test qestions Flashcards
Which of the following would not make a contract voidable?
- Duress
- Undue influence
- Illegal purpose
- Fraud
C
Although a title insurance policy does cover the risk of loss for many reasons, which of the following risks is not covered in a title insurance policy?
- Failure of husband or wife to sign the deed
- A zoning ordinance, regulation or plan
- A document in the series records in forged
- An unpaid city tax not shown in the policy
B
According to the Department of Real Estate regulations, it would be considered commingling if a broker:
- deposits into the trust fund account a renter’s check for the security deposit on an income property the brokers owns.
- leaves funds owned to him as commissions in his trust fund account for three weeks.
- deposits funds received from two different individual buyers into the same trust account.
- deposits $200 of his own money into trust account to cover bank fees on that account
A
The position of a building on its site in relationship to its surrounding is normally referred to as its:
- Topography
- Orientation
- Plottage
B
The effective date of a real estate purchase contract is the date that:
- the sellers accepts the offer.
- the security deposit was made
- the acceptance is communicated to the buyer
- the offer is made
C
When may a real estate broker, serving as agent of the seller, refuse to transmit an offer to the principal:
- When the broker is acting as a gratuitous agent
- Never
- When the broker is acting on the express instructions of the principal in his refusal;
- When the owner has already accepted a “back-up’ offer
C
Real property taxes become a lien on:
- February 1st
- July 1st
- January 1st
- November 1st
C
When must all the listings in an office be renegotiated?
- if the couple gets divorced
- if there are multiple offers
- if the broker dies
- A listing can never be renegotiated
C
Sara is a newly licensed broker and has just opened her own office. How long must she keep transaction records?
- 3yrs
- 2yrs
- 4 yrs
- 1 year
A
When selling a business, real estate brokers need to know that the term successor’s liability involves certain obligations to the:
- Department of Corporations.
- Internal Revenue Service.,
- State Board of Equualization.
- Bureau of Real Estate.
C
Personal income taxes are structured using rates that are;
- regressive
- progressive
- equal
- level
B
Four months ago, a seller entered into a legally binding written contract to sell his property. Later, the seller refused to complete the transaction since he felt the value of the property would increase in the near future. Under these circumstances, the Statute of Limitations could affect the rights of the buyer to prevail in a civil action due to a breach of the written contract within;
- Four years
- One year
- 90 days
- two years
A
Conventional loans are made from
- Fannie mae funds
- private source
- FHA funds
- Home Owners Loan Corporations
B
On an escrow closing statement, an existing mortgage that is to be assummed by the buyer is treated as;
- A credit to the seller
- all of the other options are correct
- a credit to the buyer
a debit to the buyer
C
A personal, revocable, non- assignable right to use the property of another is called:
- a license
- an option
- the lease
- an easement
A
Procuring cause would not be required for a broker to receive a commission in a(n)
- open listing
- net listing
- exclusive right to sell listing
- exclusive agency listing
C
An unlicensed personal assistant working for a licensed broker may do which of the following activities?
- Write ads and submit them to the newspaper and online approved by the broker.
- Write up an offer for a buyer and then have the broker sign the contract later.
- Host open houses
- Email brokers weekly updates to the broker’s clients
A
Which of these is an example of external obsolescence?
- Vacant, abandoned, and run-down buildings in an area
- Numerous pillars supporting the ceiling in a store.
- Coal cellar in a house with central heating
- Leaks in the roof of a wearhouse, making the premises unusable and therefore un-rentable
A
Which of the following individuals holds a license and is therefore not entitled to a claim of adverse possession?
- A person who held property for five years after “inheriting” it from a parent who was in adverse possession for ten years.
- A person who has been parking his car on a neighbor’s property for 20 years without permission
- A person who has been in possession of the property for 19 years.
- A person who has permission to enter an orchard and has been taking apples every year for 30 years
D
Zoning ordinances control the use of privately owned land in several ways. Which of the following ways is NOT a zoning control?
- Restricting the area in which a building may occupy
- Providing for control of rentals
- Regulations land-use
- Restrictive heights of buildings
B
An easement appurtenant to real property can be terminated by all of the following EXCEPT
- revocation by the servient owner
- prescription by the servient owner
- merger of both the servient and dominant parcels.
- released by the dominant tenement owner
A
A partition suit is used for which of the following?
- to allow construction of party walls
- determination of party fences
- to change a tenancy by entireties to some other form of ownership
- to force a division of property without all the owners consents
D
When an appraiser is appraising a property he usually considers all of the following except:
- The assessed value
- The property rights to be valued
- A definition of value
- The property identification
A
Involuntary methods of conveying property include all of the following EXCEPT:
- Quitclaim
- Adverse possession
- escheat
- condemnation
A
A bill of sale is used to transfer the ownership of what?
- personal property
- real property
- fixtures
- appurtemamces
A
In the formation of contracts, “valuable,” “good,” “sufficient.” and “adequate” are terms most closely associated with which of the following?
- Consideration
- Bilateral contract
- Compensation
- Preformace
A
The effectiveness of the market data approach is limited most by which of the following factors?
- The difference in the comparable property
- Economic conditions that rapidly change
- The financing terms of comparable property
- Types of property that are regularly sold
B
In some states, the instruments used instead of a mortgage is a:
- Promissory note
- Release deed
- Negotiable instrument
- Deed of Trust
D
One example of an easement in gross is the right of:
- Owners to cut across their neighbor’s property
- Utility companies to access a property in order to maintain wires or pipes
- Owners to use the neighbor’s backyard for their own recreation
- A roofing company working on repairs to store some of their equipment in the neighbor’s yard.
B
Which of the following would be classified as a general lien?
- Mechanic’s lien
- Property tax lien
- Judgment
- Real estate property tax lien
C
The difference between the value of a property and the total amount of liens against in is known as
- collateral
- a down payment
- equity
- actual cash value
C
A township contains only:
- 640 acres
- 36 sq yards
- 23,040 sq feet
- 36 sections
D
A broker accepts an exclusive authorization and right to sell listing from a corporation. During the listing term, all of the officers of the corporation die. in this case
- the listing is automatically terminated
- The listing must be acknowledged by the newly appointed officers
- the listing must be signed by the corporation’s board of directors
- the listing remains in full effect.
D
A property owner conveys a life estate to his brothers’s lifetime and designates his cousin as the person to whom the property will pass when the life estate ends. When the brother dies what happens to the property?
- The property passes to the brother’s heis
- The property owners must designate a remainderman for the property
- The cousin automatically becomes the fee simple owner of the property
- The property reverts back to the original property owner
- The
C
A landowner sells one acre of this two-acre property to a friend. He reserves for himself an appurtenant easement over the friend’s land for ingress and egress. The landowner’s property is:
- The dominant tenement
- the servient tenement
- is subject to an easement in gross
- cleared of the easement when the landowner sells the remaining acre to a third party
A
The amount of a loan expressed as a percentage of the value of the real estate offered as collateral is the:
- amortization ration
- debt to equity ratio
- capital use ratio
- loan to value ratio
D
Part of the consideration offered to a seller when the buyer signs an agreement of sale is called:
- an option.
- a recognizance
- earnest money
- a freehold estate
C
For the past 30 years, the Seddons continue to operate a neighborhood grocery store. Last week, the city council passed a zoning ordinance that prohibits packaged food sales in the area where the Seddons grocery store is now an example of a(n)
- violation of eminent domain
- non-conforming use
- illegal enterprise
- variance of the zoning laws
B
The principle of appraising, which states that the maximum value is achieved when the property is in harmony with its surroundings, is the principle of
- conformity
- highest and best use
- contribution
- competition
A
A buyer, joe, and a seller, Stephen, both sign a purchase contract. What kind of title interest, if any does joe have in the property at this point?
- ALTA
- Equitable
- Legal
- Defeasible
B
Real property can become personal property by the process called
- attachment
- severance
- hypothecation
- accretion
B
A normal size section in the Government Rectangular Survey System contains:
- 36 sq miles
- 6 sq miles
- 1 sq mile
- 160 acres.
C
A possessory right or ownership interest in real estate is called an
- abstract of title
- ad valorem
- estate
- affidavit
C
Which of the following describes a transaction broker?
- The broker represents the seller in the transaction
- The broker represents both the buying and selling parties
- The brokers represent the buyer in the transaction
- The broker does not represent either party but provides general information and services to each.
D
How much is intangible tax on a real estate purchase mortgage?
- .002
- .5
- 1
- 5.00
A
An agency contract is being terminated. In which scenario might there be damage owned to one of the parties?
- The owners discharge the agent because she was not acting in their best interest
- The agency files for bankruptcy
- The property owner discovers another claim on the title of the house.
- The agent resigns form the contract because he is overloaded with homes to sell.
D
Foreclosure occurs when a ____ seizes and sells a borrower’s______ after the borrower has failed to _____ the lender
- bank, personal property, appreciate
- lender, home, alert
- lender, collateral, repay
- bank, property, notify
C
Reversion of title is a feature of what type of interest?
- Fee simple
- Fee simple condition precedent
- Fee simple condition subsequent
- Fee simple determinable
D
The Transfer Disclosure Statement (TDS) form is required on:
- the sale of a one-to-four unit residential property
- the sale of a commercial building
- all foreclosure sale
- the sale of vacant land
A
When a purchase agreement state the property is being sold “as is,” it:
- still requires the buyer to receives a Transfer Disclosure Statement (TDS) nothing any material facts which affect the property’s value
- puts the buyer on notices they should beware
- underscores the fact the nothing is warranted
- releases the seller of the requirement to deliver a TDS to the buyer or make and disclosures about the condition of the property
A
An unlawful detainer (UD) action is instigated by:
- a grantor
- a trustee
- a lessor
- a real estate broker
C
A transaction broker
- Provides limited representation to a buyer and seller
- Has fiduciary duites
- Has a principal relationship
- Is a single agent
A
When inspecting a residence in a hillside subdivision, the salesperson observes cracks in the foundation and notices the doors and windows do not close properly. As a matter of best practice the sales person references their observation in the Transfer Discloser recommends that which of the following be ordered?
- A home warranty policy
- A special studies report
- A soil engineers inspections
- A termite clearance
-
C
Designated sales associates can be assigned in a non-residential transaction if
- FREC appoints them
- The broker signs off on it
- The buyer and seller each have assets of $1 million dollars or more
- A No Broker Relationship disclosure is signed
C
A homeowner is buying a new home but hasnt sold their old one. Which type of loan would they obtain in the short term and pay back as soon as their old house is sold?
- Swing
- home equity
- wraparound
- sale-leaseback
A
The American with Disabilities Act of 1990 would affect which of the following
- a third floor apartment in a newly constructed apartment complex
- an existing business with 20 employess
- a single family home
- multi-family home with three units
B
According to HUD standards, which of the following would be an acceptable neighborhood advertisement?
- Traditional living
- exclusive neighborhood
- Muslim-friendly
- senior housing
D
____ is when individual can be paid for brokering a real estate transaction, yet represent neither the buyer nor the seller
- situational brokerage
- transactional brokerage
- divisional brokerage
- individual brokerage
B
Some states have ____ that require agents to disclose who they are representing to the buyer
- agent identification clauses
- agency disclosure laws
- agency branding laws
- agent identification laws
B
Potential gross income minus vacancy and collection losses is
- Effective gross income
- Net income
- Total income
- Potential income
A
Jim the sales associate receives an escrow deposit on Tuesday when is the deadline to turn it over to his broker?
- wednesday
- thursday
- friday
- saturday
A
Tanancy by the entireties convey title at the same time and must be
- Husband and Wife
- Unequal percentage
- Tenants in common
- Undivided interest
A
Which of these would determine if there is encroachment on a property?
- survey
- easement
- ejectment
- appraisal
A
Which document outlines the environmental effects that are caused by new development?
- Environmental Development Report
- Environmental Impact Report
- Environmental Project Report
- Environmental Risk Report
B
Market value is different from market price in that market price __
- is taxable and market value is not
- is a fact that has actually occurred
- is not an actual value, but just an idea
- is always 10% below market value
B
The sales comparison approach to valuation is directly related to___
- Market investment return rates
- all pending, canceled and short-sale listings
- the quality and amount of sales data available
- the principle of anticipation
C
Which of the following is not a typical obligation of the mortgagor
- Maintain the property
- Keep a hazard insurance policy in force
- Get permission for alterations
- Advise the mortgagee of a change in the escrow account balance
D
When estimating the value for a particular piece of property, an appraiser will not investigate ___.
- environmental factors
- social factors
- physical factors
- future factors
D
Restrictive covenants that run with the land:
- apply only until the developer has conveyed the title
- apply to and bind all successive owners of the property
- can be removed by a court of competent jurisdiction.
- are no longer effective when the title is transferred.
B
One of the main benefits of a sale-leaseback transition would be;
- The ability of the seller to deduct all of his future rent payments as business expenditures
- You have the option to lease a property back after the termination of the lease
- The ability to maintain the book value of the new buyer
- You can get the deposit back with no objection
A
When the lender under a deed of trust requires title insurance, who would be the most likely person to pay for it?
- Mortgagee
- Trustee
- Trustor
- Beneficiary
C
Which of the following is NOT necessary for acquiring title to a property by adverse possession?
- occupying the property for at least five years
- A claim of right
- Residing on the property
- ” Open and notorious use”
C
Which of these BEST describes the capitalization rate under the income approach to estimating the value of real estate?
- Maximum rate of return allowed by law on an investment
- Rate of capital required to keep a property operating most efficiently
- Rate of return a property earns an as investment
- Rate at which a property increases in value
C
Broker Bob entered into an oral listing with a seller without subsequent written verification. As to the payment of a commission to broker Bob it is:
- a criminal violation of the law
- prohibited by rules and regulations of the commissioner.
- contrary to public policy
- permissible if the seller elects to do so.
D
A trust deed can have a provision that allows future loans on the property to have priority. This would be called:
- A release clause
- An acceleration clause
- A subordination clause
- An assignment clause
C
Which of the following is not a characteristic of a conventional loan?
- It is never by a private agency
- The ration of the loan to the value of the property usually does not exceed 80% without private mortgage insurance.
- It is neither insured nor guaranteed by public agency
- Security rests on the borrower’s ability to pay and collateral pledge.
A
A section
- has a perimeter of 5,280
- contains 460 acres
- is one sq mile
- can be numbered from 1 through 50
C
Which of the following would be paid before any homestead exemption is applied?
- none of the other options are correct
- Property taxes, a deed of trust and any mechanics lien
- A deed of trust and mechanics lien
- Property taxes
B
There are three phases of steps involved in the construction of a single family residence. These three steps are:
- Land acquisition, construction and zoning approval
- Land acquisition, map and plan approval and construction
- Map and plan approval, construction and buyer approval
- Subdivision map approval, building permits and creation of CC&Rs
B
A real estate agent wrote an offer for a buyer. The buyer was primarily interested in this particular home because it was located in a very good school district. The deposit receipt did not make the offer contingent upon the school district. The offer was accepted and escrow was opened. During escrow, the buyer discovers the school district had just been changed and now the home is located in a poor school district. Which of the following is true?
- Buyer is not obligated to buy
- Buyer has the right to rescind
- Buyer is bound to the contract
- Buyer can back out
C
When a mortgaged home appreciates in value, the value accrues to the benefit of:
- the beneficiary
- the trustor
- mortgagee
- the trustee
B
A recorded legal document that gives constructive notice that an action affecting a certain property has been filed in court called:
- a habendum clause
- an estoppel certificate
- A lis pendens
- a general warrenty deed.
C
When is it permissible for a licensee to fill out the seller’s portion of the Transfer Disclosure Statement (TDS) on his own, without the seller’s involvement?
- Never
- When the seller has not had the opportunity to visit the property
- When the buyer signs a waiver
- When the seller has given written permission.
A
One of the main difference between real and personal property is that real property:
- is immovable
- Can be willed
- Can be held in joint tenancy
- Is subject to depreciation over a period of time;
A
Which act requires that “reasonable accommodation” be made in public for the entire public?
- Equal Opportunity Act
- Civil RIghts Act
- Fair Housing Act
- Americans with Disabilities Act
D
Broker Dave has an exclusive agency listing to sell a $200,000 home for owner Jones. Before the listing expires, the home was sold through Jones’ own efforts to a friend. Jones refused payments of any commission to broker Dave. Dave is legally entitled to a transaction commission of:
- the entire agreed-upon commission
- Nothing
- all expenses incurred while advertising the property
- one-half of the agreed-upon commission
B
Discrimination is prohibited in leading practices under:
- ECOA
- RESPA
- FNMA
- Truth in Lending Act
A
When the owner of a property believes that her property has been over assessed by the county assessor, she should contact the:
- County Board of Supervisors;
- County Tax Collector’s Office
- Assessment Appeals Board;
- State Controllers Office;
C
Ownership rights and interests in real property are determined in a:
- civil action suit
- quiet title action
- judgment lien
- suit for specific performance.
B
The most important test of a fixture is:
- adaptability of the item
- cost of installation
- method of attachment
- intention of the parties
D
The position of trust assumed by the broker as an agent for the client is described most accurately as a
- trustor relationship
- confidential relationship
- trustee relationship
- fiduciary relationship
D
An agreement wherein one party agrees to reimburse the other party for damages suffered in the event of a clearly defined risk, in exchange for payment of monetary consideration, is commonly known as:
- A fidelity bond
- An insurance policy
- A management agreement
- A lease agreement
B
When is it permissible for a licensee to fill out the sellers portion of the TDS own his own, without the seller’s involvement.
- When the seller has not had the opportunity to visit the property
- Never
- When the buyer signs a waiver
- When the seller has given written permission
B
Which of the following would alienate title to property?
- Recording a homestead
- Securing an ALTA policy of title insurance
- Conveying title
- Clouding the title
C
Ingress and egress apply to:
- deed restrictions
- zoning
- homestead
- easement
D
Susan who is a buyer, has entered into an agreement with more than one buyer’s agent at the same time but owns compensation only if she uses the services of a buyer’s broker. Susan’s arrangement is known as a(n):
- exclusive right agreement
- open agreement
- exclusive agency agreement.
- multiple-listing agreement
B
What type of an appraisal license is required to appraise a commercial strip mall valued at $700,000
- Certified residential license;
- Certified general license;
- Residential real estate license;
- Retail appraisal License;
B
A buyer defaulted on a real property installment sale contract that had been recorded by the seller. If a quitclaim deed were to be used to extinguish the cloud on the title it must be executed by;
- Buyer and the Seller
- Seller only
- Neither the Buyer or the Seller
- Buyer only
D
When an owner is selling his or her home, to whom would they most likely give a copy of a structural pest control report?
- To the escrow company
- To the broker or salespeople representing potential buyers
- To the buyer, if requested
- Their broker, at the time of listing
C
An appraiser has been hired to prepare an appraisal report of a property for loan purposes. The property is an elegant old mansion that is now leased out as a restaurant. To which approach to value should the appraiser probably give the greatest weight when making this appraisal?
- Income
- Replacement cost
- Sales comparison
- Reproduction cost
A
Copies of termite reports filed with the structural pest control board within the preceding two years can be obtained upon request by:
- a real estate licensee
- a licensed lender
- anyone
- the owner of the home
C
A square is 1/8 of a mile by 1/8 of a mile. How many acres is this?
- 20 acres
- 160 acres
- 10 acres
- 40 acres
C
Which of the following is created when possession and title do not occur at the same time?
- Writ of execution
- Interim Occupancy Agreement
- Estate at Sufferance
- Subordination clause
B
The main purpose of “RESPA” (Real Estate Settlement Procedures Act) is to:
- To standardize settlement services through out the United States
- To provide consumers with enough information to enable them to shop for settlement services
- Place a fixed limit on settlement cost in all real estate transactions
- Place a fixed limit on settlement cost on residential property of four units of less
B
When a judgment is rendered, how long does a creditor have to enforce it/
- 5 years
- 1 year
- 20 years
- 6 months
C
A person agrees to sells a property for $500,000. The buyer gives the seller $150 as valuable consideration for a six-month option. Which of the following statement is true?
- The $150 is valuable consideration if the seller accepted it
- The seller cannot accept money for the option
- The buyer must have at least 5% down as valuable consideration
- The buyer must have at least 20% down.
A
Any lease that names a specific termination date is an;
- joint tenancy
- estate at will
- Periodic Tenancy
- estate for years
D
A promissory note:
- is an agreement to preform or not to perform certain acts
- is the primary evidence of a debt
- is a guarantee by a government agency
- may not be executed in connection with a real estate loan
B
The quantity survey method; unit-in-place method; and the square or cubic foot methods in real estate appraisal most directly related to:
- The sales comparison approach
- The income approach
- The cost approach
- All of the other options are correct
C
The relationship between a property and a prospective purchaser is known as:
- value
- progression
- highest and best use
- utility
A
When real property is held by husband and wife as community property, an agreement to sell that property that has been signed by only one spouse is considered;
- illegal
- binding
- a violation of the Stature of Frauds
- unenforceable
D
A deed conveys ownership to the grantee “as long as the existing building is not torn down. “What type of estate does this deed create?
- Nondestructible estate
- Fee simple absolute estate
- Determinable fee estate
- life estate pur autre vie, with the measuring life being that of the building
C
For federal income tax purposes, capital expenditures for improvements:
- Cannot be depreciated over the remaining life of improvements
- Are subtracted from the “cost basis” of the property
- Are deducted in full as expenses that year
- Are added to the “Cost Basis” of the property and depreciated
D
Carol Padilla is a real estate salesperson employed by Vitality Properties, She sells a home listed by another broker, Amplify Realty. After escrow was opened, but before closing, she ask Amplify broker for a $1,000 advance against her commission. What happens if the Amplify agrees?
- It will be viewed as unprofessional, but not illegal
- The broker can advance the money to Carol’s broker who can then give her the advance
- Nothing, its simply an advance against earnings between two real estate professionals
- It will be a violation of real estate law.
D
Which of the following provides a buyer with the best assurance of clear, marketable title?
- general warranty deed
- certificate of title
- title insurance
- abstract of title
C
A Negative Declaration is:
- a positive response to an Environmental Impact Statement
- a negative response to an Environmental Impact Statement
- a positive response to a Transfer Disclose Statement
- a negative response to a Transfer Disclose Statement
A
Which of the following statements about options is false?
- Consideration must be given by the optionee to the optionor
- A lease option is a unilateral contract
- The option binds the optionee to the performance
- The optionee does not have any rights to the land
C
During escrow, if an unresolved dispute should arise between the seller and buyer preventing the close of escrow, the escrow holder may legally:
- Rescind the escrow and return all documents and monies to the respective parties
- Consider the contract null and void
- File an interpleader action in court
- Arbitrate the dispute as a neutral party
C
A licensee needs 45 hours of continuing education to renew his/her licenses, how many hours must be consumer protection?
- 24
- 30
- 12
- 18
D
The real estate financing instrument which transfer equitable title to real property, but retains legal title in the seller, is call:
- A trust deed
- A mortgage
- A real property conditional installment sale contract
- A security agreement
C
Regarding a promissory note when getting financing:
- The promissory note is not part of the deed of trust
- The deed of trust secures the promissory note
- The grant deed secures the promissory note
- A promissory note secures the deed of trust
B
