FLSAPREP5Long
05.29 Broker Brown and broker Smith each hold exclusive right-to-sell listings on adjacent subdivisions both owned by Gulf Coast Properties. Since the brokers operate offices next door to each other, they hired sales associate Jones to sell only the subdivision property. The sales associate is to work for both brokers, spending an equal amount of time in each broker's office. Each broker will pay the sales associate $150 per week. Which is correct? The sales associate: a- may not work in this manner. b- should be licensed under both brokers. c- must be licensed under Gulf Coast Properties. d- should have multiple licenses
a A sales associate may have, and be paid by, only one employer at a time in the real estate business
05.71 What type of lien can be created when the seller does not receive full payment of the purchase price upon the sale of real property? a- vendor's b- vendee's c- general d- mechanic's
a A vendor's (seller's) lien is used when the seller does not receive full payment at settlement. A vendor's lien is a specific lien. The vendee is the buyer.
05.33 B wanted a motel site. Sales associate A showed B a good location zoned for a motel. A then went on vacation. Upon A's return, B purchased the site with A's assistance. A did not know that while she was away on vacation, the zoning had been changed, and B was subsequently denied a building permit for the motel. Which applies? a- A is guilty of culpable negligence and subject to discipline. b- A is guilty of nothing as there was no intent. c- A is guilty of negligence and may be disciplined. d- A and A's broker are both guilty of fraud and may be disciplined.
a A's lack of attention to the transaction caused injury to B. Culpable negligence is a proper charge, when damage has occured
05.64 Every Christmas Day, the owners of Rockefeller Center close access by setting up barriers on the private sidewalks surrounding the building. This is done to prevent a claim by the city of New York based on: a- easement by prescription. b- easement by necessity. c- encroachment. d- easement by grant.
a After an uninterrupted period of time (determined by state statute) and open and continued use, the city of NY could claim that the sidewalk belongs to the city via easement by prescription. An easement by necessity would be hard to establish in the middle of downtown, with many sidewalks and avenues. An encroachment would be an unauthorized use of property. No contract exists between the city and the center, so no grant
05.69 The degree, nature, and extent of interest in real estate is called a/an: a- estate. b- deed. c- conveyance. d- encroachment
a An estate is an interest in property
05.70 When a property undergoes foreclosure, the mortgagor can redeem his or her interest in the property by: a- exercising his or her equity of redemption. b- using his or her right of first refusal. c- requesting a writ of mandamus. d- filing a suit to quiet title.
a By paying all the moneys due prior to the sale, including cost, the mortgagor can prevent the foreclosure sale.
05.37 Two brokers who file with the Florida Department of State and receive a charter have formed which type of business relationship? a- a corporation b- a limited partnership c- a general partnership d- a business trust
a Corporations are the only businesses that receive charters
05.09 Discount points charged by lending institutions on FHA and VA mortgage loans: a- increase the lender's yield. b- are typically paid by the seller. c- are regulated by RESPA. d- are always paid by the seller.
a Discount points increase the lender's yield by appx. 1/8% per point.
05.19 The DBPR has a written and signed complaint that is withdrawn. The DBPR must: a- continue with the investigation. b- tell licensee that the complaint has been withdrawn and investigation must be dropped. c- continue the investigation file the results but may NOT impose penalty. d- impose a summary suspension.
a Even if a complaint is withdrawn, the DBPR must continue the disciplinary action.
05.89 A licensee violates a duty imposed by a listing contract. Which applies? a- His or her license may be revoked. b- Concealment has occurred. c- The FREC will take no action without good cause. d- The FREC will fine the licensee $5,000.
a In the case of fraud, misrepresentation, and dishonest dealing, the usual action of the commission is to impose the penalty of revocation.
05.16 A salaried manager of a condominium complex may negotiate a: a- 6-month lease for an owner who owns one unit in the complex. b- 2-year lease for an owner who owns three units in the complex. c- lease for more than one year when the owner owns 2 units in the complex. d- lease for more than one year when the owner owns one unit in the complex.
a Leasing is permissible if the manager is salaried and the lease is for a term of one year or less
05.86 The Department receives an unsigned complaint stating a sales associate has been representing himself to customers as a licensed broker. Which is correct? a- If the allegation is true, then the sales associate is subject to disciplinary action. b- No action may be taken based on an unsigned complaint. c- The sales associate will be revoked. d- If no damage to the public has occurred, no action will be taken.
a The DBPR will take unsigned and anonymous complains if legally sufficient
05.11 The Sunshine Corporation acquires 60 acres of ranch land and subsequently subdivides it into 5-acre ranchettes and offers them for sale. The corporations' officers and directors agree to pay themselves regular salaries and, in addition, 15% of the sales price of any ranchette that said officer or director sells. Which is correct? a- All officers and directors of the corporation must be licensed as brokers with the DBPR for this agreement to be legal. b- Because the corporation can sell its own land, this agreement is legal. c- The officers and directors are engaged in a syndicate. d- Civil action may be brought and enforced by the officers and directors if anyone attempts to interfere with their agreement.
a The officers and directors must be licensed because they are to receive commisions for their services of real estate
05.51 The right of survivorship can be described as the right of: a- co-owners to automatically receive the interest of the deceased co-owner. b- heirs to receive the co-owner's share of real estate as provided in the will. c- 2 or more people to hold title to a property at the same time. d- a spouse to automatically receive ownership upon the death of the other spouse.
a The right of survivorship refers to surviving co-owners automatically receiving the interest of the deceased co-owner upon his/her death. The right of heirs to receive the co-owners share of real estate as provided in the last will and testament is the right of inheritance. Tenancy in common is a term for an estate characterized by 2 or more people holding title to a property at the same time. Estate by the entireties answer is too narrow.
05.83 Developers offering 25 or more lots across state lines must provide a property report to the prospective buyer and a statement of record to HUD according to: a- the Interstate Land Sales Full Disclosure Act. b- local building codes. c- the National Environmental Policy Act. d- the Truth-in-Lending Act.
a The sale of lots may also be regulated on a local level by city code, but it is the Federal Interstate Land Sales Full Disclosure Act, that requires that specific documentation. (Wiki: 100 and more units, not 25!) The National Environmental Policy Act requires filing environmental impact statements. The Truth-in-Lending Act deals with matters related to finance
05.46 Select the true statement concerning a real estate investment trust (REIT). An REIT: a- cannot have a broker's license. b- can have a broker's license if it is an equity trust. c- can have a broker's license if it is a mortgage trust. d- can have a broker's license if it is going to sell property.
a Trusts cannot register as a real estate broker
05.04 VA discount points are paid by: a- negotiation between the buyer, seller, and lender. b- the seller. c- the buyer. d- the lender.
a VA discount points are paid by negotiation between buyer, seller and lender. The points can be paid by any or all of them
05.63 Betty owns a restaurant and has pledged both her real estate and all her equipment as collateral for a loan. What type of mortgage does Betty have? a- package mortgage b- blanket mortgage c- chattel mortgage d- reverse annuity mortgage
a package mortgage
05.34 An interest only loan is referred to as a/an: a- term loan. b- amortized loan. c- partially amortized loan. d- purchase money mortgage.
a term loan.
05.67 When an owner is landlocked and has no access to roads, the landowner may go to court and ask for an: a- easement by prescription. b- easement by necessity. c- encroachment. d- easement by grant.
b Easement by necessity can be granted by the courts when a property owner has no access to roads and is landlocked. Easement by prescription is use of the land of another for a predescribed time. Encroachment is unauthorized use of anothers property. Easement by grant is created by written agreements of the landowners.
05.100 A purchaser attempts to buy a house for $190,000. She can secure 80% financing on a first mortgage. Prior to closing, she convinces the seller to hold 46% of the balance on a second mortgage. What is the amount of the down payment? a- $38,000 b- $20,520 c- $17,480 d- $12,500
b $190,000 x 0.20 = $38,000 $38,000 x 0,46 = $17,480 $38,000 - $17,480 = $20,520
05.93 A property's sale price is $23,000 with a 6% commission. If the listing broker receives 10% of the total commission, what will the selling sales associate and broker receive? a- $621 b- $1,242 c- $1,380 d- $1,520
b $23,000 x 0.06 = $1,380 $1,380 x 0.10 = $138 $1,380-$138=$1,242
05.92 Developer Dave transferred all the streets, parks, and the school he built in his subdivision to the government. This is an example of: a- escheat. b- dedication. c- intestate succession. d- eminent domain.
b - Dedication involves giving land to the government for streets, parks etc - Eschaet is the reversion of property to the state, on the owner's dying without legal heirs. - Intestate Succession occurs when a person dies without a valid will, his or her estate passes to heirs or certain classes of family members by intestate succession, - Eminent domain is a right of a government to take private property for public use
05.26 A rule of thumb is that one discount point raises the effective yield of a typical home loan by approximately: a- 1/16 of 1%. b- 1/8 of 1%. c- 1/4 of 1%. d- 1/2 of 1%.
b 1/8 of 1%.
05.49 A limited partnership is formed by: a- filing a certificate with the FREC. b- filing a certificate with the Florida Department of State. c- obtaining signatures of all partners. d- obtaining a charter from the Florida Department of State.
b A limited partnership is created by filing the required documentation to the Florida Department of State. This question makes no reference to performing a real estate brokerage service.
05.66 What clause is included in a mortgage that will allow a lien recorded subsequent to another lien to have a position superior to the one recorded earlier? a- release clause b- subordination clause c- cognovit clause d- superior clause
b A release clause allows for the freeing of part of a property from claim by the creditor after a proportional amount of the mortgage has been paid. A cognovit clause is considered to be a confession of judgment. It authorizes the lender's attorney to obtain a judgment lien against the debtor's real property. Without this clause, the lender must sue on the basis of the note and prove it to be in default. "superior clause" no hits in Google !!
05.23 Buyer Smith gave a postdated check to sales associate Brown, which seller Jones accepted. Buyer Smith told the sales associate to hold the check for 2 weeks until the buyer could fly to New York and transfer funds from her savings account to cover the amount of the check. On the date the sales associate received the check the broker was out of town, but he returned the following day. Following the buyer's instructions, the sales associate deposited the postdated check into the broker's escrow account 2 weeks later. Which statement is correct? The sales associate: a- acted properly as the seller had accepted the postdated check. b- should have turned the postdated check over to the broker the next business day. c- acted improperly as a postdated check may never be accepted as a deposit. d- acted properly as she was following the principal's instructions.
b A sales associate is required by law to deliver a deposit immediately to the broker. (By rule to deliver the deposit to the broker by the close of business one business day following receipt)
05.85 When the landlord dies, the estate for years: a- is terminated. b- is binding on the heirs. c- reverts to a tenancy from month to month. d- is considered void.
b An estate for years is not terminated by the death of either party. The heirs must continue to perform under the terms of the lease
05.10 A developer secured a mortgage loan to develop a land project. When he sold one of the lots, a partial release was obtained for the lot the buyer was purchasing. The developer's mortgage is known as a/an: a- contract for deed. b- blanket mortgage. c- package mortgage. d- open-end mortgage
b Blanket mortgages cover 2 or more lots and have release clauses to allow a lot to be released from the general encumbrance of the blanket. (a) Contracts for deed are used in seller financing. (b)Package mortgages have chattel or personal property included. (c)Open end mortgages allow the borrower to draw from the well again - that is, to re- borrow principal.
05.31 Broker Bob decides to use the trade name Big Bob's Realty for his real estate business. Bob must: a- run an ad in the newspaper declaring same at least 4 times. b- register the trade name with the FREC so it can be entered into the Commission's records. c- file a fictitious name act with the Florida Department of State. d- secure a charter with the Division of Corporations.
b Brokerage firms must register their name with the FREC
05.50 A Sales Associate employed by Broker A sells a property listed by a sales associate employed by Broker B. At closing, the commission due to Broker A's sales associate should be made payable to: a- Broker A's sales associate. b- Broker A. c- Broker B. d- Broker B's sales associate.
b Commission checks are made payable to the sales associate's employer. (was wrongly "c" in the test)
05.81 The difference between police power and eminent domain can best be determined by whether: a- the action was by a governmental agency. b- any compensation was paid to an affected owner. c- the owner's use was affected. d- the improvements are to be destroyed.
b Compensation is the critical factor in determining the difference between police power and eminent domain. In both, actions are taken by a government agency and the owner's use is affected. In a police power action, no compensation is paid if affected property owners suffer a loss. In eminent domain, the owner is compensated for any loss in value. Although eminent domain actions may result in the destruction of property, destruction may not result in all circumstances.
05.76 The primary purpose of a deed is to: a- give notice of title. b- transfer title rights. c- give constructive notice. d- establish the chain of title.
b Giving notice must be done by possession or by recording. The deed accomplishes neither. A deed is simply a conveyance. It does not give notice of title, which must be accomplished by possession or by recording. One must take the deed and record it, in order to establish ownership via constructive notice.
05.53 Broker Ben is forming a real estate brokerage corporation with his secretary Clark and his 2 sons, Tom and John. Ben will be president, Clark the vice president, Tom the secretary, and John the treasurer. Two actively licensed sales associates have been invited to join the firm as directors of the corporation. Which statement is incorrect? a- The corporation must register with the DBPR. b- Sales associates are allowed to be directors of a brokerage corporation. c- Tom, John, and Clark must be actively licensed brokers to perform services of real estate. d- Sales associates are not allowed to be officers of a brokerage corporation.
b Incorrect: Sales associates are allowed to be directors of a brokerage corporation.
05.74 Mr. Reynolds inspects a property and notes a pile of fencing that the seller says was purchased for the purpose of fencing in the yard, which the seller has not gotten around to doing. When Mr. Reynolds buys the property and takes possession, the fencing has not been installed and has been removed from the property. Mr. Reynolds consults with his attorney and is advised that: a- because he saw the fencing at the time of inspection, it is part of the sale and should have remained. b- because the fencing was not installed, it is personal property and not included in the sale. c- he ought to try to negotiate with the seller for its return. d- according to real estate law, this is a fixture and Mr. Reynolds has a right to the fencing that would be upheld by a court.
b Items not yet installed are personal property. If otherwise, it should have been noted in the sales contract
05.72 The law which requires federally regulated lenders to disclose to borrowers all settlement charges involved in the transaction is the: a- Consumer Credit Protection Act. b- Real Estate Settlement Procedures Act. c- Truth in Lending Act. d- Loan Charges Disclosure Act.
b RESPA requires the borrower be given a good-faith estimate of closing costs within 3 business days of the loan application and a booklet explaining closing costs
05.39 Real property can be defined as: a- the rights of use and possession. b- a bundle of rights. c- the rights of disposition and exclusion. d- land only.
b Real property is a bundle of rights which include disposition, use, possession and exclusion. Answers a and c are incomplete.
05.54 A buyer makes an offer without a deposit, but the offer is accepted by the seller. What interest has been created in favor of the buyer? a- ostensible title b- equitable title c- legal title d- no title
b Seems to be correct as a contract gets equitable title
05.20 A broker, representing herself in the transaction, sells property that she owns to buyer Smith. Smith may rely on representations concerning: a- future forecasts. b- all information. c- concealed construction defects. d- patent defects.
b Sellers are required to disclose any hidden defects in a property they are selling. In addition, because the seller is a licensee, the buyer can rely on any information disclosed by the licensee or the licensee could be held liable. Latent defect: fault not readily be revealed by a reasonable inspection Patent defect: not hidden and should easily be discovered by a reasonable inspection
05.61 A minority couple asks to be only shown homes occupied by minorities. In this case the license should: a- comply with their request. b- explain that compliance with their request would violate fair housing laws. c- ignore their request. d- file a complaint with HUD
b Showing homes based on a protected class is a violation of fair housing laws.
05.06 A minority customer enters broker A's office and requests to be shown houses in minority neighborhoods. The broker advises the customer that she will show the customer houses without regard to the racial characteristics of the neighborhoods. The customer is shown houses in minority neighborhoods and non-minority neighborhoods. The customer becomes interested in 2 houses, both located in predominantly minority neighborhoods. If the broker had followed the customer's initial instructions, which would be correct? Broker A would: a- have violated federal laws but not Florida real estate license law. b- have violated the Civil Rights Act and Florida law and her license could be suspended or revoked. c- not have violated any laws because brokers must follow all instructions of a customer. d- have violated ADA requirements.
b The Civil Rights Act and Florida law dictate that racial considerations cannot be used when showing real estate
05.17 The Federal Housing Administration: a- makes loans to qualified applicants. b- sponsors the insurance programs that protect lenders against financial loss. c- guarantees loans to qualified applicants. d- offers interest-free loans to qualified applicants.
b The FHA does not lend money or guarantee loans. It runs the mortgage insurance fund that backs FHA loans.
05.58 Which statement is true regarding an option on real property? a- The option is unilateral and binds only the optionee. b- The option is unilateral and binds only the optionor. c- The option is bilateral and binds both optionee and optionor. d- The option is only bilateral if there is no consideration paid for the option.
b The option is unilateral and binds only the optionor.
05.52 Joanne and Don owned property jointly as husband and wife. Upon the decree of their divorce, their ownership becomes automatically abolished and reverts to: a- joint tenancy. b- tenancy in common. c- estate by the entireties. d- estate for years.
b Upon a divorce, an estate by the entireties becomes a tenancy in common, where the right of survivorship is eliminated. An estate by the entireties exists only during the marriage. The couple will not become joint tenants because that form of ownership still permits right of survivorship. An estate for years is a relationship between landlords and tenants.
05.45 The initial step a taxpayer takes to protest the assessed value of his/her property is to: a- hire a real estate attorney. b- contact the county property appraiser. c- file for a restraining order. d- contact the Value Adjustment Board.
b contact the county property appraiser.
05.13 A license issued by the Department of Business and Professional Regulation is: a- proof of residency. b- prima facie evidence of licensure. c- evidence of competency. d- licensure of the licensee.
b prima facie evidence of licensure.
05.94 If you have monthly income of $1,833.33 and you can afford a home 2.5 times your annual income, what is the price of the home you can afford? a- $45,833 b- $50,666 c- $55,000 d- $57,000
c $1,833.33 x 12 = $22,000 (rounded) x 2.5 = $55,000
05.14 Mr. Johnson obtains a court judgment against Broker Wilson for $75,000. Broker Wilson has assets in the amount of $30,000. How much can Mr. Johnson make a claim for against the Florida Recovery Fund? a- $25,000 b- $35,000 c- $45,000 d- $50,000
c $45,000
05.99 A home with a sales price of $60,000 is 80% financed with a conventional loan. The total origination charge amounts to 2 points. What is the total amount of discount owed? a- $2,400 b- $1,200 c- $960 d- $600
c $60,000 x 0.80 = $48,000 $48,000 x 0.02 = $960
05.97 A house is purchased for $78,000. The lending institution is insisting on an $11,700 down payment. What is the loan-to-value ratio? a- 75% b- 80% c- 85% d- 95%
c $78,000 - $11,700 = $66,300 $66,300 / $78,000 = 0.85 or 85%
05.21 How long after being served a final order of the commission does a licensee have to file a petition for review? a- 14 days b- 20 days c- 30 days d- 60 days
c 30 days
05.91 A 2-story home has 720 sq. ft. on each floor and a 20 ft. × 22 ft. garage. If today's construction cost is $24 per sq. foot for the living area and $15 per sq. foot for the garage, what would be the cost of reproduction? a- $23,880 b- $27,840 c- $41,160 d- $55,680
c 720sqft x 2 = 1,440 sqft x $24 = $34,560 20ft x 22ft = 440sqft x $15 = $6,600. $34,560 + $6,600 = $41,160
05.28 Broker Jim lists a property he sold 2 years ago. At the time of the original sale, an attorney judged the title to be marketable and free from any defects except the outstanding balance of a first mortgage. Broker Jim finds a purchaser for the property and is asked about the condition of the title. Broker Jim should: a- advise the buyer the title is marketable because he has prior knowledge of the property. b- advise the buyer the title is marketable if the buyer has knowledge of the first mortgage. c- advise the buyer to see an attorney regarding the quality of the title or purchase title insurance. d- read the buyer the original title opinion.
c A broker should make no statement concerning the condition of title; the buyer should be advised to seek the opinion of an attorney based on a current abstract of title, or obtain title insurance
05.82 A governmental power whereby title to property reverts to the state when heirs to the property cannot be found, is known as: a- condemnation. b- taxation. c- escheat. d- encroachment.
c A governmental power whereby title to property reverts to the state is known as escheat. Condemnation is a court action, that permits the government to take property under the power of eminent domain. Taxation is the right of the government to collect money from property owners, but title does not actually belong to the government. An encroachment is a trespass on property.
05.05 Broker Smith has an office in Orlando and a branch office on Jefferson Street in Tampa. He decides his branch office would do better if it were located in St. Petersburg. What should broker Smith do in regard to this transfer? a- require all sales associates to be registered at the Orlando office although they may still work in the St. Petersburg office b- request a transfer of the branch office c- must register the St. Petersburg office and pay the appropriate fees d- request an active branch office license for the St. Petersburg office and an inactive license for the Tampa office
c A new license is always required to open a branch office, unless a currently licensed branch office is closed and later reopened in the same location, during the same license period.
05.78 An active broker: a- is required to employ at least one sales associate. b- may not have an office in his home. c- must have an office in a building of stationary construction. d- may be registered under an owner employer.
c An active broker must maintain an office in a building of stationary construction
05.18 The pledging of property as security for payment of a loan is known as: a- disintermediation. b- equity. c- hypothecation. d- subordination.
c Hypothecation is pledging property without giving up ownership. (a)Disintermediation refers to taking money out of a bank (to invest in stocks for example). (b)Equity is a reference to the difference between what is owned and the property value. (d)Subordination is the act of lowering recording priority (taking a first mortgage and making it second)
05.90 If a Broker's license is suspended, the licenses of all sales associates and broker associates working for that broker would be: a- suspended. b- revoked. c- placed on involuntary inactive status. d- canceled
c If an employing broker's license is suspended, all licenses under the employing broker are placed in an involuntary inactive status.
05.44 The best way to determine if something is a fixture is to: a- go to a judge. b- review the intent of the parties by asking them. c- review the intent of the parties by looking at their contract. d- ask the listing broker.
c Listing agents should make a list of all items being sold with the property, but the best way is to look at the contract
05.77 A homeowner listed his house for sale for three months beginning March 1. A court issued a decree of bankruptcy against the homeowner on March 15. Broker Brown produced a purchaser who offered to meet all of the terms and conditions of the listing on April 1. Which is correct? Broker Brown: a- is entitled to a commission and may file a suit to collect. b- is entitled to a commission if there is any money to disburse. c- is entitled to nothing. d- must contact the bankruptcy court for payment.
c Listing contracts may be terminated by: - abandonment by the broker; - failure to act; - breach by one party, which gives the other party an election to terminate; - lapse of time specified in the listing contract; - performance by the broker, who earns his or her commission; - renunciation (Verzicht) by mutual agreement or by the broker; - revocation by the owner; - death, insanity, or bankruptcy of the owner or broker; - loss of property through foreclosure; - destruction of the property
05.79 A mortgage that contains real property and personal property or chattel is called a/an: a- blanket mortgage. b- contract for deed. c- package mortgage. d- open-end mortgage.
c Package mortgages have chattel or personal property included. Contracts for deed are used in seller-financed transactions. Blanket mortgages cover 2 or more lots and have release clauses to allow a lot to be released from the general encumbrance of the blanket. Open end mortgages allow the borrower to draw from the well again - that is, to re-borrow principal.
05.87 Sam was in lawful possession of Larry's property but now refuses to leave after his right to possession has been terminated. During eviction proceedings, Sam would be known as a tenant: a- for years. b- at will. c- at sufferance. d- in expectancy.
c Sam is a tenant at sufferance during eviction. - If Sam had permission, he would be known as tenant at will. - An estate for years may become an estate at sufferance if the tenant refuses to leave after expiration of the lease. - An estate in expectancy is one whose title has not yet been received by the party entitled to receive it, such as a remainder estate or reversion estate
05.47 Which does not refer to a form of joint ownership? a- estate by the entireties b- joint tenancy c- estate at sufferance d- tenancy in common
c Tenancy at sufferance is not a form of joint ownership, but occurs when tenants retain possession without the landlords permission. Estate by the Entireties is a joint, husband-and-wife ownership. Joint tenancy is ownership usually between family members who wish survivorship. Tenancy in common is a form of joint ownership, usually between business partners who desire no survivorship.
05.55 Discrimination based on national origin is prohibited by: a- The Real Estate Settlement and Procedures Act. b- The Civil Rights Act of 1866. c- The Civil Rights Act of 1968. d- The Americans with Disabilities Act.
c The Civil Rights Act of 1968 prohibits housing discrimination on the basis of race, color, religion, or national origin. 1964 ended segregation in public places and prohibits discrimination of those classes in public places and employment ! 1866 Act prohibits all forms of racial discrimination in real estate.
05.08 Savings associations are regulated by which federal agency? a- the FOMC b- the Fannie Mae c- the OTS d- the FRS
c The Office of Thrift Supervision (gibts nicht mehr) - OTS merged with the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve Board of Governors, and the Consumer Financial Protection Bureau (CFPB) as of 21 July 2011. The OTS - ceased to exist on 19 October 2011. - FOMC is the Federal Open Market Committee, the branch of the Federal Reserve Board that determines the direction of monetary policy - FRS is the Federal Reserve System (FRS), the central bank of the United States. - Fannie Mae and Freddie Mac provide a secondary market in home mortgages, purchasing mortgages from the lenders who originate them. Fannie Mae mostly buys mortgage loans from commercial banks, while Freddie Mac mostly buys them from smaller banks that are often called "thrift" banks.
05.12 Broker Bill has a listing on Bob's house for $50,000, all cash. Broker Bill finds a customer, George, who is a member of a racial minority. George makes an offer in writing to purchase the house for $50,000, all cash. Broker Bill presents the offer to Bob, who refuses it. Bill should: a- only advise Bob of the possible violation of federal law. b- only advise George of the possible violation of federal law. c- advise both Bob and George of the possible violation of federal law. d- advise FHA of the possible violation of federal law.
c The broker has a duty to inform both parties that turning down a full-price offer made by a minority may have been discriminatory
05.73 A seller listed a property that the broker knew was below market value. The broker had his wife buy the property in her maiden name and subsequently resold the property at a profit. The broker: a- has not violated real estate license law. b- could be charged with culpable negligence. c- has committed a fraud by taking an overage (secret profit). d- is guilty of alienation.
c The broker is guilty of making a secret profit culpable negligence is insufficient attention to duties and responsibilities by those who know, or should know, what is required of them or guilty of failing to use the care a reasonable person would exercise Alienation means the transfer of real property from one party to another. Alienation clauses provides full repayment if ownership changes.
05.56 Bob has a provision in his mortgage that relieves the mortgagor from personal liability in the event of a default. This is called the: a- alienation clause. b- escalation clause. c- exculpatory clause. d- subordination clause.
c The exculpatory clause is a nonrecourse clause in a a mortgage contract, that prevents lenders from obtaining a deficiency judgement against the borrower, when the proceeds from a foreclosure sale are insufficient to satisfy the unpaid balance on the mortgage loan.
05.57 Which best describes the state of the title in a contract for deed? a- The seller has title. b- The buyer has title. c- The seller has legal title, and the buyer has equitable title. d- The seller has equitable title, but the buyer has no title rights
c The legal title remains with the seller until the terms of the contract have been satisfied and the buyer has equitable title.
05.68 The city of Palmcrest places liens on the properties located in Sunny Shores subdivision for the installation of streetlights. These liens are known as: a- general liens. b- assessments. c- special assessments. d- materialmen's liens.
c The lien is special, not general; assessment refers to valuation for tax purposes; materialsmen's lien = mechanic's lien
05.75 Proof of the existence or lack of existence of an encroachment is evidenced by a: a- deed. b- map. c- survey. d- building permit.
c The most accurate method to determine the existence of an encroachment is by a survey of the boundary line
05.62 Which statement concerning title insurance is correct? a- An owner's policy is transferable. b- The owner's policy protects the seller. c- The premium is paid in full at the time of purchase. d- The Mortgagee policy protects the buyer
c The owners policy protects the buyer and is not transferable. The mortgagee is the lender in a mortgage, typically a bank. Lender or mortgagee title insurance protects the lender/investor as security for making mortgage money available to a buyer. It does not protect the buyer. Owner's title insurance protects the buyer, lasts as long as you, the policyholder - or your heirs - has an interest
05.22 The purpose of the secondary market is to: a- make loans. b- insure loans. c- buy and sell loan portfolios. d- make second mortgages.
c The purpose of the secondary market is to circulate money throughout our economy by buying and selling loan portfolios. Secondary lender neither make loans nor insure them
05.24 A sales associate gets a signed contract from a buyer and mails it to the seller. The seller agrees to the terms, and the escrow deposit is put safely in the broker's escrow account. The sales associate has a disagreement with the broker and quits. The broker refuses to pay a commission, because the sales associate was not in his employ when the contract was actually received and signed. The sales associate should: a- notify the state. b- sue the principal for her share of the commission. c- sue the broker. d- forget it, as she is not entitled to any share of the commission.
c The sales associate had performed prior to leaving the employ of the broker
05.25 A corporation sole: a- must have a broker. b- must have each officer be an active broker or registered with the DBPR. c- cannot broker real estate. d- must have all individuals licensed.
c cannot broker real estate.
05.60 Which would be exempt from the Civil Rights Act of 1968? a- an owner who is the occupant of the home when they are represented by a broker b- rental of rooms or units in an owner occupied dwelling of 4 units or less if discriminatory advertising is used c- lodging owned or operated by a private club for the noncommercial rental or occupancy by its own members d- sale, rental, or occupancy of dwellings owned and operated by religious organizations for non-commercial purposes to persons of the same religion if membership in that religion has restrictions based on race, color, sex, or national origin
c lodging owned or operated by a private club for the noncommercial rental or occupancy by its own members
05.36 A broker has listed a home in a neighborhood where the properties are predominately owned by minorities. A minority customer obtains the broker's phone number from the yard sign and calls to inquire about the home. The broker: a- is probably being tested by HUD. b- must realize that the customer is discriminating and refuse to deal with him or her. c- should handle the inquiry as they would any other. d- should have a minority agent handle the inquiry.
c should handle the inquiry as they would any other.
05.96 A seller wishes to deed his property but wishes to make no guarantee or warranty about the title. What would be the best deed for the seller to deliver to the buyer? a- general warranty b- warranty deed c- deed of trust d- quitclaim deed
d - General warranty deed guarantees the property is free and clear from any defects or encumbrances. .. - Special warranty deed is only liable for debts or other encumbrances to the title that they caused or that happened during their ownership of the property. - a quitclaim deed contains no title covenant and thus offers the grantee no warranty as to the status of the property title; the grantee is entitled only to whatever interest the grantor actually possesses at the time the transfer occurs. - deed of trust or trust deed is a 3 party deed, wherein legal title is transferred to a trustee, which holds it as security for a loan (debt) between a borrower and lender. The equitable title remains with the borrower.
05.38 Broker Sam lists Gary's property for sale. Buyer Wanda submits an offer together with an out-of-state personal check in the amount of $1,000, which broker Sam immediately deposits in his escrow account. Broker Sam submits the offer to Gary, and Gary accepts. The contract states that the deposit was in the form of a personal check. Buyer Wanda's check fails to clear the bank. Which applies? Broker Sam: a- is guilty of a breach of trust as he did not inform the seller that the check was an out-of-state check. b- is guilty of culpable negligence because he did not insist on a certified or cashier's check. c- should have verified that funds were available since the check was from out of state. d- is guilty of nothing as he deposited the check immediately.
d A broker is not responsible for verifying availability of funds; if the check was properly deposited, the broker is not responsible should the check fail to clear the depositor's account.
05.15 Sales Associate Peggy ran an ad that only included her name and the address and phone number of her company. What would be true about such an advertisement? a- It is legal if her broker approves the ad. b- It would be a third degree felony. c- The FREC would fine and imprison Peggy. d- This would be a blind advertisement
d Advertisements must include the name of the brokerage firm
05.59 Which is not a type of encumbrance? a- mortgage lien. b- mechanic's lien. c- special assessment. d- escheat.
d Escheat is not a type of encumbrance. Eschaet occurs when a property owner dies intestate and the state government becomes the last heir to the property
05.01 A broker discovers that the license of one of her sales associates has expired. The broker stops the sales associate between a listing presentation and a sales presentation and has the sales associate complete a renewal form to be sent to the DBPR. Which statement applies? a- This creates no problem if the renewal is put into the mail that day. b- The broker has violated the license law. c- The sales associate has violated the license law. d- Both the broker and the sales associate have violated the law.
d Service of real estate has already occured
05.30 A customer who ultimately purchases from broker Smith was referred to broker Smith by an out-of-state friend. Which applies? Broker Smith: a- can share the commission with the out-of-state friend. b- can share the commission with the out-of-state friend if the friend does not come to Florida. c- cannot share the commission but may pay a referral fee. d- can share the commission if the friend is properly licensed in the state in which he resides and does not violate the Florida license law.
d Sharing commissions (referal fees) with a party properly licensed in another state is within the law; a Florida broker paying anything to an unlicensed party for a service of real estate would violate 475, F.S.
05.88 Should the actions of a licensee create an immediate serious danger to the public welfare, the DBPR is empowered by 120, F.S., to impose a/an: a- injunction. b- writ of mandamus. c- license revocation. d- summary suspension.
d Should the actions of a licensee create an immediate serious danger to the public welfare, Chapter 120, F.S. empowers the DBPR to impose a summary suspension, which is an emergency suspension.
05.48 The term tenancy in common refers to: a- common elements of a condominium. b- survivorship. c- the relationship of renters in an apartment complex. d- ownership
d Tenancy in common is ownership jointly held. While tenancy in common could refer to ownership in a condominium, the answer is to restrictive. There is no survivorship in a tenancy in common. Tenancy in common would not apply to individuals who are renting. (no ownership)
05.84 The law requiring lenders to furnish borrowers a good-faith estimate of closing costs is the: a- Fair Housing Act of 1866. b- Truth-In-Lending Act. c- Equal Credit Opportunity Act. d- Real Estate Settlement Procedures Act.
d The RESPA regulates disclosure of closing costs - The Fair Housing Act is Title VIII of the Civil Rights Act of 1968!! and prohibited discrimination concerning the sale, rental and financing of housing based on race, religion, national origin or sex. - The Truth in Lending Act (TILA) Regulation Z promotes the informed use of consumer credit by requiring disclosures about its terms and cost. Trigger terms: , amount or percentage of any downpayment; number of payments or period of repayment; amount of any payment; or amount of any finance charge. "No downpayment" is not a trigger. Requires: amount or percentage of the down payment; terms of repayment; and "annual percentage rate," - Equal Credit Opportunity Act: unlawful to discriminate on the basis of race, color, religion, national origin, sex, marital status, or age. income derives from a public assistance program; or applicant has exercised any right under the Consumer Credit Protection Act..
05.80 The 1988 amendment of The Fair Housing Act added what two classes for protection? a- age and handicap b- handicap and sex c- families and age d- families and handicap
d The amendment added familial status and the handicapped.
05.32 The broker's customer is the party: a- to whom the broker owes fiduciary duties. b- who the broker represents as an agent. c- who pays the broker's commission. d- to whom the broker owes no fiduciary duties.
d The customer is owed no fiduciary duties
05.02 A majority vote by the Florida Real Estate Commission is required for: a- dismissal of employees. b- termination of a suspension period. c- relocation of the FREC offices. d- final determination of an administrative complaint.
d The final order is a quasi-judical function that requires a quorum vote of the commission
05.65 When a mortgage is assigned, which does not apply? a- The mortgagee becomes the assignor. b- The assignee may want a letter of estoppel from the mortgagor. c- The promissory note is sold. d- The mortgagor becomes the assignee.
d The mortgagee, the lender in a mortgage, typically a bank, assigns the mortgage to another lender, who is the assignee.. The new lender might want to have an estoppel from the borrower. (should better be from the old lender !! MB) The promissory note, the promise to pay, is sold to the new lender. The mortgagor aka "borrower" stays the same and is neither assignor nor assignee
05.43 Gerald conveys a condominium to Felicia for life. Upon Felicia's death, the property goes to Jennifer. Jennifer has an estate in: a- reversion. b- recession. c- rescission. d- remainder.
d The person receiving the title upon death of the life tenant is called the remainder, and the estate is an estate in remainder. A reversion estate is created when the life estate goes back to the original grantor. The term recession could be used to describe an economic downturn. A rescission is a cancellation period.
05.27 A broker's principal is the: a- person paying the commission. b- seller. c- customer. d- person the broker represents as an agent.
d The person that pays the commission may or may not be the brokers principal. Chapter 475 defines the principal as the one the broker represents as a single agent.
05.35 The primary purpose of the Truth-in-Lending Act is to: a- establish usury rates. b- standardize interest rates on consumer loans. c- protect lenders against default. d- make loan cost information available to consumers.
d The primary purpose of this law is disclosure. That is, lenders must make certain information available to borrowers, so borrowers can shop for better rates and terms if they desire.
05.42 Broker Smith provided renter Jones with a rental information list on May 1 and was paid a fee of $200. The list was found to have several material inaccuracies. Renter Jones is: a- entitled to a refund of $50 if the request is made before May 15. b- not entitled to a refund as rental lists and information are not considered a service of real estate. c- entitled to a refund of $150 if the request is made before June 1. d- entitled to a refund of $200 if the request is made before June 1.
d The renter has 30 days to request a refund of 100% of any fee paid if the information is inaccurate.
05.03 Which is not a feature of VA loans? a- assumability b- 100% loan to value c- no prepayment penalty d- once-in-a-lifetime use
d Va entitlement may be fully restored or any remaining guarantee may be used. Therefore the VA program is not a once-in-a-lifetime loan program. VA loans are assumable by veterans who qualify. They are also no-money-down loands and have no prepayment penalty
05.41 A strip of land used to separate one land from another is called: a- easement. b- encroachment. c- median. d- buffer zone.
d buffer zone.
05.95 If a homeowner pays $1,800 each year in property taxes at a millage rate of 25 and has no homestead tax exemptions, what is the value of the property? a- $72,000 b- $97,000 c- $122,000 d- $151,000
a $1,800 / 0.025 = $72,000
05.98 A house sold 2 years ago for $40,000. If appreciation is 7% each year, how is the current value of the house calculated? a- add $5,796 b- add $5,600 c- subtract $2,800 d- subtract $5,600
a $40,000 x 0.07 = $2,800 $40,000 + $2,800 = $42,800 $42,800 x 0.07 = $2,996 $2,800 + $2,996 = $5,796
05.40 Fee simple estate and life estate are examples of what type of estate? a- freehold b- leasehold c- defeasible d- non-freehold
a A freehold estate is characterized by ownership for an undetermined length of time. A leasehold or nonfreehold estate is for a definite period of time. A defeasable estate is a type of fee simple ownership.
05.07 Broker Bob belongs to an appraisal group, and does not pay his renewal dues. Which would be true? a- He can no longer advertise he is with this group. b- It is a violation for a Broker to advertise any other services along with his real estate business. c- He can keep his advertisement as long as he pays his dues in the near future. d- This is not a matter for FREC.
a A licensee may not imply membership in any organization unless actually a member
