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Section 5 Real Estate Brokerage Activities and Procedures, Azure Tide Realty Test Bank
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Section 5 Real Estate Brokerage Activities and Procedures, Azure Tide Realty Test Bank
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Section 5 Real EstateBrokerage Activities and
Procedures, Azure Tide
Realty Test Bank
Arbitration - Answer: Another one of the four settlement procedures is to submit the dispute for
arbitration. An arbitrator is an unbiased third person designated by the parties who agree in advance to
comply with the decision—a decision to be issued after a hearing at which both parties have an
opportunity to be heard.
blind advertisement - Answer: If advertising is not clear that a real estate brokerage is involved, and the
real estate broker is not clearly identified, the advertising is called blind advertising.
commingle - Answer: Mixing trust funds from another with the agent's personal or business funds
conflicting demands - Answer: Both buyer and seller claim the right to earnest monies.
Conversion - Answer: is the appropriation of property belonging to another. It is illegal for a broker to
convert trust funds to his own use -even if it is just temporary.
Corporation - Answer: not an actual person, yet corporations are treated as such by having legal rights
and taking on the tax and legal liabilities of the company.
corporation sole - Answer: Usually a religious organization, CANNOT register as real estate brokerage.
Deposit - Answer: A deposit is adown payment and part of the purchase price paid in cash up front,
reducing the amount of the purchase price, loan or mortgage.
, earnest money - Answer: also called a binder deposit, escrow, or a good-faith deposit is a sum of money
given to bind the sale of real estate, or a sum of money given to ensure payment or an advance of funds
in the processing of a loan.
escrow account - Answer: In real estate, the earnest money cannot be placed into a broker's general
operating account. Instead, it must be placed in special account for the purpose of "escrowing" or
placing the money in "trust."
escrow disbursement order(edo) - Answer: determination by FRECas to who is entitled to disputed
funds.
general partnership - Answer: When more than one person joins together to operate a business, they
share in the profits and responsibilities including the legal and tax liabilities. Each general partner is
liable for all the debts of the partnership.
good-faith doubt - Answer: Good-faith doubt procedure when it is not clear which party should receive
the escrowed property.
interpleader - Answer: Florida law provides for a broker who has chosen NOT to have a right to any of
the deposit to submit the matter to the courts and request an interpleader. By using an interpleader, the
broker deposits the funds with the clerk of the court and is relieved of further duties in overseeing the
matter.
Kickback - Answer: payment for doing a task related to a real estate transaction. However, the task itself
cannot be something that actually requires a real estate license to perform. "Kickbacks" are legal only
under limited conditions.
limited liability company (LLC) - Answer: has both the characteristics of a corporation and a partnership.
It's like a corporation in that it protects the owners against personal liability. It's like a non-corporate
business in the way profit or loss is passed straight to the owners for tax purposes rather than taxed at
the company level.
limited liability partnership (LLP) - Answer: To avoid personal liability that a general or limited
partnership creates for general partners, a limited liability partnership may be formed. The Limited
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