The CE Shop Real Estate - Contracts and Regulations Section

A buyer is planning to take over the sellers' existing mortgage and payments. Which of the following sections of the Colorado Contract to Buy and Sell Real Estate (Residential) must be completed, based on this? "Assumption" "New Loan" "Private Financing" "Seller Financing"

"Assumption"

Which of the following sections of the CBS residential reminds the parties that different settlement providers offer various services, costs, and levels of quality? "Closing Instructions" "Disclosure of Settlement Costs" "Off-Record Title" "Transfer of Title"

"Disclosure of Settlement Costs"

Buyer Michael is taking out a VA loan to pay for the home he's buying in Colorado Springs. In the Colorado Contract to Buy and Sell Real Estate (Residential), this would be indicated in which of the following sections? "Assumption" "New Loan" "Private Financing" "Seller Financing"

"New Loan"

José and his wife, Gracie, are purchasing a home with an FHA loan. Which part of the Colorado Contract to Buy and Sell Real Estate (Residential) must be completed to reflect this? "Assumption" "New Loan" "Private Financing" "Seller Financing"

"New Loan"

6 Fiduciary Duties

"OLD CAR": obedience, loyalty, disclosure, confidentiality, accountability, reasonable skill and care

When you're completing the Exclusive Right-to-Buy Listing Contract with the buyers you work with, which of these statements will you make to the consumer? "Brokers are required to use standard forms in this state, which makes it unnecessary for you to consult with an attorney before entering into this contract." "This contract has been developed by an attorney for all Colorado brokers to use, but you may have your own attorney develop a different form if you so desire." "This is a binding contract with important legal consequences, so you should consult legal counsel before you sign it." "You're required to have an attorney review this form before you sign it. If you choose not to, the contract is considered voidable."

"This is a binding contract with important legal consequences, so you should consult legal counsel before you sign it."

Trish is filling in the blanks on the Exclusive Right-to-Sell form to establish an agency relationship with seller Deanna. Deanna's a bit overwhelmed by the multiple pages of tiny print, and asks, "Can't we just do something simpler? Why does it have to be so complicated?" What's the best response for Trish to give her? "I can ask my employing broker to give us a shorter version of this form. As long as it comes from her, it will be okay. Whatever I can do to make this process easier for you!" "If you prefer, we can make our agreement oral. It's still legal that way under Colorado law." "It is really long, but my employing broker requires it in the office policy manual. If it was up to me, we'd use something far simpler!" "This is a standard form we're required to use, and that's to protect you. It's long because it was written to limit the potential for any misunderstandings between us."

"This is a standard form we're required to use, and that's to protect you. It's long because it was written to limit the potential for any misunderstandings between us."

You're representing Edna, a widow whose home is facing foreclosure and who is being forced to sell. You receive an extremely low offer from an investor, but of course you present it to Edna. The investor's agent has used the CBS (Colorado Foreclosure Protection Act) form and has also attached the Homeowner Warning Notice. How do you explain the purpose of the notice to Edna? "The notice is a warning to you that, if you don't agree to the purchase terms, you'll lose your home in the foreclosure sale. It explains the value of a homeowner in your position selling to an equity purchaser, even if the price is low." "This is a notice for sellers who don't speak English as their first language. Since you do, we can ignore this form." "This notice is designed to protect sellers in your position, who may be persuaded to agree to a contract that's not in their best interests. It ensures that sellers fully understand their right to cancel by putting the notice in their primary language" "This notice warns you that you have three days in which to respond to the buyer's offer, or the foreclosure sale will go forward and you'll have to accept whatever price the property sells for at auction."

"This notice is designed to protect sellers in your position, who may be persuaded to agree to a contract that's not in their best interests. It ensures that sellers fully understand their right to cancel by putting the notice in their primary language"

Which of these choices is an acceptable deadline to write into one of the rows of the table in Section 3, Dates and Deadlines, of the Colorado commercial sales contract? "On demand" "Per buyer and seller agreement' "Within 3 days" "Within 3 days of MEC"

"Within 3 days of MEC"

You're completing Section 3, Dates and Deadlines, of the Colorado commercial sales contract. Other than specifying an exact date, which of these exemplifies an acceptable way to specify a deadline in the table? "Prior to closing date" "Prior to due diligence completion" "Upon request" "Within 3 days of MEC"

"Within 3 days of MEC"

A friend of yours, Richie, approaches you and says, "You know all about real estate now, don't you? My wife and I applied for a rental unit last week, and I think we were rejected because we're a mixed-race couple. What do you think we should do about it?" How do you respond? "Did you contact the police? I'm pretty sure they can arrest the owner or the property manager for discrimination." "Don't worry about it. Some people are just jerks. I'll help you and your wife find a great apartment." "You should contact the Colorado Real Estate Commission and make a complaint against the property owner." "You should make a complaint of discrimination against the owner or the person who treated you that way. File it with the Colorado Civil Rights Division."

"You should make a complaint of discrimination against the owner or the person who treated you that way. File it with the Colorado Civil Rights Division."

Licensees should obtain no less than how much errors and omissions coverage per claim? $100,000 $25,000 $50,000 $75,000

$100,000

A buyer breaches the Contract to Buy and Sell and forfeits the earnest money. In the absence of an agreement in the listing agreement regarding the earnest money, how will it be disbursed? 100% disbursed to the broker 100% disbursed to the seller 50% disbursed to the buyer's broker and 50% to the seller's broker 50% disbursed to the listing broker and 50% to the seller

100% disbursed to the seller The agreement allows the seller to agree to have the broker receive 50%, but in the absence of such agreement 100% goes to the seller.

Under Section _______ of the Internal Revenue Code, an investor in real property can sell that property, reinvest the proceeds in a "like-kind" property, and defer paying capital gains taxes. 1031 1040 180 360

1031

In a Colorado CBS residential contract, a "day" is said to end at __________. 11:59 p.m., Mountain Time 9:00 p.m., Mountain Time Midnight, Eastern Time Midnight, Mountain Time

11:59 p.m., Mountain Time

For which one of the following properties would you use the Colorado Contract to Buy and Sell Real Estate (Land)? 160 acres of unimproved property, zoned agricultural An 18-hole golf course A single-family residence on one acre in a subdivision Three acres to be developed as a medical office complex

160 acres of unimproved property, zoned agricultural

What's the minimum age to be licensed as a real estate broker in Colorado? 15 18 21 25

18

Hiram plans to do a 1031 tax-deferred exchange. He just sold his property. How many days does he have to close on a new property? 180 30 45 60

180

Samuel wants to do a 1031 exchange. He sold his investment property and has identified the property he'd like to buy next. Within how many days must he close on this property in order for it to qualify as part of the exchange? 180 30 45 60

180

How long does someone who wants to do a tax-deferred exchange have to close on a replacement property?

180 days

When did Colorado add sexual orientation as a protected class?

2008

Melissa is studying her options for completing continuing education so she can renew her license at the end of the three-year cycle. She's torn between the option to get credit hours and the option to just pass the state portion of the exam (she loves taking tests). Finally, she decides to go for the commission's recommended choice. How many hours of CE will she need to complete? 12 24 48 72

24

How long does someone who wants to do a tax-deferred exchange have to identify a replacement property?

45 days

Which of these properties that would use the Colorado land sales contract would be least likely to require Section 10.6, Due Diligence? 640 acres of vacant land in an area zoned for agriculture A 1,000-acre working cattle ranch A 15-acre organic farm A 200-acre property with a boarding business and haying operation

640 acres of vacant land in an area zoned for agriculture

What does Colorado statute require to be made part of any sales contract involving property that's part of a common interest community? A bill of sale from the association to release the common area to the individual A bold-faced type disclosure An aerial view of the property and its surrounding area A waiver of the seller's community ownership rights

A bold-faced type disclosure C.R.S. § 38-35.7-102 requires sellers of property that's part of a common interest community to include a bold-faced typed disclosure in the sales contract, and to make certain disclosures in the Seller's Property Disclosure form.

Wallace is beside himself. He spent the last five months raising enough money to purchase the property that he has an option on, and now, a month before the end of his option period, the seller refuses to sell him the property. The seller's actions are ______. A breach of contract Justified because the option period is nearly at an end Not very nice, but legal Within his rights as the owner of the property

A breach of contract

What is a transaction-broker?

A broker who facilitates a transaction without acting as an agent

Which of the following can indicate an electrical problem? A broken light bulb A burned or discolored outlet An outlet that only works when the switch is turned on A switch that's cool to the touch

A burned or discolored outlet

When a buyer has been pre-approved, which of the following is true? A change in finances may prevent him from obtaining a loan. A change in finances will not prevent him from obtaining a loan. His loan is guaranteed. The interest rate is locked in.

A change in finances may prevent him from obtaining a loan.

Celeste and Conrad have been pre-approved for a mortgage. Which of the following is true? A change in finances may prevent them from obtaining a loan. A change in finances will not prevent them from obtaining a loan. The interest rate is locked in. Their loan is guaranteed.

A change in finances may prevent them from obtaining a loan.

What's the "good faith" clause in the Colorado contracts to buy and sell? A confirmation and acknowledgement of each party's responsibility to perform all obligations described in the contract to the best of their ability and with the intention of behaving honestly. A list of the contract clauses that requires each party to confirm by putting initials under "yes" for each clause. A recognition that all forms of contract delivery have a risk of failure and that no party to the contract will file suit against another as a result of a delivery initiated but not completed. To affirm the broker's continued responsibility to complete the actions identified in the employment contract with the buyer or seller.

A confirmation and acknowledgement of each party's responsibility to perform all obligations described in the contract to the best of their ability and with the intention of behaving honestly.

Which of the following is considered an unearned fee? A fee for actual work done A fee for nominal or duplicative work A fee for work done set at a flat dollar amount Any fee paid to a federally backed institution

A fee for nominal or duplicative work

Which of the following can indicate issues with heating and cooling? A furnace or air conditioning unit that does not kick on when the temperature is adjusted Consistent temperatures throughout the home Moisture in the basement Windows that won't open or close

A furnace or air conditioning unit that does not kick on when the temperature is adjusted

Loans on unimproved land usually have a higher interest rate. What else is true? A larger down payment is usually required. They are easier to obtain. They are made for shorter periods of time. They involve less risk.

A larger down payment is usually required.

What's the difference between laws and regulations?

A law (aka a statute) begins as legislation proposed by and voted into effect by a state legislature, while a regulation is a standard or rule adopted by a government agency, such as a state department of commerce or a state real estate commission.

A power of attorney is __________________. A legal document A person named as a temporary attorney who doesn't need to be licensed by the state A real estate attorney The seller of real property

A legal document

Method for obtaining a reciprocal license

A licensed individual in another state may apply for a Colorado license, and fewer requirements may apply than would be required for an unlicensed individual.

Who may perform an ILC or survey? A licensed appraiser A licensed surveyor A real estate broker A title company representative

A licensed surveyor

Which of these relationships would be illegal in Colorado? A licensee acting as a single agent for one party to a transaction and as a transaction-broker to the other party in the same transaction A licensee acting as a transaction-broker for both parties to a transaction A licensee representing a seller as a seller's agent in one transaction and a buyer as a buyer's agent in a separate transaction A licensee representing one party in one transaction and the same party in a different transaction

A licensee acting as a single agent for one party to a transaction and as a transaction-broker to the other party in the same transaction

In Colorado, what's the effect of a special district tax on property owners within the district? A lien is placed against their property and remains in place until it's repaid. Property owners must increase their homeowners' insurance. The property owners can't take advantage of the additional services until they pay the tax. The special district tax reduces their property taxes.

A lien is placed against their property and remains in place until it's repaid.

The Listing Contract Amend-Extend is intended to amend which type of contract? A counter-offer A foreclosure contract A listing contract A sales contract

A listing contract The Listing Contract Amend-Extend amends a listing contract or a buyer/tenant representation agreement.

Which of the following statements about material facts is true? All material facts are related to physical conditions. All parties considering a property would regard each material fact in the same way. A material fact may have more or less effect on a buyer based on the buyer's needs and values. Material facts are only those that can be easily seen or discovered.

A material fact may have more or less effect on a buyer based on the buyer's needs and values.

An amendment to a contract is defined as which of the following? A modification An addition A new contract A provision

A modification An amendment is defined as a modification or change to the existing content of a sales contract.

For which of these properties should the Colorado commercial sales contract mark Section 10.6.1.7, which asks for delivery of all current leases pertaining to the property? A duplex that has been used as a rental property in the past, but is currently vacant An empty warehouse for an owner-investor that has contracts with a fuel supplier to keep two underground tanks full. An industrial park with vacant lots available for construction A partially occupied office building with space for six tenants that's being purchased for investment purposes

A partially occupied office building with space for six tenants that's being purchased for investment purposes

Which of the following defines a developer under the Subdivision Developer's Act? A city or county that permits the development of a subdivision A person or partnership promoting the sale of a subdivision A person responsible for listing and marketing condominiums A real estate licensee promoting the sale of a subdivision

A person or partnership promoting the sale of a subdivision

Which of these people is exempt from the Subdivision Developer's Act and not required to be registered with the Colorado Real Estate Commission? A Colorado developer whose business is in Colorado, and who's selling property in Texas A developer selling interests in a converted property with 23 lofts A developer selling stock certificates as proprietary leases in a housing cooperative with 40 units A public official performing official duties of the office and selling 25 units in a condominium property

A public official performing official duties of the office and selling 25 units in a condominium property

Under a Colorado deed of trust, who holds legal title to the property until the loan is paid in full? An attorney A public trustee The Hawkins The lender

A public trustee

What type of professional must an investor use to conduct a tax-deferred exchange? A certified public accountant A licensed real estate professional An appraiser or real estate broker A qualified intermediary

A qualified intermediary

Harvey is an investor who found and closed on an investment property, then decided to sell a property other than the one originally marked for the exchange. What is this an example of? A buy and hold A fickle investor A fix and flip A reverse tax-deferred exchange

A reverse tax-deferred exchange

If an appraisal is lower than the agreed-upon sales price, what steps can the seller take? A second appraisal can be ordered, although there should be good reason to question the first appraisal. A second appraisal can be ordered, but it's always the buyer's expense. A second appraisal can be ordered, but the seller must pay for it. A second appraisal can be ordered, which typically turns out to be higher.

A second appraisal can be ordered, although there should be good reason to question the first appraisal.

Jennifer is selling her property and hired Larry as her agent. Jane brings her client, Andrew, a prospective buyer, to see Jennifer's property. What is Larry's role in this scenario? A buyer's agent A dual agent A seller's agent A sub-agent

A seller's agent

Which of the following may be used to verify, clarify, correct, or create the legal description for a property? An appraisal An inspection A spot survey A survey

A survey

Which of the following must appear in a Colorado Exclusive Right-to-Buy Listing Contract? Additional provisions A termination date for the agreement The addresses of specific properties the buyer is interested in The buyer's agreement to extend deadlines that fall on Saturday, Sunday, or holidays

A termination date for the agreement

Parol evidence rule's overarching principle

A written agreement is the final and comprehensive expression of the parties' agreement; introducing earlier verbal or written statements that vary, contradict, augment, or otherwise change the written contract's terms is prohibited.

Which of the following is used to establish the broker/buyer-tenant relationship in Colorado? A face-to-face meeting between the broker and the buyer-tenant A signed Definitions of Working Relationships form A verbal agreement between the broker and the buyer-tenant A written and signed buyer-tenant contract

A written and signed buyer-tenant contract

Express authority exists when _______. Authority is assumed A written or oral agreement is in place The parties act as if they are in an agency relationship The parties are in a hurry

A written or oral agreement is in place

Examples of due diligence documents

ADA evaluation, rent roll, operating statements, environmental inspections, current leases

What type of land survey provides the greatest level of detail and is commonly ordered in commercial property transactions? ALTA/ACSM Boundary ILC Improvement

ALTA/ACSM

Water has been placed for a beneficial use, and the user has an unconditional right to it.

Absolute water right

What's a key difference between a contract addendum form and an amendment form? Addenda supplement the contract information and are attached prior to contract execution. Contract addenda are attached after a contract is executed to modify the terms of the original contract. Contract addenda are mandatory, while amendments are not. Contract addenda don't require the parties' signatures.

Addenda supplement the contract information and are attached prior to contract execution.

A document that expands on the terms within a sales contract and is attached to the sales contract at the time of its execution

Addendum

You're helping your client with a transaction involving a 1031 tax-deferred exchange. What section of the Contract to Buy and Sell Real Estate (Residential - Income) must be completed if the Exchange Addendum isn't being used? Additional Provisions Exchange Provisions Investment Disclosure Parties

Additional Provisions

Three additional duties that single agents, but not transaction-brokers, owe their clients

Additional duties

Which of the following statements about brokerage duties and the Colorado exclusive buyer and tenant contracts is true? Additional duties are performed by the buyer's or tenant's agent only. Additional duties are performed by the transaction-broker only. Uniform duties are performed by the buyer's or tenant's agent only. Uniform duties are performed by the transaction-broker only.

Additional duties are performed by the buyer's or tenant's agent only.

A fact that would cause a reasonable buyer concern (about whether to purchase, what price to pay for the home, or what terms to offer)

Adverse material fact

Which of these is NOT a recommended practice related to seller property disclosures? Advise buyers to request seller disclosures in lieu of paying for a property inspection. If you're aware of a material defect, disclose it to prospective buyers. Keep records about the information you provide to your clients regarding disclosure obligations. Suggest clients seek professional legal counsel if they're uncertain about their disclosure responsibilities.

Advise buyers to request seller disclosures in lieu of paying for a property inspection.

Which of these items falls outside the duties of a transaction-broker? Advise the consumer when to seek expert advice Advocate for the consumer's best interests Assist with communications Assist with negotiations

Advocate for the consumer's best interests

Why might a Colorado homeowner agree to participate in a conservation program for their land? Aesthetic and environmental reasons Government grants They're facing foreclosure Use of herbicides

Aesthetic and environmental reasons

What information about a roof must a seller disclose in their Colorado Seller's Property Disclosure form? Age, color, roofing material type Age, material, evidence of leaks or moisture damage, warranties, skylight issues Color, roofing material type, existence of fire retardant treated plywood Evidence of leaks or moisture damage, roofing material type, color

Age, material, evidence of leaks or moisture damage, warranties, skylight issues

A relationship in which a principal/client authorizes a broker to act on the principal's behalf in certain areas

Agency

One who represents another

Agent

Someone who acts on behalf of someone else, at that other person's request

Agent

A CREC form that, when signed, extends contracted deadlines

Agreement to Amend/Extend

A CREC-approved form that allows the parties to amend deadlines specified within the sales contract

Agreement to Amend/Extend Contract

Which of the following forms is used to change deadlines established in the original Colorado residential sales contract? Agreement to Amend/Extend Contract Agreement to Amend/Extend Contract with Broker Change of Status Notice to Terminate

Agreement to Amend/Extend Contract

Which document is used to extend the termination date of listing contracts in Colorado? Agreement to Amend/Extend Contract Agreement to Amend/Extend Contract with Broker Post-Closing Occupancy Agreement Residential Addendum

Agreement to Amend/Extend Contract with Broker The Agreement to Amend/Extend Contract with Broker is the form used to amend or extend the termination date in a listing contract.

Used to make an amendment to the original terms of an executed contract; once signed by both parties, it becomes part of the original contract

Agreement to Amend/Extend Contract with Broker form

Albert's licensed as a mortgage broker and as a real estate broker in Colorado. If he will be acting as both real estate broker and mortgage broker in the same transaction, which of the following statements is true? Albert must obtain the lender's consent to act in a dual capacity in the transaction. Albert must use the dual status disclosure to obtain the buyer/borrower's consent to act in a dual capacity in the transaction. Albert will be breaking the law. When signing a Right to Buy listing agreement with Albert, the buyer/borrower automatically gives consent to use his services to obtain the mortgage loan.

Albert must use the dual status disclosure to obtain the buyer/borrower's consent to act in a dual capacity in the transaction.

Marge is a licensee in a dual agency transaction with seller Steven and buyer Alda. In which of the following situations can Marge share what she knows with all parties without compromising her duty of loyalty? Alda tells Marge she wants to make an offer on Steven's property and asks Marge what she should offer, since Marge knows Steven's rock-bottom price. Alda tells Marge that she's hired an inspector to perform a property inspection. During the home inspection, Marge hears the buyer tell the inspector several times, "That's no big deal. I can fix that." The buyer lists those as repairs she wants the seller to make. Steven tells Marge he can reduce his price, and Alda tells Marge she can increase her offer.

Alda tells Marge that she's hired an inspector to perform a property inspection.

How does the Colorado Contract to Buy and Sell Real Estate Residential address special taxing districts? Alerts the buyer to the fact that there may be a local government entity that can assess taxes that the buyer should be aware of. Discloses that it is a federal tax levied on properties that are located in environmental areas. States that the seller and the buyer must split any special assessment taxes due at the time of closing. States that this is a tax the buyer be responsible for at closing if the seller has disclosed material defects on the property disclosure form.

Alerts the buyer to the fact that there may be a local government entity that can assess taxes that the buyer should be aware of.

Who must sign the Colorado Agreement to Amend/Extend Contract for the proposed changes to be made? All parties to the existing contract The buyer The person to whom the changes are proposed The seller

All parties to the existing contract

The uniform brokerage duties documented in the Exclusive Right-to-Sell Listing Contract are duties which should be performed for _________. All sellers, including customers and clients Buyer customers only Cooperating agents Seller clients only

All sellers, including customers and clients

When a real estate broker serves as a leasing agent for a landlord or property owner, the broker must abide by ________. All instructions of the landlord, even when unlawful All state license laws Career advice provided by the local real estate association Neighboring state laws

All state license laws

Who must perform uniform duties: a transactional broker, a buyer's agent, or a tenant's agent?

All three

When making a land purchase, buyers should determine the existing well's ________ to ensure that it will meet their needs. Age Allowed use Bore size Depth

Allowed use

What's the purpose of the Green Disclosure form in Colorado? Allows the seller, and the seller's agent, to market the property as a green property Discloses that the property has been ENERGY STAR certified Discloses the presence of a green belt adjacent to the property Identifies the presence or absence of wetlands or endangered animals within a specified proximity of the property

Allows the seller, and the seller's agent, to market the property as a green property

A document that changes the terms of the original sales contract after the contract has been executed

Amendment

Strengthened the 1988 amendments regarding disabilities

Americans with Disabilities Act of 1990

How often must subdivisions covered by the Colorado Subdivision Developer's Act be registered?

An act that provides guidelines for the efficient and effective governance of homeowners' associations (HOAs), and gives HOAs the right to lien the property of unit owners for nonpayment of dues and assessments

What is the CCIOA? An acronym for a Colorado condemned property involved in drug manufacture, usually methamphetamine production An act that regulates the operation of common interest community associations An act to regulate the disclosure of common interest community property to buyers A trade union for homeowners associations

An act that regulates the operation of common interest community associations The CCIOA is the Colorado Community Interest Ownership Act that serves to establish an operational framework for community associations and their owners.

Serious complaints about a licensee to the commission may be referred to a hearing presided over by __________

An administrative law judge

Which of the following best describes a general agent? An agent acting as facilitator to a party An agent unrelated to the real estate transaction An agent with limited authority to act on behalf of a client An agent with the broad responsibility to handle all details related to a specific piece of property

An agent with the broad responsibility to handle all details related to a specific piece of property

What's meant by "like-kind" in a tax-deferred exchange?

An investment property where proceeds of a relinquished investment property are used to purchase a replacement investment property

Which of the following statements best describes the three-property rule as it relates to tax-deferred exchanges? An investor can exchange no more than three properties per exchange. An investor can exchange no more than three properties per year. An investor can identify up to three replacement properties and not encounter a restriction as to fair market value as long as debt load requirement is met. An investor must own at least three properties to qualify for a tax-deferred exchange.

An investor can identify up to three replacement properties and not encounter a restriction as to fair market value as long as debt load requirement is met.

Which of the following is an example of a reverse exchange? A homeowner finds and closes on a house and then decides to sell their existing home. A homeowner sells a property and then finds and closes on a new property. An investor finds and closes on an investment property and then decides to immediately sell another investment property. An investor sells a property and then finds and closes on another investment property.

An investor finds and closes on an investment property and then decides to immediately sell another investment property.

Which of the following is a true statement about options and option fees? An option fee may be for any amount agreed to by the parties. Neither party is obligated to perform with an option. Once the option fee is paid, both parties are obligated to exercise the option. The option is a bilateral contract.

An option fee may be for any amount agreed to by the parties.

According to Section 9 of the Colorado land sales contract, what alternative document may qualify as a new ILC or survey? A full warranty deed A limited warranty deed An attorney's waiver An updated existing ILC or survey

An updated existing ILC or survey

Sanjeev leases a house from Clara, and the lease has an option contract attached that permits Sanjeev to buy the house if he chooses to exercise the option within three years. How large does the option fee need to be in order to be legally binding? 10% of the purchase price 1% of the purchase price Any amount agreed to by the parties At least $1,000

Any amount agreed to by the parties

What items are generally sold with the property? Any built-in components Potted plants Sofas TVs

Any built-in components

Section 11 of the Colorado commercial sales contract describes the buyer's right to review tenant estoppel statements. For which of these properties is this section of the contract most necessary? Any commercial property Any property where the buyer intends to cancel existing leases Any property where the existing tenants will remain after closing Any residential property

Any property where the existing tenants will remain after closing

Exists when someone's words or actions might lead a reasonable person to believe that person is acting as an agent; shouldn't be an issue in Colorado as agency relationships can only be created via written express

Apparent authority

Which item could be ENERGY STAR®-certified? Appliances Concrete driveway Landscaping Property grading

Appliances

An opinion of value prepared by a licensed or certified appraiser

Appraisal

In Colorado, if your property taxes for the year are less than $25, when is your payment due? April 30 August 1 February 15 June 15

April 30

Vincent represents Donnie as a seller's agent. Kevin would like to purchase Donnie's home and have Vincent represent him. In what capacity can Vincent work with Kevin in this transaction? As Donnie's agent, Vincent must treat Kevin as a customer. Vincent can act as a buyer's agent or a transaction-broker for Kevin in this transaction. Vincent can act as Kevin's buyer's agent as well as Donnie's seller's agent. Vincent can only act as a transaction-broker to Kevin while representing seller Donnie.

As Donnie's agent, Vincent must treat Kevin as a customer.

In what way or ways do consumers compensate brokers for their services? As a fee for service only As a flat fee, fee for service, and/or percentage of sale As a flat fee only As a percentage of the sales price only

As a flat fee, fee for service, and/or percentage of sale

A fibrous incombustible mineral known to cause fibrosis and scarring in the lungs; also a known carcinogenic material (e.g., lung cancer)

Asbestos

The fibers of what material are dangerous when inhaled because they can lodge in the lungs and intestines, causing cancer? Asbestos Lead paint Radon Silicone

Asbestos

Which of the following would a home inspector note as a defect in a report, due to its link to lung cancer? Asbestos tiles in a basement Cedar shake siding Copper water pipes Old linoleum tiles in a kitchen

Asbestos tiles in a basement

What are the four Colorado cities that have made age discrimination illegal?

Aspen, Crested Butte, Denver, and Telluride

A licensee with fewer than two years of experience with a salesperson's license in another state would only be eligible for which Colorado license level? Associate broker Corporate broker Employing broker Independent broker

Associate broker

Buyer takes over and pays the seller's existing loan

Assumption

When must the buyer and seller pay their respective closing costs on a transaction in Colorado? 24 hours before closing At closing At least three business days before closing Within 24 hours after closing

At closing

Requirements a licensee must fulfill to obtain an employing broker level license

At least two years of experience as a broker and proven supervisory experience in the relevant area of expertise

What's the appropriate way to use an addendum? Attach to a contract after execution Attach to a contract prior to execution Execute the addendum form at closing Execute the addendum form at the same time as the amendment form

Attach to a contract prior to execution

At any multiple-person brokerage where you work, the employing broker has certain CREC-mandated responsibilities. Which of these is NOT a responsibility of the employing broker? Attend closings for all transactions represented by a broker of the firm. Maintain all transaction records. Provide a reasonable level of supervision for experienced licensees. Provide a reasonable level of supervision to all offices the broker operates.

Attend closings for all transactions represented by a broker of the firm.

Junior appropriators may use this as a means to obtain water through water courts.

Augmentation plan

When you are completing Section 2.5.1, Inclusions, of the Colorado Contract to Buy and Sell Real Estate (Land), what is the most important guideline to use? Be as general as possible. Be as specific as possible. List only items that are attached to the land. List only items that will be conveyed by bill of sale.

Be as specific as possible. When listing inclusions, it's best to be as specific as possible to avoid misunderstandings between the parties.

Jasmeet, a Colorado real estate professional, is addressing the inclusions and exclusions sections of the sales contract for her clients. As she completes these sections, she needs to _________________________________. Be as brief as possible in order to fit everything in to the small space provided Be specific, describe the items thoroughly, and leave no room for interpretation Describe high-dollar items in detail and be less specific about low-dollar items Specify the dollar amounts associated with each included and excluded item

Be specific, describe the items thoroughly, and leave no room for interpretation

Why should buyers ask sellers of older homes whether they've replaced the wiring system? Because out-of-date electrical wiring can cause a wide a variety of problems. Because the buyer will be required to update the wiring if it's more than 10 years old. Because the seller will be required to update the wiring if it's more than 10 years old. Buyers shouldn't ask about the wiring.

Because out-of-date electrical wiring can cause a wide a variety of problems.

Why would a seller want to sign an exclusive brokerage agreement rather than an exclusive right-to-sell? Because the seller has a potential buyer in mind. Because the seller wanted to divide responsibilities with the broker. To get a higher level of service from the brokerage. To have the opportunity to work with brokers from multiple firms.

Because the seller has a potential buyer in mind.

Use for agriculture irrigation, municipal water supplies, wildlife benefit, for instance.

Beneficial use

Bertha, a Colorado broker, is notified by CREC that a former client has filed a complaint against her. Which of these actions is part of the required process in a CREC investigation? Bertha must ask her employing broker to provide documentation of all her real estate activities related to the complaint. Bertha must cease all real estate activities until the commission's investigation is complete. Bertha must participate in an arbitration program with the client to resolve the dispute. Bertha must submit a response to the complaint in writing and include specific answers to the allegations.

Bertha must submit a response to the complaint in writing and include specific answers to the allegations. CREC uses a defined process to investigate complaints. Rule 6.25.A requires licensees to respond in writing when notified of a complaint against them. The response must include specific answers and factual information related to the complaint.

Who must perform additional duties: a transactional broker, a buyer's agent, or a tenant's agent?

Both a buyer's agent and a tenant's agent

Why would a buyer want to know if any easements or encroachments exist on a property? Both easements and encroachments affect the property's lot size, enjoyment, and use, which can affect a property's value. Both easements and encroachments are illegal. The buyer could end up in court. The buyer may need this information to provide evidence for litigation. The buyer will have to remove these before the property can be re-sold.

Both easements and encroachments affect the property's lot size, enjoyment, and use, which can affect a property's value.

If a licensee will profit from a real estate transaction beyond the amount stated in the listing contract, from whom must the licensee obtain written consent? Both the principal and the broker The cooperating broker The employing broker The principal

Both the principal and the broker

Which of the following must be included in the Colorado sales contract under "Property"? Both the property's legal description and its mailing address are required. Either the property's legal description or its mailing address is required. Only the property's legal description is required. Only the property's mailing address is required.

Both the property's legal description and its mailing address are required.

Which of the following enables listing contract cancellation in Colorado? Broker default Change of heart Low offers Personality conflict

Broker default

When licensees work as property managers, they must select the appropriate brokerage relationship on the Brokerage Duties Addendum to Property Management form, as well as disclose the ____________. Broker's associated specific duties, depending on the type of brokerage relationship Names of all approved repair companies Standard accounting procedures Term of the contract

Broker's associated specific duties, depending on the type of brokerage relationship

Form used when a broker comes into contact with a potential buyer of a property and discusses the possible purchase of that property

Brokerage Disclosure to Buyer

Used when licensees are assisting a seller and come into contact with a potential buyer of a property and discuss its possible purchase

Brokerage Disclosure to Buyer form

Form used when a broker comes into contact with a potential landlord of a property and discusses the possible leasing of that property

Brokerage Disclosure to Landlord

Used when licensees are assisting a tenant and come into contact with a potential landlord of a property and discuss leasing the property

Brokerage Disclosure to Landlord form

Form used when a broker comes into contact with a potential seller of a property and discusses the the possible sale of that property

Brokerage Disclosure to Seller

Which Colorado Real Estate Commission-approved disclosure form should a broker, working with a buyer, use when coming into contact with a potential seller? Brokerage Disclosure to Buyer Brokerage Disclosure to Landlord Brokerage Disclosure to Seller Brokerage Disclosure to Tenant

Brokerage Disclosure to Seller

Paisley, a buyer's agent, comes into contact with a potential seller. Which Colorado Real Estate Commission-approved disclosure form should Paisley use to disclose her brokerage relationship with the buyer? Brokerage Disclosure to Buyer Brokerage Disclosure to Landlord Brokerage Disclosure to Seller Brokerage Disclosure to Tenant

Brokerage Disclosure to Seller The Brokerage Disclosure to Seller form is used when a broker comes into contact with a potential seller of a property and discusses the possible sale of that property.

Used when licensees are assisting a buyer and come into contact with a potential seller of a property and discuss its possible sale

Brokerage Disclosure to Seller form

Form used when a broker comes into contact with a potential tenant of a property and discusses the possible leasing of that property

Brokerage Disclosure to Tenant

Used when licensees are assisting a landlord and come into contact with a potential tenant of a property and discuss the tenant's potential leasing of the property

Brokerage Disclosure to Tenant form

What commission-approved form would you use to disclose your agency relationship with an owner who wants to find tenants? Brokerage Duties Addendum to Property Management Agreement Colorado Rental Agreement Exclusive Right-to-Buy Listing Contract Exclusive Right-to-Sell Listing Contract

Brokerage Duties Addendum to Property Management Agreement

Used to meet the disclosure requirements for client relationships and also defines brokerage duties when brokers opt to use their own attorney-drafted property management agreement

Brokerage Duties Addendum to Property Management Agreement form

Victoria, who owns her own brokerage firm, had her attorney write up a property management agreement for her firm's use. When she landed her first property management client, she provided both this agreement to sign and the ______________. Agreement to Amend/Extend Contract with Broker form Brokerage Duties Addendum to Property Management Agreement form Broker Disclosure to Tenant Exclusive Right-to-Lease Listing Contract

Brokerage Duties Addendum to Property Management Agreement form When brokers opt to use their own attorney-drafted property management agreement, the Brokerage Duties Addendum to Property Management Agreement form meets the disclosure requirements for client relationships and also defines brokerage duties.

Simone is assisting seller Roman in a transaction. The listing agreement they used was drafted by Roman's attorney, rather than the CREC-approved listing agreement Simone's used to. Simone explains to Roman that she's required to ask Roman to sign an additional disclosure as a result. What form does Simone ask Roman to sign? Brokerage Disclosure of Designated Agency Relationship Brokerage Duties Disclosure to Seller CREC Listing Agreement Supplement Definitions of Working Relationships

Brokerage Duties Disclosure to Seller When brokers use a non-CREC-approved listing agreement, they're required to add the Brokerage Duties Disclosure to Seller. This form describes the uniform and additional duties an agent is obligated to perform.

You represent a tenant as a single agent and are showing her several properties today. Which disclosure would you provide to prospective landlords so they know what relationship exists? Brokerage disclosure Change of Status Definitions of Working Relationships Lease

Brokerage disclosure Specifically, you'd provide the Brokerage Disclosure to Landlord, which would indicate to landlords that they are a customer and that you're the tenant's agent.

Advertising by a real estate team must clearly indicate what? Brokerage of the team Licensees who are team members Team contact information Team sales statistics

Brokerage of the team

How a broker works with a consumer (defines duties owed)

Brokerage relationship

What's true of commission-approved standard forms? Brokers can strike through irrelevant portions to delete them. They can't be amended in any way. They're optional for brokers. They require attorney review each time they're used.

Brokers can strike through irrelevant portions to delete them.

Brooklyn, a broker, comes into contact with a potential tenant and is required by law to present the tenant with the Colorado Brokerage Disclosure to Tenant form. What's Brooklyn's working relationship with the landlord? Brooklyn is acting as the landlord's agent or transaction-broker. The landlord and Brooklyn have a signed tenant agency agreement. The landlord is Brooklyn's customer. The landlord is Brooklyn's potential client.

Brooklyn is acting as the landlord's agent or transaction-broker.

In Colorado, who would customarily pay for an inspection of the property to verify the seller's disclosures? Buyer Escrow agent Seller Title company

Buyer

You represent a buyer in a transaction that includes a 2% cooperating agent commission to be paid by the seller. Who's your client? Buyer Seller Seller's agent Seller's sub-agent

Buyer

A broker who represents and advocates for the buyer

Buyer's agent

Broker who represents the buyer (or tenant) in a real estate transaction

Buyer's agent (tenant's agent)

Why has CREC approved different versions of the sales contract for commercial and land sales?

Buyers of commercial and land properties have different needs than residential buyers.

What's equity skimming? Buying a property to take the equity out of it, but not satisfy any debt against it Flipping real estate for a profit Getting multiple appraisals and selecting the one with the highest value Selling for less than is owed to the lender

Buying a property to take the equity out of it, but not satisfy any debt against it

How is an exclusive agency relationship documented in Colorado?

By an addendum to the exclusive right-to-lease contract or exclusive right-to-sell contract

By when must tenant estoppel statements be received in a commercial sales transaction in Colorado? By the deadline specified in Section 3 of the contract By the deadline stipulated in each tenant's lease No later than 10 days before closing, so the buyer has time to review them Within 30 days of contract signing, to give the seller time to collect the statements

By the deadline specified in Section 3 of the contract

By when must tenant estoppel statements be received in a commercial sales transaction in Colorado? By the deadline specified in Section 3 of the contract By the deadline stipulated in each tenant's lease No later than 10 days before closing, so the buyer has time to review them Within 30 days of contract signing, to give the seller time to collect the statements

By the deadline specified in Section 3 of the contract

If a Colorado licensee enters into an agreement to purchase a client's property using the Licensee Buy-Out Addendum, which statement is true? By signing and attaching the Licensee Buy-Out Addendum to the Contract to Buy and Sell, the licensee agrees to hold the property for at least one year before reselling it. By using the Licensee Buy-Out Agreement agrees to forgo commission if the licensee closes on the purchase. The Contract to Buy and Sell, with Licensee Buy-Out Addendum attached, obligates the client to sell to the licensee. The licensee must offer the client at least the list price for the property.

By using the Licensee Buy-Out Agreement agrees to forgo commission if the licensee closes on the purchase.

Which of the following contracts is used for properties in which the seller is 30 days delinquent or in default on the mortgage and is due equity after the sale? CBS Foreclosure Protection Act CBS Income-Residential CBS Residential CBS Short Sale

CBS Foreclosure Protection Act

Which of the CBS contracts is used for income-producing properties? CBS foreclosure CBS income-residential CBS rentals CBS residential

CBS income-residential

Meg's license is up for renewal for the first time, and she knows she's required to take continuing education courses. Where will she find the specific details about her CE requirements for license renewal? CREC meeting minutes CREC rules DORA guidelines Federal statutes

CREC rules

Which of the following types of properties are exempt from the Subdivision Developer's Act is Colorado? Campgrounds Conversion properties Housing cooperatives Timeshares

Campgrounds

Candy wants out of her contract, because she doesn't believe her agent has estimated the property value correctly. She thinks her property is worth more. What must happen before the listing agreement can be terminated? Candy and her agent must mutually agree in writing to terminate their agreement. Candy must notify the agent and give the agent three days to increase the property's price. Candy must notify the agent by phone of her decision to terminate their relationship. Candy must send a written complaint to the brokerage, asking for a new agent to represent her.

Candy and her agent must mutually agree in writing to terminate their agreement.

An investor can defer taxes on which of the following line items through Section 1031 of the Internal Revenue Code? Capital gains tax and recaptured depreciation Income tax and capital gains Income tax and property tax Recaptured depreciation and property taxes

Capital gains tax and recaptured depreciation An investor can defer taxes on capital gains and recaptured depreciation, freeing up those funds to reinvest into another property.

Let the buyer beware; states that apply caveat emptor don't require the seller to disclose known material defects unless asked directly. Colorado is not a caveat emptor state.

Caveat emptor

Form used to disclose the broker's change from an agency relationship to a transaction-brokerage relationship

Change of Status

Laurel represents a buyer as a single agent. The buyer is very interested in seeing one of Laurel's listings, for which she's also a single agent. Which disclosure will Laurel need if she'd like to continue working with both buyer and seller? Brokerage Disclosure Change of Status Definitions of Working Relationships Dual Agency Disclosure

Change of Status

Used immediately when licensees are serving as an agent for both the seller/landlord and buyer/tenant in the same transaction and must begin working with both parties as a transaction-broker, or as an agent with one party and a transaction-broker with the other

Change of Status form

You're completing a sales contract to assist your client with an offer on a property, and you need some contract language to amend a provision in the contract. Where will you look first for such an amendment? Ask a real estate attorney to draft one. Ask your clients to draft an amendment for your broker to review. Check to see if a commission-approved amendment exists. See if a colleague has a previous amendment you can edit.

Check to see if a commission-approved amendment exists.

Some groups of people are more vulnerable to lead poisoning and its effects than others. Of those listed, who is most vulnerable? Children Men Pets Women over age 70

Children

A sloping hearth is a common ______ issue. Chimney/fireplace Foundation Roof Window

Chimney/fireplace

Recognized all persons born in the U.S. as citizens, regardless of race or color; protected the rights of every U.S. citizen to buy, sell, convey, inherit, and possess property, as well as to enter into contracts

Civil Rights Act of 1866

The one for whom the agent acts

Client

The principal in a real estate transaction who is represented by the agent

Client

Client/principal vs. customer

Client/principal: Person who has agent representation Customer: Person related to transaction who is not represented by the agent

Your buyer clients had to take out a loan to purchase their new home. Which document will they receive from their lender at least three days from closing that will compare the final terms and cost of closing with the previous Loan Estimate? Closing Disclosure Escrow Closing Notice HUD-1 statement Mortgage Servicing Transfer Disclosure

Closing Disclosure

What's the only required addendum for the Exclusive-Right-to-Sell Listing Contract in Colorado?

Closing Instructions

Jackie and Jake Jakubowski are selling their home in Greeley, Colorado, to Gwen Svenson. The closing is on May 11. Unless it's otherwise specified in their sales contract, prorations will be calculated as of the _____________. Closing date (May 11) Date Gwen made her offer on the property Date the two parties agreed on the offer and signed the contract Last day of the month of closing (May 31)

Closing date (May 11)

Form that must be completed if the broker is assisting a seller in an a REO or non-CREC approved listing agreement (describes broker duties to seller)

Colorado Brokerage Duties Disclosure to Seller

Allows licensed real estate brokers to perform certain real estate valuation-related activities without being registered, licensed, or certified as real estate appraisers

Colorado Real Estate Appraiser Licensing Act

Colorado law requires continuing education to maintain real estate licensure. Which is the best source for more data on educational requirements? Candidate Bulletin Colorado Real Estate Commission Department of Commerce Department of Personnel

Colorado Real Estate Commission

Which entity creates regulations governing real estate activities in Colorado? Colorado Real Estate Commission Department of Commerce Department of State Public Utility Commission

Colorado Real Estate Commission

An act that applies to subdivisions of 20 or more units and provides rules for registration, disclosure, and buyer rights to cancel

Colorado Subdivision Developer's Act

Establishes finance charge rate limitations for qualified consumer credit sales, consumer loans, and supervised loans (21% regardless of amount, unless the loan is for a residence secured by a first mortgage, in which case the maximum rate is 45%)

Colorado Uniform Commercial Credit Code (U.C.C.C.)

Stays in place for six years unless repaid

Colorado tax lien

What's significant about Colorado's anti-discrimination laws of 1959?

Colorado was the first state to take such anti-discrimination action, nine years ahead of the federal laws.

Who has the responsibility to adopt rules that concern the Colorado's Uniform Electronics Transaction Act?

Colorado's Secretary of State

Which documents offer commission clarification of an existing rule? Commission case interpretations Commission position statements Commission rule details Rulemaking interpretations

Commission position statements

Emily is a Colorado broker who will be placing her license on inactive status for a little while. She wants to make sure she does it properly so she can legally practice real estate again when she's ready. What tool does the commission provide to help licensees understand the license law and the actions they need to follow? A free hard copy of the text of the license law to any licensee Commission-developed curriculum Commission rules Legal advisors on call

Commission rules

If you're looking for guidance on a particular real estate related law, where would the best place be to look for more information? Broker blogs Commission rules State congressional records The annotated statutes

Commission rules

A Colorado licensee is assisting a client in the sale of an unimproved lot in a wooded subdivision where there is a homeowners association. Which of these CREC-approved forms will help the licensee collect all the details for the listing? Common Interest Community Checklist for Brokerage Firms Construction Permit Guide Lead-Based Paint Obligations of Seller Wood-Destroying Pest Treatment History

Common Interest Community Checklist for Brokerage Firms

Real estate that is subject to a declaration containing lots (at least some of which must be residential or occupied for recreational purposes) and common areas; requires disclosure by seller to prospective buyers

Common interest community

Why might an oral representation agreement be a bad idea?

Compensation isn't guaranteed for the broker

Your buyer client Toby is purchasing property served by a small-capacity well that is registered with the Colorado Division of Water Resources. As part of the transaction, what is Toby (or the closing agent) required to do? Complete a change of ownership form Have the well and the water inspected Replace the well with a mid-capacity well Submit a new registration and pay a small fee

Complete a change of ownership form

What must a real estate salesperson with more than two years of experience in another state do to be licensed to practice real estate in Colorado? Complete 72 hours of state-specific education. Complete the brokerage administration course and Colorado portion of the exam. Complete the Colorado part of the broker's exam. Complete the entire Colorado broker's exam.

Complete the Colorado part of the broker's exam.

Water has been appropriated for use, but the user has yet to use it for such and has a limited time to start using it.

Conditional water right

Sometimes referred to as vertical subdivision, this is usually a unit in an apartment-type building in which the unit owners own their units and share in the common space

Condominium

The Colorado Common Interest Ownership Act encompasses which of the following types of properties? Condominiums Hotels Mobile homes Retail properties

Condominiums

Which one of these Colorado contracts is appropriate to use in the sale of a 30 unit apartment building? Contract to Buy and Sell Real Estate (Commercial) Contract to Buy and Sell Real Estate (Income-Residential) Contract to Buy and Sell Real Estate (Land) Contract to Buy and Sell Real Estate (Residential)

Contract to Buy and Sell Real Estate (Income-Residential) A 30-unit apartment building will likely be financed as a commercial property, but the correct contract form to use is the Contract to Buy and Sell, Income-Residential.

A Colorado property valued at $300,000 has a total indebtedness of $100,000. The loan is in foreclosure. What form should be used to write an offer on it? Contract to Buy and Sell Real Estate (Income - Residential) Contract to Buy and Sell Real Estate (Residential) Contract to Buy and Sell Real Estate (Residential) (Foreclosure Protection Act) Contract to Buy and Sell Real Estate (Residential Short Sale)

Contract to Buy and Sell Real Estate (Residential) (Foreclosure Protection Act)

What case influenced the decision of the case of Guaranty Title Co. vs. Denver Bar Association? Abstract Record & Title Co. American Bar Association Conway-Bogue Jameson-John

Conway-Bogue

Colorado Supreme Court declared that brokers can prepare legal real estate documents only when they use standard and approved printed forms in transactions in which they are directly connected and may receive no other compensation besides their commission.

Conway-Bogue Realty Investment Co. vs. Denver Bar Association

Which of the following cases decided by the Colorado Supreme Court led to the adoption and promulgation of CREC rules regarding the use of standard forms? Conway-Bogue vs. Denver Bar Association Record Abstract & Title CO. vs. Denver Bar Association Title Guaranty Co. vs. Conway-Bogue Title Guaranty Co. vs. Denver Bar Association

Conway-Bogue vs. Denver Bar Association The 1957 Supreme Court Decision in the case of Conway-Bogue vs. Denver Bar Association led to the Colorado Real Estate Commission's adoption and promulgation of Rule F, which is now known as Chapter 7.

Party cooperating (but not benefiting from) a tax-deferred exchange

Cooperating party

A housing option in which the owner holds a proprietary lease in the unit and shares in the cooperative association

Cooperative

A seller's response to a buyer's offer, countering some terms (does not list terms acceptable in the original offer)

Counterproposal

Broker Shala is preparing a counteroffer for a residential transaction in Colorado. Which of the following forms should she use? Agreement to Amend/Extend Contract Agreement to Amend/Extend Contract with Broker Counterproposal Inspection Objection Notice

Counterproposal

Used to amend terms of the Contract to Buy and Sell Real Estate, including price, financing terms, and deadlines

Counterproposal

Which of the following forms is used to make a counteroffer for a residential transaction in Colorado? Agreement to Amend/Extend Contract form Agreement to Amend/Extend Contract with Broker Counterproposal form Inspection Objection Notice

Counterproposal form

The fiduciary duties an agent owes their principal were established by _______. Commission rules Court decisions Senate bills Statutes

Court decisions

Which of these items around the fireplace could be a clue that there is a problem? Ash and soot in the firebox Cracked or sloping firebox or hearth Hole in the soffit Missing mantle

Cracked or sloping firebox or hearth A cracked or sloping firebox or hearth can indicate a problem. Buyers will need to know the condition of the fireplace and chimney, since they may face issues after they buy the home.

Don and Becky realized too late that the contract they signed for the sale of their home didn't include any language about a rent-back if the home they're building isn't ready in time. What can their listing agent do? Create a contract addendum with the required language. Create a contract amendment with the required language. Create a counter-offer to present to the buyers. Terminate the contract on Becky and Don's behalf.

Create a contract amendment with the required language. Once a contract is signed, the document to use to alter the terms is a contract amendment.

Which of the following actions would be inappropriate for a Colorado licensee preparing the Contract to Buy and Sell form for a buyer client? Add lines at the bottom of each page for the client's initials. Complete the blanks of the form using a typestyle that's clearly different from the rest of the form. Create an addendum with the client to submit with the form Make a legible insertion or modification that follows client's direct request.

Create an addendum with the client to submit with the form

Which of the following is a requirement when an investor participates in a reverse 1031 exchange? Creating an exchange accommodation titleholder (EAT) Holding title to both the replacement property and the un-relinquished property simultaneously Identifying a replacement property within 180 days Involving a qualified intermediary (QI)

Creating an exchange accommodation titleholder (EAT) An EAT is required in a reverse 1031 exchange as a result of the investor not being allowed to hold title on both the replacement property and the un-relinquished property simultaneously.

Colorado's fair housing laws include additional protected classes not covered by federal regulations. What are these?

Creed and ancestry

Which of the following is a common chimney or fireplace problem? Creosote Damage around the fascia Holes in the soffit None of these

Creosote

A buyer or seller of real estate who's working with a real estate agent, but is't represented by that agent (this shouldn't be confused with a client)

Customer

An individual who has no brokerage relationship with a broker as either an agent or transaction-broker

Customer

An unrepresented individual

Customer

Dave is a licensee who often represents investor clients. He's helping one of those clients make an offer to a homeowner who has some equity in the home, but who's fallen behind on the mortgage payments. What will Dave need to do to ensure the offer is made according to Colorado law? Dave must advise the sellers that they're not his clients, and that an equity purchaser may attempt to profit from the seller's distressed position. Dave must make the offer on the appropriate CBS form, and he must include several attached notices that comply with the Colorado Foreclosure Protection Act. The offer must include a holdover addendum that allows the seller to buy back the home within a certain time period after closing. The offer must include an option to assume the seller's existing mortgage and allow the seller to stay in the home as a renter.

Dave must make the offer on the appropriate CBS form, and he must include several attached notices that comply with the Colorado Foreclosure Protection Act. The Colorado Foreclosure Protection Act requires an offer for a home facing foreclosure, or where the homeowner is in default on the mortgage, to be made on the CBS (Colorado Foreclosure Protection Act), with specific notices attached.

When you're working as a Colorado real estate licensee, you'll avoid discrimination of any sort based on ethical standards set by NAR. But sellers and landlords aren't always so ethical. Which of these prospective buyers for your listing could be protected against discrimination under state law, but not federal law? Christina, a woman of Hispanic descent Dawn and Rita, a married lesbian couple Harvey and Rae, a married couple with six children Luke, a combat veteran who lost a leg to injury

Dawn and Rita, a married lesbian couple

Which of the following scenarios is an example of a dual agent situation? Burke, an employing broker, asks Beth, a licensee who works in his firm, to act as a single agent for Jarod, who wants to sell his house. Debbie, a licensee, represents both Michael, a seller, and John, who wants to buy Michael's property. Jeff is purchasing his first home and has enlisted Laura as his buyer's agent. Niles, a licensee, is working under Mindy, a seller's agent from another firm, and also acting as an agent to the seller.

Debbie, a licensee, represents both Michael, a seller, and John, who wants to buy Michael's property.

Other than during the transition period, the date of license renewal for all licensees

December 31

Security instrument that pledges property as collateral and uses a trustor/grantor (borrower), lender (beneficiary) and third-party trustee

Deed of trust

In Colorado, a mechanic's lien can take priority over which of the following liens if work began before other high-priority liens were recorded? Deed of trust/first mortgage Property tax lien Special assessment lien Super lien

Deed of trust/first mortgage

Tracey and her husband Mick share a small home in Colorado. Although their property taxes are up to date, the two are several months behind in their deed of trust loan payment, and they owe money to a contractor for the work he did last month on their kitchen remodel. If the bank were to foreclose on Tracey and Mick's property, which of the following liens would have the highest priority? Deed of trust/first mortgage Mechanic's lien Real estate tax liens Super liens

Deed of trust/first mortgage

When one or more parties to a contract fail to meet one or more terms of the contract

Default

Under what circumstances may an exclusive buyer or tenant contract be cancelled prior to its expiration date?

Default of either party

What are the benefits of a 1031 exchange?

Deferred capital gains taxes, deferred recapture of depreciation

As a legally binding contract, which of the following does a listing contract need? A good faith estimate of closing costs Attorney review Definite start and end dates Notarization

Definite start and end dates

A form that provides descriptions of the available working relationships that consumers may have with brokers (must be provided upon request)

Definitions of Working Relationships

Rachel is interested in buying a home. She contacts a licensee who provides a document and tells her about the different relationships between consumers and licensees. What document did Rachel receive? Buyer Representation Agreement Change of Status Definitions of Working Relationships Listing Agreement

Definitions of Working Relationships

Which of the following forms is considered a disclosure that can be attached to the Colorado Contract to Buy and Sell Real Estate (Residential), but isn't considered part of the contract? Closing Instructions Closing Statement Definitions of Working Relationships Earnest Money Receipt

Definitions of Working Relationships

Provides descriptions of the available working relationships that consumers may have with brokers; must be provided upon request

Definitions of Working Relationships form

What form in Colorado is used to provide consumers with definitions of available brokerage relationships?

Definitions of Working Relationships form

A tax-deferred exchange in which the closing for the relinquished property occurs first, and the replacement property is subsequently identified and closed on

Delayed exchange

Dermot is in the process of buying property. His ability to complete the transaction is based on his obtaining a loan. Which of the following is a true statement about what Dermot should or shouldn't do during the loan process? Dermot shouldn't buy new furniture, but he can put it on layaway before closing. Dermot shouldn't incur debt or spend money unnecessarily prior to closing. Lenders will run Dermot's credit only once during the loan approval process. Once the lender has approved Dermot's credit, Dermot is free to incur new debt.

Dermot shouldn't incur debt or spend money unnecessarily prior to closing.

You're an associate broker with two current clients. If you have a sudden illness and ask the commission to make your license inactive for a time, which of these is an action your employing broker must take? Designate another broker to represent your clients. Hold all of your commissions. Provide you with copies of all transactional records. Return any trust funds for your current transactions.

Designate another broker to represent your clients.

Designated by the employing broker to act as either a single agent or transaction-broker to a party

Designated broker

Brokerage firms often employ large numbers of licensees. What CREC-required action helps a brokerage ensure that all associates represent the firm consistently, understand the firm's procedures, and follow federal and state laws when practicing real estate? A specified hiring process that ensures employees are honest and know how to follow license law Development of an office policy manual covering a mandated set of topics, reviewed periodically with all workers Regular oversight and mentorship for all associates from an experienced employing broker Weekly sales meetings to reiterate the behaviors required of all associates

Development of an office policy manual covering a mandated set of topics, reviewed periodically with all workers

Sheree's a Colorado broker selling the mountain property her family's kept for years as a vacation spot. Since she's handling the listing herself, which of these actions is Sheree NOT required to take? Deposit the earnest money check provided by a buyer in a brokerage trust account. Disclose that her family never uses the property because they don't feel safe to them. Disclose that she's part owner of the property and is also a real estate licensee. Ensure that all contract documents accurately reflect the terms of the transaction.

Disclose that her family never uses the property because they don't feel safe to them.

A notification provided to a party to a transaction, or to a customer (not considered contracts, even when signed)

Disclosure

Norma, a real estate licensee, is working with the buyers in a transaction. She suspects mortgage fraud. What should she do? Confront the seller and the seller's agent. Discuss the situation with her broker. Hire an attorney to investigate. Threaten to terminate the transaction.

Discuss the situation with her broker. Norma's first step should be to discuss the issue with her broker. She may also elect to withdraw from the transaction.

A land transaction may need to consider which of these factors that wouldn't typically be part of a residential transaction? Allowed uses of the property Disposition of growing crops Structural issues Tenant leases

Disposition of growing crops

A _____________ well in Colorado allows the owner to use the water for household use, livestock watering, and irrigation of up to one acre. Domestic Home and garden Household Residential

Domestic A domestic well allows the owner to use the water for household and specific outside uses, but not to irrigate more than one acre or use the water for commercial purposes.

A buyer in a commercial transaction requests certain due diligence documents in the Colorado commercial sales contract. If the seller doesn't wish to provide those requested documents, what is the recommended action to take? Allow the due diligence document deadline to pass without providing the documents, and hope the buyer doesn't terminate the contract. Draft a counter proposal that doesn't include those documents. Extend the closing date by 14 days to allow for contract renegotiation. Provide alternative documentation that contains essentially the same information

Draft a counter proposal that doesn't include those documents.

Form that informs a buyer/borrower that the broker in the transaction is licensed as both a real estate broker and a mortgage loan originator

Dual Status Disclosure

Used when licensees hold both a real estate license and a mortgage loan originator license and will serve in both capacities in the same transaction

Dual Status Disclosure form

When a broker represents both sides in a real estate transaction; illegal in Colorado

Dual agency

Which agency relationship is illegal in Colorado? Designated agency Dual agency Limited agency Single agency

Dual agency

Which type of brokerage relationship is illegal in Colorado and should be documented as such in a brokerage relationship policy? Designated agency Dual agency Single agency Transaction brokerage

Dual agency

Which section of the Colorado commercial sales contract differs most radically from the residential contract? Due Diligence General Provisions Parties and Property Purchase Price and Terms

Due Diligence

In which section of the Colorado commercial property sales contract would a buyer request documentation pertaining to the property's physical and financial aspects? Damage, Liens, and Indemnity Due Diligence Documents Insurability Zoning

Due Diligence Documents

Lists documentation a commercial or land buyer may request of the seller so the buyer may make an informed decision regarding the overall value of the property

Due Diligence section

Because commercial property requires a more extensive ___________ process, which section in Colorado's commercial sales contract includes paragraphs not found in the residential version? Closing Due diligence Proration Title review

Due diligence

Government program that sets standards for and qualifies homes and energy-efficient home components and building practices

ENERGY STAR®

What's the term for certified energy-efficient homes that have met specific qualifications? Energy-efficient performance homes ENERGY STAR®-qualified homes EPA homes Green with energy efficiency homes

ENERGY STAR®-qualified homes

What must sellers provide prospective buyers of homes built prior to 1978, in addition to the federally required disclosure form? EPA lead safety pamphlet List of reputable home improvement contractors Verbal assurance that the home is lead-free before offering it for sale Written proof that the home is lead-free

EPA lead safety pamphlet

Who must agree to conduct a transaction via electronic methods for electronic signatures and documents to be considered valid? Each party to the transaction The brokerage firm The buyer The seller

Each party to the transaction

Which statement is true about licensing authorities? Each state has its own licensing authority. Each state has the exact same requirements for licensure. Enforcement is conducted at a national level. The National Association of REALTORS® enforces licensing laws nationally.

Each state has its own licensing authority.

A down payment on the buyer's down payment; typically paid when an offer is submitted to the buyer

Earnest money

Josh and Carl make an offer on a two-story house in Wheat Ridge. They write a personal check for $10,000, and their agent submits that check with their offer. This payment is known as: Assumption Earnest money Good funds Seller concessions

Earnest money

A nonpossessory right to use another's property in a manner established by either express or implied agreement

Easement

Possible disciplinary actions that may be imposed on a licensee as a result of commission investigations include which of the following? Education, probation, suspension Education, suspension, imprisonment Fines, education, community service Imprisonment, fines, community service

Education, probation, suspension

If the parties to the Colorado Contract to Buy and Sell Real Estate (Residential) order a new survey, which of the following is true? Either party may order and/or pay for the survey. The buyer must order and pay for the survey. The person who orders the survey must be the one to pay for it. The seller must order and pay for the survey.

Either party may order and/or pay for the survey.

Ella, a broker, comes in contact with a potential landlord and is required by law to present the landlord with the Colorado Brokerage Disclosure to Landlord form. What's Ella's working relationship with the tenant? Ella is acting as the tenant's agent or transaction-broker. The tenant and Ella have a signed listing agreement. The tenant is Ella's customer. The tenant is Ella's potential client.

Ella is acting as the tenant's agent or transaction-broker.

You're reviewing the title advisory section of CREC's Contract to Buy and Sell Real Estate (Residential) with your buyer clients, and you reiterate the importance of their needing to review the title documents carefully. What else do you do? Encourage them to seek legal counsel before signing the contract. Explain how title insurance will insure and protect them against everything. Explain that everything that impacts title, ownership, and use of the property is covered in the title documents. Offer to research how much it would cost them to buy the oil, gas, water, and mineral rights.

Encourage them to seek legal counsel before signing the contract.

A building wall, fence, or other fixture that extends beyond the land of the owner and illegally intrudes on land of an adjoining owner or a street or an alley

Encroachment

Because of the topography of Elsie's and Lawrence's respective yards, Elsie had to install her fence at the top of a hill, which is actually two feet over Lawrence's property line. What word or phrase best describes Elsie's fence? Easement in gross Encroachment Servient estate Visible easement

Encroachment

Justin decided to build a privacy fence around his yard. He thought the fence was along the property line, but it turns out he built it one foot inside his neighbor's property. What will an inspector document as existing on the neighboring property? Easement Eminent domain Encroachment Necessity

Encroachment

What's the chief function of licensing laws? Create career paths for real estate professionals Ensure that consumers are protected Generate funding for professional education and research Grow the economy through a pipeline of professionals

Ensure that consumers are protected

Any of several fraudulent means whereby a seller in distress (facing foreclosure, or in default) is robbed of any equity in the property

Equity skimming

Fraudulently removing the equity in the property of a distressed homeowner by obtaining title and promising to remove its debts (a Class 5 felony in Colorado)

Equity skimming

Jonathan has come up with a plan. He's going to offer to buy property belonging to his neighbor, who's struggling financially, collect rent from his neighbor, and not make the mortgage payments. He'll rake in the rent until the bank forecloses. Which type of mortgage fraud scheme is this an example of? Equity skimming False identity Property flipping Straw buyers

Equity skimming

May be prepared by either a real estate licensee or an appraiser; may not be called an appraisal unless prepared by a licensed or certified appraiser

Estimate of value

Section 11 of the Colorado commercial sales contract, titled__________________, is essential information for commercial property that's being leased but is generally not needed for residential transactions. Due Diligence Estoppel Statements Inclusions and Exclusions Possession

Estoppel Statements

Discloses the terms and conditions of pre-existing leases and tenants that may be staying with the property when sold

Estoppel statement

A valuation prepared by a broker for financing purposes (dollar amount limits apply, beyond which the evaluation must be performed by a licensed or certified appraiser)

Evaluation

One who takes title to property to meet the requirements of IRS section 1031 and Treasury Revenue Ruling 2003-37 to facilitate a reverse exchange

Exchange accommodation titleholder (EAT)

Person doing (and benefiting from) a tax-deferred exchange

Exchanger

Items that the seller will take at transfer of title that would ordinarily be left behind

Exclusions

Items to be removed from the property at closing

Exclusions

Which of the following is used to form an agency relationship between a Colorado licensee and a buyer? Contract to Buy and Sell Real Estate Income-Residential Contract to Buy and Sell Real Estate (Residential) Definitions of Working Relationships form Exclusive Right-to-Buy Listing Contract

Exclusive Right-to-Buy Listing Contract

What commission-approved form would you use to list a property for which an owner would like to find tenants? Colorado Rental Agreement Exclusive Brokerage Contract Exclusive Right-to-Lease Listing Contract Exclusive Right-to-Sell Listing Contract

Exclusive Right-to-Lease Listing Contract

Which of the following forms has the Colorado Real Estate Commission approved and mandated to establish the agency relationship between a broker and a tenant? Definitions of Working Relationships Exclusive Right-to-Buy Listing Contract Exclusive Right-to-Sell Listing Contract Exclusive Tenant Listing Contract

Exclusive Tenant Listing Contract

Gives one agent right to sell property for a certain time, but the seller reserves the right to sell his property without the agent's assistant and not owe a commission

Exclusive agency

A listing agreement in which the listing broker has an exclusive right to the commission, regardless of who locates a buyer, including the seller

Exclusive right-to-sell

This is used for small residential or livestock purposes and must meet strict criteria to avoid administration.

Exempt well

Colorado offers an alternative to administrative hearings in the resolution of licensing and disciplinary issues. What's the alternative called? Alternative dispute resolution Conflict resolution service Expedited settlement program Voluntary probation

Expedited settlement program

Exists when a contract, either written or oral, is in place; sets specific duties and responsibilities of the parties to the contract; Colorado only recognizes written express authority.

Express authority

What are two primary uses for the Agreement to Amend/Extend Contract with Broker addendum?

Extend the contract term, change the list or lease price

Naomi and her husband, Rob, have applied for an FHA loan to purchase a new condominium. What issues might they encounter with this type of loan? FHA doesn't loan on condominiums. FHA requires 50% of the units to be under contract. FHA requires HOA boards to submit monthly reports to the lender. FHA won't loan if HOA fees are more than $200 per month.

FHA requires 50% of the units to be under contract.

Title VIII of the Civil Rights Act; prohibited discrimination in the sale, rental, and financing of housing and housing-related transactions based on race, color, national origin, and religion

Fair Housing Act of 1968

Provided consumers with remedies if they believed they were victims of discrimination in the sale, rental, or financing of housing; also added familial status and disability (both physical and mental) to the existing protected classes

Fair Housing Amendments Act of 1988

Abigail doesn't want the lenders to know that she's the buyer in a real estate transaction, so she's using her aunt's name and credit information to obtain the loan. Which type of mortgage fraud scheme is this an example of? Equity skimming False identity Property flipping Wire transfer fraud

False identity

Ned doesn't want the lenders to have his personal information, so he's applying for a home loan under an assumed name. Which type of mortgage fraud scheme is this an example of? Equity skimming False identity Property flipping Silent second

False identity

Which of the following liens may be placed against real property if the property owner fails to pay gift tax? Federal tax Property tax Special assessment State tax

Federal tax

A person in whom another's trust and confidence is placed

Fiduciary

A person who is in a position of trust and owes loyalty to another

Fiduciary

What do licensees have to do after obtaining errors and omissions coverage? Add the policy number to their broker advertising. Arrange for automatic renewal of coverage. Display their coverage certificates at their brokerage office. File proof of coverage with the Real Estate Division.

File proof of coverage with the Real Estate Division.

Filomina is preparing to sell her home and thinks she should test for radon. Which of the following options about radon testing is true? Filomina can hire a professional to perform the test, or she can buy a test kit and submit it to a lab for analysis. Filomina can purchase a home test kit and interpret the results herself. Filomina is required to test for radon and perform any necessary mitigation before placing her property on the market. Filomina must hire a certified testing company to perform the radon test and interpret the results.

Filomina can hire a professional to perform the test, or she can buy a test kit and submit it to a lab for analysis. Test kits are available for purchase but must be sent to a lab for analysis. A radon technician can also place the test, pick it up, and send it in for testing. Licensees should advise all buyers to have homes tested for radon, regardless of location.

Which of these is a factor that differentiates a commercial property transaction from most residential transactions? Contracts for commercial transactions can be terminated for any reason, at any time before the closing date. Financing for a commercial property tends to be riskier for the lender because the borrower is not usually an occupant. The value of most commercial properties lies primarily in the land, while a residential property's value is in the improvements. Transactions for commercial properties typically don't require any seller disclosures. Sellers of residential properties are legally required to disclose latent defects, among other things.

Financing for a commercial property tends to be riskier for the lender because the borrower is not usually an occupant.

Which option best defines prior-appropriation water rights? According to need, not greed Closest to source, first in right First in time, first in right Tied to the land itself

First in time, first in right Prior-appropriation water rights are determined by whoever uses the water for a beneficially determined use first, and rights may be sold separate from the land itself.

Cameron served as a real estate broker and a mortgage loan originator in the same transaction. How many years must Cameron keep a copy of the Dual Status Disclosure? Five Four Three Two

Five

Colorado law requires Dual Status Disclosure forms to be kept for _______ years. Five Four Three Two

Five

How many members make up the Colorado Real Estate Commission? Five Nine Seven Three

Five

Tony served as a real estate broker and a mortgage loan originator in the same transaction. How many years must Tony keep a copy of the Dual Status Disclosure? Five Four Three Two

Five

According to Section 2.7.3, Well Rights, of the Colorado land sales contract, which of these land transactions will involve a Change in Ownership form for the well? 10 acres with a commercial well 10 acres with an unregistered well 180 acres with an irrigation well Five acres with a domestic well in a subdivision

Five acres with a domestic well in a subdivision

Number of members on the Colorado Real Estate Commission

Five members: three brokers and two members of the public, each serving a three-year-term

For how long must Colorado brokers retain the Dual Status Disclosure form on file?

Five years

When would you use the Residential Addendum with the sales contract? For a commercial property transaction in which some or all property will be used as a residence For a residential property transaction intended as an investment For a residential property transaction with more than four dwellings For a residential transaction with a dwelling that's more than 99 years old

For a commercial property transaction in which some or all property will be used as a residence

A legal procedure whereby property used as security for a debt is sold to satisfy the debt in the event of default in payment of the mortgage note or default of other terms in the note

Foreclosure

What could discolored soil, soft spots, or mounds on the land indicate? Former waste disposal site Historical district Natural hazard Underground storage tank

Former waste disposal site

How many year(s) must a licensee keep Change of Status forms? Five Four One Two

Four The Colorado Change of Status form must be kept by licensees for four years.

Carl and his tenant client have a written and signed exclusive tenant contract. In accordance with Colorado law, how long is Carl required to keep a copy of the contract on file? Five years Four years Six years Three years

Four years

Colorado brokerage records should be retained for how long? Four years One year Seven years Three years

Four years

For how long must Colorado brokers retain most disclosure forms on file?

Four years

How long must Brokerage Disclosure to Sellers/Landlords or Buyers/Tenants forms be kept on file in Colorado? Four years Six months Six years Two years

Four years

How long must Colorado licensees keep transactional records?

Four years

Period of time brokers must retain transactional records

Four years

Douglas is the buyer's agent for a transaction in which May (from a different brokerage) listed her seller client George's property. From whom will Douglas receive his compensation? From George From his own broker From May's broker It depends

From his own broker

A full disclosure state (such as Colorado) requires the seller to disclose known issues.

Full disclosure

Fixtures usually stay with the property, whereas personal property goes with the seller. Which of these items would go with the seller? Cabinets attached to the garage walls Claw foot tub Furniture Garage door opener

Furniture

If Elizabeth is a property manager, she is acting as what of type of agent? Dual General Special/specific Unlicensed

General

A person who is authorized to act for another (the principal or client) in a range of matters; often a property manager acts as this

General agent

An optional seller disclosure used to highlight the energy-efficient features of the home; allows the home to be listed as green on the MLS

Green Disclosure

You're discussing the rules promulgated by the Colorado Real Estate Commission with a group of licensees from various brokerages. Each broker seems to have a different opinion about the rules. Who do you think is correct? Danielle says, "We only need these rules if we don't have an employing broker. Employed brokers follow their office policy, which can be different than the rules." Greg says, "These are regulations that support and help us interpret what the license law says, and we're required to abide by them." Ruby says, "These are the laws that every real estate broker in the United States is required to follow." Seth says, "These are the ethical guidelines the commission would like us to follow."

Greg says, "These are regulations that support and help us interpret what the license law says, and we're required to abide by them."

Ben is a Colorado broker representing Harvey in the purchase of a 1,600-acre working cattle ranch that includes a 10-room bed and breakfast. Which of these parties is best qualified to assist Harvey when it's time to prepare the sales contract? Ben, Harvey's broker Ben's employing broker Harvey's attorney The closing company

Harvey's attorney

When a seller is providing financing to a buyer, the Colorado real estate broker should ___________. Complete the CREC-approved promissory note and deed of trust Have an attorney complete the financing provisions of the sales contract Inform the seller that Colorado law prohibits seller financing in real estate transactions Negotiate the loan terms between the parties before completing the financing provisions of the sales contract

Have an attorney complete the financing provisions of the sales contract

Hugh runs a successful brokerage, though it's one of several franchises of the national Super National Homes chain of brokerages in his metro area. In order to take advantage of the national trademark's reputation in his advertisements, he's required to do what? Have permission from the trademark owner to use it, and include a specific statement in his advertising that the firm is independently owned and operated. Maintain a separate broker's license on behalf of the third-party company. Pay CREC an additional licensing fee for the rights to use the trademark publicly. Use the phrase "used with permission" wherever the trademark appears.

Have permission from the trademark owner to use it, and include a specific statement in his advertising that the firm is independently owned and operated.

Sam is a licensee who believes strongly in adhering to fair housing laws. When his broker asks him to "just lighten up a little" and work with a client who's refusing to sell to a certain buyer because of her religion, what's the potential consequence to Sam of sticking to his beliefs? He may be reprimanded by HUD. He may have to deal with ridicule or disdain from his broker. He may lose his license for not following his broker's directions. He may never be able to find another client who will work with him.

He may have to deal with ridicule or disdain from his broker.

Sam is licensed as a real estate broker and as a mortgage loan originator. He's acting in both capacities for his buyer client Jerry, who's taking out a loan to purchase his first home. A week after Sam accepted Jerry's loan application, Sam suddenly has a terrible feeling that he's forgotten something. Which of these would get Sam into trouble? He didn't present the seller, who's represented by another broker, with a Change of Status form before the seller and Jerry signed the purchase agreement. He forgot to ask his employing broker to designate him as Jerry's agent. He forgot to include the Brokerage Duties Disclosure to Buyer with the brokerage agreement. He neglected to obtain Jerry's consent on the Dual Status Disclosure form within the proper timeframe.

He neglected to obtain Jerry's consent on the Dual Status Disclosure form within the proper timeframe.

Inconsistent temperatures from room to room is a common indication of a problem with what system or home feature? Electrical Foundation Heating and cooling Roofing

Heating and cooling

What's the purpose of regulations? Expand laws Help put laws into effect Limit laws Provide alternatives to laws

Help put laws into effect

Which clause prevents buyers or tenants from reaching an agreement with a seller or landlord on a property and then discarding their brokers so that neither party has to pay a broker commission? Habendum Holdover Period (Broker Protection) Seisin (Buyer Fraud Cease and Desist) "Weasel" Prevention

Holdover Period (Broker Protection)

Which form should accompany the completed Colorado contract form when offering to buy a property that is in foreclosure? Foreclosure Act Addendum Homeowner Cancellation Notice (Principal Language) Homeowner Warning Notice Notice of Cancellation

Homeowner Warning Notice The Homeowner Warning Notice is a required attachment to the Contract to Buy and Sell (Colorado Foreclosure Protection Act) which notifies the seller of a three-day right to cancel.

The purpose of the Colorado Common Interest Ownership Act was to facilitate more effective what? Advertising and marketing Homeowner rights Homeowners associations Sales and leasing

Homeowners associations

Amended the Fair Housing Act of 1968 to add sex to the list of protected classes

Housing and Community Development Act of 1974

This type of property is considered a subdivision in Colorado when there are 20 or more shares in the corporation. Condominium Housing cooperative Office building Timeshare

Housing cooperative Interests in housing cooperatives are shares of a corporation, however when there are 20 or more shares offered within the property, it is considered a subdivision under the Subdivision Developer's Act.

Stated that communities and facilities meeting certain criteria for providing housing to older persons are legally exempt from familial status discrimination; housing must have one person age 55 or older residing in at least 80% of occupied units and the housing provider must demonstrate housing is intended for persons 55 and older.

Housing for Older Persons Act of 1995

Which act states that communities and facilities that meet certain criteria for providing housing to older persons are legally exempt from familial status discrimination? Fair Housing Amendments Act of 1988 Federal Fair Housing Act of 1968 Housing and Community Development Act of 1974 Housing for Older Persons Act of 1995

Housing for Older Persons Act of 1995

A Colorado buyer is taking out an FHA loan to purchase a house. What's the key consideration for determining the settlement date? How long the lender needs to complete the loan process The date the buyer prefers The date the original contract was written The date the sellers prefer

How long the lender needs to complete the loan process

Paulo signed an open listing agreement with Debbie, his real estate agent. Which of the following statements is true? Debbie will receive her commission regardless of who brings the buyer to the property. If Paulo finds a buyer on his own, he doesn't owe anyone a commission. Paulo may not have more than one open listing Paulo won't owe a commission if he finds the buyer, but the buyer will have to pay the commission.

If Paulo finds a buyer on his own, he doesn't owe anyone a commission.

Julie has been pre-approved for a mortgage at a 4% interest rate. At this interest rate, she can just afford the $250,000 home in her budget. Which of the following is true? If interest rates rise, she may be priced out of the market. Julie can't really afford a mortgage. Julie isn't creditworthy. Julie's pre-approval is dependent on her interest rate.

If interest rates rise, she may be priced out of the market.

Which one of the following statements about the option period for a valid option contract is true? If the contract doesn't state the length of the option period, a court will require the optionor to make the option period for a "reasonable time." The contract doesn't have to specify a specific length of time for the option period. The optionee must purchase the property within the option period stated in the contract. The optionor may sell the property to someone else during the option period.

If the contract doesn't state the length of the option period, a court will require the optionor to make the option period for a "reasonable time."

Your clients want you to host an open house next weekend but you'll be at your son's wedding. Is there a circumstance under which your unlicensed assistant Ava can host the open house? Ava can't legally host the open house. If the seller consents. If you're ill. If you're more than 250 miles away.

If the seller consents.

What does a success fee arrangement with a buyer say about seller default?

If the seller defaults during the transaction with no fault on the buyer's part, the fee is waived. If the buyer defaults, the buyer must still pay the fee.

Isn't written into a contract; recognizes that a broker may need to take certain actions in order to carry out express authority duties.

Implied authority

Outcome of spot survey; provides reasonable assurance regarding property boundaries and possible encroachments

Improvement location certificate (ILC)

Similar to a survey, this is a very basic way to describe and locate property, and show where improvements, encumbrances, and easements are (often required by lenders and insurance companies)

Improvement location certificate (ILC)

Uses public record and previous reports to identify boundaries and improvements on the property, but does not confirm their existence with a physical inspection

Improvement location certificate (ILC)

Where are underground storage tanks primarily found? In newer homes In newer industrial sites In older homes and former industrial sites In parks and golf courses

In older homes and former industrial sites

A listing broker will receive a commission equal to 7% of the gross rent for the life of the lease. How is this documented in the Exclusive Right-to-Lease Listing Contract? All negotiated compensation details should go in the Additional Provisions section with any necessary calculations shown on an attachment. In the Compensation to Brokerage Firm section, the numeral 7 is entered documenting the percent of the gross rent that will serve as commission. The compensation percentage and type is entered in the Landlord's Obligations to Broker section of the contract. The Rental Rate and Terms section of the contract indicates what percentage of the rental rate will go to the broker as a leasing commission.

In the Compensation to Brokerage Firm section, the numeral 7 is entered documenting the percent of the gross rent that will serve as commission. The broker's commission is documented in the Compensation to Brokerage Firm section.

Items that will remain at transfer of title that would ordinarily be removed by the seller

Inclusions

Items to be left with the property at closing

Inclusions

In which section of the Colorado land sales contract are fixtures or personal property to be conveyed in the sale addressed? Exclusions Fixture Conveyance Inclusions Personal Property—Conveyance

Inclusions Buyers should list items they'd like included in the sale in the Inclusions section of the land sales contract.

Similar to an Exclusive Right-to-Sell Listing Contract, a lease listing contract allows the landlord to document anything that will stay with the property for the life of the lease. This would be done in which contract section? Additional Terms Conveyances Inclusions and Exclusions Encumbrances

Inclusions and Exclusions

Any appliances and fixtures that the seller intends to include in the sale of the property must be listed, as must any items the seller will remove that would ordinarily remain

Inclusions/Exclusions Attachment to Listing Agreement Disclosure and/or Addendum

Which of the following benefits does a 1031 exchange provide to investors? Avoiding taxes permanently Increased funds to purchase a higher-value property Increased property value Recapturing 100% of the depreciated value

Increased funds to purchase a higher-value property Deferring taxes through a 1031 exchange allows an investor to put money that would otherwise go to paying taxes or recapturing depreciation into their next investment property.

The Wilsons are selling their home and have asked that an appraiser they know perform the appraisal on the property. Sidney, the buyer's agent, is surprised when the appraised value comes in considerably higher than the competitive market analysis she prepared. Sidney is concerned that this might be an example of which type of mortgage fraud scheme? Equity skimming False identity Inflated appraisal Straw buyers

Inflated appraisal

When Marcy toured her new client's house, she noticed paint peeling off of the shutters. When she asked the seller if the house was painted with lead-based paint, he replied, "I'm not sure ... I inherited the house from my dad, who built it in the '50s." What is Marcy required to do? Based on the build date, she should assume the property has lead-based paint and advise the seller that it must be remediated before listing the property. Have the seller test for lead-based paint. Inform the seller that he needs to complete the lead-based paint disclosure form and provide potential buyers with the EPA pamphlet regarding lead hazards. Take a sample of the peeling paint with her, have it tested, and have the seller reimburse her for the testing cost at settlement.

Inform the seller that he needs to complete the lead-based paint disclosure form and provide potential buyers with the EPA pamphlet regarding lead hazards.

Buyer's notice to seller of a defect found during the inspection that the buyer requires the seller to remedy

Inspection Objection Notice

A notice to seller that buyer objects to some items in the inspection

Inspection Objection form

Which commission-approved form related to inspection contingencies is an amendment to the sales contract? Inspection Amendment Inspection Contingency Outcome Inspection Objection Inspection Resolution

Inspection Resolution The Inspection Resolution is signed by both parties and is amends the sales contract.

A document detailing the terms of the resolution the parties negotiate for inspection issues (becomes part of the sales contract)

Inspection Resolution form

Which type of well would be required for a 15-acre vegetable farm? Domestic well Irrigation well Multiple-use well Unregistered well

Irrigation well

A brokerage can use a trade name in its print and web advertising, as long as the trade name ________. Doesn't use obscene or offensive language Is fewer than 220 characters Is first filed with the Colorado Real Estate Commission Isn't already taken by another company in Colorado

Is first filed with the Colorado Real Estate Commission

You have an investor client who's interested in learning more about the advantages of a 1031 tax-deferred exchange. What might you tell him? It allows an investor to avoid ever paying taxes from gains realized on their investments. It allows investors to defer capital gains taxes when selling a property, provided they buy a like-kind property within a set amount of time. It offsets capital gains for homeowners who have lived in the home for at least two years. It provides a tax shelter for non-real estate investments.

It allows investors to defer capital gains taxes when selling a property, provided they buy a like-kind property within a set amount of time.

Mona has a pre-approval letter. What effect will the letter have on her offer? It assures the seller that Mona's financial information has been verified. It provides some assurance to the seller, but not as much as if Mona had a pre-qualification letter. It will have no effect. She'll be able to use it to her advantage to negotiate a better deal with the seller.

It assures the seller that Mona's financial information has been verified.

Your home inspector Mason found some discoloration in the attic and near the windows on the second floor. Why does he think this may be a concern? Dark stains in the attic could mean plumbing problems. It could be a sign of fire damage. It means that the homeowners haven't insulated well. It's indicative of insect activity.

It could be a sign of fire damage.

Which of the following statements is true of the Definitions of Working Relationships document? It describes how the commission oversees real estate licensees. It describes the relationship between the broker and licensee. It describes the relationships a consumer could have with a licensee. It's a legal, binding contract.

It describes the relationships a consumer could have with a licensee.

Which of the following is true regarding the Estoppel Statement provision in the Colorado Contract to Buy and Sell Real Estate (Commercial)? It documents the tenants' agreement (or disagreement) with the seller regarding the terms of the existing lease. It prevents existing tenants from requesting changes to the lease agreement after the transaction is closed. It prohibits the buyer from making changes to the existing lease agreements after the transaction closes. It prohibits the seller from making any changes to existing tenants and lease agreements while under contract.

It documents the tenants' agreement (or disagreement) with the seller regarding the terms of the existing lease.

When it comes to inclusions, how does the Colorado land sales contract differ from the residential contract? It doesn't list specific inclusions. Its list of inclusions is much longer than the residential contract's. Listed inclusions are limited to farm equipment and fencing. There is no Inclusions section, since the contract is only used for land.

It doesn't list specific inclusions.

When a property is overpriced, what happens? A backlog of buyers will return to it again and again. It can usually list again at a higher price. It increases buyer interest and demand. It may become stale on the market, resulting in low-ball offers.

It may become stale on the market, resulting in low-ball offers.

What must be done for a fee to be considered acceptable under RESPA? It can only be split 10% with the settlement service provider. It must adhere to the 80/20 rule. It must be disclosed to the client. It must only be between affiliated businesses.

It must be disclosed to the client.

Nancy is in the market for some unimproved land. She's concerned that she doesn't know enough about the risks involved, and how to interpret all of the information. If she is your client, what should you tell her? It would be wise to consult a real estate attorney before making a purchasing decision. She shouldn't worry, because you are very experienced in this area of real estate. You can provide all of the advice she will need. You will investigate and make sure she has the information she needs.

It would be wise to consult a real estate attorney before making a purchasing decision.

Which one of the following statements is true about a sales contract that's been signed by both parties, and both parties have been notified of its acceptance? It can also be called the consumer notice. It consists of two pages: a brief description of the agreement and a signature page. It's a legally binding contract. It's the document buyers and their agents use to enter into a business relationship.

It's a legally binding contract.

What purpose does the promissory note serve? It gives the lender the right to begin foreclosure proceedings if the buyer defaults. It gives the trustee the right to begin foreclosure proceedings if the buyer defaults. It's a promise made to the buyer that the lender will not foreclose as long as the note is kept current. It's a promise the buyer makes to the lender that the note will be repaid in full.

It's a promise the buyer makes to the lender that the note will be repaid in full.

What's true about undisclosed dual agency? It's a violation of license law. It's legal if your broker allows it. It's only a problem if you don't disclose to the buyer. It's only a problem if you don't disclose to the seller.

It's a violation of license law.

Jake is buying a house from Carrie. Under the terms of the Colorado Contract to Buy and Sell Real Estate (Residential), a new survey must be ordered. Jake orders the survey. Who must pay for it? Carrie must pay for it. It's negotiable: either Jake or Carrie can pay for it, or they can split the cost. Jake must pay for it. The lender must pay for it.

It's negotiable: either Jake or Carrie can pay for it, or they can split the cost.

What's the most important reason to provide prospective clients with the Definitions of Working Relationships form? It's a good practice. It's required by law. Providing this form ensures that a prospective client can't sue you. The Colorado Real Estate Commission suggests you do so.

It's required by law.

Why must a property's legal description be provided in the sales contract? It's required for legal purposes. It's required for tax records. It's required if the buyer is obtaining financing. It's required under the federal Fair Housing Act.

It's required for legal purposes.

Jack, a Colorado broker, is feeling good about the transaction he just closed, which added a tidy sum to his bank account. That is, until he receives notice from CREC that the buyer in the transaction has lodged a complaint against him, accusing him of acting unethically. Which of these actions from Jack would constitute violation of license law and give the buyer a reason for the complaint? Jack didn't disclose that the home the buyer purchased was the site of a recent suicide, even though the seller told him about it. Jack is related to the buyer and disclosed this relationship to his seller client. Jack used a bidding war to negotiate a higher price than the property was originally listed for, and now the buyer feels it was too high. Jack was selling his own property and didn't disclose his license status to the buyer.

Jack was selling his own property and didn't disclose his license status to the buyer.

Sally has an open listing agreement with licensees Bert and Janice, but she signed first with Bert. If one of Janice's prospective buyers buys the house, who gets a commission? Bert Bert and Janice Janice No one

Janice

Jason signed an exclusive agency agreement with Blue Mountain Brokerage. What happens if Jason sells the property himself? Blue Mountain Brokerage can sue to collect its commission if Jason doesn't pay it. Jason isn't obligated to compensate Blue Mountain Brokerage. Jason must pay Blue Mountain Brokerage its full commission. Jason's obligated to pay Blue Mountain Brokerage a portion of its commission.

Jason isn't obligated to compensate Blue Mountain Brokerage.

Jerome, a broker at a large firm, and the seller are filling out the Colorado Brokerage Duties Disclosure to Seller form for a REO transaction. What must Jerome do with the form once it's completed? By law, both Jerome and the seller must sign and date the form, and he must keep both an electronic and hard copy of the form on file. Jerome must have his broker sign and date the form and retain a copy of the file for his broker's records. Jerome must provide a copy of the form to all prospective buyers. Jerome must provide a copy to the seller and keep a copy on file with his broker for at least four years.

Jerome must provide a copy to the seller and keep a copy on file with his broker for at least four years.

Which of the following scenarios is an example of a single-agent situation? Ben, an employing broker, asks Bonnie, a licensee who works in his firm, to act as a single agent for James, who wants to sell his farm. Dawn, a licensee, represents both Mary, a seller, and Jeb, who wants to buy Mary's property. Juan is purchasing his first home and has enlisted Letty as his buyer's agent. Ned, a licensee, is working under Merle, a seller's agent from another firm, and also acting as an agent to the seller.

Juan is purchasing his first home and has enlisted Letty as his buyer's agent.

Which of the following liens is used to ensure that people who win lawsuits over property owners get the money they're owed? Judgment Property tax Special assessment State tax

Judgment

Stays attached to real property for six years, even when the debtor sells or otherwise transfers the property

Judgment lien

Karla is furious at her real estate agent, Yolanda, who Karla feels is responsible for the sale of her home falling through at the last moment. She files a complaint against Yolanda with the Colorado Real Estate Commission. What happens next? CREC will notify both Yolanda and her employing broker (if she's employed) of the complaint, and give them 30 days to find a resolution with Karla. CREC will set up a mediation between Karla and Yolanda, and will notify them both of the time and date. Karla will have to wait 10 to 12 business days to hear back from the commission and find out if they'll investigate her complaint. Yolanda will receive a letter of admonishment from CREC, and must attend the next scheduled CREC meeting to state her case related to the complaint.

Karla will have to wait 10 to 12 business days to hear back from the commission and find out if they'll investigate her complaint.

A Colorado seller is including a freestanding refrigerator in the sale. What must he include in the disclosures? Any warranties supplied by the manufacturer or purchased by the seller Date of purchase of the appliance Knowledge of any defects Serial number and original purchase price

Knowledge of any defects

In a residential sale, what should the seller disclose about the electrical system? Date of installation and name of electrician who installed it Knowledge of any defects in the system Last system inspection and knowledge of any defects Quality of materials used during construction

Knowledge of any defects in the system Known defects in the electrical system must be disclosed on the Seller's Property Disclosure form.

Which type of facts about a property are considered pertinent to the seller's disclosure in Colorado? Known material defects Nonmaterial defects Relative usefulness of materials Superior quality of materials

Known material defects

Kristy is licensed as a real estate broker and a mortgage loan originator in Colorado. She's the buyer's agent in a transaction in which the buyer/borrower must apply for a loan, and has asked Kristy for her help as a mortgage loan originator. Which of the following statements about this situation is true? It's illegal for Kristy to represent this buyer. She must remove herself from the transaction. Kristi must present the buyer/borrower with a Change of Status form. Kristy must present the buyer/borrower with the Colorado Dual Status Disclosure form. The buyer/borrower must use Kristy as the mortgage broker in the transaction.

Kristy must present the buyer/borrower with the Colorado Dual Status Disclosure form.

A certification issued by the U.S. Green Building Council that measures the performance of a qualified home in nine specific areas

LEED

Which version of the Colorado sales contract contains a provision regarding growing crops? Agricultural Commercial Land Residential

Land The land sales contract specifically outlines how growing crops are to be handled.

An agency relationship in which the broker represents and advocates for the landlord (mimics seller's agency in terms of fiduciary duties and responsibilities)

Landlord agency

Your buyers love the 1891 Victorian they have under contract, but they want to get both the water and the paint tested as soon as possible. What are they testing for in both water and paint? Asbestos Lead Mold Radon

Lead

Sellers, landlords, and real estate agents are required to include a ______ in the contract or lease if the real estate was built prior to 1978. Denial of responsibility for lead-based hazards Lead abatement discount Lead warning statement Notice of local lead renovators

Lead warning statement

A substance that is hazardous to a homeowner's health and that was banned in 1978; requires EPA pamphlet and disclosure

Lead-based paint

Sally's a first-time homebuyer. She's a little nervous about finding a good real estate licensee to help her—she's read about a lot of scams out there. Which of the following provides protection for consumers like Sally? Criminal courts License laws Real estate education providers The U.S. Constitution

License laws

Which of the following does the commission of real estate require when a licensee commits a criminal violation, submits a plea in a criminal matter, or receives a criminal conviction? Employing brokers are required to report such incidents immediately to the commission so the licensee's license may be revoked. Licensees are required to report any criminal violations, pleas or convictions to the commission by filing a complaint against themselves. Nothing. The commission of real estate has no interest or authority in criminal matters. The commission regularly sweeps local criminal authorities' databases for information on licensees. Licensees may need to respond to commission inquiries.

Licensees are required to report any criminal violations, pleas or convictions to the commission by filing a complaint against themselves.

Landlord agency is what kind of agency? Limited Secret Universal Unlimited

Limited

A buyer defaulted on a contract to purchase a Colorado house. The seller opted to terminate the contract and keep the buyer's earnest money. This is known as _______. Contract completion Liquidated damages Partial performance Specific performance

Liquidated damages

Earnest money retained by the seller in the event of a buyer default

Liquidated damages

William's tenant client has agreed to pay any part of the brokerage firm's fee that isn't paid by the listing brokerage firm, landlord, or sublandlord. Which of the following options will William select in Colorado's Exclusive Tenant Listing Contract to reflect this agreement? Listing Brokerage Firm, Landlord, or Sublandlord May Pay. Tenant is NOT Obligated to Pay. Listing Brokerage Firm, Landlord, or Sublandlord May Pay. Tenant IS Obligated to Pay. Not Applicable. Tenant Will Pay.

Listing Brokerage Firm, Landlord, or Sublandlord May Pay. Tenant IS Obligated to Pay.

Which of the following documents that contains a breakdown of the buyers' settlement costs can buyers except to receive shortly after submitting the loan application to the lender? Closing Disclosure HUD-1 statement Loan Estimate Mortgage Servicing Transfer Disclosure

Loan Estimate

What information is listed on the promissory note? Appraised value of property pledged as collateral Legal description of the collateral property Loan amount and schedule of repayment Title history of the collateral property

Loan amount and schedule of repayment

The buyer takes over the seller's existing loan payments. This requires lender approval, and the seller remains liable unless the lender releases the seller from responsibility.

Loan assumption

You're assisting a client in a commercial transaction where the buyer will assume the seller's loan, with the lender's permission. Which of these items will be needed (if it's charged by the lender) to properly complete Section 4.6, Assumption, of the Colorado commercial sales contract? Assumption review fee Contract fee Loan transfer fee Origination fee

Loan transfer fee

If you had a question about referral fees, and your employing broker told you that you need to follow the guidance found in CP-2, what would you do? Call the Division of Real Estate's licensee hotline and ask for extension CP-2. Find page CP-2 in the brokerage policies and procedures manual and read it carefully. Locate CP-2 in the commission position statements and read it carefully. Review the Real Estate Broker License Law, Part 2, sub-paragraph CP-2, to determine the law related to referral fees.

Locate CP-2 in the commission position statements and read it carefully.

Which of the following could be a sign of a plumbing problem? Copper pipes Cracks in the basement wall Low water pressure Rotting around the soffit

Low water pressure

Real estate brokers should act with honesty and integrity toward all consumers, but which of the following would a leasing agent owe only to a property owner whom the broker represents? Accountability Good faith Loyalty Proper disclosures

Loyalty

Which of these Colorado brokers is NOT required to maintain a place of business in the state? Fred, whose license is inactive. Jerry, who's an independent broker. Lynn, who's an out-of-state resident. Martha, who lives in a rural area of the state.

Lynn, who's an out-of-state resident. Non-resident Colorado brokers aren't required to have an office in Colorado, but all resident brokers licensed in Colorado must maintain a place of business in the state.

Emma is about to order a radon test for a premises that her tenant client is interested in leasing. Per the Exclusive Tenant Listing Contract, which of the following must Emma do before ordering the test? Arrange for her brokerage firm to advance the necessary funds to the tenant. Ask the tenant to pay for the test in advance with a certified check. Make arrangements to be present at the time the test is installed. Make sure the tenant agrees to pay for the cost of the radon test promptly when due.

Make sure the tenant agrees to pay for the cost of the radon test promptly when due. Per the Colorado exclusive tenant contract, brokers should only obtain or order services or products that the tenant has authorized and agreed to pay for promptly when due.

What does the public trustee in a deed of trust agreement in Colorado do once the loan has been paid in full? Manage the release of the deed of trust Oversee the judicial foreclosure proceeding Publish a public notice of lien removal on the property Transfer title to the lender

Manage the release of the deed of trust

Colorado fair housing laws include the seven federally protected classes of race, color, religion, national origin, sex, familial status, and disability, and add which group of protected classes? Age, political affiliation, sexual orientation Ancestry, medical status, military or veteran status Marital status, ancestry, creed, sexual orientation Pregnancy, HIV/AIDS status, health habits, political beliefs

Marital status, ancestry, creed, sexual orientation

How would you use the Agreement to Amend/Extend Contract form to delete a date-related provision from the original executed sales contract? Add an attachment to the amendment indicating which provisions should be deleted. Mark that item in the "Deleted" column of the amendment. On the amendment, strike through each provision you want to delete from the original sales contract. On the amendment, write "DEL" in the margin beside each provision you want to delete from the original sales contract.

Mark that item in the "Deleted" column of the amendment.

For which of the following properties would the Colorado Contract to Buy and Sell Real Estate (Land) be the best contract choice? Home on three acres in a subdivision Industrial building on a 4.7-acre lot Market farm on five acres Medical care complex covering 10 acres

Market farm on five acres

If a dispute arises regarding the CBS residential, the parties must first participate in this non-legal process with an impartial person, who helps to resolve the dispute informally and confidentially.

Mediation

Jameson has signed a purchase contract to buy Frederich's home. When Frederich defaults on the contract, the parties are obligated, under the terms of the CBS residential, to first pursue a non-legal remedy. What's this remedy called? Lawsuit for breach of contract Liquidated damages Mediation Specific performance

Mediation

Non-binding, non-legal attempt to resolve differences, using a paid mediator selected and paid for by the parties

Mediation

Which of these situations does the Americans with Disabilities Act address? Marcus, a property manager, routinely dismisses rental applications from families with children under the age of 18. Meridian Apartments provides a gym and pool area for residents, but it's not accessible to residents who use wheelchairs. Metro Agents hired an interpreter to assist Spanish-speaking clients with the real estate process. The Golden Gate senior housing center has no exercise or activity center for its residents.

Meridian Apartments provides a gym and pool area for residents, but it's not accessible to residents who use wheelchairs.

Milt owns property in Colorado, and his property tax owed is less than $25. Based on Milt's situation, which of the following statements is true? Milt can pay his property taxes in one payment or split the amount equally between two payments. Milt isn't required to pay property taxes. Milt must pay his property taxes in one payment by April 30. Milt's property tax payment is due by June 15.

Milt must pay his property taxes in one payment by April 30.

Sellers who provide financing for real property for more than five properties in a year qualify as consumer creditors under the U.C.C.C.

More-than-five rule

Kim and her husband Adam recently bought a home and financed the purchase with a bank loan. What type of lien do Kim and Adam have against the property? Judgment Mortgage Property tax Special assessment

Mortgage

Lien created on property used as collateral for a loan to purchase a home

Mortgage lien

Who are the parties to a mortgage agreement? Maker and payee Mortgagor and mortgagee Trustor, beneficiary, and trustee Vendee and vendor

Mortgagor and mortgagee The parties to a mortgage agreement are the mortgagor (the borrower, who grants the lien on the property) and the mortgagee (the lender).

Amy's brokerage firm has designated her to serve as the broker for a buyer client. What type of firm affiliation will Amy indicate in the Colorado Exclusive Right-to-Buy Listing Contract? Buyer's firm Multiple-person firm None One-person firm

Multiple-person firm

A consensus-based certification organization that approves the green building standards for residential properties

NGBS

A listing with a fixed, specified price in which the broker receives the entire amount above the fixed price; legal in Colorado, illegal in some other states due to the potential for abuse

Net listing

Which of the following is NOT considered an activity requiring a real estate license? Albert conducts weekly real estate auctions, and makes a good living at it. For a nominal fee, Tess shows a home for rent to a prospective tenant on behalf of the home's owner. Joan negotiates a lease on a new location for her place of work on behalf of her employer. Nick purchases a fixer-upper using a loan from his parents, puts some sweat-equity into it, and flips it.

Nick purchases a fixer-upper using a loan from his parents, puts some sweat-equity into it, and flips it.

Does a brokerage relationship between one broker in a firm and a client extend to the employing broker?

No

Does the IRS allow longer to identify a property or close on a replacement property to accommodate weekends or holidays?

No

Jana passed her broker licensing exam in Colorado. She'd planned to immediately submit her application for her broker's license, but she was in a car accident that upset all her plans. Now it's six months later. Will Jana have to retake her exam, or worse, retake her entire pre-licensing course? Jana will need to retake the licensing exam, but won't need to retake her pre-licensing education, which is good for one year. No, Jana has up to one year after passing her broker's exam to submit her license application. No, since Jana completed all the requirements prior to her license application, she can apply at any time without having to retake the exam or any of her pre-licensing education. Yes, since Jana didn't submit her application within 30 days of passing the exam, she'll have to retake all her education and pass the exam again.

No, Jana has up to one year after passing her broker's exam to submit her license application.

Jana passed her broker licensing exam in Colorado. She'd planned to immediately submit her application for her broker's license, but she was in a car accident that upset all her plans. Now it's six months later. Will Jana have to retake her exam, or worse, retake her entire pre-licensing course? Jana will need to retake the licensing exam, but won't need to retake her pre-licensing education, which is good for one year. No, Jana has up to one year after passing her broker's exam to submit her license application. No, since Jana completed all the requirements prior to her license application, she can apply at any time without having to retake the exam or any of her pre-licensing education. Yes, since Jana didn't submit her application within 30 days of passing the exam, she'll have to retake all her education and pass the exam again.

No, Jana has up to one year after passing her broker's exam to submit her license application. After passing the exam, Jana has one year to submit her application for a broker's license. If she fails to apply within that year, she will have to retake her pre-licensing education and pass her licensing exam again.

Jordan has just been issued an active broker's license. Is he ready to start practicing as an independent broker in Colorado? He sure is! No, as a new broker he's required to work under an employing broker for his first two years. No, independent brokers are required to complete additional education and pass another exam. Yes, as long as he met his pre-licensing education requirement by obtaining a real estate-related degree.

No, as a new broker he's required to work under an employing broker for his first two years.

Marcus is a real estate broker in Colorado who's been asked to serve one of his clients as agent under a power of attorney. Unfortunately, the market has taken a hit over the past year, and Marcus decides it would be in the principal's best interest to sell two properties. Is Marcus responsible should the principal take a financial loss? No, he was acting in the principal's best interests and in good faith. No, property sales are excluded from the agent's obligations to protect the principal's financial interests. Yes, even though he's acting in the principal's best interests, Marcus is responsible for any loss under Colorado law. Yes, Marcus should have risked further decreases in property value and waited until the market took a turn for the better.

No, he was acting in the principal's best interests and in good faith.

George has been practicing as a real estate broker in California for the last 15 years. He decides to move his family to Colorado. Since he has so much experience already, can he automatically be licensed as an employing broker in Colorado? No, but he can automatically obtain an independent broker's license. No, he'll need to complete the same process and requirements as any other candidate for initial licensure in Colorado. No, he'll need to take a 24-hour brokerage administration course and pass the state portion of the licensing exam. Yes; his California broker's license automatically qualifies him for licensure as an employing broker in Colorado.

No, he'll need to take a 24-hour brokerage administration course and pass the state portion of the licensing exam.

Marcia's had her license suspended. Dan's had his license revoked. Paula's license is on inactive status. Which licensee is allowed to practice real estate at this time? All these licensees may continue to practice until the three-year licensing period is complete. Marcia and Paula may, but Dan may not. None of these three may practice at this time. Paula may, but Marcia and Dan may not.

None of these three may practice at this time.

After you present a Definitions of Working Relationships disclosure, the consumer refuses to sign the document. What should you do? File a complaint with the real estate commission Note the date and consumer's refusal to sign and retain for your records Refer the consumer to another licensee Refuse to work with the consumer

Note the date and consumer's refusal to sign and retain for your records

The three basic security instruments used to finance a real estate purchase are the note with mortgage, the _____________, and the contract for deed. Finance deed Note with deed of trust Promissory note Security deed

Note with deed of trust

Louellen is about to take out a mortgage loan from her credit union. The contract includes the following information: Louellen is offering her house as consideration, and the credit union is offering $350,000; and Louellen will pay the loan back over a certain number of months at a certain rate. Both Louellen's signature and the credit union representative signed it. What, if anything, is this contract missing in order for it to be legally binding, according to the statute of frauds? Louellen's credit history needs to be included. Nothing is missing. The condition and size of the house needs to be included. The credit union's physical address needs to be included.

Nothing is missing.

Louellen is about to take out a mortgage loan from her credit union. The contract includes the following information: Louellen is offering her house as consideration, and the credit union is offering $350,000; and Louellen will pay the loan back over a certain number of months at a certain rate. Both Louellen's signature and the credit union representative signed it. What, if anything, is this contract missing in order for it to be legally binding, according to the statute of frauds? Louellen's credit history needs to be included. Nothing is missing. The condition and size of the house needs to be included. The credit union's physical address needs to be included.

Nothing is missing. All elements are present for this contract to be legally binding under the statute of frauds.

When a Colorado licensee has a compensation dispute with an employing broker, what, if anything, is the Colorado Real Estate Commission empowered to do? Nothing; this is beyond the scope of the commission's authority. The commission can censure the broker or brokerage until the dispute is resolved. The commission can hold a hearing to determine how much compensation is owed. The commission can suspend or revoke the employing broker's license.

Nothing; this is beyond the scope of the commission's authority.

A unilateral document providing information to one or both parties in a transaction

Notice

Why is it important for a buyer to know if an underground storage tank is present on a property? Buyers don't need to know. Older tanks may leak and contaminate the ground. The buyer may want to use the tank. The buyer will need to check if the tank is correctly sized.

Older tanks may leak and contaminate the ground.

When does the sales contract become a legally binding document? After an attorney has reviewed it Once the buyer and the seller have signed it, and their acceptance has been communicated to both parties Once the seller provides verbal agreement to the buyer's offer The moment the buyer signs the document and sends it to the seller

Once the buyer and the seller have signed it, and their acceptance has been communicated to both parties

The buyers and sellers sign their purchase contract. Under the terms of the contract, either party can provide written notice to terminate to the other party within the contracted deadline. Two days after that deadline passes, the buyers decide to back out of the contract. Which of the following applies here? As long as the buyers send written notice of termination to the sellers at least 48 hours before closing, the buyers won't be in default of the contract. Once the buyers missed the contracted deadline to terminate, they, in effect, waived their right to terminate. If the buyers terminated at this point, they'd be in default of the contract. Technically, the buyers should have sent their written notice of termination to the seller sooner, but nobody really pays attention to contracted deadlines, so the buyers shouldn't have any problems. The purchase contract is automatically terminated, and no one is considered in breach of the contract.

Once the buyers missed the contracted deadline to terminate, they, in effect, waived their right to terminate. If the buyers terminated at this point, they'd be in default of the contract.

Under the Dodd-Frank Act, which of these creates an exemption from the federal requirements regarding mortgage loans for the seller in a transaction where seller financing is used? Complete a Dodd-Frank Act compliance seminar Interest rate less than 15% Loan-to-value ratio no greater than 80% One property sale within a 12-month period

One property sale within a 12-month period

Under what circumstances may a representation agreement in Colorado be oral?

Only if the broker is acting as a transaction-broker

Who can complete the Seller's Property Disclosure form?

Only the seller

Under what circumstances may a commercial property seller in Colorado modify the terms of an existing lease after the property is under contract? No later than 20 days before closing Only with the buyer's written consent Only with the consent of at least 70% of existing tenants Within 10 days of sales contract signing

Only with the buyer's written consent

James, a seller, signed a listing agreement that allowed him to contract with multiple agents but only pay a commission to the agent who located a buyer. This type of listing agreement is called ______. Exclusive agency Exclusive right to sell Open Seller's choice

Open

A property owner decides she'd like as many brokers as possible trying to find tenants for her duplex. Which contract form will enable this? Contract to Buy and Sell Real Estate, Residential Exclusive Agency Addendum Exclusive Right-to-Lease Listing Contract Open Listing Addendum

Open Listing Addendum

An agreement between an owner and many brokers where only the broker procuring the buyer earns a commission

Open listing

Margo is the potential buyer of the property in an option contract. Margo is the ______. Optee Opter Optionee Optionor

Optionee

An agent may not _____________ the wishes and preferences of the principal. Fulfill Honor Override Uphold

Override

The Colorado Seller's Property Disclosure (Land) form covers crops, livestock, leases, noxious weeds, and other land disclosures, such as _______. Businesses run on the property Participation in conservation programs Presence of wildlife Use licenses granted by the seller

Participation in conservation programs

A licensee with a broker's license from another state and more than two years of experience must do what to work as a broker in Colorado? Nothing, since the license is transferable Pass both portions of the broker's exam Pass the state portion of the broker's exam Pass the state portion of the broker's exam and take 72 hours of education

Pass the state portion of the broker's exam

The Colorado Real Estate Commission doesn't have any legal standing to intervene in ________. Complaints against licensees License law violations License renewals Payment disputes between brokers

Payment disputes between brokers

Which type of compensation is prohibited without prior written consent from the seller? A combination of hourly fees plus percentage of sales price A retainer fee to cover broker out-of-pocket expenses Payment from a cooperating broker Payment from a third party

Payment from a third party

How are leasing commissions usually structured?

Percentage of the gross rent, or a multiple of the square footage being leased

How is personal property conveyed in a Colorado sales contract? If it's on the property, personal property automatically conveys when the transaction is closed. Personal property must convey via a bill of sale or other legal instrument. The title to any personal property is legally conveyed by listing the item under the Inclusions section of the Colorado sales contract. Via Section 2.5.2, Personal Property - Conveyance.

Personal property must convey via a bill of sale or other legal instrument. A bill of sale or other legal conveyance instrument is required when conveying personal property. Personal property isn't conveyed through the Colorado real estate contract.

A visual inspection and research of a property that assesses the known presence of toxic chemicals and how they've been stored and handled is known as a _______. Environmental Property Analysis Phase I Environmental Site Assessment Phase II Environmental Site Assessment Preliminary Assessment for Toxic or Chemical Hazards

Phase I Environmental Site Assessment

In Colorado, if you're faced with copying a lengthy legal description into a sales contract, what can you do? Alter the description but check with the seller first Photocopy it, label it, attach it to the sales contract, and reference the attachment in the legal description of the contract Reference the number of the recorded document where the legal description can be found Shorten it by abbreviating certain words and phrases

Photocopy it, label it, attach it to the sales contract, and reference the attachment in the legal description of the contract

Which of the following could indicate an underground storage tank is present? Discolored soil Newer residential development Pipe or vent sticking out of the ground Steep drop off on the property

Pipe or vent sticking out of the ground

Per Colorado's Mortgage Broker Registration Act, mortgage brokers are required to do which of the following? Complete 20 hours of continuing education Post a surety bond Take a lie detector test as part of registering Take out a private insurance policy of $100,000

Post a surety bond

The Colorado Seller's Property Disclosure (Land) form includes disclosure for participation in conservation programs. Why must this be disclosed? Cost to the surrounding neighborhood Potential use restrictions Special assessments Use of herbicides

Potential use restrictions

A legal document granting legal rights from one person (the principal) to another (the agent)

Power of attorney

What's the best course of action when a Colorado seller will not be able to meet the inspection resolution deadline stated in the contract? Call the buyer's broker and ask for an extension of time. Don't worry, only the objection deadlines are important. Draft an inspection resolution and present it anyway. Prepare and present an Agreement to Amend/Extend the contract.

Prepare and present an Agreement to Amend/Extend the contract.

The historical case of Conway-Bogue affected the way in which real estate brokers in Colorado could _______________________________. Obtain a real estate license Pay commission checks Prepare legal documents Show homes for sale

Prepare legal documents

Sandra enters into a contract to sell her home to Paul. Under the statute of frauds, in order to be legally enforceable, the written contract must name the contracting parties, identify the subject matter of the contract, and ______. Be for a legal purpose Be signed by two or more attorneys Include a certain amount of financial consideration Present the essential terms and conditions of the contract

Present the essential terms and conditions of the contract

A party in a transaction (e.g., the buyer, seller, tenant or property owner/landlord)

Principal

Colorado uses this method to determine water rights, which can be best described as "first in time, first in right."

Prior appropriation

What type of water rights does Colorado utilize? Post-appropriation Prior-appropriation Prior-riparian Riparian

Prior-appropriation

Lola, an Air Force veteran, has applied for a VA loan to finance the purchase of a property. What problems might she encounter in the approval process with this type of loan? Hefty down payment requirements High interest rates Mortgage insurance requirement Prohibition against buyer-paid repairs

Prohibition against buyer-paid repairs

Attaches to security instrument (mortgage or deed of trust) and describes repayment terms

Promissory note

In a financing agreement, which document explains who owes money to whom, how much, and how it will be repaid? Contract for deed Deed of trust Mortgage Promissory note

Promissory note

Which of the following tasks might be performed by a landlord's agent, but not by a transaction-broker, per the Colorado Brokerage Disclosure to Tenant form? Disclose any known adverse material facts to the landlord Prepare and convey written offers Promote the landlord's interest with the utmost good faith, loyalty, and fidelity Use reasonable skill and care

Promote the landlord's interest with the utmost good faith, loyalty, and fidelity

Dottie is a tenant's agent. Per the terms of the Colorado Exclusive Tenant Listing Contract, which of the following duties must Dottie perform, in addition to the uniform duties both tenant's agents and transaction-brokers must perform? Disclose adverse material facts to the tenant that are actually known to her. Keep the tenant fully informed with what's happening with the transaction. Present all offers to and from the tenant in a timely manner. Promote the tenant's interest with the utmost good faith, loyalty, and fidelity.

Promote the tenant's interest with the utmost good faith, loyalty, and fidelity.

One of the five primary reasons for complaints in a real estate transaction is ___________. Broker price opinions Disclosed dual agency situations Earnest money deposited in trust accounts Property disclosures

Property disclosures

Lien priority in Colorado

Property tax liens, super liens, and deed of trust/first mortgages (mechanics liens would come ahead of a first mortgage if it was filed first)

The fair apportionment of expenses between the buyer and seller as of the closing date

Proration

The Colorado Real Estate Commission investigates possible violations of license law in order to ______. Protect the interests of the state Protect the public Protect the real estate industry Protect the rights of licensees

Protect the public

A clause that prevents buyers/tenants from reaching an agreement with a seller/landlord on a property and then discarding their brokers so that neither party has to pay a broker commission

Protection clause

Sonia, a broker, is meeting with Deacon, a prospective seller client, for the first time. Deacon's never sold or bought a house before, and he's uncertain what an agent does and how she'd be paid. What is Sonia required to do for Deacon to ensure he understands his options regarding their working relationship? Describe her brokerage's normal commission. Explain the various types of agency that exist. Provide him with the Brokerage Notice to Parties. Provide him with the Definitions of Working Relationships.

Provide him with the Definitions of Working Relationships.

Licensee Andrew has entered into a written agency agreement to represent the seller of an REO. What must Andrew do in this situation? Complete the Seller's Property Disclosure form on the seller's behalf, since the seller is a bank. Notify the foreclosure court of the property's list price. Provide potential buyers with a completed Brokerage Duties Disclosure to Buyer form. Provide the seller with a completed Brokerage Duties Disclosure to Seller form.

Provide the seller with a completed Brokerage Duties Disclosure to Seller form. Because Andrew has signed a listing agreement with the seller of an REO, Colorado requires him to include the Brokerage Duties Disclosure to Seller form with the agreement.

In Colorado, all deeds of trust used for real estate loans are expected to name the county's public trustee as the party holding title to the property

Public trustee

A person or entity that facilitates a 1031 exchange by transferring the relinquished property and acquiring a replacement property in such a way that no funds change hands with the exchanger

Qualified intermediary (QI)

Homes that are built to green or ENERGY STAR® standards are more comfortable due to their construction. Which characteristic of green homes does this describe? Affordability Quality Responsibility Trustworthiness

Quality

The Colorado Real Estate Commission prohibits referral fees to and from settlement service providers. If the transaction involves federal mortgage loans, which federal law also governs referral fees? Consumer Protection Act Equal Credit Opportunity Act RELRA RESPA

RESPA

Which of these prohibits kickback payments and other fees that drive up consumer's settlement costs? Clayton Act Fair Housing Act RESPA Section 8 Sherman Act

RESPA Section 8

A colorless, odorless, radioactive gas

Radon

Which body makes policy decisions affecting real estate license law? Department of Personnel Division of Real Estate Real Estate Commission Regulation Commission

Real Estate Commission

A sale or transfer within a housing cooperative involves the transfer of a share or stock in the cooperative together with a proprietary lease. Therefore, this transfer is considered ____________. Plottage Real estate Security Subdividing

Real estate

A sale or transfer within a housing cooperative involves the transfer of a share or stock in the cooperative together with a proprietary lease. Therefore, this transfer is considered ____________. Plottage Real estate Security Subdividing

Real estate The transfer of a stock or cooperative share is considered real estate in Colorado.

Doug owns property in Colorado. He hasn't paid his property taxes in more than a year, he's behind in his mortgage payment, and he's received another notice from the HOA about dues he hasn't paid. If the bank were to foreclose on Doug's property, which of the following liens would have the highest priority? Association lien Deed of trust/first mortgage Real estate tax liens Super liens

Real estate tax liens

According to UETA, an electronic signature is defined as "an electronic sound, symbol, or process attached to or logically associated with a(n) _________ and executed or adopted by a person with the intent to sign." Computer Email Real estate broker Record

Record

Which of these property owners is eligible to take advantage of a 1031 tax-deferred exchange? Ann owns a single-family home, but rents it out to a coworker while she's on a two-year military tour. Chanel sells an investment property. A year later, she finds an almost identical investment property to purchase, and does so. Reggie sells an apartment complex and purchases a new complex a month later in a different part of the city. Sigmund sells his single-family home and purchases a new home for his family to reside in.

Reggie sells an apartment complex and purchases a new complex a month later in a different part of the city.

What's codified and often carries the force of law without being a law? Bill Position statement Regulation Statute

Regulation

What would be a good way to make an older home greener that would be simple and cost effective? Plant more native plants in the yard Reduce the number of windows in the house Replace the structure with sustainably sourced materials Replace water fixtures with low flow versions

Replace water fixtures with low flow versions

If a buyer intends to use part of his commercial property purchase as a residence, what form should you attach to the sales contract? Change of Status Addendum Land Conversion Addendum Residential Addendum Short Sale Addendum

Residential Addendum

A tax-deferred exchange in which the exchanger closes on the replacement property before closing on the relinquished property

Reverse exchange

Cracks, holes, or rotten areas on a soffit are common ______ issues. Chimney Foundation Roof Window

Roof A soffit is a roof component. Buyers need to know about issues with the roof prior to buying a property.

Requires Colorado licensed real estate brokers to use standard commission approved forms

Rule F

What type of property is most likely to need a Source of Water Addendum attached to the sales contract? Industrial Rural Suburban Urban

Rural

Offer to purchase, sales agreement, contract of purchase and sale, and purchase agreement are other names for which of the following? Buyer representation agreement Listing agreement Promissory note Sales contract

Sales contract

What does Colorado's statute of frauds say about real estate contracts?

Sales contracts are void unless they're in writing and signed by sellers.

The Colorado land sales contract includes two provisions that aren't found in the residential or commercial contracts. One of these is Section 2.8, Growing Crops. The other provision also addresses crops. Which of these is found in the land sales contract? Section 10.6.1.15, Growing Crops Records Section 19.6, Risk of Loss - Growing Crops Section 2.9, Growing Crops - Exclusions Section 6.5, Crop Appraisal

Section 19.6, Risk of Loss - Growing Crops

Under which section of the Colorado land sales contract will you record an agreement between the parties to split the value of crops harvested the week after closing? Section 2.5.1, Inclusions Section 2.8, Growing Crops Section 30, Additional Provisions Section 4.2, Seller Concessions

Section 2.8, Growing Crops

Brenda is working with seller Lisa as an agent and with seller George in another transaction as his transaction-broker. Which duty does she owe Lisa that she doesn't owe to George? Account in a timely manner for any money or property received from the seller. Keep the seller fully informed regarding the transaction. Present all offers to the seller. Seek a price and terms that are acceptable to the seller.

Seek a price and terms that are acceptable to the seller.

Who must fill out the optional Green Disclosure form in order to list a property as a green home on the MLS? Buyer Certified Home Inspector Licensee Seller

Seller

Which party is responsible for assuring the seller is released from liability for a loan that a buyer assumes as part of a Colorado commercial sale transaction? Buyer Lender Seller Seller's broker

Seller The seller is responsible for seeking release from loan liability when entering into an assumption agreement in Colorado.

What form should a foreclosure seller sign to acknowledge that the buyer won't assume responsibility for liens against the property? Foreclosure Acknowledgement Homeowner Warning Notice Notice of Cancellation Seller Warning - Equity Skimming

Seller Warning - Equity Skimming The Seller Warning - Equity Skimming form notifies the seller that the buyer won't assume responsibility for paying any liens against the property.

Money the seller credits to the buyer at closing to help pay any lender-allowed buyer's fee or cost

Seller concessions

A short-term lease agreement whereby the seller of a property remains on the property after closing, paying rent to the buyer

Seller rent-back

What's it called when a seller keeps possession of a property even after the closing date and pays a rental fee to the buyer? Buyer rent-back Early possession Pre-closing occupancy Seller rent-back

Seller rent-back

Which document contains the disclosure of a property's status as part of a common interest community association? Estoppel Statement Green Disclosure Lead Disclosure Seller's Property Disclosure

Seller's Property Disclosure

A broker who represents and advocates for the seller

Seller's agent

Milton, a broker from a one-person firm, is assisting in the sale of property that's based on a non-CREC-approved listing agreement. Milton will perform both uniform and additional duties for the seller. When Milton and the seller complete the Colorado Brokerage Duties Disclosure to Seller form, what will Milton indicate that his working relationship is with the seller? Buyer's agent Independent contractor Seller's agent Transaction-broker

Seller's agent

Broker who represents the seller (or landlord) in a real estate transaction

Seller's agent (landlord's agent)

Sylvia is a licensee who's completing a Colorado commercial real estate sales contract for a 10-unit apartment building. Because the buyer is planning to use _____________, Sylvia requests that an attorney complete the financing provisions of the contract in order to avoid violating the law. A jumbo loan A new loan An FHA loan Seller-provided financing

Seller-provided financing

If the commission investigates and finds that a formal disciplinary proceeding isn't warranted, what's a possible action? Assign ethics-related readings to the licensee Fine the licensee to recuperate investigative costs Limit the number of transactions a licensee can perform Send a letter of admonishment to the licensee

Send a letter of admonishment to the licensee

No referral fees may be accepted between ____________ providers.

Settlement service

CREC has asked licensee Millie to produce her records for a particular transaction that closed 18 months ago. Millie has searched frantically, but is unable to find all the requested documents by CREC's deadline. What's going to happen to Millie? Nothing; she's only required to maintain transactional records for one year. She may be disciplined by CREC for failure to submit the requested documents. She may be required by law to refund her commission to the seller in the transaction. She may face a jail sentence since this is a serious violation of license law and is considered a felony.

She may be disciplined by CREC for failure to submit the requested documents.

Annie, a real estate licensee in Colorado, copied the legal description into the sales contract incorrectly. The mistake wasn't caught until the buyers realized a week after closing that they held title to wrong property. What might happen to Annie as a consequence of her mistake? Her real estate license may be suspended for a year. Nothing. The transaction has been completed. She may be held liable for damages. She may be required to pay a fine and serve three months in jail.

She may be held liable for damages.

Chelsea is a broker who lives in Utah and who runs a brokerage there. She's also licensed in several states, including Colorado. Which of these Colorado licensing requirements does NOT apply to Chelsea? For Colorado transactions, she must retain transactional records for four years. She must maintain an errors and omissions insurance policy. She must maintain a place of business in Colorado. She must renew her Colorado license every three years.

She must maintain a place of business in Colorado.

Regina is a Colorado broker working with Jackie as a seller's agent. She's also been working with the Smiths as their transaction-broker in another transaction. What's true about the duties she owes to Jackie and to the Smiths? She'll promote the interests of all parties with the utmost good faith, loyalty, and fidelity. She'll seek the best price and terms for Jackie's property, but she'll advocate only for the Smiths. She owes them all reasonable skill and care, but she'll advocate only for Jackie. She's not allowed to disclose Jackie's confidential information, and she's not allowed to receive confidential information from the Smiths.

She owes them all reasonable skill and care, but she'll advocate only for Jackie. As Jackie's agent, Regina owes her additional duties that include promoting Jackie's interests and seeking the best price and terms. Regina doesn't owe those duties to the Smiths, but she does owe them uniform duties, including reasonable skill and care.

A sale of real estate in which the sale proceeds fall short of the balance owed on the property's mortgage loan

Short sale

What should the sellers do if they receive an offer and want to accept the offer exactly as it's written? Check "countered" and initial it. Check "rejected" and initial it. Give the buyers their verbal agreement. Sign the offer.

Sign the offer.

Sometimes when a buyer can't qualify for a loan, the property seller drops the price and accepts a second mortgage without disclosing it to the original lender. What is this form of mortgage fraud known as? Inflated appraisal Property flipping Silent second Straw buyers

Silent second

A tax-deferred exchange in which the closing for the relinquished and replacement property occur simultaneously or almost simultaneously

Simultaneous exchange

A Colorado seller received an offer and sends a counterproposal that increases the purchase price using the Counterproposal form. What's true about how the form is used in this situation? Since only the purchase price is being amended, the dates and deadlines table may be omitted. The Counterproposal form extinguishes the original offer terms. The Counterproposal form is only used for amendments to dates and deadlines, so you'll need to fill out a new CBS with the amended purchase price. The seller must sign the contract with the buyer's original offer and send that back to the buyer with the Counterproposal form.

Since only the purchase price is being amended, the dates and deadlines table may be omitted. If the dates and deadlines table won't be used, it's permissible to omit it.

Jim just received an offer on his property in Vail. In the Colorado Contract to Buy and Sell Real Estate (Residential), the mailing address was the only thing listed under "Property." Which of the following is true of this situation? Since the buyer didn't provide the legal description, Jim should insert it under "Property." The legal description should be written instead of the mailing address under "Property." This is acceptable. This is only acceptable if Jim okays it.

Since the buyer didn't provide the legal description, Jim should insert it under "Property." In this Colorado sales contract, both the property's legal description and its mailing address must be provided. An offer from a seller may include the note "To be inserted by listing agent" if the buyer's agent doesn't have the legal description.

A licensee acts as an agent for only one party in a transaction, either a buyer, seller, landlord, or tenant

Single agent

In Colorado, which type of broker performs additional duties? Non-agent Single agent Transaction-broker Uniform agent

Single agent

Represents one client

Single agent

Used when a broker has a specific buyer for a property that isn't already listed (listing is good for a short time, and there's no holdover clause)

Single party listing

In Colorado, for how many years do judgment liens stay attached to real property? Eight Four Six Two

Six

Which one of the following could be a clue that a property was formerly a waste disposal site? Birds constantly on the property Plate covering an oil fill area Scorch marks on trees surrounding the area Soft spots, mounds, and discolored soil

Soft spots, mounds, and discolored soil

Radon is found in well water and where else? Ceiling tiles Insulation Plastics Soil

Soil

When a real estate transaction involves vacant land, which of these statements about the Colorado Contract to Buy and Sell Real Estate (Land) is true? Some contract provisions may or may not be required, depending on the property itself and the buyer's intended use of it. The Due Diligence sections of the contract won't apply. The Inclusions and Exclusions sections may be omitted. The law requires the buyer to order a Phase I Environmental Site Assessment (ESA).

Some contract provisions may or may not be required, depending on the property itself and the buyer's intended use of it.

When working with a client on a real estate sale, a real estate licensee is usually acting as which type of agent? Designated General Special Universal

Special Real estate licensees most often serve as special or specific agents. They have a limited scope of authority when compared to a general agent.

An agent whose scope of authority is limited to a specific area

Special agent

A levy placed against real property to help fund the cost of improvements in the area

Special assessment

Which of the following liens results from the government placing a levy against real property to help fund the cost of a specific improvement? Judgment Property tax Special assessment State tax

Special assessment

Legal enforcement of the terms of the contract (in the event of buyer default, may be pursued by the seller in lieu of liquidated damages; in the event of a seller default, the buyer's remedy in against the seller)

Specific performance

Where will you find official documentation about the licensing of real estate professionals? Codes of conduct Ordinances State Laws and regulations Zoning codes

State Laws and regulations

If property owners in Colorado fail to pay their state income taxes, which lien might be applied to their property? Mechanic's lien Property tax Special assessment State tax

State tax

A form required to be completed when the property being transferred is subject to a homeowners association

Status letter and record change

Janet's been a real estate broker for 12 years, but circumstances currently prevent her from continuing to work. She expects to return to real estate eventually, but in the meantime, she asks the real estate commission to make her license inactive. Which of these actions will she need to take as a result? Advertise only those properties she currently has listed and not under contract, until the listing terminates. Allow her current real estate advertisements to continue for 30 days, at which time all advertising must cease. Include a notice of "broker inactivity" in all her real estate advertisements. Stop all her real estate advertising immediately.

Stop all her real estate advertising immediately.

Carter was looking to buy a house. He hired Sheldon as his buyer's agent. Sheldon helped Carter negotiate an offer with great terms. Now that Carter and the seller have a signed contract, Sheldon can ______ without neglecting his duty as Carter's agent. Ignore Carter's request to ask the seller for a change to the agreed-upon closing date Inform the seller that Carter was willing to offer a higher price than was accepted Stop searching for properties that meet Carter's criteria Wait, at the seller's request, to inform Carter about the delay in making the repairs the seller promised to make

Stop searching for properties that meet Carter's criteria

What items must a seller disclose about the walls and floors on the Seller's Property Disclosure form? Construction type (sheetrock, lathe, or other) Paint color Structural defects Type of wallpaper

Structural defects

Stuart is an employing broker. One of his buyer clients wants to make an offer on a property listed by one of Stuart's employed brokers, Laura. What's true about this situation? Because Laura is supervised by Stuart, this is considered a dual agency situation, and both Laura and Stuart must change their status to transaction brokerage. Stuart isn't allowed to supervise a designated agent who's representing the opposite side of a transaction from Stuart's client. Stuart is required by law to designate another employed broker from his company to take over representation of his buyer client. Stuart may legally appoint another agent to supervise Laura during this transaction, in order to avoid a conflict of interest.

Stuart may legally appoint another agent to supervise Laura during this transaction, in order to avoid a conflict of interest.

Works under another agent with the principal's permission to perform some agency duties

Sub-agent

The act of dividing land into pieces that are easier to sell or otherwise develop

Subdivision

The Division of Real Estate enforces licensing law for real estate brokers, appraisers, mortgage loan originators, and what other professional group? General contractors Home inspectors Landscape architects Subdivision developers

Subdivision developers The division enforces licensing law for subdivision developers, as well as community association managers and conservation easement holders.

Despite several notifications, Nina has failed to pay her HOA fees month after month. Now the association has started foreclosure action. What type of lien does Nina have against her property? Judgment Property tax Special assessment Super

Super

Of the following liens, which has the highest priority in Colorado? Association lien Deed of trust/first mortgage Mechanic's lien Super lien

Super lien Colorado law stipulates lien priority. The top three liens in priority are real estate tax liens, super liens, and deed of trust/first mortgages.

Angela lives in a subdivision in Colorado that has a very active HOA. Angela pays her property taxes faithfully twice a year but she's behind on her loan payment and HOA assessment fees. If the bank were to foreclose on Angela's property, which of the following liens would have the highest priority? Association lien Deed of trust/first mortgage Real estate tax liens Super liens

Super liens Colorado law stipulates lien priority. The top three liens in priority are real estate tax liens, super liens, and deed of trust/first mortgages.

Also known as a super lien, gives HOA liens priority over first mortgages or deeds of trust

Super priority lien

Professional on-site measurement of lot lines, dimensions, and elements of a property

Survey

This blueprint or map shows measurements, boundaries, and area of a property. The measurements are confirmed with a physical property inspection. This is sometimes required by lenders to ensure that no encroachments exist.

Survey

A like-kind exchange, or 1031 exchange, is also referred to as a ______. Incentive exchange One-to-one exchange Property swap Tax-deferred exchange

Tax-deferred exchange

Transfer of property held for investment purposes in exchange a for like-kind property in a transaction that meets the requirements of Section 1031 of the Internal Revenue Code

Tax-deferred exchange

Mike's tenant clients have agreed to pay the brokerage firm's fee. Which of the following options will Mike select in Colorado's Exclusive Tenant Listing Contract to reflect this agreement? Listing Brokerage Firm, Landlord, or Sublandlord May Pay. Tenant is NOT Obligated to Pay. Listing Brokerage Firm, Landlord, or Sublandlord May Pay. Tenant IS Obligated to Pay. Not Applicable. Tenant Will Pay.

Tenant Will Pay. Mike will select the "Tenant Will Pay." In this situation, the tenants will pay the brokerage firm's entire fee. No part of the fee will be paid by the listing brokerage firm, landlord, or sublandlord.

A document in which the tenant certifies that certain facts about the tenancy (the lease's beginning and ending dates, security deposit, etc.) are true

Tenant estoppel statement

Documents current tenants' lease terms, and also gives tenants the opportunity to air grievances the seller may have omitted or may not be aware of

Tenant estoppel statement

All buyer an tenant representation agreements must have a definite _________ date.

Termination

What notification does the Licensee Buy-Out Addendum provide to the seller? That the licensee may use the commission earned from the sale as part of the purchase price That the seller has the right to cancel the contract That the seller will have access to commission rebates when the buyer is a licensee That transactions with licensees may lead to greater seller profit

That the seller has the right to cancel the contract The Licensee Buy-Out Addendum gives notice to the seller of the differences when contracting with a licensed broker, and that the seller may cancel the contract.

Which of the following statements is true regarding seller assumption of a loan for a commercial property in Colorado? Colorado law doesn't allow assumption of a loan for a commercial property. The Colorado Contract to Buy and Sell Real Estate (Commercial) doesn't include a standard provision for assumption, so a financing addendum must be attached. The Colorado Contract to Buy and Sell Real Estate (Commercial) has a standard provision for assumption, which provides fillable blanks to describe loan terms. The Colorado sales contract provision regarding assumptions creates a release of liability for the seller.

The Colorado Contract to Buy and Sell Real Estate (Commercial) has a standard provision for assumption, which provides fillable blanks to describe loan terms.

Which entity makes standard forms available for use by Colorado real estate brokers? The Colorado Association of Real Estate Boards The Colorado Real Estate Commission The Colorado Supreme Court The Denver Bar Association

The Colorado Real Estate Commission

If a broker commits a crime or violates real estate license law, who has the authority to revoke the broker's license? An administrative law judge The broker's client The broker's employing broker The Colorado Real Estate Commission

The Colorado Real Estate Commission A broker's license may only be revoked by the Colorado Real Estate Commission. Employing brokers may terminate an employed brokers contract, but don't have the power to revoke a license.

What was the outcome in the case of Guaranty Title Co. vs. Denver Bar Association? The Colorado Supreme Court affirmed that Guaranty Title Co. was in violation of the unlawful practice of law. The Colorado Supreme Court found that Guaranty Title Co. didn't violate license law by engaging in activities that required a real estate license. The Colorado Supreme Court found that Guaranty Title Co. was in violation of real estate license law by engaging in activities that required a real estate license. The Colorado Supreme Court found that Guaranty Title Co. wasn't in violation of the unlawful practice of law.

The Colorado Supreme Court affirmed that Guaranty Title Co. was in violation of the unlawful practice of law.

In order to execute a Counterproposal, what must the parties sign? Both the original sales contract and the Counterproposal form The Counterproposal form The original Contract to Buy and Sell Real Estate The Price Change Amendment

The Counterproposal form

The entities that administer license law in Colorado

The Division of Real Estate and the Colorado Real Estate Commission

The directives of the Colorado Real Estate Commission are carried out by ________. An administrative law judge Chief commission clerk The Division of Real Estate director The Secretary of Commerce

The Division of Real Estate director The commission's directives are carried out by the director of the Division of Real Estate.

Which government agency is one of the primary enforcers of green regulations on a national scale? The Commission on Environmental Quality The Environmental Protection Agency The National Security Agency The U.S. Department of Energy

The Environmental Protection Agency

Which two mandated forms are used to establish buyer agency and tenant agency relationships in Colorado?

The Exclusive Right-to-Buy Listing Contract and the Exclusive Tenant Listing Contract

The Hamiltons own property in Colorado, and their property tax bill is more than $25. Based on this information, which of the following statements is true? The Hamiltons can pay their property taxes in one payment or split the amount equally between two payments. The Hamiltons must pay their property taxes in one payment by June 15. The Hamiltons must pay their property taxes in three equal payments. The Hamiltons must pay their property taxes in two payments: one on February 15 and one on August 1.

The Hamiltons can pay their property taxes in one payment or split the amount equally between two payments.

Connie and her husband Danny are buying property in a rural part of the state. Because they have applied for a loan to finance the purchase, the lender required them to have an ILC done, which they did. Now the lender wants a full survey done. Why? After they applied for the loan, Connie and Danny purchased a new vehicle on credit. Full surveys are required when a mortgage loan is involved. It's standard practice for lenders to require both. The ILC revealed potential issues with the property boundaries or encroachments.

The ILC revealed potential issues with the property boundaries or encroachments.

Per the statute of frauds, which of the following agreements does NOT have to be written down in order to be legally binding? Sierra sells her car to her cousin for $2,500. Sloane agrees to pay the $400 in credit card debt that her sister owes. The Lees rent out their basement to some college students for three months. Tyrone and Alaya are getting married.

The Lees rent out their basement to some college students for three months. While it's a good idea to get these kinds of agreements in writing anyway, an agreement to rent or lease property for less than a year doesn't have to be in writing to be enforceable.

A CREC disclosure containing sections for crops, live stock, leases, noxious weeds, and other land disclosures, like such as participation in conservation programs

The Seller's Property Disclosure form for All Types of Properties

Which law defines subdivisions and developer requirements in Colorado? Colorado Subdividing and Registration Act Developers of Subdivisions and Property Ownership Act The Subdivision Act of Colorado The Subdivision Developer's Act

The Subdivision Developer's Act

Apparent authority is created through __________. Agency disclosure Express written agreement Oral agreement The actions of the parties

The actions of the parties

Colorado broker Ron has signed brokerage agreements, in different transactions, to represent seller Tiffany, buyer Daryl, and landlord Casey. Ron works in a multiple-person brokerage called Winning Realty, owned by employing broker Adelaide. Which of these describes the agency relationship created by these agreements? The agency relationship is between Adelaide, the employing broker, and each of the principals. The agency relationship is between all brokers employed at Winning Realty and each of the principals. The agency relationship is between Ron and each of the principals. The agency relationship is between the firm, Winning Realty, and each of the principals

The agency relationship is between Ron and each of the principals.

What's one of the required elements of a valid option contract? A range of sale prices for the property from which the optionee can choose The amount of consideration the optionee is paying the optionor The optionee's promise to buy the property The optionor's verbal assurance that the optionor won't sell the property to anyone else during the option period

The amount of consideration the optionee is paying the optionor

What's a promissory note? A legally binding document that creates a lien on a piece of property A legally binding document that transfers title from one party to another The borrower's promise to repay another party under specified terms The right to keep possession of property belonging to another person until a debt owed by that person is discharged

The borrower's promise to repay another party under specified terms

Per the buyer and tenant broker agreements, to whom must the buyer or tenant refer all contract negotiations and communications?

The broker

Who must sign the Listing Contract Amend-Extend form? The broker and the client The buyer and seller The seller The seller and broker

The broker and the client

When a broker is asked to assist both the buyer and seller in a transaction, if the seller doesn't want the broker to become a transaction-broker, what alternative is most likely to be offered by the broker? The broker can refer the buyer to another brokerage. The broker can refer the seller to another brokerage. The broker can treat the buyer as a customer. The seller can request another broker.

The broker can treat the buyer as a customer.

What's the listing broker's responsibility relative to the property's material defects? The broker has no responsibility relative to material defects. The broker must complete all property disclosure forms. The broker must disclose any known material defects to the buyer. The broker must disclose any material conditions, but only if asked.

The broker must disclose any known material defects to the buyer.

Before a broker who has a signed Exclusive Right-to-Buy Listing Contract can accept compensation from a third party to the transaction, what's required? Brokers aren't allowed to accept any third-party compensation. The broker must have the brokerage firm's approval. The broker must have the buyer's written consent. The broker's buyer must sign an agreement with the third party.

The broker must have the buyer's written consent.

What relationship must a broker in Colorado have with a client in order to complete approved legal forms related to a real estate transaction? The broker must also be the client's attorney. The broker must be immediate family. The broker must represent the client without any brokerage firm supervision. The broker or broker's firm must be directly connected as the broker of the transaction.

The broker or broker's firm must be directly connected as the broker of the transaction.

What's true about alternatives to physical delivery of contract documents and notices? The brokerage may provide documents electronically, via email, link, or facsimile. The broker decides how documents will be delivered. The law prohibits electronic document delivery. The tenant decides how documents will be delivered.

The brokerage may provide documents electronically, via email, link, or facsimile.

Bart, a broker at a multiple-person firm, enters into an agency agreement with a buyer. Which of the following statements about the brokerage relationship is true? The brokerage relationship includes Bart, the buyer, and Bart's broker. The brokerage relationship is between Bart and Bart's broker. The brokerage relationship is between Bart and the buyer. The brokerage relationship is between Bart's broker and the buyer.

The brokerage relationship is between Bart and the buyer.

Who's protected by a financing contingency in a sales agreement? The buyer The listing agent The loan officer The seller

The buyer

Who must sign the Agreement to Amend/Extend Contract form? The broker and lender The buyer and seller The seller The seller and broker

The buyer and seller

In the CBS residential contract, which of the following parties is responsible for choosing the title insurance company? The buyer The buyer or seller The lender The seller

The buyer or seller

A buyer is obtaining a VA loan to purchase a property. Under the terms of the Colorado Contract to Buy and Sell Real Estate (Residential), which of the following parties must provide the closing company with all required loan documents and financial information about that loan? The buyer The buyer's agent The buyer's attorney The buyer's lender

The buyer's lender

Per the Colorado exclusive buyer contract, what's required before broker or brokerage firm can accept compensation in connection with the property from a third party?

The buyer's written consent

Josey has presented the Colorado Change of Status form to the landlord and the tenant, and the landlord and tenant have signed the disclosure. Based on this information, which of the following statements is true? Going forward, Josey must act as a transaction-broker for any other transactions involving this landlord or this tenant. Josey must be an agent for one of the parties and a transaction-broker for the other. Josey's brokerage firm will designate two brokers to take her place in the transaction. The change of agency relationship between Josey and the landlord and tenant is for this transaction only.

The change of agency relationship between Josey and the landlord and tenant is for this transaction only.

Which of the following statements best describes the 200% rule as it relates to tax-deferred exchanges? The capital gains realized from the property sale can't be more than 200% of the original purchase price. The capital gains realized from the property sale can't be more than 200% of the sale price. The combined fair market value of the property (or properties) selected can't be more than 200% of the relinquished property. The fair market value of the relinquished property must be 200% more than the property (or properties) selected.

The combined fair market value of the property (or properties) selected can't be more than 200% of the relinquished property.

Who can request a review of an administrative law judge's decision outside of the 20-day review period? An investigative supervisor Any individual The ALJ's supervisor The commission

The commission The commission can initiate a review outside the normal appeal period.

Who is the beneficiary of a 1031 exchange, as identified in the Exchange Addendum to Contract to Buy and Sell Real Estate (Residential - Income)? The buyer The cooperating party The exchanging party The seller

The exchanging party

Nina and the seller are completing the Colorado Brokerage Duties Disclosure to Seller. Which of the following statements about the disclosure form is true? Signed or unsigned, the form must be kept on file with the broker for at least two years. The form is a contract between the brokerage firm and the seller. The form is a supplement to the listing agreement. The form replaces the listing agreement.

The form is a supplement to the listing agreement.

Which of the following statements about the Colorado Brokerage Duties Disclosure to Seller form is true? By law, both the broker and the seller are required to sign and date the form. The form is a supplement to the listing agreement. The form, signed or not, must be kept on file with the broker until the transaction closes. When signed, the document creates a binding contract between the broker and the seller.

The form is a supplement to the listing agreement.

Which of the following statements about the Colorado Brokerage Duties Disclosure to Seller form is true? By law, both the broker and the seller are required to sign and date the form. The form is a supplement to the listing agreement. The form, signed or not, must be kept on file with the broker until the transaction closes. When signed, the document creates a binding contract between the broker and the seller.

The form is a supplement to the listing agreement. Colorado Brokerage Duties Disclosure to Seller form isn't a contract; it's a supplement to a REO or non-CREC-approved listing agreement. Signed or unsigned, it must be kept on file with the broker for at least four years.

What's true of the holdover period when using the Exclusive Brokerage Listing Addendum? The holdover period is automatic. The holdover period is capped. The holdover period must be negotiated. The holdover period no longer applies.

The holdover period must be negotiated.

Stan is a home inspector who's evaluating a home for potential buyers. He pointed out that neither of the two bathrooms had vent fans installed. Why is this a potential problem that will be noted on the inspection report? Bathroom fans can mitigate lead paint particles. Bathroom fans vent radon to the exterior of the home. The lack of air circulation in a moist room can lead to mold growth. Unseemly smells located that close to the kitchen are a problem.

The lack of air circulation in a moist room can lead to mold growth.

Which of the following statements about a buyer's working relationship with a licensee in Colorado is true? The buyer is the licensee's customer. The licensee may act as either a buyer's agent or a transaction-broker. There must be a written and signed agency agreement in place. To establish the relationship, the buyer must sign the Definitions of Working Relationships form.

The licensee may act as either a buyer's agent or a transaction-broker.

A licensee is having a conflict with her broker for arguing against working with a long-time client who has been practicing subtle forms of housing discrimination. Which of the following statements is true about this situation? The brokerage isn't liable for any discriminatory actions in housing practiced by its client. The licensee could be subject to penalties from the licensing board. The licensee is overreacting, since fair housing law covers only blatant forms of discrimination. The licensee may face consequences for her actions, but she's doing the right thing.

The licensee may face consequences for her actions, but she's doing the right thing.

A listing agent is planning to split the sale's commission with the agent who brings the buyer to the table. What's required for the listing agent to do this? A listing agent can't split the commission with a buyer's agent. The listing agent must get written approval from the seller. The property must sell for more than the list price. The property must sell for more than the owner still owes.

The listing agent must get written approval from the seller.

Who pays property marketing expenses according to Colorado's Exclusive Right-to-Sell Listing Contract? Expenses are split jointly between seller and broker The buyer The listing broker The seller

The listing broker

What does the Exclusive Brokerage Addendum provide regarding listing broker commission?

The listing broker will receive compensation in all situations except seller sales

Which of these situations would be exempt from most provisions of the federal Fair Housing Act? A homeowner engages a real estate professional to rent out his basement apartment. An investor owns and rents out five duplexes. A non-profit owns 20 properties that it only rents to Caucasian families. The local Elks club owns a property that's rented only to Elks club members.

The local Elks club owns a property that's rented only to Elks club members. Housing operated by religious organizations and private clubs that limit occupancy to members are exempt from the provisions of the Fair Housing Act.

Which of these situations would you advise your seller client to disclose? Any criminal activity occurring on the property within the last year. The mineral rights associated with the property don't belong to the seller. The number and species of pets the seller has kept on the property within the last six months. The property is located in an area that experiences freezing temperatures.

The mineral rights associated with the property don't belong to the seller.

Which of the following are documented in the Exclusive Right-to-Lease Listing Contract? The minimum acceptable security deposit Whether pets are allowed Who maintains the property's exterior Who pays for utilities

The minimum acceptable security deposit

When a buyer is assuming the seller's loan, which of these pieces of information is required to complete Section 4.6, Assumption, of the Colorado commercial sales contract? The amount of the buyer's monthly escrow payment The buyer's credit score The lender's name The new interest rate for the buyer

The new interest rate for the buyer The new interest rate that the lender will charge the buyer upon assumption of the loan is a field under Section 4.6 that must be completed.

Toby is the broker in an Exclusive Right-to-Buy Listing Contract, and Zoey is the buyer. Who has the right to cancel the agreement before the agreed-to contract end date? Neither party, because the contract doesn't allow for early termination The broker, but not the buyer The buyer, but not the broker The non-defaulting party

The non-defaulting party

Edward, an independent broker, would like to clear out some of his old transactional files, but he doesn't want to violate CREC record-keeping rules. Which of these documents may he safely throw out? A listing agreement that terminated three years ago. The notes he took during a listing presentation he made last year; he won the client and earned his biggest commission to date. The seller's property disclosures from a property his seller client pulled off the market last week. The settlement statement for a transaction that closed last year where he represented the buyer.

The notes he took during a listing presentation he made last year; he won the client and earned his biggest commission to date.

What's documented in the Exclusive Right-to-Lease Listing Contract as a landlord's disclosure obligation? The obligation to disclose any latent material defects The obligation to disclose any prior tenants with communicable diseases The obligation to disclose any psychological stigma associated with the property The obligation to disclose changing neighborhood crime statistics

The obligation to disclose any latent material defects

If any additional costs arise from a 1031 exchange in Colorado, which party is responsible for the costs? The buyer The investor's CPA The one benefiting from the exchange The seller

The one benefiting from the exchange

Which of the following states that, in certain cases, oral evidence can be used to support or complete an otherwise incomplete or ambiguous contract? The parol evidence rule The statute of frauds The statute of limitations The statute of oral evidence

The parol evidence rule The parol evidence rule states that, in certain cases, oral evidence can be used to support or complete an otherwise incomplete or ambiguous contract.

The air conditioning at a Colorado house goes out just before closing. The seller is unable to have the repairs completed before the closing date. Aside from terminating the contract or delaying closing, what's another option the parties can take to address this problem? The buyer may insist on payment from the home inspector. The parties can sue the buyer's broker for failing to inspect the air conditioning unit. The parties can sue the seller's broker for failure to inspect the air conditioning unit. The parties may agree to a credit given from the seller to the buyer at closing.

The parties may agree to a credit given from the seller to the buyer at closing.

Which party to a Colorado land sales contract that includes crops bears the risk for the crops' loss should they be damaged or destroyed during the contract period? The buyer, if within two weeks of closing The party entitled to the crops as described in Section 2.8, Growing Crops The party named under Section 19.6, Risk of Loss - Growing Crops The seller, at any time while the property is under contract

The party entitled to the crops as described in Section 2.8, Growing Crops Section 19.6 of the Colorado land sales contract states that the party who is entitled to the crops according to Section 2.8 bears the loss should they be damaged or destroyed before closing.

What does Section 8 of RESPA prohibit? Discrimination based on protected class status The payment of earnings from operating an affiliated settlement service business The payment of kickbacks and other fees that drive up costs to customers The receipt of promotional or educational materials from a settlement service provider unrelated to any referral of business

The payment of kickbacks and other fees that drive up costs to customers

Brokerage relationships are established by employment contracts. In Colorado, the employment contract is between ______________. The licensee and the principal The principal and the brokerage firm The principal and the employing broker The principal, the licensee, and the employing broker

The principal and the brokerage firm In Colorado, employment contracts that establish the agent-client relationship are between the principal and the brokerage firm, not an individual licensee or the employing broker.

Colorado closely adheres to the Uniform Power of Attorney Act. All agents must follow the provisions of the power of attorney by acting in whose best interests? The agent's The attorney's The broker's The principal's

The principal's

In a 1031 exchange, there are rules governed by Section 1031 of the Internal Revenue Code. The rules include _______. The basis of the original property is cancelled. The new property must be lower value than the relinquished property. The property in an exchange must be like-kind. The replacement property has to come with less debt load.

The property in an exchange must be like-kind.

In a 1031 exchange, there are rules governed by Section 1031 of the Internal Revenue Code. The rules include _______. The basis of the original property is cancelled. The new property must be lower value than the relinquished property. The property in an exchange must be like-kind. The replacement property has to come with less debt load.

The property in an exchange must be like-kind.

For which of the following property conditions would a buyer request the seller to deliver contracts relating to the property's operation, maintenance, and management under Section 10.6.1.1 of the Colorado commercial sales contract? The distribution business currently operated on the premises is being sold with the real estate. The property has current tenants with leases that will extend beyond the closing date. The property has recently completed renovations and repairs. The property uses a commercial service company to perform ongoing repairs and maintenance for the HVAC system.

The property uses a commercial service company to perform ongoing repairs and maintenance for the HVAC system.

When describing a property in a sales contract, which of the following is required for legal purposes? The property's current phone number The property's legal description The property's mailing address The property's ZIP code

The property's legal description

Which of the following statements about owner's extended coverage (OEC) is true? OEC is required for all residential purchases in Colorado. OEC is required on the purchase of all properties where the purchase price is $500,000 or above. OEC must be paid by the buyer. The property's title commitment may or may not include OEC.

The property's title commitment may or may not include OEC. The title commitment may or may not include owner's extended coverage (OEC), which is optional and negotiable. OEC may be paid by the buyer and/or seller, or by another party.

Which timing method of a 1031 property exchange requires an exchange accommodation titleholder (EAT)? The delayed exchange The replacement exchange The reverse exchange The simultaneous exchange

The reverse exchange The reverse 1031 exchange requires the services of an EAT.

What is an easement? A method for containing a hazardous substance The illegal building of a structure or object on another's property The right of the government to take private property for the good of the public The right to cross over or otherwise use another's land for a specified purpose

The right to cross over or otherwise use another's land for a specified purpose

The cases of Guaranty Title Co. vs. Denver Bar Association and Abstract Record & Title Co. vs. Denver Bar Association were decided ____________. Before the Conway-Bogue case One year before the Conway-Bogue decision One year following the Conway-Bogue decision The same day as the Conway-Bogue case

The same day as the Conway-Bogue case

What can happen when a seller misleads a buyer or withholds information on the Seller's Property Disclosure form? Fines of up to $500 may be assessed. The seller could be held liable for misrepresenting the property's condition, and so could the seller's agent if the agent knew of and failed to disclose the information. The seller could face prison time, not to exceed three years. The seller could lose the house to the state, after which the buyer would have the right of first refusal and prevailing market rates, less 10%.

The seller could be held liable for misrepresenting the property's condition, and so could the seller's agent if the agent knew of and failed to disclose the information.

In their Colorado sales contract, a buyer and seller agree that if possession is not given on the closing date, the seller will pay a daily fee of $90 until the seller delivers possession of the property. What other consequences could the seller face under the terms of this contract? The buyer could cancel the sales contract. The buyer could sue the seller for specific performance and receive a refund of his earnest money. The seller could be forced to refund the buyer's earnest money. The seller is subject to eviction.

The seller is subject to eviction. If the seller doesn't deliver possession of the property as dictated by the contract, the seller is subject to eviction and must pay the seller a specified daily rate until possession is delivered.

The Licensee Buy-Out Addendum must be attached to a purchase contract in certain situations when the buyer is a real estate licensee. Which of these statements is true about the contract when this addendum is attached? It gives the seller the right to a percentage of any profit the licensee earns from reselling the property. It must be used whenever the buyer is a Colorado real estate licensee. It requires the buyer/licensee to reduce any commission earned as a listing agent for the property by half. The seller may terminate the purchase contract at any time.

The seller may terminate the purchase contract at any time.

If there's no potable water source on a property, which of the following is true? The buyer must do a well feasibility test prior to closing. The seller can't lawfully sell the property. The seller must disclose that fact on an addendum. The seller must provide a credit to the buyer.

The seller must disclose that fact on an addendum.

What's the seller's obligation to provide due diligence documents requested by the buyer on a contract? The seller must provide all available documents before the Due Diligence Documents Delivery Deadline. The seller must provide all the documents before the Due Diligence Documents Delivery Deadline. The seller must provide all the documents prior to the scheduled closing date. The seller must provide all the documents within 30 days of the request.

The seller must provide all the documents before the Due Diligence Documents Delivery Deadline.

In a residential transaction, who's responsible for completing the CREC-approved Square Footage Disclosure form provided to the buyer and seller? The appraiser The buyer's broker The home inspector The seller's broker

The seller's broker

What happens if a Colorado property's air conditioning fails ten days before closing? The buyer must bring suit if the seller refuses to repair/replace The buyers are responsible for repair/replacement The parties must negotiate how the failure will be handled The sellers are responsible for repair/replacement

The sellers are responsible for repair/replacement

When state and federal laws differ, as they sometimes do with fair housing and/or human rights, which of these statements is true? State and local law override federal law. State lawmakers decide which law prevails. The conflicting law is invalidated, effectively removing the law's requirements. The state law may not remove rights granted to citizens under the federal law.

The state law may not remove rights granted to citizens under the federal law.

Tom and Jim are neighbors. Jim wants to buy Tom's rental property. In the contract they sign, Jim is identified only as "the neighbor." Which statute or contract element does this violate? Fair housing Legal purpose Offer and acceptance The statute of frauds

The statute of frauds The statute of frauds requires not only that a contract to convey real property be in writing, but also that the contract identify the parties to the contract.

Why is a survey recommended instead of an ILC for many land transactions? The ILC is only used for properties smaller than one acre. The ILC is only used if encroachments are suspected. The survey is less expensive, and unimproved land doesn't require the review of improvements the ILC provides. The survey provides better protection of the buyer's rights when property boundaries are in question.

The survey provides better protection of the buyer's rights when property boundaries are in question.

What's a reason a buyer would want to see tenant estoppel statements for a commercial property under contract? It gives the buyer the right to cancel all existing leases. It prevents tenants from canceling their leases on the basis of the change in property ownership. It's the buyer's only confirmation that there are existing tenants for an income-producing property. The tenant may bring forward a claim against the seller that the seller didn't disclose in other documentation.

The tenant may bring forward a claim against the seller that the seller didn't disclose in other documentation. Buyers want to know everything they can about existing tenants—even the things that the seller may not tell them about.

What does the parol evidence rule say about contracts? All contracts, commitments, and agreements for the sale of real property must be in writing. A sales contract must contain the essential elements of a contract for it to be enforceable. In order for a real estate agreement to be enforceable, it must be in writing and signed by both parties. The terms agreed to in a written contract are the only terms relating to that contract.

The terms agreed to in a written contract are the only terms relating to that contract. The parol evidence rules states that only in limited cases may extraneous evidence be presented to dispute the terms of a signed, written contract.

A broker is completing the Colorado Real Estate Commission-approved Counterproposal form for a seller client. Which of the following parts of the form should the broker complete? Both the terms the client wants to accept and those the client wants changed Neither the terms the client wants to accept nor those the client wants changed The terms in the original offer that the client wants changed The terms in the original offer that the client wants to accept

The terms in the original offer that the client wants changed

Which of the following statements best describes the 95% rule as it relates to tax-deferred exchanges? The combined fair market value of the property (or properties) selected as exchanges can't be more than 95% of the relinquished property. The fair market value of the relinquished property must be 95% more than the property (or properties) selected as exchanges. The total value of the property being sold must be at least 95% of the value of the profit to be made on the property (or properties) selected as exchanges. The total value of the property (or properties) selected as exchanges must be at least 95% of the value of the property being sold.

The total value of the property (or properties) selected as exchanges must be at least 95% of the value of the property being sold.

A seller wants to take the dwarf magnolia tree that's planted in the yard of the house she's selling. How should this appear in the Colorado sales contract? The tree should be listed under Exclusions. The tree should be listed under Inclusions - Attached. The tree should be listed under Inclusions - Not Attached. The tree should be listed under Other Inclusions.

The tree should be listed under Exclusions.

What must be disclosed about a property's potable water in Colorado? Average temperature fluctuation Its pH level The specific gravity allotted to it The water source and type of rights

The water source and type of rights

Which of these situations would require Thelma, a licensee, to attach the Licensee Buy-Out Addendum to the purchase contract? Thelma agrees to buy a seller's property to facilitate the seller's purchasing another property that will earn Thelma a commission. Thelma is acting as the buyer's agent, and the seller in the transaction is also a real estate licensee. Thelma is purchasing a property for her personal use, and is acting as her own agent in the transaction. Thelma is the listing agent for a property. The buyer she finds is also a real estate licensee who's purchasing the property for personal use.

Thelma agrees to buy a seller's property to facilitate the seller's purchasing another property that will earn Thelma a commission. When Thelma agrees to purchase a property in order to ensure that those sellers can successfully close on another property, and closing on that other property will earn her a commission, she'll need to use the Licensee Buy-Out Addendum.

Why does every CREC-approved contract for the buying and selling of residential real estate in Colorado include the special taxing district disclosure? Real estate professionals are fined if the disclosure is not included. Sellers can get higher asking prices for properties located in special taxing districts. Special districts are often built on waste sites and may present health hazards to the residents. There are financial ramifications and lien issues associated with special taxing districts.

There are financial ramifications and lien issues associated with special taxing districts.

Regarding the sales contract form used in Colorado, which of the following statements is true? Colorado has one sales contract form that's used for all real estate sales transactions. There is no one standard form in Colorado that's used for all sales contracts. There is no sales contract form that can be used statewide in Colorado. The sales contract in Colorado isn't legally binding.

There is no one standard form in Colorado that's used for all sales contracts.

Which statement is true about the retention of publicly available records? Only state public records, not county or local records, should be retained. There's no need to retain public records in a broker's files. They need only be retained for one year after a transaction closes. They should also be retained for four years along with a broker's records.

There's no need to retain public records in a broker's files. Publicly available records don't need to be retained with the brokerage files or produced upon request.

Why are galvanized pipes a problem in older homes? They are not a problem. They are out of date and can lead to a variety of electrical problems. They can rust and cause leaks and low water pressure. They indicate the heating and cooling system(s) are outdated.

They can rust and cause leaks and low water pressure.

Lisa and her husband Brad have fallen on hard times and are about to lose their home to foreclosure. They've received an offer to buy that's well below market price, but they accept it anyway because it's just enough to cover their remaining mortgage balance. The next day, Brad's aunt sends them a gift of cash that's enough to make their mortgage current, satisfying the lender. But now that they no longer need to sell, what can they do about the offer they accepted? Brad's aunt is now a legal co-owner of the property because she paid to make their loan current. The sales contract is voided. Nothing; they're legally obligated to sell, unless the buyer agrees to terminate the contract. Once the lender has received their payment making the mortgage current, foreclosure proceedings end, which voids the CBS (Colorado Foreclosure Protection Act) they signed. They can sign and date the Notice of Cancellation form attached to the CBS (Colorado Foreclosure Protection Act), and deliver it to the buyer, which will cancel the purchase agreement.

They can sign and date the Notice of Cancellation form attached to the CBS (Colorado Foreclosure Protection Act), and deliver it to the buyer, which will cancel the purchase agreement.

What are the main ways that license laws ensure consumer protection? They define standards, develop education standards, and create recurring revenue. They establish requirements, assess fees, and build education. They establish requirements, assess fees, and create recurring revenue. They establish requirements, define activities, and set standards.

They establish requirements, define activities, and set standards. License laws ensure consumer protection by establishing basic requirements for entry to the profession, defining activities that require a license, and setting conduct standards.

Your buyer clients, the Wassermanns, ask how water rights are conveyed in Colorado. What do you tell them? They may be conveyed separately from the land on which they're used. They may never be conveyed separately from the land on which they're used. They may not be conveyed They must be conveyed separately from the land on which they're used.

They may be conveyed separately from the land on which they're used.

The Raymonds are obtaining a home loan and failed to lock their interest rate. What's the worst thing that could happen if their interest rate rises? They could incur hefty fines. They may be found guilty of mortgage fraud. They may no longer qualify for the loan. They would have to pay more for their loan.

They may no longer qualify for the loan.

Which of the following is true about net listings? The listing agent is guaranteed at least some commission. They don't include compensation for the buyer's agent. They often involve a conflict of interest. They're legal in all 50 states.

They often involve a conflict of interest.

Broker Amy is the seller's agent in a transaction, and broker Lou is working with the buyer as a transaction-broker. Both brokers work at multiple-person firms, though not at the same firm. What's true about the brokers in this transaction? Amy is a designated agent, and Lou is a single agent. Their clients are represented by all brokers at their respective firms. They're designated brokers. They're dual brokers.

They're designated brokers.

Which of the following statements about signed Colorado Real Estate Commission-approved brokerage disclosure forms is true? Once signed, they must be kept on file for at least five years. They must be kept on file with a broker for at least three years. They're considered contracts. They're disclosures only, even when signed.

They're disclosures only, even when signed.

You're an associate broker looking for some good marketing strategies. You know consumers are looking for an agent they feel they can trust, so you add some professional designations to your name in your ads, to show you're experienced and knowledgeable. What's true about your decision? This is acceptable as long as your employing broker has also earned the same designations (or higher), since you represent your employing broker. This is acceptable as long as you've legitimately earned the designations you include, and they're verifiable by the public. This isn't allowed in your advertisements, since most consumers don't understand what the designations mean. This is only allowed if you include information about the organization granting the designation in your ad.

This is acceptable as long as you've legitimately earned the designations you include, and they're verifiable by the public. Professional designations may be included in a broker's ads as long as the broker (or brokerage firm) is in good standing, and the designation can be easily verified by a consumer.

Reginald is an employed broker who works at ABC Realty. He agrees to represent his cousin Jill, who's looking to buy her first home. Reginald knows Jill's scrimped and saved for a long time to afford her home, so he gives her part of the commission he's earned after the transaction closes, as a house-warming gift. What's true about this situation? Reginald can't legally give Jill part of his commission because she's unlicensed. Reginald has put Jill in a difficult position as the seller now has a legal right to demand that money back, since it didn't go to a licensee. Reginald is allowed to give Jill part of his commission as long as the money flows directly from his broker to Jill, and not through Reginald. This is allowed as long as Reginald has disclosed the gift, which would be considered a rebate, to the other parties in the transaction.

This is allowed as long as Reginald has disclosed the gift, which would be considered a rebate, to the other parties in the transaction. CP-12 allows rebates to an unlicensed purchaser. A broker can always negotiate commission and rebate commission as long as it shows up on the Closing Statement.

When a licensee who's also a licensed mortgage broker for the same transaction receives the loan application, how many days does the licensee have to present the buyer/borrower with the Dual Status Disclosure form? Five Four Three Two

Three

Zachary is acting as a real estate broker and a mortgage loan originator in the same transaction. How many days after he receives the loan application does Zachary have to present the buyer/borrower with the Dual Status Disclosure? Five Four Three Two

Three

Other than during the transition period, how long is the Colorado real estate broker's license term? Five years One year Three years Two years

Three years

An expired license can be reinstated as long as the license is expired for no longer than ________. Five years One year Six months Three years

Three years An expired license can only be reinstated if no more than three years has elapsed.

How is an agency relationship established between a broker and a buyer or tenant?

Through a buyer or tenant representation agreement

How is the amount of compensation paid by the buyer/tenant to the brokerage firm established in Colorado? Based on the purchase or lease price of the property By law By the listing brokerage Through agreement of the parties

Through agreement of the parties

Co-ownership of a unit (interval ownership)

Timeshare

What two cases in Colorado's real estate history are considered companion cases to the Conway-Bogue vs. Denver Bar Association case? Abstract Record & Title Co. vs. Colorado Supreme Court and Title Guaranty Co. vs. Colorado Supreme Court Colorado Real Estate Commission vs. Denver Bar Association and Title Guaranty Co. vs. Denver Bar Association Denver Bar Association vs. Colorado Supreme Court and Abstract Guaranty Co. vs. Colorado Supreme Court Title Guaranty Co. vs. Denver Bar Association and Abstract Record & Title Co. vs. Denver Bar Association

Title Guaranty Co. vs. Denver Bar Association and Abstract Record & Title Co. vs. Denver Bar Association

Why is the buyer/borrower asked to sign the Dual Status Disclosure form? To acknowledge receipt of the disclosure To give notice to the seller that the loan application has been submitted To provide consent for the real estate broker to continue to take part in the transaction To provide notice to the broker if the offer is contingent upon a loan

To acknowledge receipt of the disclosure

What's the correct way to use an amendment to a contract? To change the original contract's terms To create a binding agreement between two parties To learn more about the HOA requirements placed upon the property owner To make an addition to an existing contract

To change the original contract's terms

Purpose of a Commission Policy Statement?

To clarify real estate laws and rules

When would you use the Brokerage Duties Addendum to Property Management Agreement form in Colorado? To disclose the agency relationship established in a non-CREC property management contract To establish a property management contract To modify the Exclusive Right-to-Lease Listing Contract To modify the Exclusive Right-to-Sell Listing Contract

To disclose the agency relationship established in a non-CREC property management contract The Brokerage Duties Addendum to Property Management form is used to make the required relationship disclosures to landlords while allowing brokers or their brokerage firms to use their own version of a property management agreement contract.

What's an estoppel statement used for? To disclose the energy efficient appliances being sold with the property To disclose the known or unknown presence of lead in a property built before 1978 To disclose the structural and physical condition of the property being sold To disclose the terms and conditions of any lease agreements being transferred with the property

To disclose the terms and conditions of any lease agreements being transferred with the property

What's the purpose of an estoppel statement? To disclose the energy-efficient appliances being sold with the property To disclose the known or unknown presence of lead in a property built before 1978 To disclose the structural and physical condition of the property To disclose the terms and conditions of any lease agreements being transferred with the property

To disclose the terms and conditions of any lease agreements being transferred with the property

When will you use the Estoppel Statement form? To disclose the origin of the water supply to a buyer in a residential transaction. To disclose the terms of an existing lease to the property's buyer. When applying for your broker's license to disclose any past history of financial wrongdoing. When entering into a brokerage agreement with a consumer to disclose the actions you'll take as an agent or transaction broker.

To disclose the terms of an existing lease to the property's buyer.

What's the purpose of a sales contract? To document the agreement between a buyer and seller in a real estate sales transaction To notify the public that an offer has been made on a specific property To serve as an agreement between the seller and the licensee that the seller intends to sell the house To verify that the seller has the legal right to sell the property

To document the agreement between a buyer and seller in a real estate sales transaction

Why would a buyer need to know the type and age of a home's heating and cooling systems? The buyer should not ask about type of system, only age To get an idea of the potential problems or costs that may arise in older installations To identify whether the buyer is required to replace the systems To identify whether the seller is required to replace the systems

To get an idea of the potential problems or costs that may arise in older installations

Which of these describes the supervisory role of an employing broker in Colorado, as required by license law? To give all associated brokers at the firm sufficient supervision to ensure a high level of consumer protection To give brokers with less than two years of experience a high level of supervision, and those with more than two years of experience a reasonable level of supervision To give new brokers (those who have participated in fewer than three transactions) a reasonable level of supervision, and brokers who have completed three or more transactions a practical level of supervision To supervise all brokerage activities in a way that supports a reasonable level of profitability for any associated licensee

To give brokers with less than two years of experience a high level of supervision, and those with more than two years of experience a reasonable level of supervision

Why is a Notice of Cancellation submitted along with an offer to purchase a Colorado property that is in foreclosure? To give notice of the seller's right to cancel the purchase contract. To give notice that the homeowner may stop the foreclosure. To give notice that the loan will be paid in full when the transaction closes. To protect the broker and brokerage from liability if the buyer changes his mind.

To give notice of the seller's right to cancel the purchase contract.

What's the purpose of an amendment to a listing contract? To modify a contract's information, terms, commission, or exclusions after it's been executed To modify and define the terms of the contract before it's signed To modify the broker's duties to the seller To notify the buyer or seller of changes to the contract

To modify a contract's information, terms, commission, or exclusions after it's been executed

You and your buyer client, Ted, are reviewing the sales agreement. Ted asks you the purpose of the financing contingency. How do you respond? To make sure the seller's interests are protected To obligate the seller to lower the price if interest rates rise To protect the buyer in case the buyer can't obtain financing To provide for seller financing in case the buyer's financing falls through

To protect the buyer in case the buyer can't obtain financing

Why does the Due Diligence section of Colorado's non-residential sales contracts use standard language that's not found in the residential version? To implement legally required safeguards for tenants of the commercial building To prevent illegal use of a property after the transaction closes To protect the buyer from purchasing a property with structural defects To protect the buyer's right to evaluate the property's income potential

To protect the buyer's right to evaluate the property's income potential The due diligence for a commercial property is primarily concerned with evaluating its income-producing potential, rather than meeting legal requirements for the safety of the residents.

Why do residential and commercial real estate purchases require a different contract? Because commercial properties are more expensive Because most commercial real estate involves a ground lease To ensure that only qualified real estate agents are representing the parties To provide the proper legal protections to the parties involved

To provide the proper legal protections to the parties involved

Why is it important for sellers to inform buyers when a chimney or fireplace was last inspected? So the buyer knows if they need to have the chimney cleaned soon after they purchase the property So the buyer knows when it may need to be replaced To reveal information about maintenance and function To show the seller is on top of maintenance issues for the entire house

To reveal information about maintenance and function

While an office building is under contract, the seller wants to add a new tenant. What is the buyer's responsibility in this situation, according to the Colorado Contract to Buy and Sell Real Estate (Commercial)? To allow this or any other modification to existing lease agreements, as long as the seller informs the buyer in writing of the change(s) To modify the offer to buy with an adjustment that accounts for the modified tenant base for the property To negotiate with the new tenant so that the terms of the lease will be agreeable to the buyer as the new property owner To review the seller's request and agree to it in a timely manner, if it's reasonable

To review the seller's request and agree to it in a timely manner, if it's reasonable The Colorado commercial sales contract requires that the seller request permission from the buyer for any modifications or additions to existing leases, but it also obliges the buyer to agree to any reasonable request in a timely manner.

What's the purpose of a home inspection from the buyer's standpoint? To catch seller's lies To provide data for future litigation To provide data to obtain a sales price reduction To uncover latent defects

To uncover latent defects

A broker who has a signed employment agreement with a seller may act as the seller's single agent or as a ______. Buyer's agent Cooperating agent Dual agent Transaction broker

Transaction broker

A _______________ assists a party in the transaction but doesn't represent that party. Broker-assistant Designated agent Single agent Transaction-broker

Transaction-broker

A broker who doesn't represent the principal to a transaction

Transaction-broker

A licensee acting as a facilitator but not in a agency capacity in a transaction

Transaction-broker

A licensee doesn't represent any party to the transaction, but may assist a party in certain aspects of the transaction

Transaction-broker

A licensee who doesn't represent a party to the transaction, but assists a party with certain aspects of the transaction is called a ______. Dual agent Limited agent Sub-agent Transaction-broker

Transaction-broker

Although there is no signed agency agreement in place, Cindy, a broker with Colorado Mountain Corridor Realty, is working with sellers, Margo and Tim, to sell their property. Cindy can assist Margo and Tim but she can't advocate or negotiate on their behalf during a real estate transaction. Cindy is a ___________. Buyer's agent Customer Seller's agent Transaction-broker

Transaction-broker

In the "in-company transactions" section of the listing contract, sellers can decide between having the broker treat the buyer as a customer or having the broker act as a ___________. Buyer's agent Designated agent Dual agent Transaction-broker

Transaction-broker

Josephine presented the Change of Status form to the seller and buyer. Both the seller and buyer signed the disclosure. Now that the disclosure has been given, what's Josephine's working relationship with the buyer? Buyer's agent Independent contractor Seller's agent Transaction-broker

Transaction-broker

Gloria asked her neighbor, Tom, a real estate broker, to help her sell her cabin. But she wasn't interested in full representation. She simply needed him to list the cabin online and then help her with paperwork. What type of relationship would Tom establish with Gloria? Designated agency Single agency Sub-agency Transaction-brokerage

Transaction-brokerage

What may a lender charge a buyer who's assuming the seller's loan in a commercial property purchase in Colorado? Contract fee Interest gap fee Origination fee Transfer fee

Transfer fee

A tax that applies with real property transfers

Transfer tax

Prior to the tenant's possession, the broker and the tenants have a dispute over one of the terms in the Exclusive Tenant Listing Contract. Per the agreement, what are the broker and the tenants required to do? Draw up a new agreement. Meet with the brokerage firm to assign a new broker. Terminate the contract. Try to resolve the issue through mediation.

Try to resolve the issue through mediation.

Number of years a new broker in Colorado must be supervised by an employing broker before going independent

Two

What disclosures must be made by the seller concerning the plumbing system on the Seller's Property Disclosure form? Last date of water quality test and system inspection Number of toilets on the property Presence of hair traps in all bathroom drains Type of piping, sewage pumps, water filters, or plumbing issues

Type of piping, sewage pumps, water filters, or plumbing issues

Tyra and her soon-to-be buyer client are completing the Exclusive Right-to-Buy Listing Contract. How will Tyra's compensation be determined? The amount of compensation Tyra will receive is set by Colorado law. Tyra and her client will agree on an amount to be paid. Tyra and her client will use the fee set by Tyra's brokerage firm. Tyra will base her commission on the price range of the properties her client is interested in.

Tyra and her client will agree on an amount to be paid.

Established that electronic documents and signatures have the same legal equivalence as physical records and writing

Uniform Electronic Transactions Act (UETA)

17 duties that apply to both single agents and transaction-brokers; established by statute in Colorado

Uniform duties

Statutory duties required of Colorado agents and transaction brokers are called _______. Agent duties Commission duties Fiduciary duties Uniform duties

Uniform duties

A _________ is someone with broad authority to act in all matters. An example would be someone who acts in the role of a conservator. Dual agent General agent Special agent Universal agent

Universal agent

A person with unlimited power to act for another, such as a conservator, or one who holds a broad scope power of attorney

Universal agent

Nora is a licensee who wants to establish a single agency relationship with a seller. She knows this can only be done via express, written agreement, so she ______. Directs the seller to hire an attorney to draft a listing agreement Uses a standard listing agreement form from a legal documents website Uses brokerage letterhead to draft an agreement according to license law and the seller's wishes Uses the CREC-approved listing agreement

Uses the CREC-approved listing agreement

If disciplinary actions are levied against a licensee, what's one alternative to an administrative hearing? Giving public apologies Paying legal fees and fines Performing community service Using the expedited settlement program

Using the expedited settlement program

Buyer lien against a seller in default when the transaction involves a purchase money mortgage

Vendee lien

The buyers in a sales transaction that was terminated when the seller defaulted have a ___________ lien against the seller's property to ensure that their earnest money is reimbursed. Judgment Mechanic's Vendee's Vendor's

Vendee's When a seller defaults in performing a contract, the buyer has a vendee's lien against the property for sale to receive an earnest money reimbursement.

What type of lien does a contract for deed security instrument provide to the buyer? Judgment lien Mortgage lien Vendee's lien Vendor's lien

Vendee's lien

Seller lien against a buyer in default when the transaction involves a purchase money mortgage

Vendor lien

If buyers using a purchase money mortgage fail to pay for a property in full, a ______________ lien allows the seller to repossess the property. Judgment Mechanic's Vendee's Vendor's

Vendor's

What type of lien does a contract for deed security instrument provide to the seller? Judgment lien Mortgage lien Vendee's lien Vendor's lien

Vendor's lien The contract for deed agreement creates a vendor's lien for the seller (vendor), which allows the seller to repossess a sold property until the buyer pays the full, agreed-upon purchase price.

Victoria, a broker, comes into contact with a potential buyer and is required by law to present the buyer with the Colorado Brokerage Disclosure to Buyer form. What's Victoria's working relationship with the seller? The seller and Victoria have a signed buyer agency agreement. The seller is Victoria's customer. The seller is Victoria's potential client. Victoria is acting as the seller's agent or transaction-broker.

Victoria is acting as the seller's agent or transaction-broker.

A real estate licensee who is not a licensed mortgage loan originator but who assists a buyer client with negotiating for a loan provided by the seller is ___________. Acting within the limits of real estate law Providing a service that will generally earn an increased commission Required to disclose that he or she is not licensed as a mortgage broker Violating the law and may be subject to severe penalties

Violating the law and may be subject to severe penalties

While showing your buyers through a home, you flipped on the light in the powder room and were concerned because the light switch felt warm. Why is this a concern? Warm light switches might mean the house doesn't cool well. Warm light switches might mean the house doesn't heat well. Warm light switches might mean there is an electrical problem. Warm light switches might mean there is a structural problem.

Warm light switches might mean there is an electrical problem.

Joan has found an interested buyer for her client's forested, 15-acre, unimproved property nestled deep in the mountains. Which of the following factors should Joan be well-versed in to properly represent the property for her client? Home upgrades, landscaping, and curb appeal Office building tenant leases Residential property management Water and mineral rights, hunting leases, and timber production

Water and mineral rights, hunting leases, and timber production

This district entity hears matters related to water rights.

Water court

What is the most common way that asbestos enters the body? Asbestos coating in water pipes can contaminate drinking water, which is then ingested. Asbestos in paint can be released into the air as the paint peels, which is then inhaled or ingested. When asbestos fibers decay or are disturbed, the friable particles can be inhaled. When rocks and soil decay, asbestos gas is released, which is then inhaled.

When asbestos fibers decay or are disturbed, the friable particles can be inhaled.

When is a licensee required to use the Change of Status form in Colorado? When licensees change affiliation from one brokerage firm to another When licensees find themselves working with both parties in the same transaction When licensees' listings change from "for sale" to "under contract" When one of the parties' marital status changes, and the agency agreements have to be modified

When licensees find themselves working with both parties in the same transaction

Which of the following is a true statement regarding amendments and addenda? They don't carry the same legal weight as the sales contract itself. They must be completed by an attorney. They remain separate from the contract, but equally binding. When signed by the parties, they become part of the sales contract.

When signed by the parties, they become part of the sales contract.

The Licensee Buy-Out Addendum gives a seller additional rights in a transaction because ________. The licensee has a fiduciary duty to make the transaction as profitable as possible The licensee is usually offering a below-market price on the property The seller is essentially paying the buyer a commission to purchase the property When the buyer is also the listing agent, there's a conflict of interest

When the buyer is also the listing agent, there's a conflict of interest

When is the Notice of Cancellation attached to a foreclosure sales contract? When the broker submits the contract to the lender. When the buyer is given the contract. When the contract is notarized. When the contract offer is submitted to the seller.

When the contract offer is submitted to the seller.

When is the Colorado land sales contract the most appropriate contract to use? When the buildings on the property have been condemned When the land is vacant or is used for agricultural purposes When the property is larger than five acres When there's a commercial business on a property larger than 100 acres

When the land is vacant or is used for agricultural purposes

In Colorado, when are property owners required to disclose that they live in a special taxing district? If the property values at $100,000 or more When the assessments owed are more than $25 per $1,000 of property value When they are selling or transferring ownership of their property When they live in a district of 25,000 residents or more

When they are selling or transferring ownership of their property

When is an administrative fee acceptable, according to RESPA? When it is a required service offered by an affiliated business. When it is split with the settlement service provider. When it is undisclosed. When you are the only one receiving the fee and have actually performed some service in addition to the one provided by the SSP.

When you are the only one receiving the fee and have actually performed some service in addition to the one provided by the SSP.

The property management agreement between owner Susan and property manager Phil creates a relationship where Phil is the agent for Susan. Which of the following is NOT addressed in the agreement? Fees to be charge tenants by the property manager Fees to be paid by the owner The extent of the manager's authority to act for the owner Whether or not the owner will accept lease applications requesting accommodation of an emotional support animal

Whether or not the owner will accept lease applications requesting accommodation of an emotional support animal

How is an open listing agreement documented in Colorado?

With the Open Listing Addendum as an addendum to the exclusive right-to-lease contract or exclusive right-to-sell contract

Your buyer clients have applied for a mortgage loan. When can they expect to see the Loan Estimate from the lender? Five business days prior to closing Immediately after the seller accepts their offer Once the loan application has been approved Within three business days after submitting a loan application

Within three business days after submitting a loan application

Gertrude was a seller's agent for Damian in the sale of his house. She also represented Damian as a buyer's agent in the purchase of a new home. Is this permitted? No, Gertrude can only represent Damian in one transaction. No, this is a dual agency situation. Yes, a licensee can represent one party in one transaction and represent the same party in a different transaction. Yes, if the transactions do not overlap.

Yes, a licensee can represent one party in one transaction and represent the same party in a different transaction.

Edward is an independent broker who's made a New Year's resolution to put all his old transactional records in a digital format. He'll then destroy all the hard copies by sending them to a document shredding service. Is Edward in compliance with CREC rules for recordkeeping? No, only specific documents can be stored as electronic records, such as those that are publicly available. No, single-person firms must always keep all records as hard copies. Yes, as long as he reviews each file and redacts any client signatures or confidential information they contain. Yes, as long as the digital files are secure and can be printed and produced if needed.

Yes, as long as the digital files are secure and can be printed and produced if needed.

Broker Dill accidentally let his license expire. Now he needs to figure out what he's supposed to do to reinstate his license. Will the commission rules help him do this? No, commission rules are regulations that describe the real estate commission duties, and don't apply to licensing requirements. No, commission rules govern the actions of consumers and businesses, not individual licensees. Yes, commission rules are written to help licensees interpret and comply with license law. Yes, the commission rules will give Dill a list of approved education providers and include links to the application he should complete.

Yes, commission rules are written to help licensees interpret and comply with license law.

Brandi is an associate broker at Better Brokerage. She's currently representing a seller whose property is under contract and will be closing in two weeks. Brandi keeps her own copies of all the contract documents in her home office. Is Brandi in compliance with CREC rules? No, because these are considered escrow documents that only an employing broker may control. No, copies of documents related to current transactions may never be kept outside the main office. Yes, if Brandi is an experienced broker who's been licensed for more than two years. Yes, if the office policy manual at her brokerage specifically allows this.

Yes, if the office policy manual at her brokerage specifically allows this.

Independent broker Rebekah is designing a print ad marketing her services as a broker. She makes sure it's eye-catching and has her name and contact information on it. Does she need to include anything else to make it a legal advertisement according to Colorado license law? No, she's good to go! Yes, she has to include a statement directing consumers to DORA if they have a complaint about her. Yes, she must include her broker license number on all ads. Yes, she must make sure she's included the name of her brokerage firm.

Yes, she must make sure she's included the name of her brokerage firm.

Boden, who is a 72-year-old retired veteran living in Aspen, feels he has been denied brokerage services because of his age. Can he file a complaint based on age discrimination? No, age isn't recognized as a protected class anywhere in the state of Colorado. No, Colorado follows federal law when it comes to age discrimination, and age isn't a federally protected class. Yes, Colorado includes age as a protected class throughout the state. Yes, the law says it's illegal to discriminate based on age in Aspen.

Yes, the law says it's illegal to discriminate based on age in Aspen.

Jared is looking to purchase property. One of the properties he's interested in was formerly zoned for commercial use. It has a steep drop off at the back of the property, as well as some soft spots and mounds. Does this matter? No, Jared can address the cliff by bringing in additional soil. No, Jared is going to bulldoze the entire property to flatten it out anyway. Yes, these are clues that the property may have been used as a waste disposal site. Yes, these are indications of an underground storage tank.

Yes, these are clues that the property may have been used as a waste disposal site.

Paul and Blake are touring an open house when they notice that the glass on the sliding patio door is very foggy. Is this a concern, and if so, why? No, this is not a concern, as it only indicates poor cleaning habits. No, this is not a concern as it's common in cold climates. Yes, this could be a sign of fire damage. Yes, this is a sign of a leaky seal which reduces efficiency.

Yes, this is a sign of a leaky seal which reduces efficiency.

Colorado real estate broker Pauline is completing the Counterproposal form on behalf of her seller client, Leon. Leon only wishes to counter on the closing and possession dates. Because the "Purchase Price and Terms" table won't be updated in the Counterproposal form, Pauline decides to omit it. Is this allowed? No. Colorado brokers are prohibited from altering Colorado real estate forms. No. While some Colorado forms may be altered by brokers, the Counterproposal form may not be altered by brokers. Yes. Because the "Purchase Price and Terms" table doesn't apply to this transaction, it may be omitted. Yes. Colorado brokers have the right to alter CREC-approved forms in any way they'd like.

Yes. Because the "Purchase Price and Terms" table doesn't apply to this transaction, it may be omitted.

When filling out the Listing Contract Amend-Extend form, how do you indicate which contract you're amending? You attach a copy of the old contract to the Listing Contract Amend-Extend form and sign both with new dates. You check one of the four available listing contract boxes at the top section of the form. You don't have to indicate which contract since the form addresses only listing contracts. You include the original listing contract title and signing date in the additional amendments section.

You check one of the four available listing contract boxes at the top section of the form.

How would you avoid violating RESPA when referring clients to your affiliated settlement service business? You can only receive payment for the referral of the client to the affiliated business and not any related to the return earned from owning the business. You must disclose the relationship and cannot require the client to use the affiliated business. You must not disclose the relationship, as it could bias the client. You must require the client to use either both services or none.

You must disclose the relationship and cannot require the client to use the affiliated business.

Which one of the following best describes the fiduciary duty of confidentiality? You must keep all material facts confidential. You must keep all parties' information confidential. You must not discuss confidential matters with your client. You must not share your client's confidential information.

You must not share your client's confidential information.

You and your seller and buyer clients are completing the Colorado Change of Status form. Once the form has been completed, what responsibilities will you have to the seller and buyer? You'll advocate for the party who contracted with you first. You'll assist both parties with the transaction. You'll negotiate on behalf of the buyer. You'll negotiate on behalf of the seller.

You'll assist both parties with the transaction.

Your buyer client has reviewed the Counterproposal form you received from the seller's agent and is ready to agree to the modified terms. What action will you take? Since your client already signed the original CBS, you'll have her initial the seller's Counterproposal to indicate acceptance of the amendments. You'll complete a new CBS that reflects all the terms of the original CBS and the seller's Counterproposal, have your client review and sign, then send it to the seller's agent. You'll ensure your client understands how the Counterproposal modifies the terms of the original CBS and creates a complete contract before having your client sign the Counterproposal form. You'll notify the seller's agent that the modified terms are agreeable to your client so a new CBS can be created for signature by all parties.

You'll ensure your client understands how the Counterproposal modifies the terms of the original CBS and creates a complete contract before having your client sign the Counterproposal form.

How many grace days does the IRS give for the deadlines of a tax-deferred exchange?

Zero

In Colorado multi-broker firms, in accordance with the Designated Brokerage Relationships in Real Estate Act, brokers are identified as either _____. employing or employed independent or cooperative special or general temporary or permanent

employing or employed In Colorado, in multi-broker firms, the Designated Brokerage Relationships in Real Estate Act requires that a broker be either identified as either an employing broker, or an employed broker. The employed broker (often simply referred to as associate brokers) may be either actually employed by the firm, or have an independent contractor agreement with the firm, which makes a difference primarily for tax and benefits requirements. The contractual relationship doesn't change the employing broker'

In the state of Colorado, if a sales contract isn't _____________ by the seller, it's considered void. enforced initialed negotiated signed

signed