Midterm Part 2 of 3

Question 1

Personal Property Taxes on a residential closing are normally

Answer 1

SINGLE entry debit to the seller if the tax bill has been received and NOT yet paid.

A DOUBLE entry item debit seller/credit buyer if taxes are to be paid later int he year by the buyer or lender.

Question 2

The property being sold is currently being rented for $450 per month and the seller has collected the month’s rent prior to closing. The seller is holding a $300 Tenant Security Deposit to be assigned to the buyer. Appropriate entries on the closing statement would be

Answer 2

The rent will be prorated, debiting the seller and crediting the buyer with the buyer’s share

The tenant security deposit will be a DOUBLE entry of $300, debit seller/credit buyer.

Question 3

Closing takes place on June 18th and the real property taxes have NOT been paid, appropriate entries on the closing statement would be

Answer 3

Debit seller/ Credit buyer for the seller’s portion of taxes

Question 4

SELLER lose his/her right to compete for the commission

Answer 4

Exclusive right to sell listing

Question 5

NC Condominium Act

Answer 5

Public offering statement must be given to each purchaser prior to the signing of a sales contract for a residential NEW condo

Prospective purchasers deposit must be deposited and retained in a trust account until either the purchaser cancels his sales contract on a new condo or until his right to rescind the contract has passed

A purchaser of a new condo has 7 days to cancel a purchase contract.

Question 6

A contract that binds the owner of real estate to hold and offer to sell open for a set period of time, and gives the buyer the legal right to either accept or withdraw is

Answer 6

Option to Purchase Contract

Question 7

An oral real estate sales contract is unenforceable under

Answer 7

Statute of Frauds

Question 8

NOT required for a contract to be enforceable?

Answer 8

WITNESSES

Question 9

If present zoning ordinances cause a property owner undue hardship, the owner could have it changed by

Answer 9

Obtaining a VARIANCE through the Zoning Board of Adjustment

Question 10

Condensed history of title to a particular parcel of real estate, consisting of a summary of the original grant and all subsequent conveyances and encumbrances affecting the property and a certification that the history is complete and accurate

Answer 10

ABSTRACT OF TITLE

Question 11

Bob contracted with ABC Remodeling Company to remodel his home. Upon completion of the work, Bob refused to pay. ABC Remodeling may

Answer 11

Attach a mechanics lien on the property within 120 days from the last day of work.

Question 12

A broker may transfer earnest money deposits to the closing attorney no more than

Answer 12

10 Calendar days prior to the anticipated closing date

Question 13

Recorded notice that a legal action as commenced against the property owner of the land

Answer 13

LIS PENDENS

Question 14

NON ESSENTIAL element of a deed

Answer 14

Acknowledgement

Question 15

Jill rents and empty building to use an ice cream parlor. She installs a large freezer unit and builds several service counters. These additions

Answer 15

can be referred to as a trade fixture or chattel fixture

be removed prior to the expiration of the lease and the unit is to be restored to original condition

Question 16

NC Timeshare Act of 1984

Answer 16

Purchaser of a timeshare has the right to cancel the purchase contract for any reason during the five days immediately following the date he signed the purchase contract

All deposits made by a purchaser of a timeshare must be deposited in a trust account by the developer or agent no later than three banking days following receipt. The deposit must remain int he trust account until the purchaser either cancels his purchase contract or for a period of 10 DAYS from the date of sale, whichever occurs first.

The developer or his agent must record or have recorded a timeshare instrument for each purchaser not less than 6 DAYS nor more than 45 DAYS following the date of execution of the contract of sale by the purchaser

Question 17

An agency agreement between a landlord and a Firm to procure tenants or receive rents for the landlords property may allow for

Answer 17

Automatic renewal as long as the landlord may terminate with notice at the end of any contract period and any subsequent renewals.

Question 18

If an individual sells and purchases property for themselves and is assisted by a friend who does not possess a NC real estate license this assistance is

Answer 18

LEGAL under the NCREC rules as long as the friend does not earn compensation for the assistance provided.

Question 19

Emblements

Answer 19

Annual Planting

Personal Property

Question 20

Fructus Industriales

Answer 20

Crops

Personal Property

Question 21

A life tenant may do which of the following during his life estate?

Answer 21

SELL IT

Mortgage his interest in the property

Question 22

Jones is acting as a buyers agent under a signed buyer agency agreement. Jones assists the buyer in preparing an offer to purchase which the buyer then immediately leaves town on business. Jones presents the offer to the listing agent. The seller signs the offer without any changes and Jones is notified of the acceptance at 4pm. Jones checks his voicemail messages at 5pm and discovers that the buyer left him a message at 2pm withdrawing his offer. Which of the following statements regarding this situation is true?

Answer 22

The contract became legally binding when Jones was notified of the sellers acceptance.

Question 23

Mary Smith is a BIC of Smith Realty, which has several affiliated agents. Mary is actively involved in listing and selling properties. Sue Long, a PB with Smith Realty, has a buyer client who has expressed interest in one of Mary’s listings. Which of the following agency agreements is permissible in this situation?

Answer 23

Mary and Sue may act as DUAL AGENTS and represent both parties in the same transaction

Question 24

At an open house, the seller’s agent must disclose his/her agency status to a prospective buyer

Answer 24

When the prospect begins to talk about his/her property needs and ability to purchase.