Practice Exam 4 Flashcards
A licensee must report which of the following items to the NCREC within 60 days?
a conviction for DUI
Concerning a timeshare violations in NC, which of the following is true?
a timeshare developer can be fined and a licensee can have his licensed revoked
The Interstate Land Sales Full Disclosure Act
exempts the sale of lots in a subdivision containing fewer than 25 lots
Developer must provide a property report and register the subdivision with HUD
Basic economic principle of value which states that if house A and house B are equally desirable properties with similar assets and house A is selling for $160K and house B is selling for $170K, virtually every buyer will choose house A.
SUBSTITUTION
COST
Actual amount paid
Value
aka WORTH
Anne was showing properties and while driving through a specific neighborhood told the prospective buyer that, “This is a neighborhood in which you would probably not want to live” Annes conduct would be
STEERING and illegal
Bill is managing an apartment complex which as a no pets policy. A woman with a seeing eye dog has completed an application and meets the credit and income criteria to rent a unit. Under federal fair housing law, Bill may
Rent the unit to the woman and he may NOT charge her any additional deposit for the dog
Stanley Smith is purchasing a property which is currently being utilized as a restaurant. The restaurant contains a number of trade fixtures, equipment, utensils, dishes, tables and chairs used in the business. The seller provides Stanley with a Bill of Sale for the separate transfer of all of these items. If Stanley wants to finance both the purchase of the real estate and these additional items into one loan, what type of loan should he obtain from his lender?
PACKAGE LOAN
When a lender requires mortgage insurance with a loan, and the loan is sold on the secondary mortgage market,
the mortgage insurance goes with the loan to protect all future purchases of the loan
When a home is sold “subject to an existing mortgage”,
The SELLER remains liable for the repayment of the loan unless the lender provides the seller with a separate lease.
Broker Anne obtains a listing on a property in Boone NC and she signs a Listing Contract with the seller. She later finds a buyer for the same property and agrees to represent the buyer in a written Buyer Agency Contract.
Anne is practicing DUAL AGENCY and must obtain written permission from both parties.
A broker is interested in purchasing a home. The home is listed with his/her firm.
The broker must communicate to the property owner he/she is a licensed broker.
Assignment of a contract in NC
A contract can be assigned if there is no clause prohibiting assignment
A PB runs a newspaper ad which contains willful misrepresentation. Whose license could be suspended or revoked by the NCREC ?
BIC
Provisional Broker
In a lease the COVENANT OF QUIET ENJOYMENT indicates that the landlord
warrants that no one will disturb the tenants possession of the property
In NC an UNlicensed assistant
may show rental properties in a property management office
MAY NOT show properties or hold open houses in a sales office
A firm selling its own property through the actions of its own employees
is NOT required to have a real estate license
Requires a Real Estate License
an Auctioneer of real estate
an out of state licensee who is showing properties and writing offers in NC
A licensee who manages a neighbors rental property and collects a fee
Bob a real estate broker has a listed property for sale. While in the property conducting an open house, Bob noticed that the hot water faucet was not operating properly. In regard to questions on the Residential Property Disclosure Statement, Bobs seller has checked all of the boxes with “No Representation”. When a prospective buyer expresses interest in the home what are Bob’s obligations?
Disclose the faucet issue as a material fact to his seller and he must also disclose it to any prospective buyer even if the seller objects to such disclosure
In measuring square footage in a home and the buyer has indicated it is a material fact the real estate may rely on the NCREC Residential Square Footage Guidelines and rely on the
amount of square footage that the listing agent has indicated in the MLS listing.
A corporation owns several residential properties and has placed them into an entity known as Prime Properties LLC. The corporation is not licensed by the NCREC. None of the companies salaried employees have real estate licenses. The LLC wants to sell several of its rental properties. Which of the following is correct?
The LLC may sell these properties using its own salaried employees and does not need to place any of the earnest money deposits into a trust account.
DUAL AGENCY
always requires consent and disclosure of all parties
designated agency is a form of dual agency
Dual agency will only exist when there is one firm involved
If designated agency occurs, when must the seller know the name of the designated agent working with the buyer?
At the time of first offer to purchase property
DESIGNATED AGENCY
No personal confidential information or the motivations of the parties are known by the agents being named as designated agents
A listing agent can practice designated agency with both his seller and buyer clients as long as both have consented in writing
When a purchase contract contains a provision for the release of liability of all parties to the contract should a stated event either occur or fail to occur, such a provision is considered to be
A CONTINGENCY
Who is entitled to a VA Loan.
The veteran and certain unmarried widows and widowers
George enters into an agreement to buy a farm from Jack for 350K. In the agreement, Jack requires that George put 10K down and make monthly payments to Jack at 8% interest over a 20 year period of time. The parties record the agreement and Jack promises to provide to George the DEED TO THE PROPERTY ONCE THE FINAL PAYMENT HAS BEEN MADE. This is
Contract for Deed
Under what circumstances may and ORAL BUYER AGENCY AGREEMENT exist in NC?
When the agency agreement is reduced to writing by the time of an offer
Material Fact in NC
Pending foreclosure (filing of a notice of sale)
NC Residential Property Disclosure Statement
Purchases are not required by law to sign the NC Residential Property Disclosure Statement in order to acknowledge receipt of the form
Seller and Buyer may mutually agree that the NC Residential Property Disclosure Statement is not required in that transaction
VA and FHA Loans
VA allows 100% LTV Loans
Discount Points may be charged in FHA loans and these discount points increase the lenders yield
If an FHA or VA loan is fully amortized, it means the borrower will have a constant payment amount each month through the life of the loan.
In NC if a buyer purchases a tenant occupied property investment purchase, the buyer may do which of the following?
Purchase the property subject to honoring the current lease agreement
VA LOANS
the widow of a veteran may obtain a VA loan
A non veteran may assume a VA Loan
A CRV will need to be issued before the VA loan can occur
(NOT true- if a veteran wishes to purchase an 80K laon and their Certificate of Eligibility is max of 75K the veteran may not purchase the home)
CMA Comparable Market Analysis
CMA does NOT need to be in writing
CMA is based on the principle of substitution
CMA is aka Broker Price Opinion (BPO)
(NOT true PB may receive a fee for a BPO)
Under what circumstances would a veteran receive restoration of their VA loan Benefits?
Upon full repayment of the loan or full assumption of the loan.
What is the document called that verifies both the condition of the property and the value of the property in an FHA loan?
A CONDITIONAL COMMITMENT
In regards to the payment of commissions in NC
If a broker or PB receives a listing referral or a buyer referral from another broker, the referring broker can be “INACTIVE” at the time of the referral is paid so long as they were ACTIVE AT THE TIME THE REFERRAL WAS MADE.
