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Terms in this set (120)
Margie listed her real estate for sale at $100,000. If her cost was 80 percent of the listing price, what will her percentage of profit be when her real estate is sold for the listing price?
Mark has a permanent right of way across the neighbor's property to get to the street. Mark owns an
Once a sales contract is signed, the buyer is said to have
In the event that it is necessary for landlord Charise to remove a tenant from the premises, she does it by
filing a suit for possession.
Gordon has defaulted in the payment of several of his debts, and the court has ordered his property sold to satisfy them. A title search revealed several outstanding liens against the property. Which of the following liens has highest priority?
A real estate tax lien for the current year
Norman agrees to purchase Gusela's property for $185,500. He deposits the purchase price with Vincent, and Gusela deposits a warranty deed for the property with Vincent. Vincent is instructed to record the deed in Norman's favor when Gusela shows good title to the property. Vincent is also instructed to pay the purchase price, less some agreed prorations, to Gusela when Norman has receivedthe deed. This transaction is called
An agent lists a property for sale. The agent finds a buyer who makes an offer that is accepted by the seller. The agent receives a commission
only if there is an act of sale
An investor recently paid $500,000 for a building that yields $65,000 in annual income. The investment's cap rate is
The condition of the seller's title is generally determined from an
title commitment or abstract of title
The lessee pays rent and also pays property taxes, insurance, and maintenance. This is an example of a
Kandace is interested in a house that fits most of her needs, but it is located in a busy area where she is not sure she wants to live. Her concern about the property's location is called
A real estate contract whose basic terms are vague would be held in court to be
Which of the following is considered an escrow agent in a loan transaction?
Which of the following would best be handled by a property manager?
A shopping center
The seller agrees to sell the house to the buyer for $100,000. The buyer was unable to qualify for a mortgage loan for this amount so the seller and buyer enter into a contract for deed. The interest the buyer has in the property under a contract for deed is
Earnest money accompanying a purchase offer
is not necessary to establish a valid contract.
Quitclaim deeds are most often for
clearing title defects.
Last month broker Wanda took a listing on a property. She now learns that her client has been declared incompetent by the court. Her listing now is
A property is valued at $85,000 and assessed at 50% of its value. The tax rate is $3.50 per one hundred dollars of value. How much are the taxes?
Any qualified person wishing to obtain a mortgage loan for the purchase of a home may obtain any of the following types of loans except a
reverse annuity mortgage.
Mr. Mole's house has been listed for sale for more than one year and he is very anxious to move into a retirement community. Salesperson Rachel, who is a subagent of the seller, tells a prospective buyer to make a low offer because she is sure that the seller will accept it. Regarding Rachel's conduct, all of the following would be true except
she acted appropriately to get the seller's property sold.
Real estate as an investment has many advantages. One disadvantage most commonly found is
An agent is to disregard instructions from a principal when those instructions
An appraiser may establish value by all of the following methods except
tax assessment approach.
In February, the Mary and John Peters accepted an offer to sell their house to Polly Gross. In April, Polly paid the purchase price and received the deed to the house. After April, their contract is considered
A quitclaim deed
conveys no interest in the property.
Broker Joan shows properties listed for sale with her company to prospect Karl. Karl has refused buyer representation. Karl is Joan's
In an old retail building, which of the following would most likely be a source of incurable functional obsolescence?
Closely-spaced internal support columns
Broker Kenneth arrives to present a purchase offer to Dorita, an invalid, and finds her son and his wife also present. In the presence of Broker Kenneth, both individuals persistently urge Dorita to accept the offer, even though it is much lower than the price she has been asking for her home. If Dorita accepts the offer, she may later claim that
she was under duress from her son and daughter-in-law, and therefore, the contract is voidable.
Brokers get together and divide their market area by regions. This is
illegal and a violation of antitrust laws.
Kahlid has been making periodic payments of principal and interest on a loan, but the final payment will be larger than the others. This is a
balloon payment loan
What is the purpose of the deposit in a real estate transaction?
Provides evidence of the buyer's intention to purchase the property.
the government's right to restrict how you use property is called
An acre contains
43,560 square feet.
Which of the following must be proven in a Fair Housing complaint?
The intent was to discriminate.
Terry Adams asks Geri Jones, a real estate salesperson, to assist in setting the price for his home. Geri will prepare a
competitive market analysis.
Services offered by computerized loan origination (CLO) systems are permitted under RESPA as long as certain conditions are met. Which of the following are prohibited under RESPA?
mortgage brokers may pay a referral fee for the mortgage loan.
All the following clauses in a loan agreement enable the lender to demand the entire remaining debt be paid immediately except a
one of the best methods for an agent to use to avoid a discrimination lawsuit is to
keep detailed records of people you worked with and what properties they were shown.
A seller of an installment sale wants to make sure he gets his money back if the buyer sells the property before completely paying off the mortgage. This can be accomplished by making sure the contract contains a
due on sale clause.
Property taxes on the sale of a property are paid in advance. At the act of sale, which of the following entries will be made?
Credit seller and debit buyer the same amount
Several brokerage firms agree not to cross over into each other's teritory and further agree to charge the same commission rate. Which of the following statements is true regarding these agreements?
This violates antitrust laws.
Express covenants that protect the grantee are found in a
The FHA does which of the following on a regular basis?
John rents a small builind for his tattoo shop. In addition to rent, he also pays property taxes, utility bills, and insurance on the property. John has a
A buyer and seller enter into a binding agreement to sell a house. The seller then refuse to sell the house to the buyer because they decide they want to continue living there. Which of the following principals of law will be used to sue the seller?
For tax purposes, the relationship between a broker and salesperson is typically that of an
Broker Sven, in the course of selling a home to customer Nancy, told her that the foundation was "solid as a rock" when he knew for a fact that it was slowly sinking into the landfill on which it was built. Now that the sale is settled, which of the following is least likely to happen to Sven?
Successful defense against all charges based on loyalty to his client-seller
Which of the folowing is most likely to be used in a competitive market analysis?
date of sale
Salesperson Nellie finally concluded some extremely difficult negotiations that resulted in the sale of a listed parcel of land. For all of her extra efforts, she can legally receive a performance bonus from
A contract that gives you the right to buy the owner's property at a fixed price within a certain period of time is called an
An appraiser has been employed to estimate the market value of a parcel of vacant land. The resulting appraisal report would not include reference to
the listed price of the parcel.
mixing funds held for others with one's own personal funds.
Mary Kay and Don John are not married. They purchase a home together but want to make sure that when one of them dies, the other becomes full owner. The deed must identify them as
joint tenants with the right of survivorship.
A seller confides with his agent in a conversation that he is willing to take less for the property under certain conditions. Which of the following is true?
The agent should continue to present the property under the original terms of the listing.
An assessment role is confirmed after an agent got a listing. The assessment is to be paid in 5 equal installments including interest as researched by the agent. The agent is
required to inform potential buyers that there will be a special assessment lien at the transfer (closing).
The discount points paid at a closing are based on the
Monuments in a metes and bounds description are
The disadvantage of amortizations with a balloon payment is which of the following?
The last payment is large, and if you cannot pay it, you may be foreclosed on.
An abstract of title contains
the summary of a title search.
Tonya leases store space to Klem for a restaurant, and Klem installs his ovens, booths, counters, and other equipment. When would these items become real property?
If Klem does not remove them at lease expiration
A husband and wife of a single family home are allowed to keep up to $500,000 of the profit on the sale of their principal home
if they have lived in the property at least 2 of the last 5 years before the sale.
Mary Berry is single. She sells her home of the past ten years. How much capital gain can Mary realize without owing any federal income tax?
Abel and Baker are joint tenants. Baker sells his interest to Charlie. What is the relationship of Abel and Charlie?
They are tenants in common.
Broker Peder listed the Kleins' property for sale under an exclusive-right-to-sell agreement. Today, Toby, one of Peder's salespeople, obtained a signed offer to purchase the property along with a certified check for 5 percent of the purchase price as earnest money. What should Toby do with the earnest money check?
Give the money to Peder for deposit in the brokerage trust account.
A building is valued at $215,000 and contains 4 apartments that rent for $470 each per month. The owner estimates that the net operating income is 65 percent of the gross rental receipts. What is the capitalization rate?
The entire history of a piece of property is known as its
LaShawn has just made the final payment on her home mortgage to her lender. There will still be a lien on her property until the lender records a
satisfaction of mortgage.
A broker employs several salespeople, one of whom, Mary, is a member of a protected group. The broker directs her to work only with members of her group and to solicit sales only in similar neighborhoods. Which of the following is correct?
The practice could establish or continue the unlawful practice of steering.
A cooperative is best described as owning
shares in a corporation.
Homeowner Gurney acquired ownership of land that was deposited by a river running through his property by
When showing property to a prospective purchaser, an agent tells the purchaser that this is the nicest house in the neighborhood. After buying the house, another house in the neighborhood sells for more money and the buyers of the first house realize that the other house is a nicer house. In this situation, the agent is guilty of
A major difference between a cooperative and a condominium is that
you own and finance your own condominium unit.
An agency is best described as the relationship between the
broker and principal.
A husband and wife own property that states when he dies she gets total ownership. What type of tenancy is this?
Tenancy by the entireties
An owner signs a lease on a building and then sells the building. Which of the following is true?
The lease passes with the building to the new owner.
The Levines sold their vacation home for $188,000. If they made a profit of 10 percent, what was the original cost of their property?
A property has a tax bill of $1,080 that has not been paid. If the sale closes on March 31, what would the proration be?
A broker agrees to accept as fees any monies received over a stipulated amount. This is an example of what type of listing?
Sandra's son starts college soon. She has lived in her home for 10 years. What financing option would be preferable for Sandra to obtain funds to pay for her son's schooling?
home equity loan
Which of the following best describes a counteroffer?
It rejects a previous offer.
A deed is used to convey ownership of
Victor and Norman are co-owners in fee simple of a small office building. Norman dies intestate and leaves nothing to be distributed to his heirs. Victor is neither related to Norman nor his creditor. Which of the following would explain why Victor acquired Norman's interest?
John walker refuses to sell his property to the state, which needs his property to build a new section of highway. The state may go to court to ask for the property to be declared condemned. If confirmed by the court, the state will be allowed to purchase the land using its right of
Salesperson Norman wants to be classified as a qualified real estate agent, the equivalent of holding independent contractor status. All of the following are requirements for him to meet except a. receive substantially all of his income from the brokerage based on
be free from supervision by his broker and office manager
The Tolson's apartment lease has expired, but their landlord has indicated to them that they may remain on the premises until a sale of the building is closed. They will be charged their normal monthly rental during this period. The right held by the Tolsons is called an
tenancy at will.
A property is sold under a qualified fee that requires the property to be used as a bakery. The property is converted to a barber shop. Under these conditions, which of the following is true?
The seller may be able to get the property back.
Licenses, liens, encroachments, claims against an owner's property are known as
Zoning is usually done by
towns and cities
An appraiser has been hired to prepare an appraisal on a property that includes an elegant old mansion that is now used as an insurance company office. Which approach to value would the appraiser rely on most?
The Real Estate Settlement Procedures Act is administered by
Mr. and Mrs. Delong lease a two-bedroom apartment from Karos Management Company. Due to ordinary wear and tear, the dishwasher breaks down. Who must pay for its repair?
A rectangular tract of land measures 860 feet by 560 feet. This tract contains approximately how many acres.
A property is zoned to allow a gas station and is subsequently changed to allow residential only. Which is true regarding the future use of the gas station?
The gas station may continue in its curent use.
Which of the following is true about an exclusive right to sell listing?
If the seller finds a buyer for the property, the listing broker still gets a commission.
At the closing, Frank's attorney informed him that he would be giving credit to Vito, the buyer, for certain accrued items. These items represent
bills related to the real estate that have not been paid as of the time of the closing.
Broker LaRue's newest salesperson, Shandra, lists a unit in a condominium building for sale. In this transaction Shandra
acts on behalf of LaRue, her broker.
Mrs. Robinson has owned her house for over 50 years. It has fallen into disrepair, but because she lives on a fixed income, she does not have the money to make the needed repairs. She has a considerable amount of equity in the house. What type of loan best suits her needs?
A reverse annuity mortgage
The act of sale and the documents produced at the act of sale are based on which of the following?
"Starting at the point of beginning and proceeding along the northerly side of Common Street, 75 feet from the north corner of James Street, then proceeding west 220 feet..." is the start of a
metes and bounds description.
A commercial property investment has a tax liability when the
income exceeds depreciation and expenses.
The difference between a property's market value and the sum of all liens against it is
When Homeowner Harry sold his residence recently, he found that he had more than $20,000 in equity. This equity did not come from
the use of an interest-only mortgage payment plan.
Personal property that becomes permanently attached and becomes part of the real estate is called a
Two brothers buy property together. Each wants to pass on his share of ownership to his children upon death. Their ownership is a
tenancy in common.
The landlord's lease prohibits tenants from altering the property in any way. A young woman who uses a wheelchair cannot maneuver over the doorstep into the apartment by herself. In addition, she cannot access the bathroom facilities in her wheelchair. Which of the following is true?
The tenant is entitled to make the necessary alterations.
External or economic obsolescence refers to loss of value due to
factors outside the property lines.
Joanne and Samuel are next-door neighbors. Samuel tells Joanne that she can store her camper in his yard for a few weeks until he needs the space. Samuel does not charge Joanne rent for the use of his yard. Samuel has given Joanne a
The evidence that you are the owner of a property is legally found in the
Which of the following values is most likely to set the residential price for a sale?
Broker Smith is helping a buyer and seller fill out a sales contract, but is not representing either party. Broker Smith is a
Subdivider Jonathan had a mortgage loan on his entire housing subdivision. When he sold a lot to a buyer, he was able to deliver title to that lot free of the mortgage lien by obtaining a partial release. What type of loan did the developer have?
Property ownership by one person is known as
A property lists for $125,000 sells for $117,000. The proprety is then appraised for $130,000. The buyer makes a loan of $100,000. If the buyer has to pay three points, how much will he/she need?
An appraiser is trying to establish value for a listing using sales comparables in the neighborhood. Which of the following is the appraiser least likely to consider in establishing the value?
Regulation Z requires which of the following information to be in the required documentation?
Information as to the total cost of credit in both dollar and percentage terms
The most common method used by real estate agents to establish a list price for a home is by
researching sales prices of similar homes.
To be entitled to a commission related to a real estate transaction, an agent must be all of the following except
under contract to either the buyer or seller.
A market analysis is not an
An agent is told by the seller that the property taxes are $1,500 per year. The agent is asked by a potential buyer how much the taxes are on the property. The agent should
tell the buyer they are $1,500.
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