Legal Aspects of Real Estate

Question 1

Long established rules derived from judicial decisions founded on English law are sometimes referred to as:

a. cannon law
b. common law
c. colonial law
d. capital law

Answer 1

b

Question 2

Procedural law:

a. established and defines rights and duties
b. is really Spanish law
c. is strictly federal law
d. sets out the methods of enforcing substantive rights

Answer 2

d

Question 3

A litigant is:

a. the plaintiff
b. the defendant
c. neither a nor b
d. both a and b

Answer 3

d

Question 4

A tort is a:

a. criminal wrong
b. type of contract
c. civil wrong
d. capital offense

Answer 4

c

Question 5

Amendments to the Constitution guarantee which of the following with regards to property and the real estate profession?

a. Due process
b. Equal protection
c. Just compensation
d. All of the above

Answer 5

d

Question 6

The laws adopted by Congress and the state legislatures are called:

a. ordinances
b. articles
c. acts or statutes
d. bills

Answer 6

c

Question 7

A proposed law in Congress is called a(n):

a. a, ordinance
b. bill
c. act
d. petition

Answer 7

b

Question 8

Most legislation becomes effective:

a. within 30 days of adoption
b. December 31 of the same year
c. immediately
d. January 1 of the next year

Answer 8

d

Question 9

The rules of law developed by judges are called:

a. tort law
b. judicial law
c. case law
d. code law

Answer 9

c

Question 10

A court decision may be binding on all other judges. It depends on:

a. jurisdiction
b. position in the court hierarchy
c. a written opinion
d. all of the above

Answer 10

d

Question 11

An opinion written by a court states:

a. the decision
b. the facts of the case
c. the court’s reasoning
d. all of the above

Answer 11

d

Question 12

An appellate court will NOT change a trial court’s decision if:

a. the judge committed an error
b. the losing party considered the jury incompetent
c. the error concerned a question of law
d. the error was prejudicial

Answer 12

b

Question 13

A case will NOT necessarily be heard in state court if:

a. no federal question is present
b. there is no diversity of citizenship
c. the U.S. government is a party
d. it involves real property issues

Answer 13

c

Question 14

Litigants are able to find out more about the disputed facts in a case through:

a. the discovery process
b. settlement negotiations
c. a summons and complaint
d. the trial proceedings

Answer 14

a

Question 15

The oldest method of describing land is:

a. government survey
b. lot and block
c. metes and bounds
d. sections and township

Answer 15

c

Question 16

The starting point of a metes and bounds description is called the:

a. starting point
b. point of beginning
c. beginning point
d. origination point

Answer 16

b

Question 17

The government survey system is also called the:

a. rectangular survey method
b. principal meridian method
c. base line method
d. square survey method

Answer 17

a

Question 18

Which of the following lines do NOT run east and west?

a. Principal meridians
b. Base lines
c. Correction lines
d. Township lines

Answer 18

a

Question 19

The square of land located at the intersection of a range and township tier is called a:

a. government lot
b. subdivision plat
c. township
d. range lot

Answer 19

c

Question 20

Irregular sections are called:

a. odd township
b. government lots
c. convergence ranges
d. surveying lots

Answer 20

b

Question 21

Many final subdivision maps include which of the following?

a. Measurements of area
b. Easement locations and dimensions
c. Location of survey markers
d. All of the above

Answer 21

d

Question 22

A bench mark is a(n):

a. position where a bench is located
b. marker that states the location relative to the datum
c. artificial horizontal plane of elevation
d. none of the above

Answer 22

b

Question 23

Natural attachments that are planted and cultivated are called:

a. fructus naturales
b. fructus plantas
c. fructus humungus
d. fructus industriales

Answer 23

d

Question 24

Which of the following is NOT a test for a fixture?

a. Method of attachment
b. Age of the fixture
c. Adaptation to the realty
d. Relationship of the parties

Answer 24

b

Question 25

Fixture installed for use in a tenant’s business are called:

a. real property fixtures
b. business fixtures
c. trade fixtures
d. operation fixtures

Answer 25

c

Question 26

Which of the following is a water right?

a. Riparian
b. Overlying
c. Appropriative
d. All of the above

Answer 26

d

Question 27

The fact that a property owner who drills a well on his or her land owns all of the oil and gas the well produces, falls under the:

a. law of private withdrawal
b. 1922 Bureau of Mines law
c. riparian rights law
d. rule of capture

Answer 27

d

Question 28

Support from adjacent land is called:

a. lateral support
b. subjacent support
c. horizontal support
d. alluvial support

Answer 28

a

Question 29

A fee simple estate is:

a. inheritable
b. transferable
c. perpetual
d. all of the above

Answer 29

d

Question 30

The duration of a life estate is based on:

a. the laws of the county in which the property is located
b. the length of someone’s life
c. established state laws
d. the wishes of the life tenant

Answer 30

b

Question 31

A leasehold estate for a fixed time period is a(n):

a. periodic tenancy
b. estate for years
c. tenancy at will
d. none of the above

Answer 31

b

Question 32

Which of the following gives someone other than the owner a right to do something on the land or take something from the land?

a. Neutral easement
b. Restrictive easement
c. Negative easement
d. Positive easement

Answer 32

d

Question 33

The land burdened by an easement is called the:

a. servient tenement
b. dominant tenement
c. servient tenant
d. dominant tenant

Answer 33

a

Question 34

When someone creates an easement by making long and continuous use without the permission of the owner, it is called:

a. easement by prescription
b. easement at will
c. easement in gross
d. a notorious easement

Answer 34

a

Question 35

Unlike an easement, a license does NOT:

a. grant permission to enter another’s property
b. have a temporary time period
c. create an interest in the property
d. allow the owner to revoke it

Answer 35

c

Question 36

A mortgage is an example of a(n):

a. mechanic’s lien
b. performance lien
c. Involuntary lien
d. voluntary lien

Answer 36

d

Question 37

A property tax is actually a:

a. voluntary lien
b. general lien
c. specific lien
d. special lien

Answer 37

c

Question 38

Which of the following is NOT subject to property taxes?

a. Federal property
b. State property
c. Educational property
d. All of the above

Answer 38

d

Question 39

The tax on a parcel of real estate is calculated by multiplying the tax rate by the :

a. gross domestic product
b. assessed (taxable) value
c. consumer price index
d. county sales tax rate

Answer 39

b

Question 40

The first installment on property taxes is delinquent of not paid by:

a. 5PM on April 10
b. 5PM on November 1
c. 5PM on December 10
d. 5PM on June 1

Answer 40

c

Question 41

A state tax lien would be junior to the recorded interest of a:

a. mortgage or trust deed lender
b. mechanic’s lien holder
c. judgment lien creditor
d. all of the above

Answer 41

d

Question 42

A declared homestead exemption is established by:

a. signing a promissory note
b. recording a declaration of homestead
c. running a 3-day notice in a paper of general circulation
d. posting an 8 x 10 sign on the homesteaded property

Answer 42

b

Question 43

The most basic form of concurrent ownership is:

a. tenancy in common
b. severalty
c. joint tenancy
d. community property

Answer 43

a

Question 44

A tenant in common is free to:

a. sell his or her interest
b. will his or her interest
c. encumber his or her interest
d. any of the above

Answer 44

d

Question 45

Joint tenancy requires unity of possession and:

a. unity of interest
b. unity of time
c. unity of title
d. all of the above

Answer 45

d

Question 46

Severance, with regards to joint tenancy:

a. terminates co-ownership
b. eliminates the right of survivorship
c. changes joint tenancy into a partnership
d. is the same as partition

Answer 46

b

Question 47

A form of co-ownership that can only be held by spouses and registered domestic partners is called:

a. community property
b. joint tenancy
c. tenancy in common
d. tenancy in partnership

Answer 47

a

Question 48

One spouse can’t give away community property without the other’s consent. This falls under the:

a. joint spousal requirement
b. unilateral requirements
c. rejoinder requirements
d. joinder requirements

Answer 48

d

Question 49

If a spouse with two children dies intestate, the deceased spouse’s interest in the community property will be distributed with:

a. all of the going to the surviving spouse
b. two-thirds going to the spouse; one-third to the children
c. one-third to the spouse; two-thirds to the children
d. one-half to the spouse; one-half to the children

Answer 49

a

Question 50

When a couple changes a joint tenancy agreement to community property, it is called a(n):

a. intra-property agreement
b. transmutation agreement
c. co-ownership transformation agreement
d. spousal property change agreement

Answer 50

b

Question 51

A corporation organized under the laws of another state is a:

a. foreign corporation
b. domestic corporation
c. Sovereign corporation
d. limited corporation

Answer 51

a

Question 52

With a general partnership, the liability for debts of the partnership lies with:

a. the stockholders
b. the chief general partner
c. each individual partner
d. the limited partner

Answer 52

c

Question 53

To transact business using a partnership name, the partners must publish and record a:

a. fictitious business name certificate
b. notice of “in business” certificate
c. business license
d. partnership name agreement

Answer 53

a

Question 54

With a limited partnership:

a. the general partners have limited liability
b. the general and limited partners have equal liability
c. the stockholders have main liability
d. the limited partners have limited liability

Answer 54

d

Question 55

_ is the minimum number of investors that a real estate investment trust (REIT) must have?

a. 50
b. 100
c. 150
d. 200

Answer 55

b

Question 56

Which of the following describes an arrangement where the buyers purchase the exclusive right to possession of the property for specified periods each year?

a. A syndicate
b. A common interest development
c. A community apartment project
d. A timeshare

Answer 56

d

Question 57

Authority intentionally given by the principal to an agent is called:

a. actual authority
b. ostensible authority
c. direct authority
d. intentional authority

Answer 57

a

Question 58

A real estate agent/broker with authority limited to the single transaction of selling a particular house is a:

a. secret agent
b. probationary agent
c. general agent
d. special agent

Answer 58

d

Question 59

A agency may be created by:

a. express agreement
b. ratification
c. estoppel
d. all of the above

Answer 59

d

Question 60

When a person acts on another’s behalf without agency authorization, and later the principal approves these actions, it is known as:

a. estoppel
b. ratification
c. approval in remainder
d. blind authority

Answer 60

b

Question 61

With an independent contractor:

a. he or she does not work hours set by the employer
b. minimum wage laws apply
c. the employer is responsible for any tort committed by the contractor
d. he or she must follow the employer’s instructions to the letter

Answer 61

a

Question 62

If a cooperating broker is the procuring cause in bringing about the sale of the property, who pays him or her a share of the commission?

a. The listing broker
b. The buying broker
c. The listing salesperson
d. None of the above

Answer 62

a

Question 63

An agency is terminated by operation of law if:

a. either party dies
b. either party goes bankrupt
c. the agent loses his or her license
d. any of the above

Answer 63

d

Question 64

A unilateral termination of the agency relationship by the principal would be achieved through:

a. revocation
b. renunciation
c. mutual agreement
d. operation of law

Answer 64

a

Question 65

Which of the following does NOT require a real estate license to represent another in a specific real estate transaction?

a. Attorney
b. Trustee
c. Executor
d. Any of the above

Answer 65

d

Question 66

A real estate license must be renewed:

a. every year
b. every 2 years
c. every 4 years
d. every 6 years

Answer 66

c

Question 67

A broker must keep records of each transaction for at least three years beginning:

a. from the closing date
b. from the date escrow instruction were signed
c. from the listing date, if the transaction was complete
d. none of the above

Answer 67

a

Question 68

With few exceptions, a California broker’s client trust account must be maintained at a financial institution:

a. in the broker’s city
b. in California
c. within 20 miles of the broker’s main office
d. anywhere in the United States

Answer 68

b

Question 69

In a listing agreement for the sale of four or less residential units, a broker’s commission must:

a. exceed 5.25 percent
b. be preprinted in a standard listing agreement form
c. be negotiable between the seller and the broker
d. all of the above

Answer 69

c

Question 70

A buyer is considered “able” if he or she has which of the following?

a. Enough cash to complete the sale
b. A strong credit rating and adequate personal assets
c. A binding commitment for a loan to finance the purchase
d. Any of the above

Answer 70

d

Question 71

The agency disclosure form is NOT required for the sale of a:

a. condominium unit
b. residential house
c. commercial property
d. manufactured home

Answer 71

c

Question 72

An agent owes his or her principal the basic fiduciary duty of:

a. reasonable care and skill
b. diligence, good fait, and loyalty
c. disclosure of material information
d. all of the above

Answer 72

d

Question 73

A real estate agent representing a seller should be especially careful to inform the principal of:

a. the true value of the property
b. all offers to purchase
c. the identity of the purchaser
d. all of the above

Answer 73

d

Question 74

When a broker exaggerates the market value of the property in order to get a listing, he or she breaches his or her duty to:

a. act in good faith
b. act loyalty
c. act with reasonable care and skill
d. act with confidentiality

Answer 74

a

Question 75

When the agent buys a property for himself or herself (without the owner’s knowledge) and then sells it again for a profit, it is called:

a. self-profit
b. self-dealing
c. self- serving negotiations
d. self-indulgence buying

Answer 75

b

Question 76

Which of the following is NOT an agent’s duty to a third party?

a. Good faith
b. Fair dealing
c. Fiduciary relationship
d. Disclosure of known material facts

Answer 76

c

Question 77

The transfer disclosure statement is usually signed by the:

a. seller
b. listing agent
c. selling agent
d. all of the above

Answer 77

d

Question 78

Actual fraud involves:

a. intentional misrepresentation
b. concealment
c. negligent misrepresentation
d. any of the above

Answer 78

d

Question 79

Generally. a seller or agent can’t be sued for misrepresentation if his or her statements were merely:

a. opinions
b. predictions
c. puffing
d. any of the above

Answer 79

d

Question 80

The most widely recognized code of ethics in the real estate industry is the:

a. NAR code of Ethics
b. CAR code of Ethics
c. DAR code of Ethics
d. DRE code of Ethics

Answer 80

a

Question 81

A breach of a legal duty may result in all of the following, except:

a. compensatory damages
b. beneficial damages
c. punitive damages
d. criminal prosecution

Answer 81

b

Question 82

Where damages are concerned, the closest word to “compensatory” is:

a. excessive
b. punitive
c. actual
d. exemplary

Answer 82

c

Question 83

A client who is awarded damages against a real estate agent cased on fraud, but is unable to collect, may be entitled to payment out of the:

a. Real Estate Commissioner’s Special Fraud
b. Real Estate Collection Account
c. Real Estate General Account
d. Real Estate Recovery Account

Answer 83

d

Question 84

A payment from the Real Estate Recovery Fund must be based on a judgment against a real estate agent for:

a. intentional fraud
b. misrepresentation or deceit
c. conversion of trust funds
d. any of the above

Answer 84

d

Question 85

A void contract is:

a. valid unless rejected by one party
b. one where either party can sue for performance
c. no contract at all
d. binding and enforceable

Answer 85

c

Question 86

To make a valid contract, a person generally must be:

a. 14 years old
b. 16 years old
c. 18 years old
d. 21 years old

Answer 86

c

Question 87

An emancipated minor is a person under the age of 18 who:

a. is married or has been married
b. is on active duty with the armed forces
c. has received a court declaration of emancipation
d. any of the above

Answer 87

d

Question 88

For a contract to be a binding obligation, all the parties:

a. must orally present the conditions
b. must consent to its terms
c. must agree to the shortest closing period
d. must agree to maximum consideration

Answer 88

b

Question 89

Which of the following is NOT a requirement for acceptance of an offer?

a. It can only be accepted by the offeror
b. It must be communicated to the offeror
c. It must be made in the manner specified
d. It must not vary the terms of the offer

Answer 89

a

Question 90

A contractual promise is distinguished from the promise of a gift by the exchange of:

a. consideration
b. money
c. real property
d. title

Answer 90

a

Question 91

When the contract is made, the “purpose” of a contract must be:

a. enforceable
b. lawful
c. not voidable
d. reasonable

Answer 91

b

Question 92

A written contract can be modified orally:

a. if new consideration is supplied
b. if the agent agrees to it
c. even if the original contract said it must be in writing
d. whether or not the contract is subject to the statute of frauds

Answer 92

a

Question 93

When a promisor’s obligation depends on the occurrence of a particular event, that event is called a:

a. remedy
b. stipulation
c. modification
d. condition

Answer 93

d

Question 94

In California, a lawsuit based on a written contract generally must be filed no later than how many years after the breach occurred?

a. 2 years
b. 4 years
c. 6 years
d. 7 years

Answer 94

b

Question 95

For many oral contracts involving real property, any lawsuit must be filed within:

a. 2 years of the breach
b. 4 years of the breach
c. 6 years of the breach
d. 8 years of the breach

Answer 95

a

Question 96

The term “parol” most closely means:

a. intended
b. assumed
c. to free from
d. spoken

Answer 96

d

Question 97

When the parties agree in advance to set damages at a specified sum, the contract is said to contain a(n):

a. arbitration
b. liquidated damages clause
c. settlement statement
d. provisional damages clause

Answer 97

b

Question 98

A court order directing a breaching party to pay a sum of money to the nonbreaching party is called:

a. rescission
b. specific performance
c. damages (money)
d. injunction

Answer 98

c

Question 99

When the court orders a breaching party to carry out the performance he or she promised in the contract, it is called:

a. restrictive performance
b. equitable performance
c. specific performance
d. none of the above

Answer 99

c

Question 100

A court order directing a person to do something or refrain from doing something is called a(n):

a. rescission
b. specific performance
c. summary judgment
d. injunction

Answer 100

d

Question 101

An employment agreement between a seller and a broker is called a:

a. broker-seller employment agreement
b. listing agreement
c. disclosure agreement
d. representation agreement

Answer 101

b

Question 102

A listing agreement can only be assigned to another broker:

a. after it expires
b. after the first 30 days of the listing
c. with the commissioner’s consent
d. with the client’s consent

Answer 102

d

Question 103

The exclusive right to sell agency listing must contain:

a. a termination date
b. financing conditions
c. full disclosure of property defects
d. the buyer’s signature

Answer 103

a

Question 104

Which of the following makes the client liable for a commission during a specified period after the listing expires?

a. A disclosure paragraph
b. An agreement clause
c. A remainder clause
d. An extender clause

Answer 104

d

Question 105

The standard purchase agreement contains:

a. an offer to purchase real property
b. a receipt for the good faith earnest money
c. the seller’s agreement to pay listing broker’s compensation
d. all of the above

Answer 105

d

Question 106

Most agreements between buyers and sellers are:

a. conditional
b. unilateral
c. secret
d. unenforceable

Answer 106

a

Question 107

Under the compensation provision of the CAR purchase agreement, if the buyer defaults, the broker is entitled to:

a. half of the damages the buyer receives
b. half of the damages the seller receives
c. all of the damages the seller receives
d. twice the amount of damages the seller receives

Answer 107

b

Question 108

Under the compensation provision of the CAR purchase agreement, if the buyer defaults the broker is entitled to:

a. usually, the full commission agreed to
b. whatever is agreed to in arbitration
c. 10 percent of the agreed to commission
d. half of the forfeited deposit

Answer 108

d

Question 109

When an offeree varies any of the terms in an offer, it is called a:

a. substitute offer
b. counter offer
c. nuevo offer
d. propositional offer

Answer 109

b

Question 110

A contract giving one party the right to do something without obligating him or her to do it is a(n):

a. land contract
b. rental contract
c. option
d. intra-state contract

Answer 110

c

Question 111

To make an option irrevocable, the option must be supported by:

a. a signed contract
b. a property description
c. terms of the sale
d. all of the above

Answer 111

d

Question 112

Someone who has the right to buy a property only if and when the owner decides to sell it is said to hold a(n):

a. right of redemption
b. option
c. standard purchase right
d. right of first refusal

Answer 112

d

Question 113

The primary method by which conflicts are resolved is:

a. negotiation
b. arbitration
c. mediation
d. court trial

Answer 113

a

Question 114

Integrative negotiation can best be described as:

a. competitive
b. lose-win-lose
c. win-win
d. win-lose

Answer 114

c

Question 115

A neutral third party assists the parties in voluntarily negotiating a settlement to the dispute in:

a. arbitration
b. mediation
c. negotiation
d. predisponsition

Answer 115

b

Question 116

A section of a written contract that allows for mediation should a dispute arise is called a(n):

a. resolution clause
b. dispute clause
c. negotiation clause
d. mediation clause

Answer 116

d

Question 117

When a mediator meets with one of the partied to get them to focus on their interests and needs, it is called a(n):

a. forum
b. one party mediation
c. caucus
d. illegal meeting

Answer 117

c

Question 118

Generally, most arbitration proceedings are:

a. binding
b. nonbinding
c. reviewable by the courts
d. none of the above

Answer 118

a

Question 119

A court-annexed arbitration may be ordered by the superior court when there is less than:

a. $20,000 at stake
b. $30,000 at stake
c. $40,000 at stake
d. $50,000 at stake

Answer 119

d

Question 120

A binding arbitration is:

a. not reviewable by the courts
b. reviewable if judicial in nature
c. reviewable if private in nature
d. reviewable by the courts

Answer 120

a

Question 121

If no arbitration clause is in a contract, the parties can still go to arbitration by executing a(n):

a. nonbinding agreement
b. submission agreement
c. ADR agreement
d. DRE arbitration agreement

Answer 121

b

Question 122

A subpoena for books and records is called:

a. subpoena duces tecum
b. subpoena primera
c. subpoena selectus
d. subpoena suprema

Answer 122

a

Question 123

An arbitrator’s decision is called a(n):

a. declaration
b. final judgment
c. dictum
d. award

Answer 123

d

Question 124

If one party refuses to comply with the arbitration award, the other party may file with the court a:

a. strike list
b. submission agreement
c. subpoena duces tecum
d. petition to confirm

Answer 124

d

Question 125

A license hearing process to deny issuance of a real estate license is initiated by the Commissioner filing a:

a. notice of possible revocation
b. statement of facts
c. statement of issues
d. notice of license review

Answer 125

c

Question 126

A hearing procedure by the Real Estate Commissioner to suspend or revoke a real estate license is initiated with the filing of a(n):

a. statement of issues
b. accusation
c. prelim statement
d. hearing subpoena

Answer 126

b

Question 127

In reference to a deed, the owner of the property who is transferring title is called the:

a. grantor
b. grantee
c. deedor
d. testator

Answer 127

a

Question 128

When a document has been signed in front of a notary public, it is said to be:

a. recorded
b. acknowledged
c. registered
d. insured

Answer 128

b

Question 129

Acceptance of a transfer of ownership must take place:

a. in the presence of two witnesses
b. in the county where the property is located
c. within 48 hours of the offer
d. while the one granting is alive

Answer 129

d

Question 130

An important difference between a grant deed and a quitclaim deed is that the grant deed:

a. conveys after-acquired title
b. clears up clouds on title
c. is nontransferable
d. includes undisclosed encumbrances

Answer 130

a

Question 131

An amendment to a will is called a(n):

a. probate
b. devise
c. codicil
d. addendum

Answer 131

d

Question 132

A will only transfers property:

a. at the owner’s request
b. if it is witnessed
c. if it is oral
d. when the owner dies

Answer 132

c

Question 133

When property reverts to the state because no heirs can be located, it is called:

a. probate
b. escheat
c. revocation
d. alienation

Answer 133

b

Question 134

All of the following can be adversely possessed, except:

a. residential property
b. vacant land
c. public lands
d. vacation property

Answer 134

c

Question 135

In California, title can be acquired by adverse possession if the possession is:

a. actual, open. and notorious
b. hostile to the owner’s interest
c. exclusive and uninterrupted for five years
d. all of the above

Answer 135

d

Question 136

Taking away property through an eminent domain action must include:

a. a court trial
b. approval of the Commissioner
c. just compensation
d. approval of the property owner

Answer 136

c

Question 137

A person gives a gift of privately owned land to the public through:

a. private condemnation
b. severance
c. inverse condemnation
d. dedication

Answer 137

d

Question 138

When something is added to a parcel of real property, the property owner acquires title to the addition by:

a. accreditation
b. accession
c. appreciation
d. none of the above

Answer 138

b

Question 139

Notice given by the recording of documents with a public official which is something you should know about, but don’t actually know about, it called:

a. constructive notice
b. actual notice
c. due diligence notice
d. probable notice

Answer 139

a

Question 140

In Southern California, escrow services are most often provided by:

a. banks
b. independent escrow companies
c. general insurance companies
d. title insurance companies

Answer 140

b

Question 141

The most significant factor in estimating a closing date is the:

a. buyer’s financial condition
b. seller’s ability to move out on time
c. agent’s ability to handle the escrow
d. state of the finance market

Answer 141

d

Question 142

Escrow agents’ written authorization to deliver the deposited funds and documents are called the:

a. MLS instructions
b. Commissioner’s instructions
c. escrow instructions
d. none of the above

Answer 142

c

Question 143

Escrow instructions can also act as a(n):

a. contract of sale
b. listing agreement
c. disclosure statement
d. inspection report

Answer 143

a

Question 144

When title passes on the date the deed or funds were deposited in escrow, instead of the date all conditions were performed, it is known as:

a. the doctrine of first in, first out
b. conversion
c. the doctrine of relation back
d. an interpleader action

Answer 144

c

Question 145

The escrow agent turns the escrow funds over to the court to settle a dispute in a(n):

a. relation back action
b. interpleader action
c. conversion action
d. none of the above

Answer 145

b

Question 146

A credit is a(n):

a. lender’s charge
b. escrow officer’s charge
c. amount owned
d. amount received

Answer 146

d

Question 147

Which is NOT a RESPA required?

a. The loan applicant must receive the Settlement Procedures and You booklet
b. The lender may pay referral fees to anyone
c. The lender must give a good faith estimate of settlement costs
d. The lender must itemize all loan settlement charges

Answer 147

b

Question 148

A trust account maintained by the lender for paying property taxes and mortgage insurance premiums is a(n):

a. processing account
b. assumption account
c. impound account
d. interim account

Answer 148

c

Question 149

After the purchase price, the buyer’s second largest debit at closing is typically the:

a. assumption fee
b. processing fee
c. discount points
d. loan origination fee

Answer 149

d

Question 150

The seller’s major cost at closing is usually the:

a. title insurance
b. payoff of any existing loans
c. appraisal fee
d. loan organization fee

Answer 150

b

Question 151

Which of the following would NOT generally be charged to the buyer in escrow?

a. Hazard insurance
b. Title insurance
c. Prorated property taxes
d. The broker’s commission

Answer 151

d

Question 152

The seller’s major credit in escrow is the:

a. documentary transfer tax
b. interest on any loan
c. purchase price
d. hazard insurance

Answer 152

c

Question 153

The documentary transfer tax is ordinarily paid by the:

a. seller
b. buyer
c. lender
d. depends on the local tradition

Answer 153

a

Question 154

A standard title insurance policy covers:

a. forged deeds
b. recorded encumbrances not listed as exceptions
c. forget deeds
d. all of the above

Answer 154

d

Question 155

With a promissory note, the loan amount is called the:

a. principal
b. interest
c. due and payable clause
d. secured capital

Answer 155

a

Question 156

A promissory note that includes periodic payments of interest only is called a(n):

a. installment note
b. balloon payment note
c. straight note
d. amortized note

Answer 156

c

Question 157

The key difference between a mortgage and a trust deed is that all a trust deed:

a. must be foreclosed judicially
b. is usually foreclosed nonjudicially
c. uses a promissory note
d. creates a lien on everything that would be transferred by a deed

Answer 157

b

Question 158

A power of sale clause:

a. allows the trustor to sell the property at any time
b. empowers the beneficiary to sell the property
c. allows the trustee to sell the property in case of default
d. is not used with a deed of trust

Answer 158

c

Question 159

A document stating that the debt secured by the deed of trust has been discharged is called a:

a. promissory note
b. full reconveyance
c. partial reconveyance
d. notice of completion

Answer 159

b

Question 160

When a borrower defaults and the lender has the right to declare the entire balance due immediately, the loan has a(n):

a. default interest rate clause
b. right to collect clause
c. acceleration clause
d. demand clause

Answer 160

c

Question 161

When a new owner assumes an existing lien:

a. the new owner takes responsibility for the lien
b. the former owner is still primarily responsible for the lien
c. the former owner has no responsibility for any deficiency judgement
d. the new owner cannot lose the property to foreclosure

Answer 161

a

Question 162

To start the foreclosure process, the beneficiary asks the trustee to record a:

a. belief of abandonment
b. notice of default
c. request for notice of default
d. default judgment

Answer 162

b

Question 163

The borrower in a mortgage is called the:

a. trustor
b. mortgagor
c. trustee
d. mortgagee

Answer 163

b

Question 164

In a land contract, the buyer holds:

a. equitable title
b. legal title
c. partial title
d. no title

Answer 164

a

Question 165

The sum of all fees the lender charges a borrower in exchange for granting the loan is the:

a. equity finance charge
b. approximate finance charge
c. total finance charge
d. teaser rate

Answer 165

c

Question 166

Under the Mortgage Loan Broker Law, a disclosure statement is NOT required:

a. when the commission paid by the borrower is three percent or more
b. whenever a real estate agent negotiates a loan
c. if the lender is an institutional lender
d. none of the above

Answer 166

c

Question 167

The Act that requires all states to implement a licensing system for residential mortgage loan originators is the:

a. Mortgage Loan Originator Act
b. Nationwide Lending Act
c. FREE Act
d. SAFE Act

Answer 167

d

Question 168

The SAFE Act:

a. requires all states to implement a licensing system for residential mortgage loan originators
b. requires all states to implement a licensing system for mortgage loan brokers
c. requires all states to implement a licensing system for real estate investment counselors
d. none of the above

Answer 168

a

Question 169

In a smaller community, the city council will often act as the:

a. planning commission
b. zoning board
c. board of supervisors
d. LAFCO

Answer 169

a

Question 170

Which organization would oversee the merging between two communities?

a. MTC
b. FTC
c. LAFCO
d. ABAG

Answer 170

c

Question 171

A permit that allows an owner to build a structure or use a property in a way that isn’t otherwise allowed is called:

a. a pardoned use
b. rezoning
c. redistricting
d. a use variance

Answer 171

d

Question 172

An amendment to the zoning law is called a:

a. rezone
b. variance
c. conditional use permit
d. special exception

Answer 172

a

Question 173

Which of the following is a type of map that can only be filed for a subdivision with two-to-four lots?

a. A tentative subdivision map
b. A parcel map
c. A final map
d. A partial map

Answer 173

b

Question 174

When subdivision property in one state is offered for sale in another state, a developer may have to comply with the:

a. Common Border Map Act
b. Interstate Property Act
c. Interstate Land Sales Full Disclosure Act
d. Federal Land disclosure Act

Answer 174

c

Question 175

The National Environmental Policy Act established the:

a. EPA
b. CEQ
c. EIS
d. all of the above

Answer 175

d

Question 176

The California Law that is similar to the National Environmental Policy Act is the:

a. MIP
b. CESA
c. CEQA
d. CCA

Answer 176

c

Question 177

When private restrictions on the use of property are simple a contract between an owner and the neighboring owner, it is called a(n):

a. private covenant
b. restrictive covenant
c. non-inclusive covenant
d. illegal covenant

Answer 177

b

Question 178

A restrictive covenant may run with the land if it:

a. relates to the use of the property
b. relates to the repair, maintenance, or improvement of the property
c. directly benefits the property
d. any of the above

Answer 178

d

Question 179

The owner’s title is provisional (subject to forfeiture) when a deed contains a:

a. condition
b. restriction
c. covenant
d. prohibition

Answer 179

a

Question 180

A restrictive covenant can be terminated by:

a. expiration
b. merger
c. abandonment
d. all of the above

Answer 180

d

Question 181

Under CALGreen:

a. California became the first state to adopt a green building code
b. minimum uniform standards for green building that apply to many types of construction were established
c. developers must divert 50 percent of construction waste from landfills through recycling or re-use materials
d. all of the above

Answer 181

d

Question 182

California became the first state to adopt a green building code through:

a. CALEnergy
b. CALSmart
c. CALGreen
d. CALBuild

Answer 182

c

Question 183

Which of the following is true with regard to the Civil Rights Act of 1866?

a. It only prohibits discrimination based on race or ancestry
b. It applies to any real estate transaction
c. There are no exceptions
d. All of the above

Answer 183

d

Question 184

Title VIII of the Civil Rights Act of 1868 is commonly called the:

a. Federal Fair Housing Act
b. Civil Rights Act
c. Equal Opportunity Act
d. Equal Housing Act

Answer 184

a

Question 185

The Federal Fair Housing Act prohibits discrimination based on:

a. race
b. religion
c. familial status
d. all of the above

Answer 185

d

Question 186

Channeling prospective buyers or renters to specific neighborhoods based on their race is an example of:

a. blockbusting
b. redlining
c. race baiting
d. steering

Answer 186

d

Question 187

Refusal, for discriminatory reasons, to make loans on property in a particular neighborhood is called:

a. redlining
b. steering
c. black zoning
d. blockbusting

Answer 187

a

Question 188

Which of the following Acts applies to the extension of credit?

a. Fair Housing Act
b. Equal Credit Opportunity Act
c. National Credit Act
d. Housing Credit Act

Answer 188

b

Question 189

Which of the following is NOT a federal law or regulation designed to eliminate discrimination in lending?

a. The Fair Housing Act
b. The Civil Rights Act of 1776
c. The Equal Credit Opportunity Act
d. The Home Mortgage Disclosure Act

Answer 189

b

Question 190

The Housing Financial Discrimination Act allows:

a. a financial institution to take the fair market value of the property into consideration when deciding on a loan
b. the characteristics of a neighborhood to play a part in determining financial assistance
c. discrimination in provision of financial assistance for housing based on religion or marital status
d. a financial institution to consider the ethnic composition of a neighborhood when providing financial assistance

Answer 190

a

Question 191

Which California Act prohibits discrimination by business establishment?

a. Housing Financial Discrimination Act
b. Unruh Act
c. Fair Employment and Housing Act
d. Brown Act

Answer 191

b

Question 192

Which of the following Commissioner’s Regulations explain the duties of real estate agents in regard to unlawful discrimination?

a. 2780
b. 2781
c. 2725
d. All of the above

Answer 192

d

Question 193

Which of the following can sue for violations of anti-discrimination laws?

a. State Attorney General
b. U.S Attorney General
c. Tester
d. Any of the above

Answer 193

d

Question 194

Refusal to sell or rent after receiving a good-faith offer, if it can be shown that the offeror’s race, religion, sex, national origin, or disability was a factor, is:

a. unlawful
b. lawful
c. only a consideration if a commission is involved
d. none of the above

Answer 194

a

Question 195

Refusing to deal with someone who has sued you for discrimination may be considered:

a. good business practice
b. unlawful retaliation
c. justifiable retaliation
d. none of the above

Answer 195

b

Question 196

Who can be held liable for unlawful discrimination?

a. Seller/Landlord
b. Property manager
c. Rental agent
d. All of the above

Answer 196

d

Question 197

Which of the following is NOT a type of lease?

a. Decimal
b. Fixed
c. Graduated
d. Percentage

Answer 197

a

Question 198

A device that substitutes a lease with a new lease between a landlord and a different tenant is called a:

a. sandwich lease
b. sublease
c. novation
d. gross lease

Answer 198

c

Question 199

Under California law, which of the following are true?

a. Landlords can prohibit smoking on the property
b. Landlords are prohibited from requiring pets be declawed or devocalized
c. Both a and b are true
d. Neither a or b are true

Answer 199

c

Question 200

The landlord, to make the property tenantable, must:

a. provide effective waterproofing
b. provide plumbing and heating
c. make sure the common area is free from trash
d. all of the above

Answer 200

d