FRC Real Estate Broker Examination key terms

A Florida real estate business entity or sole proprietorship that operates under a licensed broker and through which associates perform real estate services for compensation.

The licensed broker who holds the brokerage registration, is accountable for its real estate activities, and supervises all associated licensees on behalf of the business entity.

A person holding a broker license who chooses to work under another broker instead of operating independently, registering with that broker and supervised like a sales associate.

A licensee who may perform real estate services only while employed by and supervised by a registered broker, and who may not accept compensation directly from clients.

A business location the broker has reported to the state licensing authority as a place where real estate business is transacted and records are kept or made available.

An additional business location of a brokerage that must be registered with the state and placed under the direction of a licensed broker or designated manager.

Requirements that all real estate advertising identify the brokerage name, avoid misleading claims, and remain under the broker's supervision regardless of the medium or platform used.

Promotional material for a licensed team that must include the brokerage name, with the team name registered and used in a way that does not imply a separate brokerage.

The licensee designated by the broker to oversee daily operations, records, and associate conduct at a registered office, exercising supervisory authority delegated by the broker.

The broker's duty to establish written policies, monitor associate conduct, review transactions, and correct violations, with responsibility extending to activities the broker knew or should have known about.

A bank account, maintained by the broker or an authorized title agent, in which funds belonging to others are held in trust pending disbursement under a transaction agreement.

Money or property received by a licensee on behalf of another, such as deposits, rents, or advance fees, which must be handled under strict accounting and disbursement rules.

The improper practice of mixing trust funds with the licensee's personal or business operating money in the same account, which is prohibited even where no shortage exists.

The unauthorized use or misappropriation of funds or property held in trust for another, treated as a serious license violation and potentially a criminal offense.

A periodic comparison of the escrow account bank balance to the sum of individual ledger balances and outstanding items, documented monthly and retained for inspection.

Money a buyer delivers to show good-faith intent to complete a purchase, held in escrow and applied to the price or disbursed per the contract's terms.

The heightened legal obligation of trust owed by a licensee to a principal, requiring loyalty, obedience, disclosure, confidentiality, reasonable care, accounting, and full dealing.

A brokerage relationship in which the licensee represents only one party as a fiduciary and owes that party the full set of fiduciary duties during the transaction.

A limited representation relationship, presumed in most Florida residential transactions, in which the licensee assists both parties without full fiduciary duties but owes honesty, disclosure, and accounting.

A disclosed arrangement in which a licensee provides limited services to a customer without representing either party as an agent and without fiduciary obligations.

The duty to keep a principal's nonpublic information private, surviving the transaction's end, and not to disclose it to the other party without informed consent.

The written notice required at the outset of a relationship explaining the type of representation offered, the duties owed, and the right to choose a different relationship.

A legally enforceable promise or set of promises supported by offer, acceptance, consideration, and lawful purpose, which may be written, oral, or implied by conduct.

The rule requiring certain agreements, including real estate sales contracts and leases longer than one year, to be in writing and signed to be enforceable.

A court remedy compelling a breaching party to carry out the contract as agreed, commonly available in real estate because each property is considered unique.

A contract clause setting a predetermined sum, often the deposit, payable on default instead of proving actual loss, enforceable when the amount is a reasonable forecast.

The date a contract becomes binding, typically when the final offer or acceptance is delivered, from which deadlines such as inspection and financing periods are measured.

A contract condition whose failure or non-satisfaction allows a party to cancel or renegotiate, such as financing, inspection, appraisal, or sale of a prior home.

The written contract stating price, deposit, closing date, contingencies, and remedies for a real property transfer, usually on a state-approved form with riders.

A written instrument that transfers an interest in real property from a grantor to a grantee when properly executed, delivered, and accepted.

The public filing of documents such as deeds and mortgages with the county clerk, giving constructive notice of the interest to later purchasers and lenders.

The chronological record of successive owners and encumbrances affecting a parcel, examined to confirm that the seller holds transferable title.

Title reasonably free of defects, liens, and encumbrances that a prudent buyer would accept, and the standard a seller typically must convey under a sales contract.

A policy protecting an owner or lender against losses from title defects, liens, or claims existing before the policy date and not excepted from coverage.

A written lien on real property given to secure repayment of a debt, allowing the lender to foreclose on the property if the borrower defaults.

The borrower's written promise to repay a loan, stating principal, interest rate, payment schedule, and default terms, separate from the mortgage lien instrument.

The loan amount divided by the property's appraised value or price, used to assess risk and determine whether mortgage insurance or a larger down payment is required.

The gradual repayment of a loan through scheduled payments that cover interest and reduce principal, with the principal portion increasing over the loan term.

Coverage a lender requires on higher loan-to-value conventional loans, protecting the lender against borrower default while the borrower pays the premium.

The legal process by which a lender enforces a mortgage lien, selling the property to satisfy a defaulted debt, often through a court-supervised sale.

A sale of property for less than the debt owed, completed with lender approval so that the net proceeds release the mortgage lien.

A licensee's analysis of recent comparable sales, listings, and market conditions to suggest a probable sale price, distinct from a licensed appraisal.

An opinion of value developed by a state-certified or licensed appraiser using recognized methods, required in federally related lending transactions above set thresholds.

The reasonably probable, legally permissible, financially feasible use of a property that produces the greatest value, a foundation of appraisal analysis.

A written agreement granting a tenant the right to occupy a dwelling for a stated term and rent, defining rights and duties of landlord and tenant.

Money a tenant gives to secure performance of a lease, which a landlord must hold and return with an itemized accounting of deductions within statutory deadlines.

The legal proceeding a landlord uses to remove a tenant for nonpayment, lease violation, or holdover, which may not be accomplished by self-help.

Federal and state laws prohibiting discrimination in the sale, rental, or financing of housing based on protected characteristics such as race, color, religion, sex, disability, and familial status.

Directing or limiting a buyer or renter toward or away from particular neighborhoods based on protected characteristics, an illegal practice even without an explicit refusal.

Refusing or varying the terms of loans, insurance, or services for properties in certain areas based on the protected characteristics of their residents.

A change in rules, policies, or procedures needed so a person with a disability can use and enjoy housing, which a landlord generally must grant absent undue burden.

A structural change to a dwelling or common area, at the tenant's expense where required, that allows a person with a disability full use of the housing.