CLIFF BOOK - TEST 3 Flashcards
In the government survey system, when, because of natural features, a lot less than a quarter section was created, it was referred to as a(n):
(A) odd lott; (B) survey lot; (C) substandard lot; (D) government lot
(D) government lot
These lots were numbered and called government lots.
A husband owns a rental building that he acquired before he got married. During the course of the marriage, he sells the building and buys another building. The new building he has acquired is considered:
(A) separate property; (B) community property; (C) partial community property; (D) joint property.
(A) separate property
Given the facts of the question and absent any other information, this is separate property.
Which of the following is not true when holding title to real property in co-ownership as tenancy in partnership?
(A) The partners’ interest in rents or profits must be equal; (B) The entire property is vulnerable for the debts of the partnership; (C) Upon the death of a partner, his interest goes to the surviving partner(s); (D) A partner’s right in the real property would be subject to community property rules.
(D) A partner’s right in the real property would be subject to community property rules
Tenancy in partnership requires equal, undivided interests in the real property. The real property in its entirety is made available to satisfy a partnership debt. Upon the death of one of the partners, the real property held by the partnership can pass to the surviving partner(s). What is not true is that the partnership interest in the real property would be subject to community property rules. Here is a subtle line of distinction. Real property held in tenancy in partnership does not become community property upon the demise of one of the partners. However, the partnership itself may be subject to community property regulation.
Design professionals such as architects
(A) are specifically prohibited from seeking a mechanic’s lien; (B) are specifically permitted to seek a mechanic’s lien; (C) may see a mechanic’s lien only on a construction project that has been completed; (D) are permitted to seek a mechanic’s lien without prior notice of default.
(B) are specifically permitted to seek a mechanic’s lien
The work may be planned or completed and notice of default must be provided.
Deed restrictions are also known as:
(A) enhanced zoning; (B) special permit provisions; (C) variances; (D) private contract restrictions.
(A) enhanced zoning
This terminology emphasizes the fact that a buyer voluntarily agrees to these restrictions when he purchase the property.
A limited partner’s liability in a real estate investment is:
(A) the same as a general partner’s; (B) limited to the amount of the investment; (C) limited as long as he assumes some of the responsibilities for management; (D) limited to the limited partner’s proportionate share of the overall partnership’s liability.
(B) limited to the amount of the investment
The principle protection of a limited partnership is the limitation of liability to the partner’s investment. This protection may be lost if the limited partner participates in the management of the company.
In a trust ownership situation, title is held by the trustee on behalf of the:
(A) trustor; (B) grantee; (C) beneficiary; (D) grantor.
(C) beneficiary
The terms grantor and grantee are not usually used in association with a trust ownership situation.
Which of the following is not actually a legal form of property ownership of real estate investment?
(A) limited liability company; (B) limited partnership; (C) S corporation; (D) syndicate.
(D) syndicate
The term syndicate is descriptive of a group of people pooling their funds to invest, but it is not a specific form of ownership or investment.
An open listing is an:
(A) express unilateral contract; (B) express bilateral contract; (C) implied unilateral contract; (D) implied bilateral contract.
(A) express unilateral contract
In an open listing, a seller agrees (express) to pay a fee if the broker finds a buyer. The seller is under obligation to pay (unilateral) only if the broker finds a buyer. The broker is under no obligation to market the property or attempt to find a buyer.
Cooperating brokers represent:
(A) the buyer; (B) the seller; (C) both the buyer and the seller; (D) whomever they have an agency agreement with.
(D) whomever they have an agency agreement with
Cooperating brokers work with other brokers, but they work for whoever hires them.
Pocket listings are:
(A) illegal; (B) unethical; (C) not a problem; (D) governed by the multiple listing service rules.
(D) governed by the multiple listing service rules
Although most MLS organizations do not permit pocket listings, they are not inherently illegal or unethical.
Buyer’s brokers may be paid by:
(A) only buyers; (B) only sellers; (C) either buyers or sellers; (D) cooperating brokers.
(C) either buyers or sellers
Remember that fiduciary duty may be given to the buyer, while the commission may be paid by either the buyer or the seller.
Broker A takes a listing to sell a house. Broker B brings a buyer to see the house and prepares an offer on behalf of the buyer. What do we know for certain about Broker B?
(A) She is a subagent of Broker A; (B) She is a buyer’s broker representing the buyer; (C) She is a cooperating broker; (D) She is a dual agent representing both seller and buyer.
(C) She is a cooperating broker
All we know for sure is that she is a cooperating broker, because cooperating brokers may be sellers’ or buyers’ agents and less likely dual agents.
The method for estimating reproduction or replacement cost that is most useful as a check on the other appraisal methods is the:
(A) historic cost index method; (B) quantity survey method; (C) unit-in-place method; (D) square foot method.
(A) historic cost index method
The historic cost index method, which uses a factor to account for increase in construction costs is most useful as a check on one of the other methods.
The estimated cost to build a 200-year-old house using modern materials and construction methods is called its:
(A) replacement cost; (B) reproduction cost; (C) rebuilding cost; (D) current cost.
(A) replacement cost
Choice B is wrong. Choices C and D may be semantically correct, but because the testers are interested in the licensee knowing the appropriate terms, the best choice is A.