Exam 201 General Flashcards
1
Q
3. A real estate salesperson, selling the listings of another broker firm, is directly responsible to account to: A. His or her broker B. The owner C. The listing broker D.The multiple listing service
A
A. His or her broker
2
Q
- A broker, informed by the seller that there is a problem with a leaking roof and termites, must do which of the following:
A. Inform a prospective buyer of these conditions
B. Require that the roof be prepared that an exterminator be hired before showing at
C. Urged the buyer to obtain an inspection but say nothing about the problem
D. Urge the buyer to require the seller to repair the problem before closing
A
A. Inform a prospective buyer of these conditions
3
Q
5. Mutual assent to a real estate contract is ordinarily indicated by: A. Attestation B. Offer and acceptance C. Acknowledgment D. A seal
A
B. Offer and acceptance
4
Q
- It’s a seller was to make a counteroffer after receiving an offer from the buyer:
A. Both buyer and seller should sign the original offer
B. The seller should not sign the original offer
C. The only buyer should sign the counteroffer
D. Only the seller should sign the counter offer
A
B. The seller should not sign the original offer
5
Q
1. If our property sold for 525,000 and an owner made 50% profit what he pay for it? A. $262,500 B. $350,000 C. $393,750 D $787,500
A
B. $350,000
Rational: 525,000 divided 150% or 1.5 = 350,000
6
Q
- In order to collect the commission under an exclusive right to sell, it is not necessary for the broker to prove that:
A. The listing had been signed by the owner
B. The listing was not in effect at the time of the sale
C. They were the procuring cause
D. Broker was licensed at the time of the commission was earned
A
C. They were the procuring cause
7
Q
8. Which of the following would not be a basis for the termination of the listing? A. The expiration of time being. B. Insanity of the agent C. Destruction of the property by fire D. Death of the listing salesperson
A
D. Death of the listing salesperson
8
Q
9. If seller B as induced buyer C, who is employed by him, to purchase property under the threat of dismissal, seller B has used: A. Undue influence B. Fraud C. A right Of rescission D. The statute of limitations
A
A. Undue influence
9
Q
- Unless agreed to the contrary, a commission is earned by a broker when the:
A. Escrow is opened
B. Funds are disbursed at settlement
C. Broker finds a buyer ready, willing and able to buy the sellers terms
D.seller paid the purchase price
A
C. Broker finds a buyer ready, willing and able to buy the sellers terms
10
Q
11. An assessment of taxes on real property according to the value of the property is known as which of the following: A. appraisal B. Ad valorem C. Replacement cost D. Accretion
A
B. Ad valorem
11
Q
- A mortgagor is released from the personal liability under mortgage:
A. When a new purchaser takes subject to the mortgage
B. When a new purchaser assumes the mortgage
C. When a new purchaser assumes the mortgage and there is a novation
D. When the mortgage is assigned to by the lender
A
C. When a new purchaser assumes the mortgage and there is a novation
12
Q
13. If the amount realized at a sheriffs sale of property forclosed because of a delinquent mortgage is more than the indebtedness, the excess belongs to: A. The sheriffs office B. the mortgagee C. the mortgagor D the purchaser
A
C. the mortgagor
13
Q
14. In the records of the courthouse, a second trust deed can usually be distinguished from the first trust deed by: A. The words first or second B. The date on the note C. The heading of the instruments D. The time and date of the recording
A
D. The time and date of the recording
14
Q
15. The individual that obtains a real estate loan by signing a note and mortgage is a: A. Mortgagor B. Grantor C. Optionor D. Trustor
A
A. Mortgagor
15
Q
16. Voluntary acceptance of a lower priority mortgage position is called: A. Nonconforming B. Subordination C. Estoppel D. Alienation
A
B. Subordination
16
Q
17. And of July 17 closing, with all adjustments paid through the day of closing, and the statutory year where the current county assessment is $2250 the buyers portion would be paid in arrears. Presented as a: A. Credit buyer $1231.25 B. Credit buyer $1225 C. Debit buyer $1231.25 D. Debit buyer $1225.
A
A.Credit buyer $1231.25
17
Q
18. I qualified fee simple estate may be: A. in perpetuity B. Reclaimed in grantors name C. Transfer and buy a bill of sale D. Interpreted as a gross easement
A
B. Reclaimed in grantors name
18
Q
19. A man has an opportunity to buy a lot for $1000, and has a guarantee of resale value one year later of $1200. he also has an opportunity to lend a $1000 to an individual with repayment within a year of 10% interest. Which is the better investment, and by what amount? A. $50.00. Better for lot B. $100.00 better for loan C. $50.00 better for the loan D. $100 better for the lot
A
D. $100 better for the lot
19
Q
- An exclusive right to sell agency may not be terminated prior to the expiration date when the:
A. Agency is coupled with an interest
b. Owner unilaterally declares the agency ended
C. Principal dies
D. Age it becomes incapacitated
A
A. Agency is coupled with an interest
19
Q
- A purchases a dwelling for $250,000. He makes a $50,000 deposit and agrees to pay 6% interest on the unpaid debt, plus $100 per month principle. He sells the house two months later at $280,000 to B, who assumes the mortgage. How much interest has A paid? B will receive credit on the purchase price for what amount?
A. A paid $1599.90; b Receives $188,000
B. A paid $1999.50; b receives $199,800
C. A paid $1189; be receives $199,900
D. A paid $1998.50; B received $199,900.50
A
B. A paid $1999.50; b receives $199,800
21
Q
21. A life estate may not be: A. Passed by a will B. Mortgaged C. Sold D. Leased
A
A. Passed by the a will
22
Q
22. A farmer in Colorado on some property which is legally described as: The S1/2 of NE1/4 of SW1/4 of section 16. How many acres are included in this parcel? A. 20 B. 40 C. 80 D. 60
A
A. 20
23
Q
- What form of interest is conveyed by a sales made with the provision that title shall revert to the grantor should an objectionable use take place?
A. A defeasible a state
B. And the state on a condition precedent
C. A fee simple absolute
D. A life estate
A
A. A defeasible a state
24
Q
- P and S form of valid joint tenancy. A year later, P sells his share to T. As a result:
A. P’s 50% interest increases to 66 and two thirds%.
B. S is 50% interest shrinks to 33 1/3%
C. T becomes a 50% owner and joint tenancy
D. This creates tenancy in common, between S and T
A
D. This creates tenancy in common, between S and T
25
25. A buys a house with an $80,000 first loan and a $5000 second loan which were recorded by the lenders. A $10,000 judgment lien is later recorded by someone the buyer owed money to prior to buying the home. Which lien has priority?
A. The $80,000 first
B. The $5000 second
C. The $10,000 judgment lien
D. The $10,000 judgment shares priority with the first
A. The $80,000 first
26
```
26. What type of lease is best for a commercial tenant during an inflationary.?
A. A gross lease
B. A percentage lease
C. And index lease
D. A net lease
```
A. A gross lease
27
```
27. Which lien has first priority?
A. Mechanics lien
B. Mortgage lien
C. Property tax lien
D. Federal income tax lien
```
C. Property tax lien
28
28. All of the following are necessary for a valid date except:
A. The grantee signature
B. The granting clause
C. Name of the grantor and grantee
D. Delivery and acceptance within the grantors last time
A. The grantee signature
29
```
29. Which do you imposes the least liability on the grantor?
A. General warranty deed
B. Special warranty deed
C. Quit claim deed
D. Bargain and sale deed
```
C. Quit claim deed
30
30. When does the law descent come in the play ?
A. When a person dies testate
B. When a person dies without having heirs
C. When a person dies intestate with heirs
D. When a person makes a living trust
C. When a person dies intestate with heirs
31
```
31. Gross income less vacancy and collection losses plus ancillary income is:
A. Effective gross income
B. Net operating income
C. Gross income
D. Effective net income
```
A. Effective gross income
32
```
32. RESPA requires disclosure of
A. Legal fees
B. Broker commissions
C. Loan payoffs
D. Prepayment penalties on loans to be paid off
```
D. Prepayment penalties on loans to be paid off
33
```
33. A tenants five year lease is terminated. He returns three months later to reap a crop planted before termination. The right arose from:
A. Prescription
B. Adverse possession
C. Tenancy for years
D. Emblements of personal property
```
D. Emblements of personal property
34
34. What is the value of the property where the gross rent multiplier it is 170 on the annual rent is $12,000:
a. $175,000
B. $170,000
C. $174,000
D. $175,500
B. $170,000
| Rationale: 12,000÷12 equals 1000×170 = 170,000
35
35. Under the equal credit opportunity act, a lender has the right to do all of the following except:
A. Check the borrower employment history
B. Charge for a credit report
C. Investigate the borrows payment history
D. Refusal a loan to persons over 55
D. Refusal a loan to persons over 55
36
```
36. Mortgage insurance is most often required where:
A. The loan to value ratio is high
B. Long terms of repayment are given
C. The borrowers are elderly persons
D. The borrower is a veteran
```
A. The loan to value ratio is high
37
```
37. Old cars parked on adjacent lots to the subject property will have a detrimental influence on the value of the subject property because of the principle of:
A. External obsolescence
B. Functional obsolescence
C. Physical deterioration
D. Anticipation
```
A. External obsolescence
38
```
38. In calculating tax relating to taxpayers primarily dwelling, he/she may deduct:
A. Property taxes paid
B. Mortgage principal repayments
C. Improvements
D. Depreciation
```
A. Property taxes paid
39
39. Hey sellers broker is sitting in the sellers office, having just presented an offer for the sellers house from buyer B. Before the seller signs the offer, the buyer found the broker on his mobile phone and informed him that he is withdrawing the offer. The buyer:
A. Cannot withdraw the offer as it has already been presented to the seller
B. Can only withdraw the offer in writing
C. Is entitled to withdraw the offer
D. Is in breach of the statute of fraud
C. Is entitled to withdraw the offer
40
```
40. An appraiser doing an appraisal on a commercial property would be most concerned with:
A. Before tax cash flow
B. Net operating income
C. Gross income
D. Effective gross income
```
B. Net operating income
41
```
41. One of the major differences between joint tenancy and tenancy in common is that:
A. Joint tenancy is not probated
B. Tenancy in common , must be written
C. Joint tenancy must be verbal
D. Both demand equal ownership interest
```
A. Joint tenancy is not probated
42
42. The differences between a cooperative in a condominium is that a condominium owner may:
A. Own and finance their property
B. Never own common interest assets
C. Have a proprietary lease
D. Always determine who their neighbors are
A. Own and finance their property
43
```
43. A corporation which is to purchase an entire property as sole owner. It would purchase as an/A:
A. Owner in severalty
B. Owner in entirety
C. Life tenant
D. Owner in equity
```
A. Owner in severalty
44
44. The broker doubts a sellers assurance that an access easement is no longer used. He should:
A. Except the sellers assurance
B. Advise the buyer of a possible encumbrance
c. Refused to continue with the mandate
D. Do nothing
B. Advise the buyer of a possible encumbrance
45
```
45. Which type of description would include "beginning at the…."?
A. Metes and bounds
B. Lots of blocks
C. Government survey
D. Colorado coordinate
```
A.. Metes and bounds
46
46. A broker is listing a cooperative owned by religious organization is told to give preferences to perspective buyers of the same religion. I husband-and-wife make an offer. The wife belongs to the said religion but the husband does not. The action of refusing to sell to the couple is legal under the fair housing act because:
A. this type of discrimination is permissible if the venture is not for commercial purposes
B. The fair housing act does not apply to charities
C. They're fair housing act does not apply to cooperatives
D. Religion is not protected right under the fair housing act.
A. this type of discrimination is permissible if the venture is not for commercial purposes
47
```
47. Which of the following will give the taxpayer the greatest benefit?
A. A tax depreciation of one dollar.
B. A tax credit of one dollar
C. Wages of one dollar
D. Commission of one dollar
```
B. A tax credit of one dollar
48
```
48. Taxes paid in advance are shown on the closing statement as
A. Debit seller, credit buyer
B. Credit seller, debit broker
C. Credit buyer, debit broker
D. Debit buyer, credit seller
```
D. Debit buyer, credit seller
49
```
49. How does an owner avoid a sale in execution after a forclosure?
A. By rescission
B. By novation
C. By Equitable redemption
D. By statutory redemption
```
D. By statutory redemption
| Page 230
50
```
50. What principle of appraisal holds that generally a property will achieve and maintain its maximum value when it is situated in a homogeneous area of a similar use properties?
A. Conformity
B. Competition
C. Contribution
D. Assemblage and plottage
```
A. Conformity
51
51. A broker has an exclusive agency listing contract with B. During the term of the contract, the seller sells the property to his cousin without any assistance from the broker. The broker is:
A. Entitled to full commission from the seller
B. Entitled to half the commission from the buyer.
C. Not entitled to any commission
D. Entitled to the full commission from the buyer
C. Not entitled to any commission
52
52. The owner of a two-story apartment building can:
A. Charge extra security deposits for families with children
B. Charge the maximum number of persons who can occupy the apartment from two to 1
C. Require children using the swimming pool to be supervised
D. Require families with children to occupy first floor apartments only
C. Require children using the swimming pool to be supervised
53
```
53. An appraiser, appraising an income/generating office building, would be most concerned with:
A. Gross income
B. net gross income
C. Effective gross income
D. Net operating income
```
D . Net operating income
54
54. Mutual assent requires all of the following except:
A. An offer and acceptance
B. Absence of fraud, misrepresentation or mistake
C. A warranty against defects
D. Agreement on all material terms
B. Absence of fraud, misrepresentation or mistake
55
55. Procuring cause refers to the:
A. Process of obtaining a listing on the property
B. Extension of the existing listing beyond its present termination date
C. Extension of the closing date
D. One who brings about the desired results and who is the predominant effective cause of the sale
D. . One who brings about the desired results and who is the predominant effective cause of the
56
```
56. The higher the leverage:
A. The greater the L T. V.
B. The less the lenders risk
C. The greater the equity
D. The more the borrowers funds are utilized
```
A. . The greater the L T. V.
57
```
57. Whether or not the FHA loan is qualified or unqualified assumption depends on:
A.the borrowers credit score
B. The date of the loan
C. The individual lender requirements
D. The amount of the loan to be assumed
```
B. The date of the loan
58
58. The person hypothecating real property is:
A. Selling it
B. Renting it
C. Giving up possession to a lender
D. Keep in possession of giving the lender a lien
D. Keep in possession of giving the lender a lien
59
59. A lien theory state :
A. the mortgagee takes title to the mortgaged property during the term of the mortgage
B. The mortgagor has a lien against the property for the full amount of the mortgage.
C. The mortgagor make foreclose only by court action
D. Mortgagor holds legal title to the property during the term of the mortgage
D. Mortgagor holds legal title to the property during the term of the mortgage
60
```
60. A mortgage instrument may include a clause that would prevent the assumption on the mortgage by a new purchaser. This clause could be called any of the following except:
A. And alienation clause
B. A due on sale clause
C. An Habendum clause
D. Non-assumption clause
```
C. An Habendum clause
61
```
61. The person of a party pledging real estate as security for a dad and a mortgage is called the:
A. Mortgagor
B. Mortgagee
C. Trustee
D. Beneficiary
```
A. Mortgagor
62
```
62. The brokers commission is based on 10 percent of the first 500,000 of the sale price. 5% of the next 500,000 of the sale price, and 4% on any amount over $1 million. the broker received hundred and $50,000 in commission after paying the cooperating broker 40%. How much did the real estate sell for?
A. $5,833,333
B. $2,500,000
C. $5,375,000
D. $7,500,000
```
C. $5,375,000
63
```
63. X owns a lot that fronts a Lake. Y owns the lot directly behind x's a lot. Y procures an easement from X to gain access to the lake. Which of the following is likely to be true?
A. The value of x lot is increased
B. The value of y lot is decreased
c. The value of y lot is increased
D. The value of x lot is not changed
```
c. The value of y lot is increased
64
```
64. A church group has given permission to use a camp on private property over the Fourth of July. This would be a consideration a/and:
A. Easement in gross
B. License
C. Temporary easement
D. Prescription
```
B. License
65
```
65. What kind of deed is used to guarantee that during the direction of the current owner, he has not jeopardize the title?
A. Corrective deed
B. Quit claim deed
C. General warranty deed
D. Special warranty deed
```
D. Special warranty deed
66
```
66. After gathering information for him various appraisal approaches, the appraiser must then:
A. Consolidate the approaches
B. Reconcile the approaches
C. Apply assemblage
D. Average the value
```
B. Reconcile the approaches
67
67. In valuing a public fire station, and appraiser would place the most emphasis on the:
A. Market approach
B. Cost approach
C. Income approach
D. Market, cost and income approach is equally
B. Cost approach
68
```
68. The best method of appraising an older home is:
A. Income approach
B. Cost approach
C. Market comparison approach
D. Gross rent multiplier method
```
C. Market comparison approach
69
```
69. A separate value for the land and improvements as needed for the:
A. Income approach
B. Gross rent multiplier
C.. Cost approach
D. Market comparison approach
```
C.. Cost approach
70
70. The four characteristics of value are:
A. Transferability, cost, scarcity, utility
B. Scarcity, utility, depreciation, transferability
C. Utility, appreciation, demand, cost,
D. Transferability, scarcity, demand, utility,
D. Transferability, scarcity, demand, utility,
71
```
71. Market value is most clearly related to:
A. Value in use
B. Value in exchange
C. Value in transit
D. Value in transition
```
B. Value in exchange
72
72. In comparing two properties you find that the comparable has a fireplace worth $3000 but does not have a carport worth $2000 as in the subject. You would:
A. Add $3000 to the comparable and add $2000 to the subject
B. Subtract $3000 from the comparable and subtract two thousand from the subject
C. Subtract only $1000 from the subject property
D. Subtract $1000 from the comparable
D. Subtract $1000 from the comparable
| Never subtract from subject.....
73
```
73. Ownership in common areas of the condominium as held by all owners as
A. Tenants-in-common
B. Joint tenancy
C. Co op
D. Partnership
```
A. Tenants-in-common
74
74. The method of depreciating investment property is to depreciate:
A. The value of the land only
B. The value of the improvement only
C. The difference between the improvement value less the cost of the land
D. The total value
B. The value of the improvement only
75
```
75. A $45000 house depreciates at twice the average rate of 40 years. What is the value after one year?
A. $42,750
B. $39,000
C. $39,500
D. $36,000
```
A. $42,750
Rationale:
One year divided by 40 years equals 2.5% times two equals .05%
$45,000 times 5% equals 2250. Subtract 2250 for 45,000 equals 42,750
76
```
76. A $50,000 loan has equal interest payments and then a final payment of $50,000. This is:
A. An amortized loan
B. A graduated loan
C. And adjustable loan
D. A term loan with the balloon payment
```
D. A term loan with the balloon payment
77
```
77. A promissory note:
A is redeemed at closing
B. Is evidence of a mortgage
C. Is security for a loan
D. Is an instrument of debt
```
D. Is an instrument of debt
78
```
78. A property owner wants to sell his home but does not want to list the property. He tells a broker, if you sell my home I will pay you a commission. This is most likely:
A. A net listing
B. And exclusive agency listing
C. The seller stated exclusive listing
D. An open listing
```
D. An open listing
| Telling is not in writing
79
```
79. Two people decide to buy real estate in the name of the corporation. What form of ownership of applies?
A. Joint tenancy
B. Tenancy in common
C. Tenancy by the entirety
D. Severalty
```
D. Severalty
80
```
80. Land is located in a flood plain. Use and control of these lands is a form of
A. Eminent domain
B. escheat
C. Police power
D. Adverse possession
```
C. Police power
81
```
81. Which would not be considered in the comparison approach:
A. Cost of comparable properties
B. Accrued depreciation
C. Cost per square foot
D. Condition of property
```
B. Accrued depreciation
82
82. According to the federal fair housing act of October 1998, which individual is permitted to reside in housing with the familiar status exemption?
A. 45-year-old employed nurse in a wheelchair
B. 53-year-old retired construction worker
C. 54-year-old retired teacher.
D. 63-year-old unemployed person
D. 63-year-old unemployed person
83
83. A lesser holds which of the following?
A. Leasehold
B. At least the interest with reversionary right
C. A remainder interest
D. An executor interest
B. At least the interest with reversionary right
84
```
84. In what type of lease does the lessee agree to pay certain costs of operating the building in order to provide a guaranteed annuity to the lessor?
A. Periodic lease
B. Graduated lease
C. Percentage lease
D. Net lease
```
D. Net lease
85
```
85. Which of the following interests may not be mortgaged
A. Leased fee
B. Leasehold
C. Life estate
D. License
```
D. License
86
```
86. In an appraisal using the income approach, an increase in the capitalization rate results in:
A. A decrease in value
B. An increase in value
C. A receptive Rate
D. A new offer
```
A. A decrease in value
87
```
87. When the words "point of beginning" are used in the legal description, the property has probably been identified by:
A. Lot and block method
B. The government survey method
C. The metes and bounds method
D. Azmuth method
```
C. The metes and bounds method
88
```
88. Building codes regulate:
A. Set backs
B. Zoning
C. Architectural design
D. Structural integrity
```
D. Structural integrity
89
89. Dual agency refers to which of the following:
A. Acting as an agent for two buyers who wish to purchase a home.
B. Acting for two sellers who wish to sell their house
C. A transaction broker relationship
D. Acting as an agent for the buyer and the seller in the same transaction.
D. Acting as an agent for the buyer and the seller in the same transaction.
90
```
90. What would an appraiser do as a first step in appraising a vacant site:
A. determine a capitalization rate
B. Determine a recapture rate
C. Do A soil analysis
D. Determine the highest and best use
```
D. Determine the highest and best use
91
```
91. To be transferred, a warranty must be:
A. Signed by the grantor
B. Recorded by the grantee
C. Signed by the grantee
D. Filed with the Secretary of State
```
A. Signed by the grantor
92
92. A developer is building a condominium with 20 units, two floors, but no elevator. In terms of the ADA, the developer must provide accessibility on:
A. The first floor only
B. The second floor only
C. The units to be sold to elderly persons only
D. The whole building
A. The first floor only
93
93. The seller does not wish to sell to a Hispanic buyer. The agent:
A. May select offers which meet this requirement and submit only those
B. Must submit all offers to the clients instructions
C. Must advise the seller that this is unlawful and that he/she cannot except this mandate
D. Can have his license revoked by HUD
C. Must advise the seller that this is unlawful and that he/she cannot except this mandate
94
```
94. What takes preference in a foreclosure?
A. A mechanics lien
B. A property tax lien
C. And income tax lien
D. A mortgage lien
```
B. A property tax lien
95
95. A seller sells her house add some furniture is included. The broker should ensure that at closing, she has:
A. A certificate of purchase for the house
B. A note
C. A security finance certificate
D. A bill of sale for the furniture
D. A bill of sale for the furniture
96
96. A small office building sold for 949,000 and the broker receive the commission of $54,990. What was the brokers commission rate?
A. 5.8%
B. 6.2%
C. 7%
D. 11.3%
A. 5.8%
| Rationale: $54,990 divided by $949,000 equals 5.79. Round the figure off and is 5.8%
97
```
97. A seller wishes to net $845,950 for the sale of her property. If her broker is to receive a fee of 4% of the selling price and I'm allowance of $50 for expenses, what must the selling price be?
A. $896,757
B. $889,600
C. $898,040
D. $881,250
```
D. $881,250
| Rationale $845,950 times .04 equals 33,850+50
98
```
98. What would be a sales person share of 60% of the total 10% commission on the sale of a vacant lot that is 80 feet wide and 220 feet deep? The property was sold at $150 per front foot?
A. $920
B. $615
C. $720
D. $790
```
C. $720
| Rationale: 80 foot times 150 equals 12,000×10% equals 1200×.0 60 equals 720
99
99. If the interest rate is 5 1/4% and the monthly interest payment is $350, the principal sum would be
a. $50,000
B. $80,000
C. $70,000
D. $60,000
B. $80,000
| Rationale: 350×12 = 4200÷.0525 equals 80,000
100
```
100. A man borrowed $1500 which he agreed to repay at 5 1/2% interest per annum . If he paid $25.21 in interest, how long did he keep the money?
A. Four months, five days
B. Two months, 20 days
C. Three months, 20 days
D. Four months, 20 days
```
C. Three months, 20 days
