Prep Agent Chapter 8-

Question 1

Failure to provide financing or insurance in certain communities based on the demographics of that community.

Answer 1

Redlining

Question 2

A 1974 federal enactment prohibiting lenders from discriminating against borrowers from a protected class.

Answer 2

Equal Credit Opportunity Act

Question 3

A private agency which collects and reports information regarding an individual’s credit history.

Answer 3

credit reporting agency

Question 4

Percentage of monthly gross income that goes towards paying debt.

Answer 4

debt-to-income (DTI) ratio

Question 5

A regulatory scheme requiring lenders to publically release loan data.

Answer 5

Home Mortgage Disclosure Act (HMDA)

Question 6

A collection of policies designed to prevent discrimination in the access to housing based on an occupant’s inclusion in a protected class.

Answer 6

Federal Fair Housing Act (FFHA)

Question 7

A building occupied or designed to be occupied as a residence by one or more families.

Answer 7

Dwelling

Question 8

A mandatory disclosure prepared by a seller and given to prospective buyers setting forth any property defects known or suspected to exist by the seller, generically called a condition of property disclosure.

Answer 8

Transfer Disclosure Statement (TDS)

Question 9

A fact that, if known, might cause a prudent buyer or seller of real estate to make a different decision regarding what price to offer or demand for a property or whether to remain in a contract or cancel it.

Answer 9

material fact

Question 10

An unenforceable provision stating the buyer accepts the property without a full disclosure of known conditions. Properties are sold “as-disclosed,” never “as-is.”

Answer 10

as-is clause

Question 11

A broker and their agents need to accurately represent the title restrictions, potential use, and any conditions, covenants and restrictions (CC&Rs) controlling real estate to a prospective buyer or tenant.

Answer 11

Disclosure of potential and future use

Question 12

The right of the government to take private property for public use on payment to the owner of the property’s fair market value.

Answer 12

eminent domain

Question 13

A broker and their agents need to advise a prospective buyer or tenant of any known material facts that may affect the value or desirability of the purchased or rented property

Answer 13

Marketability disclosure

Question 14

A worksheet used when gathering income and expenses on the operation of an income producing property, to analyze its suitability for investment.

Answer 14

Annual Property Operating Data Sheet (APOD)

Question 15

Brokers and agents are to disclose to all parties involved in a real estate transaction all significant physical aspects of a property which may affect the property’s market value or a buyer’s decision to purchase. True or false

Answer 15

True

Question 16

A provision in an agreement calling for the further approval of an event or activity by the seller, buyer or third party as a condition for further performance or the cancellation of the transaction by a person benefitting from the provision

Answer 16

further-approval contingency

Question 17

A fact that, if known, might cause a prudent buyer or seller of real estate to make a different decision regarding what price to offer or demand for a property or whether to remain in a contract or cancel it.

Answer 17

Material fact

Question 18

the buyer’s agent, a limited, non-client general duty to voluntarily provide critical factual information on the listed property, collectively called disclosures of material facts.

Answer 18

General duty to voluntarily disclose

Question 19

The information disclosed by the seller’s agent need only be sufficient enough in its content to place the buyer on notice of facts which may have an adverse effect on the property’s value or interfere with the buyer’s intended use.

Answer 19

minimal quantity of fundamental information

Question 20

That duty owed by an agent to act in the highest good faith toward the principal and not to obtain any advantage over their principal by the slightest misrepresentation, concealment, duress or undue influence.

Answer 20

fiduciary duty

Question 21

Transparency is public policy objective in California true or false

Answer 21

True

Question 22

The duty a licensee owes to non-client individuals to act honestly and in good faith with up-front disclosures of known conditions which adversely affect a property’s value.

Answer 22

general duty

Question 23

CH16: environmental hazards and annoyances

Noxious or annoying man-made conditions which are injurious to health or interfere with an individual’s sensitivities.

Answer 23

environmental hazards

Question 24

Ch 16: two types of environmental hazards

Answer 24

On property - mold, lead, smoke, security bars

Off property - military ordinance, zoning, airport influence and ground transportation