Progress Exam 1

Question 1

the major intent of zoning regulations is to

Answer 1

ensure the health, safety and welfare of the community

Question 2

Company built a hangar for a helicopter and it was kept on the owner’s property, but the owner did not pay for the hangar so the company filed a mechanic’s lien on the helicopter. Was the company justified in doing this?

Answer 2

no, because a mechanic’s lien can only be placed on the improvement

Question 3

The tax rate in a county is 35 mills. How much is this for every $1,000 of assessed value?

Answer 3

1 mill = $.0001
$1 for every $1,000
35 mills = $35

Question 4

The system established in 1785 by the US government, which describes land with principal meridians and base lines is called

Answer 4

rectangular survey system

Question 5

Real Estate Tower has retail space, office space, and residential space. What type of development is it?

Answer 5

mixed-use

Question 6

When a listing on a residential property is signed, what type of agency relationship is usually created?

Answer 6

special agency

Question 7

if a borrower must pay $6,000 for points on a $150,000 loan, how many points is the lender charging for this loan?

Answer 7

$6,000 / $150,000 = .04 = 4 points

Question 8

The seller under a land contract is AKA

Answer 8

vendor

Question 9

A farmer is selling 2 parcels of land - 1 is 1 SQ mile and the other is 5 acres. The sale price is $2,100/acre. What is the selling price of the property?

Answer 9

1 SQ mile = 640 acres
640 + 5 = 645 acres
645 acres x $2,100 = $1,345,500

Question 10

What is the principal federal statue that covers competition and is one of the most important pieces of antitrust legislation?

Answer 10

Sherman Antitrust Act of 1890

Question 11

A trust deed gives the lender a right to request that the trustee perform certain tasks in order to fulfill the terms of the trust. The trustee may take action in those circumstances because they hold

Answer 11

naked title

Question 12

Sydney manages an office building with leases of $60,000/year and her management agreement is for 7 years: year 1 at 7%, years 2 and 3 at 5% and 3% for the remaining years. What will be her total management fee?

Answer 12

year 1 = $60,000 x 7% = $4,200

years 2 and 3 = $60,000 x 5% = $3,000 x 2 years = $6,000

years 4-7 = $60,000 x 3% = $1,800 x 4 years = $7,200

$4,200 + $6,000 + $7,200 = $17,400

Question 13

loan company was referring loan applicants to a particular insurance company, which in return paid the loan company a referral fee. This is

Answer 13

illegal, since the real estate settlement procedures act prohibits kickbacks

Question 14

What would MOST likely be enforced by the forced sale of a property?

Answer 14

judgement

Question 15

a point, line, or surface from which elevations are measured is known as the

Answer 15

datum

Question 16

a 3-year straight note was obtained at 10%/year. Interest paid the first 2 years was $42,000. The loan on the house was 75% of the value. What was the total value of the property?

Answer 16

Year 1 = $21,000
Year 2 = $21,000

at 10% = $210,000 principal balance

$210,000 / 75% = $280,000 total value

Question 17

Current value of a property is $40,000 and it is assessed at 40% of its current value, with an equalization factor of 1.5 applied to the assessed value. If the tax rate is $4 per $100 of assessed, what is the amount of tax due on the property?

Answer 17

$40,000 x .40 = $16,000
$16,000 x 1.5 = $24,000
$24,000 / 100 = 240
240 x 4 =$960

Question 18

A person who dies without leaving a will is known as having died

Answer 18

intestate

Question 19

If a mortgage loan is 80% of the appraised value of a house and the interest rate of 8% amounts to $460 for the 1st month, then what is the appraised value of the home?

Answer 19

$460 x 12 months = $5,520 year
$5,520 / 8% = $69,000 loan
$69,000 / 80% = $86,250 value

Question 20

an owner of a 12-unit apartment lived in one of the apartments. The owner refused to rent to a person because of their national origin. Based on Federal Fair Housing Laws, foes the prospective tenant have a valid complaint?

Answer 20

Yes because it was a 12-unit apartment building

Question 21

a lending institution will allow its borrowers to spend 28% of their income for housing expenses. What will be the max monthly payment allowed for a family with an annual income of $57,000 and no other debt?

Answer 21

$57,000 / 12 months = $4,750 monthly

$4,750 x 28% = $1,330

Question 22

a buyer is applying for an FHA mortgage on a house priced at $108,000 and the max LTV ratio is 97.75. What is the min down payment?

Answer 22

$108,000 x 97.75% = $105,570

$108,000 - $105,750 = $2,430

Question 23

Broker has a listing agreement with a seller. One of the broker’s salespeople commits a license law violation while interacting with the seller. The broker

Answer 23

could be responsible due to vicarious liability

Question 24

a straight note for $13,400 with 8% annual interest. If the borrower actually paid $3,754 in interest, how many months did they take to pay it off?

Answer 24

$13,400 x 8% = $1,072 per year or $89.33 per month

$3,752 / 89.33 = 42 months

Question 25

Property owner does not like how much they pay in property taxes. What can they object to and have a change of winning?

Answer 25

the assessed value of the property

Question 26

What is the cap rate on a building that is worth $430,000 and rents for $1,500 per month?

Answer 26

$1,500 x 12 months = $18,000 annually

$18,000 / $430,000 = 4.19%

Question 27

A section is

Answer 27

one square mile

Question 28

Kate secures a loan with a 75% LTV ratio. The interest rate was 7.125% and the term was 30 years. The first month’s interest payment was $477.82. What was the appraised value of the property?

Answer 28

$477.82 x 12 months = $5,733.84 annually
$5,733.84 / 7.125% = $80,475
$80,475 / 75% = $107,300

Question 29

Broker represents a party in a transaction where there is a dispute regarding escrow money. What should the broker do?

Answer 29

hold the money until both parties (or lawyers) provide a written release

Question 30

If a house was sold for $40,000 and the buyer obtained a FHA-insured mortgage loan for $38,500 how much money would the buyer pay in discount points if the lender charged 4 points?

Answer 30

4 points = 4%

$38,500 x 4% = $1,540

Question 31

Redlining deals with the conduct of

Answer 31

lending institutions

Question 32

To have an outstanding debt satisfied through the sale of a debtor’s property, what legal element may be required?

Answer 32

writ of execution

Question 33

Property owner which an easement runs in favor of another parcel of real estate is known as

Answer 33

servient tenement

Question 34

brokerage was paid a commission of 6% of the first $120,000 of the sale price and 4% of everything $120,000+. What would be the sale price if the total commission was $9,000?

Answer 34

$120,000 x 6% = $7,200
$9,000 - $7,200 = $1,800
$1,800 / 4% = $45,000
$120,000 + $45,000 = $165,000

Question 35

earnest money is provided when?

Answer 35

the offer to purchase real estate is made

Question 36

a lease that goes from month to month is known as

Answer 36

an estate from period to period

Question 37

a property was assessed at 25% of value with a tax rate of $12 per hundred. If the taxes totaled $11,400 what was the value?

Answer 37

$11,400 / $12 = $950
$950 x $100 = $95,000
$95,000 = 25% of the value
$95,000 / 25% = $380,000

Question 38

an action taken by a creditor in which the court simply retains custody of the priority while a lawsuit is being decided is known as

Answer 38

writ of attachment

Question 39

house sold for $350,000 and the buyer made a 20% down payment. Monthly interest on the loan was $1,400. What was the interest rate on the loan?

Answer 39

20% down = $280,000 mortgage
$1,400 x 12 months = $16,800 annual interest
$16,800 / $280,000 = 0.06 = 6%

Question 40

typically a listing broker is usually considered to be

Answer 40

a fiduciary (agent) of the seller

Question 41

Buyer negotiated for a $30,000 loan with $200 monthly payments plus 9% interest. What is the monthly interest in the 1st month?

Answer 41

$300,000 x 9% = $2,700

$2,700 / 12 mo = $225 per month

Question 42

Property is valued at $35,000 and is assessed at 40% of its value, mill levy is 8.3%. What is the annual tax on the property?

Answer 42

$35,000 x 40% = $14,000

$14,000 x 8.3% = $1,162

Question 43

a portion of a township in the rectangular survey system, which is a square with mile-long sides is called a

Answer 43

section

Question 44

Condo sold for $85,000 and is assessed at 35% of value. The tax rate is $2,70 per $100, if it increases $.35 per $100 of value, what is the new tax?

Answer 44

$85,000 x 35% = $29,750
$29,750 / 100 = $297.50
$297.50 x $3.05 ($2.70 + .35) = $907.38

Question 45

claim or interest revealed by a title search is called a

Answer 45

cloud on title