Legal Aspects of Real Estate

A court-annexed arbitration may be ordered by the superior court when there is less than:

$50,000 at stake

Under California law, which of the following are true?

-Landlords can prohibit smoking on the property -landlords are prohibited from requiring pets be declawed or devocalized

A litifant is:

-the plaintiff -the defendant

___ is the minimum number of investors that a real estate investment trust (REIT) must have?

100

To make a valid contract, a person generally must be:

18 years old

For many oral contracts involving real property, any lawsuit must be filed within:

2 years of the breach

In California, a lawsuit based on a written contract generally must be filed no later than how many years after the breach occurred?

4 years

The first installment on property taxes is delinquent if not paid by:

5pm on December 10

Which of the following is a type of map that can only be filed for a subdivision with two-to-four lots?

A parcel map

Which of the following describes an arrangement where the buyers purchase the exclusive right to the possession of the property for specified periods each year?

A timeshare

Which of the following is NOT a test for a fixture?

Age of the fixture

To make an option irrevocable, the option must be supported by:

All of the above - a signed contract -a property description -terms of the sale

Which of the following Commissioner's Regulations explain the duties of real estate agents in regard to unlawful discrimination?

All of the above -2780 -2781 -2725

Under CALGreen:

All of the above -California became the first state to adopt a green building code -minimum uniform standards for green building that apply to many types of construction were established -developers must divert 5 0 percent of construction waste from landfills through recycling or re-use materials

The National Environmental Policy Act established the:

All of the above -EPA -CEQ -EIS

Which of the following is true with regard to the Civil Rights Act of 1866?

All of the above -It only prohibits discrimination based on race or ancestry -it applies to any real estate transaction -there are no exceptions

In California, title can be acquired by adverse possession if the possession is:

All of the above -actual, open, and notorious -hostile to the owner's interest -exclusive and uninterrupted for five years

The standard purchase agreement contains:

All of the above -an offer to purchase real property -a receipt for the good faith earnest money -the seller's agreement to pay listing broker's compensation

Amendments to the Constitution guarantee which of the following with regards to property and the real estate profession?

All of the above -due process -equal protection -just compensation

A restrictive covenant can be terminated by:

All of the above -expiration -merger -abandonment

An agency may be created by:

All of the above -express agreement -ratification -ertoppel

Which of the following is NOT subject to property taxes?

All of the above -federal property -state property -educational property

A standard title insurance policy covers:

All of the above -forged deeds -recorded encumbrances not listed as exceptions -forged deeds

A fee simple estate is:

All of the above -inheritable -transferable -perpetual

A court decision may be binding on all other judges. It depends on:

All of the above -jurisdiction -position in the court hierarchy -a written opinion

Many final subdivision maps include which of the following?

All of the above -measurements of area -easement locations and dimensions -location of survey markers

The landlord, to make the property tenantable, must:

All of the above -provide effective waterproofing -provide plumbing and heating -make sure the common area is free from trash

The Federal Fair Housing Act prohibits discrimination based on:

All of the above -race -religion -familial status

An agent owes his or her principal the basic fiduciary duty of:

All of the above -reasonable care and skill -diligence, good faith, and loyalty -disclosure of material information

Which of the following is a water right?

All of the above -riparian -overlying -appropriative

Who can be held liable for unlawful discrimination?

All of the above -seller/landlord -property manager -rental agent

An opinion written by a court states:

All of the above -the decision -the facts of the case -the court's reasoning

Joint tenancy requires unity of possession and:

All of the above -unity of interest -unity of time -unity of title

Which of the following makes the client liable for a commission during a specified period after the listing expires?

An extender clause

A buyer is considered "able" if he or she has which of the following?

Any of the above -Enough cash to complete the sale -A strong credit rating and adequate personal assets -a binding commitment for a loan to finance the purchase

Which of the following can sue for violations of anti-discrimination laws?

Any of the above -State Attorney General -U.S. Attorney General -Tester

Which of the following does NOT require a real estate license to represent another in a specific real estate transaction?

Any of the above -attorney -trustee -executor

An agency is terminated by operation of law if:

Any of the above -either party dies -either party goes bankrupt -the agent loses his or her license

A payment from the Real Estate Recovery Fund must be based on a judgment against a real estate agent for:

Any of the above -intentional fraud -misrepresentation or deceit -conversion of trust funds

Actual fraud involves:

Any of the above -intentional misrepresentation -concealment -negligent misrepresentation

An emancipated minor is a person under the age of 18 who:

Any of the above -is married or has been married -is on active duty with the armed forces -has received a court declaration of emancipation

Generally, a seller or agent can't be sued for misrepresentation if his or her statements were merely:

Any of the above -opinions -predictions -puffing

A restrictive covenant may run with the land if it:

Any of the above -relates to the use of the property -relates to the repair, maintenance, or improvement of the property -directly benefits the property

A tenant in common is free to:

Any of the above -sell his or her interest -will his or her interest -encumber his or her interest

California became the first state to adopt a green building code through:

CALGreen

The California law that is similar to the National Environmental Policy Act is the:

CEQA

Which of the following is NOT a type of lease?

Decimal

Which of the following Acts applies to the extension of credit?

Equal Credit Opportunity Act

Title VIII of the Civil Rights Act of 1968 is commonly called the

Federal Fair Housing Act

Which of the following is NOT an agent's duty to a third party?

Fiduciary relationship

When subdivision property in one state is offered for sale in another state, a developer may have to comply with the:

Interstate Land Sales Full Disclosure Act

Which of the following is NOT a requirement for acceptance of an offer?

It can only be accepted by the offeror

Most legislation becomes effective:

January 1 of the next year

Which organization would oversee the merging between two communities?

LAFCO

The most widely recognized code of ethics in the real estate industry is the:

NAR Code of Ethics

Which of the following gives someone other than the owner a right to do something on the land or take something from the land?

Positive easement

Which of the following lines do NOT run east and west?

Principal meridians

A client who is awarded damages against a real estate agent based on fraud, but is unable to collect, may be entitled to payment out of the:

Real Estate Recovery Account

The Act that requires all states to implement a licensing system for residential mortgage loan originators is the:

SAFE Act

Which of the following is NOT a federal law or regulation designed to eliminate discrimination in lending?

The Civil Rights Act of 1776

Which of the following would NOT generally be charged to the buyer in escrow?

The broker's commission

Which is NOT a RESPA requirement?

The lender may pay referral fees to anyone

Which California Act prohibits discrimination by business establishments?

Unruh Act

The Housing Financial Discrimination Act allows:

a financial institution to take the fair market value of the property into consideration when deciding on a loan

The exclusive right to sell agency listing must contain:

a termination date

A permit that allows an owner to build a structure or use a property in a way that isn't otherwise allowed is called:

a use variance

When a borrower defaults and the lender has the right to declare the entire balance due immediately, the loan has a(n):

acceleration clause

When something is added to a parcel of real property, the property owner acquires title to the addition by:

accession

A hearing procedure by the Real Estate Commissioner to suspend or revoke a real estate license is initiated with the filing of a(n):

accusation

When a document has been signed in front of a notary public, it is said to be:

acknowledged

When a broker exaggerates the market value of the property in order to get a listing, he or she breaches his or her duty to:

act in good faith

The laws adopted by Congress and the state legislatures are called:

acts or statutes

Where damages are concerned, the closest word to "compensatory" is:

actual

Authority intentionally given by the principal to an agent is called:

actual authority

An amendment to a will is called a(n):

addendum

If a spouse with two children dies intestate, the deceased spouse's interest in the community property will be distributed with:

all of it going to the surviving spouse

The transfer disclosure statement is usually signed by the:

all of the above

A state tax lien would be junior to the recorded interest of a:

all of the above -mortgage or trust deed lender -mechanic's lien holder -judgment lien creditor

A real estate agent representing a seller should be especially careful to inform the principal of:

all of the above -the true value of the property -all offers to purchase -the identity of the purchaser

A power of sale clause:

allows the trustee to sell the property in case of default

A credit is a(n):

amount received

The tax on a parcel of real estate is calculated by multiplying the tax rate by the:

assessed (taxable) calue

An arbitrator's decision is called a(n):

award

In a listing agreement for the sale of four or less residential units, a broker's commission must:

be negotiable between the seller and the broker

A breach of a legal duty may result in all of the following, except:

beneficial damages

A proposed law in Congress is called a(n):

bill

Generally, most arbitration proceedings are:

binding

The rules of law developed by judges are called:

case law

When a mediator meets with one of the parties to get them to focus on their interests and needs, it is called a(n):

caucus

A tort is a:

civil wrong

The agency disclosure form is NOT required for the sale of a:

commercial property

Long established rules derived from judicial decisions fofunded on English law are sometimes referred to as:

common law

A form of co-ownership that can only be held by spouses and registered domestic partners is called:

community property

The owner's title is provisional (subject to forfeiture) when a deed contains a:

condition

When a promisor's obligation depends on the occurrence of a particular event, that event is called a:

condition

Most agreements between buyers and sellers are:

conditional

A contractual promise is distinguished from the promise of a gift by the exchange of:

consideration

Notice given by the recording of documents with a public official which is something you should know about, but don't actually know about, is called:

constructive notice

Escrow instructions can also act as a(n):

contract of sale

An important difference between a grant deed and a quitclaim deed is that the grant deed:

conveys after-acquirerd title

When an offeree varies any of the terms in an offer, it is called a:

counter offer

Unlike an easement, a license does NOT:

create an interest in the property

A court order directing a breaching party to pay a sum of money to the nonbreaching party is called:

damages (money)

A person gives a gift of privately owned land to the public through:

dedication

With a general partnership, the liability for debts of the partnership lies with:

each individual partner

When someone creates an easement by making long and continuous use without the permission of the owner, it is called:

easement by prescription

Severance, with regards to joint tenancy:

eliminates the right of survivorship

In a land contract, the buyer holds:

equitable title

When property reverts to the state because no heirs can be located, it is called:

escheat

Escrow agents' written authorization to deliver the deposited funds and documents are called the:

escrow instructions

A leasehold estate for a fixed time period is a(n):

estate for years

A real estate license must be renewed:

every 4 years

To transact business using a partnership name, the partners must publish and record a:

fictitious business name certificate

A corporation organized under the laws of another state is a:

foreign corporation

A broker must keep records of each transaction for at least three years beginning:

from the closing date

Natural attachments that are planted and cultivated are called:

fructus industriales

A document stating that the debt secured by the deed of trust has been discharged is called a:

full reconveyance

Irregular sections are called:

government lots

In reference to a deed, the owner of the property who is transferring title is called the:

grantor

Under the compensation provision of the CAR purchase agreement, if the buyer defaults, the broker is entitled to:

half of the damages the seller receives

Under the compensation provision of the CAR purchase agreement, if the buyer defaults, the broker is entitled to:

half of the forfeited deposit

With an independent contractor:

he or she does not work hours set by the employer

A will only transfers property

if it is oral

A written contract can be modified orally:

if new consideration is supplied

Under the Mortgage Loan Broker Law, a disclosure statement is NOT required:

if the lender is an institutional lender

A trust account maintained by the lender for paying property taxes and mortgage insurance premiums is a(n):

impound account

With few exceptions, a California broker's client trust account must be maintained at a financial institution:

in California

In southern California, escrow services are most often provided by:

independent escrow companies

A court order directing a person to do something or refrain from doing something is called a(n):

injunction

The escrow agent turns the escrow funds over to the court to settle a dispute in a(n):

interpleader action

The key difference between a mortgage and a trust deed is that only a trust deed

is usually foreclosed nonjudicially

One spouse can't give away community property without the other's consent. This falls under the:

joinder requirements

Taking away property through an eminent domain action must include:

just compensation

Support from adjacent land is called:

lateral support

When the contract is made, the "purpose" of a contract must be:

lawful

When the parties agree in advance to set damages at a specified sum , the contract is said to contain a(n):

liquidated damages clause

An employment agreement between a seller and a broker is called a:

listing agreement

After the purchase price, the buyer's second largest debit at closing is typically the:

loan origination fee

A bench mark is a(n):

marker that states the location relative to the datum

A neutral third party assists the parties in voluntarily negotiating a settlement to the dispute in:

mediation

A section, of a written contract that allows for mediation should a dispute arise is called a(n):

mediation clause

The oldest method of describing land is:

metes and bounds

The borrower in a mortgage is called the:

mortgagor

For a contract to be a binding obligation, all the parties:

must consent to its terms

The primary method by which conflicts are resolved is:

negotiation

A void contract is:

no contract at all

A binding arbitration is:

not reviewable by the courts

To start the foreclosure process, the beneficiary asks the trustee to record a:

notice of default

A device that substitutes a lease with a new lease between a landlord and a different tenant is called a:

novation

A contract giving one party the right to do something without obligating him or her to do it is a(n):

option

The seller's major cost at closing is usually the:

payoff of any existing loans

If one party refuses to comply with the arbitration award, the other party may file with the court a:

petition to confirm

In a smaller community, the city council will often act as the:

planning commission

The starting point of a metes and bounds description is called the:

point of beginning

With a promissory note, the loan amount is called the:

principal

All of the following can be adversely possessed, except:

public lands

The seller's major credit in escrow is the:

purchase price

When a person acts on another's behalf without agency authorization, and later the principal approves these actions, it is known as:

ratification

A declared homestead exemption is established by:

recording a declaration of homestead

The government survey system is also called the:

rectangular survey method

Refusal, for discriminatory reasons, to make loans on property in a particular neighborhood is called:

redlining

The SAFE Act:

requires all states to implement a licensing system for residential mortgage loan originators

When private restrictions on the use of property are simply a contract between an owner and the neighboring owner, it is called a(n):

restrictive covenant

A unilateral termination of the agency relationship by the principal would be achieved through:

revocation

An amendment to the zoning law is called a:

rezone

Someone who has the right to buy a property only if and when the owner decides to sell it is said to hold a(n):

right of first refusal

The fact that a property owner who drills a well on his or her land owns all of the oil and gas the well produces, falls under the:

rule of capture

When the agent buys a property for himself or herself (without the owner's knowledge) and then sells it again for a profit, it is called:

self-dealing

The documentary transfer tax is ordinarily paid by the:

seller

The land burdened by an easement is called the:

servient tenement

Procedural law:

sets out the methods of enforcing substantive rights

A real estate agent/broker with authority limited to the single transaction of selling a particular house is a:

special agent

A property tax is actually a:

specific lien

When the court orders a breaching party to carry out the performance he or she promised in the contract, it is called:

specific performance

The term "parol" most closely means:

spoken

The most significant factor in estimating a closing date is the:

state of the finance market

A license hearing process to deny issuance of a real estate license is initiated by the commissioner filing a:

statement of issues

Channeling prospective buyers or renters to specific neighborhoods based on their race is an example of:

steering

A promissory note that includes periodic payments of interest only is called a(n)

straight note

If no arbitration clause is in a contract, the parties can still go to arbitration by executing a(n):

submission agreement

A subpoena for books and records is called:

subpoena duces tecum

The most basic form of concurrent ownership is:

tenancy in common

A case will NOT necessarily be heard in state court if:

the U.S. government is a party

Litigants are able to find out more about the disputed facts in a case through:

the discovery process

When title passes on the date the deed or funds were deposited in escrow, instead of the date all conditions were performed, it is known as:

the doctrine of relation back

The duration of a life estate is based on:

the length of someone's life

With a limited partnership:

the limited partners have limited liability

If a cooperating broker is the procuring cause in bringing about the sale of the property, who pays him or her a share of the commission?

the listing broker

An appellate court will NOT change a trial court's decision if:

the losing party considered the jury incompetent

When a new owner assumes an existing lien:

the new owner takes responsibility for the lien

The sum of all fees the lender charges a borrower in exchange for granting the loan is the:

total finance charge

The square of land located at the intersection of a range and township tier is called a:

township

Fixtures installed for use in a tenant's business are called:

trade fixtures

When a couple changes a joint tenancy agreement to community property, it is called a(n):

transmutation agreement

Refusal to sell or rent after receiving a good-faith offer, if it can be shown that the offeror's race, religion, sex, national origin, or disability was a factor, is:

unlawful

Refusing to deal with someone who has sued you for discrimination may be considered

unlawful retaliation

A mortgage is an example of a(n):

voluntary lien

Acceptance of a transfer of ownership must take place:

while the one granting is alive

Integrative negotiation can best be described as:

win-win

A listing agreement can only be assigned to another broker:

with the client's consent