Course 2 Unit 3

A property is listed at $145,000. The commission rate for the sale will be 6%. The state deed tax will be $3.30 per $1,000 of the net sale price. Other closing costs for the transaction are estimated to be $500. It is assumed that a buyer will have an 80% loan to value based on the estimated sale price. If the property sells for its list price, what would be the buyer's loan amount? A) $116,000 B) $150,000 C) $145,000 D) $120,000

$116,000

A property is listed at $145,000. The seller has agreed to pay two discounts points to assist with the buyer's loan. The commission rate for the sale will be 6%. Other closing costs for the transaction are estimated to be $500. It is assumed that a buyer will have an 80% loan to value based on the estimated sale price. What is the amount in dollars that the seller would pay in discount points if the property sold for the list price and at the estimated loan to value? A) $2,400 B) $2,320 C) $3,000 D) $2,900

$2,320

A property is listed at $145,000. The state deed tax will be $3.30 per $1,000 of the net sale price. Other closing costs for the transaction are estimated to be $500. What would the seller's state tax deed charge be if the property sold for its list price? A) $396.00 B) $478.50 C) $495.00 D) $382.80

$478.50

When a salesperson just starts filling out the listing contract, what type of close is that? A) Alternative close B) Action close C) Minor-point close D) Steamroller close

Action close

How does a seller give the selling agent permission to post pictures or information about the property on the internet? A) Agree to it in the listing agreement form B) Agree to it in the internet neutrality options form C) Agree to it in the internet permission form D) Agree to it in the internet neutrality display options form

Agree to it in the listing agreement form

Which event will terminate a listing agreement? A) The agreement expires B) The property is sold and closes C) The death of the seller D) All of these

All of these

The protective list generated by a broker at the expiration of the listing agreement must be delivered to the seller within how many hours after the expiration of the listing agreement? A) 62 hours B) 72 hours C) 36 hours D) 24 hours

B) 72 hours

Commissions charged by brokers for professional services are set in which of the following ways? A) By negotiation between the broker and the client B) By local real estate board policy C) By local custom and use D) By state-approved regional commission contracts

By negotiation between the broker and the client

Which statement is TRUE regarding experienced homesellers? A) They often have higher-priced homes to sell than first-time sellers. B) They have higher expectations of service. C) They are more knowledgeable than first-time sellers. D) All of these.

D) All of these.

The VA closing fee only applies to which type of loan? A) Federal Housing Administration (FHA) loans B) Privately insured loans C) Department of Veterans Affairs (VA) loans D) Privately insured loans to veterans

Department of Veterans Affairs (VA) loans

Which of the following is LEAST likely to be included as a part of the listing agreement? A) Contracted expiration date B) List of fiduciary duties C) Listing price D) Estimated closing costs

Estimated closing costs

From a licensee's perspective, all sellers essentially have the same needs. They want to sell the home quickly, at the highest price possible, and with the least amount of hassle possible. True False

False- All have their own needs

Which statement is TRUE regarding a listing agreement? A) It is a contract between the seller and the salesperson. B) It is a contract between the broker and the seller. C) It is a contract between the seller and the general agent. D) It is a contract between the broker and the buyer.

It is a contract between the broker and the seller.

In which way does the seller NOT have to cooperate with the listing broker? A) Delivering owners association documents, if required B) Locating and delivering the seller certificate of insurance on the property C) Taking action necessary to convey marketable title by the date of closing D) Answering the broker's inquiries related to material facts

Locating and delivering the seller certificate of insurance on the property

According to federal fair housing laws, which of these is NOT a protected class? A) Religion B) National origin C) Family status D) Marital status

Marital status

MOST sellers, when deciding to have their home professionally marketed, will interview how many agents? A) Four or more B) Two C) One D) Three

One

Which clause in the listing agreement protects the broker's commission once a listing has expired should the seller sell the property to a person that the broker had substantive contact with before the expiration of the listing contract? A) Vindication clause B) Override clause C) Integrity protection clause D) Holdover clause

Override clause

What is the MOST common way people select a real estate salesperson? A) Referral by a friend or relative B) Internet search C) Homes magazine D) Facebook

Referral by a friend or relative

Which statement is TRUE regarding relocation companies? A) Relocation companies are not permitted to do business in most states. B) Relocation companies are not motivated to sell property. C) Relocation companies represent corporations that are transferring employees. D) Relocation companies typically work with highly trained and certified agents.

Relocation companies typically work with highly trained and certified agents.

Which statement is TRUE regarding relocation companies? A) Relocation companies typically work with highly trained and certified agents. B) Relocation companies are not motivated to sell property. C) Relocation companies represent corporations that are transferring employees. D) Relocation companies are not permitted to do business in most states.

Relocation companies typically work with highly trained and certified agents.

Which of the following is NOT required to be in a listing agreement? A) The date of the first open house B) Terms the seller will accept C) The amount of commission the broker will charge D) A specific start and end date

The date of the first open house

Which of the following is a reason to place a new listing on the office tour? A) The office tour exposes listings to salespeople in the salesperson's office who sell property in the area. B) There is no advantage to placing a new listing on the office tour. C) The office tour saves the salesperson money on advertising. D) The office tour lets the salesperson show off to the other salespeople in the office.

The office tour exposes listings to salespeople in the salesperson's office who sell property in the area.

The listing agreement on a residential property states that it will expire on June 15. Which event would NOT cause the termination of the listing agreement? A) The house is destroyed by fire on May 25. B) The agreement is not renewed before June 15. C) The owner dies on May 30. D) The owner shares concerns with the broker regarding marketing efforts on May 20.

The owner shares concerns with the broker regarding marketing efforts on May 20.

A seller has listed a property with a broker using an exclusive right-to-sell agreement. If the seller finds a buyer for the property during the listing period, which of the following is TRUE? A) The seller owes the broker partial commission. B) The seller owes the broker a full commission. C) The seller will owe no commission. D) The seller must reimburse the broker for reasonable costs incurred.

The seller owes the broker a full commission.

A seller has listed a property with a broker using an exclusive right-to-sell agreement. If the seller finds a buyer for the property during the listing period, which of the following is TRUE? A) The seller owes the broker partial commission. B) The seller will owe no commission. C) The seller must reimburse the broker for reasonable costs incurred. D) The seller owes the broker a full commission.

The seller owes the broker a full commission.

In which situation is the broker NOT entitled to a commission? A) The broker presents the seller with an offer that meets the seller's price and terms, but the seller refuses to accept the offer B) The seller refuses to close C) The closing of a sale D) The seller withdraws the property from the market due to destruction of improvements

The seller withdraws the property from the market due to destruction of improvements

What is the MOST important number to sellers? A) The agent's commission B) The agent's phone number C) The seller's net proceeds D) The listing price for their home

The seller's net proceeds

A virtual office website (VOW) is a site that allows brokers to share nearly all the information on their listings. Which statement about VOWs is FALSE? A) VOWs are web-based on the World Wide Web. B) A VOW is a site operated by a broker who participates in the MLS. C) Visitors to a VOW site are required to register to access data. D) Those accessing information from a VOW site pay an access fee.

Those accessing information from a VOW site pay an access fee.

A very experienced seller who also moves every three years is MOST likely A) a distressed seller. B) a transferee. C) a short sale. D) a first-time seller.

a transferee.

A listing that allows the seller to list concurrently with more than one broker and owe a commission only to the broker that sells the property is A) an open listing. B) a multiple listing. C) an exclusive right-to-sell listing. D) an exclusive agency listing.

an open listing.

When providing real estate services to an employee who is transferring, all of the following should be considered EXCEPT A) transferees have a sense of urgency to complete the transaction. B) transferees may have left the area in which they are selling their home before closing. C) family members of the transferees may stay in the area so that children can finish school. D) costs associated with transferees are minimal compared to other transactions.

costs associated with transferees are minimal compared to other transactions.

Joan, a salesperson with Sunshine Realty, has received a call from her aunt Karen inquiring about placing her home on the market. Karen is looking to move to a smaller home after living in her current home for 42 years. Karen's spouse passed away in the home in 2005 after a battle with cancer. The home has a roof that is leaking and has caused some water damage, which is not visible to most people. The BEST way for Karen to disclose the leaking roof would be to A) do nothing; there is no need to disclose the leaking roof because the buyer is entitled to a home inspection. B) do nothing; because the home was built before 1978, there is no need to disclose the leaking roof. C) disclose and explain the leaking roof in the seller's written disclosure. D) verbally tell Joan, who in turn can inform potential purchasers.

disclose and explain the leaking roof in the seller's written disclosure.

When presenting the seller's estimated selling expenses or seller's net sheet, it is important that salespeople explain A) the commission only. B) each expense. C) at least half of the expenses. D) the buyer's expenses.

each expense.

According to the Minnesota Association of REALTORS®, more than 50% of homesellers are 65 or older. True False

false

Before listing, the seller's lender will complete a seller's expense worksheet. True False

false

By the time a first-time seller speaks with a salesperson, he typically already has a clear understanding of the selling process. True False

false

It is the listing agent's responsibility to set the listing price of a property. True False

false

Lockboxes are used to allow buyers who are not working with agents to have access to the property. True False

false

Mandatory disclosures such as those for methamphetamine production, wells, septic, and lead-based paint are NOT required if the buyer and the seller agree to waive the seller's disclosure requirement. True False

false

Real estate commissions are generally determined by the local real estate association. True False

false

Sellers are required to list at the price indicated by the competitive market analysis. True False

false

The MNAR exclusive right-to-sell listing contract requires the sellers to promptly disclose any inquiries they receive regarding the property to the listing agent. True False

false

The dual agency disclosure and consent provision in the listing agreement need only be signed by the seller if a dual agency situation actually arises. True False

false

The exclusive right-to-sell listing contract also gives the broker the authority to lease or manage the property. True False

false

The exclusive right-to-sell listing contract is an employment agreement appointing the salesperson as the seller's exclusive agent. True False

false

The seller's primary consideration is MOST likely the listing price. True False

false

With a VA-guaranteed loan, the closing fee must be paid by the buyer. True False

false

The Minnesota state deed tax is 3.3% of the selling price. True False

false- its 0.0033

When working with first-time sellers, salespeople should make sure they explain the selling process because A) it will confuse them, causing them to close. B) the salesperson will look like he is in control. C) first-time sellers are unfamiliar with the steps involved in selling a home. D) it takes up interview time.

first-time sellers are unfamiliar with the steps involved in selling a home.

After the salesperson has completed the listing presentation and explained each expense to the seller, it is time to start asking closing questions. A closing question is used to A) confuse the seller. B) get the seller to sign the listing contract. C) conclude the interview. D) let the competition have a chance.

get the seller to sign the listing contract.

During the listing presentation, it is important for salespeople to demonstrate to the sellers their real estate knowledge, sales abilities, and A) knowledge of trivia. B) hobbies. C) marketing skills. D) sense of humor.

marketing skills.

Commissions charged by brokers for their services are set by A) state law. B) master compensation agreements among brokers. C) negotiation between the client and the broker. D) professional association standards.

negotiation between the client and the broker.

A broker listed a seller's property and, three days later, presented the seller with an offer that met the seller's requirements for sale, including a full-price offer. However, the seller rejected the buyer's offer. In this situation, the seller must A) sell the property, as it is a full-price offer. B) pay the listing broker a commission. C) pay the buyer liquidated damages. D) cover the broker's cost incurred to date for marketing the property.

pay the listing broker a commission.

The purpose of the competitive market analysis is to help the seller understand the local A) school system. B) business in the area. C) real estate market. D) weather.

real estate market.

The purpose of the competitive market analysis is to establish a price range by comparing the seller's home to homes that are for sale and have been A) recently rented. B) painted. C) recently sold. D) repaired.

recently sold.

During the listing presentation to the sellers, it is important to demonstrate real estate knowledge, marketing skills, and A) a sense of humor. B) sales abilities. C) proof of your identity. D) your hobbies.

sales abilities.

The well use status indicates the use status of each well. The choices are in use, not in use, and A) abandoned. B) sealed. C) retired. D) lost.

sealed.

The main reason to hold an open house is to A) meet the neighbors. B) let the community know the salesperson is active in the area. C) sell the seller's home. D) look for buyer prospects.

sell the seller's home.

When a seller owes more on a property than the current value, it is commonly called A) a cash sale. B) a bank sale. C) a forced sale. D) a short sale.

short sale

In a listing agreement, the seller authorizes the listing broker or other brokers working with the listing broker to do all of the following EXCEPT A) solicit tenants to lease the property before the sale of the real estate. B) cooperate with state law regarding tenants' rights during the listing and sale of the property. C) allow the property to be shown after the seller has been given reasonable notice. D) allow the licensee to preview the property before it is shown to others.

solicit tenants to lease the property before the sale of the real estate.

It is important that sellers not be home during the showing. When the sellers are not present, it allows the buyers to A) make minor repairs or changes to the property. B) discuss with the agent the sellers' true reasons for selling the home. C) move the furniture around to check for stains or defects. D) take psychological possession of the property.

take psychological possession of the property.

The MOST important number to the seller is not the sale price but A) the state deed tax. B) the bottom line or net proceeds. C) the number of points. D) the brokerage fee.

the bottom line or net proceeds.

The net proceeds from a real estate transaction are also called A) the brokerage fee. B) the devil's cut. C) the angel's share. D) the bottom line.

the bottom line.

A listing agreement that has been signed by the seller and the salesperson is an employment agreement between the seller and A) the broker. B) the salesperson and broker (equally). C) the local multiple listing service. D) the salesperson.

the broker.

The seller's property disclosure statement is signed by A) the buyer only. B) the seller and the buyer. C) the seller only. D) the listing broker.

the seller and the buyer.

The VA closing fee must be paid by A) the lender. B) the buyer. C) the loan officer. D) the seller.

the seller.

The listing presentation provides an opportunity for salespeople to demonstrate their real estate knowledge, marketing skills, and sales abilities to A) other agents. B) the seller. C) the appraiser. D) the buyer.

the seller.

The seller's property disclosure statement is filled out by A) the buyer. B) the seller. C) the listing broker. D) the listing agent.

the seller.

A listing contract is a contract between a seller and a broker. True False

true

If the property covered by the listing contract has been destroyed, the listing contract may be terminated. True False

true

Local agents may receive referrals from national relocation companies. True False

true

Local municipalities may have additional inspection or other requirements that need to be met when putting a home on the market. True False

true

One benefit of working with a new agent is that the new agent typically will have more time to service the listing. True False

true

The Internal Revenue Code (Section 1445) requires that, in certain circumstances, buyers of real property must be notified in writing that they must withhold tax if the seller is a foreign person. True False

true

The agent must obtain additional permission from the seller if the seller's home will be advertised on the MLS because the MLS feeds to the internet. True False

true

The listing contract includes the price for which the seller would like to initially list the property. True False

true

The minor-point close uses questions to which The answer is yes. True False

true

The primary purpose of the competitive market analysis is to establish a price range. True False

true

The real estate broker or closing agent may NOT express opinions about the legal effect of the closing documents as stated under applicable state law. True False

true

In order to list homes and work effectively with homesellers, it is important to A) understand the client's real estate experience. B) send your client a gift. C) know what type of car your client drives. D) get to know your client's family.

understand the client's real estate experience.