303 National

Question 1

1) The term “seisin” may refer to which of these?

Answer 1

c) General Warranty Deed

Question 2

Executed” means that the Contract has been

Answer 2

d) Completed

Question 3

A father dies and leaves a large piece of investment property (vacant land) equally to all of his children. During the probate proceedings, it is discovered that the father did not own the property alone; he had only 50% undivided interest with another investor as tenants in common. What will be the disposition of the property?

Answer 3

b) The children will each inherit their proportional shares but only of the father’s half.

Question 4

D has adversely possessed a land parcel in Idaho for 25 years, which is the prescribed period for claiming the adverse possession in that state. D now wants to perfect ownership. What is the next step?

Answer 4

c) File a suit to quiet title

Question 5

A history of all instruments on record affecting J’s land is called a(n):

Answer 5

b) Abstract of title

Question 6

What is the value of a property where the gross rent multiplier is 170 and the annual rent is
$12,000?

Answer 6

$170,000

Question 7

Which of these terms does NOT relate to condominiums?

Answer 7

a) Proprietary lease

Question 8

As easement allowing access to one’s landlocked parcel over land between a road and the parcel would be an:

Answer 8

c) Easement by necessity

Question 9

The power of a city to require permits and compliance with building code is:

Answer 9

c) Police Power

Question 10

A state government has a department called the Bureau of Unclaimed Property to manage property for which no owner can be located. This is most closely related to the power called:

Answer 10

b) Escheat

Question 11

Which use would NOT likely be able to claim eminent domain to obtain land?

Answer 11

c) Expansion of a plant facility by the largest employer in the city

Question 12

If the owner of a commercial property makes major modifications to the interior structure of the property without obtaining the proper approval of the local building department, what is the WORST thing that could happen?

Answer 12

c) The local officials may require the modifications to be removed.

Question 13

Which of these would appear in a title search of the property?

Answer 13

d) Deed restrictions

Question 14

Which event will cause a tax-deferred exchange to become partially taxable?

Answer 14

c) Debt relief

Question 15

A special type of zoning that allows a builder to use little or no traditional setback while still complying with density requirements (and often found in Planned Unit Development) is:

Answer 15

a) Cluster zoning

Question 16

Which discrimination is allowed by the 1968 Fair Housing Law?

Answer 16

c) Source of income

Question 17

A tax rate of 7 mills can be expressed as:

Answer 17

d) 0.007

Question 18

If a seller is carrying the financing for a buyer for several years, the IRS wants assurance that the interest rate on that note is not below market rates. These rules are addressed under the concept of:

Answer 18

b) Imputed interest

Question 19

A statement of compliance with fair housing laws is required in every broker’s office in the form of a:

Answer 19

d) Poster

Question 20

Which term does NOT deal with taxation?

Answer 20

d) Prior appropriation

Question 21

Which of these special assessments would not be assessed on an ad valorem basis?

Answer 21

c) A special assessment for sidewalks

Question 22

Which of these brokerage functions would be performed by a broker when the brokerage is closing its own transaction?

Answer 22

a) Preparing a 1099-S for the sale of the seller’s property

Question 23

Is a man who refuses to sell a home to a buyer because she is white violating the law?

Answer 23

a) Yes

Question 24

Which of these is CORRECT regarding taxation?

Answer 24

b) A tax assessed to property according to its value is an ad valorem.

Question 25

Which exchange will NOT qualify as like-kind IRS code section 1031?

Answer 25

b) Personal property

Question 26

P wants to buy a home using VA eligibility, if any. Having a VA entitlement and wishing to buy a home, P may:

Answer 26

d) Obtain 100% financing for the new home

Question 27

Which of these gives basic employment to an area?

Answer 27

b) A military base

Question 28

Which appraisal approach is appropriate to estimate the repairs needed to a restaurant after a fire?

Answer 28

a) Cost

Question 29

Which factor is most harmful to be used for a comparable?

Answer 29

a) The comp was sold 14 months ago.

Question 30

The purchaser has made an earnest money deposit in the agreement, and the buyer and seller have agreed that the seller is to hold it until close of escrow. The proper entry on the closing statement is:

Answer 30

b) Credit buyer and debit seller

Question 31

An appraisal represents:

Answer 31

b) An opinion of the value of the property on the date of the appraisal inspection

Question 32

A property is encumbered by a first mortgage, a second mortgage, a third mortgage and tax lien. The second mortgagee forecloses and the third mortgagee buys the property at the foreclosure sale. Who owns the property subject to which, if any, remaining liens?

Answer 32

d) Owner - 3rd mortgagee. Remaining liens - 1st and tax

Question 33

Regulation Z deals with disclosure of:

Answer 33

c) Costs of credit

Question 34

An appraiser is examining the subdivision layout and proximity to shopping and schools. For which part of the appraisal is this relevant?

Answer 34

a) Neighborhood analysis

Question 35

J has mortgage in which he received regular monthly payments from the mortgagee. What type of loan does J have?

Answer 35

c) Reverse annuity mortgage

Question 36

An agreement between two lenders with the same property as collateral agree to change the priority of their lien is a:

Answer 36

b) Subordination agreement

Question 37

Foreclosure by Mortgage Company Inc. would NOT be triggered by which event?

Answer 37

d) The borrower fails to pay income taxes on income derived

Question 38

The seller has received prepaid rents on the property in the amount of $450. The closing date is the 15th of the month. Which of these is the property entry on the closing statement?

Answer 38

a) Debit seller $225, credit buyer $225

Question 39

The buyer has agreed to assume the prepaid insurance on the property in the amount of $382. The policy expires next June 30th, and the close of escrow is October 22, 1991. Using a 360-day year for prorating, what is the correct entry on the closing statement?

Answer 39

d) Debit buyer $263.16, credit seller $263.16

Question 40

Four brokers meet to assign market segments so each can specialize in a certain price range. This is:

Answer 40

b) Illegal because of federal antitrust laws

Question 41

J has offered property as collateral for a loan but maintains possession of the property. This is an example of:

Answer 41

c) Hypothecation

Question 42

What agency ensures compliance with the Real Estate Settlement Procedures Act?

Answer 42

a) HUD

Question 43

A broker's duties include:

Answer 43

a) A fiduciary duty to the principal

Question 44

Which of these is NOT prorated at the closing of an assumption sale?

Answer 44

a) Mortgage impound (or escrow) account

Question 45

The buyer and seller have agreed to an assumption of the existing first deed of trust, and the seller has agreed to carry back a second deed of trust. The proper entries on the closing statement are:

Answer 45

b) Debit seller for both loans, credit buyer for both loans

Question 46

The seller has a 320-gallon fuel oil tank that is 70% full of the day of closing. The buyer had agreed to pay for the remainder of the oil in the tank. Current fuel oil prices are $1.12 per gallon. What is the amount of the adjustment at closing?

Answer 46

d) $250.88 debit to buyer

Question 47

A new loan in the amount of $76,500 has an annual interest rate of 9.75% and a term of 30 years. The buyer wishes to make payments on the first of the month. The closing is set for September 23, with the first payment due on November 1. What entry is required on the closing statement to accomplish this? Use a 360-day year for prorating

Answer 47

a) Debit buyer $165.75. Logic 76,500*.0975=7,458.75/360=20.71875*8 days= $165.75 Buyer makes payments so he debits.

Question 48

In encouraging salesperson productivity, a strong broker would:

Answer 48

c) Provide programs to motivate associates, such as special classes and marketing strategy sessions

Question 49

Which of these is NOT subject to compliance with the Real Estate Settlement Procedures Act (RESPA)?

Answer 49

a) A purchase money loan from the seller

Question 50

A 15-year mortgage paid and released is:

Answer 50

d) Executed

Question 51

A broker who employs more than 10 salespeople must:

Answer 51

c) Be responsible for the conduct of the sales people

Question 52

Which of these is a specific statutory lien?

Answer 52

b) Mechanic’s lien

Question 53

A vendee to a contract for deed assigns her interest in the contract to an assignee with the vendor agreeing to release the assignor of all liability on the contract. What term best describes what has happened?

Answer 53

d) Novation of the parties

Question 54

Changes to a contract in escrow:

Answer 54

b) Should be signed or initialed by both parties

Question 55

Under which circumstances is an agency terminated with no liability to either party?

Answer 55

b) Expiration of the contract

Question 56

What is the commission rate on a sale of $129,750? The commission was $4,541.25.

Answer 56

a) 3.5%

Question 57

If a parcel neighboring a listed property has recently been rezoned commercial- professional, the out of town seller should be notified of this fact because of the agent's duty of:

Answer 57

c) Disclosure

Question 58

Which licensee would be construed as an independent contractor of the brokerage?

Answer 58

a) A salesperson in general sales

Question 59

Salesperson K of Westside Realty has listed seller R's home. Salesperson W of Eastside Realty has a buyer brokerage agreement with buyer J. Which statement is CORRECT?

Answer 59

c) R is Westside Realty's principal

Question 60

J is a broker representing her investor client B, in acquiring a fourplex. Her duty in the transaction is to:

Answer 60

d) Seek the lowest possible price

Question 61

The Statute of Frauds requires that all of these must be in writing in order to be enforceable EXCEPT:

Answer 61

c) A short term lease

Question 62

Broker J has a listing on a large piece of acreage. The lot lines are very irregular and impossible to measure without a complete survey. J has heard rumors that the parcel is not as large as the seller believes it to be and that the fence along the back actually encroaches upon the next parcel. J is showing the land to a prospective purchaser. J should?

Answer 62

d) Inform both the buyer and seller that there may be some questions of survey

Question 63

J listed a home with broker F on an Exclusive Right to Sell Listing. J sold the property before the Listing expired to his brother-in-law S. Does J owe F a commission?

Answer 63

a) Yes, because the Listing provides for him to receive a commission on any sale

Question 64

A void contract is which of these?

Answer 64

b) A verbal contract of Real Property

Question 65

Which of these contracts is unenforceable?

Answer 65

a) A contract with a minor

Question 66

Which type of insurance is customary for a broker to require of the salespeople in the brokerage?

Answer 66

d) Errors and omissions insurance

Question 67

A portion of a township which is square with mile long sides is called a:

Answer 67

c) Section

Question 68

The rights of a landowner to use waters on an adjacent stream or river are:

Answer 68

d) Riparian rights

Question 69

The grantor's promise to obtain and deliver any instrument needed to make the title good is the covenant of:

Answer 69

d) Further assurance

Question 70

A primary claim or interest anticipated by a title search is a:

Answer 70

d) Cloud

Question 71

Title passes from the grantor to the grantee:

Answer 71

d) When the seller signs the warranty deed and gives to buyer

Question 72

According to RESPA, lenders must provide:

Answer 72

b) A booklet explaining all the costs involved in owning a home

Question 73

All of the following liens must be satisfied in order to transfer clear title EXCEPT:

Answer 73

d) Assumed mortgage

Question 74

A specific lien is:

Answer 74

c) Mortgage

Question 75

The three major evidences of title are:

Answer 75

d) Abstract and opinion, Torrens certificate, title insurance

Question 76

Emblements are considered:

Answer 76

d) Property of the tenant farmer

Question 77

Crops that are growing in a field on a land purchase contract:

Answer 77

d) Are negotiated as part of the contract

Question 78

Jim offers to pay anyone $100 to mow his lawn and trim the bushes. This is an example of:

Answer 78

d) Unilateral contract

Question 79

A recorded legal document that gives constructive notice that an action affecting a certain property has been filed in court:

Answer 79

c) Lis pendens

Question 80

The buyer's legal procedure to enforce a contract is:

Answer 80

d) Specific performance

Question 81

A listing contract under which the broker's commission is contingent on producing a ready, willing and able buyer before the property is sold by another broker or by the owner is a:

Answer 81

d) Open listing

Question 82

A contract may be renegotiated after acceptance if the:

Answer 82

a) Inspection reveals items that need repair

Question 83

Per contract, a home inspection is required on:

Answer 83

d) Home inspections are not required

Question 84

An exclusive right to buy contract (buyer agency) may:

Answer 84

d) All of the above

Question 85

On a purchase contract, the following are considered to be parties to the contract:

Answer 85

a) Buyer, seller

Question 86

A seller hires broker A under the terms of an open listing contract. Broker B would not agree to list under an open listing agreement, so seller enters into an exclusive right to sell list agreement with broker B. Broker A produces an offer to purchase which is accepted by the seller. The seller must pay:

Answer 86

c) Full commission to both broker A and broker B

Question 87

The law that requires real estate contracts to be in writing to be enforceable is:

Answer 87

a) Statute of Frauds

Question 88

Broker A listed a property and later found out that the seller's doctor had declared her incompetent. The listing agreement is now:

Answer 88

d) Voidable

Question 89

Broker A takes a six month listing agreement beginning January 1. On February 22, the seller informs broker A that she no longer wishes to sell. Which of the following is true?

Answer 89

d) The seller may be responsible for broker's expenses