Progress Exam 2

Question 1

Building is sold for $157,000. Brokerage divided 6% commission as follows: 10% to listing salesperson, 1/2 of the balance to the selling person. What is the listing salesperson’s commission?

Answer 1

$157,000 x 6% = $9,420

$9,420 x 10% = $942

Question 2

What is NOT an advantage of s business leasing commercial space vs buying?

Answer 2

lack of control over rent

Question 3

Borrower computed the interest charged for the previous month on his $60,000 loan balance as $412.50 what is the borrower’s interest rate?

Answer 3

$412.50 x 12 mo = $4,950 annual

$4,950 / $60,000 = 8.25%

Question 4

The federal government requires that purchasers of homes built prior to ___ be given a notice that outlines the dangers of ___

Answer 4

1978, lead poisoning

Question 5

what are the two primary types of property taxes?

Answer 5

special assessment and ad valorem

Question 6

land contract provides for the

Answer 6

conveyance of legal title at a future date

Question 7

Plumber did some work on a property and was NOT paid. He discovered that there were already several liens against the property. He then discovered that the owner had another piece of property, which was free from encumbrances. What would be true?

Answer 7

the mechanic’s lien can only be placed on the property where the work was done

Question 8

How much will the seller net after paying an 8% commission and paying expenses of $1,425 on a property that sold for $180,000?

Answer 8

$180,000 x 8% = $14,400 commission

$180,000 - $14,450 - $1,425 = $164,175

Question 9

Buyer purchases a home for $90,000 and paid $4,000 as an earnest money deposit, and is obtaining an 80% loan. Costs include $250 for title insurance, recording fees of $60, and a tax proration fee of $430. The buyer will need to bring a check of how much to closing?

Answer 9

$250 + $60 + $430 = $740 fees
$90,000 x 80% = $72,000
$90,000 - 72,000 = $18,000 down payment
$18,000 + 740 - 4,000 = $14,740 check

Question 10

joint tenancy with right of survivorship may be created

Answer 10

by deed or will

Question 11

what is an example of ostensible agency?

Answer 11

the principal showed by their actions that the agent’s actions were acceptable

Question 12

a buyer took delivery of the deed to their new house but forgot to record the deed. Under these circumstances

Answer 12

the buyer’s interest is not fully protected against third parties

Question 13

Buyer bought a $20,000 property, put down $1,000, 20-year loan at 12% interest. Her monthly payments are $290.38. What is the approximate amount of interest paid on the loan at its maturity?

Answer 13

20 year loan x 12 = 240 months
240 months x $209.38 = $50,251.20
$20,000 - 1,000 down payment = $19,000
$50,251.20 - $19,000 = $31,251.20

Question 14

What BEST describes the principle that a home maintains its highest value in a neighborhood with similar homes and similar type housing?

Answer 14

conformity

Question 15

If the buyer defaulted some time ago on a written contract to purchase a seller’s real estate, the seller can still sue for damages if they are not prohibited from doing so by the

Answer 15

statute of limitations

Question 16

what covenant would NOT be found in a general warranty deed?

Answer 16

restrictive ownership

Question 17

What is the best way to ensure that there are no encroachments and verify the boundaries of a parcel of land?

Answer 17

get a spot survey

Question 18

a(n) ___ is a parcel of real property that is owned and occupied as a family home

Answer 18

homestead

Question 19

Find the annual rate of return of an $88,000 investment if the weekly gross income is $225 and the monthly expense are $370.000

Answer 19

$225 x 52 weeks = $11,700
$370 x 12 mo = $4,440
$11,700 - $4,440 = $7,260
$7,260 / $88,000 = 8.25%

Question 20

what best describes the purpose of a building permit?

Answer 20

evidence of compliance with municipal regulations

Question 21

a residential developer’s deed restrictions would probably NOT include

Answer 21

an agreement not to sell without the consent of the neighbors

Question 22

Listing and selling brokers agree to split a 7% commission 50/50 on a $387,600 sale. The listing broker gives the listing licensee 30% of his commission and the selling broker gives the selling licensee 35% of his commission. How much does the selling licensee earn form the sales?

Answer 22

$387,600 x 7% = $27,132 commission
$27,132 / 2 = $13,566 to each broker
$13,566 x 35% = $4,748.1 to the selling licensee

Question 23

many states determine the order of water rights according to which users of the water hold a recorded beneficial use permit. This allocation of water rights is determined by

Answer 23

the doctrine of prior appropriation

Question 24

Total interest paid on a 30-year straight note was $230,000 during the term of the loan. The annual interest rate was 6.6%. What was the loan amount?

Answer 24

$230,000 / 30 years = $7,666 $7,666 / 6.6% = $116,162

Question 25

a broker representing a selling does NOT owe the purchaser (customer)

Answer 25

assistance in negotiations to purchase ate low the list price

Question 26

some taxing bodies recognize that local assessments can lead to unfairly high or low value for properties in certain areas. therefore the jurisdiction may establish ____ to level out the unevenness of valuations.

Answer 26

equalization rates

Question 27

the final valuation process in appraising a duplex would e

Answer 27

reconciliation

Question 28

what is not a type of nonresidential property?

Answer 28

cooperative

Question 29

an analysis that results in an opinion of value is

Answer 29

an appraisal

Question 30

what is an example of ostensible agency?

Answer 30

the principal showed y their actions that the agent’s actions were acceptable

Question 31

a city took a property through eminent domain so they could build a sports complex and then lease it to 4 private sports franchises. Would this be allowed?

Answer 31

yes, as long as the homeowners were paid compensation for the properties

Question 32

a house was sold on an installment land contract. there was no mention in the contract about a router top microwave. can the seller take the microwave oven?

Answer 32

yes, because it is personal property

Question 33

what is true regarding Federal Fair Housing law?

Answer 33

aggrieved parties may appeal to HUD for assistance

Question 34

$140 is 3.5% of what amount?

Answer 34

$4,000

Question 35

Buyer received an 80% loan. If the annual interest rate was 4.5% and the monthly interest paid was $790, what was the total sale price?

Answer 35

$790 x 12mo = $9,480
$9,480 x 4.5% = $210,000
$210,000 / 80% = $263,333

Question 36

If the annual interest rate is 7.5% and the quarterly interest is $562.50, what is the principal amount of the loan?

Answer 36

$562.50 x 4 quarters = $2,250

$2,250 x 7.5% = $30,000

Question 37

Buyer obtains a $65,000 loan on the home. The principal and interest payments are based on a factor of 8.05 per $1,000. The loan is for 30 years at 9%. How much do they pay in total interest over the life of the loan?

Answer 37

$65,000 per $1,000 = $65
$65 x 8.05 = $523.25 per month 
30 year loan x 12 months = 360 months 
$523.25 x 360 months = $188,370
$188,370 - $65,000 = $123,370

Question 38

The interest portion of their last monthly payment was $391.42 and their interest rate is 11.5%, what was the outstanding balance of their loan before the last payment was made?

Answer 38

$391.42 x 12 mo = $4,697.04

$4,697.04 / 11.5% = $40,843.83

Question 39

If a room has measurements of 20ft x 12ft and a height of 8 ft, what is its volume?

Answer 39

Volume = length x width x height 
V = 20 x 12 x 8 = 1,920 cubic ft

Question 40

offeree has the right to ___ an offer

Answer 40

reject

Question 41

If an investment valued at $350,000 returns 12% annually, then what is the amount of income produced by this investment?

Answer 41

$350,000 x 12% = $42,000

Question 42

in a lease, the lessor’s interest is known as

Answer 42

leased free interest

Question 43

An $284,000 loan at 5.5% annual interest had principal and interest payments of $1,612.52 per month. How much of the second month’s payment would be applied to the principal?

Answer 43

$284,000 x 5.5% = $15,620 annual
$15,620 / 12 mo = $1,301. 67 monthly
$1,612.52 - $1,301.67 = $310.58 - 1st month
$284,000 - $310.85 = $283,689.15 principal balance at end of 1st month
$283,689.15 x 5.5% = $15,602.90 / 12 = $1,300.24
$1,612.52 - $1,300.24 = $312.28 2nd month

Question 44

If the assessed valuation of a property is $20,000 with a tax rate of $4.00 per $100, what is the annual tax?

Answer 44

$20,000 / $100 = $200

$200 x $4 = $800 annual tax

Question 45

a c court order that authorizes and directs the proper officer of the court to sell the property of a defendant as required by the judgement or decree of the court is known as

Answer 45

a writ of execution