CA Real Estate Principles Flashcards
A real estate salesperson is supervised by
any licensed broker.
the seller.
the buyer or seller.
the employing broker only.
the employing broker only.
The employing broker is held accountable for the salesperson’s conduct in performing business activities.
Pages 5-6
Every real estate broker must be licensed by the Bureau of
Corporations.
Real Estate.
State.
Housing.
Real Estate
When a real estate license expires, licensed activity must cease but the license may be renewed up to
two years later.
one year later.
three years late
Two years
A license that is not renewed before it expires may be renewed at any time up to two years from the expiration date. All licensed activity must cease before the license is renewed and a late renewal fee will be required.
(Page 21)
Under the Real Estate Law, a real estate salesperson works for a broker as an
agent.
associate broker.
independent contractor.
employee.
Employee
The applicant for a real estate salesperson’s license must complete how many college-level courses before taking the licensing examination?
Five
One
Three
Three
The Real Estate Law allows a business opportunity to be sold
with a special endorsement.
by a real estate licensee.
by a financial planner.
by a PRLS licensee.
By a Real Estate Licensee
Which of the following does NOT require a real estate license?
Negotiating a lease
Taking a listing
Presenting an offer
Selling your own property
Selling your own property
Real estate licenses are renewable for a period of
three years.
one year.
four years.
two years.
Four years
A real estate broker’s license may be obtained by any of the following except a
sole proprietorship.
partnership.
corporation.
limited liability company.
Limited liability company
California’s Real Estate Law is found in the
Financial Code.
Business and Professions Code.
Civil Code.
Government Code.
Business and Professions Code
There are three principal baselines and meridians in California. The intersection of the Humboldt Baseline and Meridian is in
southern California.
a state other than California.
northern California.
central California.
Northern California
The Humboldt Baseline and Meridian were established on Mt. Pierre in Humboldt County in 1853. The other two baseline and meridians were established a few years earlier.
(Page 52)
The rectangular survey system is also known as the
Torrens system.
lot, block, and tract system.
U.S. government survey system.
metes and bounds system.
U.S. government survey system.
The rectangular survey system is also called the section and township system, or the U.S. government survey system, and is used by the United States Surveyor General to survey public lands.
(Page 51)
The term real estate means the same thing as
real property.
intangible personal property.
ownership.
Personal property.
Real Property
Something that is used with the land for its benefit, such as a roadway or a waterway, is known as
personal property.
an encumbrance.
an appurtenance.
a fixture.
an appurtenance.
An appurtenance to land is anything used with the land for the benefit of its owners, such as a roadway, an easement, right of way, or condominium parking space.
(Page 45)
How many sections are in a township?
24
36
6
18
36
In the rectangular survey system, land is measured, divided, and numbered in each direction from the point of intersection of the baseline and the meridian in townships, each of which is an area of six miles square (36 square miles) made up of 36 townships of one square mile each.
(Pages 52-53)
Real property includes
all of these.
land.
appurtenances to land.
fixtures.
All of these
The California Civil Code definition of real property includes land, fixtures, anything incidental or appurtenant to land, and anything immovable by law.
(Page 43)
Today, more than 50 percent of California land is owned by the
state government.
municipalities.
federal government.
private sector.
Private Sector
Of the more than 100 million acres of California’s total area, government entities own about 49%, leaving the majority of ownership in the private sector.
(Page 41)
Personal property is usually transferred by a
purchase contract.
will.
bill of sale.
Deed.
Bill of Sale
Ownership of real property is usually transferred by an instrument called a deed. Personal property is usually transferred by a bill of sale.
(Page 48)
Under Spanish rule, land was owned primarily by the
missions.
king.
peasants.
Conquistadors.
King
In 1513, Balboa claimed all lands “washed by the Pacific Ocean” for the King of Spain.
Page 38
The test for a fixture does NOT include
relationship of the parties.
origin of manufacture.
method of attachment.
intent of the parties.
origin of manufacture.
The test for a fixture (MARIA) includes the method by which the thing is affixed; adaptability of the thing for another use; relationship of the parties, intent in using the thing, and agreement of the parties.
(Pages 46-47)
The right of possession is restricted under a
life estate with a right of reversion.
freehold estate.
fee simple qualified.
fee simple subject to power of termination.
fee simple subject to power of termination.
Fee simple subject to a power of termination is ownership in which the right of possession is restricted in some way by some limitation or condition.
(page 63)
Community property is
all property acquired during marriage.
the only form of ownership during marriage.
all property acquired by the husband during marriage.
all property acquired during marriage that is not separate.
all property acquired during marriage that is not separate.
Community property is real or personal property acquired by either spouse during marriage or by registered domestic partners during that relationship. Community property cannot be sold, mortgaged, or leased for one year or longer without agreement of both spouses or registered domestic partners.
(page 69)
The right of the future holder of what is currently a life estate is a
fee simple conditional.
remainder.
fee simple subject to a power of termination.
fee simple defensible.
Remainder
The owner of a life estate has the right to possession and use of property but only as long as the life of an identified person(s). If the right of possession and use goes to a third person when the life estate ends, rather than returning to the grantor of the life estate, that person has a remainder interest while the life estate is in existence and a fee simple estate on termination of the life estate.
(page 64)
A holder of which of the following ownership interests can devise her share of the property to someone else?
Tenancy in partnership
Community property with right of survivorship
Joint tenancy
Tenancy in Common
Tenancy in common
A tenant in common can give away, sell, or devise (will) her share of the property to someone else. The recipient receives the share of the tenant in common and full right of possession.
(Page 67)
Ownership in severalty is
community property.
concurrent ownership.
a joint tenancy.
separate ownership.
Separate Ownership
Ownership in severalty, also called separate ownership or sole ownership, is ownership by one person. The property owner is the only person to receive the benefits (and responsibilities) of ownership.
(page 66)
The highest form of modern land ownership is known as
a fee simple absolute.
an estate for years.
a real estate trust.
A life estate.
A fee simple absolute
The highest (most complete) form of ownership is a fee simple absolute, in which right of possession is not restricted. (page 63)
Someone who receives real property is known as the
mortgagee.
devisor.
Grantor.
Grantee.
A grantee
A conveyance of real estate is called a grant; the person conveying the property is the grantor, and the person receiving the property is the grantee.
(page 65)
The four unities of joint tenancy do NOT include
interest.
severance.
time.
possession.
Severance
The four unities of joint tenancy (TTIP) are: unity of time, title, interest, and possession.
page 68
In medieval England, the highest form of ownership was the
life estate.
freehold estate.
estate for years.
Leasehold estate
Freehold Estate
In medieval England, the freehold estate was the highest form of land ownership and the owner could use the property in any way without being subject to the demands of an overlord.
(page 62)
Which of the following is NOT considered concurrent ownership?
Community property
Joint tenancy
Ownership in severalty
Tenancy in common
Ownership in severalty
Concurrent ownership is ownership by more than one person at the same time. Ownership in severalty is ownership by only one person.
(page 66)
If a person dies without leaving a will, that person dies
statutorily.
administratively.
testate.
intestate.
Intestate
A person who dies without having made a will is said to have died intestate. All states make provision by law for distribution of the property of intestate persons.
(Page 81)
Which type of deed would be used when the purchaser pays off a loan secured by the real estate?
Grant deed
Reconveyance deed
Quitclaim deed
Trust deed
Reconveyance Deed
A reconveyance deed executed by the trustee is the means by which the trustee returns title to the trustor when the debt secured by the deed of trust is paid off. The beneficiary notifies the trustee that the debt has been cleared by sending the trustee a document called a request for reconveyance.
(Page 98)
A holographic will does NOT have to be
signed.
dated.
witnessed.
entirely handwritten.
Witnessed
A holographic will is one written by hand, dated, and signed by the testator. It does not need to be witnessed, but it must be entirely handwritten; there can be no printed or typewritten parts of the will.
(Page 82)
In order to be valid, a grant deed does NOT require
a proper writing.
recording.
a granting clause.
the signature of the grantor.
Recording
There is no legal requirement that a deed be witnessed, that the grantor’s signature be verified, or that the deed be recorded in the county recorder’s office; nevertheless, such steps are practical necessities to prevent problems. (Page 92)
The right of a government agency to take private property for a public use is called
a quiet title action.
a partition action.
escheat.
eminent domain.
Eminent Domain
Governmental entities have the right to acquire title to property by eminent domain.
Page 89
Private land can be conveyed for public use or ownership by all of these methods EXCEPT
adverse possession.
deed.
common law dedication.
statutory dedication.
Adverse Possession
Private land can be transferred for public use or ownership by common law dedication, in which a landowner devotes land to a public use (such as a roadway); by statutory dedication, in which certain areas (such as an easement) are set aside for intended public use; or by transfer of fee simple ownership by deed (the preferred method of public acquisition as it preserves the public character of the land). Land cannot be acquired for public use by adverse possession.
(Pages 87-88)
Land is torn away by the action of water in the process called
accretion.
reliction.
evolution.
avulsion.
avulsion
The natural force of a moving body of water acting gradually or suddenly may tear away land in the process called avulsion; it is distinct from erosion, in which rainfall wears away the surface of the soil.
(Page 84)
If an owner devotes land to a public use, such as a roadway, a transfer occurs by
common law dedication.
partition.
escheat.
condemnation.
Common Law Dedication
A common law dedication occurs when a landowner devotes land to a public use, as when a roadway is opened to public use or described as such in the deeds to adjoining parcels.
(Pages 87-88)
Accretion is the process of accumulating new soil
along a flowing body of water.
close to a baseline.
next to a lake.
adjacent to an ocean.
Along a flowing body of water
Land area can be increased by forces of nature; accretion is the process by which land adjacent to a flowing body of water accumulates new soil. (Page 84)
Which of the following deeds is a security instrument?
Trust deed
Grant deed
Quitclaim deed
Sheriff’s deed
Trust deed
The trust deed, also called a deed of trust, can be used when property serves as security for a debt, typically the loan used to purchase the property, but it can be any loan using the property as collateral to guarantee payment of the amount borrowed.
(Page 97)
When a landowner has the right to travel over the property of an adjoining landowner, the property that benefits from the easement right is called the
servient tenement.
tenant at will.
life tenant.
dominant tenement.
Dominant Tenement
The land benefited by the easement is the dominant tenement. The land over which the easement runs is called the servient tenement.
(Page 110)
Liens are classified as
encumbrances.
writs of attachment.
easements.
encroachments.
encumbrances
An encumbrance is anything that has an effect on the fee simple title to real estate or the use of the property. A lien is an encumbrance that makes property security for the payment of a debt or discharge of an obligation.
(Pages 104-105)
A mechanic’s lien requires
preliminary notice.
a servient tenement.
a promissory note.
a deed.
Preliminary Notice
If a mechanic’s lien will be filed, preliminary notice of intent to file the lien must be hand-delivered or sent by first-class registered or certified mail to the property owner, general contractor (if any), and construction lender (if any). (Pages 106-107)
A notice of nonresponsibility would protect an owner from
a mechanic’s lien.
trespassers.
a foreclosure.
an eviction.
A mechanic’s lien
The owner of real estate has protection if unauthorized work is begun on the property by posting a notice of nonresponsibility in a conspicuous place on the land and recording a copy of the notice with the county recorder within ten days of learning of the construction, repair, or other work. The notice must include a property description; the name, address, and property interest of the owner or other person giving notice; and a brief statement that the person giving notice is not responsible for any claims arising from the work.
(Page 107)
The right of an owner of a parcel of land to travel over an adjoining parcel of land is known as
a restriction.
an encroachment.
a covenant.
an easement.
An easement
The right of use for a particular purpose or to travel over someone else’s land is called an easement. An easement usually is the right of the owner of a parcel of land to travel over an adjoining parcel.
(Page 110)
A prohibition in a deed against a property use is known as
an easement.
a restriction.
a condition.
an encroachment.
A restriction
Any form of restriction is a limitation on the use of land. The most common private restrictions are the covenants, conditions, and restrictions found in a deed. Subdivision developers frequently make use of deed restrictions to ensure that the uniform appearance of the homes in a subdivision is maintained.
(Page 117)
A promise by a property owner NOT to do something is called a
prescription.
restraint on alienation.
covenant.
restriction.
A covenant
A covenant is a promise to do something or to refrain from doing something. Covenants are often used in leases (e.g., a tenant might promise to use the property only for a specified purpose). The remedy available when a covenant must be enforced will be an injunction or money damages.
(Page 116)
An improvement that extends onto an adjacent property without permission is an
easement.
avulsion.
encumbrance.
encroachment.
Encroachment
An encroachment occurs when part of an improvement extends over the boundary line between properties without permission. Fences and buildings are typical forms of encroachment. Even the roof eave of a building can be an encroachment if it extends into the airspace of a neighboring lot.
(Page 119)
Which of the following could NOT file a mechanic’s lien?
Architect
Equipment lessor
Home improvement lender
Contractor
Home Improvement Lender
A mechanic is anyone who performs work on real property or an improvement to real property or furnishes the material used in the work. Persons entitled to a mechanic’s lien include all those who work or supply materials at the request of the property owner, or any contractor, subcontractor, architect, builder, or other person placed in charge of all or part of a project.
(Page 105)
A condition that would prohibit a property owner from transferring title to the property is known as a
restriction.
restraint on alienation.
judgment.
writ of attachment.
Restraint on Alienation
A restraint on alienation is any condition that prohibits a property owner from transferring title to the property and is not legally recognized. An example would be a condition that the grantor’s consent be obtained before the grantee could sell the property. Such a restraint is void—totally ineffective—and the grantee holds the property free of the restraint.
(Page 116)
For tax purposes, a salesperson can work for the broker as
a dual agent.
a partner.
an independent contractor.
a subagent.
Independent Contractor
An independent contractor usually has great flexibility in accomplishing the task undertaken and will receive a commission based on completed transactions, instead of a salary, with no payroll deductions.
(Page 131)
When an agent represents both the buyer and seller in the same transaction, this action is
prohibited by the MLS.
an example of subagency.
against the law.
known as dual agency.
Known as a dual agency
In a dual agency, the same agent represents two principals in the same transaction. A dual agency places the agent in the precarious position of carrying out agency responsibilities to two principals whose interests are in opposition. Any agent who acts on behalf of both parties to a transaction is required by law to inform both parties and obtain their written consent to the dual representation.
(Pages 132-133)
An agent owes which of the following to a third party?
Duty of disclosure
Fiduciary duties
Duty of representation
Duty of trust
Duty of Disclosure
A real estate agent owes to a third person a duty of full disclosure of material facts that the agent knows regarding the property, unless prohibited by law from doing so. The agent bears this responsibility independent of any instruction received from the property owner. If the property owner tells the agent not to reveal certain defects, the agent must inform the principal that the agent cannot hide such information. To do otherwise would make the agent liable for money damages, and place the agent’s license in jeopardy.
(Page 162)
Real estate commission rates are
always 4 percent.
subject to cancellation.
fixed by law.
negotiable.
Negotiable
In California, real estate commissions are negotiable. There is no predetermined commission rate, and the seller and broker are free to set whatever rate they agree on.
(Page 141)
An agent is authorized to act in place of the principal by a
multiple listing clause.
power of attorney.
purchase contract.
listing agreement.
Power of attorney
An attorney-in-fact is an agent who has been granted a power of attorney by a principal. A power of attorney authorizes an agent to act in the capacity of the principal.
(Page 134)
One of the MOST important duties of agent to principal is the duty of
salesmanship.
beneficial conduct.
hard work.
loyalty.
Loyalty
One of the most important duties the agent owes the principal is the duty of loyalty. The agent’s role in the transaction is to consider the interests of the principal first and foremost.
(Page 159)
A real estate broker works for the
principal.
Bureau of Real Estate.
third party.
real estate board.
Principal
An agency agreement is a form of employment contract and can be structured in several ways. The principal is the employer, but the agent may act as either an employee or an independent contractor. The main difference is in the type of control the principal exercises over the agent.
(Page 131)
The Real Estate Law treats a salesperson as
an independent contractor.
an employee of the broker.
a general agent.
a dual agent.
An employee of the broker
A real estate salesperson can conduct business only as the agent of a broker and must have a written employment agreement with the broker. The Real Estate License Law always considers a salesperson to be an employee acting under the direct supervision and control of the broker. This is true even when the salesperson is treated by the broker as an independent contractor for compensation, work assignment, and tax purposes.
(Page 132)
The MOST commonly used form of listing agreement is the
open agreement.
exclusive agency.
exclusive right to sell.
net agreement.
Exclusive Right to Sell
The most commonly used form of agreement is the exclusive authorization and right-to-sell listing, by which the broker is entitled to a commission no matter who sells the property, even if the owner finds a buyer without the broker’s assistance.
(Page 145).
A nonexclusive listing agreement is also known as
an option listing.
an open listing.
an agency listing.
a net listing.
An open listing
An open listing is nonexclusive and a commission is earned only if the listing broker is the procuring cause of sale. To be the procuring cause of a sale, the agent must be the one who initiates a continuing series of events that result in a completed transaction.
(Page 144)
