Exam 3 test
Which homeowners policy is used for mobile homeowners? HO-3 HO-4 HO-6 HO-7
HO-7
Sheila is a new investor who wants to use FHA financing for her first purchase. She doesn't intend to live in the unit, but in order to obtain an FHA loan, she wants to claim that she will. What do you tell her? "Good thinking!" "That's actually mortgage fraud." "We can do that, provided the property is four units or less." "You can't do this, but you could get an FHA loan as a non-owner occupied investor if you put a larger down payment down—at least 10%."
"That's actually mortgage fraud."
If a property has a potential gross income of $50,000, a vacancy and collection loss of 10%, and taxes are another 10%, what's the effective gross income? $40,000 $45,000 $50,000 $55,000
$45,000
What is the average gross leasable square feet for a super-regional shopping center? 1.2 million 775,000 895,000 990,000
1.2 million
An adjustable rate mortgage has an interest rate of 5% and a lifetime cap of 6%. What's the maximum rate that may be charged at any point during the life of the loan? 11% 30% 5% 6%
11%
Alex would like to earn a broker license. To do so, he must be at least ________ years old. 16 18 20 25
20
Houses should be built a minimum of ______ feet away from existing, mature trees. 10 12 20 Six
20
A contractor who violates Article 36-A may be fined from $250 to ____________. $1,000 $2,500 $500 $5,000
2500
Trina has the right to possess a property but she does not own it. What type of interest does she have in the property? A freehold estate A leasehold estate Depreciation Taxation
A leasehold estate
What's a special assessment? A levy local government applies to individual parcels of real estate that will benefit from road or other infrastructure improvements The amount of property value to which the tax rate is applied The probable sales price if the property were listed today and a willing seller and buyer were involved in the transfer of ownership The tax rate which is applied to an assessed value
A levy local government applies to individual parcels of real estate that will benefit from road or other infrastructure improvements
Over time, a river running through Farmer Jones' ranch deposits sediment along the banks of the river and adds half an acre of land to the ranch. This is an example of what process? Accretion Avulsion Erosion Riparian buffering
Accretion
Broker Anna is representing Charlie, who's selling his home. Charlie asks Anna to complete the PCDS form for him. What should Anna tell Charlie? Advise Charlie that he needs to complete the form. She should obey her client. She should tell Charlie that an unlicensed assistant will complete the form for him. Tell Charlie he needs to ask the home inspector to complete the form.
Advise Charlie that he needs to complete the form.
All of the following are true regarding implied agreements EXCEPT which one? An implied agreement is based on actions or behaviors. An implied agreement is based on a formal agreement. With an implied agreement, it's possible that the other party didn't intend to be bound. With an implied agreement, there's an increased chance of confusion.
An implied agreement is based on a formal agreement.
What type of a lease escalation clause is tied to a market index (typically the CPI)? A flat rate lease escalation clause An expense lease escalation clause An index lease escalation clause A profit margin lease escalation clause
An index lease escalation clause
Which of the following persons may file a fair housing complaint on behalf of another? Attorney general Board of REALTORS® State representative U.S. President
Attorney general
What is an appropriation related to taxes? A temporary lowering of property taxes for a specified number of years Authorization for how tax funds are spent within a taxing district The imposition of a tax amount on real property The right to possess a property for a limited time
Authorization for how tax funds are spent within a taxing district
Which deed type may come with or without covenants of warranty? Bargain and sale Full covenant and warranty Quitclaim Referee's
Bargain and sale
Question 11 Hanna represents the buyer, and Hank, an agent from a different firm, represents the seller in the same transaction. What type of agency relationship does Hanna have with her client? Buyer agency Dual-license dual agency Seller agency Single-license dual agency
Buyer agency
Chuck arrives at a vacant home for a showing. He thinks he sees a light on inside the home and distinctly remembers turning off all of the lights when he left yesterday. He decides to be safe and take a walk around the house and discovers a basement window propped open. What should he do? Call the authorities to check it out. Enter the home and wait for the client. Leave immediately without telling anyone. Wait for the client to arrive so that they can enter the house together.
Call the authorities to check it out.
You should be very cautious when approaching a vacant home. If you see anything suspicious, what should you do? Call the authorities to check it out. Enter the home and wait for the client. Leave immediately without telling anyone. Wait for the client to arrive so that you can enter the house together.
Call the authorities to check it out.
The risk that an investor cannot secure financing at an affordable rate is called ______ risk. Business Capital Financial Leverage
Capital
Question 69 Which one of the following says that real estate acquired by either spouse during a marriage (in most cases) is considered community property? Community property rights Joint tenancy Tenancy in common Tenancy in severalty
Community property rights
Which of the following statements about community property rights in New York is false? Community property rights do not exist in New York. Community property rights exist in New York. Married couples acquiring real estate can own it equally. Property owned prior to a marriage can be owned separately.
Community property rights exist in New York.
What type of notice results from publicly recording a title transfer? Actual notice Attorney notice Constructive notice Proper notice
Constructive notice
When referring to private land use restrictions, fence height, additional structures, and architectural design are generally categorized under ______. Codes Conditions Contingencies Covenants
Covenants
Which law or regulation requires supervision by the broker to include regular, frequent and consistent guidance, instruction, and oversight? 1986 New York Independent Contractor Law DOS Regulation 175.21 Internal Revenue Code Section 3508 (a) (b) Sarbanes-Oxley Act
DOS Regulation 175.21
Which of the following is an agreement with your broker that covers the terms of your relationship, including compensation? Contract to work Employment contract Independent contractor agreement Salesperson license
Employment contract
Which one of the following tasks must licensees perform for seller clients? Dictate the listing price of the property. Drive the sellers around to show them other properties that are for sale in their neighborhood. Ensure that the buyer's earnest money is deposited. Show the sellers how they can market their property.
Ensure that the buyer's earnest money is deposited.
What does FEMA stand for? Federal Emergency Management Agency Federal Emergency Management Association Federal Energy Management Association Federal Environmental Management Association
Federal Emergency Management Agency
Joey wants to invest in a regional shopping center. What size trade area can he plan to service? Five to 15 miles Four to 20 miles Three to 25 miles Two to 10 miles
Five to 15 miles
Fair housing complainant Logan filed a federal fair housing complaint against real estate licensee Rich for racial steering. Logan may also file suit at his own expense in the federal district court or the state court within two years of the alleged violation, provided that _______. He has not signed a conciliation agreement He has permission of the Office of Fair Housing He has the signed recommendation of an administrative law judge He is not looking for punitive damages
He has not signed a conciliation agreement
If an investor realized a gain of $140,000 on the sale of an investment property and the depreciated amount was $20,000, what would happen? Investor will pay 15% on the $20,000 and either 20% or 25% on the other $120,000. Investor will pay 25% on the $20,000 and 15% on the other $120,000. Investor will pay 25% on the $20,000 and 20% on the other $120,000. Investor will pay 25% on the $20,000 and either 15% or 20% on the other $120,000.
Investor will pay 25% on the $20,000 and either 15% or 20% on the other $120,000.
What's the purpose of an attornment clause in a lease? It notifies tenants that their lease is still in effect if the building ownership changes. It notifies tenants that the landlord may begin eviction proceedings if the tenant doesn't pay the rent. It provides for the return of the security deposit in the event the building changes ownership. It requires tenants to notify the landlord if guests will stay beyond seven days.
It notifies tenants that their lease is still in effect if the building ownership changes.
Which of the following statements about an easement appurtenant is TRUE? It does not involve an adjoining property. It's an encumbrance on the dominant property. It's a permanent right that runs with the land. It's a temporary agreement between two parties.
It's a permanent right that runs with the land.
When the lender gathers all kinds of information about the borrower's assets, debts, income, employment history, and pulls their credit report, the buyer is ___________________. Approved Making an application for a loan Preparing for the closing Prequalified
Making an application for a loan
The Town Council and Town Board can place a hold on building projects for a specific period of time. This action is known as a ________. Eminent Domain Halt Moratorium Tax hike
Moratorium
Prior to 1950, this organization required its members not to introduce anyone of "incompatible character" to a neighborhood. DOJ FDA KKK NAR
NAR
In which of the following situations can the state use its power of escheat? Hannah passed away with no children and no debt, other than $83,000 left on her mortgage. Maury died, and his three children are upset because his estate isn't large enough to settle all of his debts. Nadine died with no heirs and no debt. Sam died with no will, and his son lives overseas.
Nadine died with no heirs and no debt.
Which type of lease is one in which the tenant pays the rent and some expenses related to the property (e.g., maintenance) separately? Graduated Gross Net Percentage
Net
Margie loves to shop at the neighborhood shopping center near her. The location is so convenient, and the parking lot is easy to get in and out of, even though there can be a lot of traffic at certain times of the day. Where is Margie's neighborhood shopping center located? In the center of an old, established neighborhood, near a park On a corner-lot, at the intersection of two major thoroughfares On the edge of a busy part of downtown, near the train station Several blocks off the main thoroughfare on a four- to 10-acre lot with lots of free parking
On a corner-lot, at the intersection of two major thoroughfares
Salespersons and associate brokers are permitted to accept compensation connected to a real estate transaction from ________. Any licensed real estate broker Only their sponsoring or representative broker Other salespersons and associate brokers Their clients
Only their sponsoring or representative broker
A rate lock is a binding agreement, and if a rate lock expires before funding, the borrower may wish to ______. Let the lock expire and start the loan process over Pay a fee to the lender to extend the lock Terminate the lock Walk away from the closing
Pay a fee to the lender to extend the lock
Familial status includes families with children under age 18 living with parents or a legal custodian, people securing the custody of children, and what other group of people? Children of alcoholics Children of drug abusers Elderly grandparents living with family members Pregnant women
Pregnant women
______ is when there is a request or demand of sexual actions for employment perks or threatening retaliation if sexual favors are not given. Exploitation Hostile work environment harassment Intimidation Quid pro quo harassment
Quid pro quo harassment
Which of the following is a framing member? Footings Rafters Soffits Sticks
Rafters
Conrad just closed on the house he's buying to fix up. Why should he follow up to be sure the deed has been recorded? He can't legally make any improvements to the property until the deed is recorded. He doesn't legally own the house until that occurs. Recording provides actual notice that he owns the property. Recording provides constructive notice that he owns the property.
Recording provides constructive notice that he owns the property.
Which of the following is part of an electrical heating system? A/C vent Blower Register Resister
Resister
Which of these is NOT a common type of well construction? Digging Drilling Sanitation-sourced Spring-sourced
Sanitation-sourced
The Housing and Community Development Act of 1974 added which protected class to federal fair housing law? Color Disability Religion Sex
Sex
Cooperative owners are actually called ______. Investors Real property owners Shareholders Stakeholders
Shareholders
Accident liability, fire, theft, and vandalism are types of _______ risk. Capital Dynamic Environmental Static
Static
Which type of commercial property is designed to expand either up or down? Community shopping center Neighborhood shopping center Strip store Super-regional shopping center
Super-regional shopping center
Eva, Stella, and Lynn owned a vacation home two blocks from the beach. Sadly, Stella passed away over the winter, so when summer arrived, Eva and Lynn shared the home with Stella's nephew Drew, to whom Stella willed her share of the property. What type of ownership is this? Estate in severalty Joint tenancy Tenancy by the entirety Tenancy in common
Tenancy in common
Which of the following is a true statement about U.S. Department of Veterans Affairs loans? All properties are eligible. All veterans are eligible. The VA will guarantee a loan based on the sales price or the certificate of reasonable value (CRV). VA loans can be used for investment properties.
The VA will guarantee a loan based on the sales price or the certificate of reasonable value (CRV).
For real estate agents and brokers working in downstate New York, what is common practice while preparing a sales contract? The buyer's agent completes a pre-printed purchase offer or contract of sale, which is not subject to review by an attorney. The buyer's agent prepares a binder, memorandum of sale, or receipt of sale that specifies the essential terms of the transaction. The buyer's agent prepares a binder, memorandum of sale, or receipt of sale that specifies the essential terms of the transaction, then forwards it to the seller's attorney, who prepares the actual contract. The buyer's agent writes a purchase offer or contract of sale.
The buyer's agent prepares a binder, memorandum of sale, or receipt of sale that specifies the essential terms of the transaction, then forwards it to the seller's attorney, who prepares the actual contract.
Who should display the Equal Housing Opportunity Logo in all advertising and marketing materials? No one The licensee The licensee and the broker The licensee's broker
The licensee and the broker
Using _________, tax rates are expressed as either per $100 or per $1,000 of assessed value. Annual property tax figures Appropriation A tax levy The mill rate
The mill rate
If a minor enters into a contract with an adult, which of the following is true? The adult may legally hold the minor to the contract, but the minor cannot legally hold the adult to the contract. The contract is valid, and both the minor and the adult may legally hold the other party to the contract. The contract is void, and neither the minor nor the adult may legally hold the other party to the contract. The minor may legally hold the adult to the contract, but the adult cannot legally hold the minor to the contract.
The minor may legally hold the adult to the contract, but the adult cannot legally hold the minor to the contract.
Shakira is attending an association meeting when, in a small group breakout, her group begins discussing how to deal with the new kid in town: a real estate firm that charges a flat $500 to list properties, then lets the sellers fend for themselves. Why should Shakira leave the discussion? She needs to get to work developing this model for herself. The group seems bent on creating a tie-in arrangement. This conversation seems to be turning into a discussion of market allocation. This conversation sounds like it might become an antitrust violation.
This conversation sounds like it might become an antitrust violation.
How many anchor stores does a super-regional shopping center normally have? Four or more One or more Three or more Two or more
Three or more
Eminent domain and condemnation occur when the ______ of land is involuntary. Re-survey Rezoning Survey Transfer
Transfer
At what point do most lending issues arise? Credit analysis Loan preapproval Loan prequalification Underwriting
Underwriting
Hope's mortgage created a lien against the property she purchased with the mortgage. What kind of lien is this? General Special assessment Vendor's Voluntary
Voluntary
How often is public water is tested for bacterial contamination? Daily Monthly Twice monthly Weekly
Weekly
Richard has a listing that his seller clients have asked him not to post on the MLS due to privacy concerns. A colleague in his office learns of the listing and has a buyer who might be interested, but Richard prefers to find a buyer for his client himself, and refuses, citing the clients' privacy concerns. Has Richard done anything wrong? No; as an unlisted property, Richard is not required to make it available for showings No, because Richard is only required to allow showings from buyer agents from competing firms Yes, because in New York, listing agents must allow access to their listings by buyer's agents Yes, because you should always allow your firm's licensees to see your listings
Yes, because in New York, listing agents must allow access to their listings by buyer's agents
Hannah, who would like to obtain a broker license, is not a U.S. citizen. Assuming she meets all the other requirements, she can earn a broker license if she ________. is a permanent U.S. resident provides three written references from former clients spends at least one month annually in the U.S. spends at least two weeks annually in the U.S.
is a permanent U.S. resident
Which of the following provides an opinion of list price range by looking at recently sold properties, comparing current competing properties and properties that didn't sell, and estimating buyer appeal regarding the style, location, and size? Appraisal Broker price opinion Collective market analysis Comparative market analysis
Comparative market analysis
Danielle's friend, Joanna, is an agent. Danielle is considering listing her property and shares the details with Joanna. Joanna creates an MLS listing and places a sign in Danielle's yard. Danielle knows that Joanna will do a good job, so even though she hadn't actually agreed to let Joanna list the property, she permits her to start scheduling showings. Which of these is an example of ratification? Danielle knows Joanna will do a good job, so she permits Joanna to start scheduling showings. Danielle sues Joanna because Joanna didn't have Danielle's permission to list the property. Joanna presents several offers to Danielle. Joanna schedules an open house at Danielle's property.
Danielle knows Joanna will do a good job, so she permits Joanna to start scheduling showings.
Broker Adeline's firm has a listing for a condo downtown. Maurice is a cooperating agent. What does this mean? He doesn't mind working with other brokers. He's from another brokerage and brings a potential buyer for the listing. He's the listing agent for the condo and also represents a buyer interested in the condo. He works at Adeline's firm and is helping to market the condo listing.
He's from another brokerage and brings a potential buyer for the listing.
Which lease clause verifies facts that are already in writing? Attornment Estoppel Remainder Repeat
Estoppel
What percentage of a worker's income must come from production in order for the worker to qualify as an independent contractor? 50 51 75 90
90
What is misrepresentation? An inadvertent misstatement of fact only An intentional misstatement of fact only An intentional or inadvertent misstatement of fact A statement of opinion or exaggeration that's generally understood to not be a statement of fact
An intentional or inadvertent misstatement of fact
Brandy is going to purchase a strip mall. She is trying to determine exactly how much to borrow for this purchase. She understands that the more she borrows, the greater her risk. What type of risk is she evaluating? Business risk Capital risk Dynamic risk Financial risk
Financial risk (Borrow)
What tax will the cooperative impose on the sale of individual units within the property? Cooperative tax Excise tax Flip tax Sales tax
Flip tax
At a listing appointment, licensee Chet asks Sam, the seller, if his property is his own home or an investment property. Why would Chet ask this? Chet can only represent sellers if they're selling their own home; selling investment properties requires a different license. If the home is his own, he's likely to be purchasing a new one, so Chet has a chance to land two transactions. Investment homes are easier to sell because they're sold "as-is." Investment home sellers tend to be more emotionally attached because the homes bring them more income.
If the home is his own, he's likely to be purchasing a new one, so Chet has a chance to land two transactions.
What's a possible effect of ongoing litigation on condo sales transactions? Lawsuits have no effect on condo sales. Lenders won't lend on properties involved in litigation. Owners aren't allowed to sell if their associations are involved in a lawsuit. Owners who want to sell have to pay extra legal fees on top of their association dues.
Lenders won't lend on properties involved in litigation.
When might the buyer be required to carry mortgage insurance to protect the lender from buyer default? Buyer(s) under the age of 21 Foreclosed property Less than a 20% down payment Low credit scores
Less than a 20% down payment
In a purchase offer, is earnest money required in order to have a binding contract? No, because earnest money isn't part of a sales contract. No, because the buyer's consideration is the promise to buy. Yes, because it opens escrow. Yes, because it's the buyer's consideration.
No, because the buyer's consideration is the promise to buy.
Zack represents a seller and receives an offer through another agent. The offer is higher than the listing price. The property is already listed at a very high price, and no other offers have been received. Is Zack obligated by his duties to the other party to disclose that the offer is too high? No, but Zack should honor his duty to all parties by asking his client to decline the offer. No, his fiduciary duty is to his own client. The buyer's agent must be responsible for advising on a fair price for the property. Yes, Zack must be honest and fair with all parties in the transaction. Zack can request that both parties consent to dual agency so that he can negotiate an honest price that will be fair to all.
No, his fiduciary duty is to his own client. The buyer's agent must be responsible for advising on a fair price for the property.
Which of the following applies to prepayment penalties? Lenders are now required to charge prepayment penalties for debts exceeding $1.1 million. New York only allows prepayment penalties during the first year if the interest rate is fixed for at least the first three years New York prohibits prepayment penalties Qualified Mortgage rules prohibit lenders from charging prepayment penalties in most situations
Qualified Mortgage rules prohibit lenders from charging prepayment penalties in most situations
Some first-time homebuyers tap into the bank of mom and dad. In what circumstance would the parents' contribution be acceptable for loan qualification? A balloon payment must not apply for the first three years. Interest rates for the loan must not exceed 3%. The borrower receives cash at closing. The money is given as a gift with no expectation of repayment.
The money is given as a gift with no expectation of repayment.
In which of the following states are you likely to encounter a property description created using the metes and bounds system of surveying? All states acquired in the Louisiana Purchase. All states that share a border with Canada Most states in the Mountain time zone The original 13 colonies
The original 13 colonies
Seller Jamison is closing on his property with buyer Conrad. Jamison paid the current year's property taxes already. Is this a prepaid or accrued expense, and how will it be represented on the settlement statement? The taxes are an accrued expense, and will appear as a buyer credit and a seller debit. The taxes are an accrued expense, and will appear as a buyer debit and a seller credit. The taxes are a prepaid expense, and will appear as a buyer credit and a seller debit. The taxes are a prepaid expense, and will appear as a buyer debit and a seller credit.
The taxes are a prepaid expense, and will appear as a buyer debit and a seller credit.
Which of the following statements applies to independent contractors? Their broker sets their work hours. Their broker supervises them. Their work must be done in a specific location. They're paid by the hour, not by the job.
Their broker supervises them.
To whom must a licensee, representing a buyer, disclose agency status? All parties in the transaction Broker Buyer Seller
All parties in the transaction
To protect yourself and your broker, where should the fair housing poster be displayed? Anywhere the firm does business In the branch offices In the main office In the model home office
Anywhere the firm does business
How does New York ensure that the property taxes levied against approximately 4 million property owners are fair and equitable? Assessment Review Board Equalization program RARs and Assessment Review Board Residential assessment ratios
Equalization program
What may be the result if a tax assessor discovers an undeclared improvement? A moratorium on future building, fines and back taxes, redoing the work according to permit A moratorium on future building, fines and back taxes, redoing the work according to permit, and jail time Fines, back taxes, and redoing the work according to permit Jail time
Fines, back taxes, and redoing the work according to permit
Which structural component is described as "the concrete base that supports the foundation of a building"? Beam Footing Foundation Lally column
Footing
Which of the following individuals would be a competent party to a contract? Byron, a 17-year-old MENSA member Claudia, a 37-year-old in-patient receiving treatment for schizophrenia Graciella, a 28-year-old unemployed parolee Norman, a 40-year-old heroin addict
Graciella, a 28-year-old unemployed parolee
Which of the following license types involves closely examining the condition of real property? Apartment information vendor Appraiser Home inspector Mortgage broker
Home inspector
Which of the following is a true statement about deducting interest on mortgages taken out in tax years between 2018 and 2025? Interest on the first $500,000 of mortgage debt is deductible for married couples filing jointly or $375,000 for married couples filing separately. Interest on the first $750,000 of mortgage debt is deductible for married couples filing jointly or $375,000 for married couples filing separately. The loan can be used for purchase or making improvements, as well as for other purposes. The loan cannot be for more than the borrower's most recent year's salary.
Interest on the first $750,000 of mortgage debt is deductible for married couples filing jointly or $375,000 for married couples filing separately.
The transfer of land through eminent domain or condemnation is known as what? Dedication Involuntary alienation Reliction Voluntary alienation
Involuntary alienation
Which of the following describes a deed restriction? It can be placed on a single property, an entire subdivision, or a neighborhood. It ensures compliance with zoning and public safety and preserves property value. It must be placed by the property owner within one year of purchasing the property. It's limited to three years in duration.
It can be placed on a single property, an entire subdivision, or a neighborhood.
Frieda is practicing dual agency, and neither party seems to mind, even though she didn't obtain written informed consent. Is this legal? It's only legal if she doesn't get caught. No. Dual agency is always illegal. No. Without informed consent, it's illegal. Yes, if the parties are agreeable.
No. Without informed consent, it's illegal.
Why can't licensees customize real estate contracts any way they want? Real estate contracts are between buyers and sellers; the only people who can customize these contracts are the parties who are actually involved in the transaction. Real estate contracts are standardized throughout the U.S.; if a real estate licensee changes a contract in New York, every contract in every state must be changed to match it. Real estate contracts need to be easily understood by all parties involved; real estate licensees must take a special class to learn to write clearly before they can customize standard contracts. Real estate sales contracts are legal documents; real estate licensees could be guilty of practicing law without a license if they customize contracts using nonstandard language.
Real estate sales contracts are legal documents; real estate licensees could be guilty of practicing law without a license if they customize contracts using nonstandard language.
Why should sellers remove family photos and other personal items prior to showings? Because family photos are old fashioned. So that buyers can picture their own items in the home. So that no one steals important photos. To protect themselves from visitors with criminal intent.
So that buyers can picture their own items in the home.
A taxpayer filing a grievance for an unlawful assessment would use what as evidence? A)The property wasn't located within the tax assessor's jurisdiction. B)The tax assessment did not include square footage, lot size, and the amenities for the property. C)The tax assessment was done past the deadline. D)The tax assessment was not a comparison with neighboring parcels.
The property wasn't located within the tax assessor's jurisdiction.
What does the quick and dirty 70% formula mean to investors? That 70% of renters will leave in the first two years That 70% of their income will go toward expenses The purchase price shouldn't be more than 70% of the repaired value They must receive 70% return on their investment
The purchase price shouldn't be more than 70% of the repaired value