NRL: Simulated Exam 3
Seller of a property wants to net $92,500 after paying $1,200 in points; $500 in closing costs and 7% commission. What must the property sell for?
$101290
A salesperson earns $75,000 per year. If he receives 75% of the 7% commissions paid to his firm on his sales, what is his monthly dollar volume of sales?
$119,047 1) 75,000 ? 75% = $100,000 (annual commission included broker portion) 2) 100,000 ? 7% = $1,428,571 (annual sales volume) 3) 1,428,571 ? 12 months = $119,047 (monthly sales volume) His monthly dollar volume of sales was $119,047.
What should a property sell for if the seller wants to net $90,000 and the following conditions apply? Loan payoff of $40,000; closing costs of 3% and real estate commission of 6%?
$142857
The appropriate fee that must accompany the notification of any change of name, address, or association is:
$20
A salesperson sold 2.5 sections of land for $500 per acre. The salesperson's commission was 50% of the 5% commission. How much did the salesperson receive?
$20000 The salesperson received $20,000. Calculation below. 640 acres (1 sq mile) X 2.5 (sections) = 1600 acres 1600 X $500 = $800,000 2.5% (50% of 5%) X $800,000 = $20,000
If the loan value is 80%, and the property was appraised at $86,500.00 and sold for $88,000.00, how much would the purchaser be permitted to borrow?
$69,200.00 The loan value is based upon the appraised value, not the sale price. The appraised value is $86,500.00; 80% of that amount is $69,200.00. This would be the maximum the purchaser would be permitted to borrow.
What is the depth if a lot is 90 feet wide and contains 1200 square yards?
120 feet
An apartment building has 40 units and an 8% vacancy rate. Units rent for $300 per month and annual expenses are $4,000 repairs; $2,000 legal; $3,000 taxes; $3,600 utilities & 12% of adjusted income for management fee. The investor paid $550,000 for the property what was his rate of return?
18.9 percent
An applicant may cancel and reschedule an examination appointment without forfeiting the fee if the cancellation notice is received by PSI in which timeframe?
2 days before the scheduled examination date
Mr. Scott paid cash for a $98,500 lot. He later sold it for $126,000. What % profit did he make?
28% Mr. Scott made a 28% profit. To calculate the profit amount take the difference between the purchase price and the sold price ($126,000 - $98,500 = $27,500) and then divide by the original purchase price ($98,500). >> $27,500 / $98,500 = .2791 (27.91 or 28% rounded)
A purchaser has the right to cancel the purchase of a home or unit in a common-interest community for what period of time?
5 days after receiving the public offering statement The purchaser has a 5-day period in which to cancel the purchase agreement after receiving the public offering statement.
All of the following are exemptions from the provisions of the sale of subdivided land upon notification to the Division by the person electing to be exempt, except which one?
A lot, parcel, or unit being offered in any subdivision that is more than 60 acres in size
A real estate broker who holds a permit to engage in property management must first obtain which of the following to act as a property manager?
A property management agreement signed by the client and the broker
All of the following are examples of "advertisement" EXCEPT?
A solicited e-mail including information about a property and the agent "Advertisement" includes, without limitation, any unsolicited printed material and any broadcast made by radio, television, or electronic means, including, without limitation, by unsolicited electronic mail and the Internet, billboards and signs; and business cards, stationery, forms, and other documents used in a real estate transaction. A solicited e-mail to a client including information about a property and the agent is not an advertisement.
Roberta wishes to build her garage 2 feet from her side lot line. City code calls for all side setbacks to be at least 5 feet. She will need to get what to be able to legally proceed and be assured that future owners will not have a problem?
A variance
A disabled tenant was denied permission to install a handlebar in the shower. What law has the landlord violated?
ADA
Which of the following is not a fiduciary duty?
Achievement The fiduciary duties are, obedience, loyalty, disclosure, confidentiality, accountability, and reasonable skill & care (remember: A.C.O.L.D).
The completion of the property disclosure form does not require a seller to disclose a defect in residential property of which the seller is not aware. A completed disclosure form does not constitute:
An express or implied warranty The completed disclosure form does not constitute an express or implied warranty. The completion of the disclosure form does constitute a completion of the requirement to provide disclosure to the purchaser and it is an evaluation of the condition of the property.
The failure of a community manager to give written notice to the Division of a change in the manager's association would result in which of the following?
An involuntary inactivation of the certificate Failure to give notice to the Division of any change of name, address, or association and pay the appropriate fee required constitutes cause for the involuntary inactivation of the certificate. There would not be a hearing before the Commission. There is no license, only a certificate, so a suspension of license would not occur. The voluntary submission of a certificate would be accomplished by the applicant and not required by the Division.
Which of the following activities will not occur in the secondary market?
An origination fee Loan origination (and fees) occur in the primary market where loans are initiated.
The funds for a loan secured by a trust deed are supplied by the:
Beneficiary The beneficiary is the lender who is providing the funds.
A broker takes a listing and one of his non-management level licensees represents a buyer that makes an offer acceptable to the seller. Which agent is the dual agent?
Broker
A salesperson has a direct fiduciary duty to the:
Broker The salesperson always has a duty to his/her broker. The broker always has a duty to the client.
What would be considered evidence of the agency relationship between broker and buyer?
Buyer broker contract
A buyer is purchasing a home located within a homeowner's association. The home has a violation that is not known by the association and is not disclosed to the buyer. What is true regarding the violation?
Buyer may be required to correct the violation
When selling an individual condominium unit which of the following would be appurtenant to the unit?
Cabinets in the unit In a condominium, built-in cabinets are appurtenant.
When a broker received an unexpected bill, he deposited a client's earnest money check into his personal account to cover the expense. This best describes:
Commingling Most states consider this behavior a violation of license law.
A licensed salesperson or broker-salesperson must provide the necessary paperwork to the salesperson's broker within 5 days of which of the following?
Completion of any agreement that has been executed by all parties The salesperson or broker-salesperson must provide any paperwork to the real estate broker with whom the salesperson is associated within 5 calendar days after that paperwork is executed by all the parties.
What type of land use doesn't comply with the zoning restriction for where it is located, but is permitted because it benefits the public?
Conditional use Conditional uses (hospitals, schools etc) usually do not comply with zoning limitations.
Unless agreed to in writing, the licensee owes no duty to a client regarding which of the following?
Conduct an independent inspection of the financial condition of a party to the transaction The duties of the licensee acting as an agent in a real estate transaction do include items a, b, and d. The licensee owes no duty to conduct an independent inspection of the financial condition of a party to the transaction UNLESS otherwise agreed to in writing.
Which fiduciary duty goes beyond the relationship?
Confidentiality
When the appraiser looks at the home Sandy has just purchased, he notices it has a fireplace and the comparable homes do not. He makes a $3,000 upward adjustment on his sales comparison approach worksheet. The $3,000 adjustment is based on what appraisal principle?
Contribution This is the amount the fireplace "contributes" to the value. It is not necessarily the cost to install the individual item.
A buyer of a residential unit receives stock as a form of ownership. This is best described as:
Cooperative Cooperative property is owned by the corporation and residents are shareholders who purchase stock.
What would not be a legal principle when applying legal tests to fixtures?
Cost of the item
A customer came to Dave's open house and fell in love with the property. When the customer expresses to Dave they may not have enough cash to close, Dave suggests the customer ask the seller to pay closing costs. The buyers ask for $3,000 in closing costs from the seller. Dave suggests to the seller they take the offer, because it is common for a buyer to ask the seller for concessions. Which is the best description of the situation?
Dave should not offer unauthorized terms of sale
Which of the following would be an encumbrance and a lien?
Deed of trust
Which of the following does not derive from a city's police power?
Developer's restrictive covenants All are government restrictions on land use except C, which is enacted by a private citizen.
A group of local real estate brokers are having their annual meeting. What topic should be avoided in their conversation?
Discussion of their personal commission schedules Competitors should never discuss their office commission schedules outside the office. This could lead to anti-trust allegations.
The real estate broker must supervise the activities of the licensees associated with the broker and that includes all of the following EXCEPT:
Documents pertaining to a person outside of a real estate transaction The real estate broker must supervise All of the answers including the review of documents, but only those that may have a material effect on the rights or obligations of a party to a real estate transaction.
All of the following are examples of real property except:
Drapes Drapes are usually not considered real property. In some instances (i.e. drapes custom made to fit an unusual window), they can be considered real property.
What power does the government exercise when it takes private property for public use?
Eminent domain Condemnation, or appropriation, describe the act of taking the land. Eminent domain is the power that makes it possible.
An agency agreement that allows the sellers to procure the buyer themselves best describes a/an:
Exclusive agency
Federal Emergency Management Agency (FEMA) is responsible for:
Flood area maps
The subject property has five bedrooms but only one bathroom. What could this situation be causing?
Functional obsolescence When something inherent in the subject property causes the loss of value, the property suffers from functional obsolescence.
An agent's duties to all customers include:
Good faith and fair dealing
"Effective gross income" best describes:
Gross income minus a figure for vacancy and collection losses Effective gross income is generated by a property, plus miscellaneous income, minus a figure for vacancy and collection losses.
A broker has a fiduciary duty to:
His/her client
When real estate is depreciated for tax purposes it must be:
Improved property Only improvement on the property may be depreciated.
"Net income" best describes:
Income after expenses Expenses such a trash removal, repairs, and maintenance subtracted from gross income equals net income.
Megan's Law would apply to which of the following?
Information regarding child molesters
Which of the following is a general lien?
Judgment lien A judgment lien is a lien, acquired in a court of law, which attaches to all the defendant's property (both real and personal). A mortgage is a specific lien against real property only. The property taxes are a lien against the property being accessed, and a mechanic's lien is specific to a certain property. An easement is not a lien, but it is an encumbrance on the use of property. The phrase to remember: "While all liens are encumbrances, not all encumbrances are liens."
All of the following are paid by the seller EXCEPT:
Lender's title policy The buyer pays for the lender's title policy.
The three most important aspects of a house are:
Location, location, location Where the property is located alone can contribute value to the property regardless of size, style, or function.
A licensed real estate broker, real estate broker-salesperson, or real estate salesperson is asked to act as a business broker for a client. The licensee must do which of the following?
Make application with the Real Estate Division for a permit to engage in business as a business broker A licensed real estate broker, broker-salesperson, or salesperson must apply for a permit to engage in business as a business broker. If the licensee does not hold a permit, the real estate broker for that office may appoint a person with the qualifications required and a permit to act as a designated business broker for the office to supervise the activities of a business broker conducted at the office.
Constructive fraud is also known as:
Negligent misrepresentation Constructive fraud is an unintentional concealment or omission of a material fact, also known as negligent misrepresentation.
The amount of earnest money to be deposited for a purchase is:
Negotiable between the parties There is no state law, Canon of Ethics rule or Board of Realtors rule which states how much earnest money, if any, is required. Earnest money is totally negotiable between the buyer and seller.
Mary makes an offer through a listing agent to buy Beth's house. The listing agent takes the offer to Beth and explains it to Beth. Beth accepts the offer. Is there a valid contract?
No - there has been no communication or deliver of the accepted offer To be a valid enforceable contract, there must be an offer, acceptance and delivery of the acceptance. Neither the communication of the offer to Beth, nor the acceptance by Beth is delivery of the acceptance to Mary.
When showing a downtown condominium, a licensee brags, "This unit probably has the best view of Lake Michigan in the whole city!" Would this statement have legal consequences?
No - this is "puffing" and is the agent's opinion Bragging about a property is allowable, but an agent must use care. Saying "the basement never leaks," for example, might be a cause for legal action if the basement does leak.
Title insurance for the lender would cover all of the following EXCEPT:
No junior liens will appear on title Title insurance for the lender would cover all of the following EXCEPT "no junior liens will appear on title."
A seller has agreed in a counteroffer to pay the buyer's closing costs. The salesperson for the buyer has prepared and had signed an addendum to the purchase agreement stating this agreement. The buyer's lender has received the original purchase agreement from the buyer, but is not aware of the addendum. In a phone conversation with the lender, the licensee does not mention the addendum. The licensee should:
Notify the lender of the change in terms and provide a copy of the addendum A licensee may not represent to any lender, guaranteeing agency, or any other interested party, verbally or through the preparation of false documents, an amount in excess of the actual sale price of the real estate or terms differing from those actually agreed upon by all parties. They must provide the lender with the addendum even if it is not requested.
The permit to engage in property management initially issued by the Division is effective:
On the latter of the date the application is submitted or the date the fee is paid The permit is effective on the date the application for the permit is submitted to the Division or the date on which the fee for the permit is paid, whichever occurs later.
What is a holder in due course?
One who acquires a negotiable instrument in good faith and for consideration A secondary market investor will only buy negotiable instruments as a holder in due course.
What statement in an advertisement requires a full explanation?
Only $5,000 down
Wetlands would come under:
Police Power
Building permits would be issued under the government's right of:
Police power
Husband & wife own community property and make a will. How is the property distributed upon the death of one party?
Property passes according to the will
A salesperson terminates association with a real estate broker. The broker must do which of the following?
Provide a written statement surrounding the termination of the association along with the salesperson's license by delivery or certified mail to the Division of Real Estate. The broker is not charged a fine if the association is terminateThe broker must deliver or mail by certified mail to the Division the real estate salesperson's license within 10 days after the termination occurs (along with a written statement surrounding the termination of the association). The broker must also address a communication to the last know residence address of the salesperson, advising that the salesperson' license has been delivered or mailed to the Division (not by phone.) A copy of the communication must accompany the license when delivered or mailed to the Division.
A property is new construction and the purchaser has signed a sales agreement six months after the completion of the residential property. The seller must do which of the following?
Provide the purchaser with notice of any soil report prepared for the residential property An initial purchaser that signs a sales agreement that was not occupied by the purchaser for more than 120 days after substantial completion of construction must be provided with notice of any soil report prepared for the residential property or for the subdivision in which the residential property is located. There is no requirement for a completed property disclosure for the first sale of the property and the seller need not disclose previous offers to the purchaser.
Which deed is most commonly used to clear up clouds on a title?
Quit claim The best deed to convey any interest one has in real property would be a deed with no warranty.
An administrative fine has been charge to a licensee by the Division of Real Estate and the licensee has failed to pay the fine. The Division may do which of the following?
Refuse to renew the license or suspend or revoke the license In addition to any other remedy or penalty, the Commission or the Division may refuse to issue a license to a person who has failed to pay money, which the person owed to the Commission or the Division. It may also refuse to renew, or suspend or revoke, the license of a person who has failed to pay money, which the person owes to the Commission or the Division.
In a residential loan transaction, what requires the lender to show the real interest rate?
Reg. Z
What law requires the lender to show the APR?
Reg. Z
A disclosure by a licensee of a property for lease that is owned by a member of the licensee's family may be accomplished by using a reference to him or herself as any of the following EXCEPT:
Representative
Bobby agrees to lease Rich's house for nine months. When Bobby asks to see the contract, Rich states, "I use handshake deals for short-term leases." What statement is true?
Rich is allowed to do this. Under Nevada law, written instruments are required for transfers of title or interest by lease unless the lease is for one year or less.
The Smiths purchase a cooperative on the Gold Coast. What will they receive at closing?
Shares of stock and a proprietary lease A cooperative is not real estate, but the purchase of shares of stock in a corporation. With the stock comes a proprietary lease, or the right to occupy a specific unit.
A valid warranty deed must contain all of the following elements, except:
Signed by grantee A valid warranty deed does not require grantee's signature.
Two non-management level licensees (both working for the same broker) are representing opposing sides of a transaction. This best describes:
Split agency
A "sampler program" allows a prospective purchaser of a time share to buy an increment of time or occupancy of a limited duration in a time share plan for the purpose of determining whether to purchase a time share in the time share plan. Which of the following must be included in the contract used in the sale of a sample program?
The Real Estate Division of the Department of Business and Industry does not regulate or evaluate the sale of this product. No representations to the contrary may be made. The other three statements are only to be printed clearly and conspicuously above the purchaser's signature line in each contract for sale of a time share. The contract for a sampler program does not require these statements.
The conveyance of a property requires which of the following?
The closing of any escrow opened for the conveyance A "conveyance of property" occurs upon the closure of any escrow opened for the conveyance. If an escrow has not been opened for the conveyance, then when the purchaser of the property receives the deed of conveyance.
A person licensed to perform as a broker for a corporation ceases to be connected with that corporation. Which of the following is a correct statement?
The corporation may designate another person to apply for the broker's license. If a person licensed to perform as a broker for a corporation ceases to be connected with the corporation, the corporation may designate another person who must apply and qualify, as in the instance of the previous licensee.
The real estate broker is responsible for teaching the licensees associated with her which of the following?
The fundamentals of real estate practice
A licensee has been notified of a deficiency involving advertising by the Division and has failed to comply with the request. All of the following are possible EXCEPT:
The licensee may dispute the notice with the Division
An agent has an appointment with a prospective buyer to complete a purchase contract and must leave the office due to an emergency. The agent requests that another agent in the office take care of the client, prepare the offer, and present the offer to the agent representing the seller. The agent agrees to give a portion of the commission to the other agent for assistance in this transaction. The commission may only be paid to the agent in which manner?
The licensee may only pay the agent a commission through the broker under whom the licensee is licensed
A prospective purchaser wishes to give the seller a gift certificate for airline tickets as an earnest money deposit in lieu of cash. The agent representing the prospective purchaser must do which of the following?
The licensee must communicate the fact to the owner before acceptance of the offer The licensee may not accept anything other than cash as earnest money unless that fact is communicated to the owner before acceptance of the offer to purchase and that fact is shown in the receipt for the earnest money.
Marketing a property through the Internet is considered advertising and establishes a relationship as an agent of the client, as long as which of the following occurs?
The licensee obtains the appropriate signature of the client
Who is responsible for submitting an agent's license to the Division on the termination of the employment or association of a sales agent with a project broker?
The project broker
"The subject property" best describes:
The property for which the value is sought The appraiser does not consider properties on the market. The subject is the property for which an opinion of value is sought, also called the base.
A licensee may only advertise with the direct supervision of which of the following?
The real estate brokerage with which the licensee is associated
The purchaser of a property, prior to conveyance of the property, has been informed of a defect in the property by the seller's agent. The purchaser may rescind the agreement to purchase provided all of the following requirements are met except which one?
The rescission is served not later than 5 working days after the date on which the purchaser is informed of the defect The purchaser may rescind the agreement only if it is made in writing, notarized, and served not later than 4 working days (not 5) after the date on which the purchaser is informed of the defect.
A salesperson with a brokerage agreement with the seller has an affiliation with a company that will be furnishing a service to the seller with regard to the real property. Which of the following is a correct statement?
The salesperson must disclose, in writing, the affiliation with the company furnishing the service to the seller The licensee must disclose in writing, not verbally, the salesperson's interest or affiliation with the company or person that furnishes services related to the property. The salesperson must include in the disclosure whether any direct or indirect compensation is expected, or any dividend or profit from any person or company that will perform services related to the property and, if so, the identity of the person or company.
What is assessment value?
The value the property taxes are based on
The purchaser of residential property may waive the requirement for a property disclosure statement. The waiver is effective only under which of the following circumstances?
The waiver is in a written document, signed by the purchaser and notarized The purchaser of residential property may waive the requirement of a written disclosure by the seller as long as the waiver is made in a written document that is signed by the purchaser and notarized.
Ed makes an offer to buy William's house for $45,000. William counters that he wishes to receive $47,000 for the house. Ed rejects William's counteroffer. William later says he will accept Ed's original offer of $45,000. Which of the following statements is true?
There is no contract between Ed and William There is no contract between Ed and William, as a counteroffer is a rejection of the original offer. Once William rejected Ed's offer and made a counteroffer, he could not resurrect Ed's offer by going back and accepting it. A unilateral contract is one that is enforceable, but only by one party. A bilateral contract is a contract which is enforceable by both parties.
Several agents are preparing competing offers on a property. One purchaser properly executes a full price offer on December 21st and the selling agent delivers the offer to the listing agent whose client properly executes the offer on December 22nd. What will be the effective date of the contract from which each party may determine the number of days for their performance?
There is not yet a contract so an effective date cannot be determined Notification of the acceptance of an offer by one party must be communicated to the other party at which time the contract has an effective date. Prior to communication of the acceptance, the first party waiting to hear if acceptance occurred still may "withdraw" the pending offer.
Who has title on a land contract?
Vendor
An action to rescind a contract of sale brought by the purchaser who purchased a lot by means of a property report, which contained an untrue statement of a material fact or omitted to state a material fact, must be brought within which time period?
Within 1 year after the date of purchase and within 1 year after the date of discovery of the misrepresentation Any action to rescind a contract of sale must be brought within 1 year after the date of purchase or within 1 year after the date of discovery of the misrepresentation giving rise to the action for rescission.
A listing agent tells a buyer customer the seller is desperate for an offer. The buyer asks the agent if the agent could tell him the seller's bottom line so the negotiations will be brief. The agent suggests 10% under list price. The seller accepts the offer. Has there been a violation?
Yes, a breach of duty to the seller has occurred The listing agent is representing the seller and not the buyer. The agent has a duty to disclose all material facts to the client. The buyer was only a customer to the listing agent. The agent should not give advice to a customer that is not in the best interest of the seller client.
Real estate agent Keith calls the owner of an expired listing to try to get a listing appointment. When the seller lists her home with the Keith, she gives him the flyer that features her home. On the flyer the seller notes that the house is on three acres. A buyer makes an offer and a few days before closing finds out from the neighbor that the lot is just over two acres. Is real estate agent Keith responsible?
Yes, he should have verified the information on the flyer
A real estate agent tells a buyer that he will make a profit of 5% on his investment in as little as three months. Has the agent done anything wrong?
Yes, promising future value is a violation
A pre-licensing candidate fails to disclose the fact that as a young adult he was convicted of a crime of moral turpitude. He was issued a license and began to practice real estate. Is there a potential problem?
Yes, the agent has obtained a license by fraud Applications to obtain a license often ask a list of ethical questions. Omitting information can be considered fraud and the state can revoke the license.
Which is NOT a protected class under the Federal Fair Housing Act?
ancestry Under the Civil Rights Act of 1866 (and in some states) ancestry is included in the protected groups. The Federal Fair Housing Act does not designate ancestry as a protected group.
Which hazardous material appears as snowflakes when released into the air?
asbestos Radon is a gas. Lead was used in paint and plumbing materials in houses built prior to 1978. Mold may have toxic spores but they are too small to be seen. Asbestos was commonly used in building materials and, if unsealed, it can appear as snowflakes.
Tim sets a closing date for ten days after the last objection disclosed in the Commitment has been resolved. He
can do this, as long as it is prior to the date specified in the contract. The closing must occur within seven days after objections to matter disclosed in the Commitment or by the survey have been resolved or the date specified in the contract, whichever date is later.
An out-of-state prospect asks an agent to locate a diverse neighborhood for him. The agent should
explain that research of this nature is beyond the agent's scope of authority
A person discriminated against under the Civil Rights Act of 1866 must file a lawsuit in what court?
federal district court The federal district court is the only court with jurisdiction over the Civil Rights Act of 1866.
Lance's seller client discloses there was a fatal shooting at the house in which a woman and her two children were the victims. Lance is licensed in a state that does not require the disclosure of the deaths. While showing the property, a potential buyer claims to be getting a strange vibe. Lance should
get the seller's written permission to disclose the incident Some states require an agent to disclose a death on the property While other states do not require the disclosure. The best course of action is to get the seller's written permission to disclose so that if an agent encounters a buyer who is concerned, the agent can disclose.
Broker Bob was found guilty of "commingling." Which did Bob most likely do?
intermix client funds with personal funds
Under the statute of frauds, written instruments are required for all transfers of title or interest EXCEPT for a transfer by
lease for up to one year. Written instruments are required for mortgage, transfers of title or interest by lease unless the lease is for one year or less.
A buyer's agent is paid a percentage of the gross sale price. When negotiating a contract, the agent should
negotiate the lowest possible price for the client
A seller receives an offer and makes a counteroffer. The seller wants to hold the earnest money. The listing agent should
present the counteroffer to the buyer or buyer's agent There is no law saying the seller cannot hold the earnest money. The parties to the transaction should do whatever the contract says in regard to the earnest money.
The clause in a real estate contract referring to "property condition" does NOT
provide for a buyer to establish procedures for completion of repairs in the event the Seller does not perform repairs. The "property condition" clause specifies a buyer's right to have the property inspected; provides for the seller's disclosure of property condition and lead-based paint and hazards; specifies any limitations on the buyer's acceptance of property condition; establishes procedures for the seller to complete the repairs; and includes notices to the buyer.
A busy salesperson gets a call from an investor client who wants to view some properties that afternoon. The time frame the investor wants is already taken. The salesperson offers a variety of alternate times and dates. If the investor cannot change his schedule, the salesperson should
refer the client to another agent Real estate agents are not allowed to give lockbox codes to a buyer, nor can they leave doors unlocked. An unlicensed assistant cannot show properties--this requires a license to practice real estate. Instead, the salesperson should refer the investor client to another agent.
A licensee is asked by the seller to paraphrase a provision regarding a lease, and then insert it into the base contract. The licensee should
refuse to paraphrase any provision but instead use the appropriate promulgated addendum or lease form, or one that is required and provided by a principal to the contract. The licensee must use the appropriate promulgated addendum or lease form or one that is required by a principal to the contract, and is prohibited from paraphrasing provisions contained in a promulgated form and simply adding them to the base contract.
Homeowners with both a first and second mortgage decide to ask their primary lender to accept a short sale offer on their home. The primary lender allows the short sale. The listing agent should warn the seller of the
second mortgage holders rights While the first mortgage holder could allow the owner to take a short sale, there is no rule saying the seller gets to walk away with all debt forgiven. A short sale typically takes months to negotiate and so the listing agent would not have to warn the client of a quick transaction. The second mortgage holder can turn the debt over to a collection agency. Tax advice should come from an accountant not a real estate agent. Legal advice should always come from an attorney.
After closing on an expensive property, Salesperson Andy brags to his golf buddies that the client was a well known professional golfer. Andy forgot the buyer did not want anyone to know who he was. Which statement is TRUE?
the agent has breached the duty of confidentiality
While walking through a home, a buyer notices a large crack in the wall. The seller does not disclose this item on any property disclosure statement. After the sale is completed, the buyer sues the seller for the necessary repairs of the crack in the wall. Which statement is TRUE?
the buyer has no claim, under the doctrine of caveat emptor Under the doctrine of caveat emptor "let the buyer beware", the buyer must examine goods or property and buy at his own risk. Any patent defect does not need to be disclosed by the seller, as it is readily viewable by the buyer, and the buyer takes the property subject to the defect. A latent defect needs to be disclosed by the seller either directly to the buyer or on the property disclosure form. As this is a patent defect, there is no liability on behalf of the seller.
In a suit brought under the Federal Fair Housing law as amended, punitive damages may be as much as
there is no limit on punitive damages While an individual may be fined $11,000 by HUD for a violation of the Fair Housing Act and $55,000 for a third offense within the past seven years, there is no limit on compensatory or punitive damages awarded by a court of law.
A buyer is accompanied by his real estate agent to see a bank-owned house in the neighborhood. The real estate agent points out what appears to be mildew on the corner of the basement wall. The agent tells the buyer to pass on this one because the mold on the wall is toxic. Three weeks later, the agent shows the buyer one of his own listings. The buyer notices some mildew under the bathroom window. When the buyer asks the agent about the mildew the agent says it's harmless. The agent
was unethical
