Real estate exam (3)
The client may be obligated to compensate the salesperson for financial losses incurred as a result of actions by the clients. A. True B. False
A
"Time is of the essence" means a reasonable time within which a contract (or portion of a contract) must be performed. A. True B. False
B
It is necessary to prove that money damages were suffered in order to rescind a contract. A. True B. False
B
What type of contract is an exclusive right-to-sell listing agreement? A. Unilateral. B. Bilateral. C. Multilateral. D. Lis pendens.
B
Wilma lists her house with broker Fred under an exclusive right-to-sell agreement. Fred later abandons the listing. Which of the following is true in this situation? A. Wilma must maintain the listing with Fred until the expiration date. B. Wilma may terminate the listing. C. Wilma must wait 90 days before she can list the property with another broker. D. Wilma must file a notice of abandonment.
B
A property is listed at $168,000. A full price offer is made without contingencies. Which of the following statements is the most complete correct answer? A. The seller must accept the offer. B. The seller is not obligated to sell the property. C. The seller may refuse to sell, but could be required to pay the broker a commission. D. The seller would be in violation of Fair Housing law.
C
A purchase contract has been agreed to by the buyer and seller of a home. The contract calls for closing to occur in 45 days. Later, the closing is actually scheduled for the 47th day. The contract could be rescinded if the contract included which of the following phrases? A. "Exact times required." B. No special wording is required. C. "Time is of the essence." D. "Time limits are specific."
C
Broker Bob represents both the seller and the buyer as agent in the same transaction. Which of the following statements is correct? A. This arrangement is always illegal. B. This arrangement is never illegal. C. This arrangement is only legal with the informed consent and written permission of both the buyer and the seller. D. This arrangement is legal only in a few states.
C
During the period of time after a real estate contract is ratified, but before title actually passes to the buyer, the status of the contract is: A. Voidable. B. Executed. C. Executory. D. Implied.
C
In agency representation, the employer is called the A. seller. B. agent. C. client. D. broker.
C
Money or trust instruments received, accepted or held pending consummation or termination of a real estate transaction are: A. Commissions. B. Down payments. C. Escrow funds. D. Anticipated profits.
C
Which of the following would cause a contract to be void? A. Fraud. B. Undue influence. C. Illegal purpose. D. Duress.
C
A lease provision that prohibits using certain premises for a drugstore is called a A. protective covenant. B. use covenant. C. restrictive covenant. D. condemnation covenant.
B
A property management contract is between the property manager and: A. His or her employees. B. The property owner. C. The tenants. D. The broker.
B
A property was listed for sale at $185,000. Four offers are presented. Which offer BEST describes an offer made by a ready, willing and able buyer? A. An offer for $175,000, all cash. B. A full price offer, from a financially qualified buyer, subject only to financing at current market rates. C. An offer at full price contingent upon the buyer (offeror) first selling his current residence. D. A full price offer contingent upon the seller "taking back" a second trust for $15,000.
B
A salesperson represents the: A. Seller. B. Broker. C. Buyer. D. Lender.
B
A broker is representing a buyer. When the broker is showing property, he may NOT disclose to his buyer: A. The current owner is infected with the HIV virus. B. Information the broker knows about the financial condition of the seller. C. Deed restrictions that might affect the buyer´s intended use of the property. D. That the seller will not accept an offer based on VA financing.
A
A buyer enters into a contract for the purchase of property, agreeing to make a specified down payment, and further agreeing to regular monthly payments to the seller, who is holding legal title, for a specified period of time. This describes what type of contract? A. Installment contract. B. Purchase money mortgage. C. Option contract. D. Agreement contract.
A
A clause in a lease that provides for increases in rents due to changes in costs or taxes is known as a/an A. escalator clause. B. habendum clause. C. acceleration clause. D. prepayment penalty clause.
A
A commercial tenant's rent is increased because a property is shown to have increased in value by a recent appraisal of the property. This lease is most likely a(n): A. Revaluation lease. B. Index lease. C. Percentage lease. D. Net lease.
A
A salesperson receives an earnest money deposit on Monday while working with broker Allan. On Friday, the salesperson goes to work for broker Bob. What should be done with the earnest money deposit? A. It stays with broker Allan. B. It goes to broker Bob. C. It should be given to the seller. D. It is returned to the buyer.
A
An agent may discriminate against a potential buyer on the basis of A. inability to pay. B. sex. C. race. D. none of these options.
A
An agreement in which rent is increased at specified intervals is known as: A. Graduated rental lease. B. Participation lease. C. Acceleration lease. D. Net lease.
A
An attorney-in-fact need not be an attorney-at-law. A. True B. False
A
An offer is made to a seller. Prior to acceptance of the offer, the buyer finds another house he likes better at a cheaper price. Under these circumstances, the buyer: A. May withdraw the offer. B. May not make an offer on the second house until the first offer is rejected. C. Can make an offer on the second house without fear of recourse from the first seller. D. Is bound by the terms of the original offer.
A
During the term of the lease, the lessor of a property holds what form of estate in the property? A. Leased Fee. B. Leasehold. C. Estate for Years. D. None of the above.
A
Each of the following would be considered a "person with a disability," EXCEPT: A. An individual who currently uses illegal drugs. B. A person with a past history of mental impairment. C. A person with a learning disability. D. A person who has difficulty walking.
A
Many Korean families have purchased homes in an older neighborhood of your community. Most merchants in the area now cater to the Korean clientele. A Caucasian resident of the area has listed his house for sale with your firm. You list the property in the MLS. You also place a bi-lingual ad in the newspaper and a bi-lingual "For Sale" sign on the property. Are your actions discriminatory? A. No, this is proper marketing practice. B. No, because you are targeting the market most likely to purchase the property. C. Yes, because national origin is protected by the 1968 Fair Housing Law. D. Yes, because bi-lingual ads are a form of steering.
A
Most leases do not allow assignment without the consent of the landlord. A. True B. False
A
One who engages another to act for him or her under a contractual agreement is referred to as: A. A client. B. An agent. C. A seller. D. A testator.
A
The legal process of removing a tenant from property is: A. Eviction. B. Ejection. C. Quitting. D. Constructive notice.
A
Under a contract for deed, the buyer: A. Receives an insurable interest B. Receives legal title C. Is not allowed possession of the property until the purchase price is paid D. Has a fee simple estate
A
Which of the following individuals would be considered a member of the "familial status" protected class? A. A same-sex couple who are in the process of adopting a child. B. A married couple with no children. C. A single female. D. All of these choices.
A
An apartment complex has a "no pets" policy. Mary is a blind person who applies to rent a unit, but she wants to have her certified guide dog live in the apartment with her. This request: A. Can only be granted if the landlord agrees to remove the "no pets" policy. B. Should be considered a "reasonable accommodation." C. Should be considered a "reasonable modification." D. Cannot be granted.
B
Broker Jenkins has presented an offer from buyer Frazer. Before the seller has accepted the offer, Jenkins is informed that Frazer is acting for an unknown purchaser in this transaction. What should Jenkins do in this situation? A. Inform the seller that the offer is void. B. Inform the seller of the existence of an unknown purchaser. C. Return the earnest money deposit to Frazer. D. Inform Frazer that his offer is illegal.
B
How does a purchaser obtain equitable title to a property? A. With an abstract. B. Through a valid contract. C. By deed. D. By an estoppel certificate.
B
If Jan makes a counteroffer in response to Joe's offer to buy Jan's house, Joe is bound by his original offer. A. True B. False
B
If a broker lists a property, she CANNOT be: A. A dual agent. B. A buyer's agent only. C. An agent for the seller only. D. An agent for both buyer and seller.
B
If a person pays for the right to purchase property at a specified price, within a specified time, the person has: A. A right of first refusal. B. An option. C. A sales contract. D. A lease.
B
In 1968 the Supreme court ruled in the Jones vs. Mayer Co. case. The courts' decision upheld the law which provides protection on the basis of: A. Sexual discrimination. B. Racial discrimination. C. Discrimination on the basis of national origin. D. Religious discrimination.
B
Laura Licensee tells people that the ethnic characteristics of the neighborhood are changing and they should consider selling their homes because of this. Laura has engaged in: A. Steering. B. Blockbusting. C. Redlining. D. Reverse redlining.
B
Leases are unilateral contracts that survive the death of the parties. A. True B. False
B
A licensed real estate salesperson may legally accept an extra commission for a difficult sale from: A. An appreciative seller. B. A thankful buyer. C. His or her broker-employer. D. The mortgage lender.
C
A graduated lease is defined as one: A. That includes an option to purchase. B. In which all expenses are paid by the lessor. C. In which there may be an increase or decrease in rent at a stated future time. D. Whereby rent increases with each new tenant.
C
Adeline is selling her own home as a For Sale By Owner (FSBO). On Sunday, a full price offer is made by an Asian couple. Adeline refuses the offer made by the couple. On Monday, Adeline accepts an offer, $4000 below the asking price from a Caucasian family. Has Adeline violated any laws and if so which one? A. There is no violation because homeowners selling their own property are exempt from Federal Fair Housing laws B. Adeline has violated the Federal Fair Housing Act of 1968 C. Adeline has violated the Civil Rights Act of 1866 D. Adeline has violated the state license laws
C
An owner sells his property and immediately leases it back from the purchaser. This describes: A. An option. B. A wraparound mortgage. C. A sale and leaseback transaction. D. A right of first refusal.
C
Bill, the buyer, signs an offer to purchase agreement and gives broker Joan, a $1,000 earnest money deposit. The next day, before Joan has a chance to present the offer to the seller, Bill finds he needs his $1,000. What should he do? A. Ask the broker to return his money. B. Nothing because he is bound to go through with the offer. C. Withdraw his offer and ask Joan for his money. D. Give Joan $500 for letting him out of the contract.
C
Each of the following statements is correct about property subject to a sublease, EXCEPT: A. The sublessor remains solely liable for the rental payments. B. Landlords can include a clause in the lease requiring lessor approval of any sublease arrangement. C. The sublessee makes the rental payments directly to the landlord. D. The original lessee becomes the sublessor.
C
Encouraging a homeowner to sell his or her property because minority group families are moving into the neighborhood is: A. Redlining. B. Steering. C. Blockbusting. D. Puffery.
C
If a person has been discriminated against in a real estate transaction, they would file a complaint with the: A. Local Association of Realtors. B. National Association of Realtors. C. Department of Housing and Urban Development. D. Department of Health, Education and Welfare.
C
In the event a person was deemed mentally ill but is later found to be free of any mental illness, this person is: A. Still ineligible to sign contracts. B. Can be discriminated against for other reasons C. Competent and should be treated as any other person D. No longer protected under the Americans with Disabilities Act (ADA)
C
In the process of taking a listing, a licensee noticed water stains on the ceiling in one of the rooms. What should the licensee do? A. Ignore it on the theory of caveat emptor. B. Ignore it if the stain is old. C. Inquire of the owner if there is a leak. D. Advise the owner to paint over the stain.
C
Nice and Easy Loan Company has a policy of either restricting the availability of loans or requiring lower LTV ratios for loans made in areas of the community which they consider "high risk" areas. This practice is known as: A. Steering. B. Blockbusting. C. Redlining. D. Good business.
C
Smith died and his real property was sold. Which of the following determines the amount of commission paid to the broker handling the sale? A. The State Real Estate Board or Commission B. The local bar association C. The listing signed by the broker and the executor or administrator for the estate D. The State Association of Realtors
C
The 1988 amendment to the Fair Housing Law affords protection on the basis of familial status. Which of the following best defines a family as it applies to this amendment? A. Legally married persons. B. A household in which there are children related to the adults by blood. C. A household in which there are children under 18 years of age. D. Any household in which there are children, regardless of age.
C
The Anytown Helpers is a charitable group run by a local church. They provide temporary low-cost housing to people with children who are poor and/or victims of abuse. They give preference to those who are members of the church. Does this violate the Fair Housing Act of 1968? A. Yes, in all cases. B. No, in no case. C. No, as long as the church does not discriminate in membership against any protected class. D. Yes, unless the church has received a specific waiver from HUD.
C
The Fair Housing laws do NOT provide protection on the basis of: A. Gender. B. Handicapped. C. Homosexuality. D. Single parenthood.
C
To be legally binding, a real estate sales contract must contain a A. termite clause. B. list of personal property. C. legal description. D. commission.
C
When a landlord enters into a lease with a tenant, the landlord is obligated for all of the following EXCEPT: A. Allow the tenant the right of quiet enjoyment. B. To maintain the property in a safe and habitable condition. C. Allow the tenant to use the property in any manner the tenant chooses. D. Allow possession of property, by the tenant.
C
When a mortgagee substitutes a new party for another on a mortgage in order to release the original borrower of liability, it is referred to as: A. Satisfaction. B. Subordination. C. Novation. D. Substitution.
C
Which of the following is (are) true regarding the Multiple Listing Service? A. It can only accept residential listings. B. It can establish minimum and maximum commission rates. C. It can refuse to accept open listings. D. All of these choices.
C
Which of the following is NOT a form of steering? A. Excluding African Americans or Hispanics from a Caucasian community. B. Attempting to attract only Hispanic prospects to an Hispanic neighborhood. C. Attempting to have Caucasian homeowners sell their homes by representing that African Americans are attempting to buy in the neighborhood. D. Efforts to keep Asians out of a Caucasian neighborhood.
C
A broker brought a ready, willing and able minority buyer who signed an offer to buy a house at the listed price. Because of the buyer's race, the sellers refused the offer. The broker may legally take all of the following actions EXCEPT: A. Sue the seller for his commission. B. Advise the prospect of his right to complain to the U.S. Department of Housing and Urban Development (HUD). C. Warn the sellers that their refusal is a violation of Fair Housing laws. D. Market the house only to non-minority customers.
D
A broker, acting as a dual agent, with the knowledge and consent of all parties, collected one-half the commission from the seller and one-half from the buyer at settlement. Which of the following statements is true concerning this situation? A. This action is illegal. B. The broker needed only the consent of the seller. C. The broker needed only the consent of the buyer. D. This action is permitted only with the consent of both parties.
D
A clause in a lease which enables the lessor to raise the rent in the future is called a(n): A. Protective covenant. B. Restrictive covenant. C. Subordination clause. D. Escalator clause.
D
A salesperson wishes to charge a reduced commission to her sister. Where would the salesperson obtain approval for such an arrangement? A. State Association of Realtors. B. Local Association of Realtors. C. Real Estate Board or Commission. D. None of these choices.
D
Andrew, an owner, lists his home with salesperson Heidi with the provision that the house not be shown if he is not at home. Andrew leaves town on Monday for a two-week business trip. On Tuesday, Jose and Maria, a minority couple, contact Heidi and want to see Andrew's house. Heidi refuses to show the house. In this situation, which of the following statements is true? A. The couple should file a discrimination suit against Andrew, the owner of the property. B. The couple should complain to Heidi´s broker and demand to be shown the property. C. The couple should sue Andrew, Heidi and the broker for refusing to deal which is a violation of Fair Housing laws. D. Heidi´s refusal to show the property is in keeping with her duties to Andrew and she has not violated the law.
D
Baker gives a real estate licensee a power of attorney. The licensee is called a/an? A. agent in place. B. real estate broker. C. attorney-at-law. D. attorney-in-fact.
D
Generally, a property manager may NOT be compensated by receiving A. a percentage of the gross lease. B. a fee for leasing. C. a fee for supervising repairs. D. rebates from suppliers unless disclosed to the owner.
D
How can a broker best demonstrate his compliance with Fair Housing laws? A. Display the Equal Housing Opportunity Poster in the office and all places of business. B. Document all transactions with all clients or customers. C. By showing all prospective buyers all property for which they are financially qualified. D. All of these choices.
D
How many brokers can be given an open listing? A. One. B. Two. C. Three. D. As many as the owner chooses.
D
If a prospective buyer (who is of a minority group) asks an agent to show her properties, the agent should: A. Show her properties in areas that are predominantly of the same minority group. B. Refer her to an agent in the firm of the same minority. C. Advise her that the firm does not handle people of her minority group and refer her to another brokerage. D. Show her any property for which she is financially qualified.
D
If a seller breaches a valid and enforceable sales contract, the purchaser may A. sue for damages. B. rescind. C. sue for specific performance. D. any of these options.
D
If the landlord (owner) of property dies during the period of a valid lease, what effect would it have on the lease and the tenant? A. The lease is void, by operation of law. B. The lease would be voidable, at the option of the tenant. C. The right of possession would revert to the estate of the deceased. D. It has no effect.
D
In what type of listing would the listing broker be paid the commission if the listing broker or any other broker was the procuring cause, but not if the seller found the buyer personally? A. Net listing. B. Open listing. C. Exclusive right to sell listing. D. Exclusive agency listing.
D
Larry Licensee runs an ad for one of his listings. The ad contains the phrase "nearby St. Andrew Roman Catholic Church." This would be considered: A. Acceptable advertising if true. B. A violation of the separation of church and state. C. A violation of the Civil Rights Act of 1866. D. The use of a "trigger term" under the Fair Housing Act of 1968.
D
Seller Chaney has rejected three offers which were all $2,500 below the listed price of her home. Broker Rudy receives a fourth offer which is also $2,500 below the listed price. What should Rudy do? A. Tell the prospective buyers to forget it, as the same offer has already been rejected by Chaney. B. Tell the prospective buyers their offer will be submitted to Chaney only if they increase the offered price. C. Hold the offer to see if a better one comes in. D. Immediately submit this offer to Chaney.
D
Under a net lease, which of the following is the tenant NOT required to pay? A. Taxes B. Repairs C. Utilities D. Mortgage
D
Unless agreed to in writing by all the parties, the broker is not entitled to a commission until the transaction has been consummated. A. True B. False
A
When a seller makes a counteroffer, which of the following statements is NOT true? A. It is a partial acceptance of the original offer. B. The original offeror becomes the offeree in the counteroffer. C. It is a rejection of an earlier offer. D. It may be withdrawn at any time prior to acceptance.
A
If an offer is rescinded, it is: A. Revised. B. Altered. C. Terminated. D. Accepted.
C
A listing agreement with a seller may be terminated by: A. The seller. B. The buyer's broker. C. The salesperson that obtained the listing. D. Death of the salesperson.
A
How many agents are there in an exclusive right-to-sell listing? A. One. B. Two. C. Three. D. As many as the owner chooses.
A
If a broker accepts a promissory note or post-dated check as a deposit on an offer, that information must be disclosed to the seller. A. True B. False
A
The vendee is: A. One who buys or offers to buy. B. One who sells or offers to sell. C. The lender. D. The borrower.
A
An open listing contract in which the seller agrees to pay a commission to the first broker who produces a ready, willing, and able buyer is a bilateral contract. A. True B. False
B
An agent has the responsibility of care, obedience, accountability, loyalty and disclosure to which of the following? A. The customer. B. The buyer. C. The client. D. All of these choices.
C
Net listings are acceptable in most states. A. True B. False
B
Which of the following agency responsibilities most likely would be limited in dual agency representation? A. Fairness. B. Reasonable care. C. Disclosure. D. Accounting.
C
Which of the following contracts is voidable? A. One of the parties to the contract is legally insane. B. One of the parties did not sign the contract. C. One of the parties was drunk at the time the contract was signed. D. The subject of the contract was for an illegal purpose.
C
An agency relationship can be terminated in which of the following ways? A. Death of the client. B. Renunciation by the agent. C. Revocation by the client. D. Any of these choices.
D
How can an agency relationship be created? A. Written document. B. Action of the parties. C. Words of the parties. D. Any of these choices.
D
Which of the following could be recognized as consideration in a valid contract? A. A mortgage note with interest. B. A promise to install a cabinet. C. A note without interest. D. Any of these choices.
D
When may a counteroffer be withdrawn? A. Within twenty-four hours after acceptance. B. Within thirty-six hours after acceptance. C. At any time before acceptance. D. At any time before closing.
C
Which of the following would NOT be an agent? A. A real estate salesperson handling only referrals. B. A property manager employed by the owner. C. A person working for a multiple listing service. D. A person holding a power of attorney.
C
Broker Johnson has listed the property of Cheever and sells it to Brevard for $175,000. Before closing, Johnson finds that the property has a serious structural defect. What should Johnson do? A. Tell Cheever. B. Tell Brevard. C. Keep it quiet as it might kill the sale. D. Tell both Cheever and Brevard.
D
Broker Macro was showing a tract of land with irregular boundaries. When asked about a boundary, Macro indicated that it ran from the edge of the stone wall to the creek. Macro knew this was not exactly correct. After the buyer contracted for the property, he was shown a survey which reflected the true boundary. Was Macro guilty of misrepresentation? A. No, verbal statements are not binding. B. No, the buyer was responsible for having the property surveyed. C. Yes, the broker was responsible for verifying the official records. D. Yes, because Macro knew his statement was not completely accurate.
D
If a broker has an exclusive right-to-sell listing, which of the following statements is INCORRECT? A. There must be a definite termination date in the listing. B. All money given, by the seller to the broker, must be accounted for. C. The broker may cancel the listing if he chooses. D. The broker is legally obligated to sell the property.
D
A broker decides to lower the prices of her listings after the properties have been on the market for 120 days. She finds that more buyers are now calling on these listings. Which of the following is true about such a practice? A. She can do this only with the local Association of Realtors approval. B. She can do this only with the owner's approval. C. She can do this only after informing all previous buyers. D. This is an excellent marketing technique.
B
A person that has the legal authority to act for another is: A. A listing broker. B. An attorney-at-law. C. An attorney-in-fact. D. An ostensible agent.
C
A purchaser submits an offer to a seller with the condition that the property is to be financed by a conventional loan at no more than 10% interest. If the seller agrees but such financing cannot be obtained, which of the following is true? A. The purchaser loses his deposit but is relieved of further liability. B. The seller is obligated to return the deposit plus interest. C. The purchaser may request his deposit be returned. D. The seller can sue for specific performance.
C
Brokers must hold their client's funds in a/an A. office safe. B. savings account. C. trust or escrow account. D. special account managed by the Board of Realtors.
C
Sam, an adult, contracted to buy a vacant lot from Jerry. Several months later Sam found out that Jerry was only 17 years old. Which of the following is true regarding the sales contract? A. The contract is valid and binding on both parties. B. The contract is voidable by either party. C. The contract is voidable by Jerry only. D. The contract is void.
C
Sara Seller hired Larry Licensee to sell her home under specified terms. Larry Licensee would most likely be a(n): A. Subagent. B. Universal agent. C. Special agent. D. General agent.
C
The maximum fine is $16,000 for violations of the: A. CAN-SPAM Act. B. Do Not Call Registry. C. Both the CAN-SPAM Act and the Do Not Call Registry. D. Neither the CAN-SPAM Act nor the Do Not Call Registry.
C
When does title pass in an installment sales contract (land contract)?. A. At closing. B. In one year. C. When the debt has been satisfied. D. When the contract is signed.
C
A broker obtains an open listing on a piece of property. In order to collect a commission on the sale of this property, the broker must be able to prove which of the following? A. He was licensed at the time of the sale. B. He was employed at the time of the sale. C. He was the procuring cause of the sale. D. All of these choices.
D
Licensee Larry has held a real estate license for many years and has completed many residential transactions but never any commercial transactions. His neighbor owns a small strip mall and asks Licensee Larry to sell the property. Licensee Larry should be especially careful to consider which of the following duties to the client? A. Disclosure. B. Accounting. C. Confidentiality. D. Reasonable care and due diligence.
D
A housing complex may advertise itself as being for Senior Citizens if: A. 100% of residents are at least 62 years old. B. 80% of residents are at least 55 years old. C. Either of the 2 choices. D. None of these choices.
C
A landlord and tenant's mutual agreement to cancel a lease is best described as a A. release and surrender. B. rescission and acceptance. C. surrender and acceptance. D. release and acceptance
C
The protection clause in a contract: A. Protects the buyer and seller from breach of contract. B. Assures the broker will be paid a commission. C. Ensures the broker a commission if the seller and buyer enter into a contract after the listing has expired. D. Safeguards the borrower from foreclosure by a lender.
C
Two brothers who each own their own real estate companies agree to divide commissions received equally. Broker A pays for three-fourths of the advertising costs and finds the buyer. Broker B pays one-fourth of the advertising costs. If the total commission on the sale is $4,500, how much does Broker B get? A. $4,500. B. $1,125. C. $2,250. D. None of the above.
C
What is the purpose of a liquidated damages clause in an offer to purchase a property? A. To set a specific time limit to complete the transaction. B. To give the buyer a "due diligence" period during which the buyer could rescind the contract. C. To specify what damages the seller may collect if the buyer defaults on the contract. D. To allow the seller to sue the buyer for damages if the buyer breaches the contract.
C
Which of the following is NOT specifically protected by the various fair housing statutes? A. People in a particular religious group B. People who are physically handicapped C. Current drug users D. Persons previously confined to a mental institution
C
Which of the following is required for a contract to be valid? A. In writing. B. An earnest money deposit. C. Consideration. D. Signature and seal of a notary public.
C
Which of the following statements is true regarding time limits for complaints regarding alleged violations of the Fair Housing Act? A. The time limit is 1 year for both complaints to HUD and federal lawsuits. B. The time limit is 2 years for both complaints to HUD and federal lawsuits. C. The time limit is 1 year for complaints to HUD and 2 years for federal lawsuits. D. The time limit is 2 years for complaints to HUD and 1 year for federal lawsuits.
C
Which type of listing agreement gives the broker maximum protection? A. An open listing B. A net listing C. An exclusive right-to-sell D. An exclusive agency listing
C
William Wells, a principal broker, listed parcel A under an exclusive agency listing agreement and listed parcel B under an exclusive right-to-sell agreement. Both listings expired. Three days later, without seeing each other's property beforehand, the two owners exchanged properties in a Like-Kind exchange. William will receive: A. One commission. B. Two commissions. C. No commission. D. A split commission.
C
Mark gives Suzanne the authority to sign for him in a real estate transaction. Suzanne is considered, in the eyes of the law, to be: A. A broker. B. An attorney-in-fact. C. An attorney-in-trust. D. An attorney-at-law.
B
The Civil Rights Act of 1866 prohibits discrimination on the basis of: A. Sex. B. Race. C. Religion. D. Marital status.
B
The Federal Fair Housing Act is intended to protect the public from all of the following, EXCEPT: A. Blockbusting. B. Price fixing. C. Steering. D. Redlining.
B
The Federal Fair Housing Act may be enforced by bringing complaints to A. the Federal Housing Administration. B. the Department of Housing and Urban Development. C. The U.S. Court of Appeals. D. The U.S. Department of Commerce.
B
The enforcement of the Fair Housing Law of 1968 is the responsibility of: A. The Federal Housing Administration. B. The Department of Housing and Urban Development. C. The Federal National Mortgage Association. D. The Government National Mortgage Association.
B
Transvestites and drug addicts are protected classes under Federal Fair Housing Laws, who cannot be discriminated against in housing. A. True B. False
B
Under the customary listing agreement, the broker, as the agent for the seller, can: A. Accept or reject offers for the seller. B. Place a "For Sale" sign on the property. C. Deposit earnest money in the broker's personal account. D. Advertise the property at a price lower than the listed price.
B
When a real estate broker is retained to perform one specific act for a client, it is known as A. general warranty. B. special agency. C. general agency. D. special warranty.
B
Which of the following is NOT essential to a valid sales contract? A. Competent parties. B. Termination date. C. Consideration. D. Mutual agreement.
B
Which of the following listing agreements is LEAST likely to specify a commission rate? A. Open listing. B. Net listing. C. Exclusive agency. D. Exclusive right-to-sell.
B
Which of the following statements about options is true? A. The optionor can void the option if another offer is submitted. B. The optionee can allow the option to expire. C. The optionee can extend the option period automatically. D. Options only involve raw land.
B
Licensee Larry has a listing on a seller's home. He shows the home to Patti Prospect who is looking to purchase a home. Licensee Larry has not inquired about the condition of the roof with the seller. Patti Prospect asks about the condition of the roof and Licensee Larry says that he is sure the roof is fine. After the purchase closes the first rain storm hits and it is apparent that the roof leaks. Which of the following statements best describes this scenario? A. This is deliberate fraud and the contract is voidable. B. This is a misrepresentation and the contract is void. C. This is a mistake but the contract is not voidable. D. This is misrepresentation and the contract is voidable.
D
Salesperson Susan sells to buyer Pete, a home belonging to seller Tom. At the same time she writes a six month option for Pete to buy an adjoining lot, also from Tom. When does Susan earn her commission on the option contract? A. When she is paid her commission on the sale of the home. B. When the optionor and the optionee are brought together. C. When local custom dictates, she has earned it. D. None of the above.
D
Upon signing a management contract with an owner, a broker becomes a/an: A. Trustee. B. Receiver. C. Director. D. Agent.
D
When a contract is breached, the injured party A. may not sue for money damages. B. may not sue for specific damages. C. may rescind the contract bilaterally. D. may rescind the contract unilaterally.
D
When a lessee assigns his or her leasehold interest in a property, all of the following statements are true, EXCEPT: A. The assignor transfers all of his or her rights in the property to the assignee. B. The assignee pays the rent directly to the landlord. C. The lessor has the right to require prior approval of the assignment. D. The assignor remains primary liable for the rental payment
D
Which of the following MUST be disclosed by an agent to his client, in a real estate transaction? A. Minority groups are moving into the area. B. The average commission recommended by the local real estate association. C. The buyer intends to violate deed restrictions. D. The buyer has had previous credit problems which may have an impact on loan qualifications.
D
Which of the following property owners would be exempt from the prohibition against discrimination in the Civil Rights Act of 1866? A. The owner of a single-family residence who owns 3 or less such residences and does not use a licensed real estate agent. B. A religious organization that gives housing preferences to its members. C. Both of these choices. D. None of these choices.
D
Which of the following would cause what appears to be a valid contract to be declared void or invalid? A. Misrepresentation by one of the parties. B. Undue influence or duress. C. A mistake in fact. D. Any of the above.
D
Which of the following would not be legally sufficient to support consideration in a sales contract? A. Money B. Property C. Service D. Love and affection
D
Who is required to comply with the Fair Housing Laws? A. Only real estate professionals. B. Real estate professionals and lenders. C. Real estate professionals, lenders and insurance companies. D. Everyone, unless specifically exempted by the law.
D
XYZ Mortgage Co. has an established 80% L/V ratio on loans for owner occupied housing. It has further established that home loans made for property located in the Sand Hills subdivision require a 70% L/V ratio because this subdivision is considered less desirable. Which of the following statements is correct? A. A minority person applying for a home loan in the Sand Hills subdivision can only be required to meet the 80% L/V criteria. B. XYZ is prohibited by the Federal Fair Housing Law from having two separate loan policies. C. Real estate brokers would be in violation of the Fair Housing Law if they refer prospective buyers to XYZ for any loan. D. The policy of XYZ is referred to as redlining.
D
An offer is made to a seller and the seller makes a counteroffer. Prior to the buyer accepting the counteroffer, the seller receives a better offer from another prospective buyer. Under these circumstances, the seller: A. May withdraw the counteroffer. B. Should advise the second offeror to wait. C. Can accept the second offer without recourse. D. Is bound by the terms of the counteroffer.
A
Barry makes an offer to purchase a home being sold by Pam. Pam does not accept Barry's offer, but makes a counteroffer. Relative to the counteroffer, which of the following statements is INCORRECT? A. If Barry does not accept the counteroffer, Pam has the choice to then accept Barry's original offer. B. Barry is now considered to be the offeree. C. The counteroffer rejects Barry's offer completely. D. Pam may withdraw the counteroffer at any time, prior to acceptance by Barry.
A
Broker Betty has a listing on Seller Sara's house. Broker Betty puts the listing on the local MLS -- agreeing to share the commission with any other member broker who finds a buyer for the house. Up through the 1970s if another broker found the buyer, that broker would be considered a(n): A. Subagent. B. General Agent. C. Universal agent. D. Special agent.
A
In many states, the Statute of Frauds applies to listing agreements. A. True B. False
A
Oral leases for a period of a year or less do not fall within the Statute of Frauds that requires many contracts to be in writing. A. True B. False
A
A real estate sales contract does not survive the death of one of the parties. A. True B. False
B
If a seller has delivered a deed into escrow, but dies before the closing of the sale, the deed is not considered to have been delivered, and the sale need not be consummated. A. True B. False
B
The instrument authorizing one person to act for another person is: A. An attorney in fact. B. A power of attorney. C. An estoppel certificate. D. A certificate of no defense.
B
A buyer enters into a contract for the purchase of property, agreeing to make a specified down payment, and further agreeing to regular monthly payments to the seller, who is holding legal title, for a specified period of time. This describes what type of contract? A. Installment contract. B. Purchase money mortgage. C. Option contract. D. Agreement contract.
A
A client is obligated to her agent for A. indemnification against loss not caused by the agent. B. reimbursement. C. performance. D. all of the above.
A
A listing agreement may be terminated by: A. The seller B. The buyer´s broker C. The salesperson that obtained the listing D. Death of the salesperson
A
If a buyer submits an offer to buy and the offer contains a contingency clause, the resulting contract is: A. Valid if the contingency is accepted by the seller. B. Invalid. C. Only valid if accepted by the seller within 24 hours. D. Illegal.
A
Real estate licensees are required to disclose pertinent information relative to property they list. Which of the following are you NOT required to disclose? A. The seller is having financial problems and must sell the property to avoid bankruptcy. B. The state plans to build a new highway near the property. C. The property is subject to seasonal flooding. D. The interior of the house is badly in need of painting .
A
A buyer and seller have a legal real estate contract. The contract does NOT address the issue of death by either party. If the seller dies, prior to closing, which of the following is true? A. The contract becomes null and void. B. The contract remains valid and enforceable. C. The sellers estate may cancel the contract. D. The contract is void by operation of law.
B
A broker has entered into a signed listing agreement. Which of the following reasons would make the agreement voidable? A. The agreement specifies that no other broker may show the property. B. The seller, being illiterate, signed the agreement with an "X". C. The seller was under the influence of alcohol when the contract was signed. D. The contract specified a 10% commission to be paid.
C
A broker has the buyer's earnest money deposit deposited in an escrow account. The amount of the deposit exceeds the amount of the broker's commission for the sale. The broker may remove his commission on this sale ONLY: A. When the buyer moves into the property. B. When the seller moves out of the property. C. When the closing is completed. D. Whenever the seller says it is ok to do so
C
A buyer requests the broker take a listed property off the market until his wife sees the property. Should the broker do this? A. Yes, as long as his wife can see it before the next business day. B. Yes, if the buyer pays the brokerage firm a small fee for this service. C. No, this would violate the agency agreement. D. No, only the local Association of Realtors can approve such an arrangement.
C
A real estate broker wishes to deposit an earnest money check in his business operating account until settlement, so the purchaser can earn a higher rate of interest on his funds. Can he legally do this? A. Yes, if the purchaser receives a comparison of available interest rates B. Yes, if the broker promises to insure such funds will be available at closing C. No, these funds must be placed in a separate escrow account D. No, the broker cannot guarantee a higher interest rate
C
A seller signs a listing with the provision that any commission will be split between the brokerage firm handling the sale and the seller's unlicensed brother. Is this agreement legal? A. Yes, as long as the brother has contractual ability. B. Yes, if the brother assists in the negotiation. C. No, the brother must be a licensed real estate broker to receive a commission. D. No, the local board of Realtors must first approve this agreement.
C
An offer is accepted by all parties with a settlement date of September 5. Three days prior to settlement the purchaser notifies the seller that funds are not available and settlement cannot take place as scheduled. Which of the following options are available to the seller? A. Sue for specific performance. B. Sue for monetary damages. C. Allow rescission of the contract. D. Any of these choices.
D
An optionee is obligated to do which of the following? A. To rezone a property prior to exercising his option. B. To convey further assurance to the optionor. C. To exercise the option within 60 days. D. To pay consideration for the option right.
D
Broker Fowler located a property for buyer Jackson. Jackson paid seller Allan a $1,000 fee for a 30 day option. Which of the following is true? A. Fowler earned his commission when the option was signed B. Part of Fowler´s commission will come from the $1,000 C. Local custom will determine the commission D. Fowler will not earn a commission until Jackson becomes owner of the property
D
If an offer is mailed to the seller, a contract exists when A. the buyer receives the acceptance in the mail. B. the agent receives the acceptance in the mail. C. the seller mails his acceptance. D. the seller calls the agent and informs him of the acceptance.
C
When a contract is entered into based strictly on the actions of the parties involved, it would be considered to be which type of contract? A. Unilateral. B. Executed. C. Implied. D. Expressed.
C
A valid contract is one which: A. Serves a lawful purpose. B. Is enforceable against one of the parties. C. Has been signed by both parties. D. Contains all of the essential elements of a contract.
D
An oral listing is: A. Void. B. Voidable. C. Illegal. D. Unenforceable.
D
If an optionee does NOT exercise his option rights during the option period, which of the following would occur? A. The optionee can ask for a return of any consideration paid. B. The optionee can be sued by the optionor. C. The optionor can be sued by the optionee. D. The optionee gives up the consideration paid for the option right.
D
One party to a contract has the right to change his mind and not perform as agreed. This right A. can be a condition of the contract itself. B. can be created by statute. C. may require payment of monetary damages. D. could be any of the above.
D
A contract to hire someone to commit an illegal act would be A. Voidable. B. Subject to rescission. C. Void. D. Valid as to the employer, voidable by the person hired.
C
Only the seller may attempt to sell property listed under an open listing. A. True B. False
B
An agency relationship can exist between: A. Salesperson and employing broker. B. Broker and seller. C. Broker and buyer. D. All of these choices.
D
A broker listed a vacant lot zoned for residential use. Later, an adjacent lot was rezoned causing an increase in value. What should the broker do? A. Buy the listing, have it rezoned, then sell it for a profit. B. Tell the seller of the zoning change and advise the seller to consider application for rezoning the property. C. Continue to market the property as residential property, according to the terms of the listing. D. Offer to terminate the listing agreement.
B
A general agency empowers the agent to A. transact matters of all types for the client. B. transact the client´s affairs in a certain business. C. perform only specific acts for the client. D. perform any legal act for the client.
B
A legal procedure or action initiated by either buyer or seller to enforce the terms of a sales contract is known as: A. An option. B. A suit for specific performance. C. A suit for quiet title. D. A statute of frauds.
B
A person that authorizes another to act for him or her is known as the: A. Agent. B. Client. C. Broker. D. Customer.
B
A salesperson can set up escrow accounts for each of his or her clients, in the name of the client and the salesperson. A. True B. Flase
B
Broker Bob has opened an escrow account and has deposited a buyer's earnest money deposit in that account. Broker Bob later learns that a different customer is about to file a lawsuit against him so he deposits $100,000 of his own money in that account. This action constitutes: A. Conversion. B. Commingling. C. Disintermediation. D. Wise business practice.
B
Licensee Laurie makes a listing presentation to Seller Steve. Steve agrees to give Laurie a listing and agrees to pay her a commission upon sale, but refuses to sign any written contract. How was this agency relationship created? A. There is no agency relationship since it is not in writing B. This is an expressed agency C. This is an implied agency D. This is agency by ratification
B
The loan contingency clause in a valid sales contract will contain all of the following except A. the amount of the loan. B. the name of the lender. C. the date of the commitment. D. the interest rate of the loan.
B
Bill, the buyer, signs an offer to purchase agreement and gives broker Joan, a $1,000 earnest money deposit. The next day, before Joan has a chance to present the offer to the seller, Bill finds he needs his $1,000. What should he do? A. Ask the broker to return his money B. Nothing because he is bound to go through with the offer C. Withdraw his offer and ask Joan for his money D. Give Joan $500 for letting him out of the contract
C
Casper is planning to sell his house and desires the broadest possible exposure. He gives Bert an exclusive right-to-sell listing, Gail an exclusive agency listing and Mark an open listing. Mark sells the house. Under these circumstances, which of the following statements is true? A. Mark must split his commission with Bert and Gail. B. Casper owes two commissions, one to Mark and one to Bert and Gail to be split between them. C. Casper owes 3 commissions. D. Mark is the only one who will receive a commission.
C
David, an independent and individual broker, dies. His daughter, a licensed broker and only heir, inherits the brokerage business. If she intends to operate the brokerage and keep the listings, it is necessary that she: A. File legal notice of her intent to assume responsibility for the brokerage business. B. Advise the probate court of her intent to assume responsibility for the listing agreements. C. Negotiate and receive new listing agreements from each client. D. Nothing is required because she is the only heir.
C
If a listing broker tells a prospective buyer, ".. go ahead and make that offer, I'm sure the seller will accept it...", the broker may have created an agency relationship which would be described as: A. General agency B. Express agency C. Implied agency D. Unilateral agency
C
Seller Corcoran is in very poor health and cannot work his farm. Should a broker, who has a listing on the farm, disclose this fact to prospective buyers? A. Yes, it is a material fact about the farm which Moore must disclose. B. Yes, it may help to get at least a low offer and help sell the farm. C. No, it may hurt Corcoran's bargaining position and hurt his chances to get a fair price for the property. D. No, it would be a violation of Federal Fair Housing Laws.
C
A listing agreement must contain all of the following information EXCEPT: A. The signature of the owner of the property. B. The percentage of commission or fee. C. An expiration date. D. The net amount that the seller will receive.
D
An escrow account is maintained by a broker for the purpose of A. earning interest for the broker. B. earning interest for the broker�s clients. C. disposition of money to the buyer. D. impartial protection of both parties.
D
Barry, a sales agent with XYZ Realty lists a property. Helen, also a sales agent with XYZ, presents an offer from one of her clients and the offer is accepted. Which of the following best describes the position of the broker and XYZ in this situation? A. The broker is an agent for the buyer only. B. The broker is an agent for the seller only. C. The broker is agent of the seller and sub-agent of the buyer. D. The broker is a dual agent.
D
Broker Boyd takes a listing on a property owned by Foster at a price of $75,000 with no more than 20% down. Five days later, Boyd secures a written, all cash, offer for $75,000 on the Foster property. Foster refuses the offer. What can Boyd do under the circumstances? A. Demand that Foster accept the offer. B. Demand that Foster pay him a full commission since he secured a full price offer. C. Demand that Foster pay at least half commission. D. Nothing, since the offer does not meet the terms of the listing contract.
D
Broker Jane is acting as a dual agent in a real estate transaction and decides to appoint salesperson Sara to represent the seller and salesperson Ben to represent the buyer. Ben and Sara both work in Jane's firm. A. Jane cannot legally do this. B. Ben and Sara are dual representatives. C. Ben and Sara must be independent contractors. D. Ben and Sara are designated representatives.
D
When does a broker earn his commission? A. When the listing is taken. B. When the title insurance policy is given to the purchaser. C. When closing is complete and title passes. D. When the offer to purchase has been signed and accepted by the seller.
D
When a broker accepts a listing he or she has created an agency relationship. Which of the following is not an agency responsibility? A. To obey all the instructions of the seller. B. To use care in filling out contract forms. C. To be accountable for documents and funds. D. To be loyal to the seller.
A
A broker who intends to be compensated if any other person sells his listed property during the listing period, should acquire: A. An exclusive right-to-sell listing. B. An open listing. C. An exclusive agency listing. D. A net listing.
A
In Fair Housing discrimination cases, the burden of proof is on the claimant. The claimant must be able to prove: A. That discrimination occurred. B. That the act of discrimination was not provoked by the claimant. C. Only that the accused partly intended to discriminate. D. Actual damages resulted from the acts of the accused.
A
In a revaluation lease, the rent is adjusted automatically according to the reappraisal of the real estate. A. True B. False
A
In the usual property management agreement, the property manager can do all of the following EXCEPT: A. Enter into a 2 year lease, verbally B. Hire and fire employees C. Collect rents every month D. Furnish the owner with a monthly statement of income and expenditures
A
Jones leases a building and an earthquake destroys it. Usually A. the lease is no longer enforceable. B. the tenant must pay rent when the building is rebuilt. C. the landlord must rebuild the building. D. the tenant may rebuild the building and the landlord will have to reimburse the tenant.
A
Larry Licensee shows a minority prospect homes only in neighborhoods which are predominantly populated by minorities. Larry has engaged in: A. Steering. B. Blockbusting. C. Redlining. D. Reverse redlining.
A
Under Common Law Agency, the listing agent should disclose material facts to the seller AND buyer. Which of the following would NOT be a material fact? A. Worn carpeting. B. Seasonal flooding in the basement. C. A foundation crack covered with paneling. D. A faulty heating system.
A
A broker brought a ready, willing and able minority buyer who signed an offer to buy a house at the listed price. Because of the buyer's race, the sellers refused the offer. The broker may legally take all of the following actions EXCEPT: A. Sue the seller for his commission B. Advise the prospect of his right to complain to the U.S. Department of Housing and Urban Development (HUD) C. Warn the sellers that their refusal is a violation of Fair Housing laws D. Market the house only to non-minority customers
D
Leases generally contain a quiet enjoyment clause. The meaning of this clause is that: A. The lessor (owner) will not disturb the lessee during the period of the lease. B. The lessee will not be evicted by a person having a superior title to the lessor. C. The tenant may quietly enjoy the property while he is in possession, provided his enjoyment does not violate the terms of the lease. D. All of these choices.
D