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Real Estate License Law and Commission Rules- Unit 3
- Describe the composition,appointment and member qualifications of the Florida Real Estate Commission
- Define the powers and duties of the Commission
- Describe the scope and function of the DBPR and the DRE
- Explain the different licensure statuses
- Distinguish between active and inactive license status
- Describe the regulations regarding involuntarily inactive status
- Distinguish between multiple and group licenses
- cease to be in force
- current mailing address
- current status
- group license
- involuntarily inactive
- license authority voided
- multiple licenses
- null and void
- voluntarily inactive
Regulation by Department of Business and Professional Regulation (DBPR)
DBPR Organizational structure
The DBPR is housed under the People of Florida, the Governor, and the Deputy Secretary. As this hierarchy reflects the overall structure of our local government. It is important to note that the Florida Real Estate Commission (FREC) is nestled within the Division of Real Estate.
Terms to understand within Chapter 455.01 F.S.
When interacting with our local government, it is beneficial to know the meaning of terms as defined by the Florida Statutes (Florida Law). The following terms should be understood as defined while reading, studying and practicing real estate within Florida.
Board means any board or commission, or other statutorily created entity to the extent such entity is authorized to exercise regulatory or rulemaking functions, within the department, including the Florida Real Estate Commission; except that, for ss. 455.201–455.245, “board” means only a board, or other statutorily created entity to the extent such entity is authorized to exercise regulatory or rulemaking functions, within the Division of Certified Public Accounting, the Division of Professions, or the Division of Real Estate. (Source)
Consumer member means a person appointed to serve on a specific board or who has served on a specific board, who is not, and never has been, a member or practitioner of the profession, or of any closely related profession, regulated by such board.
Department means the Department of Business and Professional Regulation.
License means any permit, registration, certificate, or license issued by the department.
Licensee means any person issued a permit, registration, certificate, or license by the department.
Profession means any activity, occupation, profession, or vocation regulated by the department in the Divisions of Certified Public Accounting, Professions, Real Estate, and Regulation. (Source)
DBPR Regulation Legislative Intent:
It is the intent of the Legislature that persons desiring to engage in any lawful profession regulated by the department shall be entitled to do so as a matter of right if they are qualified. The DBPR has made it very easy to access and engage. Remember, you can access the DBPR via mail, online, or phone, or fax. The contact page is readily available for all.
The Legislature further believes that such professions shall be regulated only for the preservation of the health, safety, and welfare of the public under the police powers of the state.
Professions shall be regulated when:
- Their unregulated practice can harm or endanger the health, safety, and welfare of the public, and when the potential for such harm is recognizable and clearly outweighs any anticompetitive impact which may result from regulation.
- The public is not effectively protected by other means, including, but not limited to, other state statutes, local ordinances, or federal legislation.
- Less restrictive means of regulation are not available.
It is further legislative intent that the use of the term “profession” with respect to those activities licensed and regulated by the department shall not be deemed to mean that such activities are not occupations for other purposes in state or federal law.
- Neither the department nor any board may create unreasonably restrictive and extraordinary standards that deter qualified persons from entering the various professions. Neither the department nor any board may take any action that tends to create or maintain an economic condition that unreasonably restricts competition, except as specifically provided by law.
- Neither the department nor any board may create a regulation that has an unreasonable effect on job creation or job retention in the state or that places unreasonable restrictions on the ability of individuals who seek to practice or who are practicing a given profession or occupation to find employment.
- The Legislature shall evaluate proposals to increase regulation of already regulated professions or occupations to determine their effect on job creation or retention and employment opportunities.
- Policies adopted by the department shall ensure that all expenditures are made in the most cost-effective manner to maximize competition, minimize licensure costs, and maximize public access to meetings conducted for the purpose of professional regulation. The long-range planning function of the department shall be implemented to facilitate effective operations and to eliminate inefficiencies.
Department (DBPR) powers and duties; F.S. 455.203
The department, for the boards under its jurisdiction, shall:
- Adopt rules establishing a procedure for the biennial renewal of licenses; however, the department may issue up to a 4-year license to selected licensees notwithstanding any other provisions of law to the contrary. Fees for such renewal shall not exceed the fee caps for individual professions on an annualized basis as authorized by law.
- Appoint the executive director of each board, subject to the approval of the board.
- Submit an annual budget to the Legislature at a time and in the manner provided by law.
- Develop a training program for persons newly appointed to membership on any board. The program shall familiarize such persons with the substantive and procedural laws and rules and fiscal information relating to the regulation of the appropriate profession and with the structure of the department.
- Adopt rules pursuant to ss. 120.536(1) and 120.54 to implement the provisions of this chapter.
- Establish procedures by which the department shall use the expert or technical advice of the appropriate board for the purposes of investigation, inspection, evaluation of applications, other duties of the department, or any other areas the department may deem appropriate.
- Require all proceedings of any board or panel thereof and all formal or informal proceedings conducted by the department, an administrative law judge, or a hearing officer with respect to licensing or discipline to be electronically recorded in a manner sufficient to assure the accurate transcription of all matters so recorded.
- Select only those investigators, or consultants who undertake investigations, who meet criteria established with the advice of the respective boards.
- Work cooperatively with the Department of Revenue to implement an automated method for periodically disclosing information relating to current licensees to the Department of Revenue. The purpose of this subsection is to promote the public policy of this state as established in s. 409.2551. The department shall, when directed by the court or the Department of Revenue pursuant to s. 409.2598, suspend or deny the license of any licensee found not to be in compliance with a support order, subpoena, order to show cause, or written agreement entered into by the licensee with the Department of Revenue. The department shall issue or reinstate the license without additional charge to the licensee when notified by the court or the Department of Revenue that the licensee has complied with the terms of the support order. The department shall not be held liable for any license denial or suspension resulting from the discharge of its duties under this subsection.
Department (DBPR) Authority:
- Close and terminate deficient license application files 2 years after the board or the department notifies the applicant of the deficiency; and
- Approve applications for professional licenses that meet all statutory and rule requirements for licensure.
The Division of Professions within the Department of Business and Professional Regulation is responsible for the development, preparation, administration, scoring, score reporting, and evaluation of all professional examinations. The division shall seek the advice of the appropriate board in providing such services.
The Division is contracted with Pearson Vue to execute Real Estate Exam services. After you complete all requirements for license you can schedule your exam with Pearson Vue. Pearson Vue follows the department rules regarding monitoring and security while administering exams.
You may choose to take a secure online exam or go to a local Pearson Vue location. Either way, you may choose your exam in English or Spanish. If you request to have your exam in other languages, you must contact the DBPR within 6 months prior to your exam date.
On exam day you will not be able to remove or carry any items into your exam. Be prepared to empty all pockets and store items in a locker outside of the exam room. For this reason, it is advised to arrive at your exam with minimal items.
Division of Real Estate
The Division of Real Estate (DRE), housed within the Department of Business and Professional Regulation and under the Secretary of Professional Regulations.
The Division of Real Estate protects the public by regulation of real estate and appraisal licensees pursuant to Chapter 475, Florida Statutes. The Division is responsible for the examination, licensing and regulation of over a quarter of a million individuals, corporations, real estate schools and instructors. These responsibilities require oversight and ministerial duties including recordkeeping. The DRE relies on the Florida Real Estate Commission to enforce Florida Real Estate Laws throughout the Industry.
The mission of the DRE is to protect the public by regulation of real estate and appraisal licenses through education and compliance. The DRE relies on the Florida Real Estate Commission to regulate the Florida Real Estate Industry License Laws.
The Chief Financial Officer invests $3 million from the portion of the Professional Regulation Trust Fund credited to the real estate profession, under the same limitations as applied to investments of other state funds, and the income earned thereon shall be available to the foundation to fund the activities and projects authorized under this section. However, any balance of such interest in excess of $1 million shall revert to the portion of the Professional Regulation Trust Fund credited to the real estate profession. In the event the foundation is abolished, the funds in the trust fund shall revert to such portion of the Professional Regulation Trust Fund 475.045
The Florida Real Estate Commission
Rules Governing Internal Organization and operation
61J2-20 Recall, the purpose of regulations is to ensure public safety through licensing, and regulating more than one million businesses and professionals in the State of Florida. The Florida Real Estate Commission does that for the Real Estate Industry. For Florida Real Estate Education content, Real Estate Schools credentialing, and RealEstate Licensees (Broker, Broker Associates, & Sales Associates) FREC regulates it.
The FREC General Structure
The Florida Real Estate Commission (FREC) comprises seven members. Five are professional licensed Members where:
- Four Active Brokers who have been licensed for at least five years.
- One member must be a licensed broker, or a licensed sales associate who has held an active license for two years preceding appointment.
- Two members must be persons who are not, and have never been, brokers or sales associates – Consumer Members.
- Of the seven, at least one member of the Commission must be 60 years of age or older.
Terms and Compensation
Members of the Commission are appointed by the governor of Florida and serve four-year terms. Although there is no maximum total number of years a member can serve, Commission Members may not serve more than two consecutive terms.
Therefore a member who has served two consecutive terms would not be allowed a third term after a second term. However they may return after sitting out a term.
Compensation is set at $50 per day for each official meeting or other Commission based business. Reimbursement for travel, and other expenses related to Commission business may be reimbursed.
The FREC meets once a month at its headquarters in Orlando, Florida. During the Annual meeting an Chairperson and Vice Chairperson is elected.
Duties and powers of the Commission
The FREC is responsible for setting forth rules and regulations under the Division of Real Estate. The State Attorney Department of Legal Affairs support FREC as they execute their responsibilities. The FREC has responsibilities are as follows:
- Executive Powers include the power to regulate and enforce license law
- Set Education requirements of the applicants and licensees (pre, post, & continuing education) (F.S. 475.04)
- Adopt a Seal to authenticate documents (F.S. 475.10)
- Set licensing fees to support regulating the real estate license industry
- Quasi-Legislative − Power to enact or revise rules and regulations for the Florida Real Estate Industry. Within this role the FREC is supported as a legal branch of the government to serve its duties. However the FREC is not a legal branch of government. Therefore the term quasi is used to describe the FREC as acting as a legal branch. With support from the State attorney’s office the FREC using its quasi-legislative responsibilities promulgates rules.
- Making rules and bylaws.
- Regulate Professional Practices that include record keeping regarding monies used in real estate transactions. In the event of an escrow dispute the FREC may issue an escrow disbursement order to reach resolution about who should receive disputed escrow funds. Under the quasi legislative Powers, the FREC creates rules regarding monies, deposits, and escrow accounts for real estate transactions.
- Quasi-Judicial− Hears complaints, determines violations, and administers penalties to licensees. With quasi-judicial responsibilities, the FREC has the power to grant, or deny license applications.
- Grant or deny applications for licensure.
- Suspend or revoke a license
- Make determinations of violations
The FREC is a very important regulatory body within DBPR under the DRE. Additional duties include the following:
- Adopting a seal (F.S. 475.10)
- Foster Real Estate Education (F.S. 475.04)
- Power to enact rules and regulations, and decide questions of practice (F.S. 475.05) 5.
- Power to inspect and audit (F.S. 475.5016)
- Power to discipline licensees (F.S. 475.25)
- Must report criminal violations of Chapter 475 to state attorney
- Must inform the Division of Florida Land Sales, Condominiums, and Mobile
Homes when disciplinary action is taken by FREC against any of its licensees.
License Status and License Renewals
An active license status is always required to practice real estate services for compensation. Sales Associates become active after completing all necessary requirements to register with the DBPR. This includes becoming employed with an active broker.
Once Sales Associates decide which Florida Broker they want to work for, the employing broker can go to www.myfloridalicense.com click on “renew maintain license” and activate the broker sales associate through the sole proprietor account, or the entity/corporate account, whichever applies, OR submit the DBPR-RE 11 Sales Associate Broker Sales Associate Transaction form.
Sales Associates or broker associates can only operate under one employer at a time. An employer may be a broker or owner developer. The sales associate or broker associate can be activated through the broker or brokerage’s online account or by filing the appropriate form by selecting the ‘Apply For/Update License’ of the Department web page, to activate with Owner/Developer.
Voluntarily inactive status
A licensee who has qualified for a real estate license but who voluntarily chooses not to engage in the real estate business during a given period and requests such a change is placed on voluntary inactive status.
Involuntarily Inactive Status
Involuntary Inactive licensees are individuals who have failed to complete renewal requirements before their expiration date. Requirements for continuing education and fees and are in their last 24 months of licensing. All requirements for renewal are due by license expiration date to avoid a null and void license. Your expiration date is either March 31st or September 30th midnight Eastern Standard Time. There is no hardship extension for an Involuntary Inactive status renewal.
If a sales associate or broker allows the license to go delinquent/Involuntary Inactive for more than 12 months, but less than 24 months, the licensee is required to complete the 28 hour reactivation education course plus pay all renewal fees plus late fee on or before the end of the 24th month expiration date. Failure to do so will result in the license expiring and going null and void.
Involuntary Inactive licensees are required to complete a 28 hours reactivation education course. This education MUST be completed on or before the expiration date (March 31st or September 30th) midnight Eastern Standard Time to prevent the license going Null and Void.
Initial renewal requires passing the 45 hours of post-license education and paying renewal fees; failure to complete Post License Education or submit fees by the expiration date on your license will result in your license going Null and Void. http://www.myfloridalicense.com/dbpr/real-estate-commission/
Current active licensees (Brokers, Sales Associates) are required to complete 14 classroom hours of 50 minutes each of a FREC approved continuing education course during each biennium (every 2 years) of a license period to remain current. Whether you are Current/Active or Current/Inactive, everyone must complete Continuing Education. Keep in mind, post licensing education must be done in order to renew in the first renewal cycle.
Exempt from Continuing Education
A Florida Bar Member in active/good standing is exempt from the 14 Hour Continuing Education. If you have not informed us that you are a Florida Bar member, please be sure to notify us at 850.487.1395
The department renews a license upon receipt of your renewal application and fee. The renewal application for an active license as broker, broker associate, or sales associate shall include proof satisfactory to the commission that the licensee has, since the issuance or renewal of her or his current license, satisfactorily completed at least 14 classroom hours of 50 minutes each of a FREC approved continuing education course during each biennium (every 2 years) of a license period. 475.182
The 14 hours of continuing education now consists of 3 hours of Core Law, 3 hours of Business Ethics Practices and 8 hours of specialty education. Florida Administrative Code 61J2-3.009(2)
The commission (FREC) may allow you to substitute 3 classroom hours, for attendance of a FREC legal Agenda Session. This may be allowed once per renewal cycle. To obtain credit, the licensee must notify the division at least 7 days in advance of his or her intent to attend. A licensee may not earn any continuing education credit for attending a legal agenda session of the commission as a party to a disciplinary action.
Any license that is not renewed at the end of the license period prescribed by the department shall automatically revert to involuntarily inactive status. Such license may subsequently be renewed only if the licensee meets the other qualifications specified in s. 475.183.
Sixty days before the end of the license period and automatic reversion of a license to inactive status, the department shall mail a notice of renewal to the last known address of the licensee.(475.182)
Members of the Armed Forces (F.S. 455.02)
Any member of the United States Armed Forces now or after while on active duty who, at the time of becoming an Armed Force Member, was in good standing with any of the boards or programs listed in s. 20.165 and was entitled to practice or engage in his or her profession or occupation in the state shall be kept in good standing by the applicable board or program, without registering, paying dues or fees, or performing any other act on his or her part to be performed, as long as he or she is a member of the United States Armed Forces on active duty and for a period of 2 years after discharge from active duty.
A member, during active duty and for a period of 2 years after discharge from active duty, engaged in his or her licensed profession or occupation in the private sector for profit in this state must complete all license renewal provisions, including all education. The license renewal fee is waived.
Spouse of a Member of the Armed Service
A spouse of a member of the United States Armed Forces who is married to a member during a period of active duty, or a surviving spouse of a member who at the time of death was serving on active duty, who is in good standing with any of the boards or programs listed in s. 20.165 shall be kept in good standing by the applicable board or program as described in subsection (1) and shall be exempt from licensure renewal provisions, but only in cases of his or her absence from the state because of his or her spouse’s duties with the United States Armed Forces.
Widow of an Armed Service Member
The department or the appropriate board or program shall waive any license renewal fee for such spouse when he or she is present in this state because of such member’s active duty and for a surviving spouse of a member who at the time of death was serving on active duty and died within the 2 years preceding the date of renewal.
The department shall issue a professional license to an applicant who is or was an active duty member of the Armed Forces of the United States, or who is a spouse or surviving spouse of such member, upon application to the department in a format prescribed by the department. An application must include proof that:
The applicant is or was an active duty member of the Armed Forces of the United States or is married to a member of the Armed Forces of the United States and was married to the member during any period of active duty or was married to such a member who at the time of the member’s death was serving on active duty. An applicant who was an active duty member of the Armed Forces of the United States must have received an honorable discharge upon separation or discharge from the Armed Forces of the United States.
- The applicant holds a valid license for the profession issued by another state, the District of Columbia, any possession or territory of the United States, or any foreign jurisdiction.
- The applicant, where required by the specific practice act, has complied with insurance or bonding requirements.
A complete set of the applicant’s fingerprints is submitted to the Department of Law Enforcement for a statewide criminal history check.
- The department shall waive the applicant’s initial licensure application fee.
- An applicant who is issued a license under this section may renew such license upon completion of the conditions for renewal required of license holders under the applicable practice act, including, without limitation, continuing education requirements. This paragraph does not limit waiver of initial licensure requirements under this subsection.
Effective License – The date whereby the DBPR actually gave the license. Appearing on the actual license as effective date.
Null & Void License
A null and void license means no license at all. This can happen for any of the following:
- An Involuntary Inactive license for more than 2 years
- Permanent Revocation by disciplinary action – there is no recourse for this.
- Failure to complete Post License Education prior to initial expiration
- Voluntary Relinquishment or Cancel – A licensee may wish to end their career for various reasons. License must notify the DBPR in writing they are ending their status as a licensee.
Cease to be in force
When a Sales Associate is changing an employer. His or her license ceases to be in force until the DBPR recognizes the license as registered with the new employer. Because a Sales Associate must work under a Broker, cease to be in force is applied to the license during the employment transition. All Sales Associates must notify The Florida Real Estate Commission (FREC) within 10 days of change of employer. (F.S. 475.23)
Obtaining a license by fraud, misrepresentation or concealment
Multiple and group licenses
multiple licenses – This transaction is used when a broker wishes to qualify more than one sole proprietorship or real estate company. Fee in the amount of $77.00 for each multiple license requested, payable to DBPR
Sales Associates and Broker Associates who are registered with an owner developer that has Real Estate in different names.
Registration of proprietary real estate schools
An applicant for a permit to operate a proprietary real estate school or to be an instructor for a proprietary real estate school or a state institution must meet the qualifications for practice set forth in s. 475.17(1) and the following minimal requirements:
- Before commencing to provide such instruction, the applicant must certify the applicant’s competency and obtain an instructor permit by meeting one of the following requirements:
- Hold a bachelor’s degree in a business-related subject, such as real estate, finance, accounting, business administration, or its equivalent and hold a valid broker’s license in this state.
- Hold a bachelor’s degree, have extensive real estate experience, as defined by rule, and hold a valid broker’s license in this state.
- Pass an instructor’s examination approved by the commission.
- Any requirement by the commission for a teaching demonstration or practical examination must apply to all school instructor applicants.
- The department shall renew an instructor permit upon receipt of a renewal application and fee.
- Recruiting & Advertising
No person representing a real estate school offering and teaching real estate courses under this chapter shall make, cause to be made, or approve any statement, representation, or act, oral, written, or visual, in connection with the operation of the school, its affiliations with individuals or entities of courses offered, or any endorsement of such, if such person knows or believes, or reasonably should know or believe, the statement, representation, or act to be false, inaccurate, misleading, or exaggerated.
(2) A school shall not use advertising of any nature which is false, inaccurate, misleading, or exaggerated. Publicity and advertising of a real estate school, or of its representative, shall be based upon relevant facts and supported by evidence establishing their truth.
(3) No representative of any school or institution coming within the provisions of this chapter shall promise or guarantee employment or placement of any student or prospective student using information, training, or skill purported to be provided, or otherwise enhanced, by a course or school as an inducement to enroll in the school, unless such person offers the student or prospective student a bona fide contract of employment agreeing to employ the student or prospective student. (475.4511)
Real Estate Education and Research Foundation Purpose
- There is established a Florida Real Estate Commission Education and Research Foundation, hereinafter referred to as the “foundation,” which shall be administered by the commission.
- The purposes, objectives, and duties of the foundation are as follows:
- To create and promote educational projects to expand the knowledge of the public and real estate licensees in matters pertaining to Florida real estate.
- To augment the existing real estate programs by increasing the number of teaching personnel and real estate courses in the state in degree-granting programs in universities and colleges in this state.
- To conduct studies in all areas that relate directly or indirectly to real estate or urban or rural economics and to publish and disseminate the findings and results of the studies.
- To assist the teaching program in real estate offered by the universities, colleges, and real estate schools registered pursuant to this chapter in the state, when requested to do so.
- To develop and from time to time revise and update materials for use in the courses in real estate offered by the universities, colleges, and real estate schools registered pursuant to this chapter in the state, when requested to do so.
- To make studies of, and recommend changes in, state statutes and municipal ordinances; provided, however, that such studies are requested by the Governor or the presiding officers of the Legislature. The foundation shall maintain political nonadvocacy.
- To periodically review the progress of persons conducting such research and studies. The results of any research project or study shall not be published or disseminated until it has been reviewed and approved in writing by the commission or its designated representative.
- To prepare information of consumer interest concerning Florida real estate and to make the information available to the public and appropriate state agencies.