Real Estate

Exam Prep

The residential listing agreement can be described as:

An Employment Contract

What is a point

1% of a loan amount

A license holder in an agency relationship:

must treat all parties with honesty and fairness

Wetlands are often associated with:

endangered species

A listing to sell property and obtain a fixed specific price for the owner is:

a net listing

Which of the following statements about Contract for Deed is FALSE?

legal title is transferred to the buyer when the agreement is signed

In many instances a lender will require a buyer to purchase PMI when financing the purchase of a home. What does PMI do?

insures the lender’s exposure of risk, usually the top 25-30% of the loan amount.

A home was purchased for $300,000 in a neighborhood where homes have been appreciating 3% a year for the past 4 years. Using compound appreciation, what is the current value of the property? (Round your answer to the nearest dollar amount.

$337,653.00

Which of the following would be sufficient cause for escheat?

a property owner abandons the property

A visually impaired individual with a service animal applies to lease an apartment. The apartment complex has a strictly enforced "no pets" policy. Compliance with Federal Fair Housing laws requires the landlord to allow the tenant to have the dog on the property. The dog damages the apartment. Who is required to pay for repairs in this instance?

The dog owner

Mary is a sales licensee sponsored by her broker Jim. She has 3 current unsold listings. Mary has decided to terminate her relationship with Jim and move to a new real estate company. When Mary leaves, what happens to her listings?

Jim retains the listing

A physically handicapped tenant has modified an apartment to meet his needs at his own expense. His lease is about to expire and he plans to move. The landlord wants the apartment restored to its original condition. What is true?

The tenant must restore the apartment at his own expense

Who must be involved in the negotiation of a short sale?

The buyer, seller, and seller’s lender

Which of the following would be a violation of Fair Housing laws?

charging a higher security deposit to a handicapped tenant due to the landlord’s increased insurance rate

A three-year lease on office space would be terminated by:

Mutual rescission

Mark's fence is trespassing on John's land. This is an example of:

an encroachment

A house is listed for $499,000. The seller received an offer for $485,000. He countered at $490,000. He has not had a response to his counteroffer. The listing agent has received a new offer from a second buyer for $495,000 and presented it to his seller. The seller would like to accept this new offer. What is true?

The seller can withdraw his counteroffer to the first buyer and then accept the offer from the second buyer

A property owner receives a notice that his land is in an improvement district. What does this mean?

He will receive an additional tax bill

When the acts or conduct of a license holder leads a consumer to believe that licensee is representing the consumer's best interests this is an example of:

Implied agency

The tax on a given piece of real estate is determined by multiplying the tax rate of the assessing body by the:

assessed valuation

What does a listing agent provide to a seller?

knowledge of market conditions

A broker has written permission from both a buyer and a seller to represent both parties in a transaction. The seller has confided to the broker that he is facing bankruptcy and must sell the property as quickly as possible. What should the broker tell the buyer about this?

the broker should not share this information with the buyer

The owner of 5 parcels of property desires a mortgage loan and offers all 5 parcels as security. The mortgage he will generally be required to execute is called:

a blanket mortgage

A broker has received $4387.50 in commission after paying his agent 70%. The listing commission was 6% split evenly between the listing and selling broker. What was the sale price of the property?

487,500

A listing agent has provided a blank seller’s disclosure form to her seller. She has encouraged the seller to complete it as honestly as possible. While reviewing the form, the agent noticed the seller did not disclose a visible material defect to the property. The agent took the disclosure form to her broker and mentioned her concerns to the broker. The broker said, “The seller is responsible for filling out the seller’s disclosure. Let your seller do it!” At this point, who will be liable for the misinformation on the form?

the seller, the listing agent and the broker will be liable as all are aware of the misrepresentation of material fact

A property is found to have asbestos on site. What is true?

Encapsulation of the asbestos containing materials can be used to solve the problem

What is a significant difference between foreclosure under a deed of trust and foreclosure under a traditional mortgage?

under a deed of trust there is no lawsuit but under a traditional mortgage there is a lis pendens and lawsuit

What is the best definition of the Principle of Anticipation?

the present value of property can be affected by approved future projects in the community

What is the least important factor for a license holder preparing a CMA?

the information form expired listings of unsold property in the area

Which of the following demonstrates the physical characteristic of indestructibility?

a house is destroyed by natural causes, but the soil remains.

When two or more parties unite for the purpose of operating a real estate investment this is an example of a:

syndicate

All of the following are hazardous substances that a license holder should be aware of except:

acrylic paint

A broker is helping a buyer and seller to reach an agreement in a real estate transaction. He does not have a representation agreement with either party. His role is best defined as:

a transaction broker

Which is the best definition of a contingency?

a provision that must be satisfied before the contract can be fully executed

A property owner gives his neighbor temporary permission to drive across his property until the neighbor’s road construction is completed. What is this an example of?

a license

A home is assessed at $246,000. The tax rate is $1.96 per $100. There is a standard exemption of 20% and because the owner is 67 years old there is a 5% senior exemption. What is the annual property tax bill?

3,616.20

A property manager has signed a management agreement. His commission is set at 8% of monthly rents. Potential gross rents for the property total $15400. Last month there were two vacancies resulting in a loss of $1850 in rent. Monthly expenses for the property were $4750. What did the property manager earn last month?

1,084.00

A legal description beginning at a point 200 feet due north of an old oak tree at the corner of Main St. and Broad St., then going on to measure distance and direction is most likely a description by:

metes and bounds

Using the market data approach, determine property value for a seller's 3 bedroom, 2-car garage home. There are two comparable home sales. The first has 4 bedrooms, a 2-car garage and sold for $300,000. The second has 3 bedrooms, a 1-car garage and sold for $285,000. A single garage has an estimated value of $5,000. A single bedroom has an estimated value of $10,000. The value is:

290,000

Broker B has signed a Buyer Representation Agreement with his clients. As a buyer’s agent he must not disclose:

His buyer’s ability to make a higher offer