyer gives to show good faith and bind a sale contract; it is credited to the buyer at closing or may be forfeited under the contract's default terms.

Option contract

A unilateral agreement in which a buyer pays consideration for the right, but not the obligation, to purchase property within a stated period on specified terms.

Fee simple absolute

The most complete ownership estate; it lasts indefinitely, is inheritable, and gives the owner all rights subject only to government powers and private restrictions.

Tenancy by the entirety

A form of joint ownership available only to married couples in Florida; each spouse owns the whole, with right of survivorship and protection from one spouse's creditors.

Life estate

An ownership estate lasting for the lifetime of a named person; the life tenant may use the property but must not commit waste, and the future interest passes to a remainderman or reversioner.

General warranty deed

A deed in which the grantor warrants title against defects arising before and during the grantor's ownership, including seisin, quiet enjoyment, and encumbrances.

Quitclaim deed

A deed that transfers whatever interest the grantor may have in the property without any warranty of title; it does not guarantee marketable title.

Constructive notice

Legal notice created by recording a deed or other instrument in the public records, which is deemed to inform all persons of its contents.

Government survey section

A one-square-mile unit in the rectangular survey system containing 640 acres; 36 sections form a six-mile-by-six-mile township.

Metes and bounds

A legal description that identifies a parcel by starting at a point of beginning and following courses, distances, and monuments around the boundary back to the start.

Acre conversion

One acre equals 43,560 square feet; one square mile equals 640 acres, and a quarter-quarter section contains 40 acres.

Loan-to-value ratio

The loan amount divided by the lesser of the purchase price or appraised value, expressed as a percentage; it measures lender risk and affects mortgage insurance.

Discount points

Fees paid at closing to reduce the mortgage interest rate; one point equals one percent of the loan amount and increases the lender's yield.

PITI payment

A monthly housing payment including principal, interest, property taxes, and hazard insurance; it is commonly used to qualify borrowers for mortgage loans.

Highest and best use

The use that is legally permissible, physically possible, financially feasible, and maximally productive, producing the highest value for the property.

Income approach

A valuation method that estimates value by dividing net operating income by a capitalization rate, or by applying a gross rent multiplier to gross rent.

External obsolescence

A loss in value caused by factors outside the property, such as neighborhood decline, traffic patterns, or market conditions, that the owner cannot easily correct.

Proration formula

To prorate an annual expense, divide the annual amount by 365 and multiply by the number of days allocated to the buyer or seller.

Florida deed documentary tax

Florida documentary stamp tax on a deed is generally 70 cents per $100 of consideration, rounded up to the next $100, with different rates in Miami-Dade County.

Mortgage intangible tax

Florida imposes an intangible tax on a new mortgage at two mills, or $2 per $1,000 of the mortgage amount, in addition to documentary stamp tax.