Practice Exam Flashcards
When does economic life begin?
When the improvements are constructed
What describes land and anything attached to it?
Real property
If an agent is found guilty of false advertising, what may the FTC issue?
A cease-and-desist order to stop running the ad
Where does most predatory lending occur?
The subprime market
Credit unions and commercial banks are what type of lenders?
Primary mortgage market lenders
What is a promissory note?
A contract that is a promise to pay back a loan
The Fair Housing Act protects which of these persons?
A person recovering from substance abuse
When does possession transfer in most transactions?
The day of closing
If an agent who represents the seller, gives advice to a buyer regarding an offering price, what type of agency would it create?
Undisclosed dual agency
What is a comparison of the prices of similar properties that have recently sold, similar properties currently on the market, and properties that have not sold called?
A CMA
Loan novation is a form of:
assumption and assignment.
In contract terms, the exchange of something of value is called:
consideration.
Within what how many days after receiving a complaint will HUD determine if there is reasonable cause to charge discrimination?
100
What tax was eliminated on small businesses due to the Taxpayer Relief Act?
The alternate minimum tax
What is a one page document that is used to update or make changes to the Seller’s Property Disclosure Statement?
The Seller’s Property Disclosure Statement Addendum
One example of discrimination in lending is:
discriminating in a property appraisal.
What is a good faith gesture that shows the seller that the buyer is serious about the offer and intends to carry out the terms of the contract?
The earnest money deposit
Who provides detailed information about identifying consumer issues?
The Office of Pennsylvania’s Attorney General
What is the payment schedule for most mortgage loans?
Mortgage loans are paid in arrears.
Before an agent makes contact with a FSBO he or she should:
check the Do Not Call list.
What are two types of breach of contract damages?
Loss of bargain damages and special damages
Who works on behalf of landlords and property management companies to collect rent and provide customer service for renters and tenants?
A leasing consultant
In what type of residential building does each owner have a percentage of ownership of the entire property?
A condominium
When must cooperating brokers determine their compensation terms?
They must determine compensation before beginning efforts to accept the offer of cooperation.
According to the CAN-SPAM Act, commercial e-mailers must reveal the identity of the sender and:
the name of the advertiser entity.
What happens when an agent intentionally fails to reveal a material fact?
Silent misrepresentation
Exclusionary discrimination is typically:
subtle.
What is a legal remedy intended to mitigate or correct an ethical issue?
A government regulation
What is the only federal grant program with the sole purpose of helping private organizations prevent and address housing discrimination issues?
The Fair Housing Initiatives Program
What section of the Seller’s Property Disclosure discusses defects in flooring?
Structural Items
What is another term given to savings and loan associations?
Savings banks
What document itemizes the real estate taxes on a home and whether any taxes are due or are paid in full?
A tax cert
Properties that have existing easements could be viewed as:
less desirable.
What covenant assures that the grantor owns the estate to be conveyed and has the right to do so?
The covenant of seizen
According to Freddie Mac guidelines, funds from gifts may be used as all or part of the 20% down payment. However, Freddie Mac requires a minimum 5 percent borrower contribution if the down payment is less than:
20%.
The two types of municipal bonds are general obligation (GO) bonds and:
revenue bonds.
What do you call an individual broker who is employed by another broker?
An associate broker
What type of negotiation skills training is offered by the National Association of REALTORS®?
The Real Estate Negotiation Expert certification
Compensation that a broker receives is generally revealed in a listing agreement, a buyer’s agency agreement or:
a management agreement.
What function does the Federal Housing Administration (FHA) play in the mortgage loan process?
FHA insure loans.
What causes population shifts away from or toward a certain locale?
Area preference
What is it called when another lender buys a mortgage loan?
An assignment
Individuals and business organizations whose sole enterprise is performing a real estate-related service or function are called:
real estate professionals.
What should a broker consider if a seller insists on an exaggerated listing price?
Refusing the listing
Since the Department of Veterans Affairs (DVA) lenders are now protected in the event of a default by the borrower, lenders have agreed to loan:
four times the current DVA Entitlement.
A market study is made to find those comparable sales and listings that are what?
Similar to the property being appraised
What the market recognizes as “the change in value an improvement makes to a property” is called what?
Contribution
Silence often conveys a sense of:
control and power.
Flood insurance protects the owner from damage caused by:
floods or tidal waves.
When a buyer makes payments on a mortgage the amount going to interest decreases and the amount going to the principal:
increases.
How are salespersons, who are independent contractors paid?
By the job
An underwriting red flag occurs when there is a gift letter without:
any bank statements to back it up.
What is an area of commercial law that deals with a set of contractual, quasi-contractual and non-contractual fiduciary relationships involving an agent and a principal to create legal relations with a third party?
The law of agency
When evaluating a credit report, what do lenders typically use to determine if a borrower will qualify for a loan?
Qualifying ratios
A breached contract is a(n):
broken contract.
Who is responsible for the actions of real estate agents?
The broker
What type of survey gives the estimated location of a home and improvements on the lot, with the accuracy of plus or minus one foot?
Spot
When a home is listed, typically demand and interest fade after:
three or four weeks.
What do parties create when they have no formal agency relationship but develop one through actions?
Implied agency
What does Entitlement refer to in a Department of Veterans Affairs loan?
The maximum number of dollars that DVA will pay if the lender suffers a loss
A listing presentation should cover your skills and expertise as well as:
that of your firm.
What type of loan could be a wise choice for someone who plans to own the property for a short time and believes the property will appreciate during that time?
Interest-only loan
Agent Mary had an ethics complaint filed against her by a buyer with whom she had a buyer’s agreement. An article was cited in the violation, along with a supporting Standard of Practice. Mary could be found:
in violation of the associated Article.
What instrument does a trustee use to reconvey title back to the borrower?
Deed of Reconveyance
An arrangement that requires the buyer to agree to something in exchange for the sale is called:
a tie-in arrangement.
Units of demand, by property classification are residential, agricultural, commercial, and:
industrial.
If product price increases, demand is increasing in relation to:
supply.
Contract law states that a material breach of contract is a(n):
irreparable break in a legally binding contract.
What is the position regarding the offering of premiums, prizes, or merchandise to list a property?
It is unethical.
What section of the Buyer Agency Contract states that the contract is self-inclusive and any changes must be in writing and approved by all parties?
Entire Contract
What is the longest period a listing contract can last?
1 year
A broker price opinion must include what the price was based on and:
applicable market data.
Which appraisal approach is a means of appraising a property based on the assumption that value is equal to the present worth of future rights to income?
Income
The final step a licensee will take when preparing a CMA is:
estimating a reasonable selling price range.
Mediation is often used to avoid
taking a case to court.
