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NYREI quiz questions
Terms in this set (204)
Greg lists his home with PDQ Realty allowing them to put a sign in the yard, list it in MLS, and advertise it in the local newspaper. During the listing period, Greg sells the home to his brother and is not obligated to pay PDQ any commission. What type of listing did Greg have with PDQ?
Which statement indicates that the listing agreement is an exclusive right to sell? (the commission expected on the sale price, a notice to terminate the agreement at the end of the listing period, a notice regarding the existence of the Real Estate Recovery Fund, a statement that the broker is paid regardless of who sells the property
A statement that the broker is paid regardless of who sells the property
A seller instructs a sales agent not to disclose a defect hidden behind a paneled wall. The sales agent is under the duty to:
not follow the instruction of the principal in this matter and possibly void the listing
Seller Sam calls a real estate agent to list his home. Sam tells the agent that he wants 156k in his pocket at closing and the agent can have the rest for the commission. What type of listing would this be?
Net listing. Illegal in NY
The seller lists her house with New Age Realty. The next day, the seller goes to work and mentions listing her house. A co-worker expresses interest in the listing. What kind of listing would make the broker entitled to a commission if the co-worker makes an offer acceptable to the seller?
Exclusive right to sell
Which listing arrangement provides the greatest opportunity for an agent to earn commission?
Exclusive right to sell
A seller completes a property disclosure form and states that there are no conditions in the property that are in need of repair. However, the listing sales agent recognizes the early signs of termite infestation. The listing sales agent should
Disclose this condition to the buyer, as this is a latent defect
When is the property condition disclosure statement usually completed?
When the property is listed for sale
A real estate broker will lose the right to a commission if he or she
was not licensed when a sale occured
Which statement about NY's Property Condition Disclosure Statement is true? (A buyer must receive a copy of the disclosure before signing a sales contract, only visible structural defects need to be disclosed, the seller has a duty to disclose death by natural causes, sellers of condominiums must provide the disclosure to a buyer)
A buyer must receive a copy of the disclosure before signing a sales contract
A real estate broker acting as a seller's agent may (advise the seller of the best manner of taking title to the new property they are purchasing, attempt to create or encourage an offer from another buyer, disclose to a buyer that the client will accept a offer at the listed price and terms, modify the listing contract on behalf of the seller if it is in the seller's best interest)
A broker actin gas an agent of the seller is required to use his or her best effort to market the property and locate a ready, willing, and able purchaser. Attempt to create or encourage an offer.
A condition or contingency in a contract can be waived by the
party benefiting from the condition
Salesperson Sue has just completed a pre-printed purchase agreement with her client buyer Bob. The agreement includes a good faith deposit of 5k in the form of a check, which Bob has give to Sue. Absent any specific instructions, what should Sue do with Bob's check?
Turn it over to her broker immediately
Real estate fees or commissions are (determined by local board or association, mandated by the state's rules and regs, mandated by statutory law, negotiated between the client and broker)
negotiated between the broker and client
All four of the real estate licensees who work for Joe Wilson, owner of Wilson Realty, have passed the NY real estate broker's exam. How many licenses must be hanging on the wall at Wilson Realty?
Great Resorts realty is offering the chance to enter a drawing for a free weekend at a timeshare in the Catskills. Their advertising must contain...
Great Resorts cannot promote real estate with a game of chance
Which statement about a brokerage's main office is false (it must have a sign that clearly identifies it as a real estate business, it must have a supervising broker, it may be a virtual office with a PO box, it amy have an unlimited number of branch offices)
It may be a virtual office. The main office MUST be a actual, physical location
Louise, the owner of LKR realty, has three salespeople working for her brokerage. She has little time to supervise, but she is confident in their ability. Can she draft a contract that clear states that she is no longer responsible for any errors or omissions that her salespeople make?
Who does not require a real estate license?
A person who buys and sells houses as FSBOs (for sale by owner)
Can a person advertise their business under any name other than their own?
No, all advertising must be under the exact name under which the brokerage is licensed.
What is the term of office for an appointed member of the State Board of Real Estate
Who cannot be a member of the state board of real estate? Someone who has been a licensed real estate salesperson for 10 years, executive director of the consumer protection board, a member of the general public, the secretary of state
a person with a real estate license for 10+ years
Can a person with a real estate license work for two different brokers in different parts of the state?
Yes. They cannot hire other salespeople or supervise a branch office.
Karen is found guilty of practicing real estate without a license. If this is her third offense, what is the max penalty that the DOS could impose?
All are required to be included in ay ad placed by a broker except the broker's....Identification as a broker, license number, name, phone number
Broker Alice, owner of Ace Realty in Queens, just opened a branch office in the Hamptons. That office must... have its own manager, have its own supervising broker, have a separate branch office license, maintain its own separate escrow account
have a separate branch office license
Is a supervising broker required to personally negotiate every listing agreement initiated by his agents?
No. Salespeople work directly with clients. He should maintain open channels of communication, be responsible for their actions, regularly review the practices and performances of the agents
Which of these penalties would the Department of State not impose for a violation of the real estate rules and regulations? (fine, imprisonment, revocation, suspension)
Liscensee Terry works very hard to convince Spencer to list his house with her. She knows that to show well, the walls need to be painted and the carpet needs to be replaced. Terry recommends a company to do the work. can Terry accept a fee from "Ultimate" (the company) if Spencer hires them?
Yes, if Terry discloses the referral fee in writing to Spencer, she can accept the fee
Broker Rob and Bonnie are having dinner when Bonnie mentions she's having trouble getting listings in a particular part of town. Rob says he's happy to handle all listings in that neighborhood if she agrees to quit trying to land clients there. In exchange he'll send prospective clients her way if they live closer to her business. This is an example of: boycotting, market allocation, price fixing, tying in
Anti trust laws are in place to ensure that
Competition in the marketplace is fair an unrestrained
Gary is one of three brokers recently convicted of illegal boycotting. What did Gary and co do?
They avoided showing listings by Discount Dan
Who is legally responsible for completing a form disclosing material facts about property that's for sale?
The seller only.
If you have a client who questions your firm's commission fee, you should not:
refer to the pricing policies of the local association of Realtors, since that would violate antitrust laws against price fixing. Instead you could defend your firms prices, present prices to the client in a way that shows they are established independently, point out the value of services
Which circumstance that terminates an agency relationship could potentially involve a breach of contract? (renunciation, operation of law, mutual agreement, accomplishment of purpose)
Broker Greg practices designated agency at the outset of every agency agreement. Kim and Jeff are both salespeople working for Greg. Kim has a buyer client interested in Jeff's listing. Who is a dual agent in this scenario?
Greg and everyone of his other affiliated licensees
Felicia is buyer's agent who finds a home that offers 3% commission to a broker who finds a buyer. She finds "Kevin" who makes an offer through her. What is the seller's relationship to Felicia? (agent, client, customer, principal)
You met Tom to discuss his house. You went over the New York 443 Disclosure Form and he signed it that day. You did not get a listing agreement with Tom though. When can you discard his Disclosure Form?
After three years.
When should a agency disclosure be discussed?
Prior to the exchange of any confidential information, like discussing her buying/rental timeline and financial situation
What is market allocation and is it legal?
When two or more brokers conspire to divide their customers in any way they are guilty of violating antitrust laws
What duty is an agent breaching when she appears to be advocating for the customer?
An agent should disclose his or her compensation arrangement in each of these situations except if...the agent in a dual agency receives compensation from both parties, an agent receives a referral fee from the mortgage company, a buyer's agent receives a bonus from the listing agent for submitting an offer by a certain date, a listing agent gets a bonus from a client for selling at the listing price
A listing agent gets a bonus from a client for selling at listing price; agents are not obligated to disclose a bonus they receive from their clients. Dual agency should always be disclosed, and referral fees like this should never be accepted.
The purpose of antirust laws is to
prohibit any restrain on trade. The Sherman Antitrust Act made any restraint on free trade illegal
Howard walks through a home listen by Owen's agency during an open house. Howard and Owen chat some about the features of the home, Howard seems interested. The next day, Howard calls Owen and tells him that he'd like to make an offer on the house. What type of relationship do Howard and Owen have? What is Howard to Owen?
His customer. They do not have a fiduciary relationship. The seller of the home is Owen's client.
Can a broker represent both parties in the same transaction without being a dual agent?
No, it would be a breach of the broker's fiduciary responsibility
In NY, which property listing would require presentation of the 443 Disclosure Form? the lease of one condo in a four unit building, the sale of a free standing building in an industrial park, the sale of a lot in a subdivision, the sale of a one unit in a two unit office
The sale, lease, or transfer of residential property requires the presentation of the 443 Disclosure form
Who will not always work on behalf of the seller?
A selling agent is the one who procures the buyer. It could be a buyer's agent, in which case, the seller would not be the client
What type of agent is a real estate licensee considered to be in the broker-seller relationship?
Rick was the buyer's agent for Tom, whose offer for Jim's house was countered with an amount 10k below list price. This was still more than Tom wanted to pay. Tom found another house and bought that instead. Now Rick is buyer's agent for Harry, who wants to put an offer on Jim's house. Can Rick tell Harry that Jim would accept 10k below list price? Why or why not?
No, Tom's negotiations with the seller are confidential
Tate employs broker Lori to sell his house, promising a specified sum as her commission. Without informing Tate, Lori also acts for the buyer, who also promises a commission. When Tate discovers that Lori is acting for both parties, he goes through with the deal but refuses to pay her commission, and Lori sues. May she recover commission from Nate?
No, she breached her fiduciary responsibility
Patricia is a single mother with terminal cancer. She is going to transfer ownership of her estate to her best friend, Mary. Mary will hold the property and act as caretaker until Pat's daughter, Ellen, turns 25. At that time Ellen will inherit the estate. Who is the trustor in this arrangement?
Patricia is the trustor. Mary is the trustee and will hold the property title until the beneficiary, Ellen, turns 25.
Which type of business ownership does not protect the owner from the business's financial liability?
Groups of investors that pool their money to purchase large scale investments are called
Syndicates. This can refer to almost any form of business: a corporation partnership, and can hold real estate accordingly
Mark and Paula are married. They co-own a property with Tom as join tenants. Tom dies. What is Paula's interest in the property?
100% Joint tenancy allows co-owners to take ownership shares of a deceased co-owner automatically. Since Mark and Paula have unity of person, her interest is now 100%.
The unities of person, possession, interest, time and title are required for which type of ownership? (join tenancy, tenancy by the entirety, tenancy in common, tenancy in severalty)
Tenancy in entirety
The co-owner of an undivided interest in land with no rights of survivorship owns it by (absolute ownership, joint tenancy, severalty, tenancy in common)
tenancy in common
Ownership of property by one person is called
Real estate owned by the corporation is owned in (joint tenancy, partnership, severalty, tenancy in common)
severalty. A corporation is legal entity (artificial person)
If the title to the property is held for th benefit of a beneficiary, this legal arrangement is called
A and B take title together at the same time under the same deed, each owning half of the real property. What form of co-ownership will law presume they have?
Tenancy in common
Lucy and Ricky own half interest in a property as join tenants with Fred, who owns the other half. When Ricky dies, what happens to his interest in the property?
It belongs to Lucy upon his death
Ned is a co-owner of a property in Orlando. He is permitted to stay there only the first week of December and the third week of June every year. This type of ownership is called a
Groups of investors that pool their money to purchase large scale investments are called (cooperatives, group tenants, joint estates, syndicates)
Derrick purchase a fee simple interest in a house on the lake with a 8% interest in the parking area, reaction center, laundry room, and docks. What type of ownership interest did Derrick buy?
A condominium. Derrick has exclusive ownership of his cottage and shared interest in the common areas.
Which type of business entity pays a share of the profits to its beneficiaries?
REIT. The key word is beneficiaries, who are paid profit from a REIT, or real estate investment trust
A listing agreement is a contract between a seller and buyer, true or false?
False. A listing agreement is th contract between a seller and the listing broker
When appraising residential rental properties, when do you use the GRM (gross rent multiplier)?
with one to four units
gross rent multiplier: its . a number derived from comparable rental properties in an area that is used to estimate the value of a piece of real estate, the GRM is based on the total gross rent of a particular piece of real estate. In this method, no deduction allowance is made for expenses, vacancies, or collection losses
Sally asks her parents if she can move back home for a little while after going through a messy divorce. Her parents agree that she can move back home for a year, as long as she pays them 700 in rent every month. This is an example of: estate for years, periodic tenancy, tenancy at sufferance, tenancy at will
estate for years. With a deadline and rate, we have an estate for years. If it was only rent and no deadline, it would be periodic tenancy. With no rent or deadline, tenancy at will. Although they may suffer, no illegal possession is occurring.
Melina decides to sell part of her property to Bill. Once the sale is complete Melinda still crosse Bill's property to get to the main road since it is most direct. No written easement has been created. This is an example of: easement by agreement, easement by express reservation, easement by implication, easement by necessity
easement by implication
What is an example of a voluntary, specific lien? attachment lien, mechanic's lien, property tax lien, mortgage lien
Mortgage lien. They are the most common type of voluntary lien, a lien that results from a confession of judgement is also voluntary
You decide to build a house. You find a home that you want in a development complex and contract with Noah, to build the house. While the house is being built, you get a mortgage from a local bank. After the house is built, you close on your new home. What type of lien do you have after the closing? developer's lien, mechanic's lien, mortgage lien, tax lien
Mortgage lien, which is placed on your home until the mortgage is paid off. You don't have a mechanic's lien since you aren't doing an improvement on an existing home.
A similarity between an easement and a license is that both
Grant someone access to another's property
You own 20 acres of land in the mountains. You decide to deed the land to your only living relative, your niece. However, you want to make sure that the pristine beauty of the property is not marred by development, so you indicate that at least 10 acres mist remain with the property. This is an example of
Free simple defeasible. Since you put a condition on the property, you limited what could be done with the property. This type of freehold estate is also called qualified fee.
What is an example of an involuntary, general lien? (IRS tax lien, mechanic's lien, mortgage lien, special assessment lien)
IRS tax lien. There are a few liens that are involuntary general liens: some judgement liens and some tax liens, such as lien for unpaid tax income
Which is not an example of leasehold estates? (estate for years, estate from year to year, servient tenement, tenancy at will)
servient tenancy. Servient tenement is the name of the property that carries the burden of an easement.
The city determines that new sewer systems need to be put in your neighborhood. If you don't pay your share of the bill, a lien will be put on your property. What type of lien is this?
Special assessment lien. Special assessments are taxes on specific properties for improvements that benefit just that property, like sewers and street lights
What do a lumber company, a property tax collector, a painter, and a mortgage bank have in common?
They can all put specific liens or financial encumbrances on your property
Jake purchases a house, get a loan from his aunt and a mortgage. His aunt's loan is recorded May 1 and the mortgage is recorded by May 31. Jake builds a deck in June, and then goes to Hawaii for months. He doesn't pay the contractor or his property taxes. His property goes to foreclosure. In what order will the liens be paid?
Tax lien, aunt's loan, mortgage lien, mechanic's lien. Property tax liens also take precedence over any other liens. The remaining liens are paid based on the order they were recorded, which is why his aunt's loan is paid second.
What are the two main classifications of possessory estates?
leasehold and freehold estates. Feudal and allodial are different ownership systems. An easement is a non-possessory interest. An estate for years is a type of leasehold estate and a life estate is a type of freehold estate.
Yolanda owns some land in the mountains of NY. Jim started living on Yolanda's land in 2000. The soonest that Jim could acquire the title by adverse possession is:
2010. It takes 10 years to acquire the right to claim title by adverse possession. This is according to statutory law in NY.
Which of these situations would not result in a tax lien? A court determines you have to compensate your neighbor for cutting down a tree, you failed to pay the irs, you have to pay for the new sidewalks in your neighborhood, your school district passes a levy against property to raise money for renovations for school buildings
paying the neighbor. This is a judgement lien, not a tax lien.
Rich rents a house from Allison for a year. At the end of th year, he refuses to move out. This is an example of...
tenancy at sufferance
Darrell has a written agreement to drive across Lin's property to get to his own. This is an example of: a appurtenant easement. where Darrell's property is the dominant tenement and Lin's property is the servient tenement; defeasible easement, which puts a condition on Darrell to follow the rules of Lin; easement in gross, where the easement is attached to Darrell and he can't transfer the easement if he sells the land; encroachment, since Darrell is allowed to encroach on the rights of Lin
Appurtenant easement burdens one property, the servient tenement (Lin's property), for the benefit of another property, the dominant tenement (Darrell's property). Darrell is allowed to cross the property (nonencroachment).
Examples of encumbrances are.... easements and appurtenances, easements; easements, encroachments, and liens; licenses, encroachments, and liens; non possessory interests such as easements and liens
encumbrances are non possessory interests such as easements and liens
Brian has an appurtenant easement that allows him to cross over his neighbor's land to get to the lake. When the neighbor sells his land to Brian, the easement is terminated through
merger, since the two properties have been combined under one owner
Nick s a non resident owner of 300 acres in a rural township. Terry starts using eight acres of Nick's property for riding; he makes trails and puts up a stable and cabin. Everyone around knows Terry and they assumes he owns the land. After the statutory time period, Terry acquires title to the land. This is an example of
Adverse possession. Terry is adversely possessing Nick's land, which is open and notorious, hostile and adverse, exclusive and continuous use of another's land for a specific period of time
Which is not an example of an encumbrance? (a gas company's right to enter your property to fix a leak, a mortgage lender placing a lien for non payment, a neighbor driving across your property to access the road, a neighbor's shrubs hanging over your property line)
Rich rents a house from Allison for a year. At the end of the year he refuses to move out. This is...
Tenancy at sufferance...where tenant once had the right but now possesses it illegally.
David' parents let him move back in a for a while to help him get back on his feet. Unfortunately, David acts like he is back in high school: doesn't pay rent, has expectations for food on his mother. This is (adverse possession, estate for years, tenancy at sufferance, tenancy at will)
tenancy at will (there is no rent or specific end to tenancy)
Adam and Jenny enter into an agreement wherein Adam will buy Jenny's house at th
e asking price if Jenny will install a new roof and if Adam can qualify for a loan sufficient to cover the purchase. Until the roof is installed and the financing obtained, the contract is said to be (executed, executory, rescinded, voidable)
A voluntary agreement between legally competent parties to perform or refrain from performing some legal act, supported by legal consideration is referred to as (an assignment, a contract, a counteroffer, an option)
Walton decides to sell his cabin on the lake and offers it in a letter to his regular postman, Bill, at a price of 5k. The next day Walton receives a note from a neighbor, a close friend of the postman, who says "I accept your offer" Is Walton obligated to sell to the neighbor?
No, because only the offeree can accept an offer
Carrie, age 17, is selling the house that she inherited from her grandparents. George has agreed to buy the property, and both have signed a purchase agreement What is the status of this contract?
voidable by Carrie, because she is not of legal age; however George can't
The purchase of contract normally has three purposes. Which is not a purpose of the purchase contract (authorization to run a credit report on the buyer, buyer's offer, contract between the buyer and the seller, receipt for the earnest money deposit)
authorization to run a credit report on the buyer
Which statements about a option to purchase agreement is true (it binds both the buyer and seller, it binds only the seller, it is generally limited to a fixed price within a specified time period, it requires option money to be refunded if the buyer does not buy)
it is generally limited to a fixed price within a specified time period
Judy signed a one year percentage lease with Sam, He agreed to provide her a specified place in his store to display and sell her merchandise beginning Sep 1. Judy told Sam, on August 20, that she had changed her mind and would not move her stuff into his store nor pay him rent. What is this called?
anticipatory repudiation ( anticipatory breach, is a term in the law of contracts that describes a declaration by the promising party to a contract that he or she does not intend to live up to his or her obligations under the contract.)
Peter leases space for his ice cream shop in Stella's building, he pays her 800 a month in rent plus a portion of his profits. Its been a cold summer and no one wants ice cream. When Peter's gross sales fall below a specified point, Stella reclaims possession of the space. What kind of lease does Peter seem to have?
What is the term for when an offer is terminated or withdrawn before the offeree accepts it?
Seller Joe's agent personally delivered Mary's offer to buy his house. Later that week, without making a change in the contract, Joe signed it. Then he addressed it to Mary and went to the post office and mailed it. Is the contract binding on both parties?
Yes, because Joe sent it to Mary in the mail
Brain fell in love with the 50 acre farm as soon as he saw it. He signed the purchase agreement and his offer was accepted by the seller. A few days later, the seller changed his mind and decided not to sell the farm. What can Brain sue for to force the seller to sell the farm? (right of rescission, compensatory damages, specific performance, liquidated damages)
A purchaser agrees to pay $600 a month for ten years to buy a property and agrees to pay all real estate taxes, insurance premiums, and regular maintenance costs. The seller will hold legal title to the property even though the purchaser will live there. This contract is best described as...
Which of the following is not a requirement for a valid contract (acceptance, accord and satisfaction, consideration, lawful and possible objective)
accord and satisfaction
Lucy leases a storefront for her candy business. The rent for the first six months was $500 and set to increase by 10% every month for the next 18 months as the business takes off. What kind of lease does Lucy have?
A graduated lease
Bonnie is renting a house from Clyde. She pays Clyde 1.1k each month and is responsible for paying all utilities at the house. Clyde is responsible for repairs and property taxes. her lease is most likely a
There are four court enforceable remedies for breach of contract; compensatory damages, liquidated damages, specific performance and
Dr. Gitwell pays his landlord rent for his office and also pays all of the utilities bills for the office. His landlord pays the property taxes, mortgage, and insurance. What type of lease is this?
a gross lease
A subdivision developer employs agent Sue to sell lots. John offer to buy lot B-3 for 20k and the sales contract is executed. However, through a typographical error, which no one noticed, the contract identified the lot as D3 (which was listed at 25k) What is the contract status?
The Statute of Frauds is a statutory law that requires contracts regarding real estate to (be in writing to be enforceable, have a definite expiration date, have adequate consideration, include a non-discrimination clause)
be in writing to be enforceable
Melissa went to the dry cleaners and dropped off her good wool coat to be cleaned. When the clerk accepted the coat, Melissa and the dry cleaning operation had just entered into what type of contract? (complete, express, implied, unilateral)
Marvin contracted with Walsof Plastic Co to install vinyl siding on his house. The contract stated that the company would install ACME Type A siding. However, due to shortages, Walsof Plastic Co could not obtain that particular siding. Marvin agreed to a substitution of the vinyl from another manufacturer. This is an example of (accord and satisfaction, part performance, specific performance, substantial performance)
accord and satisfaction
Once a contract is terminated, it is considered
When there is a mutual agreement of the offer and acceptance, this is called (acceptance, consideration, contingency, meeting of the minds)
meeting of minds = mutual agreement
Shirley was under psychiatric care and declared incompetent in March. She signed a purchase contract o buy Joe's house two months later. What was the status of the contract when she signed (unenforceable, valid, void, voidable)
Zach is going to college. His parents sign a four year lease for an apartment on campus. This first year, the rent is 450 per month. Each year, the rent will increase by 50 per month. What kind of lease is this?
The purchase contract normally has three purposes. Which is not a purpose of the purchase contract? (authorization to run a credit report on the buyer, buyer's office, contract between seller and the buyer, receipt for the earnest money deposit)
authorization to run a credit report
Daphne, a victim of identity theft, can't currently qualify for a loan but wants to buy her friend's condo for 90k. She could give him 1k now, if he promised not to sell it to anyone else in the next six months. This is what type of agreement (lease purchase agreement, an option agreement, a purchase contract, a right of preemption)
Most typical lease used in a residential rental is a....
Johannsen signs a contract to sell his home to Smithson. At the closing, Johannsen gives Smithson a general warranty deed. In this situation, Johannsen is the (grantor, mortgagee, obligor, trustee)
grantor. The seller is giving or granting the deed. The buyer is the grantee
Lisa has a contract to buy Bill's house for 150k. She made a 6k earnest money deposit, which was specified to be used as liquidated damages if necessary. Lisa does not show up at settlement. It takes Bill six month to find another buyer, who offers him on 134k. How much can Bill sue Lisa for in compensatory damages?
Bill can sue for compensatory damages, which is the amount he lost (16k) minus the liquidated damages he should have already recovered (6k)
What is something of value given to induce another into a contract
Consideration. It can be anything of value such as money, services, goods, or promises
Larry bought a house on a land contract. Under this contract, he (has equitable interest in the property, will not have to pay any interest charges, will not live at the property until it is paid for, will receive the title to the property immediately)
has equitable interest in the property. Under a land contract the buyer will not receive title to the property until it is paid off. The buyer holds equitable interest in the property until then.
Top Cuts Lawn Service has an agreement to mow all of Lots of Wealth Realty properties for sale. Top Cuts is now concentrating their efforts on the east side of town, and so they have assigned the properties on the west side of town to another lawn service. Who is liable under an assignment?
Top Cuts remains secondarily liable. The original party remains secondarily liable under an assignment
To form a valid contract, there must be an offer and (acceptance, assignment, contingency, counteroffer)
Isabel has an apartment that she no longer wants to live in, but she does not want to break her lease. Since the lease does not forbid it, Isabel transfers her right of possession to Sam for the rest of the lease term. What is this an example of (assignment, novation, sublease, or sandwich lease?)
assignment. When a tenant transfers his or her entire right of possession for the remainder of the lease term without transfer his or her entire liability under the lease
What is a novation?
a new contract
Francis wants to buy a house, but she's not sure where to begin. She enlists the help of an agent to help her find the right house and represent her through the purchase process. What type of contract applies to this situation? (buyer agency agreement, listing agreement, option agreement)
buyer agency agreement
A contract is defined as bilateral under which of the following circumstances?
A contract may be either unilateral (where only one party is bound to act), or bilateral -- where all parties to the instrument are legally bound to act as prescribed
Which situation provies the least liability to the original tenant? (assignment, novation, sandwich lease, sublease)
Which appraisal approach is least useful for a special purpose property? (cost approach, income approach, sales comparison approach, all are equally reliable)
sales and comparison approach
Considering the highest and best use of land is important (only when the site is vacant, only in the analysis of developed property, only when land is ready for rezoning, in every appraisal)
In every appraisal
Which of these properties do you think is the best example of a piece of real estate being put to its highest and best use? ( a corner parking lot in an area with ample parking, house in a residential subdivision, an old house with commercial development on both sides, a vacant lot?)
The house in a residential subdivision, it represents the best example (other properties would most likely be able to put to a more lucrative use)
Using appraiser Maria's notations, determine the final estimate of value using the cost approach: Replacement Cost= 465k, deterioration =32k, site value = 85k
Formula for determining value using cost approach is reproduction/replacement cost- accrued depreciation + site value= Property Value. 518k
Which homes should an appraiser consider when finding comps? (homes currently listed for sale in the market, homes where the listing agreements have expired, homes that have sold recently in the subject's area, homes that were taken off the market)
Homes that have recently sold in the subject's area
Paul is doing an appraisal for Fannie Mae. What is the minimum number of comps he needs to consider when using the sales comparison approach?
Three. This is required by most secondary market lenders to ensure an accurate appraisal from sufficient data.
The second bedroom of a house must be accessed through the first bedroom. This is an example of...
Functional obsolescence (when a building is less desirable because of something inherent in the design)
Complete the following statement. A competitive market analysis is (---) the equivalent of an appraisal
Never, not. Although a CMA is similar to an appraisal, it is never equal to an appraisal
For which property would the gross rent multiplier method be appropriate ( a single family home that is owner occupied, a duple, a retail complex with three units, an apartment building with five units)
a duplex. The gross rent multiplier method can be used only for residential rental property for one to four units
External obsolescence can be seen in... peeling paint, outdated floor plan, basement that leaks, location in a declining neighborhood
neighborhood. Something outside the control of the property that makes it less desirable.
When using the sales comparison approach to arrive at an opinion of value, an appraiser: looks into the future to anticipate the home's appreciation, looks at current prices of all homes on the market in a neighborhood, looks into recent past to analyze similar sales, looks into past to see what an owner originally paid)
looks into recent past
An appraisal is...
is an opinion of value based on the typical buyer
Adjusting properties involves (changing the base to make it more like the comps, changing the comps to make them more like the base, always using comps that are exactly like the base, finding comps that sold for the same price)
changing the comps to make them more like the base. The subject property is your base and each comparable is then compared to the subject. The subject never changes.
After freeway construction, a home experiences noise from traffic
Vincent is tasked with deriving the value for a large, custom home that was constructed nine months ago on a secluded 10 acre lot. Which approach could be considered the most reliable for valuation?
Cost approach. It is an objective method to provide an accurate value for replacing or reproducing buildings, especially new or nearly new buildings with few comparable sales
The primary purpose of a competitive market analysis is to determine...
A range of probable selling prices for a homeowner.
Adding or subtracting to a comparable to develop an opinion of value is called
Appraiser Jack has been contracted to determine the value of a large apartment building for a potential investor, which appraisal method is probably the most useful for this situation?
Income approach. Always used when determining the value of investment property.
Market value can be best defined as a property's... appraised value for property tax purposes, listing price, most probable selling price, most recent selling price
Most probably selling price
The primary purpose of a competitive market analysis is determine
A range of probable selling prices for a homeowner
The subject property shows severe structural damage to a basement and foundation that would cost 40k to repair, This would only add about 25k to the value however. this would be considered...
incurable physical deterioration. Severe damage to basements, foundations, load bearing walls, roof trusses, or floor joists is usually considered to be incurable physical deterioration-- since these elements are not expected to need major repair during the building's useful life and repairs are expensive
A period of time during which a structure may reasonably be expected to perform the function for which it was designed is known as its
What is the first step in the appraisal process? ( collect and analyze relevant data, define the data and sources necessary to do the appraisal, determine the value of the land separate from the structures, state the problem)
State the problem by identifying the property an the purpose of the appraisal a well as any due dates
Sue is appraising a 20 year old bank building. Based on her research and analysis on the quality of the construction and the local conditions, she determines that the building should have an economic life of 50 years. She also concludes that the building has not been well maintained and has an effective age of 30. What is the remaining economic life?
20 years. Found by subtracting effective age from expected age.
Appraiser Jack has been contracted to determine the value of a large apartment building for a potential investor. Which appraisal method is the most useful (CMA, cost approach, income approach, sales comparison approach)
income approach, a valuable method when determining the value of an investment property
The value of an improvement is equal to
What it actually contributes in value to that piece of real estate
Title is passed once the deed is (acknowledged and recorded, delivered and accepted, granted and transferred, signed and delivered)
Delivered and accepted
An interest in real property created by the execution of a valid sales contract is called (equitable title, evidence of title, freehold estate, warranty deed)
A valid deed requires the signature of the (grantee, grantor, grantor and grantee, notary of public)
Which type of deed gives the grantee the most protection?
Which action transfers title? (Doug decides to give his property to his son Alex, Doug signs a deed that conveys title to Alex, Doug hands the signed deed to Alex who accepted it, Alex takes the deed to the county recorder's office to be recorded)
Doug hands the signed deed to Alex who accepted it)
A deed contains a guarantee that the buyer will not be bothered by other claiming title to the property. This is an example of which covenant...(against encumbrances, further assurance, quiet enjoyment, seizen)
Quiet enjoyment, guarantees that the buyer won't be bothered by others claiming title
Which one of the statements regarding special warranty deeds is not true (grantor only guarantees he didn't encumber the title during his ownership, special warranty deeds are also called grant deeds, these deeds are transferable and assignable, these deeds typically contain only one warranty)
That they're transferable and assignable, no deeds are transferable or assignable)
A habendum clause
follows the granting clause in a deed and includes a "to have and to hold" statement
Which statement is not true regarding a quitclaim deed: these are often used to clear clouds on a title, these offer the grantee the most warranty protection, they convey whatever interest the grantor holds in the property (if any), it may be used by a spouse to release dower interest not conveyed
These offer the grantee the most warranty protection. Quit claims deeds come with no warranties and provide the least amount of protection to the grantee
A court action to remove a cloud on a title is called a
suit to quiet title...resolves an ownership dispute when a lawsuit is filed
A written instrument transferring the grantor's ownership of or interest in real property is known as an
Who executes a deed?
Which type of deed provides the greatest protection to the grantee?
Full covenant and warranty deed
An owner may use all of the various deed of conveyance to voluntarily transfer his or her right, title or interest in a property. Which of the following may not be used/ (administrator's deed, deed in trust, quitclaim deed, warranty deed)
Administrator's deed is executed pursuant to a court order. This statutory deed is used to convey title to property that is transferred ny court order, not by owner
Each of these are synonymous terms to describe a deed that only guarantee the title against defects since the time the grantor owned the land and no before except a (deed of trust, grant deed, limited warranty deed, special warranty deed)
Deed of trust. Grant deed, limited warranty deed, and special warranty deed are synonymous terms for a deed with limited guarantees.
Which covenant is the promise in a deed that the seller is the owner of the property and the buyer has the right to possess it (against liens and encumbrances, quiet enjoyment, seizen, warranty forever)
Seizen: a promise or agreement of possession under a legal right is the covenant of seizen
Which type of legal description references a plat map to find the exact location of a property
Lot and block. A plat map is the detailed survey map of the subdivision. The lot and block system uses subdivision lot and block numbers
Which type of legal description used in the US is the oldest and most complex?
Metes and bounds. It is primarily used in the original 13 states, less so throughout the rest of the country
Lois is looking for a commercial property of approximately 8000 square feet that will give her the most access to the road possible. She's looking at these four properties (frontage price indicated) each selling for 6.40 dollars per square foot. She can't spend more than 50k. Which property is she most likely to buy A)70x120/$400 . B)80x100 /$600 . C) 90x90/ $550 . D) 120x65/ $460
D. It has the greatest linear feet of frontage (120) is the only choice with a sales price of less than 50k. ($49,920)
Cubic feet divided by -- cubic feet give you cubic yards
Rachel's lot is 150x300 and she wants to put up a picket fence around the whole perimeter. The fence costs $4 per yard. How much will the fench cost?
$1,200. The lot is 900 linear feet. The fence price is per yard, so divide the linear feet by 3 for linear yardage of 300. Then multiply by the price.
Jim buys a triangular shaped lot with 60 front feet. Each side of the lot is 100 yards deep. What is the square footage of Jim's lot?
9,000 square feet. convert depth from yards to feet 100x3= 300. Then find the square footage of a triangular lot by dividing the base of the triangle by 2 (60/2= 30) then multiply by the depth (30x 300 = 9k)
What do you obtain by multiplying length by width by depth?
A 20x30 garden will take 100 -- of fencing
Linear feet. The total length in feet around a perimeter.
In metes and bounds system, the ending point of the lot description is always the
Starting point. Define boundaries of the lot, moving clockwise, until returning to the point of beginning and enclosing the lot
A topographic map, Hill A has contour lines that are closer together than the contour lines on Hill B. This indicates that
Lou wants to build a 13.5 x 20 x 6 pool. The excavation will cost $40 per cubic yard. How much will this cost?
To find cubic yards, divide by 27 which is 60 cubic yards. At 40 dollars per cubic yard, cost is 2.4k
A 1.75 acres lot sells for 40 cents per square foot. What is the selling price?
30,492 dollars. 1.75 has 76230 square feet.
1 acre is 43,560 square feet
A 60x87 lot sells for $465 per front feet. What is selling price?
27,900. Only the front footage figures into the selling price 60x465= 27,900
Which document does not normally require a legal description of land? (deed, listing agreement, mortgage, title insurance)
A deed must be acknowledged in order to be
Recorded. It is valid and can convey title if it meets the requirements for a valid deed.
During a person's lifetime, title to real estate may be transferred by which method?
Involuntary alienation Descent, devise, and escheat are all related to someone's estate after death.
Which of the following is not an example of involuntary transfer of real estate?
Gift. Gift and sale of property are the most common ways title is transferred by voluntary alienation
A deed should be recorded in order to provide
Constructive notice to the world
The purpose of recording a document is to
Give notice to the public
A person who is named in a will to carry out the directions of the will is the
In Ny, home many years must one possess the land in an open, continuous, notorious, and hostile way before claiming adverse possession?
Oakville is in desperate need of a new sewage treatment plant to handle all new home construction. The city offers just compensation to 30 homeowners, tears down the houses, and builds the facility. The act of taking the houses and tearing them down is....?
An instrument which protects a homeowner against losses resulting fro undiscovered defects and encumbrances such as forgery in the record is a/an...
title insurance policy
A person preparing an abstract of title does which of the following: ensures the condition of the title, gives an opinion of title, inspects the county records for documents that may affect the title, issues a title insurance policy
Inspects the county records for documents that may affect the title
The abstract of title is a
chronological summary of the essential provisions of every recorded document pertaining to a particular parcel of land
Which type of title insurance policy will the lender hold
Title insurance protects policy holders from all of these defects except
An unrecorded lien that the buyer new about
Which type of evidence of title gives a homeowner or lender recourse if the title defects are later discovered?
Title insurance is the only one that protects against defects in title
The post compete title protection is offered by a
Extended coverage policy
To find out whether there is an encroachment on a property, a person should purchase
A survey. This shows any physical encroachments upon the property
Rick gives Jill a quitcliam deed. A title insurance company issued a policy indicating that Rick had clear title to the property. Three months later, a mechanic's lien against the property for 12k is discovered. The court orders Jill, as owner, to clear the lien. Who should Jill go after to recover the money?
The title company only. Quitcliam deed frees Rick of liability, but the title company is responsible for insuring that the title was free of unknown encumbrances
You find out that the house you grew up in is for sale. The seller tells you that there's a 5k lien on the property that he has no interest in paying, but he'll sell it to you with the lien. The title insurance company will treat that lien as an
At what point does a deed transfer a grantor's interest to a grantee?
Upon delivery and acceptance by the grantee
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