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EXAM PRACTICE

Terms in this set (49)

Which kind of lease increases at specified intervals?GraduatedGrossPercentageNet
Graduated
Salesperson Larry is writing an advertisement for one of his listings. Which of the following phrases should he avoid?A) Desirable neighborhoodB) Apartment complex with chapelC) Mother-in-law suiteD) No wheelchairs
No wheelchairs
Alice is setting her goals. Which of the following would be considered an intermediate goal?A) I will complete the GRI certification in the next four yearsB) I will practice listing presentations twice a week with an experienced agent for the next two (2) months.C) I will open my office within nine (9) yearsD) I will distribute 200 business cards every month for the next six (6) months
A) I will complete the GRI certification in the next four years
Greg sold an apartment building he owned for 20 years. He paid $100,000 for it, and made $300,000 worth of improvements. His depreciation was $2,500 per year. He sold the building for $1,000,000 and paid $60,000 in commission to the broker. What is Greg's capital gain on the apartment?
$590,000
Who benefits from Private Mortgage Insurance?
The lender incase of a borrower's death
Which is TRUE about listings?A net listing is illegal in all states.An open listing is an exclusive contract.A seller can sell his or her own home and owe no commission if he or she signs an exclusive agency listing.An exclusive listing must always be at least 30 days long.
A seller can sell his or her own home and owe no commission if he or she signs an exclusive agency listing.
The Fair Employment and Housing Act is also known as
The Rumford Act
Jenny's home appraised for $550,000. Her asking price was $560,000 and the property sold for $575,000. What will the new owners pay in property taxes?
$5,750 the first year, plus a maximum 2% increase in market value per year
Jane sold her personal home for $148,000. Two months later she purchased and moved into a new home that cost $145,000. The adjusted cost basis of the first home was $140,000. For purposes of federal income tax, which statement is true?
A basis of $140,000 and no taxable gain
Jim and Jane are buying a home for $120,000. They have $20,000 for a down payment and assumed the seller's mortgage of $75,000. Jim and Jane financed the remaining $25,000 through the seller. What kind of a mortgage do they have?
Purchase-money mortgage
Which of these is not a buying signal?
Jim and Amanda whisper and frown when they see the basement.
An apartment manager seeks to evict a tenant for filing a discrimination complaint. What California Fair Housing law has the manager violated?
Rumford Fair Housing Act
The second installment of property taxes comes due on:
1-Feb
Amanda took a listing on Matt's home. In the listing agreement, Matt named North Central Title Company as the escrow company for the sale. When Amanda brought Matt an offer, the purchase contract named Anderson Escrow Company as the escrow company for the sale. If Matt accepts the offer, which company will handle the escrow?
Anderson Escrow Company will handle the escrow because Matt accepted the offer.
Jim has created a nice property flier for the James' home. Jim should not use this flier as a:
Substitute for advertising
According to income tax law, John could adjust the cost basis of his personal residence for which of the following items?
Cost of adding a new garage
Agricultural land includes all of the following EXCEPT which?
Parks
When conveying title to real property, what is needed to create a valid escrow?
A binding contract between the buyer and seller and the delivery of transfer documents to a third party.
Which law first prohibited discrimination based on race, color, religion or national origin?
Civil Rights Act of 1866
Mortgage lenders are required to provide an estimate of closing costs to a buyer and are prohibited from paying kickbacks for referrals under which law or regulation?
Truth in Lending
Which of these statements is not true?
Asking price is a good indicator of selling price.
Tom and Mary want to purchase their first home. Which of the following would be the least likely place for them to obtain a loan?
Insurance company
RESPA requires the use of the HUD Form-1 for which types of transactions?
Residential transactions financed by a federally-related loan
What value does tracking and following-up on Expired Listings provide?
Provides the community a snapshot of marketing trends.
Provides an opportunity for personal contact with a property seller.
Provides little value because the property did not sell in the market.
Provides the Real Estate Board an opportunity to improve listing records.
Provides an opportunity for personal contact with a property seller.
Grace wants to work with clients who are interested in time-shares. What property type will she be dealing with?
Recreational
Matt is computing the adjusted cost basis of his apartment building for income tax purposes. Which of the following items can Matt not add to the original cost when doing the computation?
Cost of a new parking lot
Installation of central air conditioning
Mortgage payments on the property
Addition of a tenant laundry facility
mortgage payments on the property
Lorna and Hal have obtained a growing equity mortgage for their new home. What does that mean?
The loan will be distributed to them gradually.
The interest rate will increase gradually over time.
The loan term will extend gradually over time.
Their loan payments will gradually increase.
Their loan payments will gradually increase.
Which statement is not true about an agency relationship?
It is based on authorization.
It is determined by who pays the compensation.
It is based on mutual consent.
It can exist without compensation.
It can exist without compensation.
What happens when the terms of a loan are satisfied?
The lender can keep anything left in the escrow account.
The borrower must get an appraisal of the property before the lender turns over the legal title.
The lender cannot charge a fee to close out the loan.
The borrower receives a release of mortgage document.
The borrower must get an appraisal of the property before the lender turns over the legal title.
The owner of an apartment building told his manager not to rent to an Asian family. Which statement is true?
The manager must follow the owner's instructions.
The manager should set up his screening process to check for nationality.
The manager should tell the owner that his request is a violation of fair housing law.
The manager should rent to the Asian family and not tell the owner.
The manager should tell the owner that his request is a violation of fair housing law.
An ____________ is a leasehold agreement that specifies an initial period of tenancy and the length of the agreement, but does not end after the specified period. This type of leasehold agreement renews automatically at the end of the term unless either party gives notice that they plan to terminate the lease. Some jurisdictions require the landlord or tenant to give 30 to 60 days' notice of such intent.
Estate from period to period
What is one of the primary purposes of the secondary mortgage market?a) Issue second mortgages.b) Lend money to banks.c) Pay off defaulted loans.d) Cycle back money to primary lenders.
Cycle back money to primary lenders.
Which of the following situations is not exempt from the seller disclosure requirement?
Greg Burns is selling his interest in his home to his wife Melanie as part of their divorce settlement.
Jim Sharp is purchasing his father's home.
The court has ordered the transfer of Sally Green's home to her friend Penny Jacobs as part of the settlement of Sally's estate.
All of the above.
x
Kirk wants to get an FHA loan. Which of the following is Kirk himself not likely to do during the application process?
Find a home that meets FHA requirements.
Agree to pay mortgage insurance.
Find a lender who is willing to do FHA loans.
All of the above.
x
Which of the following would not be an essential component when researching the purchase of an apartment building?
Analyzing neighboring cities.
Studying population trends in the area.
Analyzing the income potential of the property.
Understanding characteristics of the rental market.
Analyzing neighboring cities.
Which law extended discrimination to include handicap and familial status?
Jones v. Mayer
Housing and Community Development Act
Civil Rights Act of 1968
Fair Housing Amendment Act
Fair Housing Amendment Act
Sally and Dan must pay 2 points on their new $65,000 loan. What will they have to pay at closing for the points?
$650
$1,300
$1,950
$2,600
$1,300
Which of the following prospecting techniques do you have to use carefully because it has tended to upset people in recent years?
Facebook and Twitter advertising
Direct mail
Placing ads
Telephone calls
Telephone calls
Sharon and Steve have just taken a second mortgage on their home. Which is a true statement?
The second mortgage has now become the primary loan.
This mortgage is not negotiable.
They're probably paying a higher interest rate on the second mortgage.
The first and second mortgages will be rolled into one.
They're probably paying a higher interest rate on the second mortgage.
Mortgage lenders are prohibited from discriminating in giving credit to prospective borrowers based on race, color, religion, national origin, sex, marital status, age or dependency on public assistance under which law or regulation?
Equal Credit Opportunity Act
Truth in Lending
Real Estate Settlement and Procedures Act
Community Reinvestment Act
Equal Credit Opportunity Act
An agent open house can be especially significant for a property that:
Has just had the price reduced.
Is in an area where few homes are for sale.
Has unusual features or amenities.
Is overpriced.
Has unusual features or amenities.
Salesperson Carol arrives at the first showing she has scheduled with prospects Mark and Melinda. When Carol pulls in front of the home, Melinda decides immediately that she doesn't want to see the inside. What should Carol do?
Tell Melinda that the sellers will be very disappointed if they cancel the appointment.
Enumerate the home's special features and hope she changes her mind.
Call the sellers immediately and let them know you won't be coming by.
Emphasize that this home is a great buy and it would be a shame for them to dismiss it without looking first.
Call the sellers immediately and let them know you won't be coming by.
"Value" in real estate has what meaning?
Asking price well below market
The use of a parcel of land
The function a parcel might have to a number of people
The worth and use of a parcel to a particular person for a particular purpose
? asking price
What does Errors and Omissions insurance do?
Protects a buyer from a seller's claims.
Protects a licensee from a client's claim of negligence.
Protects a seller from a buyer's claims.
Protects a licensee from a client's claim of fraud.
Protects a licensee from a client's claim of negligence.
Which of the following is an example of an uninsured conventional loan?
A private loan from a bank guaranteed by the VA
A first mortgage through a credit union with a 75% loan-to-value ratio
A bank loan insured by the Federal Reserve
A first mortgage through a savings association with a 97% loan-to-value ratio
A first mortgage through a credit union with a 75% loan-to-value ratio
New salesperson John is shopping for a broker. Which of the following should be of the least interest to him in his search?
There are several agents who have been with the firm for a long time.
The firm has an extensive library of real estate resources for agent use.
The firm offers a 100% commission plan.
The broker encourages and supports training.
There are several agents who have been with the firm for a long time.
Broker Alice has a listing agreement with Jack. If Broker Tom procures a buyer for Jack, Tom will get the commission and Alice will not. What kind of listing agreement does Alice have with Jack?
Exclusive agency
Net
Exclusive-authorization-and-right-to-sell
Open
OPEN
Seller Tom has an agreement with Broker Bill, Broker Jim and Broker Joe. Whoever brings the buyer will get the commission. What kind of agreement is this?
Exclusive agency
Net listing
Open listing
Exclusive-authorization-and-right-to-sell agreement
OPEN LISTING
The Housing Financial Discrimination Act is also known as
The Rumford Act
The Holden Act
Title VIII
The Unruh Act
The Rumford Act
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