Federal Laws Governing Real Estate Activities

Question 1

Which court case abolished the concept of separate but equal?

A: Dred Scott versus Sanford
B: Brown versus Board of Education
C: Plessy versus Ferguson
D: Jones versus Mayer

Answer 1

B: Brown versus Board of Education

Question 2

To have a qualified tax deferred exchange, what would be required?

A: Properties must be held for investment
B: Properties must not differ in value
C: The exchange must occur within 10 days after close of escrow
D: Boot is required to show valid consideration

Answer 2

A: Properties must be held for investment

Question 3

What statement requires full disclosure when advertising a residential property?

A: seller will carryback
B: $900 monthly rent
C: $900 monthly loan payment
D: Low down payment

Answer 3

C: $900 monthly loan payment

Question 4

When a person has suffered a violation of the Fair Housing Law they have ______ months to file a claim.

A: 6
B: 3
C: 12
D: 24

Answer 4

C: 12

Question 5

What does not apply to the income approach of appraising?

A: Schedule gross income
B: Vacancy and loss of credit
C: property depreciation
D: net operating income

Answer 5

C: property depreciation

Question 6

The effective rate of interest is best described as:

A: legal rate
B: rate minus MIP insurance
C: simple interest
D: Annual percentage rate

Answer 6

D: Annual percentage rate

Question 7

What is exempt from Fair Housing?

A: Apartment Complex
B: Four- plex listed with a real estate broker
C: Twelve- plex owner occupied
D: Four- plex owner occupied

Answer 7

D: Four- plex owner occupied

Question 8

Anti-Trust laws are enforced by:

A: Uniform Commercial Code
B: Fair Housing
C: RESPA
D: Federal Trade Commission

Answer 8

D: Federal Trade Commission

Question 9

Real Estate Settlement Procedures Act requires?

A: a three- day right to rescind
B: Disclosure of the annual percentage rate
C: Disclosure of all costs at closing
D: Disclosure of finance charges only

Answer 9

C: Disclosure of all costs at closing

Question 10

When would IRS form 1099S be used?

A: report sales price
B: to defer capital gains on a sale
C: after a foreclosure sale
D: report foreign investors

Answer 10

A: report sales price

Question 11

Which of the following is true regarding an S corporation?

A: double taxation
B: limited number of investors
C: personal liability
D: higher tax rate than a regular corporation

Answer 11

B: limited number of investors

Question 12

According to RESPA, what is the maximum amount of tax reserves a lender may impound?

A: one month
B: two months
C: three months
D: six months

Answer 12

C: three months

Question 13

When real estate is depreciated for tax purposes, it must be:

A: zoned commercial
B: improved property
C: free and clear
D: owner occupied residential

Answer 13

B: improved property

Question 14

Regulation Z would disclose:

A: title insurance fees
B: property taxes
C: loan origination fees and points
D: Escrow fees

Answer 14

C: loan origination fees and points

Question 15

What governs the reserve limit a lender may hold in a residential real estate transaction?

A: RESPA
B: Sherman Anti- Trust
C: Regulation Z
D: Fair Housing

Answer 15

A: RESPA