I am attending a meeting of the Florida Real Estate Commission. Right now, the Commission is voting on Real Estate Recovery Fund cases. So, I thought I would talk about what we need to know on the state exam regarding the Real Estate Recovery Fund…
- The maximum that will be awarded is $50,000 per transaction or $150,000 per licensee over their lifetime. There was a case today where 53 people were involved in one case against one licensee.
The Commission awarded them $34,450 for the entire group to divide up as they see appropriate. It’s not $34,450 per person.
- The Recovery Fund will only pay actual damages. If the licensee cheats a citizen out of $10,000, but the judge awards the citizen $25,000 ($10,000 for real damages, $10,000 in punitive damages, and $5,000 for court costs and attorney fees), the Recovery Fund will only pay $10,000.
There was a case today where the attorney wanted the Recovery Fund to pay her fees. FREC voted to give the real damages to the client, and the client can choose what to do with that money. They would not give the money to the attorney for her fees.
- Where do the Recovery Fund monies come from? From fees and fines. Fees that each licensee pays when they renew their license, and fines from when licensees are penalized.
- When the Recovery Fund pays money to a citizen because of a licensee, that licensee’s license is suspended until the licensee pays the Recovery Fund back plus interest. This is an automatic suspension and mandatory suspension.
So, in short, we need to know:
- Maximum payout is $50,000 per transaction and $150,000 per licensee.
- Recovery Fund will only pay real damages, not punitive damages (pain and suffering money) and attorney fees or court costs.
- Recovery Fund money comes from fines and fees.
- When the Fund pays money because of you, your license is suspended until you pay it back plus interest.
Please note that neither I, nor anyone in the Climer family, have any affiliation with Climer School of Real Estate. My father, Ron Climer, sold Climer School of Real Estate in 2014. You can find me at Demetree School of Real Estate.