MID TERM EXAM PART 1

Question 1

Which of the following tangible items would NOT be considered real property due to its movability?

In-ground basketball goal.
A fuel tank
Antenna, satellite dishes and receivers
Outdoor plants in containers.

Answer 1

ANSWER

Question 2

Sullivan Paige obtained an exclusive right to sell listing for Carolina Realty. As a result, the seller has an agency relationship with each broker within Carolina Realty firm as a

Transactional Agency
Dual Agency
Seller subagency
Buyer subagency

Answer 2

ANSWER

Question 3

Chuck Grant from Yulee, Florida visits Asheville and decides he wants to look at a listing represented by Phillip Monroe of Coldwell Banker. Chuck informs agent Monroe that he is not represented by anyone. Therefore, agent Phillip must inform Chuck that he is representing the seller

Orally, before showing the property to Chuck in person
Orally the moment Chuck calls about seeing the property
In writing before obtaining any confidential information from Chuck
In writing before showing the property to Chuck.

Answer 3

ANSWER

Question 4

A real estate sales contract to be enforceable in a court of law must have the following item:

The receipt of Due Diligence money by the seller’s agent
The receipt Ernest Money by the Escrow Agent
It must be recorded in the county in which the contract occurred.
An exchange of consideration between the contract parties.

Answer 4

ANSWER

Question 5

Which of the following items is NOT an example of an encumbrance?

Tax property lien
Restrictive covenants
Mortgage
General Warranty Deed

Answer 5

ANSWER

Question 6

Which one of the following statements about an Oral Buyer Agency Agreement in North Carolina is True?

Allows a person to work with several brokerages while searching for property.
Allows a person to work with only one brokerage at a time
Must be renewed every 14 days
Requires the buyer to receive a copy of the Working with Real Estate Agents brochure only if they wish to make an offer on a property

Answer 6

ANSWER

Question 7

The remedy of specific performance within a real estate contract allows for

The injured party to receive full damage compensation making them whole
Enforcement of the buyer’s right to purchase the property per contract terms.
Allows the parties involved the right of rescission based upon the nonperformance of the terms within the contract.
Sets a time limit for the terms within the contract to be fully executed.

Answer 7

ANSWER

Question 8

A written listing agreement generally includes:

The heated square footage of the property
The guarantee that a broker will sell the property by a set time limit
An automatic termination date
The buyer’s obligations when purchasing the property.

Answer 8

ANSWER

Question 9

An exclusive buyer’s agency agreement with a firm will be automatically terminated if the

(A). Individual buyer-agent dies.
(B). Buyer and the firm agree to stop working together.
(C). Buyer closes the sale of their currently owned property.
(D). Property on which the buyer has made an offer is destroyed.

Answer 9

ANSWER

Question 10

An estate in real property may be BEST defined as

A taxable interest in land with or without improvements
The extent or degree of a person’s interest in real property
A large parcel with permanent structures that has been inherited
The total amount of real property that an individual owns in severalty.

Answer 10

ANSWER

Question 11

John, Paul, and George own property in Florida as joint tenants. They are married and have children. John died; however, he had willed his portion to his children, Julian and Sean.
Which of the following BEST describes the ownership of the property after John’s estate has been settled?

Paul and George own the property as joint tenants.
Julian and Sean own the property as joint tenants with Paul and George
Paul and George own the property as tenants in common
Julian, Sean, and Yoko (John’s wife) own the property as tenants in common with Paul and George.

Answer 11

ANSWER

Question 12

Phillip Monroe owns 283 Jim’s Branch Road in Swannanoa, NC. He grants a written easement across his property to Mr. Kingston who owns the parcel directly behind him. Mr. Monroe has recorded the easement within Buncombe County. Five years later, Phillip decides to sell his property to the Edwards family. Is it possible for the Edwards family to legally stop Mr. Kingston from using the easement?

No because of the concept of Eminent Domain
Yes, because the Edwards family did not consent to the use of the easement during the execution of the purchase contract.
No because the easement is appurtenant to the property
Yes, because Mr. Kingston did not sign the original easement agreement.

Answer 12

ANSWER

Question 13

Steve’s split rail fence extends over the property line of Gordon Ball’s. This legally constitutes.

Encroachment.
Appurtenance
Variance
Extra territorial zoning allowance

Answer 13

ANSWER

Question 14

Which of the following would create legally binding acceptance of a written offer?

 The buyer’s agent told the seller that the buyer will initial and sign the counteroffer that evening. 
A spouse signs for his/her spouse based on marital rights.
The seller’s agent emails the buyer’s agent that the seller signed the offer as written.     The buyer submits a good faith deposit to the seller.

Answer 14

ANSWER

Question 15

The legal description that is used most commonly in describing property in urban areas is called the:

Metes and Bounds description
Rectangular Government Survey System
Reference to a Recorded Plat (Lot/Block)
Urban Plat (Lot/Block)

Answer 15

ANSWER

Question 16

The form of legal description used that uses a Point of Beginning, Monuments, and Calls is known as the

Metes and Bounds description
Rectangular Government Survey System
Reference to a recorded Plat (Lot/Block)
Urban Plot (Lot/Block)

Answer 16

ANSWER

Question 17

If a parcel of land is bordered by a small stream then the property line would be
At the mean high water mark
At the edge of the stream
At the 3 feet mark before the stream itself
At the center of the stream.

Answer 17

ANSWER

Question 18

Which of the following would NOT be considered in determining if an item is a fixture?

Intent
Adaptability
Value
Method of Attachment

Answer 18

ANSWER

Question 19

Which of the following essential elements are necessary for having a valid deed?

Must be recorded with the county in which the property exists.
Must be signed by the grantee and grantor
The deed must be voluntarily accepted by the grantor
The grantee must be identified within the deed.

Answer 19

ANSWER

Question 20

David Rodgers has owned a small engines repair shop in Mountain Home, NC since the late 1980’s. Due to rapid growth in Henderson County, the county zoning commission voted in favor of changing several zoning areas. As a result, Rodgers’ Machine Shop will now reside within a residential zone. What will happen to David’s small engine repair shop?

He will be given 120 days to abandon the property so the county can demolish the building paving the way for more residential properties.

The county will pay him market price for property through the concept of Eminent Domain.

Nothing will happen, he has the legal right of nonconforming use to continue operating his machine shop.

He must apply for a variance with the county commission board.

Answer 20

ANSWER

Question 21

Callie Wright has an Exclusive Right to Sell listing contract with the Pandora family. While on desk duty, a prospective buyer asks her to show him the property. He really likes the home; however, he feels that the listing price is too much. Therefore, he asks Ms. Wright if the sellers would consider taking less than what they are asking. Agent Callie has knowledge that the Pandora family is indeed quite anxious to sell their property so they can move to Florida to be closer to family. Therefore, agent Callie suggests to the prospective buyer that he should offer $5,000 less than the listing price. In this scenario, Agent Wright

Is now performing an unauthorized dual agency
Has violated her fiduciary duties to the Pandora family
Is in full violation of agency law by possibly securing a secret commission.
Has not violated anything by offering simple advice to a customer.

Answer 21

ANSWER

Question 22

Which of the following statements about dual agency is/are correct?

Dual agency can occur within one firm if a broker has become a buyer’s agent and is showing a property listed by the broker-in-charge.

Dual agency can occur within one firm if a broker shows his buyer-client his or her own listing.

I only
II only
Both I and II
Neither I nor II

Answer 22

ANSWER

Question 23

Which of the following scenarios would be considered a material fact that a seller would have to disclose on the Residential Property and Owner’s Association Disclosure Form in NC?

There is a mold growing in the basement due to a consistent water drainage issue on the property.
The HVAC system has not been serviced in the last 10 years
Nothing
The property has an in-ground storage tank.

Answer 23

ANSWER

Question 24

Jill Jones is represented as a buyer by Lauren Polo of Blue Crab Realty. After looking at several properties, Jill decides to place an offer of $185,000 on a property that is located with the school zoning of a top-rated elementary school. She informs her agent on a Friday that is ready to present her offer to the sellers. After much discussion, the sellers accept the offer, sign it, and send it to their agent on a late Saturday night. The seller’s agent immediately informs agent Polo that their clients have accepted the offer. Agent Polo attends a dinner party that night and decides to wait until Sunday to inform the buyer that the sellers have accepted her offer. Meanwhile, Jill decides Sunday morning that she has decided to not purchase the property and informs Agent Polo that she wishes to revoke her offer. According to this scenario…

The buyer can revoke her offer because she has not signed anything.

The buyer is not considered to be under a legal binding contract because her agent has not yet presented the revocation of her offer to the sellers.

The buyer is under contract because communication of acceptance to the seller’s agent creates a legal binding contract for the buyer

The buyer is under contract because the accepted(signed) offer has been communicated to the buyer’s agent

Answer 24

ANSWER

Question 25

Mark Hines, a real estate broker for Apple Road Realty, is the listing agent for a large log cabin that sits on Lake Lure. The cabin is owned by the Scott family and is listed for $700,000 which includes a large boat dock. Dickie Miler of Charleston, SC visits the area and decides that he would like to establish brokerage representation and invest in a lake property. Mr. Miler signs an Exclusive Buyer Agency Agreement with Mark Hines and they begin the process of looking for a home. After a month, Mr. Miler informs Agent Hines that he would like to see the Scott’s log cabin. Agent Hines shows Mr. Miler the property and tells him that it’s such a nice property that the owners would probably not be willing to accept much less than the asking price. In this situation…

Agent Hines has violated state license laws by operating in an undisclosed dual agency.
Agent Hines has not violated any laws because dual agency was not established to begin with.
Agent Hines has violated state license laws because puffing the Scott’s property is an illegal activity under state license laws
Agent Hines has violated state license laws because he Mr. Miler needs a limited- nonresident license to purchase a property in NC because he lives in SC.

Answer 25

ANSWER

Question 26

Eileen Edwards decides to sell her property in Reem’s Creek, NC so she enters into a listing agreement with Beaverdam Realty. In the agreement, she gives her authorization for both dual and designated agency. Tony Cicero has a written buyer agency agreement with an agent in Beaverdam Realty. He has not authorized dual agency in the agreement because he remains suspicious about dual agency in North Carolina. He does, however, like the Edwards property and requests to see it. In this situation, what must the agent do for Mr. Cicero to see the property.

Oral consent to dual agency would be enough for Tony to see the property.
The seller has already consented to dual agency in writing therefore Tony can be shown the property.
Tony must authorize Beaverdam Realty in writing to act on his behalf as a dual agent before seeing the property.
Tony can authorize Beaverdam Realty in writing either before or after the showing.

Answer 26

ANSWER

Question 27

When a buyer and seller have entered into an installment land contract

the seller retains an interest called legal title.

the buyer acquires an immediate interest in the property known as equitable title.

I Only
II Only
Both I and II
Neither I nor II

Answer 27

ANSWER

Question 28

A contract states that closing will take place on or before April 1, 2020 and “time is of the essence.” The buyer, however, cannot close until April 21, 2020 due to their loan package not being ready by April 1.

The buyer has breached the contract
The seller can possibly terminate the contract

I Only
II Only
Both I and II
Neither I nor II.

Answer 28

ANSWER

Question 29

Which statement is TRUE regarding an oral buyer agency agreement in NC?

An oral buyer agency agreement must be exclusive.
An oral buyer agency agreement must be nonexclusive.
It must be open ended without a termination agreement.
It must include a mandatory discussion pertaining to dual and designated dual agency.

Answer 29

ANSWER

Question 30

Lennon Harrison, a buyer’s broker with Dark Horse Realty shows a property to his client. He informs his buyer that the home has reasonable utilities costs without verifying the information from the owner. After purchasing the property, the buyer finds that the home has extremely high utilities costs. The buyer could hold Agent Harrison liable for…

Negligent misrepresentation.
Willful misrepresentation
Negligent Omission
Willful Omission

Answer 30

ANSWER

Question 31

Agent Lauren was hosting floor duty for her firm on a Saturday morning when she received a call from a prospective buyer. The buyer began telling Lauren about her property desires as well as her current financial situation. In this case, the Working with Real Estate Agents brochure

Must be mailed, emailed or faxed within 5 calendar days to the prospective buyer while explaining it to them at the soonest opportunity.
Must be mailed, emailed or faxed within 3 calendar days to the prospective buyer while explaining it to then at the soonest opportunity.
Must be explained as soon as possible before the telephone call ends.
Must be explained during the phone call and then emailed within 2 calendar days to the prospective buyer.

Answer 31

ANSWER