CA Mock Exam
The typical height of a ceiling in a conventional single-family home is:
96 inches.
What kind of agency is a listing?
A special agency
To which of the following does a real estate agent owe a fiduciary duty?
Principal
The opposite of erosion is:
accretion
When acting as a listing agent, a real estate broker is liable to third parties for:
his or her own torts.
An agent who pays part of the commission to the buyer:
must inform the seller.
All of the following statements concerning agency relationships are correct, except:
net listings are encouraged in California, because they avoid conflicts of interest in the agency relationship.
When a real estate agent acts as a dual agent for both the buyer and seller in a 1031 exchange, and does not disclose his dual agency to both parties, he may:
provide grounds for either party to rescind the purchase agreement. be prevented from receiving any commission. be disciplined by the Real Estate Commissioner.
Upon foreclosure sale by way of trustee sale, a trustee must wait at least three months before:
publishing the notice of trustee sale.
By accepting the actions of an agent, even though there is no contract, a seller may create an agency by:
ratification
Emblements include:
the right of a tenant farmer to harvest his or her crops even though the lease may have expired.
"A" deeds a property to "B" who takes possession of the property but fails to record his deed. "A" then deeds the same property to "C" who bought the property without inspecting it. However, "C" recorded his deed. Who owns the property?
"B" has a valid title.
If a salesman is to receive 25% of his brokers 6% commission, how much would he receive on a parcel with 900 front feet that sold for $150 a front foot?
$2,025
Ted purchased a building for $250,000. The terms of purchase were $175,000 cash, and a purchase money deed of trust for the balance. If the land is valued at $50,000 what is the adjusted cost basis of the property after it is fully depreciated?
$50,000, the value of the land.
Inventory in a store cost $9,200 net. It was sold for 25% profit; however, 15% of the gross profit was lost due to bad credit risks over a period of one year. How much profit did the store owner make that year?
1,955
The number of linear feet on each side of 2 acres of land that is almost square would be approximately?
295
The real estate listing is classified as an employment contract under whose terms the owner of the property appoints and authorizes a real estate broker to act as his or her agent. Which of the following statements is CORRECT?
A broker has an enforceable right to a commission in an open listing if he is the "procuring cause" even if the owner sells through another broker.
The Real Estate Law defines a planned development as which of the following?
A subdivision
Under Article 3, Section 10176, of the California Real Estate Law, a broker could not be disciplined for which of the following?
Acting for more than one party in a transaction with the knowledge and consent of all parties thereto
Wills play a very important part in the transfer of title to real property. Which of the following would not be a party to a will?
Administrator
Which of the following forms must be completed before an offer can be written?
Agency disclosure
Which of the following is not essential to the creation of an agency relationship?
Agreement to pay consideration
Which of the following would not be essential in order to create an agency relationship?
An agreement to pay commission
An agency relationship is said to create a fiduciary relationship between principal and agent. Of the following relationships, which illustrates a fiduciary responsibility?
Any trustee to a beneficiary Real estate broker to his client
Once an offer has been communicated to the offeree, it does not stay open forever. Which is NOT a way to terminate an offer?
Capacity of either party
Which of the following is true of a buyer's agent?
Compensation may not necessarily come from the buyer
The age of a single family residence could best be determined by the:
County Assessor's records.
Under the provisions of FHA the borrower is required to pay the non-recurring closing costs unless the seller agrees to pay part or all of them. Which of the following are not considered non-recurring closing costs?
Currently due property taxes and hazard insurance on property
What event does not terminate (or dissolve)an agency?
Death of listing agent (not broker)
Which one of the following clauses is always in a deposit receipt?
Executory clause
Which of the following is true of a limited partner?
He or she is liable only for the amount of his or her contribution
A licensee listed a property, promising the owner she would advertise the home using weekly display ads in the Sunday real estate circular. The owner relied on the promise of the real estate agent and listed the home because of it. If the agent never intended to advertise the property in the Sunday circular because of the extra expense, which of the following is true?
It would be actual fraud
Who benefits from a prepayment penalty?
Lender
Placido has set an asking price of $78,200 for his 9 acres of land. His friend, Luciano, wants to buy a portion of this land measuring 100' by 145.2'. Assuming Luciano pays Placido's asking price on a square foot basis, how much will Luciano pay?
More than $2,500, but less than $3,000
In describing an agency contract, which is most nearly correct?
Most multiple listings are exclusive listings
Mr. and Mrs. Carr listed their property with broker Smith. Some years ago they homesteaded the property and subsequently, a creditor secured a $15,000 judgment against the property, which has not been satisfied in any way. There is a purchase money trust deed with a $165,000 balance against the property. The broker sells the property for $200,000 cash. How much would be applied to the $15,000 judgment?
Nothing
Under the law, there are certain instruments that are not effective against mechanic's liens. Which of the following would be effective against a mechanic's lien?
Notice of non-responsibility
Which of the following is not required of a licensee under the current agency disclosure law?
Representation
Michelle, a real estate broker, sold a condo that was listed by a broker from another company. What is her relationship to the listing broker?
Selling broker
Jane offers to purchase Stan's property for $139,000. Jane takes title subject to a VA loan. What is the effect on liability?
Stan is liable for the loan
The initials "I.R.E.M." stand for:
The Institute of Real Estate Management.
If a broker dies after he or she has taken a listing, what happens to the agency relationship it created?
The agency immediately terminates.
When a broker is representing the buyer exclusively under a buyer agency contract, which of the following is true?
The buyer's broker has no liability for acts of the listing broker
In a real estate contract, the promise to use "due diligence" is made by whom?
The listing broker
Broker Bob collected rents from an apartment house under agreement with the owner. He had been collecting rents on the 1st of each month for several months and as of July 1, he had collected all but one. On July 2 the owner died. On July 3 the broker went to collect the last rental but the tenant refused to give the rent to the broker on the grounds that the owner had died and, therefore, the agency between broker and the owner was terminated. Which of the following is correct?
The tenant is correct When may a real estate broker, acting as agent for the seller, refuse to submit a buyer's offer?
Which of the following is closest to the same relationship as between a broker and seller?
Trustee and beneficiary
Fiduciary applies to the relationships between people in many different positions. It does not apply to which of the following?
Trustor to beneficiary
When a building earns sufficient income to justify its continued operation, this is called:
When a building earns sufficient income to justify its continued operation, this is called:
Which of the following statements about escrow procedures is true?
When the escrow requirements have been met, the escrow agency changes from a dual agency to a separate agency
When may a real estate broker, acting as agent for the seller, refuse to submit a buyer's offer?
When the owner has given broker express instructions not to submit any further offers
In considering a bilateral contract, the offered promise bargains for receipt of a returned promise. If the return promise is given, it is considered:
a consideration.
As a real estate licensee, you will often be asked to explain a Declaration of Homestead. All of the following are correct statements concerning this protection except:
a declaration is not valid unless recorded prior to the filing of a court action.
In the preparation of an exclusive listing contract, a licensee may be disciplined if he fails to include:
a definite expiration date.
California Real Estate Law imposes upon a real estate agent the highest obligation of undivided interest and loyalty to his principal. This relationship is comparable to that of:
a trustee to his beneficiary.
When a real estate agent acts exclusively as a buyer's agent, he can do all of the following except:
act as an exclusive agent of the seller.
A fiduciary relationship may be terminated by:
agreement. revocation. death
The relationship of a real estate salesperson to his or her broker under the License Law is as:
an employee.
A person designated in a written power-of-attorney, to legally act for another in his stead is typically called a(n):
attorney-in-fact.
When a seller carries back a note secured by a deed of trust from the buyer, the seller becomes the ___, and the buyer becomes the ___.
beneficiary, trustor
The primary mortgage market is the market in which lenders make loans directly to the:
borrowers.
Which of the following statements is correct? Escrow cannot be completed or terminated:
by the broker advising the escrow holder to cancel the escrow.
A lender would revise the Loan Estimate for any of the following reasons, except:
changed circumstances affecting eligibility of the seller.
A licensee who misrepresents property to the buyer while acting as an agent of the seller, is subject to:
discipline. civil lawsuits. criminal penalties.
A grant deed that allows someone to retain property so long as alcohol is not consumed on the property is:
fee simple defeasible.
A broker who is employed by the seller is liable to the buyer if:
he acts in excess of the terms of his contract.
A married man died without leaving a witnessed will. However, after his death his wife found a statement naming his son as executor and expressing his wishes for the disposition of his estate. It was dated three years previously and was entirely written and signed by him in pencil. This would mean:
his death would be classified as testate. However, any real property would have to be probated in whatever state it is located.
The difference between real and personal property is that real property is:
immovable.
Depreciation on real property is an allowable deduction for income tax purposes if the real property is:
improved
The Northern Telegraph Company has secured the right to place telegraph lines across the back of various residential properties. They have acquired an easement:
in gross.
Mia is owner of a home which she has agreed to sell to Peter. A preliminary title report which was prepared during escrow shows:
information about a deed of trust with Mia as trustor.
The largest loans would most likely be made by a(n):
insurance company.
Broker White obtained a deposit from buyer Farley. The seller did not accept the offer, however, and broker would not return deposit. Farley contacted the Real Estate Commissioner. The Commissioner can:
investigate as required by real estate law.
Advertising without including a designation disclosing that he or she is performing acts for which a real estate license is required:
is a violation. warrants disciplinary action.
Acting for more than one party in a transaction:
is within the law.
When a trust deed is sold, the parties use an escrow in order to:
make sure that conditions and terms are met prior to the settlement of the transaction.
Broker Jones secured an agency listing in writing from the Johnson Co. on a commercial building that had been vacant for some months. The listing broker entered into a verbal agreement to share his commission with a cooperating broker. The cooperating broker procured a buyer, but broker Jones refused to split the commission. The cooperating broker:
may recover his share in court.
Conversion is a violation of the Real Estate Law. If a broker is sued for conversion, he is alleged with:
misappropriating client's funds.
Assume you are employed and compenstated by an insurance company to originate first trust deed loans. This activity requires:
no license at all.
"A" has given "B" the impression that "X" is "A"'s agent even though "X" was never given the authority to represent "A". From "B"'s standpoint, the agency is:
ostensible
Will needs $2,000 to close an escrow. He holds a $6,000 promissory note secured by a second mortgage on a farm. Manny agrees to lend him the necessary amount if Will puts up the note as security. This type of security is known as a:
pledge.
In tenancy in common there is always a unity of:
possession.
An agent who acts exclusively as the agent for the buyer may:
present offers to the seller with the seller's agent present.
The person who gives authority to an agent to represent his or her interests in dealing with a third party is the:
principal
An agency relationship, such as in a listing, may be terminated by all of the following methods except:
revocation by the principal if the agent has an interest in the subject matter of the agency.
Broker Jones had signed an agreement to locate some property for her principal. Having found a property which suited the principal, Broker Jones determined that it could be purchased for less than her principal was willing to pay. She then bought the property and later sold it to her principal at the higher figure and kept the difference for herself. This would be called:
secret profit.
A real estate broker negotiated the sale of a home. Title was deeded to the buyer. The broker must notify buyer and seller within 30 days, in writing, of the:
selling price of the property.
An agency relationship is created by all of the following except:
specific performance.
A loan originator is an individual who:
takes a residential mortgage loan application.
Ms. Seller had been showing homes to a young, newly married couple for quite some time and finally found one which they wanted to buy. But even with the best loan available, they did not have enough cash for the down payment. They felt that they could raise the additional money they needed by borrowing against their automobile and other sundry personal property. Under these circumstances, the broker should:
tell them it is their decision to make, but point out the pitfalls of this kind of financing.
Assume all necessary instruments, properly executed and delivered, concerning a sale of real property were placed into escrow. It later develops that the escrow instructions signed by the buyer and the seller contained terms in conflict with the original deposit receipt:
the escrow instructions would prevail.
When running a real estate office, the phrase "company dollar" means:
the income of an office after all commissions are paid to the salespeople.
All of the following statements concerning an option are correct except:
the optionee has the legal right to enter and use the property right after the option has been entered into.
A broker acting as agent for a principal has as much authority as:
the principal actually or ostensibly confers upon him.
Agency is referred to as the relationship between the agent and his principal. All of the following statements are correct about agency, except that:
the principal must pay money to the agent to create an agency relationship.
In regards to a listing contract, a fiduciary relationship exists between the broker and:
the seller.
An agent has only a duty of honesty and fairness in dealing with:
third parties.
The relationship of loyalty and trust that exists between a principal and agent most nearly resembles the relationship between:
trustee and beneficiary.
The fiduciary relationship between an agent and the principal is comparable to the relationship of a:
trustee to beneficiary.
California Real Estate Law imposes upon a real estate agent the highest obligation of undivided interest and loyalty to his principal. This relationship is comparable to that of a:
trustee to the beneficiary.
All of the following are parties to a deed of trust, except:
vendee
