ALL Chapters LEGAL CA RE

Question 1

The main California state agency charged with the enforcement of the real estate law is the

• Department of Business Oversight (DBO).
• Department of Real Estate (DRE).
• Real Estate Division (RED).
• Office of Real Estate Appraisers.

Answer 1

• Department of Real Estate (DRE).

Question 2

In most cases, a decision rendered in an arbitration proceeding is binding upon the parties.

• True
• False

Answer 2

• True

Question 3

Police power is the right of the government to seize private property for public use.

• True
• False

Answer 3

False

Question 4

A lawsuit begins when a plaintiff files a complaint with the court.

• True
• False

Answer 4

True

Question 5

Cases relating to real estate matters are first brought at the

• trial court level.
• appellate court level.

Answer 5

trial court level.

Question 6

Many civil lawsuits result in settlement once the discovery stage has been completed.

• True
• False

Answer 6

True

Question 7

Under California law, property acquired by spouses during their marriage is owned as community property.

• True
• False

Answer 7

• True

Question 8

The highest court, also known as the court of last resort, is

• the United States Supreme Court.
• the Ninth Circuit Court of Appeals.

Answer 8

• the United States Supreme Court.

Question 9

California is the location of the Federal Circuit Court for the Ninth Judicial Circuit.

• True
• False

Answer 9

true

Question 10

California’s community property law originated with Spanish civil law.

• True
• False

Answer 10

true

Question 11

Which one of the following is TRUE about a California Real Estate Broker?

• A broker may not hire unlicensed personnel such as a bookkeeper to maintain the client trust account.
• A broker should establish a policy and procedures manual.
• A broker is not required to supervise affiliated licensees if they are hired as independent contractors.
• Brokers are not liable for the actions of affiliated licensees if supervision and control is not adequately exerted.

Answer 11

A broker should establish a policy and procedures manual

Question 12

Under single agency representation, which of the following IS NOT a common law fiduciary duty owed to the principal?

• Care
• Accounting
• Obedience
• Loyalty
• Disclosure
• Compassion

Answer 12

Compassion

Question 13

California Civil Code 2079 does NOT require

• the seller and buyer agents in residential property transactions to provide both the seller and buyer with written and oral disclosures regarding agency relationships and issues.
• that all agency relationships be confirmed in the real estate purchase and sale agreement.
• that the agency disclosure form be provided in business opportunity transactions.
• any disclosed agency relationships to be acknowledged by the principals in the purchase and sale agreement.

Answer 13

that the agency disclosure form be provided in business opportunity transactions

Question 14

The person who hires another and delegates authority to that person to act on their behalf is known as:

• a principal.
• a third party.
• a customer.
• an agent.

Answer 14

a principal

Question 15

Which one of the following is TRUE?

• The creation or existence of a compensation agreement does not establish an agency relationship between the giver of compensation and the recipient.
• California Civil Code requires consideration to create an agency relationship.
• The fact that a buyer’s agent receives compensation as a percentage of the total commission monies paid by the seller establishes an agency relationship between the buyer’s agent and the seller.

Answer 15

The creation or existence of a compensation agreement does not establish an agency relationship between the giver of compensation and the recipient

Question 16

A type of listing agreement that can be entered into with many licensees with the commission being owed only to the licensee who brings the buyer is known as

• an exclusive agency listing.
• a net listing.
• an exclusive listing.
• an open listing.

Answer 16

an open listing

Question 17

The Easton case led the California legislature to require expanded duties of real estate licensee to a third party to include all of the below, EXCEPT

• the duty of a real estate licensee to conduct a reasonably competent and diligent visual inspection of the property offered for sale.
• honest and fair dealing and to act in good faith.
• to disclose all material facts to third parties that a licensee knows or should have known if a reasonable and diligent inspection had been performed.
• utmost loyalty and lawful obedience.

Answer 17

utmost loyalty and lawful obedience

Question 18

An enforceable agency relationship can be entered into by

• an individual appointed by the court to represent the interests of one who does not have legal capacity.
• a minor.
• an obviously intoxicated person.
• All of the above

Answer 18

an individual appointed by the court to represent the interests of one who does not have legal capacity

Question 19

An agency relationship is NOT terminated

• once a suit for specific performance is instituted.
• if either the principal or the agent dies or becomes legally incapacitated.
• when the principal and agent mutually agree.
• when the purpose for which it was created has been fulfilled.

Answer 19

once a suit for specific performance is instituted

Question 20

The agreement that provides the most protection for payment of a commission for the listing broker is

• an exclusive agency listing.
• an open listing.
• a net listing.
• an exclusive right to sell listing.

Answer 20

an exclusive right to sell listing

Question 21

In terms of basic physical characteristics, land is properly described as

• indestructible
• immobile
• nonhomogenous
• all of the above

Answer 21

all of the above

Question 22

A section

• is 36 square mile
• will be divided into surveys
• contains 640 acres
• is 2640 feet per side

Answer 22

contains 640 acres

Question 23

Trade fixtures:

A. are intended to remain the property of the tenant

B. may be removed at the end of the lease if not prohibited in the terms of the lease

• both a and b
• a only
• b only
• neither a nor b

Answer 23

both a and b

Question 24

Which type of legal description uses a plat map?

• rectangular survey
• lot and block
• metes and bounds
• street and number

Answer 24

lot and block

Question 25

Concerning water rights in California, it is true that: A. California is a system based upon the system of prior appropriation B. a water right is an appurtenance * Both a and b * b only * a only * neither

Answer 25

both a and b

Question 26

Which of the following statements best descirbes the concept of land ownership? * Your rights are limited to the surface. * Ownership includes the land, fixtures, plus air space above and downward to the center of the earth. * You have lateral support but no rights to underground minerals unless specifically granted to you. * You only own the surface of the property and no portion of the airspace.

Answer 26

ownership includes the land, fixtures, plus air space above and downward to the center of the earth

Question 27

Which one of the following statements concerning riparian rights is TRUE? * They are found in the public records * They are the exclusive right to use ocean water that touches one's land * They are listed in the warranty deed * They are the right to reasonable use of river water that touches one's land in some jurisdictions

Answer 27

They are right to reasonable use of river water that touches one's land in some jurisdictions

Question 28

under the rectangular survey system, the legal description of a particular land unit is based on * metes and bounds. * one principal meridian and one baseline. * one range. * one township line.

Answer 28

one principal meridian and one baseline

Question 29

Which one of the following statements is FALSE regarding metes and bounds legal descriptions? * "Bounds" refers to natural or artificial boundaries. * An actual survey of the property is usually necessary. * There is no point of beginning. * They always start from some physical marker known as the point of beginning.

Answer 29

there is no point of beginning

Question 30

The legal right of a property owner to the natural support provided by the land surrounding the property is known as ____ support * contingent * lateral * subjacent

Answer 30

lateral

Question 31

a corporation formed under the laws of California is * an articial person * a domiciled corporation * an illegal corporation * a foreign corporation

Answer 31

an artificial person

Question 32

Which is not a characteristic of a fee simple estate? * It is of indefinite duration * It must be transferable * It must be free of all encumbrances * It must be inheritable

Answer 32

it must be free of all encumberances

Question 33

Which one of the following statements regarding community property is FALSE? * A spouse's separate property requires the consent of the remaining spouse if it is to be transferred or encumbered. * If community funds are used to maintain or improve separate property, the property may lose its status as separate property. * Property conveyed to a married couple is presumed to be community property. * Neither spouse can make a gift of community property to a third party without the consent of the other.

Answer 33

a spouse's separate property requires the consent of the remaining spouse if it is to be transferred or encumbered

Question 34

Which statements ares TRUE concerning unit ownership? 1. Ownership in a cooperative usually requires purchase of shares of stock in the cooperative corporation. 2. Individual units in a condominium are conveyed and are financed as if they were single-family dwellings on separate pieces of land. * 1 only * 2 only * Both 1 and 2 * Neither 1 nor 2

Answer 34

both 1 and 2

Question 35

The simplest form of business ownership is a * sole proprietorship. * syndicate. * corporation. * partnership.

Answer 35

sole propietorship

Question 36

Which one of the following statements is FALSE regarding a planned unit development (PUD)? * Condominiums are considered to be PUDs. * It is a subdivision in which the unit and the land under it are owned by each individual purchaser. * Common areas are owned by all of the unit owners as tenants in common.

Answer 36

condominiums are considered to be PUDs

Question 37

When purchasing a cooperative unit, the purchaser receives all of the following, EXCEPT * full use and enjoyment of the common areas. * shares of stock in the corporation proportionate to the size of the unit being purchased. * a proprietary lease to the unit being purchased. * fee simple title to the airspace of the unit and common interest in the common areas.

Answer 37

fee simple title to the airspace of the unit and common interest in the common areas

Question 38

what does an owner receive when purchasing a condominium? * Fee simple title in airspace within the unit and tenancy in common in common areas. * Title in an apartment and tenancy in common of undeveloped land. * Tenancy in common in the building and tenancy in severalty in the common areas. * Tenancy in common in the building and common interest in other areas.

Answer 38

fee simple title in airspace within the unit and tenancy in common in common areas

Question 39

a type of concurrent ownership in real property with the right of survivorship held by unmarried persons is known as * community property. * joint tenancy. * tenants in common. * tenancy by the entirety.

Answer 39

joint tenancy

Question 40

Under California law, a subdivision is created by dividing land into __________ the purpose of sale, lease or financing. * six or more parcels * three or more parcels * five or more parcels * four or more parcels

Answer 40

five or more parcels

Question 41

In California, which of the following must be in writing in order to be enforceable? 1. a property listing agreement 2. a lease for less than a year * Both 1 and 2 * 1 only * 2 only * neither 1 nor 2

Answer 41

1 only

Question 42

The statute or act that requires a contract for the sale of land to be in writing is the * statute of frauds * written recording act * statute of writing * real estate licensing act

Answer 42

statute of frauds

Question 43

The term waiver is best defined as * estoppel * the mutual exchange of privileges * to voluntarily give up or surrender a right * detrimental justification

Answer 43

to voluntarily give up or surrender a right

Question 44

Which one of the following is FALSE regarding the formation of a contract? * A contract in the name of an entity that does not legally exist is valid. * If a person dies prior to notification of acceptance of an offer, the contract is void. * A party must be identifiable and exist at the time of notification of the acceptance of an offer.

Answer 44

a contract in the name of an entity that does not legally exist is valid

Question 45

Which one of the following is the best explanation of specific performance? * The date set for closing, at which all parties involved must be present and must sign and deliver all documents necessary to close the transaction. * A legal procedure or action brought by the tenant, requiring the lessor to produce a lease. * When either party has the right to cancel the contract provided legal notice is given. * A legal procedure or action brought by either the buyer or seller to enforce the terms of a contract.

Answer 45

a legal procedure or action brought by either the buyer or seller to enforce the terms of a contract

Question 46

A contract that results from neither a written nor oral agreement, but from the actions of the parties involved, is referred to as an

Answer 46

implied contract

Question 47

"an agreement between competent parties upon legal consideration creating legally enforceable duties and obligations" is a definition of * legality of object. * an offer. * a contract. * specific performance.

Answer 47

a contract

Question 48

Consideration in a contract * is always more than 10% of the purchase price. * can be an exchange of promises. * is not essential. * All of the above

Answer 48

can be an exchange of promises

Question 49

What is the meaning of novation? * Ratification * Substitution of a new contract between the same or different parties * Estoppel * Rescission

Answer 49

substitution of a new contract between the same or different parties

Question 50

In general, a buyer may not withdraw an offer to purchase the seller's property * before it is presented to the seller. * after receiving proper notification of the seller's acceptance of the offer. * after the seller's acceptance of offer but before the buyer is notified. * after an earnest money deposit has been given.

Answer 50

after receiving proper notification of the seller's acceptance of the offer

Question 51

Which one of the following is NOT the unauthorized practice of law? * Rendering opinions of the tax implication of a 1031 exchange. * Giving counsel on the meaning of legal documents or phrases within those documents. * Filling in the blanks on standardized real estate documents. * Giving advice on how title should be taken.

Answer 51

filling in the blanks on standardized real estate documents

Question 52

A type of written agreement that forms a contractual agency relationship between a licensee and a buyer is known as * a buyer's broker agreement. * an exclusive right to sell agreement. * an open listing agreement. * a multiple listing agreement.

Answer 52

a buyer's broker agreement

Question 53

which one of the following is MOST correct? * A listing salesperson may take the only signed copy of the listing agreement, make a copy of it, and then fax the copy to the seller within 24 hours. * A listing salesperson must give to the seller a signed copy of the listing at the time of signing. * A listing salesperson is required to take the only signed copy of the listing agreement to his/her broker for approval, and the broker is required to mail a copy of that agreement to the seller within three business days. * A listing salesperson may take the only signed copy of the listing agreement, make a copy of it, then mail the copy to the seller within three business days.

Answer 53

a listing salesperson must give to the seller a signed copy of the listing at the time of signing

Question 54

in order to be enforceable, a listing contract must meet all of the following requirements, except * be in writing. * be recorded at the county recorder's office. * be signed by all parties in title and the broker. * state a definite expiration date.

Answer 54

be recorded at the county recorder's office

Question 55

The most common type of listing agreement for residential real estate is the * open listing * net listing * exclusive right to sell listing * exclusive agency listing

Answer 55

exclusive right to sell listing

Question 56

An exclusive right to sell listing contract * provides the least protection for the listing broker. * guarantees a commission to the listing broker no matter who brings the buyer if a sale occurs during the listing period. * guarantees that the listing agent will receive all money received from the sale that exceed the seller's desired net proceeds.

Answer 56

guarantees a commission to the listing broker no matter who brings the buyer if a sale occurs during the listing period

Question 57

Which one of the following statements is FALSE regarding listing contracts? * A listing contract is subject to the Statute of Frauds. * A listing contract must contain a definite expiration date. * A listing contract must be in writing. * A listing contract can contain an automatic renewal provision.

Answer 57

a listing contract can contain an automatic renewal provision

Question 58

which one of the following is correct with respect to a licensee's role in preparing a purchase and sale agreement for a buyer? * A licensee can fill in the blanks of the standard form agreement and prepare addenda at the request of the buyer. * A licensee can fill in the blanks and sign the standard form agreement for his buyer if a house is found that meets the criteria of the buyer while the buyer is out of town. * A licensee can prepare a contract for a client that is not on a preprinted form. * A licensee should have the client fill in the blanks on the standard form agreement.

Answer 58

a licensee can fill in the blanks of the standard form agreement and prepare addenda at the request of the buyer

Question 59

a broker hires a salesperson to engage in real estate activity under his/her license. What type of agreement will the broker and salesperson enter into in order to define this relationship? * A listing agreement * A brokerage engagement agreement * An independent contractor agreement * A work-for-hire agreement

Answer 59

an independent contractor agreement

Question 60

a type of listing agreement entered into the several licensees that provides for payment of a commission to the licensee who brings the buyer is known as: * an exclusive right to sell listing. * a net listing. * an open listing. * an exclusive agency listing.

Answer 60

an open listing

Question 61

which of the following in a lease agreement prohibits the tenant from destroying or damaging the property? * Waste clause * Maintenance clause * Hold harmless clause * Alienation clause

Answer 61

waste clause

Question 62

a standard residential month-to-month rental agreement is which type of leasehold interest? * Holdover tenancy * Periodic tenancy * Lease for definite period * Tenancy at will

Answer 62

periodic tenancy

Question 63

Which one of the following contracts is a unilateral contract? * Mortgage. * Land sales contract. * Trust deed. * Option.

Answer 63

option

Question 64

Under an assignment of lease, the tenant * remains liable under the original lease agreement. even if the landlord consents to the assignment. * sublets the rental space to a third party. * may assign the lease to a thirad party without the consent of the landlord. * assigns and transfers all of the rights and responsibilities to a third party.

Answer 64

assigns and transfers all of the rights and responsibilities to a third party

Question 65

The type of lease that requires the tenant to pay a set amount, plus some of all of the building operating expenses, is known as a ___ lease * gross * percentage * net * indexed

Answer 65

net

Question 66

The phrase time is of the essense is most likely to be found in a * listing agreement. * real estate purchase and sale agreement. * deed. * broker's loan statement.

Answer 66

real estate purchase and sale agreement

Question 67

An offer can be terminated by 1. rejection by the offeree. 2. a counter offer. 3. revocation by the offeror. * 1, 2 and 3. * 1 only * 1 and 3 only * 2 and 3 only

Answer 67

1, 2, and 3

Question 68

Which of the following factors will NOT be considered in determining whether an item is a fixture or personal property * Its adaptability * Its cost * The relationship of the parties * Its method of attachment

Answer 68

its cost

Question 69

When a purchase and sale agreement has been signed by the buyer and given to the seller's agent along with an earnest money check, the * transaction becomes a valid contract. * earnest money must be returned to the buyer if the buyer withdraws the offer after the seller signs the agreement. * buyer can sue for specific performance if the seller refuses to sign the agreement. * transaction is considered an offer until the seller accepts the agreement and the acceptance is communicated to the buyer.

Answer 69

transaction is considered an offer until the seller accepts the agreement and the acceptance is communicated to the buyer

Question 70

Which one of the following is not a common contigency used for the benefit of the buyer? * Subject to the sale of the seller's property * Subject to an inspection * Subject to the sale of buyer's current house * Subject to obtaining a mortgage

Answer 70

subject to the sale of the seller's property

Question 71

which one of the following parties does NOT contribute to the completion of the Transfer Disclosure Statement? * Selling agent * Listing agent * Escrow agent * Seller

Answer 71

escrow agent

Question 72

If known, which of the following must be disclosed on the real estate Transfer Disclosure Statement? 1. Radon 2. Formaldehyde 3. Asbestos 4. Underground fuel storage tank * 1, 2, and 3 only * 1 and 3 only * None of the above * All of the above

Answer 72

all of the above

Question 73

Which one of the following statements regarding disclosure is TRUE? * HIV/AIDS cannot be disclosed even when asked; by law HIV/AIDS are not material facts that require disclosure. * If asked by a prospective buyer if an occupant died of AIDS or an AIDS-related syndrome within the last three years, the seller or licensee must reply truthfully if known. * The seller and licensees need not disclose to a prospective buyer the manner or occurrence of an occupant's death in the home if it occurred within the past three years. * If an occupant died of AIDS or an AIDS-related syndrome within the past three years, that fact must be disclosed to a prospective buyer.

Answer 73

HIV/AIDS cannot be disclosed even when asked; by law HIV/AIDS are not material facts that require disclosure

Question 74

Mello-Roos disclosures refer to * sexual predator database. * military ordinance locations. * disclosure of notice concerning special tax or assessments. * foreign investment in real property.

Answer 74

disclosure of notice concerning special tax or assessments

Question 75

Lead-based paint disclosures must be made in which of the following transactions? 1. The purchase of single-family residential structure 2. A property sold at foreclosure 3. Rental property certified under a federal program as lead-based paint free 4. The purchase of a duplex * 1 only * 1 and 3 only * 1 and 4 only * All of the above

Answer 75

1 and 4 only

Question 76

The document that a seller must provide to a buyer about the condition of the property being sold is called the * Real Estate Transfer Disclosure Statement. * Seller's Disclosure Statement. * Property Condition Disclosure Document. * Optional Disclosure Disclaimer

Answer 76

Real estate transfer disclosure statement

Question 77

Which one of the following is FALSE regarding the Transfer Disclosure Statement? * Transfers arising out of default or foreclosure do not require a TDS. * Any transaction regarding the sale, transfer, lease, or exchange of one-to-four residential units requires the seller to provide a TDS. * No TDS is required if a property is being sold "as is." * All mobilehomes must be treated as realty for TDS disclosure purposes.

Answer 77

No TDS is required if a property is being sold "as is"

Question 78

A Lead-Based Paint Disclosure must be provided to a buyer by the seller if the seller's home was built prior to \_\_\_ * 1978 * 1980 * 1990 * 1992

Answer 78

1978

Question 79

Neither the seller nor the agent's is liable for any error, inaccuracy, or omission in the Transfer Disclosure Statement if the * information provided was based on information received from a public agency or qualified expert. * seller and/or agent failed to exercised ordinary care in obtaining and transmitting the information. * seller filled out the form based on best guesses and assumptions. * damage caused by a known defect, such as a prior slide, had been repaired.

Answer 79

information provided was based on information received from a public agency or qualified expert

Question 80

Which of the following must be disclosed in the Real Estate Transfer Disclosure Statement (TDS)? 1. Easements affecting the property 2. A broken oven 3. Additions or alterations made without a permit 4. Neighborhood noise or nuisance problems * 2 only * 2 and 3 only * 1, 2, and 3 only * All of the above

Answer 80

all of the above

Question 81

which would cause a deed to be invalid in its inception? * Legal incompetence of the grantor * Failure to record the deed * Failure to state a monetary consideration on the deed * Legal incompetence of the grantee

Answer 81

legal incompetence of the grantor

Question 82

The transfer of title by descent and distribution means the owner * transferred his property interest by gift. * died testate, and property passes to his heirs. * transferred his property interest by sale. * died intestate and property passes to his heirs.

Answer 82

died intestate and property passes to his heirs

Question 83

The main purpose of a deed is to * provide a written instrument suitable for recordation. * evidence the change in title or transfer of an interest in real property. * identify the party to whom the tax statement should be sent. * evidence the terms of a real property transaction.

Answer 83

evidence the change in title or transfer of an interest in real property

Question 84

a quitclaim deed is frequently used to * convey a fee title to property * remove an escrow * convey an after acquired interest in real property * remove a cloud on a title

Answer 84

remove a cloud on a title

Question 85

In a land sale contract, the buyer 1. has equitable title to the property. 2. is entitled to a conveyance of the legal title when all payments have been made. * II only * I only * Both I and II * Neither I nor II

Answer 85

both 1 and 2

Question 86

Which is the right of a government to take ownership of a privately held property for public use against the wishes of the owner * Dedication * Eminent domain * Public grant * Police power

Answer 86

eminent domain

Question 87

A trust deed * conveys real property from the trustee to the purchaser once the loan is retired. * is a security instrument granting limited rights to the trustee. * transfer title to the successful bidder in a trustee's sale. * transfers title to the trustee until the beneficiary is paid in full.

Answer 87

is a security instrument granting limited rights to the trustee

Question 88

A means of acquiring title where the occupant has been in actual, open, notorious, exclusive and continuous occupation of property under a claim of right for the statutory period is known as * escheat. * prescription. * eminent domain. * adverse possession.

Answer 88

adverse possession

Question 89

which is a warranty given in a grant deed * That there are no encroachments * That the grantor has not transferred title to anyone else * A warranty that the grantor has no interest in the property * There is a cloud on title

Answer 89

that the grantor has not transferred title to anyone else

Question 90

Which deed is the most common one used to convey property in California * Deed of Trust * Bargain and Sale Deed * Grant Deed * Special Warranty deed

Answer 90

grant deed

Question 91

an easement created when there is no access to a street is * an easement by necessity. * an easement in gross. * a negative easement. * an easement by prescription.

Answer 91

an easement by necessity

Question 92

a trust deed is * a specific involuntary lien. * a general voluntary lien. * a specific voluntary lien. * a general involuntary lien.

Answer 92

a specific voluntary lien

Question 93

Easements cannot be terminated * by written release of the easement by the dominant tenement. * by the purpose for which the easement was created ceasing to exist. * by written withdrawal of the easement by the servient tenement. * by the merging of the dominant and servient tenements into one tract.

Answer 93

by written withdrawal of the easement by the servient tenement

Question 94

Right-of-way easements, such as those acquired by public utilties, are usually called * easements of necessity. * commercial easements in gross. * implied easements. * easements by prescription.

Answer 94

commercial easements in gross

Question 95

One difference between a license and an easement is that a license * must be in writing. * is a permanent right. * can be revoked. * can be assigned.

Answer 95

can be revoked

Question 96

With certain exceptions, a property tax lien has priority over other interests in real property * according to the date they were recorded. * regardless of when they were recorded. * only if the property owner agrees to assume the obligations. * based on when the tax law was passed.

Answer 96

regardless of when they were recorded

Question 97

An easement appurtenant 1. runs with the dominant estate as a property right. 2. involves a dominant and servient estate. * II only * Both I and II * I only * Neither I nor II

Answer 97

both 1 and 2

Question 98

which is an involuntary lien * Property tax liens * Home equity loan * Mortgage liens * Trust deeds

Answer 98

property tax liens

Question 99

If Don has a permanent right to travel across Bob's land, Don's property is * encumbered * the dominant tenement. * burdened by a cloud * the servient tenement.

Answer 99

the dominant tenement

Question 100

Restrictions on property owners in a subdivision development are sometimes called * encroachments. * covenants. * zoning constraints. * easements appurtenant.

Answer 100

convenants

Question 101

A clause in a promissory note that allows the lender to demand the entire principal due in the event of default is the: due on sale clause alienation clause defeasance clause acceleration clause

Answer 101

acceleration clause

Question 102

Under a trust deed, once the trustor has paid the beneficiary in full, the trustee will be instructed to record a satisfaction of mortgage a grant deed a quit claim deed a deed of reconveyance

Answer 102

primary lenders

Question 103

a type of mortgage with interest rate changes during the life of the loan based upon a specified index is known as a graduated payment mortgage a growing equity mortgage an adjustable rate mortgage a budget mortgage

Answer 103

an adjustable rate mortgage

Question 104

Truth-in-lending seeks to compel lenders to disclose loan terms to prospective borrowers limit the interest rate charged on mortgages limit the number of discount points to be charged by lenders steer residential mortgage borrowers to savings associations instead of commercial banks

Answer 104

compel lenders to disclose loan terms to prospective borrowers

Question 105

Which is TRUE regarding the priority of a lien benefiting a lender under a mortgage or trust deed? Priority is determined by the date the instrument was signed a property tax lien recorded after the date of a mortgage or trust deed will be a junior lien Following foreclosure the proceeds are first distributed to the lender if the mortgaagee is the first recorded security instrument, followed by property taxes and/or special assessments with any remaining monies distributed to the defaulting borrower Establishing lien priority by recording the mortgage or trust deed is crucial to the lender

Answer 105

A property tax lien recorded after the date of a mortgage or trust deed will be a junior lien

Question 106

Which statement is FALSE regarding a trust deed? under a trust deed, if the borrower defaults, the trustee has the power to sell the property through a process known as nonjudicial foreclosure following a trustee sale, any amount remaining after the beneficiary has been paid in full belongs to the trustor the trustor has a one year right of redemption following the trustee sale the trustor has up to five days prior to the trustee sale to cure any deficiency and pay all costs associated with the foreclosure action to reinstate the loan and prevent the sale of the property

Answer 106

the trustor has a one year right of redemption following the trustee sale

Question 107

a security instrument wherein the seller is the lender for the buyer and gives actual title to the buyer in exchange for the buyer promising to pay the seller a specified amount of money over time is known as a land sales contract a contract for deed an installment sales contract purchase money mortgage

Answer 107

purchase money mortgage

Question 108

In California, the statutory right of redemption following judicial foreclosure under a mortgage is 9 months 180 days 240 days one year

Answer 108

one year

Question 109

Which one of the following is FALSE regarding a mortgage or deed of trust? it makes the property collateral for the debt owed it creates a lien on the property that must be satisfied or assumed if title is to be transferred it is an encumbrance it is the written evidence of a debt owed

Answer 109

it is the written evidence of a debt owed

Question 110

All sales of real estate must be reported to the DRE FHA FED IRS

Answer 110

IRS

Question 111

When transactions involving the sale of real estate are placed in escrow, this means the buyer's agent is no longer involved the seller's agent holds the papers until the registration of title is completed a designated agent agreed to by the parties holds the necessary documents until the terms are met they are completed in secrecy

Answer 111

a designated agent agreed to by the parties holds the necessary documents until the terms are met

Question 112

In most cases, lien priority is established by the date of recording amount of the lien statute of limitation statute of frauds

Answer 112

date of recording

Question 113

the best way to discover defects on a title is by a search of title hiring a lawyer taking out property insurance calling the county surveyor

Answer 113

a search of title

Question 114

Which does NOT accurately reflect the duties of escrow agents? they must follow escrow instructions they are to act impartially for both the buyer and seller in reviewing legal documents, they are to provide any missing clauses they must act as fiduciaries until escrow is closed

Answer 114

in reviewing legal documents, they are to provide any missing clauses

Question 115

The real estate broker's commission is usually 1. shown as an expense to the seller on the closing statement 2. credited to the buyer on the closing statement both 1 and 2 2 only 1 only neither 1 or 2

Answer 115

1 only

Question 116

If the buyer in a real estate transaction deposits funds into escrow, the escrow agent can pay out the funds in accordance with the written instructions of the 1. principals to the escrow transaction 2. buyer alone, in the event the buyer is unable to obtain the financing which was a condition of the agreement to purchase. both 1 and 2 2 only 1 only neither 1 nor 2

Question 117

Which endorsement to a standard form title policy offers protection to lenders and home buyers of new construction builder's endorsement early issue endorsement vendee endorsement oil and gas endorsement

Answer 117

early issue endorsement

Question 118

On a closing statement, the sales price is a debit. to the buyer and a credit to the seller credit to the buyer and a debit to the seller debit to the buyer and a debit the seller credit to the buyer and a credit to the seller

Answer 118

debit to the buyer and a credit to the seller

Question 119

when prorating California real property taxes in a closing statement, what date is used as the beginning of the tax year may 31 january 1 july 1 november 15

Answer 119

july 1

Question 120

A standard subdivision consists of subdivisions with ___ parcels exactly two five or more ten or fewer four or fewer

Answer 120

five or more

Question 121

Governmental rights retained in private property do not include: the right of taxation land use controls eminent domain deed restrictions in a subdivision

Answer 121

deed restrictions in a subdivision

Question 122

Zoning is done by authority of petition the law of eminent domain police power the mayor

Answer 122

police power

Question 123

the enforcement of the laws setting standards for construction methods are materials is accomplished by way of the planning commission injuctive relief law enforcement officials the building permit system

Answer 123

the building permit system

Question 124

If there is a difference in the degree of restriction between zoning restrictions and deed restrictions, which has priority whichever is more restrictive zoning restrictions deed restrictions neither has priority

Answer 124

whichever is more restrictive

Question 125

the california law requiring project developers to submit environmental impact reports is CEQA EIR NEPA CERCLA

Answer 125

CEQA

Question 126

The subdivided lands law is administered by the secretary of state attorney general department of environmental quality real estate commissioner

Answer 126

real estate commissioner

Question 127

Under the California Fair Employment and Housing Act (FEHA) it is illegal to discriminatee against persons who rent or buy a home based upon Marital status disability including HIV and AIDS sexual orientation all of the above

Answer 127

all of the above

Question 128

Which is FALSE regarding special assessments? special assessments do not create a lien on real property only properties which benefit from a specific improvement are taxes proportionally to pay improvements they are imposed to pay for improvements such as construction of sewers, access to public utilities, widening of a street, etc. a benefict assessment is not deductible for federal and state tax purposes

Answer 128

special assessments do not create a lien on real property

Question 129

The process under eminent domain by which property is taken for public use is known as condemnation judgment lis pendens abstract of judgement

Answer 129

condemnation

Question 130

Which statement is FALSE regarding tenants of mobilehomes? They are entitled to a 12-month lease at the prevailing month-to-month rate Rental agreements may not contain a clause prohibiting a mobile home owner from keeping at least one pet they must be given a 60-day notice to terminate they must be given 30 days notice if there is to be a rent increase

Answer 130

they must be given 30 days notice if there is to be a rent increase

Question 131

The Costa-Hawkins Rental Housing Act greatly reduced the impact of rent control with respect to new housing, when the certificate of occupany was issused after February 1, 1990 apartment buildings located in Los Angeles Single-family dwellings none of the above

Answer 131

single-family dwellings

Question 132

The maximum amount of security deposit allowed for a furnished residential property is one month's rent two month's rent three month's rent $5000

Answer 132

three month's rent

Question 133

a tenant leased an apartment, but the landlord failed to provide heat during the winter because the tenant was always late with the rent. this is an example of actual eviction abandonment negligence constructive eviction

Answer 133

constructive eviction

Question 134

A landlord does NOT have to give a 24-hour notice to a tenant to arrange access to a rented premises to inspect the premises in an emergency to make agreed to repairs to show the premises to a prospective tenant

Answer 134

in an emergency

Question 135

The warranty of habitability means that the landlord of a rented residential property must provide adequate weatherproofing hot and cold running water stairways maintained in good repair all of the above

Answer 135

all of the above

Question 136

In California, an agricultural lease can not be longer than 1 year 30 years 51 years 99 years

Answer 136

51 years

Question 137

Which is an exclusive right belonging to the tenant? future ownership possession retaliation remodeling

Answer 137

possession

Question 138

A resident apartment manager is requireed when there are 16 or more units 20 or more units 10 or more units 25 or more units

Answer 138

16 or more units

Question 139

A lease cannot legally be terminated by expiration surrender constructive eviction destruction of the premises

Answer 139

constructive eviction

Question 140

California's real estate law is found in the sherman antitrust act corporate and franchise code business and professions code uniform commercial code

Answer 140

business and professions code

Question 141

the maximum amount that can be paid from the real estate education, research, and recovery account on behalf of a licensee as a result of judicial action involving one claimant is $10,000 $20,000 $50,000 $100,000

Answer 141

$50,000

Question 142

A licensee can advertise for a seller under a listing agreement without including a licesee designation and employing broker's idenity when the licensee's broker authorizes the licensee to do so in writing the advertisement is a flyer describing the interior of the listed property never requested to do so by the seller in the listing agreement

Answer 142

never

Question 143

When a real estate commissioner wishes to proceed against a licensee for a suspected violation of real estate law, the commissioner must first servce the licensee with a complaint a finding of fact and conclusion of law a demurrer an accusation

Answer 143

an accusation

Question 144

In california, real estate syndicates are regulated by the real estate investment trust act california attorney general commissioner of business oversight real estate commissioner

Answer 144

commissioner of business oversight

Question 145

Which is true regarding the advertising of a mobilehome for sale by a real estate licensee? the mobilehome must be in an established mobilehome park or on a lot where its use may continue for at least one year the mobilehome must be at least 40 feet long by 8 feet wide the mobilehome must be less than one year old to be advertised by a licensee the advertismenet must include location information for the mobilehome park

Answer 145

the mobilehome must be in an established mobilehome park or on a lot where its use may continue for at least one year

Question 146

which one of the following is NOT considered trust funds? a title to an automobile given as earnest money a deposit received by the licensee from a tenant occupying a home owned by the licensee funds given by a seller to defray future advertising costs a promissory note to be redeemed upon acceptance of an offer

Answer 146

a deposit received by the licesee from a tenant occupying a home owned by the licensee

Question 147

Under California law, the sale of a franchise is NOT exempt from registration with the Department of Business Oversight (DBO) if the franchisor provides the franchisee with an offering prospectus at least 48 hours prior to entering into a binding franchise agreement franchisor has a net wroth of 5 million dollars and has at least 25 franchises that have done continual business during the 5 year period preceeding the saale franchisee is selling his/her franchise

Answer 147

franchisor provides the franchisee with an offering prospectus at least 48 hours prior to entering into a binding franchise agreement

Question 148

all transactional documentation for listings, purchase and sale agreements, property management activities, exchanges and trust account records must be retained for a period of three years four years one year two years

Answer 148

three years

Question 149

A broker with a trust account must deposit trust funds received within three business days within two business days within 24 hours promptly

Answer 149

within three business days