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NH RE Exam 4
| Question | Answer |
|---|---|
| An appraisal process that is a method of establishing the value of income type properties is called: | Capitalization is an appraisal process that establishes the value of income type properties by converting net income into market value. |
| Another term for PITI is: | PITI stands for Principle, Interest, Taxes, and Insurance. |
| A loan is also simply known as: | A sum of borrowed money usually repaid with interest In the most basic of terms, a loan is a sum of borrowed money usually repaid with interest. |
| A tenant is excused from paying rent in the event of fire or casualty damage and the landlord receives uninterrupted income while the premises is unusable by means of: | Rent-loss insurance Rent-loss insurance covers a landlord for lost rent in the event of casualty damage while the premises is unusable. Also the tenant is excused from rent for this period. |
| A fiduciary who holds or controls property for the benefit of another is called a(n): | Trustee A trustee is a person that holds or controls property for the benefit of another. |
| Individual lots that are created from a larger tract and that are offered for sale or lease best describes a: | Subdivision Individual lots that are created from a larger tract and that are offered for sale or lease best describes a subdivision. |
| If a property is leveraged at 50%, this means that the debt on the property is which percentage of its value? | 50% When a property is 50% leveraged, it means that there is a debt on the property 50% of its value. The owner’s equity would be 50% in this case. |
| In most states, the seller of residential property consisting of 1-4 dwelling units is responsible for filling out: | A property condition disclosure statement A property condition disclosure statement is required to be filled out by the seller of residential property consisting of 1-4 dwelling units in most states. |
| A delinquent mortgage payment occurs when: | The payment is not paid when due A mortgage payment becomes delinquent when the payment is not paid when due. |
| The possessor of land in which an easement crosses cannot: | Terminate the easement at will An easement cannot be terminated at the will of the dominant property owner. Something of this nature must be determined by the courts. |
| If a person wishes to obtain a chattel mortgage, they would need to put up: | Personal property as collateral A chattel mortgage is a mortgage that is secured by personal property. |
| The surface of the earth and the material beneath the surface of the earth is part of the: | Real property Parts of real property include the surface of the earth and the material beneath the surface of the earth. |
| An ironclad merger clause is a contract provision stating that: | No prior agreement or contemporaneous oral agreement will have any force or effect A contract provision stating that “No prior agreement or contemporaneous oral agreement will have any force or effect” is called an ironclad merger clause. |
| The process of paying off one loan with the proceeds from a new loan using the same property as security is known as a: | Refinance transaction In a refinance transaction, the borrower pays off one loan with the proceeds from a new loan using the same property as the security. |
| If Franklin, a real estate agent, intentionally speaks very highly and enthusiastically about a property he is trying to sell to a client in order to secure the deal, this type of behavior would be: Correct | Puffing The term “puffing” can be used to describe “sales talk” that is used to secure a deal. As long as there is no misrepresentation, it is considered a legal practice. |
| The appraised value of a property is intended to estimate the: | Market value of a property The appraised value of a property is the value placed on a property by an appraiser and is usually intended to estimate the market value of the property. |
| If a loan that has a loan to value ratio of more than 80%, this is required: | Mortgage insurance Mortgage insurance is required on loans that have a loan to value ratio of more than 80%. |
| Airways above a property are: | Public domain Airways above property are now considered to be public domain. Use is granted to an owner to a “reasonable height”. |
| When two or more persons agree to act and the agreed upon action has the effect of restraining trade, this is called: | An anti-trust conspiracy An anti-trust conspiracy occurs when two or more people agree to act and the agreed upon action has the effect of restraining trade. |
| Functional obsolescence is best exemplified by: | Dated equipment Dated equipment is an example of functional obsolescence. |
| The type of listing that is the most risky and open to fraudulent activity is called: | Net Net listings are when the agent keeps the sales price above a certain amount and can subject the broker and agent to have their licenses suspended or revoked. |
| In New Hampshire, in addition to censure and revocation of licenses, the New Hampshire Real Estate Commission can fine a licensee up to x for a single violation. | $2,000 The New Hampshire Real Estate Commission can fine a licensee a maximum of $2000 for a single violation. |
| Under which law is it not permissible for a broker to only sell a property under the condition that the broker obtains the listing for future sales? | Sherman Act Under the Sherman Antitrust Act, it is prohibited for a broker to sell a property under the arrangement that the broker is to obtain the listing for future sales. |
| When a real estate agent is viewing the report on the title of a property from the public records, or an abstract of the title, the agent is viewing: | An examination of title An examination of title is the report on the title of a property from the public records or an abstract of the title. |
| A type of foreclosure proceeding used in some states that is handled as a civil lawsuit and conducted entirely under the auspices of a court is called a: | Judicial foreclosure A judicial foreclosure is a type of proceeding in some states that handles foreclosure as a civil lawsuit and is handled entirely by the courts. |
| Bob bought a parcel of raw land in 1985 and subdivided it into four separate lots. Five years later, he sold each lot for $50,000. The adjusted basis for each lot was $25,000. Bob's long-term capital gain on these transactions is: | $100,000. $25,000 x 4 lots = $100,000 adjusted basis. $50,000 x 4 lots = $200,000 total selling price. $200,000 - $100,000 = $100,000 capital gains. |
| If one party cannot perform their part of the agreed terms of a contract, the victim party can claim the other party: | Defaulted If a party cannot perform their part of the agreed terms of a contract, the other party can claim the other party defaulted. |
| If an advertisement is offering a secured loan, the ad must include: | How and to what extent the loan is secured Disclosure of how and to what extent a loan is secured must be included in any advertisements offering secured loans. |
| If a church, school, or hospital wishes to relocate to an area zoned exclusively for residential use, they could do so by: | Conditional use Conditional use is reserved for exceptions in the zoning laws that allow for special uses such as for churches, schools, and hospitals. |
| Method of attachment, adaptability of the attached item, relationship of the parties, intent of the person attaching the item, and agreement between parties are: | The standard five tests used by courts for a fixture |
| The collection of mortgage payments from borrowers and related responsibilities of a loan servicer is known as: | Servicing This type of work is known as servicing. These actions are responsibilities of a loan servicer. |
| One of the differences between an exclusive agency listing and an exclusive right to sell listing is: | Less security with an exclusive agency listing The seller may be able to procure a buyer without paying any commission to the agent with an exclusive agency listing. |
| When only one party gives a promise in a contract while the other does not, this type of contract is known as a: | Unilateral contract A unilateral contract is a contract in which only one party makes a promise. |
| When a real estate developer obtains a loan for building a new housing tract and the lender gives part of the funds to the developer and agrees to release the rest of the funds as each home is built, this is called which type of financing: | Obligatory In this type of situation, this financing is called obligatory financing or also called fixed disbursement schedule. |
| If a property is being evaluated for tax purposes in regards to its value, this would be called: | An assessment When a property has a value placed on it for purposes of taxation, this is called an assessment. |
| If Janice owns and occupies one side of a two family house, and she wants to advertise the other side of the house as a non-smoking rental, can this be legally done without discriminating? | Yes. The right to smoke is not protected by law. There is no law that protects a person’s right to smoke. Advertising a rental as non-smoking is not discriminatory and is therefore, legal. |
| An estate can be best described as: | The sum total of all the real and personal property owned by an individual at the time of death |
| What is the formula for determining the value of an investment property? | Net operating income divided by capitalization rate |
| Assets quickly converted to cash are considered: | Liquid |
| If Greg and Tom agree orally that Tom will clean the windows on Greg’s house twice a month, Greg and Tom have a: | Valid Contract |
| A federal law requiring lenders to fully disclose in writing the terms and conditions of a mortgage, including the annual percentage rate and other charges, is called: | Truth-In-Lending The federal law that requires lenders to fully disclose the terms and conditions of a mortgage including the annual percentage rate and other charges, in writing, is called the Truth-In-Lending law. |
| One of the jobs of a property manager is: | Maintaining the property while managing finances One of the major jobs of a property manager is to maintain the property while managing the financial side of the operation for the property owner. |
| One of the indexes used to determine interest rate changes for certain adjustable-rate mortgages is called: | COFI The cost of funds index (COFI) is one of the indexes used to determine interest rate changes for certain adjustable-rate mortgages. |
| A “no cash-out refinance” is also sometimes referred to as a: | Rate and term refinance can also sometimes be referred to as a no cash-out refinance. It recalculates the new balance to cover the balance due on the current loan as well as covering any costs associated with obtaining the new mortgage. |
| If a lender is referring to “a point”, the lender is talking about: | 1% of the mortgaged amount |
| Vendee is also known as: | Buyer |
| The term “mortgagee” refers to the: | LenderLocation |
| B offers to buy S home for $349k. S says that she needs at least $375k. B finds another property and replies that he is no longer interested. S decides to accept the offer for $349k. B now offers $325k and does not want to pay more. B and S have: | Bruce and Selina have no contract. A counter offer acts as a rejection of the prior offer. In addition, there is no “meeting of the minds” and have not agreed on a price. |
| An agent that obviously and falsely represents is known as: | Fraudulent Misrepresentation When an agents representation is an obvious falsehood, this is known as ‘fraudulent misrepresentation’. |
| Government surveys use sections, townships, and ranges to describe what about land? | Location Out of all the answer choices given, location is the most correct. The government surveys use sections, townships, and ranges to determine location of land. |
Created by:
vele
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