Real Estate Prep Practice Exam

Which of the following is not one of the three physical components of land?

riparian

Which of the following statements is not true concerning legal descriptions?

In the government survey method, there are 43,560 acres in a section.

In which theory of mortgage lending, does the borrower retain ownership of the property?

lien theory

How is the binder deposit shown on the Closing Disclosure Form?

credit to the buyer

What is the maximum amount of time the Florida Real Estate Commission (FREC) can suspend a licensee's license?

10 years

Sara is retired military and has decided to move to Florida to be near her grandchildren. She has decided to apply for a VA, (Veterans Administration) loan. Which of the following statements is incorrect about a VA loan?

VA loans are government-insured loans and therefore assumable.

Newly licensed sales associate Kela has started training with her broker and learning the real estate business. Kela has training scheduled with her broker this week to learn about contracts. Which of the following contracts can Kela not prepare?

a mortgage

Wayne sold his property that was encumbered by an existing mortgage without the permission of the lender. When the bank contacts Wayne and informs him that the entire balance of his note is due, what clause in the mortgage is the bank exercising?

the due-on-sale clause

When does the No Brokerage Relationship Notice have to be shown?

before showing property

How many hours is the post-license course for sales associates?

45 hrs

If an an appraiser was appraising a two-bedroom home and the comparable had three bedrooms, what would be the appropriate adjustment if a bedroom was worth $10,000?

subtract $10,000 from the comparable

Ben decided to extend his porch near the back of his property. He believes it will add value to his home. Ben's contractor told him that the porch is going to be too close to his property line because of current zoning laws. What must Ben request to be able to extend his porch?

a variance

Which type of mortgage lending theory does Florida practice?

lien theory

Broker Kenny has decided to send out flyers to increase his revenue. Kenny had his licensed assistant mail out 500 flyers to business owners in the city. On the flyers it was explained that for every buyer or seller that they send Kenny, he will give them a referral fee of $50. Which applies?

Kenny is in violation of F.S. 475 and could be punished by the Florida Real Estate Commission.

Which of the following is not an encumbrance on a title?

an assignment

A unilateral contract to keep open for a specified period of time an offer to sell or lease real property, where the property owner grants the prospective buyer the right to buy the property within a specified period for a specified price and terms, is what kind of contract?

an option contract

On the Closing Disclosure Form, which of the following would typically be a debit to the buyer?

the intangible taxes

In the income capitalization approach, how does the appraiser arrive at the effective gross income?

Potential gross income minus vacancy and collection losses

Which of the following is not one of the authorized settlement procedures available to a broker in an escrow dispute?

escrow administrative order

Which document stipulates which party pays which expense?

the purchase and sales contract

Which of the following is not a special purpose deed?

a minors deed

How many sections are in a township?

36

Which of the following statements is incorrect concerning a joint tenancy?

If two people take title as joint tenants, they could have two separate deeds.

What is the definition of leverage?

Leverage is the use of borrowed funds to purchase assets.

A prospective buyer is deciding between purchasing a cooperative unit or a condominium unit. Which of the following statements is true regarding cooperatives and condominiums?

The unit owner of a cooperative receives shares of stock that entitle them to a proprietary lease, and the owner does not receive a deed.

Which of the following is not one of the three types of legal descriptions used in Florida?

the standard method

Which type of loan includes both real and personal property as security for the debt?

package mortgage loan

A broker listed a single-family home in Orange County, Fl for $695,000. A sales associate from a different brokerage called the listing broker and presented an oral offer of $645,000. The listing broker did not present the verbal offer to the seller. Which applies?

The listing broker is required to present all offers, and because he did not, he could be punished by the Florida Real Estate Commission for violating F.S. 475.

A tenant has a lease and pays the landlord $2,600 a month. The landlord is responsible for the property taxes, expenses, and insurance. Which type of lease is this an example of?

gross lease

How are unpaid property taxes shown on the Closing Disclosure Statement?

debit seller, credit buyer

Which of the following is deductible for a homeowner on their federal income taxes?

mortgage interest and property taxes

The Florida Residential Landlord and Tenant Act requires landlords to account for advance rents and security deposits in one of three ways. Which of the following is not one of the choices the landlord has regarding holding advance rents and security deposits?

A landlord can hold the money in any of the 50 states in a separate non-interest-bearing account for the benefit of the tenant.

When a property is not homestead, which of the following types of value is used to calculate real estate taxes, (property taxes)?

assessed value

Broker Trina sold a rental list to a prospective tenant, Sabrina on January 18th for $495.00. The list was completely up-to-date and 100% accurate. If on January 29th Sabrina calls Trina and tells her she never obtained a rental and requests her money back, which applies?

Sabrina is entitled to a refund of $371.25

How is 29.8 mills expressed as a decimal?

.0298

What is the status of a sales associate's license if they do not complete the 45-hour post-license course before the first expiration of their license?

null and void

Which of the following is also called legal notice and is the act of recording documents in the public records?

constructive notice

Which of the following statements is true concerning lead-based paint?

In houses built before January 1, 1978, sellers must disclose all known lead hazards, provide the buyer with a disclosure about lead-based paint, furnish the buyer with an EPA pamphlet, and offer the buyer 10 days to inspect the property for lead.

Which type of listing offers the broker the best protection?

exclusive right-of-sale listing

Lenders in the mortgage market who supply mortgage funds directly to borrowers are known as

primary lenders

Which of the following is not required to be on the brokerage office sign?

the word REALTOR

A broker receives referrals from a friend in his neighborhood. The broker does not pay the friend a referral fee but instead he gives his neighbor a gift card for every referral. Which applies?

The broker and the friend are in violation.

The Closing Disclosure Form is intended to summarize the financial transaction between a buyer and a seller. Which of the following statements is incorrect concerning the form?

All mortgages are debit to the buyer.

Property management in the real estate business has gained popularity and importance due to

the growth in absentee ownership

What is it called when a person has an interest in real property, and it is implied that the individual will receive legal title at a future date?

equitable title

Title to real property passes to the grantee when the deed is delivered and

accepted

A real estate appraiser's fee for performing an appraisal is

based on the time and difficulty of the appraisal

How many acres is 87,120 square feet?

2 acres

Which of the following statements is correct about unlicensed assistants?

Unlicensed assistants are permitted to deliver escrow to the title company.

The Florida Constitutional Homestead Tax Exemption is up to $50,000 and is deducted from the

assessed value

The monetary policy in the United States is determined by

The Federal Reserve System

With a purchase Money Mortgage (PMM) the mortgage is typically taken back by whom?

the seller

A licensee may substitute attendance at one legal agenda session of the FREC for

3 hours of continuing education

What does an agent have to do that fails to complete the required 45-hour post-license course before the expiration of his or her license if he or she wishes to continue in real estate?

submit fingerprints, submit a license application, complete the 63-hour course, and pass the state exam.

How many days does a licensee have to report a change in address to the DBPR?

10

A real estate broker and an owner-developer are business partners who share an office. Which applies?

A sales associate must be registered with the DBPR and can only work for either the owner developer or the broker, but not both.

What is the purpose of FHA insurance?

FHA insurance is intended to reimburse lenders when an FHA-insured loan is determined to be uncollectible.

Which of the following would need to be performed by a licensed appraiser?

An appraisal assignment to originate a federally related loan

A buyer recently purchased a house on the beach and woke up the first morning to find strangers walking through his property to reach the water. When he contacted the court, he discovered that because the pathway was used uninterrupted for a statutory period of 20 years, the court established the path as public access. What is this an example of?

an easement by prescription

Which type of brokerage relationship is presumed?

transaction broker

Increased traffic flow of a neighborhood would most likely cause

external obsolescence

A lender charged 6% interest, and the borrower bought 6 points on a conventional loan. What is the approximate effective yield to the lender?

6 (3/4)

Which term describes the physical land and improvements as well as intangible interest and rights?

real property

A joint tenant who wants to sell their share of a property

can sell their property to someone wand that someone would be a tenant in common.

A developer purchased 100 acres of land and is currently subdividing the property. He plans to make a new subdivision and should reserve within the mortgage a

partial release clause

To raise the lender's yield on a mortgage by 1%, the approximate discount points required is

8 points

The note in the title theory state has been paid in full. The mortgage lien can be released through

the defeasance clause.

A non-freehold estate that does not have a specified time limit is

tenancy at will

If a broker advertises a property for sale and knows that the property has hazardous chemicals underneath it, the broker is

always required to disclose this to potential buyers

A sales associate performs a broker's price opinion. Who is the bank that ordered the BPO required to pay?

the sale's associates broker

Which of the following is not one of the purposes of the Constitutional Homestead?

protection of the debt

Which of the following could be an implied easement?

an encroachment

An abstract of title is a

condensed history of a title.

When someone dies intestate, (no will) the state will appoint an individual to settle the deceased individual's estate. Which of the following deeds is used in this case?

a personal representative's deed

If a business owner wants to open a day care center in her neighborhood that is zoned residential, what does she need to request?

a special exception

The guarantee in which the seller provides assurance that he owns the property and, therefore, has the right to sell it is called the covenant of

seisin

Which of the following liens would take priority?

Property tax lien date October 3, 2023

Which party would typically pay for discount points?

the buyer

Which of the following statements is false concerning special purpose deeds?

A personal representative's deed is used when the grantee must sign the deed as appointed by will or by the order of court.

Which of the following statements is not true about the status of a sales associate's license?

a sales associate's license will be null and void if he or she does not complete the required 14-hour continuing education course.

How many acres are in a section?

640

What is called when an investor may lose all or part of an investment?

risk

A sales associate was found guilty of stealing listing agreements from his employer, which applies?

If the sales associate was found guilty of stealing original listing agreements, he could be charged with larceny.

Which Florida statute governs the homeowners' associations?

F.S. 720

Which of the following statements is true regarding all listings, including any commission that is paid by the buyer or the seller?

The listings and commission are legally the property of the sales associate's employer.

Which of the following contracts is not covered by the Statute of Frauds?

a listing contract for six months

When advertising on an internet site, the name of the brokerage firm must appear where?

The name of the brokerage firm must be adjacent to or immediately above or below the point of contact information of the brokerage firm or the licensee.

A sales associate employs an unlicensed personal assistant to help her with her business. The unlicensed assistant may not

negotiate the terms and conditions of a contract with the seller

How many square feet are in one acre?

43,560

A parcel of land contains 100 acres. A developer has reserved 20% of the land for streets and a community center. If each lot is zoned for a minimum of 10,000 square feet, what is the maximum amount of lots available?

348

A building is 5 stories high and each floor is 100x50. I want to put bins in all the space I can. I can't use 20% of each floor. The bins are 5x5. How many bins can I put in this building?

800

What is the gross rent multiplier of a property that rents for $4,000 a month with a sales price of $600,000?

150

A buyer has a down payment of $50,000 and the sales price is $400,000. What is the loan-to-value ratio?

87.5%

An appraiser is appraising a three-bedroom home and is using a comparable that has four bedrooms. The appraiser has placed a value of $5,000 for a bedroom. If the comparable sales price was $500,000 what is the adjusted amount of the comparable?

$495,000

How many acres and square feet are in the SW1/4 of the NE1/4 of the E1/4 of the W1/4 and the N1/4 of the SW1/4 of the E1/4 of the W1/4 of section 9?

5 acres; 217,800

Calculate all applicable documentary stamp taxes and intangible taxes for property located in Sarasota County:

Purchase price $780,000

Earnest money deposit $78,450

Recorded first mortgage (assumed) $157,000

Second mortgage (new) $200,240

Cash at closing $17,300

$7,111.03

While working for a broker, a sales associate acquired a listing for $849,000 at a 6% commission rate. A second sales associate, who works for another brokerage office, found the buyer for the property. The listing and selling brokers agree to a 50-50 split between the two offices. The property sold for $800,000. The selling broker kept 35% of the commission received by the selling office. How much did the selling office's sales associate receive?

$15,600

A lot measures 120x60 feet and street paving costs $30 per lineal foot. The city has agreed to pay 25% of the paving costs. What will the special assessment cost?

$1,350

A man can borrow $78,000 to purchase a house, and this is 2.5 times his salary. What is his annual salary?

$31,200

A residential investment property is scheduled to close on April 21. The seller collected rent for April at the first of the month amounting to $900. According to the contract for sale and purchase, the buyer is due the rental income for the day of closing. Calculate the proration.