Oklahoma Provisional Sales Associate Test- Part 4

The universal appraisal report

URAR

value is enhanced by a home's proximity to a beautifully shaded park

amenities

Market price is the

amount, in terms of money, paid for the property.

Under the Oklahoma Broker Relationships Act, a broker shall not be

an agent, a sub-agent, or a dual agent.

A designated broker authorized an agent to singularly represent a seller, to the exclusion of everyone else in the office. This agent is called

an appointed agent.

In appraising a single purpose building, such as a church, the most reliable approach to an indication of its value would generally be the

cost approach and market data approach.

In the cost approach this is added back after subtracting depreciation from replacement cost new

Land

When figuring square footage of a house for appraisal purposes, use

outside measurements.

A cracked foundation wall

physical deterioration

The theory that greater utilization or efficiency of contiguous property increases value

plottage

A home is listed for $100,000 and sells for $90,000. The broker's commission is 7% of the selling price. The commission is

$6,300

Which of the following items would not be relevant in the appraisal of an older property? 1. The original cost 2. Current reproduction cost 3. An estimate of accrued depreciation 4. Recent selling prices of comparable properties in the neighborhood

1. The original cost

What statements correctly describe a fiduciary?

1. A fiduciary owes loyalty to the principal 2. A fiduciary must conform to the principal's legal instruction 3. A fiduciary is an agent

All of the following are correct statements concerning depreciation:

1. A loss of value from any cause 2. the subject of wear and tear on investment property or property used in a trade of business. 3. Includes all of the influences that reduce the value of a property below its replacement cost new.

What are some requirements of real estate brokers?

1. All offers must be presented by the broker to the principal 2. Brokers may not place blind ads 3. A fixed place of business must be maintained 4. The broker's commission usually is specified in the listing agreement

Multiple listing services are beneficial because they

1. Combine the best features of an open listing and exclusive listing 2. Expose properties to the prospects of many participating brokers 3. Serves as a clearinghouse for salable property.

What are some statements concerning a real estate salesperson?

1. The salesperson is responsible to the broker under whom he/she is licensed. 2. All of the salesperson's activities must be carried out in the name of his/her principal broker. 3. The salesperson may work under the broker as an independent contractor. 4. A salesperson is compensated on the basis of an agreement between himself/herself and the broker.

What would terminate a brokerage relationship by operation of law?

A change in law making the current use illegal. Bankruptcy of either the broker or the principal. Insanity of either the broker or the principal.

An appraiser who is using the comparison method to appraise a single-family residence would never use the selling price of what situation?

A similar home that was sold by owners who were forced to sell at any price because of financial difficulties.

A real estate broker is usually what kind of agent?

A special agent

Sales not influenced by unusual circumstances used to determine the market value of a property

Arm's length or most

Sally and her friend Bill met one evening at a cocktail party. When Sally told Bill that she had been appointed to a new job in another city, he asked whether she was going to sell her home. She said she was. Two weeks later Bill presented Sally with a buyer, but she denied having hired Bill as a licensee. To collect a commission,

Bill will have to produce more convincing evidence that he was hired by Sally.

When Ellie hires Bob to sell her home, their listing contract gives Bob and exclusive-right-to-sell. Two weeks later, Ellie sells the house to a friend. Although Ellie has sold the house,

Bob has earned a commission.

Reporting tool to help agents determine a price range for a property

CMA

The process when net income is divided by an investor's desired percent of return.

Capitalization

An appraiser was hired to prepare a feasibility study for a 24-unit apartment building in which the owner was considering putting in a swimming pool. What basic principle of appraising would be used?

Contribution

What situations would permit an owner to cancel a brokerage relationship?

Death of the broker or destruction of the property. Lack of diligence by the broker in procuring a buyer. Refusal of the broker to reduce the listing price.

Sold price divided by annual income

GIM

Sold price divided by monthly rents

GRM

A doctor listed his home with a broker under an exclusive-right-sell agreement. The listing salesperson and her broker signed the listing contract. Which of the following statements does not correctly describe the relationship among the parties.

If the salesperson dies, the listing contract is terminated.

What is true concerning multiple listing services?

Most are a function of the local board of REALTORS.

The brokerage relationship will last until its purpose has been fulfilled or it is otherwise terminated. What would terminate the brokerage?

Mutual consent, death of the principal or revocation by the broker

A man owned a single-family house and had his unlicensed son-in-law do the electrical work in preparing his home for sale. The man did not disclose this to the broker at the time of executing the listing. After completion of the sale, the new owner suffered a financial loss because of the faulty electrical wiring done by the owner's son-in-law. Has the broker done anything wrong?

No, the broker is innocent of any wrongful act.

A broker employs several salespeople at her office. Early one day one member of the sales staff submits a written offer with an earnest money deposit on a house listed with the broker. Later the same day another salesperson submits a higher written offer on the same property, also including an earnest money deposit. The broker, in accordance with the policy of her office, does not submit a second offer unless the first has been presented and rejected by the seller. In this case, the seller accepts the first offer, so the seller is not informed of the second offer. In this situation the broker's action are

Not permissible, because the broker must submit all offers to the seller

A couple wants to sell their house. They want a broker to show the property, but they would like to be able to sell the house themselves without the obligation of paying a broker commission. What form of listing would allow them to use the services of several brokers and not pay a commission should they sell the house themselves?

Open listing.

A salesperson is working under a broker. The salesperson may work under the broker as an independent contractor. The salesperson may NOT

Place an ad without identifying the broker. Receive a commission directly from the seller. Receive a commission directly from another broker.

Combining all three appraisal approaches to determine an indicated value.

Reconciling

Joe has his "dream house" constructed for $250,000 in an area where most new constructed homes are not as well equipped and typically sell for about $180,000. the value of Joe's house is likely to be affected by the principle of

Regression.

Al agrees to buy Bill's real estate for $123,000. Al signs a sales contract and deposits $12,300 ernest money with Bill's broker Carl. Bill is unable to show good title and Al demands the return of the earnest money from carl, as provided in the contract. What should Carl do?

Return to entire amount of earnest money to Al

What principle appraiser uses to determine maximum value by comparing equally desirable substitutes.

Substitution

What is the listing broker's legal responsibility to a prospective purchaser?

The broker must not use fraud or deceit

Which of the following is a violation of the broker's fiduciary relationship with a seller?

The broker tells a prospective buyer the lowest price the seller will accept.

A couple enters into an open listing agreement with Snaildust Realty. Later the sellers find a buyer themselves and notify the broker. What would be true of the listing agreement?

The listing agreement would be terminated.

Smoky owns a small restaurant she is anxious to sell. Shortly after she gives Broker Leg an exclusive-right-to-sell listing, the restaurant is destroyed by fire. What happens to the listing?

The listing is terminated automatically by operation of law.

A salesperson working for a broker has just written an offer to purchase on her broker's listing in which the buyer has written a check for earnest money and stated that the broker hold the funds. Which of the following statements describes how the earnest money payment should be handled?

The salesperson should give the earnest money check to her broker for deposit in the broker's trust account.

You are a broker who has listed a home for a neighbor. What term describes your relationship with the seller?

The seller is your client

What should have not influence on an appraisal compensation?

The value estimated in the appraisal

The responsibilities of a broker in an agency relationship include

accountability for funds received.

After the transaction is closed, what remains an obligation of the broker?

accounting for any money or property relating to the transaction.

Physical deterioration results from

action of the elements and normal wear and tear.

When a broker lists a property, the broker may

advertise the seller's broker.

In setting a price on a house, the prudent broker will

advise the seller to set a price close to the market value.

The act of combining contiguous property to increase the value of the combined property.

assemblage

Real estate listings, for the protection of all parties, should

be prepared on proper listing forms and always be written.

The rate of return that an investor expects to earn on invested money is the

capitalization rate.

The principal value that reflects the fact that the present use of a property may be different from its use ten years from now it the principle of

change.

A name for sold homes used in a CMA

comparables

Information concerning motivational factors, price and financing in relation to buyers and sellers, under the Broker Relationships Act is considered

confidential.

A neighborhood which maintains high property values because of its similar but not identical architectural styles is benefiting from the principle of

conformity.

To create agency requires two thing: delegated authority and

consent to act.

Dollar value of any housing component measured probable sales price by its worth using "paired sales" in an open market

contribution

The elements necessary for property to possess value include

demand, utility, and transferability.

Results from building in excess of the value of the neighborhood.

diminishing returns

You have been diligently working on a listing for many months. Before it expires, you find an excellent prospect who makes an offer for the listed price. Shortly after obtaining the offeror's signature, you discover that the owner was declared mentally incompetent a week before. You must now

do nothing. Your authority ended a week ago.

You are appraising a 20-year-old apartment house. When this building was constructed, the neighborhood was exclusively residential. Today, scattered industrial uses are found in the area. This is an example of

economic obsolescence.

A licensed real estate broker who engages the services of a licensed salesperson on the basis that the broker can direct what the salesperson can do but not how it is done has

engaged an independent contractor.

Knowingly taking listing that is grossly overpriced without proper counsel to the seller could be

evidence of a violation of the Broker Relationships Act.

A broker presents a seller with a written offer to purchase. The broker is responsible for

explaining the advantages and disadvantages of the offer to the seller.

Diminished value due to airplane landing routes over a neighborhood.

external obsolescence

The usual listing contract authorizes a broker to

find a purchaser and accept a deposit with an offer to purchase.

A 3-bedroom two-story home with only 1 bath

functional obsolescence

When changing tastes and standards cause an existing house to lose value

functional obsolescence.

A special agent is best described as someone who

has authority to represent a principal in a specific transaction.

In Oklahoma, the Common Law of Agency

has been abrogated by the Oklahoma Brokerage Relationships Act.

A broker recently has listed a home under an exclusive-right-to-sell listing contract. The broker generally will earn his commission when

he finds a buyer ready, willing, and able to buy on the terms of the listing.

A salesperson sells a property listed by her broker. The salesperson may accept her share of the commission from

her broker.

In the event a broker receives a fee or compensation from any party to the transaction based on a selling price or lease cost in a transaction

it does not constitute breach of duty.

The Broker Relationships Act provided that, when the transaction is terminated, the broker must

keep confidential information confidential.

The principle factors for which adjustment must be made in using the market data approach include

location and physical features date of sale terms and conditions of sale

The value which represents the price that a property will bring if it is sold after being offered for a reasonable period of time, and the sale is completed between knowledgeable buyers and sellers, neither acting under duress, is the

market value.

When the potential buyer asks questions about why the seller is selling the property, the broker

may explain the request involves confidential information which he/she has not been fiene permission to disclose.

A broker is listing her neighbor's home. The commission should be determined by

negotiation with her neighbor

A seller lists property for sale with a broker. In the listing contract, which is legal in Oklahoma, it is stipulated that the seller will receive $162,000 being the broker's commission. This type of listing would be a

net listing, considered dangerous for ethical reasons.

Under authority of a signed exclusive brokerage listing, Broker Hart diligently advertised to sell a home. Prior to the expiration date of the listing, the owners sold their home through their own efforts to friends and refused to pay Hart any commission whatsoever. The owners are legally obligated to pay Broker Hart

no commission.

Phenomenon that happens when buying the least expensive home in the most expensive neighborhood

progression

A broker has received several offers for a property he has listed. The broker mst present each offer to the seller

promptly on receipt.

If you were to calculate the cost of rebuilding a structure using exactly the same material used in the original construction, you would determine the cost of

replacement.

Essential to creating value

scarcity

The listing broker owes fiduciary duty to the

seller.

The statement that no prudent person would pay more for a parcel of real property than the price of a reasonably close alternative which is available without undue delay, refers to the principle of

substitution.

In the comparison approach to appraisal, after adjustments are made for each comparable, the result is

the adjusted market value.

An owner listed her home for $98,000, and the listing broker told the prospective buyer to submit a low offer because the seller was desperate. The buyer offered $96,000 and the seller accepted. In this situation

the broker violated the agency relationship.

The first thing appraisers should know in undertaking an appraisal assignment is

the purpose of the appraisal.

Highest and best use is

the reasonable, possible, and probably use of the property that will yield the highest return of investment.

The broker has earned a commission on the sale of her listing by another broker. The listing broker may pay part of her commission to

the selling broker.

Brokers may offer properties for sale at prices that

their principals have agreed upon.

You are a broker acting as a facilitator in the sale of a house without being an agent of either party. You are a

transactional broker

A broker has just received an earnest money payment on an offer to purchase. The broker must place the earnest money in his

trust account.

The power of a good or service to command other goods or services in exchange is

value.

If a firm provides brokerage services to both parties in a transaction

written notice to both parties shall be made in writing prior to the signing of a contract.