Help
Options
Didn't know it?
click below
click below
Knew it?
click below
click below
Don't Know
Remaining cards (0)
Know
retry
shuffle
restart
0:00
Embed Code - If you would like this activity on your web page, copy the script below and paste it into your web page.
Normal Size Small Size show me how
Normal Size Small Size show me how
REAL ESTATE
NATIONAL PRACTICE EXAM 2
| Question | Answer |
|---|---|
| A contract that may be rescinded by one party due to duress, fraud, misrepresentation, or because one party is a minor, is also known as | a voidable contract. |
| A broker and sales associate split commissions on a 60/40 basis. If the broker's share of the commission was $3,500 and the sale price was $83,333, what was the commission rate? | 7% |
| Which of the following is a voluntary, specific lien? | Mortgage lien |
| A judgment lien filed in a county usually covers | the debtor’s real and personal property located in that county. |
| A house for sale was advertised, ''Fine executive home in an exclusive neighborhood, suitable for an older couple; near St. Mary's Church.'' All of the following are true EXCEPT | this is descriptive of the property for sale and a good ad. |
| If the amount realized at a sheriff's sale as part of a mortgage foreclosure is more than the amount of the indebtedness and expenses, then the excess belongs to | the mortgagor. |
| Economic, environmental, and external obsolescence refer to | factors outside of the property lines that affect the property’s value. |
| A homeowner recently fenced his property. By mistake, the fence extends one foot over his own lot line onto a neighbor's property. The fence has created | an encroachment |
| When is a certificate of occupancy issued? | After a newly constructed building has been inspected and found satisfactory by the municipal inspector |
| A real estate broker hired by an owner to sell a parcel of real estate must comply with | all lawful instructions of the owner |
| When the owners sold their property, they paid a 6% commission. Their check after the commission was paid was $470,000. What was the selling price of the property? | The answer is $500,000. 100% – 6% = 94% Seller's percent $470,000 ÷ 94% (.94) = $500,000 |
| A minor entered into a contract with a buyer to sell the house she had inherited. This contract is MOST likely | voidable by the minor. |
| The historical records of all owners and encumbrances of a specific parcel of real estate is known as | the chain of title. |
| General real estate property taxes are also known as | ad valorem taxes |
| A buyer signed a listing contract and agreed to pay the buyer's brokerage firm when the buyer purchased any property. The buyer signed | an exclusive buyer agency. |
| A woman has a one-year leasehold interest in a multi-family residence. The interest automatically renews at the end of each year. Her interest is referred to as | a tenancy from period to period. |
| A homeowner constructs an 8-BR brick house w/ a tennis court, a greenhouse, and an indoor pool in a neighborhood of modest two-bedroom and three-bedroom frame houses on narrow lots. The value of this house is MOST likely to be affected by what principle? | Regression |
| A homeowner 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 |
| A buyer and a seller sign a contract for the sale of real property. A few days later, they decide to change several terms of the contract while retaining the basic intent to buy and sell. Process by which the new contract replaces the old one is called | novation |
| A tenant pays rent of $15.50 per square foot annually for her office, which measures 25' × 50'. If the leasing agent is paid 7% of her rent collected, how much is she paid? | The answer is $1,356. Step 1: determine the annual rent, 25' × 50' = 1,250 sq. ft.; 1,250 × $15.50 = $19,375 Annual rent. Step 2: determine the fee, $19,375 × 7% (.07) = $1,356.25. |
| During a job interview, a principal broker tells a salesperson that she will work for the brokerage firm as an independent contractor. As an independent contractor, what can the salesperson expect from her work with the broker? | At least 90% of her income will be based on sales production. |
| A property owner wants to give his property to his sister. The BEST way to transfer title to her would be | to execute and deliver a deed to the sister. |
| The listing or asking price of a property in the marketplace is its | intrinsic value |
| A couple accompanies a property inspector during an inspection of a house on which they have a contract. The inspector points to a six-inch crack at the corner of a dining room window. The crack is an example of | a patent defect |
| Mineral deposits that may be evidence of basement flooding and a crack in a foundation wall can both be considered | red flags that warrant further investigation |
| An executed contract means | all parties have fully performed their duties. |
| The typical relationship between a listing broker and a seller represents what type of agency? | special |
| A broker may act as a dual agent and represent both the seller and the buyer in the same transaction if | both the seller and the buyer give their informed consent, usually in writing. |
| Who is ultimately responsible for a salesperson's mistakes in writing a sales contract? | The salesperson’s principal broker. |
| What capitalization rate is indicated by a property producing $10,000 annual net operating income (NOI) for which an investor paid $105,263? | $10,000 (annual NOI) ÷ $105,263 (purchase price) = 9.5% (.095) the capitalization rate |
| A contract entered into while someone is under duress is considered to be | voidable |
| All of the following actions are illegal under federal and state fair housing laws EXCEPT | refusing to show certain residential property to people who are not financially qualified to purchase it. |
| Who should fill in the blanks of the seller property disclosure form? | seller |
| A homeowner has owned house > 50 years. But because she lives on a fixed income, she does not have the $ to make the needed repairs. She has a considerable amt of equity in the house. What loan would BEST provide her the funds to make repairs? | Reverse mortgage |
| Consideration could be all of the following EXCEPT | earnest money |
| When estimating the value of property using the cost approach, all of the following are considered by an appraiser EXCEPT | loss of value due to uncollected delinquent rent. |
| The type of loan that will MOST likely have the lowest loan-to-value (LTV) ratio is | a conventional loan. |
| The type of easement granting a right-of-way for a utility company's power lines is | an easement in gross. |
| A financing instrument that establishes a third party to hold title on behalf of the lender is | a deed of trust |
| The N½ of the SW¼ of a section contains how many acres? | 80 acres |
| The primary purpose of errors and omissions (E&O) insurance is to | protect against catastrophic lawsuits. |
| A listing broker discovers a latent defect in the home, which the seller has not disclosed on the seller's property disclosure form. The broker | must disclose the defect to the buyer or the buyer’s representative. |
| 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. |
| A lease agreement is signed by a lessee who is 16 years of age. Which of the following is TRUE? | The lease agreement is voidable by the minor. |
| It is necessary to calculate a dollar value for depreciation when using which of the following? | The cost approach to value |
| The following legal description contains how many acres: the S½ of the SE¼ of the NW¼ of the NE¼ of Section 7? | 5 acres |
| Radon poses the greatest potential health risk to humans when it is | trapped and concentrated in inadequately ventilated areas. |
| The clause in a mortgage instrument that would prevent the assumption of the mortgage by a new purchaser is | a due-on-sale clause |
| The borrower discovers that the loan is not assumable. What clause did the borrower find? | Due-on-sale |
| Change, contribution, and substitution are some of the basic principles that affect what aspect of real estate? | value |
| A developer experiences success and good profits in a recent real estate project. What principle of value indicates that her experience will attract others to engage in similar projects in the same area? | Competition |
| The process by which the government can acquire ownership of private land for public use is | condemnation. |
| Which of the following does NOT create an agency relationship? | A payment of money or commissions |
| A township contains | 36 sections |
| Which of the following gives the BEST evidence of the buyer's intention to carry out the terms of the real estate purchase contract? | The earnest money deposit |
| Asbestos, sick building syndrome, and lead-based paint are all examples of issues beyond the scope of | environmental concerns that a property manager may have to address. |
| What is the estimated replacement cost of a 65' x 30' building at an estimated cost of $128.50 per square foot? | The answer is $250,575. 65' × 30' = 1,950 sq. ft. × $128.50 per sq. ft. = $250,575. Square footage is found by multiplying the length and width of the building: 65' × 30'. |
| She does not remove the cat even after the landlord gives her a written reminder, insists that she remove the pet. Tenant refuses, saying cat is small, cause no damage. landlord decides to remove tenant due to the breach.. The legal process is known as | actual eviction |
| All of the following are typically found in a listing contract EXCEPT | the date the broker will schedule an open house |
| Lot A measured 200' x 300' and sold for $30,000 per acre. Lot B, which is located down the street, measures 150' x 200'. If Lot B sells for the same price per acre as Lot A, what is the price of Lot B? | Lot B is 150' x 200' = 30,000 sq. ft. As 30,000 is less than the 43,560 square feet in an acre, divide 30,000 by 43,560: 30,000 ÷ 43,560 = .6887 acres. The price is $30,000 × .6887 = $20,661. |
| Wear and tear on a property is best defined as | physical deterioration |
| The ability of a community to attract income and business is known as the community's | economic base. |
| If an owner takes his property off the market for a definite period of time in exchange for some consideration, but he grants an individual the right to purchase the property within that period for a stated price, the contract is called | an option |
| The final decision on a property's listing price should be made by | the seller |
| Under its police powers, a municipality may regulate all of the following about housing in a development EXCEPT | restrictive covenants |
| A property owner deeds a parcel of his property to a town "for recreational purposes only." The deed conveys to the town | a fee simple defeasible estate. |
| Each of two brokerage companies claimed full commission for the sale of a property that was listed by both of the firms under an open listing agreement. The broker who is entitled to the commission is the one who | was the procuring cause of the sale. |
| All of the following are true about errors and omissions (E&O) insurance EXCEPT | E&O policies vary little from provider to provider. |
| The buyer and seller have entered into a binding contract for sale. However, before closing, the law changes and the buyer's intended use of the property becomes illegal. Which is TRUE? | The contract is void due to impossibility of performance. |
| A listing broker notices that a seller's property disclosure form is not signed and that some of the boxes indicating structural damage have not been checked. What should the agent do? | Question the sellers and have them sign and truthfully complete the form |
| A tenant leases a heated apartment, but the landlord fails to provide heat because of a defective central heating plant. The tenant vacates the premises and refuses to pay any rent. The tenant's action is an example of | constructive eviction. |
| An automatic renewal clause would MOST likely be found in which of the following leases? | Periodic tenancy |
| A listing contract will usually include all of the following information EXCEPT | the multiple listing service (MLS) standard commission rate. |
| A bilateral contract is one in which | the promise of one party is given in exchange for the promise of the other party. |
| A map illustrating the sizes and locations of streets and lots in a subdivision is called | a subdivision plat. |
| Abandoned factories, former dry cleaning properties, and vacant gas stations that may contain environmental hazards are classified as | brownfields. |
| Which of the following is NOT considered by an appraiser using the income approach to value? | Depreciation |
| Lead would likely to be found in all of the following EXCEPT | insulation. |
| A listing agent does not disclose to his client that he has agreed to manage a duplex for the buyer once it has been sold. The agent's action | violates his duty of disclosing material facts to the seller. |
| A building is valued at $215,000 and contains four apartments that rent for $470 each per month. The owner estimates that the net operating income (NOI) is 65% of the gross rental receipts. What is the capitalization rate? | First, calculate the NOI: $470 (unit rent for one month) × 4 (number of units) = $1,880 × 12 (months in a year) = $22,560 × 65% (.65) (owner's estimate of NOI) = $14,664 (the NOI). $14,664 ÷ $215,000 (building's value) = 6.8% (.068) |
Created by:
vtlove116
Popular Real Estate sets