All Flashcards
What is a Chattel
items of personal property, including such tangibles as chairs, tables, clothing, money, bonds, and bank accounts
What is a fixture?
personal property that has been so affixed to land or a building that, by law, it becomes part of the real property
what is a trade fixture?
an article owned by a tenant attached to a rental space or building or used in conducting a business
What is an apartment complex?
groups of apartment buildings with any number of units in each building
what is a condominium
a popular form of residential ownership, particularly for people who want the security of owning property without the care and maintenance a house demands.
what is a cooperative
similar to condos in that it also may offer units with shared common facilities, unlike condos, the “owners” do not actually own the units. They buy shares of stock in the corporation that holds title to the building.
what are planned unit developments
merge such diverse land uses as housing, recreating facilities, and commercial concerns in one self-contained development.
what are highrise developments
combine elements as office space, stores, theaters, and the apartment units into a single vertical community.
what are converted use properties
factories, warehouses, office buildings, hotels, schools, churches, and other structures that have been converted to residential use.
what is manufactured housing
mobile homes, considered more often permanent principal residences or stationary vacation homes.
what are modular homes
each room is a per-assembled piece in a factory and taken to the building site on a truck.
What is a time-share
allow multiple purchasers to share ownership of a single property, usually a vacation home. Each owner is entitled to use the property for a certain period fo time each year, usually a specific week.
What are the different types of leasehold estates?
Estate for years, Estate from Period to Period, Estate at Will, Estate at Sufferance.
What is an estate for Years
a leasehold estate that continues for a definite period of time.
what is an estate from period to period
created when the landlord and the tenant enter into an agreement for an indefinite time.
What is tenancy at will
gives the tenant the right to possess property with the landlrod’s consent for an unspecified or uncertain term.
what is tenacy at sufferance
when a tenant who lawfully possessed real property continues in possession of the premises without the landlord’s consent after the rights expire.
how to calculate annual taxes
(Assessed value * eq factor - exemptions)*tax rate
Who establishes guidelines for real estate licensees in properly advertising properties in compliance with fair housing law
HUD
What regulatory agency was established under the Dodd-Frank Wall Street Reform and Consumer Protection Act?
Consumer Finance Protection Bureau
What regulation changed the disclosures required in a real estate transaction in which there is a mortgage loan and became effective October 3, 2015?
TRID
What state agency is responsible for providing the information on the hazards of radon gas pursuant to the Illinois Radon Awareness Act
Illinois Emergency Management Agency
Which law requires the disclosure of affiliated business relationships and prohibits kickbacks among service providers in a real estate transaction?
Real estate settlement procedures Act
Information which is gathered to determine air quality, noise, public health and safety, energy consumption, population density, wildlife and infrastructure is a/an:
environmental impact statement
Which of these is a lien on real estate? A) Recorded Easement B) Recorded Mortgage C) Encroachment D) Deed Restriction
Recorded easement (pg 171)
A sales contract was signed under duress. Which os these describes the contract? A) Voidable B) Breached C) Discharged D) void
voidable (page 192)
A sponsoring broker receives a check for earnest money from a buyer and deposits the money in the sponsoring broker’s personal interest-bearing checking account over the weekend. This action exposes the sponsoring broker to a charge of
commingling pg 37
a borrower takes out a mortgage loan that requires monthly payments of 875.7 for 20 years and a final payment of 24095. What type of loan is this?
balloon pg 305
When demand for a commodity decreases and supply increases:
price tends to fall pg 6
A broker signs a contract with a buyer. Under the contract, the broker agrees to help the buyer find a suitable property and to represent the buyer in negotiations with the seller. Although the buyer may not sign an agreement with any other broker, she may look for properties on her own. The broker is entitled to payment only if the broker locates the property that is purchased. What kind of agreement has this broker signed?
exclusive-agency buyer agency agreement pg 103
A man conveys property to a woman by delivering a deed. The deed contains five covenants. What type of deed is this most likely to be?
warranty deed pg 224-225
A real estate licensee does not show non-asian clients any properties in several traditionally asian neighborhoods. She bases this practice on the need to preserve the valuable cultural integrity of Asian immigrant communities. Which of these statements in TRUE?
A) The licensee’s policy is steering and violates the fair housing laws regardless of her motivation
B) Because the licensee is not attempting to restrict the rights of any single minority group, the practice does not constitute steering.
C) The licensee’s policy is steering, but it does not violate the fair housing laws because she is motivated by cultural preservation, not by exclusion or discrimination.
D) The licensee’s policy has the effect, but no the intent of steering
The licensee’s policy is steerring and violates the fair housing laws regardless of her motivation pg 402
a grandmother grants a life estate to her grandson and stipulates that on the grandson’s death, the title to the property will pass to her son-in-law. What kind of estate is the second estate?
the remainder pg 121
Which of these is TRUE concerning a property held in joint tenancy?
A) a maximum of two people can own the real estate
B) The fractional interests of the owners can be different.
C) additional owners may be added later
D) There is always the right of survivorship
there is always the right of surviviorship pg 136
a real estate licensee has a written contract with his sponsoring broker that specifies that he will not be trated as an employee. The licensee’s entire income is from sales commissions rather than an hourly wage. For federal income tax purposes, the licensee is considered what type of worker?
an independent contractor pg 64
The states in which the lender holds title to mortgaged real estate are called:
title-theory states pg 281
The form of tenancy that expires on a specific date is:
tenancy for years pg 320
A suburban home that lacks indoor plumbing suffers from
functional obsolescence pg 364
if a developer wants to build a commercial building closer to the street than is permitted by the local zoning ordinance because the shape of the lot makes a standard setback impossible, the developer should seek a:
variance pg 385
a licensee showed an owner-occupied property that had window screens, custom Venetian blinds, and a wall bed to a buyer. The owner accepted the buyer’s offer. What may the seller remove before closing?
none of these identified items pg 17
a real estate broker specializes in helping both buyers and sellers fill in the blanks and negotiate the terms of the contract. Because the broker is an agent of both parties, he may not disclose either party’s confidential information to the other. What kind of agent is the broker?
a dual agent pg 52-53
The portion of the value of an owner’s property that exceeds the amount of the owner’s mortgage debt is called:
equity pg 25
in a 28/36 ratio, the 36 means
recurring long-term debts and housing payment combined may not exceed 36% of gross monthly income pg 307-308
police powers include:
- Deed restrictions
- Zoning
- Restrictive covenants
- taxation
zoning pg 116
A seller wants to net 165,000 from the sale of her house after paying the sponsoring broker’s fee of 5%. What should the seller’s gross price be?
$173,684 pg 94
How many square feet are in three acres?b 10
130,680 pg 160
a purchaser obtains financing from a local savings association to purchase a condominium unit. In this situation, which of these best describes the purchaser?
- Vendor
- Mortgagor
- Grantor
- Lessor
mortgagor pg 281
the current value of a property is 240,000. The property is assessed at 40% of its current value for real estate tax purposes with an equalization factor of 1.5 applied to the assessed value. if the tax rate is $4 per $100 of assessed valuation, what is the amount of tax due on the property?
$5760 pg 175
A building was sold for $360000 with the purchaser putting 10% down and obtaining a loan for the balance. The lending institution charged a 1% loan origination fee. What was the total cash used for the purchase?
$39,240 pg 284
Several brokerage firms were accused of violating antitrust laws. Of the following, they were MOST likely accused of:
- not having an equal housing opportunity sign in an office windows
- undisclosed dual agencies
- price-fixing
- dealing in unlicensed exchange services
price-fixing page 78
a capitalization rate is the
rate of return a property will produce on the owner’s investment page 366
the national do not call registry provides that
consumers who have made an inquiry to a licensee may be contacted up to three months later page 79-80
if a house was sold for $140,000 and the buyer obtained an FHA-insured mortgage loan for $133,700 how much money would the buyer pay in discount point if the lender charged two points?
$2,647 pg284
the commission rate if 7.75% on a sale of $250,000. What is the dollar amount of the commission?
$19,375 pg78
The buyer makes an offer on a property and the seller accepts. Three weeks later, the buyer announces that “The deal’s off” and refuses to go through with the sale. if the seller is entitled to keep the buyer’s earnest money deposit, it is MOST likely because the sales contract contains what kind of clause?
a liquidated damages clause pg194
until the land contract is paid in full, what is the status of the purchaser’s interest in the property?
purchaser has equitable title in the property pg215
Three years ofter signing a five-year lease, business A outgrew its rental space. Business A would like business B to take on the responsibility of the lease for the remaining two years. B can do this through a(n)
an assignment pg327-328
An ownership interest that permits multiple purchasers to buy interests in the same piece of real estate is a
time-share pg148
For an offer to purchase real estate to become a sales contract, whos signature is necessary?
buyer’s and seller’s pg189-190
A borrower just made the final payment on a mortgage loan. Regardless of this fact, the records will still show a lien on the mortgaged property until what happens?
a satisfaction of the mortgage document is recorded pg287
if the annual net income from a commercial property $22,000 and the capitalization rate is 8%, what is the value of the property using the income approach?
$275,000 pg365-366
A sponsoring broker enters into a listing agreement with a seller in which the seller will receive $120,000 from the sale of a vacant lot and the sponsoring broker will receive any sale proceeds exceeding that amount. This is what type of listing?
Net pg89
an individual sold her house and moved into a cooperative apartment. Under the cooperative form of ownership, the individual will:
Become a shareholder in the corporation pg147
A defect or a cloud on title to property may be cured by
obtaining proof of satisfaction from all appropriate parties pg240
A buyer signed an exclusive-agency buyer agency agreement with a sponsoring broker. If the buyer finds a suitable property with no assistance from any licensee, the sponsoring broker is entitled to what kind of compensation
No compensation under the terms of this type of agreement pg103
Under the terms of a net lease, a commercial tenant usually would be responsible for paying:
real estate taxes pg329
the fair housing act of 1968 prohibits discrimination based on:
race pg397
If a borrower must pay $6,000 for points on a $150,000 loan, how many points is the lender charging for this loan?
4 pg284
What is the difference between a general lien and a specific lien?
a specific lien is alien against a certain parcel of real estate, while a general lien covers all of a debtor’s property pg171
in an option to purchase real estate, which of these statements is TRUE of the optionee?
- the optionee must purchase the property but may do so at any time within the option period.
- the optionee is limited to a refund of the option consideration if the option is exercised
- the optionee cannot obtain third-party financing on the property until after the option has expired.
- the optionee has no obligation to purchase the property during the option period
the optionee has no obligation to purchase the property during the option period pg214
In 2004, an owner constructed a building that was eight stories high. In 2014, The municipality changed the zoning ordinance a prohibited buildings taller than six stories. Which of these statements ins TRUE regarding the existing eight-story building?
- the building must be demolished
- the building is a conditional use
- the building is a nonconforming use
- The owner must obtain a variance
The building is a nonconforming use pg385
How many acres are there in the north 1/2 of the south west 1/4 and the north east 1/4 of the south east 1/4 section?
120 pg159
A home is the smallest in a neighborhood of large, expensive houses. The effect of the other houses on the value of this particular home is called
Progression pg360
What kind of lien is created as a result of a judgement, estate or inheritance taxes, the decedent’s debts, or unpaid federal income taxes?
General pg171
A broker received a deposit along with a written offer from a buyer. The offer stated: “The offeror will leave this offer open for the seller’s acceptance for a period of 10 days.” On the fifth day, and before acceptance by the seller, the offeror notified the broker that the offer was withdrawn and demanded the return of the deposit. Under these circumstances, the offeror
has the right to withdraw the offer and secure the return of the deposit any time before being notified of the seller’s acceptance. (pg 189 - 190)
A man and a woman own property as joint tenants. The woman sells her interest co another woman. What is the relationship between the man and the second woman regarding the
Property?
Tenants in common (pg 138)
A property owner and a tenant verbally enter into a six-month lease. If the tenant defaults, the property owner may:
- not bring a court action because six-month leases must be in writing under the parol evidence rule.
- not bring a court action because the statute of frauds governs six-month leases
- bring a court action because six-month leases need not be in writing to be enforceable
- bring a court action because the statute of limitations does not apply to oral leases, regardless of their term.
bring a court action because six-month leases need not be in writing to be enforceable (pg 320)
On monday, a woman offers to sell her vacant lot to a man for $35,000. On tuesday the man counteroffers to buy the lot for $25,500. On Friday, the man withdraws his counteroffer and accepts the Woman’s original price of $35,000. Under these circumstances,
- a valid agreement exists because the man accepted the woman’s offer exactly as it was made, regardless of the fact that it was not accepted immediately.
- a valid agreement exists because the man accepted before the woman advised him that the offer was withdrawn.
- no valid agreement exists because the woman’s offer was not accepted within 72 hours of its having been made.
- no valid agreement exists because the man’s counteroffer was not withdrawn within 24 hours.
no valid agreement exists because the man’s counteroffer was not withdrawn within 24 hours. (pg 189-190)
A property owner’s neighbors use her driveway to reach their garage, which is on their property. The property owner’s attorney explains that the neighbors have an easement appurtenant that gives them the right to use her driveway. The property owner’s property is what kind of tenement?
servient tenement (pg 125)
What action returns the parties to a contract to their original positions, before the contract, including the return of any deposits?
Rescission (Page 195)
A deed conveys ownership to the grantee “as long as the existing building is not torn down.” What type of estate does this deed create?
A (page 120)
Taxes levied on a property owner to pay for installation of sidewalks or sewers are called
ad valorem taxes (page 173)
What do local zoning ordinances regulate?
permitted land uses (pg 382)
a sponsoring broker took a listing and later discovered that a court had previously declared the client incompetent. At this point the status of the listing is
of no value to the sponsoring broker because the contract is void (page 191)
a borrower defaulted on his home mortgage loan payments, and the lender obtained a court order to foreclose on the property. At the foreclosure sale, The property sold for $164,000; the unpaid balance on the loan at the time of foreclosure was $178,000. What must the lender do to recover the $14,000 that the borrower still owes?
seek a deficiency judgment (page 293)
Which of these is except from the federal fair housing act of 1968?
- the sale of listed, owner-occupied single family home when the listing broker does not advertise the property
- the refusal to rent to an apartment to a physically disabled person
- an owner-occupied building with no more than four units
- The restriction of noncommercial housing where a certified statement has not been filed with the government
an owner-occupied building with no more than four units (page 400)
when compared with a 30 year payment period, taking out a loan with a 20 a year payment period, taking out a loan with a 20 year payment results in?
Higher monthly payments (page 304)
A licensee arrives to present a purchase offer to an older man, who is seriously ill, and finds the man’s son and daughter in law also present. The son and daughter in law urge the man to accept the offer, even though it is much less than the asking price for the property. If the man accepts the offer, the man may later claim that
- the licensee improperly presented an offer that was less than the asking price
- the licensee’s failure to protect the man from the son and daughter in law constituted a violation of the licensee’s fiduciary duties.
- The mans’ rights under the ADA have been violated by the son and daughter in law
- the man was under undue influence from the son and daughter in law, so the contract is voidable.
the licensee’s failure to protect the man from the son and daughter in law constituted a violation of the licensee’s fiduciary duties. (page 35)
a deed of conveyance contained only the following guarantee: “This property was not encumbered during the time the grantor owned it except as noted in this deed.” What type of deed did the grantor give to the grantee?
Special warranty (page 225)
An unmarried couple owns a parcel of real estate. Each owns an undivided interest, with the man owning one third and the woman owning two thirds. The form of ownership under which the couple owns their property is
tenancy in common (page 135)
A man agrees to purchase a house for $84,000. He pays $2,000 as earnest money and obtains a new mortgage loan for $67,000. The purchase contract provides for a march 15 settlement. He and the sellers prorate the present year’s real estate taxes of $1,880.96, which have been prepaid. The man has additional closing costs of $1,250, and the sellers have other closing costs of $850. Using the actual number of days method, how much cash must the man bring to the settlement?
$19,649 (Page 456)
A broker advertised a house he had listed for sale at the price of $247,900. An African American saw the house and was interested in it. When the prospect asked the broker the price of the house, the broker told the prospect $253,000. Under the federal fair housing act of 1968, such a statement is
Illegal because the terms of the potential sale were changed for the african american (page 399)
An owner placed her farm in a trust, naming herself as the beneficiary. When the owner died, her will directed the trustee to sell the farm and distribute the proceeds of the sale to her heirs. The trustee sold the farm in accordance with the will. What type of deed was delivered at settlement?
Trustee’s deed (Page 142)
An appraiser has been hired to prepare an appraisal report of a property for loan purpose. The property is an elegant old mansion that is now leased out as a restaurant. To which approach to value should the appraiser probably give the greatest weight when making this appraisal?
Income (page 365)
An applicant applies for a mortgage, and the loan officer suggests that she might consider a term mortgage loan. Which of these statements BEST explains what the loan officer means?
- All the interest is paid at the end of the term
- The debt is partially amortized over the life of the loan
- The length of the term is limited by state law
- The entire principal amount is due at the end of the term
The entire principal amount is due at the end of the term (page 303)
A condominium community offers a swimming pool, tennis courts, and biking trail. These facilities are most likely owned by who?
Unit owners in the form of percentage undivided interests (page 145)
On a closing statement in a typical real estate transaction, the buyer’s earnest money deposit is reflected as a:
- credit to the buyer and a debit to the seller.
- credit to the seller and a debit to a buyer.
- credit to both the buyer and the seller
- debit to the buyer only
credit to the buyer and a debit (page 454)
prepaid insurance and tax reserves, in which the buyer assumes the mortgage, will appear on a typical closing statement as a
- credit to the buyer and a debit to the seller
- credit to the seller only
- debit to the seller only
- debit to the buyer and a credit to the seller
debit to the buyer and a credit to the seller (page 454)
real property can become personal property by the process called
severance (page 17)
Property owners give a neighbor permission to park a camper in their yard for a few weeks. The property owners do not charge rent for the use of the yard. The property owners have given the neighbor
a license (page 127)
a tenant’s lease has expired, but the tenant has not vacated the premises or negotiated a renewal lease. The landlord has declared that the tenant is not to remain in the building. This situation is an example of
tenancy at sufferance (page 322)
A property owner signs a listing agreement with a sponsoring broker. A second broker obtains a buyer for the house, and the sponsoring broker does not receive a commission. The sponsoring broker does not sue the seller. The listing agreement between the seller and the sponsoring broker was most likely what kind of agreement?
an open agreement (page 89)
A sponsoring broker established the following office policy “All listings taken by any licensee associated with this real estate brokerage must include compensation based on a 5% commission. No lower commission rate is acceptable.” If the sponsoring broker attempts to impose this uniform commission requirement. which of these statements is true?
- a homeowner may sue the sponsoring broker for violating the antitrust law’s prohibition against price-fixing
- the licensee associated with the brokerage will not be bound by the requirement and may negotiate any commission rate they choose.
- the sponsoring broker must present the uniform commission policy to the local professional association for approval
- the sponsoring broker may, as a matter of office policy, legally set the minimum commission rate acceptable for the firm.
the sponsoring broker may, as a matter of office policy, legally set the minimum commission rate acceptable for the firm. (page 75)
Because the owner of an apartment building failed to perform routine maintenance, the apartment building’s central heating system broke down in the fall. The owner neglected to have the heating system repaired, and a tenant had no heat in her apartment for the first six weeks of winter. Although eight months remained on the tenant’s lease, she moved out of the apartment and refused to pay any rent. If the owner sues to recover the outstanding rent, What would be the tenants best defense?
The landlord’s actions constituted constructive eviection (Page 327)
A buyer purchased a parcel of land and immediately sold the mineral rights to an oil company. The buyer gave up which one of his rights?
Subsurface rights (Page 13)
A developer built a six story structure. Several years later, an ordinance was passed in that area banning any building six stories or higher. This building is a…
nonconforming use (Page 384 - 385)
What is the maximum capital gains tax exclusion allowable for a married couple, filing jointly, who have lived in their home for the past 3.5 years?
$250,000 (Page 26)
Statements by a real estate licensee that somewhat exaggerate the intangibles of a property without committing fraud are called
puffing (Page 42)
When planning a subdivision, a developer should determine the kinds of land uses to be involved and the amounts of land to be allocated to each use by considering
The comprehensive plan of the local government (Page 381-382)
Which of these is TRUE regarding condominiums?
- If a unit owner does not pay the monthly maintenance fee, the entire community will be foreclosed
- The covenants and restrictions define the responsibilities of the owners and declare how the homeowners association will operate the condo community
- If one unit owner defaults on property taxes, those taxes will be owed by the remaining owners
- A condominium unit may be mortgaged like any other parcel of real estate
A condominium unit may be mortgaged like any other parcel of real estate (Page 145)
Which of these is a legal practice?
- to refuse to sell, rent or negotiate with a person because of race
- as a property manager, to check the credit of females only
- to display the equal housing opportunity poster
- to refuse to let persons with a disability, at their expense, modify a dwelling
To display the equal housing opportunity poster (Page 145)
Which of these is a voidable contract?
- a contract with no contingencies
- A contract entered into on a legal holiday
- A contract that has not been recorded with the recorder of deeds
- a contract entered into by a minor
A contract entered into by a minor (Page 192)
An owner entered into a three- month listing agreement with a sponsoring broker. Last week, the owner also entered into the same three month listing agreement with two separate brokers. What kind of listing has the owner negotiated?
open listing (Page 89)
An appraiser was contracted to determine the value of a large apartment building for a potential investor client. Which appraisal method is the MOST useful for this type of property?
income approach (Page 365)
A large manufacturing company agrees to relocate to an economically depressed neighborhood of Chicago if the city can provide suitable property in a short period. The property needed is a large vacant lot owned by an investment partnership that refused to sell. if the City of Chicago wants to relieve unemployment in the neighborhood and improve commercial conditions in the city by bringing in the manufacturer immediately, what can the city legally do?
Obtain immediate rights of possession and use by depositing a sum of money that a court preliminarily considers to be just compensation with the county treasurer through a process called quick take (Page 117)
Illinois law requires that a reprinted offer to purchase that is intended to become a binding contract have which of these headings?
- Real Estate Sales Contract
- Offer to Purchase
- Standard Purchase Offer and Contract
- Purchase offer form
Real Estate Sales Contract (Page 196)
In 1971 a developer conveyed a motel and restaurant to an investor “on condition that no liquor is ever served on the property.” The conveyance provided that if liquor were served on this property, ownership would revert to the developer. In 2014, the investor sold the motel and restaurant to his son Based on these facts, which statement is TRUE:
- The sale of the motel and restaurant in 2014 extinguished the developer’s right of reverter
- Both the developer’s right of reverter and the condition expired by operation of illinois statute in 2000; the investor is free to sell the motel and restaurant without condition
- While the condition continues forever, the developer’s right of reverter expires after 40 years.
- Both the condition and the developer’s right of reverter automatically expired in 2005
While the condition continues forever, the developer’s right of reverter expires after 40 years. (Page 119-120)
A couple is married, and both are illinois residents. If their co-owned home is sold to satisfy their unpaid credit card debts, what is the maximum the creditors will receive if the property sells for $165,000?
$135,000 (Page 123)
Which of these statements in a deed would establish a valid tenancy by the entirety in illinois?
- “To A and B, a lawfully married couple, as tenants by the entirety”
- “To A and B, husband and wife, not as joint tenants or tenants in common but as tenants by the entirety”
- “To A and B jointly, as married tenants by the entirety”
- “To A and B as tenants by the entirety in accordance with illinois law”
“To A and B, husband and wife, not as joint tenants or tenants in common but as tenants by the entirety” (Page 139)
An ownership arrangement in which the purchaser receives a fee simple ownership in real property for longer than three years but the right to actually use the property for a specific period of less than one year (on a recurring basis) is a…
time-share estate (Page 148-149)
Which of these would be required to be surveyed and have a plat recorded under the illinois plat act?
- An owner divides a 30-acre parcel into five equal lots
- An owner divides a 20-acre parcel into five equal lots.
- An owner conveys a single 20-acre parcel
- An owner divides a single 20-acre parcel into two 6-acre lots and an 8-acre lot
An owner divides a 20-acre parcel into five equal lots. (Page 164)
The general datum plane referred to by surveyors throughout illinois is the
North American Vertical Datum (Page 165)
While the identity is of the beneficiary of a land trust is not usually disclosed without the beneficiary’s written permission, under what conditions may the trustee be compelled to do so?
*When applying to a state agency for a license or permit affecting the property (Page 142)
An owner paid the first installment of her illinois general real estate tax on july 1. The amount due was $2,380. If the county assessor issued the owner’s bill 30 days before the penalty date of June 1, does the owner owe any penalty?
Yes; the owner will have to pay $71.40 as a penalty in addition to the real estate tax owed
A judgment issued by an illinois court is what kind of lien?
General, involuntary, equitable lien on both real and personal property owned by the debtor. (Page 180)
A man owned property in Peoria before his marriage. The wife has no ownership interest in the property. The owner and his wife live in Chicago, and a tenant occupies the house in Peoria. If the owner wants to sell the property, who is required by law to sign the listing agreement?
The owner only because he and his wife do not live in the house (Page 122-123)
A common item appearing in an illinois listing agreement is
The time duration of the listing (Page 102)
In illinoi, which agency is responsible for licensing leasing agents?
Illinois department of financial and professional regulation (Page 248)
In illinois, when a sponsoring broker is taking a listing and asks the seller to complete a disclosure of property conditions,
- The disclosures are optional, and the seller may avoid liability by refusing to make any disclosure about the condition of the property.
- The standard disclosures cover a narrow range of structural conditions only
- The sponsoring broker should give the seller advice regarding which property conditions to disclose and which to ignore
- seller disclosure of known property conditions is requires by illinois statue
seller disclosure of known property conditions is requires by illinois statue (Page 37)
How long must a claimant hold adverse, exclusive, continuous, and uninterrupted use of a property under claim of right in illinois in order to obtain a prescriptive easement in illinois?
20 years (page 126)
An illinois real estate licensee is the listing agent for a home. After one month of the three month listing passes without any offers on the property, the licensee becomes concerned. At the time the listing agreement was signed, the licensee and the sellers orally agreed that if no offers were received after one month, the price of the property would be reduced by 10% because the sellers are out of town, the licensee crosses out the old listing price, writes in the new one, and then updates the information on the multiple listing service. Three days later a prospective buyer comes into the listing licensee’s office to make an offer on the property. Based on these facts, which of these statements is true?
- Illinois licensee are prohibited by law from making any addition to, deletion from, or other alteration of a written listing agreement without the written consent of the principal
- although illinois law usually prohibits altering a written listing agreement, the listing licensee acted properly in this situation because the sellers were out of town
- changing the listing price of a property is a matter of professional discretion, and illinois licensees are permitted to make alterations to only that aspect of a listing agreement without the written consent of the principal
- Although illinois law usually prohibits altering a written listing agreement, the listing licensee acted properly in this situation because of the prior oral agreement with the sellers.
Illinois licensee are prohibited by law from making any addition to, deletion from, or other alteration of a written listing agreement without the written consent of the principal (Page 196)
A sponsoring broker signs a listing agreement with a seller. The agreement contains the following clause: “If the property has not been sold after three months from the date of this signing, this agreement will automatically continue for additional three-month periods thereafter until the property is sold.” Based on these facts, which statement is TRUE?
- The agreement is legal under illinois law because it contains a reference to a specific time limit
- This agreement is illegal in illinois
- illinois law will automatically apply a statutory six-month lasting period to this open listing
- This agreement is legal under illinois law because the time periods are for less than six months each
This agreement is illegal in illinois (Page 102)
Under land contract in in illinois, what type of title does the purchaser have until the final closing when the obligation to the seller is paid in full?
Equitably title (Page 215)
How are the members of the illinois real estate administration and disciplinary board selected
Appointed by the governor (Page 249)
What is the advantage of seeking an injunction against a licensee who is violating the real estate license act of 2000?
It stops the violation from continuing (Page 273)
An illinois licensee’s license may be suspended or revoked for which of the following actions?
- Giving earnest money to his or her sponsoring broker rather than depositing it directly
- being declared mentally incompetent
- disclosing agency
- Displaying a for sale sign on a property with the owner’s consent
Being declared mentally incompetent (Page 269)
In illinois, which of these is a required element of a valid deed?
- Specifically identified grantee
- Notarization of grantees’ signature
- Hold harmless clause
- Name of the lender
Specifically identified grantee (Page 221)
An approximately straight line (Except for corrections) connecting rockford and Cairo is the
Third principal meridian (Page 157)
A sponsoring broker received an earnest money deposit along with a sales contract from a buyer. Under Illinois law, what must the sponsoring broker do with the money?
Deposit the money in an existing special non-interest bearing escrow account in which all earnest money received from buyer may be held at the same time (Page 37)
Chicago bar association, el al v. quinlan and tyson, inc., established what principal in illinois real estate law?
Real estate licensees may only fill in blanks and make appropriate deletions on preprinted standard form contracts (Page 196)
Under illinois law, what is the statutory usury ceiling on loans secured by real estate?
No limit (Page 283)
A real estate licensee is aware that certain areas of the city are particulary unfriendly to members of certain minority groups. For these groups’ own protection, the licensee shows members of such groups homes for sale only in “Friendly” neighborhoods into which members of their minority group have moved int eh past. Based on these facts, which of these statements is true?
- The real estate license act of 2000 does not prohibit the licensee’s actions because the licensee is being protective rather than discriminatory
- The critical element in this type of activity is profit motive; if the licensee’s actions are not driven by increased profits, the licensee will not be subject to discipline under the Real Estate License Act of 2000
- While the licensee’s actions are clearly prohibited by Illinois statute, the Real Estate License Act of 2000 does not address blockbusting or steering
- The licensee’s actions are expressly prohibited by the Real Estate License Act of 2000.
The licensee’s actions are expressly prohibited by the Real Estate License Act of 2000. (Page 270)
The sale price of the property is $250,000. What is the Illinois state transfer tax on this transaction?
$250 (Page 226 - 227)
IDFPR may NOT
- Conduct license examinations
- Issue and renew licenses
- impose jail time on persons who violate license law
- collect fees from applicants and licensees
impose jail time on persons who violate license law (page 272-273)
In illinois, how must the real property transfer tax be paid?
By purchasing transfer tax stamps from the county recorder or appropriate local authority (Page 228)
In illinois, which property is totally exempt from paying general real estate taxes?
Private Schools (Page 173)
A landlord has a “no pets” policy in his apartment building. If a visually impaired person wants to rent an apartment from the landlord, but owns a guide dog, which of these statements is TRUE?
- If the landlord’s “no pets” policty is applied uniformly, in a nondiscriminatory manner, it may be legally applied to the guide dog as well.
- The illinois human rights at specifically specifically prohibits the landlord from refusing to rent the apartment to the visually impaired person on the basis of the landlord’s “no pets” policy
- Under the illinois Human Rights Act, the landlord may not discriminate against the visually impaired person on the basis of a “no pets” policy, but the landlord may require the tenant to pay an additional damage fee.
- The illinois Human rights act does not address the issue of guide, hearing, or support dogs
The illinois human rights at specifically specifically prohibits the landlord from refusing to rent the apartment to the visually impaired person on the basis of the landlord’s “no pets” policy (Page 400)
Real property was conveyed for $185,000. What amount will have to be paid in county transfer tax?
$92.50 (Page 226 - 227)
Which of these statements is TRUE of all illinois county having fewer than 60,000 residents?
- The recorder of deeds must be elected.
- deeds are recorded by the elected recorder of deeds in the nearest county having a population over 60,000.
- The city clerk of the largest population center acts as recorder of deeds
- The county clerk of the largest population center acts as recorder of deeds
- The county clerk also serves as recorder of deeds
The county clerk also serves as recorder of deeds (Page 238)
Which is a requirment for a deed to be recorded in illinois
- The name of the grantee typed or printed below the grantee’s signature
- Payment of required tax stamps
- A blank page for use by the recorder
- The name, address, and age of the grantee
Payment of required tax stamps (page 239)
What is the purpose of the Real Estate Recover Fund?
Compensate individuals who suffer losses due to the wrongful acts of a licensee (Page 274)
Which activity requires a real estate license?
- An MLS providing listing information to members
- A resident manager who collects rent on behalf of a building owner
- A service that, for a fee, matches individuals who want to buy a sell properties
- An executor selling a decendent’s building
A service that, for a fee, matches individuals who want to buy a sell properties (Page 250 - 251)
In illinois, if the buyer of a property is a licensed broker,
- the buyer does not need to disclose this fact
- This must be disclosed after closing
- the buyer must only disclose if asked
- This must be disclosed in writing to the parties to the transaction
This must be disclosed in writing to the parties to the transaction (Page 267)
What is the name of the act that requires that illinois developer file statements of record with HUD before they offer unimproved lots for sale in interstate commerce via telephone?
Interstate land sales full disclosure act (Page 389)
in illinois, if an owner defaults on a mortgage loan and the property is ordered sold at a foreclosure sale, the owner may redeem the property..
- before the sale, under the statutory right of redemption.
- before the sale, under the equitable right of redemption
- after the sale, under the equitable right of redemption
- after the sale, under the statutory right of redemption.
- after the sale, under the equitable right of redemption
before the sale, under the equitable right of redemption (Page 292)
For three days, a man watched from his kitchen window as a small construction crew built an attractive gazebo in his backyard. The man had not contracted with anyone to build a gazebo and in fact had never given much thought to having one. but the man liked what he saw. When the contractor presented the man with a bill for the work, the man refused to pay, pointing out that he’d never signed a contract to have the work done. Can the contractor impose a mechanic’s lien on the man’s property under illinois law?
yes; if a landowner knows of work being done on the property and does not object or disclaim responsibility, and mechanic’s lien may be created (Page 179)
A woman’s property in Peoria has an assessed value of $175,000. The local tax rate is 3%, and no equalization factor is used. If the tax was levied in april 2011, the woman had to pay how much?
$2,625 on June 1, 2012 (page 176)
In illinois, real estate licensees may:
- Complete a bill of sale after a sales contract has been signed
- fill in blanks on preprinted form contracts customarily used in the their own community
- Suggest additional language to be added to a preprinted sales contract by a buyer or a seller.
- explain the legal significance of specific preprinted contract clauses to a buyer or seller
fill in blanks on preprinted form contracts customarily used in the their own community (page 196)
For which of the following acts is IDFPR required to suspend or revoke a licensee’s license?
- failing to perform as promised in a guaranteed sales plan
- having been found liable in a civil trial for illegal discrimination
- commingling others’ money or property with the licensee’s own
- failing to provide information requested by IDFPR within 30 days of the request as part of a complaint or audit procedure
having been found liable in a civil trial for illegal discrimination (Page 271)
Three weeks before a man begins his illinois real estate prelicense class, he offers to help his neighbor sell her house. The neighbor agrees to pay him 5% commission. An offer is accepted while the man is taking the class and closes the day before the man passes the examination adn receives his real estate license. The neighbor refuses to pay the man the agreed commission. Can the man sue to recover payment?
no; illinois law prohibits lawsuits to collect commissions unless the injured party is a real estate licensee, and the license was in effect before the agreement was reached. (Page 76)
A woman has a mortgage loan secured by real property. Under recent law, the woman may terminate the loan’s escrow account when the remaining balance is equal to or less than what percentage of the original amount
65% (Page 307)
Three people decide to form a partnership to buy and sell real estate. One partner plans to specialize in residential real estate, the second in commercial real estate, and the third does not plan to list, sell, or rent, but to supervise the office decor and plan holiday parties. Under these facts, which of the general partners needs to be licensed for the partnership to qualify for a broker’s license in Illinois
all general partners in a general partnership must hold a broker or managing broker license (page 143)
Regarding mortgages, illinois is most accurately described as:
- an intermediate mortgage theory state
- a lien-theory state
- a title-theory state.
- an equitable-theory state
an intermediate mortgage theory state (page 281)
Which of these is legal in illinois?
- Offering finder’s fees to consumers
- giving referral fees to other licensees
- using a lottery to convey the property
- indicating a “standard commission” when asked
giving referral fees to other licensees (Part250 - 251)
Regarding security deposits, what difference is there between requirements for the landlord of a three-unit apartment building and the landlord of a 30-unit apartment?
Only the landlord of the 30-unit building is required to pay interest on security deposits (Page 325)
How many members on are the illinois real estate administration and disciplinary board?
9 (Page 249)
In illinois, how much written notice is a landlord required to give a tenant to pay overdue rent before terminating the lease, when the tenant is in default only for failing to pay rent on time?
5 days (Page 331)
In illinois, if a home rule county has an ordinance that conflicts with that of a home rule city, whos ordinance will prevail?
The city’s ordinance (Page 381)
A nonpossessory interest in real property is also called
an encumbrance (Page 123)
When a broker is representing her client, she is MOST likely acting as
A special agent
Which lien has priority in a foreclosure sale?
- Fire lien recorded
- mechanics or material men who file a timely notice after commencing work on the property
- Delinquent property taxes
- mortgagee or original lender
Delinquent property taxes (Page 172)
The individual appointed to the position of real estate coordinator…
- may not have held a real estate license in the past
- must surrender the real estate license for the duration of the appointment
- must hold an active real estate license
- must sign a statement that she will not pursue real estate activities that require a license during the appointment.
must surrender the real estate license for the duration of the appointment (Page 249)
What is the penalty if a person is convicted of practicing real estate without first obtaining a real estate license?
Up to $25,000 for each offense (Page 253)
A landlord sold an apartment building so that a freeway can be built. The tenant’s lease has expired, but the landlord permits him to stay in the apartment until the building is torn down. The tenant continues to pay the rent as prescribed in the lease. What kind of tenancy does the tenant have?
Tenancy at will (Page 322)
The owner of a house wants to fence the yard for her dog. When the fence is erected, the fencing materials are converted to real estate by…
Attachment (Page 18)
A man wants to sell his house as quickly as possible and believes that the best way to do this is to have several brokers compete against one another for the commission. The man’s listing agreements with four different brokers specifically promise that if one of them finds a buyer for his property, the man will be obligated to pay a commission to that broker. What type of agreement has the man entered into?
Redemption (Page 292)
A woman enters into a sale-leaseback agreement with a man, under which the man will become the owner of the woman’s ranch. Which of these statements is TRUE of this arrangement?
*The woman retains title to the ranch.
The man receives possession of the property.
*The man is the lessor
*the woman is the lessor
The man is the lessor (page 311)
An investor hires a real estate licensee to locate suitable properties for investment purposes. When the licensee finds a property that the investor might be interested in buying, she is careful to find out as much as possible about the property’s owners and why their property is on the market. The licensee’s efforts to keep the investor informed of all facts that could affect a transaction is the common-law duty of
Obedience (Page 37)
A parcel of vacant land 80 feet wide and 200 feet deep was sold for $200 feet per front foot. How much money would a broker receive for her 60% share in the 10% commission?
$960 (Page 78)
Which situation violates the federal fair housing act of 1968?
- The refusal of a property manager to rent an apartment to a catholic couple who is not otherwise qualified
- The general policy of a loan company to grant home improvement loans to qualified individuals living in transitional neighborhoods.
- A widowed woman’s insistence on renting her spare bedroom only to another widowed woman
- The intentional neglect of a broker to show an Asian family any property listing in all white neighborhoods
The intentional neglect of a broker to show an Asian family any property listing in all white neighborhoods (Page 402)
A seller sold a 2-acre parcel for $1.50 per square foot. What was the total sales price?
$130,680 (Page 160)
A condo was purchased for $1250,000. It appraised for $120,500 and previously sold for $118,250. Based on these facts, if the purchaser applies for 80% mortgage, what amount of the loan will the purchaser receive?
$96,400 (Page 306)
A buyer and a seller both sign a purchase contract. What kind of title interest, if any, does the buyer have in the property at this point?
Equitable (Page 213)
Which of these federal laws requires that finance charges be stated as an annual percentage rate?
Truth in Lending act (Page 313)
A seller signed a 90-day listing agreement with a sponsoring broker. Two weeks later, the seller was killed in an accident. What is the present status of the listing?
The listing agreement terminated automatically when the seller died (Page 109)
A woman conveys ownership of an office building to a nursing home. The nursing home agrees that the rental income will pay for the expenses of caring for the woman’s parents. When the woman’s parents die, ownership of the office building will revert to the woman. The estate held by the nursing home is a
Life estate pur autre vie (Page 121)
A purchaser signs a buyer’s brokerage agreement under which the licensee will help the purchaser find a three-bedroom house in the $285,000 to $300,000 price range. A seller comes into the licensee’s office and signs a listing agreement to sell the seller’s two-bedroom condominium for $170,000. Based on these facts, which of these statements is TRUE
- The purchaser is the licensee’s client; the seller is the licensee’s customer
- The purchaser is the licensee’s customer; the seller is the licensee’s client
- While both the purchaser and the seller are client,s the licensee owes the fiduciary duties of an agent only to the seller.
- Because both the purchaser and the seller are the licensee’s clients, the licensee owes the fiduciary duties of an agent to both
Because both the purchaser and the seller are the licensee’s clients, the licensee owes the fiduciary duties of an agent to both (Page 34)
In a township of 36 sections, which of these statements is TRUE
- Section 31 lies to the east of section 32
- Section 18 is by law set aside for school purposes
- section 6 lies in the northeast corner of the township
- Section 16 lies to the north of section 21
Section 16 lies to the north of section 21 (Page 159)
A lawyer represented the seller in a transaction. Her client informed her that he did not want to recite the actual consideration that was paid for the house. Based on these instructions, the lawyer
- Must inform her client that only the actual price of the real estate may appear on the deed
- May prepare a deed that shows only nominal consideration of $10
- Should inform the seller that either the full price should be stated in the deed or all references to consideration should be removed from it
- May show a price on the deed other than the actual price, provided that the variance is not greater than 10% of the purchase price
May prepare a deed that shows only nominal consideration of $10 (Page 222)
A sponsoring broker obtained a listing agreement to act as the listing agent in the sale of the client’s home. When a buyer was found for the property, all agreements were signed. As a n agent for the seller, the sponsoring broker is responsible for
- Completing the buyer’s loan application.
- Making sure that the buyer receives copies of all documents the seller is required to deliver to the buyer.
- ensuring that the buyer is qualified for the new mortgage loan
- scheduling the buyer’s inspection of the property
Making sure that the buyer receives copies of all documents the seller is required to deliver to the buyer. (Page 37)
What is a real estate broker’s share of the commission when the sales price of a property is $195,000 and the broker is entitled to 65% of the 7.5% commission?
$9,506.25 (Page 78)
If an appraiser is estimating the value of a property using the cost approach, which of these describes what the appraiser should do?
- Estimate the replacement cost of the improvements
- Deduct the depreciation of the land and buildings
- Determine the original cost and adjust for depreciation
- review the sales prices of comparable properties
Estimate the replacement cost of the improvements (Page 362)
Three business days before the closing of a real estate loan transaction, a mortgage loan originator must provide the borrower with the Closing Disclosure (CD). This disclosure is in keeping with which of the following?
- Equal Credit Opportunity Act (ECOA)
- Truth in Lending Act
- TRID
- Fair Housing Act
TRID (Page 443)
A man conveys a life estate to his siter. Under teh terms of the mans’ conveyance, the property will pass to his neice upon his siter’s death. Which of these BEST describes the niece’s interest in the property during the sister’s lifetime?
- Remainder
- Reversion
- Life estate pur autre vie
- Redemption
Remainder (Page 121)
On a settlement statement ,prorations for real estate taxes paid in arrears are shown as a
- credit to the seller and a debit to the buyer
- Debit to the seller and a credit to the buyer.
- credit to both the seller and the buyer
- debit to both the seller and the buyer
Debit to the seller and a credit to the buyer. (Page 454)
What type of lease establishes a rental payment and requires that the lessor pay for the taxes, insurance, and maintenance on the property?
Net (Page 329)
A conventional loan was closed on July 1 for $57,200 at 13.5% interest amortized over 25 years at $666.75 per month.. On september 1, what would the principal mount be after the monthly payment was made?
$57,176.75 (Page 303)
A conventional loan was closed on July 1 for $57,200 at 13.5% interest amortized over 25 years at $666.75 per month.. On september 1, what would the interest portion of the payment be?
$643.50 (Page 303)
When a seller listed her home with a broker for $190,000, the seller told the broker, “I have to sell quickly because of a job transfer. If necessary, I can accept a price as low as $175,000.” The broker then told a prospective buyer to offer $180,000 “because the seller is desperate to sell the buyer’s offer. Based on these facts, the broker
- Did not violate his agency relationship with the seller because the broker did not reveal the seller’s lowest acceptable price.
- violated his agency relationship with the seller.
- Acted properly to obtain a quick offer on the seller’s property, in accordance with the sellers instructions.
- violated his duties toward the buyer by failing to disclose that the seller would accept a lower price than the buyer offered.
violated his agency relationship with the seller. (Page 36)
Which of these BEST describes the capitalization rate under the income approach to estimate the value of real estate?
- Rate at which a property increases in value
- Rate of return a property earns as an investment
- Rate of capital required to keep a property operating most efficiently
- Maximum rate of return allowed by law on an investment
Rate of return a property earns as an investment (Page 366)
On a settlement statement, the cost of the lender’s title insurance policy required for a new loan is usually shown as what?
Debit to the buyer (Page 454)
an FHA-insured loan for $57,500 at %8.5 for 30 years was closed in July 17,2013. The first monthly payment is due on September 1. Because interest is paid monthly in arrears, what was the amount of the interest adjustment the buyer owes at the settlement, using the statutory method?
$190.07 (Page 1457-458)
A seller received an opinion of value from his listing agent of $255,000 for his property. He sold the property for $249,000. Which of the following is TRUE
- $255,000 is the market price
- $249,000 is the market price
- $249,000 is the market value
- The market value cannot be determined
$249,000 is the market value (Page 359)
A woman has a contract to paint her brother’s garage door for $1200. Before starting the project, the woman has a skiing accident and breaks both arms. She asks a friend to take over the job. The friend paints the brother’s garage door and the brother pays the friend $1200 for the work. This scenario is an example of
assignment (Page 193)
When searching the public record regarding title to a specific property, what is the researcher MOST likely to find
Judgments (Page 237)
A rectangular lot is worth $193,600. This value is the equivalent of $4.40 per square foot. If one lot dimension is 200 feet, what is the other dimension?
220 feet (Page 75)
A sponsoring broker listed a seller’s property an 8% commission rate. After the property was sold and the settlement had taken place, the seller discovered that the broker had been listing similar properties at 6% commission rates. Based on this information alone, which of these statements is true?
- The broker has done nothing wrong because a commission rate is always negotiable between the parties
- If the broker inflated the usual commission rate for the area, the broker may be subject to discipline by the state real estate commission
- The seller is entitled to rescind the transaction based on the principle of lack of reality of consent
- the seller is entitled to a refund from the broker of 2% of the commission
The broker has done nothing wrong because a commission rate is always negotiable between the parties (Page 75)
A woman has six months remaining on her aprartment lease. Her monthly rent is $1,875. The woman moves out of the apartment, and her friend moves in. The friend pays the woman a monthly rental of $1,700, and the woman continues paying the full rental amount under her lease to the landlord. When the womann’s lease term expires, her friend will either move out or sign a new lease with the landlord. This is an example of
*subletting (page 327 - 328)
One broker asked another, “will i have to prove that i was the procuring cause if my seller sells the property himself?” The other broker answers, “No, not if you have a(n)…
exclusive-right-to-sell listing (Page 88)
The capitalization rate on a property reflects which of these factors?
- risk of the investment
- replacement cost of the improvements
- Real estate taxes
- Debt service
risk of the investment (Page 366)
A woman just learned that the city would like to tear down three homes across the street and build a new multi-unit apartment building in their place. She wants to sell her home now, before the value decreases. This is an example of
anticipation (Page 360)
A person who dies without having made a will is said to be
Intestate (Page 231)
A farmer owns the W1/4 of the NW1/4 of the NW1/4 of Section 22. The remainder of the large NW1/4 can be purchased for $300 per acre. Owning the remainder of the NW1/4 of Section 22 would cost the farmer
$42,000 (Page 161)
In a standard sales contract, several words were crossed out or inserted by the parties. To eliminate future controversy as to whether the changes were made before or after the contract was signed, the usual procedure is to what?
Have both parties initial or sign in the margin near each change (page 195)
The manager of an apartment building receives an 8 1/2% commission for each new tenant that he signs, based on the unit’s annualized rent. In one year, the manager signed five new tenants. Three of the apartments rented for $795 per month; one rented for $900 per month; and one rented for $1200 per month. What was the total amount of the manager’s new tenant commissions for that year?
$4,574 (Page 343)
The monthly rent on a warehouse is $1.85 per square foot. Assuming the warehouse is 36 feet by 200 feet, what is the annual rent?
$13,320 (Page 466)
A veteran wishes to refinance his home with a VA-guaranteed loan. The lender is willing but insists on 3 1/2 discount points. In this situation what can the veteran do?
Proceed with the refinance loan and pay the discount points (Page 309)
A father owns two properties. He conveys one property to his daughter with no restrictions; the daughter holds all rights to this property forever. The man then conveys the second property to his son “so long as no real estate licensee ever sets foot on the property.” If a licensee visits the second property, ownership will revert to the father. Based on these two conveyances, which of these statements is TRUE?
- The daughter holds the first property in fee simple; the son holds the second property in fee simple determinable
- The daughter holds the first property in fee absolute; the son holds the second property in fee simple defeasible, subject to a condition subsequent.
- The son may not transfer ownership of the second property without his father’s permission.
- The father has retained a right o reentry regarding the second property.
The daughter holds the first property in fee simple; the son holds the second property in fee simple determinable (Page 118-120)
A real estate transaction had a closing date of november 15. The seller, who was responsible for costs up and including the date of settlement, paid the property taxes of $1,116 for the calendar year. On the closing statement, the buyer would be debited/credited how much?
debited $139.50 (Page 454)
An agreement that ends all future lessor lessee obligations under a lease is called what
A surrender (Page 331)
A man buys a house for $234,500. He makes a $25,000 cash down payment and takes out a $209,500 mortgage for 30 years. The lot value is $80,000. If the man wants to depreciate the property over a period of 27 1/2 years, how much will the annual depreciate amount be, using the straight-line method?
$5,618.18 (Page 364)
A property manager leased a store for three years. The first year, the store’s rent was $1,000 a month, and the rent was to increase 10% per year thereafter. The manager received a 7% commission for the first year, 5% for the second year, and 3% for the balance o the lease. The total commission earned by the property manager was
$1,936 (Page 343)
Against a recorded deed from the owner of record, the party with the weakest position is
- person with a prior unrecorded deed who is not in possession
- Person in possession with a prior unrecorded deed
- Tenant in possession with nine months remaining on the lease
- Painter who is half-finished painting the house at the time of the sale and who has not yet been paid.
person with a prior unrecorded deed who is not in possession (Page 240-241)
An individual bought a home in 2014 for $346,000. Three years later, he sold the home for $374,800 and moved into an apartment, what amount of this transaction is taxable?
None of it (Page 326)
A man moved into an abandoned home and installed new cabinets in the kitchen. When the owner discovered the occupancy, the owner had the man ejected. What is the status of the kitchen cabinets?
The man has no right to the cabinets (Page 326)
A man, his nephew, and his niece are joint tenants. The man sells his interest to his sister, and then his nephew dies. As a result, which of these statements is true?
- The nephew’s heirs are joint tenants with the man and his sister
- The nephew’s heirs and the man are joint tenants, but the sister is a tenant in common
- The man is a tenant in common with his sister’s and nephew’s heirs
- The man’s niece and the man’s sister are tenants in common
The man’s niece and the man’s sister are tenants in common (Page 137-138)
In a settlement statement, the selling price is ALWAYS
- A debit to the buyer
- A debit to the seller
- a credit to the buyer
- greater than the loan amount
a debit to the buyer (Page 454)
The state wants to acquire a strip of farmland to build a highway. Does the state have the right to acquire privately owned land for public use?
Yes; the state’s right is called eminent domain (page 116)
A woman’s estate was distributed according to her will as follows: 54% to her husband, 18% to her children, 16% to her grandchildren, and the remainder to her college. The college received $79,000. How much did the woman’s children receive?
$118,500
Which of these is an example of external obsolescence?
- Numerous pillars supporting the ceiling in a store
- Leaks in the roof of the warehouse, making the premises unusable and therefore unrentable
- Coal cellar in a house with central heating
- Vacant, abandoned, and run down buildings in an area
Vacant, abandoned, and run down buildings in an area (Page 116)
Which of these phrases, when placed in a print advertisement, would comply with the requirements of the Truth in Lending act?
- “12% interest”
- “12% rate”
- “12% annual interest”
- “12% annual interest rate”
“12% annual interest rate” (Page 313)
If an office building lease does not prohibit assignment or subletting, under what conditions, if any, may the tenant assigns the space?
- Only to an associated corporation
- Only with any rent increase being split with the owner
- After hiring legal counsel to obtain full rights to the lease
- Freely
Freely (Page 327)
The equal credit opportunity act makes it illegal for lenders to refuse credit to or otherwise discriminate against
- a parent of twins who receives public assistance and who cannot afford the monthly mortgage payments
- a new home buyer who does not have a favorable credit history
- A single person who receives public assistance
- an unemployed person with no job prospects and no identifiable source of income
A single person who receives public assistance (Page 313-314)
When a woman died, a deed was found in her desk drawer. While the deed had never been recorded, it was signed, dated, and acknowledged. The deed gave the woman’s house to a local charity. The woman’s will, however provided as follows: “I leave all of the real and personal property that I own to my beloved nephew.” In this situation, the house MOST likely will go to the
- Charity because acknowledgment creates a presumption of delivery
- Charity because the woman’s intent was clear from the deed.
- Nephew because the woman still owned the house when she died
- Nephew because the deed had not been recorded
Nephew because the woman still owned the house when she died (Page 224)
If a woman takes out a $90,000 loan at 7 1/2% interest to be repaid at the end of 15 years with interest only paid annually, what is the total interest that the woman will pay over the life of the loan?
$101,250 (Page 303)
Jason, a listing agent, is sitting an open house for his client. Jessica enters the open house and likes it. She begins to ask questions about how much she should offer and her best negotiation tactics. Jason is happy to answer all of her questions. In this situation, which of the following is TRUE?
- Jason is acting as an undisclosed dual agent
- as long as Jason has given jessica a Disclosure of No Agency, he should be fine
- Since Jessica verbally said she’d like help, Jason should answer all her questions.
- Jason should do what’s necessary to make the deal happen
Jason is acting as an undisclosed dual agent (Page 52)
To net the owner $90,000 after 6% commission is paid, the selling price would have to be what?
$95,745 (Page 94)
Which of these would MOST likely be legal under the provisions of the Civil Rights Act of 1968?
- A lender refuses to make loans in areas which more than 25% of the population is Hispanic
- A private country club development ties home ownership to club membership, but due to local demographics, all club members are white.
- A church excludes African Americans from membership and rents tits nonprofit housing to church members only
- A licensee directs prospective buyers away from areas they are likely to feel uncomfortable because of their race
A private country club development ties home ownership to club membership, but due to local demographics, all club members are white. (page 399)
It is discovered after a sale that the purchased land parcel is 10% smaller than the owner represented it to be. The broker who transmitted the information concerning size of the parcel to the buyer is… (liable/not liable and why)
Not liable if the misrepresentation was unintentional (Page 264)
On a residential lot 70 feet square, the side yard building setbacks are 10 feet, the front yard setback is 25 feet, and the rear yard setback is 20 feet. The maximum possible size for a single story structure is how many square feet?
1,250 (Page 465)
Which of the following is a purpose of the Real Estate Settlement procedures Act (RESPA)?
- To ensure that there have been no hidden payments between service providers
- To make real estate brokers more responsive to buyers’ needs
- To require use of a particular title insurance company
- To allow lenders to charge for services that were not performed
To ensure that there have been no hidden payments between service providers (Page 441)
Which of the following is a purpose of the Real Estate Settlement Procedures Act (RESPA)?
- To ensure that there have been no hidden payments between service providers
- To make real estate brokers more responsive to buyers’ needs
- To require use of a particular title insurance company
- To allow leaders to charge for services that were not performed
To ensure that there have been no hidden payments between service providers (Page 441)
The rescission provisions of of the Truth in lending act apply to which transactions?
- Agricultural loans
- Construction lending
- business financing
- consumer credit
Consumer credit (Page 312)
A property has a new income of $30,000. An appraiser decides to use a 12% capitalization rate rather than 10% rate on this property. What is the result of using the higher capitalization rate?
$50,000 increase in the appraised value (Page 366)
The section of a purchase contract that provides for the buyer to forfeit any earnest money if the buyer fails to complete the purchase is called the provision for…
Liquidated damages (Page 198)
In one commercial building, the tenant intends to start a health food shop using her life savings. In an identical adjacent building is a showroom leased to a major national retailing chain. Both tenants have long term leases with identical rents. Which of these statements is TRUE?
- If the values of the buildings were the same before the leases, the values will be the same after the leases
- An appraiser would most likely use a higher capitalization rate for the store leasing to the national retailing chain.
- The most accurate appraisal method an appraiser could use would be the sales comparison approach to value
- The building with the health food shop will probably appraise for less than the other building
The building with the health food shop will probably appraise for less than the other building (Page 345 - 346)
A builder wants to offer financial assistance to prospective buyers but does not want to lower the price of the homes. Instead the builder agrees to pay a lump sum in cash to the lender at closing so that the buyers will enjoy a lower interest rate. What type of loan is this?
Buydown (Page 311)
A $100,000 loan at 12% could be amortized with monthly payments of $1,200.22 on a 15 year basis or payments of $1,028.63 on a 30 year basis. The 30 year loan results in total payments of what percentage of the 15 year loan’s total payments?
171% (page 303)
According to a broker’s comparative market analysis (CMA), a property is worth $125,000. The homeowner bought the property for $90,000 and added $50,000 in improvements, for a total of $140,000. The property sold for $122,500. Which of these amounts represents the property’s market price?
$122,500 (page 358)
What will the amount of tax payable where the property’s assessed value is $85,000 and the tax rate is 4% in a community in which an equalization factor of 110% is used?
$3,740.00 (Page 175)
In a settlement statement, how will a proration of prepaid water, gas, and electric charges be reflected?
Debit to the buyer and a credit to the seller (Page 454)
An apartment manager decides not to purchase flood insurance. Instead, the manager installs raised platforms in the basement storage areas and has the furnace placed on eight inch legs. This form of risk management is called
Controlling the risk (Page 349)
A real estate broker was responsible for a chain of events that resulted in the sale of one of his client’s properties. The broker is legally called the….
Procuring cause (Page 76)
A characteristic of real estate licensees who are independent contractors is that hey commonly receive…
- More than 50% of income in the form of a monthly salary or hourly wage
- Company provided health insurance and other benefits
- reimbursement for documented travel and business expenses
- more than 90% of the income based on sales production
more than 90% of the income based on sales production (Page 64)
In the cost approach to value, the appraiser makes use of the
- Owners original cost of the building
- estimated current replacement cost of the building
- sales prices of similar buildings in the area
- Assessed value of the building
Estimated current replacement cost of the building (Page 362)
A buyer enters into an exclusive agency buyer agency agreement with a real estate broker. Based on these facts, which of these statements is TRUE
- The buyer is obligated to pay the broker’s compensation regardless of who finds a suitable property
- If the buyer finds a suitable property without the broker’s assistance, she is under no obligation to pay the broker
- The buyer may enter into other, similar agreements with other brokers.
- If the buyer finds a suitable property without the broker’s assistance, the buyer will have to pay the broker’s compensation
If the buyer finds a suitable property without the broker’s assistance, she is under no obligation to pay the broker (Page 103)
Which of these is TRUE of comparative market analysis (CMA)?
- A CMA is the same as an appraisal
- a sponsoring broker, not an affiliate, is permitted to prepare a CMA
- A certified real estate appraiser prepares a CMA
- A CMA contains a compilation of other similar properties that have sold
A CMA contains a compilation of other similar properties that have sold (Page 91-92)
An owner sells his fourplex. Regarding this situation, which of these is TRUE
- The tenants may void their leases
- The lender may void the leases
- The current leases must be honored by the new landlord
- The current leases may be discharged by the previous landlord
The current leases must be honored by the new landlord (Page 331)
When appraising a single family home, and appraiser considers which of these in determining the value of the property
- Racial demographics
- Date sold
- Properties located within a 10 mile radius
- Pending property sales
Date sold (Page 360-361)
One general rule of the federal do not call regulations is that…
- States must maintain separate do no call list
- The national registry must be searched one a year
- It is illegal to make an unsolicited phone call to a number listed on the national registry.
It is illegal to make an unsolicited phone call to a number listed on the national registry. (Page 79-80)
Federal regulations on unsolicited email
- require commercial emails to include a physical address for the sender
- Require prior permission of recipients in order to send email to them
- Require that email lists be scrubbed every 31 days.
- Exempt phone calls to individuals with whom the office has a prior business relationship
It is illegal to make an unsolicited phone call to a number listed on the national registry. (page 80-81)
A transaction is closing on May 2 in a non-leap year. What is the proration of an annual charge of $560, using the statutory variation method?
$189.68 (Page 457)
Under illinois law, what is the statutory ceiling on the prepayment penalty a lender may charge on loans secured by real estate that bear more than 8% annual interest?
None (Page 283)
A tenant agrees to rent an apartment for nine months under a verbal agreement with the land lord. If the tenant defaults, what may the landlord do?
Bring a court action because on year leases need not be in writing to be enforced. (Page 320)
What principle of landlord tenant relations was established by the Illinois supreme court in 1972?
Implied warranty or habitability in residential tenancies (Page 327)
In illinois, if a landlord purposely fails to maintain an apartment building’s furnace and plumbing, what option is available to a tenant whos apartment is without heat and water during the first three months of winter?
Suit for constructive eviction (Page 332)
A woman pays $1,250 per month for her apartment. If she refers three new tenants to the building’s owner during the year, how much is she entitled to receive under the Real Estate License Act of 2000 if the landlord’s normal referal fee is $500 per new tenant?
$1,250 (Page 252)
Which of these properties are exempt from pay real estate taxes?
- Apartment complexes
- Industrial parks
- Shopping centers
- Educational institutions
Educational institutions (Page 173)
Which of these is TRUE pursuant to the illinois human rights act?
- It is a civil rights violation to require, as a condition to the rental of an apartment, that the prospective tenant not have any children under 18 residing in her family at the time the rental application is made
- It is legal to refuse to rent to a tenant because she has a service animal.
- It is legal to refuse to sell to a prospective purchaser because she has a service animal.
- It is legal to refuse to rent to a blind person if the landlord states safety concerns as the rationale for the refusal
It is a civil rights violation to require, as a condition to the rental of an apartment, that the prospective tenant not have any children under 18 residing in her family at the time the rental application is made (Page 405)
The illinois Human Rights Act specifically exempts
- Gender based discrimination in housing intended for multigender occupancy
- religious organizations giving preference in housing to non members
- A five unit apartment building with a resident property manager living on one of the units
- A three unit apartment building with the owner living in one of the units
A three unit apartment building with the owner living in one of the units (Page 405)
Many of the residents of the landlord’s apartment building are elderly, and some are in poor health. To ensure that they are not disturbed, the landlord politely declines to rent units to families or individuals who have young children. However, the landlord provides such persons with a printed list of nearby apartment buildings that welcome children. Based on these facts, which of these statements is TRUE
- By providing a printed list of alternative comparable housing, the landlord is in full compliance with the illinois human rights act
- Because the landlord’s primary intent is to protect existing tenants’ quality of life, and not to discriminate against prospective tenants who have young children, the illinois human rights act does not apply to this situation.
- The landlords policy violates the illinois human rights act
- While the landlrod’s policy, as stated violates the illinois Human Rights Act, he could add a “no children” provision to leases offered to new tenants and avoid violating the act
The landlords policy violates the illinois human rights act (Page 404)
What is the relationship between the illinois agency statutes and the common law of agency?
Illinois agency statues supersede the common law of agency in illinois (Page 33)
Which of these is an example of a ministerial act under the illinois agency law?
- Arguing the merits of an offer on behalf of a prospective buyer
- helping prospective buyers determine an appropriate price range and geographic location for their home search
- Responding to general questions about the price and location of a specific property
- Assisting a buyer through he closing process
Responding to general questions about the price and location of a specific property (Page 55)
A real estate sponsoring broker commonly names individual sponsored licensees in her brokerage office as the exclusive agents of certain clients, leaving the other sponsored licensees free to represent other parties in a transaction. Which of these statements is TRUE regarding this practice?
- Because it is a common office practice, it is permitted as an exception to the general statutory prohibition against such arrangements.
- illinois agency law specifically permits designated agency arrangements such as this
- This is an example of designated agency, which is an illegal relationship under illinois agency law
- The sponsoring broker will be considered an undisclosed dual agent under these facts and will be in violation of illinois law
illinois agency law specifically permits designated agency arrangements such as this (Page 48)
A sponsoring broker decides to “sweeten” an MLS listing for a property by making a blanket offer of sub agency. Is the sponsoring broker’s action acceptable?
No because sub agency relationships may not be offered through an MLS in illinois (Page 264)
A broker represents the seller in a transaction. When prospective buyers ask to look at the property, the broker must do what?
Clearly disclose in writing that the broker represents teh seller’s interests (Page 94)
Several years ago, a unity in a condominium community was the site of a brutal and highly publicized murder. The unit was sold to an elderly woman who contracted the AIDS virus in a blood transfusion and died in the unity last year. What are the disclosure responsibilities to prospective purchasers of this unit?
Agents are specifically prohibited by federal law from disclosing AIDS (Page 265)
In illinois, an unlicensed real estate assistant may do what?
Prepare and distribute flyers and promotional materials (Page 73)
Illegal discrimination might result in which of these actions?
- Loss of license
- unlimited civil fines by the Department
- Reduced errors and omissions insurance premiums
- None of these
Loss of license (Page 73)
An unlicensed assistant worked late nights and weekends to help ensure the successful closing of a difficult transaction. At the licensee’s direction, the assistant’s extra work included making several phone calls to the prospective buyers, encouraging them to accept the seller’s counter offer. Largely because of the assistant’s efforts, the sale went through with no problem. The licensee wants to pay the assistant a percentage of the commission. “Because the assistant has really earned it.” Under Illinois license law, what should the licensee do?
The licensee should pay no commission to the assistant. The licensee’s direction and the assistant’s work violated illinois law. Payment of commission would also violate the law (Page 250-251)
A buyer wants to have a clause included in the sales contract under which the seller offers assurances that no one has died in the home. Which of these is TRUE in illinois?
- The licensee may include the clause because such standard disclosures are in general usage
- Only the buyer or a licensed attorney may prepare the clause for inclusion in the sales contract
- In illinois, licensees are permitted to add additional clauses to blank form contracts, such as the clause described here, that do not directly involve the conveyance of title to real property
- Under illinois law, a clause such as the one described here is not permitted and any contract containing such a clause will be void
Under illinois law, a clause such as the one described here is not permitted and any contract containing such a clause will be void (Page 44)
A broker lists the seller’s home. Under the terms of the agreement, when the property sells, ht seller will receive a guaranteed $75,000. Any amount left over after the seller’s $75,000 will constitute the broker’s compensation. Based these facts, which of these statements is TRUE in illinois.
- This type of arrangement, called a guaranteed sales agreement, is illegal in illinois, and the broker will be disciplined for entering into it
- This type of arrangement, called a net listing, is illegal in illinois, and the broker will be disciplined for entering into it.
- This is an example of a guaranteed sales agreement, which is permissible in illinois if the broker provides the seller with the necessary disclosures.
- This is an example of a net listing, which is discouraged (But not illegal) in illinois.
This is an example of a net listing, which is discouraged (But not illegal) in illinois. (Page 89)
In illinois, which of these in a listing agreement would result in the suspension or revocation of a licensee’s license to practice real estate?
- A specified commission rate
- No specific termination date
- No broker protection clause
- A specific termination date
No specific termination date (Page 47)
Under illinois law, which disclosure must be included in an exclusive listing agreement.
- Anticipated seller closing costs
- Tax identification number
- Seller’s net return
- Minimum services language
Minimum services language (Page 89)
A married couple lives in Springfield, Illinois. The wife is the owner of their home. If the couple decides to sell their home and move to Wisconsin, who is required to sign the listing agreement?
Both the husband and the wife must sign the listing. (Page 123)
From what source do illinois local units of government receive their powers of eminent domain?
The illinois Constitution and Code of Civil Procedure (Page 117)
A person dies without leaving a will. If the deceased owns real property in Illinois and has no heirs, what will happen to her real property.
The deceased’s property will escheat to the county in which it is located (Page 118)
Is there any limitation on an original grantor’s right of reverter in illinois?
Yes, the original grantor’s right of reverter continues for 40 years; although the underlying condition remains enforceable. (Page 120)
Which of these is available to a surviving spouse in illinois?
- Homestead
- Dower
- Curtesy
- A married easement
Homestead (Page 122)
How much of an estate of homestead is an individual entitled to in illinois?
$15,000 (page 123)
Which of these conducts is cause for discipline under the real estate license act of 2000?
- Using misleading or untruthful advertising
- Violating the Illinois Human Rights Act
- Encouraging homeowners to sell when minorities move into the neighborhood
- All of these
All of these (269 - 27)
Real property location in illinois are described by their geographic relation to
The second, third, and fourth principal meridians (Page 157)
How often is the assessed valuation of all real estate in illinois adjusted by county authorities?
Annually (Page 175)
An illinois resident was born on March 6, 2011. When will this person become of legal age?
March 6, 2029
If a minor enters into a contract in illinois, what is the statutory period within which the minor may legally void the contract after reaching the age of majority?
There is no statutory period (Page 192)
Which of these is essential to the validity of a deed in illinois?
- A seal (or the word seal)
- Acknowledgment
- Granting clause
- Recording
Granting Clause (Page 221)
In illinois, the amount of consideration used to determine transfer taxes must be shown on the
- Recording Form
- Real Estate Declaration of Transfer
- Blue Sheet
- Tax Code Sheet
Real Estate Declaration of Transfer (Page 228)
How far back does a normal illinois title search go?
40 years (Page 241)
Which of these are exempt from the provisions of the Real Estate License Act of 2000?
- Property owners who sell or lease property on behalf of others because they are familiar with the process
- Individual who is employed as a resident property manager
- Individual who engages in fee based management services
- Resident lessee who receives the equivalent of $2,000 as “finder’s fee” for referring a new tenant to the owner
Individual who is employed as a resident property manager (Page 251)
Which of these is a requirement for obtaining an illinois broker’s license?
- Having successfully completed 45 hours of approved real estate courses
- Being at least 17 years of age
- Being of good moral character
- Having been actively engaged as a licensed broker for at least 5 years
Being of good moral character (Page 254)
A person who successfully completed her illinois real estate education requirement on november 1, 2014 make take the license exam no later than when?
October 31, 2018 (Page 253)
What is the expiration date of every broker’s license in illinois?
April 30 of each even-numbered year (Page 259)
An illinois sponsoring broker wants to open a branch office in a neighboring town. The sponsoring broker applies for a branch office license and gives the branch a name that clearly identities its relationship with his main office. The sponsoring broker names a licensed illinois leasing agent, as the branch office manager. In this situation, will the sponsoring broker receive approval for the branch office?
No; the manager of a branch office must hold a managing broker’s license (Page 262)
A licensee could tell that a prospective buyer would probably not make an offer if she knew the previous occupant of a property had died from complications related to AIDS and did not disclose that fact. An illinois real estate broker set up a “micro brokerage.” real estate services outlet in a convenience store by placing a desk at the end of a snack food aisle. A managing broker waited outside an AMP testing facility and handed out brochures to prospective licensees on their way in to take the real estate exam, encouraging them to apply for a job at his office. Which, if any, of these individuals is subject to disciplinary action for violating the Real Estate License Act of 2000?
Only the two brokers (Page 262, 265)
Which of these is grounds for disciplinary action?
- Being convicted of a felony in illinois
- advertising in a magazine that the broker is a member of the Chicago Association of REALTORS when the broker is not
- Depositing escrow money into a personal account
- All of the above
All of the above (Page 269-270)
A licensee engaged in activities that constitute violations of the Illinois human Rights Act, including blockbusting and discrimination on the basis of disability. The licensee also cashed a $25,000 earnest money check from a prospective buyer and used the proceeds to buy a new car. Despite rigorous management and oversight, the licensee’s sponsoring broker was completely unaware of all of these activities. When the licensee’s violations are brought to IDFPRS’s attention, which of these statements is TRUE?
- The sponsoring broker will probably not have his license revoked as a result of the licensee’s violations
- The licensee’s sponsoring broker will be required to pay any fine imposed against the licensee out of his own personal funds. The licensee’s violations are legally the responsibility of the sponsoring broker, who will be subject to the same disciplinary action as the licensee, regardless of whether he knew the violations had occurred
- The licensee’s sponsoring broker will be held liable for the Human Rights Act violations only
The sponsoring broker will probably not have his license revoked as a result of the licensee’s violations (Page 271)
A broker is convicted of a crime involving fraud in Wisconsin on November 9. On February 1 of the following year, the Wisconsin licensing agency notifies IDFPR of the conviction. Based on this information, which of these is TRUE?
- The broker should have called IDFPR first
- IDFPR may refuse to renew the broker’s license based on his Wisconsin conviction for a crime involving fraud
- Because the conviction was not in illinois, no discipline will occur
- A conviction due to fraud does not constitute a violation of the Real Estate License Act of 2000
IDFPR may refuse to renew the broker’s license based on his Wisconsin conviction for a crime involving fraud (Page 269)
Which of these accurately describes the review process for a final administrative decision of IDFPR?
- The accused may appeal a final administrative decision of IDFPR directly to the illinois Supreme Court.
- The accused may petition the circuit court of the county in which the accused resides. The circuit court’s decision may be appealed directly to the illinois Supreme Court
- The accused may petition the circuit court of the county in which the accused resides. The circuit court’s decision may be appealed directly to the illinois supreme court
- The accused may petition the circuit court of the county in which the property involved in the transaction that gave rise to the violation is located. The circuit court’s decision may be appealed directly to the federal district court
- The accused may request a rehearing by IDFPR, but administrative decision may not be appealed to any court
The accused may petition the circuit court of the county in which the accused resides. The circuit court’s decision may be appealed directly to the illinois Supreme Court (Page 273)
Which of these is required to adopt a company policy manual?
- Sole proprietorship with no other sponsored licensees
- Self sponsored broker with no sponsored licensees
- Brokerage company with sponsored licensees
- None of these
Brokerage company with sponsored licensees (page 67)
Every Illinois broker who applies for renewal of a license must successfully complete how many hours of continuing education courses in each two year license renewal period?
12 (Page 260)
Regarding mortgage theory, illinois is usually described as
An intermediate mortgage-theory state (Page 282)
Twenty years ago, a man obtained a 30-year mortgage loan to purchase a home. The interest rate on the loan was 9.275%. Today, the man is prepared to pay off the loan early. Based on these facts, which of these statements is TRUE in illinois?
- The man’s lender is entitled by statute to charge the man a prepayment penalty equal to one year’s interest on the current balance of the loan.
- The man’s lender is permitted by illinois statute to charge the man a prepayment penalty of no more than 8% of the current outstanding balance of the loan.
- Illinois does not take an official statutory position on the issue of prepayment penalties
- Because the man’s interest rate is greater than 8%, the lender may not charge a prepayment penalty under illinois law
Because the man’s interest rate is greater than 8%, the lender may not charge a prepayment penalty under illinois law (Page 284)
In illinois if a landlord wants to terminate a year to year tenancy, how much notice must the tenant receive?
60 days (Page 332)
In illinois, which of these is TRUE of an individual who wishes to engage only in the leasing of residential real property?
- The individual must obtain a broker’s license and be employed by a broker who specializes in residential lease
- The individual may obtain a certified leasing agent designation by passing a test
- The individual may obtain a limited leasing agent license by completing 15 hours of instruction and passing a written examination
- The individual may engage in residential leasing activities without obtaining a license or other certification
The individual may obtain a certified leasing agent designation by passing a test (Page 255)
In illinois, which of these must be disclosed?
- Stigmatized property
- Dual agency
- Registered sex offenders
- Single Agency
Dual agency (Page 52)
If an annual charge of $560 is prorated in October using the statutory variation method, what will be the resulting daily charge?
$1.51 (Page 457)
In illinois, the closing statement is customarily prepared by who?
Seller’s attorney (Page 437)
Zoning ordinances may regulate
- Water usage
- Deed restrictions
- Restrictive covenants
- Density
Density (Page 382)
Which of these is TRUE regarding option contracts?
- An option contract is classified as a unilateral contract
- An option contract that has been exercised is classified as a bilateral contract
- The option money may not be applied toward the purchase price
- The seller is the optionee, and the buyer is the optionor.
An option contract is classified as a unilateral contract (Page 214)
Grounds for discipline under the Real Estate License Act of 2000 include
- Disclosing dual agency
- Representing a broker other than the sponsoring broker
- Advertising the sponsoring broker’s name in the advertisement
- maintaining an escrow account to hold earnest money deposits
Representing a broker other than the sponsoring broker (page 269 - 270)
Which of these will terminate a listing contract?
- Only the seller agreeing to cancel because it is unilateral decision of the client
- The foreclosure of the neirhbor’s property will terminate the contract
- The death of the sponsoring broker will terminate the contract
- There is no cancellation provision in listing contracts
The death of the sponsoring broker will terminate the contract (Page 109)
Under the Real Estate License Act of 2000, which of these could work in a limited way indefinitely without a specific license?
- Personal assistance hired by a sponsored broker
- Leasing agent hired by a property management company
- Leasing agent working independently
- Broker working independently
Personal assistance hired by a sponsored broker (Page 72-73)
The number of hours of continuing education that can be taken in one day…
- is not regulated by law
- Cannot be more than six hours
- Cannot be more than nine hours
- Cannot be more than nine hours
- Can be up to 12 hours
Cannot be more than nine hours (page 261)
Why is early discussion of agency so important under the Real Estate License Act of 2000?
Working with a consumer may now be construed as an implied agency if nothing else has been stated (Page 46)
prelicense courses will have to be retaken if a license has been expired for more than
2 years (Page 258)
Under the real estate license act of 2000, a buyer to whom a license is showing houses under a buyer brokerage agreement is considered to be….
A client (Page 34)
Which of these statements could an illinois buyers agent appropriately make to a buyer client?
- “Here are the CMAs. I think they suggest the highest range you should pay is about $110,000 - 120,000, but that’s up to you.”
- “The listing agent said the floors underneath the carpet are oak. Isn’t that great.”
- “I know this neighborhood. Don’t worry about radon.”
- There really isn’t any way to get a list of released sex offenders addressed in illinois.”
“Here are the CMAs. I think they suggest the highest range you should pay is about $110,000 - 120,000, but that’s up to you.” (Page 104)
Employment agreements with a sponsoring broker must cover at LEAST
- Supervision, duties, referral fees, and MLS requirements
- Referral fees, commission splits, and cooperation with other brokers.
- Supervision, duties, compensation, and termination
- Salary and benefits agreed on
Supervision, duties, compensation, and termination (Page 64)
Who needs to disclose material facts related to a transaction in illinois?
Listing agents, buyer’s agents, and sellers (Page 45)
What is TRUE of licensed personal assistants under the Real Estate license Act of 2000?
- They must be licensed as brokers
- They need an employment agreement with the broker with whom they work day to day
- They are usually paid directly by the person who selected them and when with whom they work most closely
- They need an employment agreement with the sponsoring broker and must be paid by the sponsoring broker.
They need an employment agreement with the sponsoring broker and must be paid by the sponsoring broker. (Page 64)
What is TRUE about real estate advertising in illinois under the Real estate license act of 2000?
- The company name must appear in a print ad for houses
- Whenever the company name does appear, it must be in letters larger than the sponsored broker’s name
- Links on a broker’s real estate website must routinely be approved by IDFPR
- The company name is usually not needed on a website
The company name must appear in a print ad for houses (Page 266)
Which of these does NOT need to be disclosed in illinois?
- To a buyer: the fact that the seller is also a client
- To a seller’s agent: the fact that the buyer client qualifies for the purchase price with only $5,000 to spare
- To a customer who is just starting to work with the licensee: he is a customer, but that agency is possible and may very quickly be presumed in illinois if nothing is said
- To a buyer client: the fact that the licensee holds a 1.1% interest in a property he wants to buy
To a seller’s agent: the fact that the buyer client qualifies for the purchase price with only $5,000 to spare (Page 36)
Who may pay compensation to a broker in illinois?
Sponsoring broker (Page 75)
Which of these may be offered to an illinois licensee for referring business to a lawyer or loan officer?
- A weekend in peoria
- A small stereo
- A cash amount less than $200
- None of these
None of these (Page 441)
For which of these could a licensee be late in illinois without affecting license renewal?
Mortgage payment (Page 271)
Under the Real Estate License Act of 2000, when the license of any sponsoring broker is suspended or revoked, what is TRUE regarding sponsored licensee’s agreements with that sponsoring broker?
- They expire on the date of suspension
- Each licensee has 10 days in which to find another sponsoring broker
- A licensee can continue to work through the suspension
- The licensee has 30 days to which to finish all deals
They expire on the date of suspension (Page 66)
Which of these licensee statements is appropriate in illinois
- Licensee answering a call-in customer’s question: “The standard commission is 6%.”
- Listing agent to bueyr’s agent: “List price is $200,000 but my seller will probably sell for about $195,000.”
- buyers’ agent to listing agent: “My buyers need to buy this weekend, so I think we can get this deal together.”
- Licensee to a licensed personal assistant: “Thanks for your help on this transaction, but I acn’t cut you a check.”
Licensee to a licensed personal assistant: “Thanks for your help on this transaction, but I can’t cut you a check.” (Page 76)
When a broker passes the license examination, the first proof of the eligibility to engage in real estate activities in illinois is a
sponsor card (Page 258)
What should a buyer’s agent check first if a buyer indicated he does NOT want to buy a home in a floodplain?
Floodplain maps for the area(s) in which the buyer is interested (Page 104)
What is the guideline for when agency should be disclosed in illinois?
As early as possible (Page 265)
Which of these is TRUE concerning dual agency in illinois?
Dual agency is permitted so long as the buyer and the seller are informed and consent to the representation of both in writing (Page 264)
Under the Real Estate License Act of 2000, what must be in writing?
- grantees signature on the deed
- All listings
- Exclusive agency and exclusive right to sell listings
- Agency between a buyer and a broker
Exclusive agency and exclusive right to sell listings (Page 89)
A broker placed the following order with the telephone company: “list my name in the directory under the heading Real Estate as ‘John Smith, Real Estate broker, Residential Property is My Specialty.’” The broker is required to include what?
The name of his employing (Sponsoring) broker (Page 266)
Who designates a sponsored broker in illinois to act as designated agent?
The sponsoring broker (Page 48)
Actions being brought against licensees under Article 15 (Agency Relationships of the Real Estate License Act of 2000 must be taken
- Within five years after the facts become known
- Within one year after the facts become known
- Any time after the closing if negligence can be proven
- Within six months after closing
Within five years after the facts become known (Page274)
Under the Real Estate License Act of 2000, which of these statements is TRUE
- The person with whom a licensee works is always a customer if nothing else is said
- The person with whom a licensee works is a client if nothing else is said
- The person who works with buyers who do not want client status is called their agent
- A client becomes a client only when the agency agreement is signed
The person with whom a licensee works is a client if nothing else is said (Page 55)
Who pays a licensed leasing agent?
The sponsoring broker (Page 55)
How long may an individual work as a leasing agent without a license in illinois, provided the agent is working to obtain a license and has a sponsoring broker?
120 days (Page 255)
An illinois licensee has listed a property whos owner has AIDS. what should the licensee do?
Not mention this to anyone; unless the owner directs the agent to do so (Page 44)
Which of these is TRUE about leasing agents in illinois?
- Leasing agents in illinois may operate independently as long as they approved by IDFPR
- While leasing agents are not licensed, a test indicating basic competence must be passed to work as a leasing agent
- Leasing agents must have a sponsoring broker
- Leasing agents may work without a license for 130 is properly supervised
Leasing agents must have a sponsoring broker (Page 251)
A buyer’s agent is showing properties to a young mother of three children who’s safety is paramount to her. Which of these is NOT appropriate?
- The agent tells the mother she can check addresses of convicted but released sex offenders online
- The agent decides to show only certain neighborhoods
- The licensee checks properties surrounding an interesting subject property carefully for any signs of oil leaks, USTs, formaldehyde odors, gas odors, bogs, or fire/explosion hazards
- The buyer’s agent recommends radon testing, carbon monoxide detectors, and water testing
The agent decides to show only certain neighborhoods (Page 402)
Under the Real Estate License Act of 2000, which of these statements describes how a licensed personal assistant is paid?
- Whichever broker the personal assistant works for on a daily basis pays the assistant
- Fees usually come straight from any closings on which the licensed assistant has participated.
- The cooperative broker fee covers the personal assistant
- The sponsoring broker pays the licensed personal assistant
The sponsoring broker pays the licensed personal assistant (Page75)
How much do local 9City or town) tax stamps in illinois cost?
vary by town (Page 228)
In illinois, if a sponsored broker leaves one firm to go to another, what happens to the broker’s listings?
Stay with the sponsoring broker unless the employment agreement stipulates otherwise (Page 88)
A licensee must have the owner’s written consent to advertise their house…
- In a newspaper
- by putting up a yard sign
- Online
- In all of these ways
In all of these ways (page 111)
In illinois, which type of deed becomes null and void after one year if it is not recorded?
Tax deed (Page 177)
An expired real estate license may be renewed in illinois for how many years
Two years (Page 259)
Which of these escrow record must be kept by a broker?
- Journal
- Ledger
- Monthly reconciliation statements
- All of these
All of these (Page 265)
The principal to whom a real estate agent gives advice and counsel to is called a….
Client (Page 34)
The Real Estate Recovery Fund was created for what reason?
To provide a means of compensating people who have been harmed by a licensee’s negligence (Page 274)
The MOST important purpose of the Real Estate License act of 2000 is to…
Protect the public (Page 247)
Real estate licensees in illinois must disclose
- Minor problems in the neighborhood of which they have knowledge
- Designated agency
- Special compensation found outside the scope of their agency relationship
- All of the above
Designated agency (Page 55)
Which appraisal licensing category allows an appraiser to appraise residential property of one unit to four units without regard to transaction value or complexity?
- Associate trainee real estate appraiser
- Certified residential appraiser
- Certified general real estate appraiser
- None of these
Certified residential appraiser (Page 356)
Escrow records must be maintained for at least how many years?
5 years (Page 266)
Illinois recognizes which of the following estates?
- homestead
- courtesy
- Dower
- Community property
Homestead (Page 130)
In illinois, in order to be eligible for a homestead estate, an owner must do what?
Reside in the property (Page 130)
What is the composition of Real Estate Administration and Disciplinary Board?
Nine members appointed by the governor (Page 249)
When does a leasing agent’s license expire?
On January 1, every third year (page 260)
Which of these may NOT be offered to consumers in illinois
- Coupons to the local grocery store if they list
- Discounts on commission if they list
- A new television if they buy
- A finder’s fee for referring client prospects
A finder’s fee for referring client prospects (Page 250)
Which of these would NOT happen for offenses noted in the Real Estate License Act of 2000?
- $5,000 fine
- 25,000 fine
- License Revoked
- Commissions seized
Commissions seized (Page 269)
An unlicensed individual who engages in activities for which a real estate license is required is subject to which of these penalties?
- A fine not to exceed $1,000
- A fine not to exceed $5,000 and on year imprisonment
- A civil penalty of $25,000 per count in addition to possible other penalties stipulated by law
- A civil penalty not to exceed $25,000 and a mandatory prison term not to exceed five years
A civil penalty of $25,000 per count in addition to possible other penalties stipulated by law (Page 253)
What is an exclusive right to sell listing?
One broker is appointed as the seller’s sole agent. THe listing broker is given the exclusive right, or authorization, to market the seller’s property. If the property is sold while the listing is in effect, the seller must pay the broker a commission regardless of who sells the property.
What is an exclusive agency listing?
One broker is authorized to act as the exclusive agent of the seller-principal. However the seller retains the right to sell the property without obligation to the broker.
What is an open listing?
The seller retains the right to employ any number of brokers as agents. The brokers can act simultaneously, and the seller is financially obligated only to that broker who successfully produces a ready, willing, and able buyer.
What is a net listing?
The seller will receive a net amount of money from any sale, with the excess going to the listing broker as commission.
What is an option listing
Gives the broker the right to purchase the listed property at some point in the future.
What secures the lender’s interest in real estate when providing money to a property owner?
Mortgage lien
A form of incurable depreciation because of external factors that causes a property lose value is referred to as
Economic obsolescence
What is an essential element of a valid contract?
Recording the deed
All of the following can levy taxes on real property except?
- The federal government
- The local elementary school district
- The city
- The local park district
The federal government
In illinois, a broker has an oral exclusive right to sell listing for 6 months. This type of listing would be
Unenforceable
The intent of article 15 in the RELA on agency refers to the regulations governing the relationship between who?
Real estate licensees and consumers
What would be considered to be a licensed activity under the definition of “broker in the RELA EXCEPT
- Holding an open house for other brokers
- Holding an open house for consumers
- managing commercial rental space
- Selling real estate at auction
Holding an open house for other brokers
A seller has listed their property with a broker, but reserves the right to sell the property himself without paying commission. What type of listing agreement is this?
Exclusive agency
Local zoning ordinances regulate which activity?
- Income tax
- Sales tax
- Who may own a business
- The number of buildings
The number of buildings
Real property may be owned in the following for EXCEPT *trust sole proprietor or individually *Limited liability company *beneficial interest
Beneficial interest
Who are the parties in a listing agreement?
The seller and the listing sponsoring broker
Who is responsible for maintaining sound financial conditions in federal banking institutions?
Federal Reserve System
The Chicago Bar Association v. Quinton and Tyson court case established a precedent in the practice of real estate brokerage concerning what?
The unlicensed practice of law
Which type of listing provides the most protection for the broker?
Exclusive right to sell
When disclosing environmental hazards, all of the following must be disclosed to a prospective buyer as environment hazard EXCEPT
- Lead-based Paint
- Meth
- Radon
- Wetlands
Wetlands
What are the rights and obligations to ownership of land adjacent to or abutting a river or stream?
Riparian rights
Which of the following are effects of zoning ordinances, EXCEPT
- Building height
- Building set back
- Property use
- Rent control
Rent control
What is best described as the illegal practice of a lender denying credit or restricting loans in a specific area of town?
redlining
A freehold estate in real property lasts for
An indeterminate amount of time
An open listing agreement is considered to be
Unilateral
Which of the following items would NOT be considered a fixture
- A refrigerator
- Bathroom faucets
- A heating unit
- Kitchen cabinets
A fridge
Local municipalities can regulate the homeowner’s use of property by establishing
The number of persons allowed per bedroom
The unrestricted rights associated with land that borders lakes, seas, and oceans are
littoral rights
A broker signs an exclusive right to sell listing with a seller. During the term of the listing, the seller finds a buyer on her own and closes the sale. Under the listing contract, the seller owes the broker
A full commission
How many house of post license education are required prior to a broker’s first renewal?
30 hours
Which statement most accurately describes an exclusive agency listing?
The seller retains the right to sell the property on his/her own
All of the following are essential elements of a valid real estate contract, EXCEPT
- Legal to be sold
- conveyance of deed
- Offer and acceptance
- Consideration
Conveyance of deed
The person who provides a mortgage to secure a debt is
mortgagor
