Real Estate Exam (National 6)

Generally, what's the common range for loan origination fees? A) 1% to 3% B) 1% to 5% C) 2% to 5% D) 3% to 5%

A) 1% to 3%

Which of the following statements is true about zoning classifications? A) A home business would be considered an accessory use. B) A residential property may only have one use. C) Condos are always commercial property. D) Multi-family housing is zoned commercial.

A) A home business would be considered an accessory use.

Lamar closes on his new home next week. It's a 37-year-old split level, so his agent asked if he's interested in purchasing a home warranty. "Why would I need a warranty?" he wondered. "Didn't the home inspection identify all of the issues?" What's the agent's best response to Lamar's question? A) A home warranty covers things the inspection didn't address, like appliances, as well as structural issues that occur. B) Buying a home warranty almost guarantees you won't have any issues! C) If you purchase a home warranty and something breaks, you can sue the seller. D) The inspection is only as good as the inspector, and there is no guarantee that the inspector found all potential issues.

A) A home warranty covers things the inspection didn't address, like appliances, as well as structural issues that occur.

Margot and Steve owned several rental properties at the time of their divorce. The divorce decree gave ownership to Margot in return for a cash payment by Steve. Fast forward six years, and Margot is ready to sell the properties. She soon discovers, though, that Steve's name is still on the title. What's her best course of action? A) Ask Steve to generate quit-claim deeds on the properties. B) File a suit to quiet title. C) Show the title company a copy of the divorce decree granting her ownership. D) Take Steve back to court to force him to turn the properties over to her.

A) Ask Steve to generate quit-claim deeds on the properties.

Which of these principles of value is related to how a change to a portion of a property impacts the value as a whole? A) Contribution B) Impact on value C) Plottage D) Progression

A) Contribution

What type of loan is neither guaranteed nor insured by government agencies? A) Conventional B) Federal Housing Administration (FHA) C) U.S. Department of Agriculture (USDA) D) U.S. Department of Veterans Affairs (VA)

A) Conventional

In an amortized loan, the interest portion of the mortgage payment generally ______ over the life of the loan. A) Decreases B) Has no bearing on the total C) Increases D) Remains the same

A) Decreases

When Stacy's clients ask her if she can recommend a mortgage broker, she promptly gives them the name of the best mortgage broker she knows, Gary Jones. Later, she always receives a check from Gary as payment for the referral. Is this legal or illegal under the Real Estate Settlement Procedures Act? A) This is illegal under RESPA because it's considered a kickback between settlement service providers. B) This is illegal under RESPA because it's considered a partnership. C) This is legal under RESPA because Stacy has proven experience with the mortgage broker she referred, so it's an honest transaction. D) This is legal under RESPA because the referral fee didn't involve the grantor of credit.

A) This is illegal under RESPA because it's considered a kickback between settlement service providers.

Your clients are looking at buying a $200,000 property with a 30-year loan at a 5% interest rate. If the amortization factor is 5.36822, how much would their principal and interest payment be per month? Remember: The monthly payment multiplier is per $1,000 of the mortgage. A) $1,001.32 B) $1,073.64 C) $1,296.21 D) $1.347.91

B) $1,073.64 (600K / 1,000 = 200 * 5.36822)

Henry submits an offer on a condo and includes an earnest money check for 10% of his offer, which the seller accepts. Later on at closing, he brings a cashier's check for $34,450 (comprising the remaining half of his 20% down payment and $7,950 in closing costs). What's the condo's purchase price in whole dollars? A) $132,500 B) $265,000 C) $344,500 D) $88,333

B) $265,000 ($34,450 - $79,950 = $26,500 * 2 = $53,000 / 0.2)

Lance purchased a home, but he won't own any real estate—just shares in a corporation. This is because his new home is ______. A) A condominium B) A cooperative C) A townhouse D) A triplex

B) A cooperative

What's the penalty for violating federal do not call rules? A) A fine of more than $40,000 for each day violations took place B) A fine of more than $40,000 for each violation C) Restrictions on all business telephone use D) Suspension of the violator's business license

B) A fine of more than $40,000 for each violation

Millie is a buyer who has given her agent an earnest money check for $10,000 with an offer to purchase. When will the check be deposited? A) After Millie receives loan approval for the purchase B) After the seller accepts the purchase offer C) At least 10 days prior to closing on the sale D) Immediately upon receipt by her agent

B) After the seller accepts the purchase offer

Tracy is looking in the MLS and sees a listing marked "REO." Which of these statements regarding REOs is correct? A) An REO property is one that the lender is trying to help the owner sell before beginning foreclosure proceedings. B) Banks acquire REOs through failed foreclosure sales or deed in lieu of foreclosure actions. C) REOs are properties that the lender has given permission to sell for less than the loan amount. D) REOs refer to investment properties a bank owns.

B) Banks acquire REOs through failed foreclosure sales or deed in lieu of foreclosure actions.

Title VIII of which law prohibits discrimination in the sale, rental, and financing of housing? A) Civil Rights Act of 1866 B) Civil Rights Act of 1968 C) Equal Credit Opportunity Act of 1974 D) Housing and Community Development Act of 1974

B) Civil Rights Act of 1968

Residents of Tinytown have been complaining to town officials that the village-like character of their town is being affected by the medium-rise condos that developers are building on the edge of town. In response, local government officials rezoned the areas on the edges of town as parklands. What type of zoning is this? A) Aesthetic zoning B) Downzoning C) Incentive zoning D) Spot zoning

B) Downzoning

A loss in value caused by an undesirable or hazardous influence offsite is which type of depreciation? A) Economic and material B) External depreciation C) Functional obsolesce D) Physical depreciation

B) External depreciation

Your client submits an application to rent a condo unit. He has excellent credit and has had the same job for a long time. He uses a cane to help with his mobility. When his application is rejected, he feels it's due to his disability. He is protected under what federal law? A) Civil Rights Act of 1866 B) Fair Housing Amendments Act of 1988 C) Federal Fair Housing Act of 1968 D) Housing and Community Development Act of 1974

B) Fair Housing Amendments Act of 1988

Stu is buying Freddie's property. What must occur for the transfer of title to take place? A) Freddie and Stu must sign the deed. B) Freddie must intend to convey the property to Stu. C) Stu must convey the deed. D) Stu must sign the deed.

B) Freddie must intend to convey the property to Stu.

As a residential property manager, Finn can independently make decisions regarding the day-to-day operations of the apartment building he manages. He can hire contractors, screen tenants, pay bills, and enforce lease provisions. What kind of agent is Finn? A) Cooperating B) General C) Limited D) Special

B) General

On a closing statement, ______ goes in the seller's credit column and the buyer's debit column. A) Loan fees B) Prepaids C) Taxes D) Utility costs

B) Prepaids

Moira has delivered a counter-offer to some potential buyers for her property. Which of these best states the time frame for the buyers' acceptance? A) The buyers have five days to respond. B) The buyers must respond by the time and date specified in the counter-offer. C) The buyers must respond within the time frame originally noted as their offer acceptance date. D) The counter-offer is active until the seller accepts or rejects it.

B) The buyers must respond by the time and date specified in the counter-offer.

Which of the following statements is true regarding timeshare estates? A) Timeshare estates are illegal. B) Timeshare estates can be sold or passed down to heirs. C) Timeshare estates cannot be passed down to heirs. D) Timeshare estates cannot be sold.

B) Timeshare estates can be sold or passed down to heirs.

What's the purpose of the fixed/adjustable rate note? A) To convert the interest rate from adjustable to fixed B) To convert the interest rate from fixed to adjustable C) To convert the loan from a fixed rate to an adjustable rate D) To convert the loan from an adjustable rate to a fixed rate

B) To convert the interest rate from fixed to adjustable

John's property is shaped like a triangle. The street side is 185 feet, and from the street to the longest point of the triangle is 225 feet. How do you calculate the square footage of John's property? A) Add 185 to 225 B) Multiply 185 by 225, then divide by four. C) Multiply 185 by .5; multiply your answer by 225. D) Multiple 185 x 225

C) Multiply 185 by .5; multiply your answer by 225.

In what way is a townhome similar to a single-family detached home? A) It often has a detached garage. B) It's also detached C) Ownership includes both the structure and the land. D) They're always multi-story

C) Ownership includes both the structure and the land.

Your neighbors build a high-quality addition to their home, increasing its value compared to your own home's value. Because of this, you notice a bump in your property value. Which economic principle is at work here? A) Conditional value B) Price bump C) Progression D) Regression

C) Progression

When a licensee represents a seller, which one of the following statements is true about the licensee's ability to list other properties that are for sale? A) The licensee isn't permitted to list other properties for sale. B) The licensee is permitted to list other properties for sale as long as they're not competing properties. C) The licensee is permitted to list other properties for sale, even if they're competing properties. D) The licensee must list the seller's property only for the first 90 days, after which the licensee may list other properties.

C) The licensee is permitted to list other properties for sale, even if they're competing properties.

Which of these is an example of a sub-agency relationship? A) Aldrich accepts a designated agency appointment from his broker so his firm can represent both the buyer and the seller. B) Blaine represents the buyer in a transaction with an unrepresented seller. C) Greta refers a buyer client to a more experienced colleague, asking for a referral fee from the colleague. D) Morris, who's licensed independently, finds a buyer customer for Greg's listing with Marvel Homes and is obligated to act in the best interest of Marvel Homes' client.

D) Morris, who's licensed independently, finds a buyer customer for Greg's listing with Marvel Homes and is obligated to act in the best interest of Marvel Homes' client.

A rundown home, overgrown with weeds and in desperate need of repairs, is driving down property values on the block. What economic principle is at work here? A) Anticipation B) Contribution C) Progression D) Regression

D) Regression

Which of these statements accurately describes finance- and housing-related legislation? A) As a stipulation of the Housing and Community Development Act, lenders must offer reasons when rejecting loan applications and must respond to all applications within 30 days. B) The Americans with Disabilities Act added familial status and disability (both physical and mental) to the existing protected classes. C) The Equal Credit Opportunity Act of 1974 required lenders to provide consumers with equal access to credit and prohibited credit discrimination based on just the three protected classes of race, color, or national origin. D) The Fair Housing Act of 1968 prohibited discrimination in the sale, rental, and financing of housing based on race, color, religion, or national origin.

D) The Fair Housing Act of 1968 prohibited discrimination in the sale, rental, and financing of housing based on race, color, religion, or national origin.

While walking around the exterior of a rural home she's inspecting, Juanita noticed a metal vent pipe sticking out of the ground 25 feet from the house. She documents this because it may be a sign of what potential environmental hazard? A) Capped well B) Radon vent system C) Septic system D) Underground storage tank

D) Underground storage tank

In contract law, undue influence differs from duress in that duress includes ______. A) Deception B) Fraud C) Trickery D) Use or threat of force

D) Use or threat of force

Regarding documentation, which of the following actions can help a licensee avoid being accused of unauthorized practice of law? A) Disclosing in writing to all parties in a transaction that the licensee isn't a licensed attorney, so there's no licensee liability B) Having a designated broker review and notarize all completed contracts C) Having a designated broker write all contracts from scratch to make them specific to each transaction D) Using approved fill-in-the-blank forms

D) Using approved fill-in-the-blank forms