PRACTICE EXAM 5

A borrower has a $180,000 loan with an interest rate of 6%. What is the amount paid in interest each month? A900 Dollars ($) B980 Dollars ($) C4,650 Dollars ($) D10,800 Dollars ($)

A900 Dollars ($)

Which of the following does NOT have to be disclosed by a seller or seller's agent when selling a residential property? AA death that previously occurred on the property. BCracks in the foundation. CUncapped natural gas wells on the property. DTermite damage which have compromised the floor structure.

AA death that previously occurred on the property.

What will happen if the government increases the money supply in the economy, but the production of goods and services does not increase at the same pace? AA higher demand for housing BInflation CIncreased job growth DDeflation

AA higher demand for housing

Where does a buyer's earnest money deposit get placed prior to closing on the transaction? AA separate escrow account BThe listing broker's personal bank account CThe seller's attorney's personal bank account DAny bank account within the U.S.

AA separate escrow account

Which of the following loans is associated with monthly payments which fluctuate based on a standard index? AARM BFixed-rate mortgage CTerm loan DBlanket mortgage

AARM

Which of the following is a condensed history of title to a property? AAbstract of title BTitle insurance CDeed DChain of title

AAbstract of title

Which of the following is NOT permitted as a deduction on a homeowner's income tax return? AAppraisal fees BMortgage interest CProperty taxes for a primary residence DProperty taxes for a second home/vacation home

AAppraisal fees

Which of the following is considered an indirect cost? AArchitectural fees BCost of labor CCost of structural wood members DCost of concrete for the building's foundations

AArchitectural fees

The amount of heat required to raise the temperature of one pound of water by one degree Fahrenheit is known...? ABTU BR-value CAmperage DConduit

ABTU

Which of the following is illegal in New York State? ABalloon framing BPlatform framing CPost-and-beam framing DSteel framing

ABalloon framing

Which of the following loan types typically includes more than one property as collateral? ABlanket mortgage BARM CFixed-rate mortgage DTerm loan

ABlanket mortgage

Which of the following refers to the profit realized from the sale of real property? ACapital gain BCredit CCapital loss DDebit

ACapital gain

The actual act of taking private property for public use by the government is known as...? ACondemnation BForeclosure CGifting DEminent domain

ACondemnation

A broker represents a seller in a transaction. If the seller tells the broker they must sell the property quickly due to financial hardship, the broker cannot reveal this information to a prospective buyer. Otherwise, the broker will violate which of the following fiduciary duties? AConfidentiality BObedience CAccountability DFull disclosure

AConfidentiality

Which of the following is NOT one of the four units of concurrent ownership? ADedication BTime CTitle DPossession

ADedication

Which of the following is a payment made by a purchaser of real estate as evidence of good faith? AEarnest money deposit BBuydown CContingency payment DRider payment

AEarnest money deposit

A property owner passes away without any heirs to transfer his/her property. Under the State's power of ..........., the property will revert back to the State. AEscheat BCondemnation CEminent domain DForeclosure

AEscheat

The real estate agent serves as a/an ........to their client. AFiduciary BAttorney CConsultant DGeneral agent

AFiduciary

Which of the following is NOT considered real property? ALiving room furniture BOil or natural gas located beneath the property CVacant land DSmall garage

ALiving room furniture

The borrower in a transaction is known as the...? AMortgagor BGrantor CMortgagee DLessee

AMortgagor

What is the highest court in New York State? ANew York Court of Appeals BNew York District Court CJudiciary of New York DNew York Civil Court

ANew York Court of Appeals

Which of the following recommends zoning changes? APlanning Board BDepartment of Buildings CMunicipal Engineer's Office DZoning Board of Appeals

APlanning Board

When protesting a property assessment, the burden of proof falls on the ..........to prove the assessor was incorrect. AProperty owner BAttorney General CReal estate broker DReal estate attorney

AProperty owner

Which of the following is a naturally occurring radioactive gas, which typically enters a house through the basement? ARadon BCFCs CCardon monoxide DEMFs

ARadon

Which of the following allows a commercial tenant the option to match an offer from another prospective tenant? ARight of first refusal BLease option CClaim DRescission

ARight of first refusal

A common term for an easement is a...? ARight of way BAs of right CPossessory interest DVoluntary alienation

ARight of way

Who determines the commission that a broker will receive in a transaction? AThe broker and seller BThe buyer and seller CThe broker and buyer's attorney DThe seller's attorney and the buyer's attorney

AThe broker and seller

What happens to the salesperson's license if the license of their sponsoring broker is suspended? AThe license of the salesperson will also be suspended. BThe license of the salesperson will be revoked and the salesperson will be required to pay a fine. CThe license of the salesperson will automatically be moved under another sponsoring broker in the firm. DThe license of the salesperson will remain active.

AThe license of the salesperson will also be suspended.

Why is the old deed needed to help prepare for the closing? AThe old deed is used to prepare the new need. BThe old deed is used to determine the amount of insurance on the property. CThe old deed is used to prepare the promissory note. DThe old deed is not needed for the closing.

AThe old deed is used to prepare the new need.

If a broker enters into a listing contract, who is considered the client? AThe seller BThe buyer CThe salesperson DThe customer

AThe seller

This process calculates the value of an asset in the past, present, or future? ATime value of money BRate of return CCapitalization rate DInternal rate of return

ATime value of money

If a clause in a contract is illegal, the contract will be considered...? AVoid BVoidable CValid DSuspended

AVoid

If an investor purchased a property for $1,600,000 with a down payment of 30%, what is the cash-on-cash return if the property produces a monthly cash flow of $4,000? A8 Percent (%) B10 Percent (%) C12 Percent (%) D20 Percent (%)

B10 Percent (%)

ow many years of experience does an individual need as a NYS real estate salesperson in order to quality to obtain their broker's license? A1 year B2 years C3 years D4 years

B2 years

If a woman earns $300,000 in capital gains from the sale of her home, on what amount will she have to pay capital gain taxes? A0 Dollars ($) B50,000 Dollars ($) C250,000 Dollars ($) D300,000 Dollars ($)

B50,000 Dollars ($)

Which of the following is considered a leasehold estate? ASingle family house BCooperative CCondominium DMulti-family building

BCooperative

If the seller's broker in a transaction also serves as the mortgage broker to the buyer, what type of agency is created? AImplied agency BDual agency CGeneral agency DUndisclosed agency

BDual agency

Which structural member is located at the bottom of the building's foundation? ASill plate BFooting CGirder DBeam

BFooting

A property manager is an example of a/an .......agent. ASpecial BGeneral CUniversal DDual

BGeneral

When a real estate investor uses other people's money to increase his/her potential return on investment, they are using...? ATime value of money BLeverage CLiquidity DManaged risk

BLeverage

Which of the following is an example of a uni-lateral contract? AExclusive Right to Sell Agreement BOpen Listing Contract CBuyer Representation Agreement DIndependent Contractor Agreement

BOpen Listing Contract

Which of the following is a vertical wood member used to construct walls? ABeam BStud CJoist DSill plate

BStud

Where should a homeowner look to find the exact dimensions of their property? ABlock and lot map BSurvey CPromissory note DProperty inspection report

BSurvey

A broker and seller entered into an Exclusive Right to Sell Agreement. Who is entitled to a commission if the seller finds a buyer themselves? AA commission is not paid to anyone since the seller found the buyer. BThe seller's broker is still entitled to their full commission. CThe seller's broker is only entitled to a pre-determined flat fee. DOnly the buyer's broker is entitled to a commission.

BThe seller's broker is still entitled to their full commission.

If a tenant wants to throw late night parties in their apartment, what clause in the lease may prevent them from doing so? ARenewal clause BUse provisions CStatute of limitations DTerm of the lease

BUse provisions

If a property is purchased for $350,000 and the buyer needs to obtain a $280,000 mortgage, what is the loan to value ratio of the mortgage? A70 Percent (70%) B75 Percent (75%) C80 Percent (80%) D85 Percent (85%)

C80 Percent (80%)

Which of the following is an example of a conventional loan? AAn FHA-insured loan BA VA-guaranteed loan CA loan offered by a commercial bank without any participation by a government agency DA loan backed by FNMA

CA loan offered by a commercial bank without any participation by a government agency

Which of the following manages a cooperative? ABuilding Association BProperty manager CBoard of Directors DOffice manager

CBoard of Directors

Which of the following written instruments is used to convey a grantor's interest in real property? APromissory note BPlot plan CDeed DMortgage

CDeed

Which of the following is used to account for general wear, tear, and obsolescence of an investment property? AAppreciation BCapital gains CDepreciation DPoints

CDepreciation

An umbrella insurance policy is also known as...? ABasic insurance BDual insurance CExcess insurance DFlood insurance

CExcess insurance

Which of the following interests in real property includes the full bundle of rights? AEstate for years BLeasehold estates CFee simple absolute estates DCooperatives

CFee simple absolute estates

Which of the following types of insurance is also known as 'renter's insurance'? AHO-2 BHO-3 CHO-4 DHO-5

CHO-4

Which of the following creates express agency? ASales contract BLease CListing contract DDeed

CListing contract

The right of a property owner whose land borders on a body of water, such as a lake, ocean or sea, to reasonable use and enjoyment of the shore and water the property borders on is known as...? ARiparian rights BSub-surface rights CLittoral rights DAir rights

CLittoral rights

Which of the following contracts creates a general agency relationship between a property owner and a property manager? AListing agreement BSales contract CManagement agreement DManagement proposal

CManagement agreement

Which of the following values refers to the most probably price a property will get in an arm's length transaction? AMortgage value BInvestment value CMarket value DAssessed value

CMarket value

Income earned from a rental property is classified as what? AActive income BPortfolio income CPassive income DCapital income

CPassive income

If a lender refuses to make a loan on a property based on the demographics of the neighborhood of the property, they are most likely guilty of...? ASteering BBlockbusting CRedlining DTesting

CRedlining

If a real estate salespersons license expires, what must they do to get their license re-activated? ARetake the State exam only BRe-apply for their license only CRetake the State exam and submit a new license application DA real estate salespersons license does not expire

CRetake the State exam and submit a new license application

Which of the following is used to help pay for local streets or sidewalks? ACapital gains BRecovery funds CSpecial assessments DAppropriation

CSpecial assessments

What type of agency gives complete authority over any activity of the principal? ASpecial agency BGeneral agency CUniversal agency DExpress agency

CUniversal agency

Disability was added as a protected class to the Fair Housing Act in what year? A1968 B1974 C1980 D1988

D1988

Which of the following is NOT considered a homestead property? ASingle family home BVacant land of 5 acres CAgricultural land DCommercial property

DCommercial property

A device that melts and opens the circuit, causing electric power to stop when overheating occurs is known as a/an...? ACircuit breaker BAmperage CGFCI DFuse

DFuse

Which of the following estates provides the right of possession and control, but not title? AFee simple absolute BLife estate CFee simple determinable estate DLeasehold estate

DLeasehold estate

A ............. is for the rental of floor space this is not generally divided into rooms. AGross lease BNet lease CLand lease DLoft lease

DLoft lease

Which of the following is a measurement of the ability of insulation to slow the transfer of heat or cold? ABTU rating BAmperage CFlashing DR-value

DR-value

Which of the following allows an insured homeowner to be reimbursed for the actual cost of replacing damaged property? AActual cash value BAssessed value CMarket value DReplacement cost

DReplacement cost

Which of the following building materials is a panel that spans between wall studs and covers exterior walls? AFlashing BFascia CSiding DSheathing

DSheathing

Which of the following forms of ownership is limited to married couples? AJoint tenancy BTenancy in common COwnership in severalty DTenancy by the entirety

DTenancy by the entirety

Which of the following clauses in a commercial lease defines how the tenant can and cannot use the space? ALease duration BSubordination clause CEstoppel certificate DUse clause

DUse clause

The Agency Disclosure Form is NOT required for the sale of which of the following properties...? A1-4 family properties BCondominiums CCooperatives DVacant land

DVacant land

When is a real estate salespersons license required by a property manager? AWhen a property manager works exclusively for one owner. BWhen a property manager is an employee of the owner. CWhen a property manager earns a salary from an owner. DWhen the property manager works for more than one owner.

DWhen the property manager works for more than one owner.