SU # 57__Leases and Security Deposits

Question 1

Which type of leasehold estate is commonly referred to as a periodic tenancy?

Answer 1

Estate from period to period

Question 2

What are a tenant’s primary obligations when leasing a property?

Answer 2

Pay the rent on time
Maintain the property’s condition
Comply with the rules and regulations of the building

Question 3

What is the difference between a sublease and an assignment?

Answer 3

A sublease is the transfer by a tenant of a portion of the leasehold interest to another party.

An assignment of the lease is a transfer of the entire leasehold interest by a tenant to a third party.

Question 4

List three commons causes of a lease termination.

Answer 4

Term expiration.
Voluntary agreement
Property destruction

Question 5

Define a gross lease.

Answer 5

The tenant pays a fixed rent and the owner pays the taxes, insurance and other normal ownership expenses.

Question 6

Grant moves into his new office space while he awaits the completion of the negotiations of the lease terms. During this interim period, Grant makes monthly rent payments and the owner accepts them. How would Grant’s lease at this time be classified?

Estate for years

Estate from period to period

Estate at will

Estate at sufferance

Answer 6

Estate from period to period

Question 7

What is one important difference between a sublease and a lease assignment?

In a sublease, responsibility for the original lease is transferred completely to the landlord.

In a sublease, the original tenant retains primary responsibility for performance of the original lease contract.

A sublease does not convey any of the leasehold interest.

A sublease conveys the entire leasehold interest.

Answer 7

In a sublease, the original tenant retains primary responsibility for performance of the original lease contract.

Question 8

This occurs when a tenant remains on the property without the owner’s consent after lease termination.

Estate at Sufferance

Estate at Will

Estate at Possession

Estate in Default

Answer 8

Estate at Sufferance

Question 9

What kind of lease contains a recapture clause?

Percentage

Net

Index

Graduated

Answer 9

Percentage

Question 10

What method is used to remove a tenant who is in default in paying rent?

Foreclosure

Condemnation

Lock out

Suit for eviction

Answer 10

Suit for eviction

Question 11

Which kind of lease increases at specified intervals?

Graduated

Gross

Percentage

Net

Answer 11

Graduated

Question 12

Business owner Jill, leases a store front. Her lease amount is based on the wholesale price index. What type of lease does Jill have?

Proprietary Lease

Bracket Lease

Index Lease

Step Lease

Answer 12

Index Lease

Question 13

Which of these items is not included in a lease agreement?

Terms

Demising clause

Description of premises

Alienation clause

Answer 13

Alienation clause

Question 14

When a tenant agrees to pay taxes and maintenance, the tenant has what kind of lease?

Gross

Periodic

Net

Graduated

Answer 14

Net

Question 15

A type of lease when the tenant pays for the taxes, insurance, maintenance and repairs is called what?

Simple Lease

Triple Net Lease

Quad Lease

Expense Lease

Answer 15

Triple Net Lease

Question 16

A tenant living in cooperative owned housing, would hold what type of lease?

Index Lease

Branch Lease

Shared Lease

Proprietary Lease

Answer 16

Proprietary Lease

Question 17

Who may file for a constructive eviction?

The Landlord

The Courts

The Tenant

The Tenant’s Neighbors.

Answer 17

The Tenant

Question 18

Jill pays $2,450 per month on an apartment. No other expenses are paid by Jill. What type of lease does Jill hold?

Gross Lease

Net Lease

Progressive Lease

Not Net Lease

Answer 18

Gross Lease

Question 19

Which of the following summarizes the general terms of a ground lease?

The landlord sells the ground to another, then leases it back.

A tenant buys the landlord’s ground, then leases the improvements.

The landlord leases the ground floor of the building to a commercial tenant.

The tenant leases the ground from the landlord.

Answer 19

The tenant leases the ground from the landlord.

Question 20

Which kind of lease has no time limit?

Estate for years

Estate at will

Estate from period to period

Estate at sufferance

Answer 20

Estate at will

Question 21

A lease contract is best described as

a. a temporary transfer of legal title.
b. an instrument of conveyance of limited title.
c. a conveyance of a possessory interest.
d. a title conveyance in exchange for rent.

Answer 21

c. a conveyance of a possessory interest.

Question 22

When a tenant acquires a leasehold estate through a lease, what does the property owner acquire?

a. A freehold estate
b. A reduced leasehold estate
c. A leasehold estate
d. A leased fee estate

Answer 22

d. A leased fee estate

Question 23

When an owner leases her property, she temporarily relinquishes the right to

a. transfer the property.
b. encumber the property.
c. occupy the property.
d. maintain the property

Answer 23

c. occupy the property.

Question 24

Which of the following happens when a leased property is sold?

a. The buyer acquires title subject to the lease.
b. The lease is cancelled.
c. The lease expires within thirty days unless renewed.
d. A new lease is automatically executed.

Answer 24

a. The buyer acquires title subject to the lease.

Question 25

A landlord and tenant complete a one-year lease. The following week, the landlord dies. Which of the following is true?

a. The lease is cancelled and must be re-written.
b. The tenant must continue to abide by all lease terms.
c. The tenant may annul the lease at his or her option.
d. The landlord’s heirs may cancel the lease at their option

Answer 25

b. The tenant must continue to abide by all lease terms.

Question 26

If a lease does not state a specific ending date, when does it terminate?

a. Immediately, since it is an invalid lease
b. After one year
c. When either party gives proper notice
d. Whenever the property is sold

Answer 26

c. When either party gives proper notice

Question 27

In accordance with the Statute of Frauds,

a. leases in excess of one year must be recorded to be enforceable.
b. oral leases are not enforceable.
c. a five-year lease must be in writing to be enforceable.
d. an unwritten lease is fraudulent.

Answer 27

c. a five-year lease must be in writing to be enforceable.

Question 28

What is one important difference between a sublease and a lease assignment?

a. In an assignment, responsibility for the original lease is transferred completely to the assignee.
b. In a sublease, the original tenant retains primary responsibility for performance of the original lease contract.
c. A sublease does not convey any of the leasehold interest.
d. A sublease conveys the entire leasehold interest.

Answer 28

b. In a sublease, the original tenant retains primary responsibility for performance of the original lease contract.

Question 29

Which of the following lease types conveys rights other than the rights to exclusive use and occupancy of the entire property?

a. A rights lease
b. A percentage lease
c. A gross lease
d. A net lease

Answer 29

a. A rights lease

Question 30

An owner leases a property to a business in exchange for rent. The tenant is required to pay all operating expenses as well. This is an example of a

a. proprietary lease.
b. percentage lease.
c. gross lease.
d. net lease.

Answer 30

d. net lease.

Question 31

The percentage lease is most often used by

a. industrial landlords.
b. retail landlords.
c. residential landlords.
d. office landlords

Answer 31

b. retail landlords.

Question 32

Which of the following summarizes the general terms of a ground lease?

a. The landlord sells the ground to another, then leases it back.
b. A tenant buys the landlord’s ground, then leases the improvements.
c. The landlord leases the ground floor of the building to a commercial tenant.
d. The tenant leases the ground from the landlord and owns the improvements.

Answer 32

d. The tenant leases the ground from the landlord and owns the improvements.

Question 33

Among the usual remedies available to the injured party if tenant or landlord defaults on the terms of a lease is the right to

a. sue to compel performance of the contract.
b. enter a lien against the other’s estate.
c. lock the other party out of the premises.
d. apply the security deposit to legal expenses

Answer 33

a. sue to compel performance of the contract.

Question 34

A lease automatically terminates under which of the following circumstances?

a. The tenant fails to pay rent.
b. The leased property is foreclosed.
c. The tenant goes out of business.
d. The landlord cancels the lease.

Answer 34

b. The leased property is foreclosed.

Question 35

One of the aims of the Uniform Residential Landlord and Tenant Act is to

a. create a standard residential lease for use nationwide.
b. force states to enact tenants’ rights laws.
c. establish uniform rental rates for each type of property.
d. discourage the use of unfair and overly complex leases.

Answer 35

d. discourage the use of unfair and overly complex leases.

Question 36

A primary theme of the Uniform Residential Landlord and Tenant Act is that both landlord and tenant

a. waive their rights to sue for damages.
b. bargain with each other in good faith.
c. give sixty days’ notice of intent to terminate the lease.
d. observe the Realtor’s Code of Ethics.

Answer 36

b. bargain with each other in good faith.