Real Estate Exam Arizona
What's the definition of a marketable title?
A title that is clear and free of encumbrances
Cindy enters into a contract to buy Jarod's home. She then transfers her right to purchase to her twin sister, Maud, for a small fee. But Maud neglects to fulfill the buyer's obligations under the contract, and Jarod is able to pursue Cindy, who's still liable. This is an example of ______.
Assignment
Which of the following involves the transfer of the lease contract from the current tenant to another person?
Assignment
Your client Jerry wants to buy some acreage to run a 10-acre ranch. He found the perfect spot—and it's inside an INA. What should you tell him?
"The only way you can irrigate here is if you buy land that was irrigated between 1975 and 1979."
A new homeowner asks you, "Why is there a charge on my water bill from CAGRD?" What should you say?
"This charge goes to help replenish the groundwater that you used. CAGRD is the authority that does this."
You've just shown a home in a newer Arizona subdivision in a trendy part of town to Randy and Connie. "Do you think the HOA would allow us to install some solar panels to help with utility costs?" Randy asks. What's the best way for you to respond? "Probably not. Most HOAs don't allow them." "Yes, HOAs can legally regulate placement or use of solar devices." "You'd have to check with HOA regulations for placement and other rules, but it can't legally prohibit them." "You'd have to check with the HOA. Sometimes they allow them, and sometimes they don't."
"You'd have to check with HOA regulations for placement and other rules, but it can't legally prohibit them."
The market value of your client's property is $280,000. Taxes in the area are assessed at 60% of market value. Your client's semi-annual tax bill was $1,461. What's the tax rate per 100?
$1.74
What is the current value of a property that was purchased two years ago for $260,000, assuming an annual appreciation rate of 2%?
$270,504
If the daily rate is $1.23 and closing is August 31, what will the seller owe at closing? Assume a statutory year and that the seller hasn't made any payments. Round to the nearest cent.
$295.20
A buyer is purchasing a property for $400,000. His lender's loan-to-value ratio is 80%. How much is the buyer financing?
$320,000
Giant Industries has a $674,232 gross operating income, operating expenses of $329,129, and other expenses totaling $38,719. What is the net operating income?
$345,103 (Gross - Op Exp = Net) (Not other exp)
You're working with a buyer who's purchasing a home that appraised at $80,000. The buyer is obtaining a 90% loan, and the lender will charge a one-point origination fee at closing. How much will the loan origination fee be?
$720
Alana and Michael want to build a 5,000-square-foot ranch home on two acres of land they just bought. Once the house is built, how many acres of land will remain unbuilt?
1.89 acres
Residential properties in Arizona have an assessment ratio of ______.
10%
Over how many years is a commercial property depreciated?
39 years
Each of four properties has an assessed valuation of $249,000. Based on property classification and assessment ratio, which one would have the highest property tax bill?
A bicycle manufacturing plant
Which of the following best describes a bilateral contract?
A contract that involves an exchange of consideration between two parties
The local planning and zoning commission is reviewing multiple applications at this week's meeting. Which of the following new developments is likely to be reviewed relative to a mixed-use zoning ordinance?
A high rise with residential, retail, and entertainment space
Which of these actions would NOT help a real estate licensee who wants to specialize in sales of distressed properties?
Become licensed as an auctioneer.
The ADEQ administers and enforces ______.
Both federal and state law
For each Arizona branch office that an employing broker opens, a separate ______ must be attained.
Branch office license
Under which of the following types of leases does a tenant rent property with an unfinished interior and agree to complete the construction?
Building shell lease
Becky's client asked, "Who contributes to the escrow account to maintain the proper funds for insurance payment?" How should she respond?
Buyer
When a judge rules on a matter, and precedent is set, which source of law can be used to modify or overturn other sources of law?
Case law
When the buyer and seller both have costs to pay, which form shows who pays what? Closing disclosure Home inspection report Loan Estimate Purchase contract
Closing disclosure
The residential contractors recovery fund has a maximum payout limited to $200,000 per ______.
Contractor license
California licensed real estate agent Darshna is representing her California buyer in his home search in Phoenix. Arizona broker Ted must have a ______ with Darshna in order for the two to work together in a transaction.
Cooperating Broker Agreement An Arizona broker must have a cooperation agreement in place with an out-of-state broker in order for the out-of-state broker to participate in a real estate transaction in Arizona.
You're holding an open house for Brenda. Walt and Mary walk in and ask you for a flyer that gives details about the property. Walt and Mary are now your ______.
Customers
Which factor influences property value and addresses questions such as, "What's the market like?" and "Are there more buyers than sellers, or vice versa?" Demand Scarcity Transferability Utility
Demand
Which one of the following actions is a licensee required to take to fulfill a fiduciary duty?
Disclose personal interest and licensed status when buying property for personal use.
Which of the following is NOT a type of real property lien? Disposition Judgment Mortgage Property tax
Disposition
Your client tells you to do something. It would violate fair housing laws, but it will earn you an amazing commission. What should you do?
Explain that you cannot do it, because it's a fair housing violation, and you could both get into trouble for doing what she's asked.
Cameron's lease just went up in April. That's no surprise; it goes up every April. What kind of lease is this?
Graduated
A property is 21,780 square feet. How many acres is this? Half an acre One acre Three acres Two acres
Half an acre
Jewel's buyer client recently bought a house, and Jewel can now be compensated for her work as an Arizona buyer's agent. From whom will Jewel receive her commission check?
Her employing broker
Obtaining a 20-year mortgage instead of a 30-year mortgage results in which of the following?
Higher payments and less interest
Arizona licensed contractor DeAngelo was involved in a case against a consumer and can't pay the judgment amount awarded by the residential contractors recovery fund. What will happen to his contractor's license?
His license will be suspended until he pays back the amount paid to the consumer, plus interest.
Why do investors have a special interest in the impact income taxes have?
Income tax is a significant factor in return on investment.
How do agents commonly market an office exclusive? Inform colleagues at their firm about the listing Market the listing on the MLS Place ads in local newspapers Place advertisements on social media
Inform colleagues at their firm about the listing
Which of the following best describes the function of a deficiency judgment in the case of a foreclosure?
It allows the lender to recover losses incurred in the foreclosure process.
What purpose does the promissory note serve?
It's a promise the buyer makes to the lender that the note will be repaid in full.
What is ADWR's responsibility regarding wetlands? It doesn't have any responsibility for the state's wetlands. It is actively trying to rid Arizona of its wetlands, since this land doesn't contribute to water conservation efforts. It is in charge of conserving what small amounts of wetlands are left in Arizona. It's involved in protecting the remaining wetlands, and is also working to restore former wetlands.
It's involved in protecting the remaining wetlands, and is also working to restore former wetlands.
Steven owns 114 acres of wooded, rural land. The abundance of wildlife on his property means that his friends are always asking for permission to hunt on it during various game seasons. If Steven gives a friend permission to hunt on his land, it can be said that he has given his friend a ______.• Easement• Grant• Covenant• License
License
Putting clients' interests ahead of all others describes which fiduciary duty?
Loyalty
Maggie has a neighbor, Jim, who is facing foreclosure. She likes Jim and wants to help him out, so they agree to do a "subject to" purchase. What does this mean?
Maggie will take over Jim's loan payments without telling his lender she's doing so.
What steps must a lien-holder take to perfect their mechanic's lien in Arizona?
Make copies of the lien claim, give one to the county recorder, give the other to the building's owner
Life insurance companies participate in real estate in the ______ arena. Construction loan Home equity line of credit (HELOC) Mortgage blocks from secondary mortgage market New home construction
Mortgage blocks from secondary mortgage market
Jessica's license expired two months ago, and she is working to complete her continuing education requirements while she juggles working with her clients on behalf of her employing broker. Is Jessica working within Arizona's standards of conduct for real estate licensees?
No, her license expired, and she cannot engage in real estate activities without an active license.
Sean and Sherry, an unmarried couple, have three young children. Because of the children, a landlord refuses to show them an apartment in a complex with mostly retired couples that isn't officially designated as senior housing. Is this legal?
No, it is an example of illegal discrimination against families with children.
If a change must be made to un-subdivided land after a public report has been issued, what must the owner do? Changes are not allowed once a public report has been issued. Complete a new public report application. Nothing. Notify the commissioner.
Notify the commissioner.
______ is an acronym that can help you remember an agent's fiduciary duties.
OLD CAR
Which of the following is true about volatile organic compounds?
Paint, air fresheners, and cleaners are primary sources.
The Barbers are looking to purchase a new home for their family of four, but they'll need to be approved for a loan. What document will they need to complete to initiate their loan process? Closing Disclosure Loan application Loan Estimate Pre-qualification request
Pre-qualification request
A property management agreement is between a property manager and a ______.
Property owner
What's a typical prepaid item that goes into a seller's credit column and a buyer's debit column on a closing statement? Broker fees Loan fees Property taxes Recording fees
Property taxes
Which of these fits the description of the abandonment remedy?
Rats drove Willard out of his apartment.
For farmers and others who live in rural communities, a ______ loan may be available. One benefit of these loans is the option for a longer payback period.
Rural development
Dan's lease agreement contains a clause that says he'll receive specific services for an additional rental fee. What type of clause is this? Assignment Escalation Estoppel Services included
Services included
Sima purchased a cooperative. When the sale goes through, what will she own?
Shares in a corporation
Evan bought into a housing cooperative that's focused on cultural exchange. Each month, the co-op residents have dinner meetings and share food and information about the culture of their respective regions. When Evan made his purchase, he received a proprietary lease for his unit. What else did he receive?
Shares in the cooperative corporation
Elisa agreed to list Simone's house for sale. After the listing contract was signed, Simone lost her job, and her father, George, offered to help Simone by paying Elisa's listing commission. The buyer's agent, Carl, also reduced his commission. Who is Elisa's client?
Simone
Which of the following types of residential dwellings do life insurance companies purchase from the secondary mortgage market? Blocks of condo units Commercial properties Single-family on one lot Undeveloped land
Single-family on one lot
What are the minimum requirements for a bulk sale of subdivided to be exempt from Arizona subdivision statutes?
Six or more lots sold to a single buyer in one transaction.
Which one of the following definitions best describes a consumer? Someone who is hired to act on behalf of a client Someone who is in a position of trust and loyalty Someone who is involved in a transaction but represents neither party Someone who uses or purchases a product or service
Someone who uses or purchases a product or service
What's the term for the illegal practice of nudging buyers away from or toward a specific area based on the presence or absence of protected class members?
Steering
Jonathon is setting up a lottery to promote his timeshares. What must he do first before moving forward with his promotion?
Submit an exception request to the Department of Real Estate.
Trinity has applied for a home equity line of credit to perform some upgrades on her home. Within what timeframe must her lender provide the Closing Disclosure?
The Closing Disclosure isn't required for a HELOC.
When the listing agreement's purpose has been fulfilled, what happens to the agency agreement?
The agency agreement terminates by completion.
Who is required to sign a security agreement for security arrangements under the Uniform Commercial Code?
The borrower
Which of the following isn't required to be filed with the Arizona Department of Real Estate as part of the timeshare public report application?
The business organizational chart and proof of business operation for at least one year
Callie's home is damaged during a severe summer storm. Thank goodness she has property insurance with Safe Home and Life. In this situation, Safe Home and Life is known as ______.
The insurer
Which of the following bits of data is crucial in a proration? The current date The number of days in the proration period The type of expense for which the proration is charged Who the prorator is
The number of days in the proration period
How is the grid that's used in the rectangular survey system laid out?
The numbers start in the northeastern corner and follow a zigzag pattern.
Assuming no qualifying exceptions, who is responsible for handling real estate transaction negotiations in Arizona?
The principals' brokers or their brokers' representatives
You're measuring the square footage of a single-family home you've just built. What national requirements apply to your measurements? There are no national requirements. You must measure from the inside out. You must measure from the outside in. You must measure from the top down.
There are no national requirements.
Clarence is a Gilbert broker who's performing a three-step reconciliation. He's compared the bank statement balance—adjusting for any outstanding checks or receipts—to the balance on his receipts and disbursements journal for the same date. How should these numbers compare?
They should match.
What is the minimum number of estimates that buyers and sellers should get from contractors for work they want done on their home? None One Three Two
Three
Arizona licensed salesperson Andrea has an active license, but in order to perform real estate activities to earn compensation, she'll also need ______.
To be employed by an employing broker
When pricing a property, which of the following is a reason a licensee would consider expired listings?
To determine the price at which a property won't sell
How are sections and townships related to one another, relative to the rectangular government survey system?
Townships are divided into sections.
Moneys given for purchase deposits are ______.
Trust funds
A lot measuring 108,900 square feet is for sale. How many acres is this? Five One Three Two-and-a-half
Two-and-a-half
Which physical characteristic of land addresses the concept that land isn't interchangeable, and one piece of land isn't exactly like another?
Uniqueness
Xavier deposited a $3,000 earnest money check into his personal account for safekeeping while he was on vacation. The balance in his account when he left on vacation was $4,200, and when he returned, it was $2,800. He withdrew enough funds from his savings account to cover the earnest money check and delivered the funds to the escrow agent. Which statement best represents Xavier's issue?
Xavier is guilty of commingling and conversion.
If an Arizona salesperson's license expires, can she still collect compensation?
Yes, as long as the compensation were earned legitimately while her license was active, it can be collected after the license expires.
An illegal practice in which licensees or others encourage homeowners to sell because of an influx or expected influx of minorities into the area
blockbusting
Which of the following would require a licensee to notify the Arizona Department of Real Estate?
Adverse judgment involving fraud
Homeowner Ron can no longer make his mortgage payments. Rather than face foreclosure, he decides to cut his losses. He voluntarily conveys his property to his lender. What type of foreclosure alternative is this?
Deed in lieu of foreclosure
Max has decided to cancel his reservation for a plot in an upcoming subdivision because of the delays the subdivider is experiencing. How long does the subdivider have to get the deposit back to Max?
Five business days
Which of the following are included in the transfer of real property unless specifically excluded in writing?
Fixtures
Cooperative shareholders under a condop structure have ______.
Flexibility in selling and subletting, similar to that of condominium owners
What should an agent do if a seller client requests an office exclusive? Advertise the listing on the MLS Fully inform the seller about the dangers of reduced market exposure Negotiate a higher commission, as there is a greater burden on the agent to find a buyer Prepare advertising for social media and local newspapers
Fully inform the seller about the dangers of reduced market exposure
Sonia receives a Notice of Trustee's Sale from one of the parties on her deed of trust. Who's responsible for sending her this notice?
The trustee
Assuming licensee Shannon has actual knowledge of all of the following property issues, which of these issues should she disclose to prospective buyers?
The upstairs bathroom has a leaky toilet.
What's a percent?
part of 100
Chattel is another word for _______.
personal property
The practice of a lender to refuse to lend in a specific area, often based on the minority makeup of the area.
redlining
When conducting an appraisal of lease value, how does the appraiser divide the appraised value?
t's divided according to the parties' interests as attributed in the lease.
