Real Estate Exam prep

What is the process to make changes to a listing agreement contract? The broker owns the listing and can make changes as needed. All parties must agree to in writing to any changes. The listing agent is the only one that can make changes to the listing contract. All changes can be made by attaching a hand-written note to the existing contact.

All parties must agree to in writing to any changes.

What is the purpose of a carryover clause? Protects the seller if the buyer cancels the sale Allows a six-week extension to the listing contract Allows the broker to collect a commission for some period of time after the listing expires Prevents the seller from doing an FSBO sale up to six months after the listing expires

Allows the broker to collect a commission for some period of time after the listing expires

Which of the following referral fees are NOT prohibited by RESPA? Title search referral fees Fees among cooperating brokers Title insurance referral fees Inspection referral fees

Fees among cooperating brokers

A borrower has a $770,000 interest-only loan @ 5.5% interest. What are the monthly interest payments? $4,235 $1,855 $3,529 $3,111

$3,529

Determine the monthly interest on a loan with a balance of $168,300, a monthly payment of $1,356.80, and an interest rate of 7.75%? $1,086.94. $1,304.33 $866.67 Cannot be determined.

$1,086.94.

An apartment's rent is scheduled to increase by 4.4%. If the current rent is $1,255, what will the new rent amount be? $1,310 $1,283 $1,324 $1,200

$1,310

The Pickets are purchasing a home for $78,000, and the lender is giving them a 90% loan at 10% interest, plus a 2% loan origination fee. How much is the loan origination fee? $1,404 $1,560 $1,650 $7,020

$1,404

The Browns obtain a fixed-rate amortized 30-year loan for $310,000 @ 6% interest. If the monthly payments are $1,815, how much interest do the Browns pay in the first month of the loan? $1,815 $1,550 $265 $1,495

$1,550

Christine has monthly loan payments of $1,857. Her loan is for $300,000 @ 6.3% interest. How much of her first payment goes towards interest? $1,757 $100 $1,575 $282

$1,575

A restaurant generates $72,000 in sales per month. The lease calls for 2.2% percentage rent. What is the monthly rent amount? $1,584 $2,160 $1,440 $1,100

$1,584

A school district's tax rate is 10 mills. The school district's required revenue from taxes is $1,000,000. What is the tax base of the area? $1,000 $1,000,000 $10,000,000 $100,000,000

$100,000,000

A farmer wants to net at least $10,000/acre on the sale of his 80-acre property. If he allows for a total of 10% for commissions and closing costs, what should his listing price be per acre? Assume the farmer has no mortgage. $11,111 $11,000 $10,000 $10,900

$11,111

An investment property's return on equity ratio is 15%, and the owner has $85,000 of equity. What is the property cash flow? $10,200 $12,750 $566,667 $708,333

$12,750

Christy has monthly loan payments of $1,200. Her loan is for $210,000 @ 6.1% interest. How much of her first payment goes towards principal? $132.50 $0 $205 $177.50

$132.50

A building has a Potential Gross Income of $145,000 with vending receipts of $5,000 and a vacancy rate of 5%. The annual expenses of the building are $15,000 in taxes, insurance $4,000, maintenance $10,000, utilities $6,000, repairs $3,500, legal fees $1,500, management fees @ 4% of Effective Gross Income. What is the Effective Gross Income of the property? $162,000 $145,000 $142,750 $135,000

$142,750

A property has been depreciated @ $3,000 for 15 years. The land, which comprises 20% of total value is worth $20,000. What was the original value of the property? $80,000 $100,000 $125,000 $145,000

$145,000

A homeowner has a mortgage balance of $149,570.75. If the interest rate on the loan is 9.5% and the monthly payment is $1,303.55 what will be the mortgage balance after the next two payments? $148,630.90 $149,850.21 $148,300.00 $149,330.91

$149,330.91

A new home sold for $350,000. The tax rate is $.825 per hundred or fraction thereof. How much will the annual taxes be on this property? $287.00 $287.50 $2,887.00 $2,887.50

$2,887.50

If a salesperson sells 3/4 of an acre for $80,000, what was the price per square foot rounded to two decimal spaces? $2.45 $3.00 $1.49 $1.50

$2.45

The subject has $8,000 pool and a $2,000 chimney but no porch. A comparable that sold for $199,000 has a $3,000 porch but no pool or chimney. Assuming all else is equal, what is the adjusted value of the comparable? $206,000 $186,000 $189,000 $192,000

$206,000

A property is being appraised by the Cost Approach. The appraiser estimates that the land is worth $17,000 and the replacement cost of the improvements is $235,000. Total depreciation from all causes is $23,000. What is the indicated value of the property? $229,000 $275,000 $252,000 $212,000

$229,000

A home that was purchased for $440,000 with a $320,000 loan is now worth $530,000. The current loan balance is $280,000. What is the homeowner's equity? $120,000 $160,000 $250,000 $280,000

$250,000

A property's return on equity ratio is 28% and generates a cash flow of $70,000. How much equity does the owner have (to the nearest hundred)? $216,700 $18,900 $235,000 $250,000

$250,000

A homeowner bought a house one year ago for $250,000. Since then, the homeowner has spent $4,000 to pave the driveway and has added a screen porch at a cost of $3,000. Total depreciation has been $6,000. What is the homeowner's adjusted basis? $257,000 $251,000 $263,000 $237,000

$251,000

A fine jewelry store leased a space at the mall with a base rent of $1,800 a month, plus 4% of all sales over $200,000. If the gross sales were $325,000, what was the total amount of rent paid by Heinz Fine Jewelry at the end of the year? $26,600 $21,600 $125,000 $5,000

$26,600

A property has sold for $185,000. The listing agreement calls for a commission of 6.5%. The listing broker and selling broker agree to share the commission equally. What will the listing agent receive if the agent is scheduled to get a 65% share from his broker? $3,908 $2,109 $4,209 $4,467

$3,908

A borrower has a monthly payment of $1,980 on a loan with a monthly constant of 6.45. What is the loan amount (to the nearest hundred)? $354,800 $283,300 $198,000 $307,000

$307,000

A $340,000 property sells at a 7% commission with a 50-50 co-brokerage split and a 50% agent split with her broker. What is agent's commission? $7,140 $5,950 $11,900 $5,440

$5,950

Brittany bought a house five years ago for $100,000 and obtained an 80% loan. Now the home is worth $125,000, and her loan balance has gone down $5,000. What is Brittany's current equity? $125,000 $75,000 $50,000 $45,000

$50,000

On a $50,000 loan the borrower is required to pay 2 points. How much does the borrower have to pay the lender? $49,000.00 $50,000.00 $51,000.00 $52,000.00

$51,000.00

Jackie obtains a 60% LTV loan on her new $250,000 home with an annual interest rate of 5.5%. What is the first month's interest payment? $688 $1,146 $458 $750

$688

An office building has a Potential Gross Income of $12,600 per year. The vacancy rate is 5%, and the annual expenses are $3,600. What is the market value if the capitalization rate is 12%? $15,120.00 $69,750.00 $99,750.00 $105,000.00

$69,750.00

Mr. Jones wanted to make a $50,000 profit after paying his first mortgage of $21,275 and paying a 6% commission. What would the sale price have to be? $53,000 $74,275 $75,552 $75,825

$75,825

An office building sells for $979,000 at a cap rate of 8.3%. What is its NOI? $97,900 $85,173 $92,772 $81,257

$81,257

The current value of a property is $60,000. For real estate tax purposes, the property is assessed at 30 percent of its current value, with an equalization factor of 1.25 applied to the assessed value. If the tax rate is $4 per $100 of assessed valuation, what is the amount of tax due on the property? $720 $900 $1,800 $2,250

$900

If a corporate building has nine office suites that rents for $14,800 per month each, but suffers from a 14% vacancy rate and annual expenses of $21,100, what is the NOI of the building (round to the nearest $100)? $93,500 $1,353,500 $133,200 $84,600

$93,500

Two parcels of land priced at $1,500 per acre were purchased. One parcel was 25 acres in size and the other was 1 mile square in size. How much did these two parcels cost together? $965,000 $979,500 $997,500 $960,000

$997,500

The loan officer at 2nd National Bank tells Lana she can afford a monthly payment of $1,900 on her new home loan. Assuming this is an interest-only loan, and the principal balance is $410,000, what interest rate is Lana getting? 0.0556 0.0463 0.0616 0.0702

0.0556

If you owe $14,000 on a new loan and pay $880 of interest for the year, your interest rate is? 0.048 0.123 0.057 0.063

0.063

What is 25% converted to a decimal? 25.0 2.50 0.25 0.025

0.25

How much is a discount point? 1/8% of the loan amount $1,000 1% of the loan amount $100

1% of the loan amount

Jerry recently obtained a 75% loan on his $410,000 home, and he had to pay $5,600 for points. How many points did he pay? 1.4 points 1.8 points 5.6 points 2.8 points

1.8 points

Under what type of compensation plan is the agent responsible for the costs of advertising and promotion? 70% plan 80/20 plan Net plan 100% plan

100% plan

A strip mall generates $215,000 in effective rental income and $3,000 in other income. The same mall has $102,000 in operating expenses and $15,000 as reserves. What is the Net Operating Income of the strip mall? $113,000 $99,000 $101,000 $116,000

101,000

An income property generates $22,000 per month, and is valued at $2.4 million. What is its Gross Rent Multiplier? 109 9.09 90.9 115

109

An investor just purchased a rectangular 1-acre retail lot for $250 a frontage foot. If she paid $100,000 total, what was the depth of the lot? 109 feet 400 feet 174 feet 250 feet

109 feet

A property is purchased for $480,000. The land is valued at 10% of the initial purchase price of the property. Given a 39-year depreciation term, what is the annual depreciation expense? $12,308 $5,333 $18,720 $11,077

11,077

What is the GIM of a strip mall with an annual income of $547,500 and a value of $6,345,000? 8.6 139.1 103.2 11.6

11.6

An apartment building contains twenty units. Each unit rents for $900 per month. The vacancy rate is 5%. Annual expenses are $17,500 for maintenance, $7,200 insurance, $7,500 taxes, $6,400 utilities, $7,500 mortgage debt and 10% of the Gross Effective Income for the management fee. What was the investor's rate of return for the property if she paid $1,170,000 for the property? 7.6% 8.9% 12.48% 22.05%

12.48%

How many acres are there in the N ½ of the NE ¼ and the NE ¼ of the SE ¼ of a section? 20 acres 40 acres 80 acres 120 acres

120 acres

A property sells for $140,000 two years after it was purchased. If the annual appreciation rate is 6%, how much did the original buyer pay for it? $122,500 $125,000 $121,740 $124,600

124,600

The lender quotes closing costs of $800 plus 2 points on a $610,000 loan. How much will the borrower have to pay? $13,000 $6,100 $16,050 $11,400

13,000

A home seller wants to net $15,000. If he has agreed to pay a 5% commission, the loan payoff is $94,000 and closing costs are $16,000, what must the minimum listing price be? Round to the nearest $100. $125,000 $130,700 $136,300 $131,600

131,600

Each unit in a fourplex rents for $850 per month. If the appraised value is $460,000, what is the GRM for the fourplex? 541.2 135.3 45 11.3

135.3

If a borrower's monthly interest payment on an interest-only loan at an annual interest rate of 7.3% is $877, how much was the loan amount (rounded to the nearest hundred)? $120,100 $100,300 $144,200 $134,200

144,200

An FHA-insured loan in the amount of $57,500 at a 6 ½% interest rate for 30 years was closed on March 17. The first monthly payment is not due until May 1. If the interest is paid monthly in arrears, how much pre-paid interest does the buyer owe at closing? (Use a 360-day year) $145.32 $311.52 $551.20 $3,737.50

145.32

If a square-shaped lot measures 125' on one side, what is the square footage of the lot? 250' 15,625 square feet 500' 1,855 square feet

15,625

Land sells for $9,000 an acre. What will 750,000 SF of land sell for? Round to the nearest thousand. $105,000 $16,000 $129,000 $155,000

155,000

A property is being appraised by the Cost Approach. The appraiser estimates that the land is worth $33,000 and the replacement cost of the home is $110,000. A new $20,000 garage was recently added. Total depreciation from all causes is $7,000. What is the indicated value of the property? $170,000 $156,000 $136,000 $123,000

156,000

Assuming that the listing broker and the seller broker in a transaction split their commission equally, what was the sales price of the property if the commission rate was 6 ½ percent the listing broker received $5,187? $159,600 $79,800 $119,700 $179,800

159,600

Terry bought a home that home that had an attached one-car garage and a screened porch that spanned the length of the home. If the garage measured 16' in depth which was half the depth of the house and the screened porch was 64' in width, what is the GLA of the house? 1,024 SF 2,048 SF 3,072 SF 4,096 SF

2,048 SF

A tax rate on a building with a $530,000 taxable value is 4.5 mills per thousand dollars of assessed valuation. What is the annual tax liability? $23,850 $1,590 $2,385 $15,900

2,385

A sale transaction on rental property closes on December 10th. The landlord received the December rent of $4,400 on December 1. Assuming the closing day is the seller's, and that the 360-day method is used for prorating, how much will the seller owe the buyer? $1,419 $1,467 $2,933 $2,981

2,933

A town has a tax base of $411,000,000 and a budget of $850,000. What is the tax rate in terms of mills? 21 mills 4.8 mills 48 mills 2.1 mills

2.1 mills

Jerry recently obtained a 65% loan on his $295,000 home, and he had to pay $4,300 for points. How many points did he pay? 2.2 points 1.5 points 1.8 points 3.4 points

2.2 points

A 198-foot x 330-foot lot sold for $30,000. What was the price per acre? $20,000 $21,780 $30,000 $43,560

20,000

If a lot contains 48,000 square feet and is 240' wide, how deep is the lot? 480' 240' 200' 720'

200

What is the volume of a 90' x 20' x 12' house? 21,600 cubic feet 1,800 cubic feet 3,750 cubic feet 36,000 cubic feet

21,600

The Brooks' paid-off property sold for $247,600. What will they net after paying a 7.5% commission to their broker? $215,830 $219,700 $227,792 $229,030

229,030

A lender offers an investor a maximum 85% LTV loan on the appraised value of a property. If the investor pays $160,000 for the property how much will the investor have to pay as a down payment? $16,000 $32,000 $136,000 $24,000

24,000

If a buyer purchases 25% of a lot in the spring and then purchases 50% more later in the fall, what percentage of the lot is still available for purchase? 20% 25% 50% 75%

25%

A lender determines that a homebuyer can afford to borrow $220,000 on a mortgage loan. The lender requires an 85% loan-to-value ratio. How much can the borrower pay for a property and still qualify for this loan amount (to the nearest $1,000)? $187,000 $243,000 $254,000 $259,000

259,000

A building generates $103,000 in effective rental income and $900 in vending machine income. The same complex has $40,700 in operating expenses and $36,000 in debt service payments. What is the pre-tax cash flow of the complex? $26,300 $67,900 $27,200 $62,300

27,200

A five-sided lot has the following dimensions: side A = 44', side B = 67', side C = 91', side D = 18', and side E = 55'. What is the perimeter of the lot? 257 feet 220 feet 320 feet 275 feet

275

Sean, age 37, sold the home he purchased three years ago and now rents an apartment. He had originally purchased his home for $86,500 and sold it for $115,300. What is Sean's capital gain? $11,320 $16,980 $28,800 $0

28,800

Rich, a licensed salesperson, took 12 hours of continuing education courses during the current licensing period. How many of those hours had to represent "Core" courses? 12 9 3 6

3

RESPA requires lenders to provide a HUD "Guide to Settlement" booklet and a Good Faith Estimate (GFE) of all costs related to settlement to borrowers within 5 days of loan application. 3 days of loan application. 2 days of loan application. at time of loan application.

3 days of loan application.

Tom, a licensed salesperson for 20 years obtains his broker's license during the current licensing period. Which of the following will Tom have to take in order to renew his license? 3 hours of core - 9 hours of electives 6 hours of core - 6 hours of electives 24 hours of continuing education 24 hours - Missouri Real Estate Practices Course

3 hours of core - 9 hours of electives

Ralph is buying Terry's house. The buyer's loan amount is $105,580. If the buyer has agreed to pay 3 points at closing, how much will he pay for the points? $4,223 $1,584 $396 $3,167

3,167

Agent Daisy agrees to a 5% commission to list a home at $330,000. The property is sold through another cooperating brokerage with that firm to receive 50% of the total commission on the $330,000 sale. If Daisy receives 55% of her broker's commission and does not bring the buyer, how much does Daisy's broker receive from the sale? $16,500 $8,250 $4,537.50 $3,712.50

3,712.50

A buyer secured a $125,000 loan at 4.5% interest rate. To receive a lower interest rate, the buyer was required to buy down three discount points. How much were the discount points? $3,550.00 $3,750.00 $4,250.00 $3,892.00

3,750.00

What is the typical time period required to maintain escrow records? 3-5 days 3-5 weeks 3-5 months 3-5 years

3-5 years

Shelly bought a house five years ago for $150,000 and obtained an 80% loan. Now the home is worth $140,000 and her loan balance has been reduced by $12,000. What is Shelly's current equity? $32,000 $42,000 $44,000 $2,000

32,000

Anne obtains a new loan @ 80% of her home's price of $740,000. The loan constant is 5.645. What is Anne's monthly payment? $4,177 $3,342 $5,645 $2,883

3342

An investor paid $43,000 for a lot and $520,000 to have a strip mall constructed on it. He has depreciated the property for the past 15 years on a 39-year straight-line schedule. If he sells the property this year and realizes $710,000 after closing expenses, what is his capital gain? $233,000 $190,000 $347,000 $433,000

347,000

Dan is buying Jessica's house. The closing date (day belongs to seller) of the sale transaction is March 9th. Current year real estate taxes are $1,900 (will be billed to Dan next year). Use the 365-day method for prorating. What is Jessica's share of the real estate taxes for the current year? $364 $390 $354 $1,546

354

As a legal descriptor of land, a township area consists of nine sections. thirty-six square miles. 640 acres. one square mile.

36 sq miles

As a legal descriptor of land, a township square consists of one section. 36 square miles. 640 acres. 1 square mile.

36 square miles.

A home sells for $150,000 and has a mortgage loan balance of $100,000 at closing. If the commission is 5% and other closing costs are $6,000, what is the seller's net? $44,000 $40,000 $32,250 $36,500

36,500

A property is being appraised using the Income Capitalization Approach. Annually, it has an estimated gross income of $48,000, vacancy and credit losses of $3,600, and operating expenses of $15,000. Using a capitalization rate of 8%, what is the property's value (rounded up to the nearest $1,000)? $413,000 $368,000 $340,000 $600,000

368,000

Stacey owns a lot that has 180 feet of front footage and contains 36,000 square feet. He purchases two identically-sized lots adjacent to each side of his lot. These side lots are each 200 feet deep and each side lot contains 19,000 square feet. What is the total front footage of all three lots? 190 200 275 370

370

Stacey owns a lot that has 180 feet of front footage and contains 36,000 square feet. She purchases two lots adjacent to each side of his lot. These side lots are each 200 feet deep and contain 19,000 square feet. What is the total front footage of all three lots? 190 200 275 370

370

If a borrower had an interest rate of 5 1/4 percent and refinanced, lowering the interest rate by 3/8 percent, what is the amount of interest after refinancing? 4 ½ percent 5 percent 4 ¾ percent 4 7/8 percent

4 7/8

Phillip advised his clients they needed to paint their master bedroom before showing the property. The walls of this room were 11' high. The wall lengths were 13', 19', 13', and 17'. If a gallon of paint covers 180 SF, how many whole gallons would the home sellers have to buy? 3 gallons 4 gallons 5 gallons 8 gallons

4 gallons

A home costing $540,000 is worth $588,000 two years later. What is the one-year appreciation rate? 8.8% 4.4% 4.1% 5.0%

4.4%

If an investor wants to combine a 5/8 acre parcel with a 3.9-acre parcel, how big will the parcel be, expressed as a decimal? 4.675 acres 4.525 acres 3.2750 acres 4.58 acres

4.525 acres

What is 0.0475 converted to a percentage? 4.75% 0.475% 47.5% 475%

4.75%

A house sells for $237,000. What would Jane's commission rate be as a percent if she received a check for $11,400? 4.6% 4.8% 6.2% 5.4%

4.8%

Calculate how many acres are in the Southwestern 1/4 of the Northern 1/2 of the Eastern 1/2 of Section 14. 20 40 80 120

40

How many acres are there in the S 1/2 of the N 1/2 of the SW 1/4 of a section of land? 10 acres 20 acres 40 acres 160 acres

40 acres

Stacey owns a lot that has 180 feet of front footage and contains 36,000 square feet. She purchases two lots adjacent to each side of his lot. These side lots are each 200 feet deep and contain 19,000 square feet. What is the total front footage of all three lots? 190 200 275 370

40,000

On an 8% straight term loan of $6,071 the borrower paid total interest of $1,700. What is the term of the loan? 30 months 36 months 42 months 48 months

42 months

A commercial builder has a downtown lot with 250 frontage feet on Broadway. The lot is 200' deep. By code, the builder must allow for a 15' setback on Broadway, and 10' on both sides of the lot. How many square feet does the builder have left to build on? 46,000 SF 50,000 SF 42,300 SF 42,550 SF

42,550 SF

An acre contains: 3840 square feet. 6490 square feet. 34,875 square feet. 43,560 square feet.

43,560 square feet.

Six years ago a commercial property owner paid $490,000 for her complex which included 10 acres of land valued at $100,000. Using a 40-year straight-line depreciation method, what would be the current value of the apartment complex? $330,000 $390,000 $400,000 $431,500

431,500

An apartment complex generates $905,000 in effective rental income and $14,000 in other income. The same complex has $415,000 in operating expenses and $39,000 as reserves. What is the Net Operating Income of the complex? $490,000 $504,000 $465,000 $451,000

465,000

The buyer was required to pay $4,000 in discount points. The loan balance was $80,000. How many points did the lender require? 3 4 5 6

5

A $150,000 loan has monthly interest-only payments of $1,000. Its annual interest rate is 3 percent. 6.5 percent. 8 percent. 12.5 percent.

8%

A rented office space has a monthly income of $3,800. A suitable Gross Income Multiplier derived from market data is 11.1. What would the estimated value be? Round to the nearest $1,000. $380,000 $422,000 $506,000 $342,000

506,000

A property currently valued at $450,000 is expected to appreciate 8% each year for the next 3 years. What will be its appreciated value at the end of this period? $524,880 $566,870 $474,000 $558,000

566,870

A seller wants to net $55,614 from the sale of her house after paying a 7% commission. Her minimum sales price will have to be? $55,341 $59,506 $59,800 $63,000

59,800

How many broker members are there on the MREC? 4 5 6 7

6

A shopping mall grosses $625,000 / month. If the market value of this property is $52,000,000, what is its gross income multiplier (GIM)? 6.9 10.4 7.7 83.2

6.9

A sale transaction closes on April 15th. The day of closing belongs to the seller. Real estate taxes for the year, not yet billed, are expected to be $2,110. According to the 365-day method, what is the seller's share of the tax bill? $626 $675 $607 $721

607

A developer wants to develop an 18-acre subdivision. He figures that the streets and common area will take up about 20% of this overall area. If the minimum lot size is to be 10,000 SF, how many lots can the developer have on this property? 78 lots 18 lots 62 lots 48 lots

62

A seller of a property, listed at $200,000, accepted a 90% offer. The home appraised at $185,000 and the buyers obtained a loan for 85% for 30 years at 5% interest. What is the first month's interest? $637.50 $7,650 $737.50 $6,750

637.50

Tyler Holdlong owns a small retail property that he inherited from his father. There are no mortgages or interest expenses connected with the property. Tyler takes an annual cost recovery expense of $3,000. The property has a monthly gross income of $3,500 and monthly operating expenses of $1,100. Tyler's taxable income from this property will be taxed at a rate of 25%. What is the tax liability for the year? $10,500 $7,950 $7,200 $6,450

6450

A developer wants to develop a 20-acre subdivision. He figures that the streets and common area will take up about 25% of this overall area. If the minimum lot size is to be 10,000 SF, how many lots can the developer have on this property? 43 65 86 66

65

An apartment building has $105,000 net income and sold for $1,450,000. What was the rate of return? 7.2% 13.8% 8.3% 9.1%

7.2%

If a hotel has an annual Net Operating Income of $812,000 at a 9.35% cap rate, what is its current value (to the nearest thousand)? $7,592,000 $9,350,000 $8,684,000 $6,767,000

8,648,000

Amy agreed to a contract price of $100,000 for a home and secured a mortgage loan for $80,000. If the appraised value is $110,000, what is the loan to value ratio? 100% 82% 80% 125%

80%

To renew an active license, how many elective hours of continuing education do you need? 3 hours 6 hours 9 hours 12 hours

9 hours

A house sold for $42,000. The buyer made a 20% down payment. Monthly interest on the loan was $252. What was the interest rate on the loan? 5% 7% 9% 11%

9%

Violet has a FHA loan for $90,000. The lender is requiring a 1% discount point to the lower the interest rate. What amount is the lender charging for the discount point? $600.00 $90.00 $900.00 $1,000.00

900.00

Seller Chris receives an offer of $130,000 on a property he listed at $142,000. How much is the offer as a percent of the listing price? 93% 90.2% 91.5% 89.7%

91.5%

Seller Trevor receives an offer of $181,000 on a property he listed at $193,000. The property has been appraised at $198,000. How much is the offer as a percent of the listing price? 91.4% 97.5% 95.2% 93.8%

93.8%

Natalie wants to make a 25% profit on her $70,000 land investment (there is no mortgage). She figures agents charge a 6% commission, and that closing costs will be an additional $1,200. What should she accept as a final sale price (to the nearest hundred)? $87,500 $100,500 $94,400 $106,700

94,400

If a rectangular office space is 72 feet wide and has a 410-foot perimeter, what is its area? 9,576 square feet 19,152 square feet 5,184 square feet 7,755 square feet

9576

An apartment building that sold for $780,000 had a monthly gross income of $8,000. What is its monthly Gross Rent Multiplier? 97.5 62.4 103 158

97.5

When the amortized payment of a mortgage remains constant over the period of the loan but leaves an outstanding balance to be paid at the end, this payment is called: An escalation payment A balloon payment A satisfaction payment An acceleration payment

A balloon payment

What is a short sale? A lender forces the sale of a mortgaged property without first giving notice of default. A deficiency judgment forces a defaulted borrower to sell personal property to settle a debt. A borrower sells the mortgaged property for less than what is owed on the loan balance. A foreclosed property is sold quickly at a public auction instead of through a standard sales process.

A borrower sells the mortgaged property for less than what is owed on the loan balance.

A buyer will receive a utility bill for an estimated $400 at the end of the month. At closing, the seller has used an estimated $100 of the bill. What should appear on the closing statement? A credit to the buyer for $100 and debit to the seller for $100 A credit to the buyer for $300 and debit to the seller for $300 A debit to the buyer for $100 and a credit to the seller for $100. A credit to the buyer of $200 and a debit to the seller of $200.

A credit to the buyer for $100 and debit to the seller for $100

Which of the following individuals would be required to have a real estate license? An attorney An auctioneer employed by the owner A friend of a licensee who receives compensation for referring a client to the licensee A developer selling Missouri land owned by the developer.

A friend of a licensee who receives compensation for referring a client to the licensee

Which is NOT a conveyance clause? A granting clause. A habanero clause. A reserving clause. A tenendum clause.

A habanero clause.

The definition of depreciation is A loss in value. Mortgages and foreclosures. Loss from scarcity of a product. A gain from cost.

A loss in value.

The purpose of a buffer zone is to accomplish which of the following? Privacy space between residences in an upscale subdivision. A neutral zone between differing forms of land use. Isolation of a non-conforming use in a municipality. A green area for large-scale residential developments.

A neutral zone between differing forms of land use.

What is the definition of a principal? A broker who owns a real estate firm A person who delegates another to act on his or her behalf through an agency relationship Someone who buys a property directly from an owner with no representation A person who expects loyalty and accounting from the person who purchases the property

A person who delegates another to act on his or her behalf through an agency relationship

The Metes and Bounds method of surveying is based primarily upon: A point of beginning. A map of the subdivision. Survey lines that run north and south. Survey lines that run east and west.

A point of beginning.

What provision is required in a mortgage to allow a non-judicial foreclosure to force a sale without a foreclosure suit? An indemnification clause. A power of attorney clause. A power of sale clause. A legal remedy clause.

A power of sale clause.

Which of the following is an executory contract? An expired lease. A sale contract before closing. A recorded sale contract. An option to buy after it is exercised.

A sale contract before closing.

What is the statute of limitations? A set period of time during which an injured party can rescind a contract A limit on the amount of damages an injured party can claim. A clause allowing either party in a contract to withdraw within a certain period. A time limit in which to complete and sign a contract.

A set period of time during which an injured party can rescind a contract

What is a "buffer zone?" A transitional zone between a residential zone and a commercial zone. An area zoned as a public park. A temporary zone created to allow users to come into compliance with a change in zoning. A zone around the boundaries of a municipality.

A transitional zone between a residential zone and a commercial zone.

What is special about a universal agent? A universal agent has power of attorney. A universal agent has veto power. universal agent has unilateral power. A universal agent has statutory powers.

A universal agent has power of attorney.

A standardized yardstick expressing the true annual cost of borrowing is expressed as a/an ECOA Regulation Z APR RESPA

APR

Which two factors determine a building's potential for generating income? Location and style Deprecation and insurance expenses Ability to attract tenants and operating expenses Overhead and expenses

Ability to attract tenants and operating expenses

A person with a broker's license who wishes to operate as a salesperson for another broker could do all EXCEPT Apply to the MREC for a broker-salesperson's license Send his broker's license with the proper fee to the MREC for safekeeping Act as a sales-manager in a branch office and continue to take listings and sell property Act as the broker in a corporation

Act as the broker in a corporation

An agent owes all but which of these to his or her customer? Disclosure Funds accounting Advertising Skill

Advertising

Which of these is not a tool to help evaluate advertising effectiveness? Telephone log Code in a print ad Advertising budget Designated telephone number

Advertising budget

Which of these is not a way a buyer's agent might receive compensation? Seller pays the compensation. Buyer pays a flat fee. The agent receives a retainer. Agent gets everything above the net price set by the seller.

Agent gets everything above the net price set by the seller.

Which of the following situations would give concern about working for the Sunny Valley Brokerage? The office holds weekly staff meetings. Most agents appear successful. Agents seem to come and go quickly. Office has a selection of training materials.

Agents seem to come and go quickly.

Which of these items is not included in a lease agreement? Use provisions Demising clause Description of premises Alienation clause

Alienation clause

Which is true when a corporation receives a broker's license? All brokers licensed under the corporation must be officers of the corporation. All corporate officers involved in the management of the brokerage business must have active broker-officer licenses. All corporate officers must have active salesperson license. When the license is issued to the corporation, the individual officers will no longer require individual licenses.

All corporate officers involved in the management of the brokerage business must have active broker-officer licenses.

Seller Janet delivers a disclosure statement to Buyer Amanda. Amanda reads it over and decides everything looks good enough to continue with the purchase. A few weeks later, a major hail storm damages the roof and now it leaks. So the original disclosure is no longer accurate. Which statement is false? Janet should amend the disclosure statement and deliver it to Amanda. Janet can correct the damage to the roof and tell Amanda nothing. Amanda can rescind the purchase agreement within three business days after she receives an amended disclosure. Amanda can require Janet to replace the roof.

Amanda can require Janet to replace the roof.

Which of the following describes a mortgage that requires principal and interest payments at regular intervals and calls for the liquidation of the debt by periodic installments until the debt is satisfied? Amortized loan Annuity loan Acceleration loan Assemblage loan

Amortized loan

After a listing agreement is signed, and if the agent is a member of a marketing service called a Multiple Listing Service (MLS). What specific form must be completed before the agent can post and market the property to other licensees who are members of MLS? MLS Form BB-1 A copy of the original listing agreement The original listing agreement An MLS form.

An MLS form.

What document is submitted to the MLS when a listing agreement is signed? A copy of the original listing agreement The original listing agreement An MLS listing form Form 45-A

An MLS listing form

If a life tenant purposely damages or misuses a property it is known as what? Pillage An act of contempt Vandalism An act of waste

An act of waste

A listing agent who shows property to a ready, willing, and able buyer still has certain obligations to the buyer. Which of the following is not a true statement? An agent shall disclose to the buyer all material facts about the property and explain the term "AS IS" in any counter offers to purchase. An agent must disclose to the buyer all personal and financial facts regarding the seller's reasons for selling the property. An agent must not discourage the use of an attorney or require the buyer to use a specific lender, insurance company, title company, appraiser, survey company, or building inspection company. An agent must promptly tender to the buyer any contract offer that has been accepted, rejected, or countered by the seller.

An agent must disclose to the buyer all personal and financial facts regarding the seller's reasons for selling the property.

The best definition of an appraisal is: A means of determining depreciation. A method to keep values current with reproduction cost. A statement of facts that may not be necessarily true. An estimate of value.

An estimate of value.

On which of the following written listings would the listing broker be entitled to compensation regardless of who sells the property? An open listing An exclusive right to sell An exclusive agency agreement Agency listing

An exclusive right to sell

The primary survey line running east and west in the rectangular survey system is the: Township line. Base line. Range line. Principal meridian.

Base line.

Which principle of value holds that a property can increase or decrease in value in expectation of something in the future? Conformity Highest and best use Anticipation Contribution

Anticipation

If an individual broker dies (there is no other broker in the company) who can be appointed as a "Temporary broker" and for what purpose? Anyone licensed or not can be appointed as a "Temporary broker" to "Terminate the existing transactions," close the company, and return all the salespersons' licensees to the MREC only a licensed broker from another company can become a "Temporary broker" only a salesperson who is licensed to the company can become the "Temporary broker" there is no such thing as a "Temporary broker" the company has to close immediately

Anyone licensed or not can be appointed as a "Temporary broker" to "Terminate the existing transactions," close the company, and return all the salespersons' licensees to the MREC

Which statement about property management is FALSE? Property management is a specialized field in real estate. A property manager is a fiduciary. Asset manager and resident manager mean the same thing. A management agreement is an employment contract between the owner and the manager.

Asset manager and resident manager mean the same thing.

Which method can be helpful in tracking your advertising results? Mark outs Error codes Assigning a code Back testing

Assigning a code

Which of the following methods allows you to keep track of your advertising results? Mark outs Assigning a code Override notes Run testing

Assigning a code

As a condition of license renewal, all active salespeople must complete the following: Three hours of required core curriculum by June 30th and nine hours of elective courses by September 30th. Attend at least 1 hour of a continuing education lecture every other month throughout the licensing period. Attend 6 hours of core curriculum courses and 6 hours of elective courses during the renewal period. Attend 12 hours of certified continuing education courses, 3 hours of core credit and 9 hours of elective credit, by September 30th of even years.

Attend 12 hours of certified continuing education courses, 3 hours of core credit and 9 hours of elective credit, by September 30th of even years.

AIDA stands for Allowance, Involvement, Develop, and Action Attention, Interest, Desire, and Action Action, Involvement, Detail, and Allowance Advanced, Intake, Design, and Action

Attention, Interest, Desire, and Action

Which is NOT one of the three factors needed for the capacity to contract? Being currently employed. Being of legal age. Being of legitimate authority. Being of mental competency.

Being currently employed.

"Let's not do business with AVC Real Estate Company; they discount their commissions" is an example of what? Price fixing Boycott Market allocation Tying agreement

Boycott

To renew a salesperson's inactive license, how often must the licensee pay? Once -- when the license goes inactive. Once a year to the MREC. Never. An inactive licensee never has to renew. He/she is inactive for life. By Sept 30 of even years.

By Sept 30 of even years.

Before a buyer broker shows a property, what must he or she disclose to the seller? Seller agency relationship Subagency relationship Buyer agency relationship Dual agency relationship

Buyer agency relationship

Which type of agency would be most advantageous to a buyer? Broker's agency Buyer brokerage Designated agency Consensual dual agency

Buyer brokerage

What is the arrangement called when the agent is accountable only to the buyer? Buyer's agent Seller's agent Broker's agent Assigned agent

Buyer's agent

A client asks you the following specific question: "Would you live in this home or this neighborhood?" How should you answer? By answering whatever will get a sale By focusing on factual statements based on various features within the home By stating opinions based on the local demographics By stating that you have to turn him in to HUD for asking a question that violates fair housing laws

By focusing on factual statements based on various features within the home

How does the judicial system influence real estate ownership? By levying property taxes. By enforcing zoning ordinances and building codes. By ensuring tenants' rights are greater than landlords' rights. By making decisions based on case law and common law.

By making decisions based on case law and common law.

Which type of pipe is typically found in drainage systems? Aluminum Cast iron Plastic Brass

Cast iron

Which record would show you who owned a property back in 1940? Title of Ownership Title Record Chain of Title Chain of Ownership

Chain of Title

The license law is known as Chapter 11 Chapter 339 Chapter 7 Chapter 12

Chapter 339

In which contract provision would the length of the lease be outlined? Statement of Limits Clear Statement of Term Clear Notice of Terms Order of Terms

Clear Statement of Term

On what form would you find information regarding itemized closing costs due to other parties, such as tax assessments, recording fees, and attorney's fees? Closing Disclosure form Loan Summary Mortgage Rate form Closing Fees form

Closing Disclosure form

Which of the following is considered a conventional loan? FHA insured VA guaranteed Commercial bank ARM loan FNMA mortgages

Commercial bank ARM loan

A broker took earnest money from a friend and deposited it in the broker's personal account. This is: misrepresentation commingling waste a felony

Commingling

What has replaced most dower and curtsey laws? Estate laws and non-estate laws. Community property laws and elective share laws. Eminent domain laws and freehold laws. County laws and civil laws.

Community property laws and elective share laws.

One business attracts another business of similar type, and together they may make more money than they would have singularly. This is an example of what principle of value? Contribution Competition Progression Assemblage

Competition

What is NOT a licensee's responsibility when complying with fair housing laws? Know the fair housing laws. Complete and record all HUD-96 marketing report forms. Keep accurate records. Periodically attend fair housing seminars.

Complete and record all HUD-96 marketing report forms.

Commercial real estate includes all of the following except which? Hotel Condominium Gas station Parking lot

Condominium

When an agency relationship is terminated, which of the following responsibilities still remains in force? Skill Confidentiality Obedience Care

Confidentiality

Which agency administers RESPA? Consumer Federal Protection Bureau (CFPB) Consumer Federal Consumer Board (CFCB) Consumer Financial Protection Bureau (CFPB) Consumer Financial Credit Bureau (CFCB)

Consumer Financial Protection Bureau (CFPB)

Which type of contract can have tax benefits for a seller? Option to buy Purchase and sale Contract for deed Lease

Contract for deed

Which of these guidelines is not part of the IRS safe harbor test? Income must be based on sales input. Contractors must have access to workers compensation benefits. The contractor must be licensed as a real estate salesperson or broker. There must be a written contract in place.

Contractors must have access to workers compensation benefits.

Which principle of value holds that the value of any component of a property is what it gives to the value of the whole or what its absence detracts from the whole? Substitution Conformity Contribution Progression

Contribution

What does risk management mean as it applies to property management? Controlling and limiting risk through proper insurance Limiting financial risk through the operating budget Overseeing preventive maintenance Keeping the grounds cleared to eliminate accident risk

Controlling and limiting risk through proper insurance

The lender is not insured or guaranteed against a loss, by reason of the borrower's default in repayment, under which type of loan? FHA Conventional VA GI

Conventional

Which of the following approaches to value figures the land separately from the value of the improvements? Functional Obsolescence. Income Approach. Cost Approach. Sales Comparison Approach.

Cost Approach.

A licensed broker may engage in all EXCEPT Assist buyers of real estate in obtaining information on various mortgage loans Create and write leases without the approval of legal council Give an opinion of value of a property for the purpose of obtaining a listing from a prospective client Collect rental payments for others

Create and write leases without the approval of legal council

A property's taxes are $9,540 and are paid for in arrears. The property was sold, and closing took place on March 7. The seller was responsible for the day of closing. Using the 360 day method, how will taxes be prorated? Credit the buyer $1775.50 and Debit the Seller $1775.50 Credit the seller $186 and debit the buyer $186. Credit the buyer $1,590 and debit the seller $1,590. Credit the buyer $1,675.50 and debit the seller $1,675.50.

Credit the buyer $1775.50 and Debit the Seller $1775.50

A property's real estate taxes are $1,000, and this amount is paid in arrears. The closing was on May 5th. How would the entry read on the closing statement? Assume the taxes remain the same, the seller owns the day of closing, and use the 360-day method. Credit the buyer $347.22, debit the seller $347.22 Debit the buyer $347.22, credit the seller $347.22 Credit the seller $342.47, debit the buyer $342.47 Debit the buyer $342.47, credit the seller $342.47

Credit the buyer $347.22, debit the seller $347.22

What document shows legal alienation of a property? Contract Deed Purchase Agreement Promise to Sell

Deed

Which document is the most important at closing? Settlement statement Deed Inspection reports Listing contract

Deed

Which document transfers property to the buyer? Abstract Sales Contract Purchase Order Deed

Deed

What form of limited agency is a good alternative to dual agency? Non-agency Undisclosed dual agency Designated agency Buyer brokerage

Designated agency

The principal of Notice is sometimes called what? Openness Honesty Disclosure Diligence

Disclosure

Which of these is not a helpful homeowner tip? Display lots of family photos to impress potential buyers De-clutter your garage and basement. Bake muffins or cinnamon rolls to create a "homey" feel. Make sure all light bulbs and lamps are working and are bright.

Display lots of family photos to impress potential buyers

To find the value of a property using the Income Approach to value, if the Net Operating Income and capitalization rate were known, the appraiser would: Multiply the Net Operating Income by the capitalization rate. Multiply the Effective Gross Income by the capitalization rate. Divide the Net Operating Income by the capitalization rate. Divide the capitalization rate by the Net Operating Income.

Divide the Net Operating Income by the capitalization rate.

What technique is frequently used to increase attendance when holding an agent's open house? Bonus commission points Drawing for incentives Home tour punch cards Compensation awards

Drawing for incentives

Which of the following is typically NOT a licensee's duty to the brokerage? Work to promote and sell the broker's listings. Be appropriately licensed. Remain knowledgeable about the license laws and rules. Establish compensation agreements with other ancillary service providers.

Establish compensation agreements with other ancillary service providers.

What is the term given to an agent who is acting as a buyer's and seller's agent in the same transaction? Co-agent Tri-agent Dual-agent Assigned agent

Dual-agent

Which clause protects a lender if he does not want the loan to be assumed by another party? Defeasance Subordination Due on sale (alienation) Subrogation

Due on sale (alienation)

Which of the following statements is TRUE? Earnest money must come from the party that signs the contract. Earnest money must be at least 10% of the contract price. Earnest money must be included with any contract to be valid. Earnest money is not required for a contract to be valid.

Earnest money is not required for a contract to be valid.

A development company owned property that the city wanted so it could extend the runways at the municipal airport. If the company refuses to negotiate with the city, then the city may acquire the property by: Escheat. Accretion. Confiscation. Eminent domain.

Eminent domain.

In what section on a seller's disclosure would you find information regarding issues in relation to drainage problems? Structural Systems and Fixtures Water Environmental

Environmental

Which component is not required in most listing agreements? Identification of the property Specifics of compensation defined Signatures collected Escrow company named

Escrow company named

Which of the following is a role of the federal government in real property rights? Establishment of broad standards of usage. Establishment of real estate license laws. Training and licensing of real estate agents. Levying of real estate taxes.

Establishment of broad standards of usage.

Which kind of lease has no time limit? Estate for years Estate at will Estate from period to period Estate at sufferance

Estate at will

Bob signs a six-month apartment lease agreement with John. What kind of lease is this? Tenancy at sufferance Estate from period to period Estate at will Estate for years

Estate for years

Jim signed a six months lease. What type of lease did Jim sign? Estate at will Estate for time Estate for years Estate at sovereignty

Estate for years

Which type of agreement assures that a broker will receive compensation regardless of who procures the buyer? Gross listing Net listing Exclusive right to sell Exclusive agency

Exclusive right to sell

How is the tax base of an area calculated? Exemptions are added to the sum of assessed values. The tax levy is subtracted from the budget shortfall. The millage rate is divided by the tax levy. Exemptions are subtracted from the sum of assessed values.

Exemptions are subtracted from the sum of assessed values.

If a buyer asks about homes in the "Muslim" area, what should you do? Explain to the buyer that you, ethically and legally, cannot recommend housing based on religion. Refer them to another licensee. Answer the buyer's question to the best of your abilities. Report the buyer to the Fair Housing Board.

Explain to the buyer that you, ethically and legally, cannot recommend housing based on religion.

If a buyer asks for the "Jewish" area, what do you do? Answer the buyer's question to the best of your abilities. Refer them to another realtor. Explain to the buyer that you, ethically and legally, cannot recommend housing based on religion. Report the buyer to HUD as a Fair Housing violator.

Explain to the buyer that you, ethically and legally, cannot recommend housing based on religion.

The depreciation most difficult to remedy would be: Physical. External Functional. Premise.

External

Which aspect of depreciation is almost always incurable? External obsolescence Physical deterioration Internal obsolescence Functional obsolescence

External obsolescence

Which of the following best defines negligent misrepresentation? Intentionally misrepresenting facts Providing false information as facts Failure to use ordinary or reasonable care in a situation Manipulation of facts to direct a favorable outcome

Failure to use ordinary or reasonable care in a situation

Which private organization has been under the Federal Government's conservatorship since 2008? Ginnie Mae Fannie Mae Sallie Mae FHA

Fannie Mae

Who is the largest purchaser in the secondary market? Ginnie Mae Fannie Mae FHA Freddie Mac

Fannie Mae

Which of the following is considered a part of the secondary mortgage market? Mutual Savings Bank Assoc. (MSBA) Federal Reserve Board (FED) American Credit Union Board (ACUB) Federal Home Loan Mortgage Corporation (FHLMC)

Federal Home Loan Mortgage Corporation (FHLMC)

Which is not an agency that deals (buys loans) in the secondary market? Government National Mortgage Association Federal Home Loan Mortgage Corporation Federal Housing Administration Federal National Mortgage Association

Federal Housing Administration

All of the following purchase mortgages from savings and loans in the secondary market EXCEPT the Government National Mortgage Association. Federal National Mortgage Association. Federal Home Loan Mortgage Corporation. Federal Housing Administration.

Federal Housing Administration.

Which of the following is not an item that a buyer usually pays at closing? Fee for clearing the title Mortgage recording fee Homeowner's insurance Title search

Fee for clearing the title

In what kind of estate does ownership revert to the grantor of the estate if usage fails to conform to a stated condition in the grant? Fee simple absolute Land Trust Life estate with a remainderman Fee simple defeasible

Fee simple defeasible

What is the primary directive given to a seller's agent? Provide support to cooperating agents. Find a ready, willing and able buyer. Deal in the best interest of the buyer. Provide opinions based on experience.

Find a ready, willing and able buyer.

Margaret King is a licensed salesperson. She is selling her property as a FOR SALE BY OWNER (FSBO). What must she disclose in her advertisement in the newspaper? For Sale-Call Margaret King 728-3434 For Sale-Call Big Realty, Margaret King 728-3434 For Sale-Owner For Sale-Owner-Salesperson

For Sale-Owner-Salesperson

All closing real estate sales must be reported to the IRS on which form? Estate Tax Form Hud-78 Form Form 1099 Form 1199

Form 1099

Which of the following payment arrangements are associated with a press release? Index payment schedule Same cost as a display ad Same cost as a classified ad Free advertisement

Free advertisement

Salesperson French presents a written offer for $189,000 to seller Dutch. The listed price is $200,000. Dutch reviews the offer and seeks further advice from her accountant. Salesperson French receives a second written offer, this one for $175,000. Which of the following is true about this situation? French must wait until Dutch accepts or rejects the first offer before he presents the second offer to Dutch. French must present the second offer promptly. French cannot present the second offer at any time because it is 90% lower than the list price. French must present the second offer as a backup contract.

French must present the second offer promptly.

If a broker changes his company address, he must Phone the MREC Notify the MREC by registered mail Give the MREC written notice within 10 days Give the MREC written notice within 30 days

Give the MREC written notice within 10 days

What does the management agreement create? Special agency Sole proprietorship General agency Power of attorney

General agency

Of the following types of deeds, which provides the grantee with the best assurance of title? Bargain and sale General warranty Special Quitclaim

General warranty

Which of the following is TRUE of a nuncupative will? It is in the testator's handwriting. Generally, it does not need to be signed in order to be valid. It is valid for the transfer of real property, even if it is not witnessed. Generally, it is not valid for the transfer of real property.

Generally, it is not valid for the transfer of real property.

Agent Sally has been with Black Realty for over three years and has worked up to the top agent in the firm. Her commission percentage rate is double that of a starting agent. Based on this information, what type of compensation plan does the Black agency have in place? Graduated Level Grade Ramped Step

Graduated

Which kind of lease increases at specified intervals? Graduated Gross Percentage Net

Graduated

If a licensee joins a company as an independent contractor, which of these will he probably have to pay for on his own? Health insurance Office space For Sale signs Errors and omissions insurance

Health insurance

Bill has informed his landlord that he will be moving in 30 days. What action has Bill taken regarding his lease requirement? He has provided an advance order of moving. He has given notice. He has given due process. He has given notice of vacating.

He has given notice.

Broker Carr has taken a listing from Seller Dole, what must he do? He must give him a copy of all documents at the time of signing. He may send him a copy the next business day. He must give him a copy within 3 business days. He must give him a copy at the time of signing only if requested by Seller Dole.

He must give him a copy of all documents at the time of signing.

Sally is a subagent working for Seller Pat. What does Sally owe to Buyer Brad? Honesty and fair dealing Confidentiality Advice on negotiations Information about Pat's motivation to sell

Honesty and fair dealing

Behavioral, Financial, and Type of Relationship are IRS verification levels of control and independence regarding contractor status. Title IX verification levels of payment. HUD levels of reimbursement. compensation levels due a contractor based on performance.

IRS verification levels of control and independence regarding contractor status.

If a single parent is applying for a real estate loan, when would the fact have to be revealed that part of the parent's income is from child support? When applying for a VA or FHA loan if the parent's income is less than $25,000 If more than 50% of the parent's income is non-wage sources If the parent was relying on the income for repayment of the loan This type of income never needs to be disclosed. It would be a violation of ECOA.

If the parent was relying on the income for repayment of the loan

How long does a salesperson have to deliver earnest money to the broker? Immediately 2 banking days 5 banking days 7 banking days

Immediately

When must a seller receive a copy of the listing agreement? After the broker's receptionist has had a chance to make copies Immediately after the agreement is signed by all parties Before the home is shown for the first time Anytime before an offer is presented

Immediately after the agreement is signed by all parties

Which of the following is not in violation of the CAN-SPAM Act? A deceptive subject line in a commercial e-mail. Misleading information as to the sender's identity. Including an opt-out method for the recipient. Failing to identify a commercial e-mail as such.

Including an opt-out method for the recipient.

Commercial income producing property is best appraised using which method? Market Data Approach. Cost Approach. Income Approach. Sales Comparison Approach.

Income Approach.

Jim holds a commercial lease. Last year his rent went up 4% based on a 4% increase in the wholesale price index. What type of lease does Jim have? Revolving Lease Wholesale Lease Index Lease Leading Indicator Lease

Index Lease

In a condominium ownership, who owns the individual condo units? The unit manager Individual owners The cooperative Third party mortgage holders

Individual owners

What is characteristic of the allodial system of ownership? The government owns the land. Individuals own land directly. Land ownership is between 2 or more parties. Individuals have only temporary use of land.

Individuals own land directly.

What property type comprises buildings used for light or heavy manufacturing? Strip Malls and Retail Shops Resorts and Hotels Industrial and Warehouse Transportation Hubs and Parking Lots

Industrial and Warehouse

Which of the following does a principal owe to his or her licensee? Information Access Accounting Performance

Information

Which of these controls would be used to prevent a neighboring lot owner from violating the recorded deed restrictions in a subdivision? Zoning. Injunction. Police power. Condemnation.

Injunction

Broker Jim always has a parade float in the annual Fall Holiday Parade. What form of advertisement is Broker Jim's float? Institutional Regional Services Product

Institutional

An increase in the availability of money would lead to which effect? Interest rates would go up. Interest rates would go down. Interest rates would NOT be affected due to RESPA guidelines. Interest rates would NOT be affected due to TRUTH IN LENDING.

Interest rates would go down.

In the event of the death or incapacity of a licensed broker, the MREC may Issue without examination or fee a temporary license to anyone the MREC wishes Appoint only a licensed person permission to become a temporary broker to wind up the transactions Allow the temporary broker to continue taking listings while winding up the affairs of the broker Allow for a temporary broker's license to be issued but only if the proper fee of $175.00 is paid

Issue without examination or fee a temporary license to anyone the MREC wishes

What is the purpose of an equalization factor in ad valorem taxation? It modifies a local tax rate to bring it into conformity with statutory tax rates. It changes the assessed value of an individual property to make it reflect the assessed values of other properties in the same neighborhood. It adjusts assessments in a locality to make them more consistent with an average level for the state or other higher-level jurisdiction. It adjusts the amount of the homestead exemption in a certain area to make it proportionally equivalent to the average homestead exemption in other areas.

It adjusts assessments in a locality to make them more consistent with an average level for the state or other higher-level jurisdiction.

What is a unique characteristic of a special assessment tax? More valuable properties which stand to benefit will pay proportionately more taxes. It applies only to properties which will benefit from the public improvement. The equalization board discounts levies for properties not affected by the public improvement. It creates an involuntary junior lien on the property.

It applies only to properties which will benefit from the public improvement.

What is the function of recording a deed? It makes the deed valid. It causes title to pass. It gives constructive notice of ownership. It removes all prior recorded encumbrances.

It gives constructive notice of ownership.

What purpose is served by recording a deed? It clears all encumbrances. It validates the deed. It transfers title. It gives constructive notice of ownership.

It gives constructive notice of ownership.

Which of the following is true about a net listing in Missouri? It may be in oral form only. It must be in writing according to the Statute of Frauds. It is the only type of listing allowable in Missouri that can be canceled without notice to the broker. It is illegal and prohibited in Missouri.

It is illegal and prohibited in Missouri.

Which of the following is true of a second mortgage? It has priority over a first mortgage. It cannot be used as a security instrument. It is not negotiable. It is usually issued at a higher rate of interest.

It is usually issued at a higher rate of interest.

Which statement about the Torrens system is FALSE? To enter a property in the Torrens system, a court action must first clear title. It is necessary to search public records to ascertain the status of title. The Torrens title record is the title itself. The Torrens registry retains the original registration documents and provides copies to the recorder or another appropriate office.

It is necessary to search public records to ascertain the status of title.

What is not a reason to understand Fair Housing Laws? It is right. It is the law. It is recommended. It reduces risk.

It is recommended.

Which of the following is required for a legal description to be adequate? It must be written by a licensed real estate attorney. It must accurately locate and identify the boundaries of the property and distinguish it from all other properties. It must be included in a survey of the property conducted by a licensed surveyor. It must accurately identify property boundaries and locate and describe all improvements on the property.

It must accurately locate and identify the boundaries of the property and distinguish it from all other properties.

A new broker is considering opening his office in his home. Which is true? He could only employ 2 salespersons. It must be open to the public during regular business hours or at regular stated intervals. A broker can never have his office in his home. He cannot have the office in his home unless it is separate from the living quarters.

It must be open to the public during regular business hours or at regular stated intervals.

When a joint tenant dies, what happens to the tenant's interest in the estate? It passes to the decedent's heirs, who become joint tenants. It passes as a tenancy in common to the decedent's heirs. The joint tenancy terminates and becomes a tenancy in common with the decedent's heirs and the surviving tenants as co-owners. It passes to the surviving joint tenants.

It passes to the surviving joint tenants.

What is the purpose of the Statute of Frauds? It invalidates certain oral contracts. It requires certain conveyance-related contracts to be in writing. It nullifies oral leases and listing agreements. It eliminates fraud in real estate contracts.

It requires certain conveyance-related contracts to be in writing.

How does Planned Unit Development zoning differ from ordinary zoning? It applies only to industrial and office parks. It incorporates a number of different zones within a single property boundary. It requires that multiple tracts of land be developed according to a single design for efficient use of space. It requires developers to obtain a separate building permit for every structure.

It requires that multiple tracts of land be developed according to a single design for efficient use of space.

James wants to make sure he is working with a licensed real estate broker when he is renting property. He asks to see the license of the agent and the broker with whom he is working. Which is true? James is nosey and does not need to see anything James is a member of the public and is entitled to see a license, or he may call the real estate commission and verify whether or not the individuals are licensed A real estate salesperson and/or broker should carry their licenses and display it upon request when involved in a real estate transaction Licensees are not required to tell the public that they are licensed

James is a member of the public and is entitled to see a license, or he may call the real estate commission and verify whether or not the individuals are licensed

John Grant, known to all as a man of integrity and honesty is 19 years old. Seven months ago, John finished and passed his salesperson examination. Why can John NOT receive a license? John lacks a high school diploma. John is less than the age 21. John did not apply for license within six months after finishing the salesperson's class. John did not apply for license within 60 days after passing the exam.

John did not apply for license within six months after finishing the salesperson's class.

Which of the following circumstances would concern you about working for Broker John? John offers weekly training seminars. There are several successful agents at John's office. John's office has a selection of books, CDs, and tapes for agent use. John expects his agents to spend 5 hours a week on unsupervised telephone duty.

John expects his agents to spend 5 hours a week on unsupervised telephone duty.

What is the best suggestion to give sellers when a showing is scheduled? Leave the property. Greet the agent at the door. Assist the agent with the showing. Move to a private area in the house and remain quiet.

Leave the property.

In an installment land contract, what type of title did the seller retain? Joint Legal Equitable Record

Legal

A homeowner wants to give a neighbor seasonal permission to cross her yard to reach a public basketball court. What kind of lien or encumbrance should she use? Encumbrance Easement License Covenant

License

Which of the following is an advantage of investing in a nonresidential property? No cost-of-living provisions Reduced payroll taxes No lease coverage for production interruptions c

Limited rent controls

A salesperson working as an independent contractor for a broker may: List and sell 10 houses a year Accept compensation from another broker Accept compensation directly from the owner Pay compensation directly to another salesperson that assisted with the sale

List and sell 10 houses a year

A corporation was entering the real estate business. It must be registered with: MREC HUD local county recorder the Board of Realtors

MREC

All of the following were originally established to buy and sell mortgages in order to stimulate mortgage lending, except Fannie Mae (FNMA). Maggie Mae (MGIC). Freddie Mac (FHLMC). Ginnie Mae (GNMA).

Maggie Mae (MGIC).

The Administrative Hearing Commission will Arbitrate commission disputes between salespersons and brokers Make a final ruling of the acts of a licensee regarding finding of facts and ruling of law Make decisions concerning the actual punishment of salespersons and brokers who have violated the rules and regulations Fine a salesperson or broker up to $10,000 for violation of MREC rules and regulations

Make a final ruling of the acts of a licensee regarding finding of facts and ruling of law

What can the VA require a veteran do when obtaining a loan? Make the down payment directly to the VA Make a down payment in cash Make the veteran automatically assume liability for the loan Not allow the veteran to make prepayments on that amount

Make the veteran automatically assume liability for the loan

Which of the following types of value is the type most often sought by an appraiser? Exchange Economic Market Replacement

Market

Martha signs a listing agreement with Broker Patrick. Which of the following would probably not be found in the agreement they signed? Patrick's commission Martha's price Expiration date of the contract Martha's average utilities

Martha's average utilities

What is the log that identifies all escrow bank account numbers and the name and address of the bank where the escrow accounts are located? Log of Accounts Accounts Receivable Escrow Log Earnest Money Log of Accounts Master Escrow Account Log

Master Escrow Account Log

What document is used to show the chronological sequence in which funds are received and disbursed by the sponsoring broker? Summary Account Ledger Journal Master Log

Master Log

A potential buyer asked a broker to show him/her where the property lines are located. The broker gave a partial metes and bounds description by stating that the boundaries ran from a stone wall to a stake even though he knew that his description was not necessarily accurate. When the buyer attempts to put up a fence his/her neighbors inform him/her of the correct property lines. The buyer May file a complaint based on misrepresentation to get the broker's license suspended or revoked May put up the fence anyway as the metes and bounds description takes precedence over the neighbor May do nothing as they could have had a survey May do nothing as the broker gave only a partial description

May file a complaint based on misrepresentation to get the broker's license suspended or revoked

A tire company has a manufacturing plant located in an area that has just been re-zoned for residential usage. The company is allowed to continue operating the plant under the new zoning classification. However, if the plant is destroyed by fire, the tire company: May not construct another plant in the neighborhood without first applying for a zoning variance. May not construct another plant in the neighborhood under any circumstances. May construct another plant if it obtains the consent of the residents living in the neighborhood. May construct another plant without the resident's consent as long as the homeowners' association approves it.

May not construct another plant in the neighborhood without first applying for a zoning variance.

What can you do to increase your chances of extending a listing that is about to expire? Call some friends and ask them to tour the property. Meet with your sellers a few weeks before the listing expiration and review with them your marketing efforts. Draw up an extension contract and mail it to the seller's two weeks before the listing expires. Meet with the sellers after the listing expires and write a new listing.

Meet with your sellers a few weeks before the listing expiration and review with them your marketing efforts.

Which of the following classes are not protected by federal law? Military status Sex Color Handicap

Military status

Which of the following is a common complaint that buyers have against brokers? Excessive paper work Compensation fees Misrepresentation of the facts Failure to respond to questions

Misrepresentation of the facts

What can a broker-salesperson who is a branch office manager for a large real estate company do? The office manager cannot continue to sell and list property because he/she would be in direct competition with the salespeople. As a principal broker, the office manager must manage. The office manager may not list or sell. Missouri law does not prohibit branch managers from listing or selling.

Missouri law does not prohibit branch managers from listing or selling.

A veteran had a VA loan using his full entitlement. He allows another veteran to assume the loan without VA approval. Could he immediately get another VA loan? Yes, because another veteran assumed the loan. Yes, because he is no longer liable for the loan. No, because he is still liable for the loan. No, as he can NOT use VA eligibility more than once.

No, because he is still liable for the loan.

How does a condominium association cover regular maintenance costs? Special levy Annual tax Monthly assessment Mortgage lien

Monthly assessment

Under an FHA graduated payment mortgage, which of the following fluctuates over the term of the loan? Interest rate Monthly payments Finance charge Annual rate

Monthly payments

How is a homeowner's total tax bill derived? Divide the tax requirement by the tax base. Divide tax dollars needed by the taxable assessed value. Multiply each district's tax rate times the taxable value of the owner's property. Average the tax rate for each tax district, and then multiply the average tax rate times the assessed value.

Multiply each district's tax rate times the taxable value of the owner's property.

A broker who had several offices went about once a week to each office to check them out. Since he had no other broker on staff, is this legal? Yes, as long as he saw each office at least once per week. Yes, as long as he was readily accessible by telephone. No, a broker can only manage two offices at one time. No, because he was not in direct control of the salespersons' actions.

No, because he was not in direct control of the salespersons' actions.

Who controls the internet site at www.realtor.com? Realtor Inc. National Association of REALTORS® Realtor Property Inc. Realtor Corp.

National Association of REALTORS®

Agent John just listed a home in a mid-range priced neighborhood. Which of these ad headlines would probably be the least effective for this home? Large Back Yard Three Bedrooms $125,000 Needs Paint

Needs Paint

A salesperson, licensed in another state (not in Missouri), is visiting St. Louis and helps her father sell his listed property. The agent finds a buyer through a local church group and successfully negotiates the sale of the St. Louis residence. The salesperson is entitled to which of the following considerations from the listing broker of her father's property? A finder's fee. The buyer's agency commission offered in MLS. The normal commission offered by the broker under the sub-agency clause of the listing contract signed by the agent's father. No commission is due to the agent because she is not licensed in MO.

No commission is due to the agent because she is not licensed in MO.

A broker lists a property, but fails to indicate an expiration date. When questioned about this by the owner, the broker states that the listing contract is for 180 days but that the property will be sold by then. Is this a legal listing agreement? Yes, as long as the broker sells it within 180 days as promised. Yes, as long as there is a commission determined at the listing interview. No, it is illegal because a listing cannot be for more than 90-days. No, it is illegal because there was no expiration date indicated.

No, it is illegal because there was no expiration date indicated.

A property owner in a recently zoned area was permitted to continue to use his property in a manner that did not comply with the zoning requirements. This use is described as which of the following? Exclusive-use zoning. Deviation. Nonconforming use. Private control of land use.

Nonconforming use.

A unlicensed secretary employed by a broker in a residential sales office may Take property listings by telephone but may not go to the client's home to take a listing Show a listed property to a prospective buyer if the secretary does not claim to be a salesperson or broker salesperson Not solicit or accept listings or show listed properties Do anything a licensed salesperson can do as long as the broker supervises the activities

Not solicit or accept listings or show listed properties

Salesperson Dole took an offer to a seller and the seller looked it over for an hour and then signed it. What should the salesperson do at the time of final acceptance? Notify the seller that final acceptance was obtained Note the date the buyer made the offer Note the date it was presented to the seller Note that all signatures and initials of the parties are present in the contract

Note that all signatures and initials of the parties are present in the contract

Disclosure is sometimes called what? Openness Honesty Notice Diligence

Notice

A buyer assumes the mortgage. How is the owner relieved of the liability? Subject to mortgage Novation Substitution Graduation

Novation

All of these items are important to include in your weekly activity report except which? Number of calls that week Agent comments about the property Classified ads placed on the property Number of hits on the company website

Number of hits on the company website

Which of the following is NOT a necessary condition for claiming title by adverse possession? Occupy the property without concealment Occupy an unpermitted structure on the property Occupy the property without permission Occupy the property for a statutory period

Occupy an unpermitted structure on the property

Under what type of contract is a seller obligated to sell, but the buyer is not obligated to buy? Lease Recission Option Purchase

Option

A licensee tells a neighborhood watch group that Vietnamese are moving into the neighborhood. What is this broker guilty of? Redlining Typecasting Steering Panic selling

Panic selling

Which of the following actions is an expression of the public interest known as police power? Enforcing of parking regulations on residential streets Passage of zoning ordinances to control land use Leasing of office space for government use Collection of sales tax on purchases of consumer goods

Passage of zoning ordinances to control land use

A salesperson did not renew his/her license, or take twelve (12) hours of continuing education. Three (3) months later, he/she decides to renew. What must a salesperson do to renew a license under these circumstances? Pay the fee and take the continuing education courses. Pay the fee and take the 48-hour prelicensing course. Pay the fee and take the 24-hour Missouri practices course. Take the 48-hour prelicensing course, take and pass the state examination and apply as an original applicant.

Pay the fee and take the 24-hour Missouri practices course.

RESPA would prohibit which of the following acts? Steering Paying of kickbacks Blockbusting Redlining

Paying of kickbacks

How is a lien terminated? Payment of the debt that is the subject of the lien and recording of the satisfaction Transfer of the property that has the lien Recording of another lien that is superior Death of the lienor or lienee

Payment of the debt that is the subject of the lien and recording of the satisfaction

Landlord Frank terminated Jerry's lease because gross sales did not meet expectations. Jerry agreed to what type of lease? Retail Level Lease Percentage Lease Reorder Lease Market Level Lease

Percentage Lease

What is the primary criterion for determining whether an item is real or personal property? Cost of the item in relation to the cost of the main item of property. Permanent (or otherwise) attachment to the land. Size of the item. Documentation of how the item was acquired.

Permanent (or otherwise) attachment to the land.

A developer put two lots together and sold them as one large lot. The increase in value is referred to as: Appreciation. Contribution. Plottage. Partition.

Plottage

Public land use controls in the form of building ordinances are an exercise in the form of: Eminent domain. Police power. Interstate land sales. Deed restrictions.

Police power.

Functional obsolescence is due to: Normal wear and tear. Poor design or floor plan. Poor location. An adjacent, adverse property use.

Poor design or floor plan.

What kind of clause in a mortgage or trust deed enables a non-judicial foreclosure to occur? Power of attorney Power of sale Due on sale Damages

Power of sale

On the Closure Disclosure form, homeowner's insurance and property taxes are classified as what? Prepaids Paid Forward Advanced Payments Payments in Arrears

Prepaids

Which function is not performed by a property manager? Renting property Leasing property Keeping costs within budget Preparing the property deed

Preparing the property deed

What are the two changes most often made to a listing agreement? Compensation changes and property condition additions Escrow money requirements and move-in dates Price changes and listing period extensions Personal property removal and tax rate changes

Price changes and listing period extensions

A CMA is performed when: Accessing property. Pricing property. Taxing property. Condemning property.

Pricing property.

A Budget Mortgage is a loan, which has a payment composed of the following? Principal and interest only Principal, interest, taxes and insurance Interest only Principal and compound interest

Principal, interest, taxes and insurance

The CAN-SPAM Act requires all of the following EXCEPT: A valid physical address in all commercial e-mails. Identification of the party who initiated the e-mail. Prior permission of the recipient to send commercial e-mails. An opt-out method for the recipient to unsubscribe.

Prior permission of the recipient to send commercial e-mails.

Broker Barb takes out a two-page color full-page ad in the weekend paper of her listed properties. What form of advertisement is this? Service Institutional Product Batch

Product

A $175,000 house was built next to a $75,000 house. Which of the following principles of value would apply? Substitution. Competition. Progression and Regression. Anticipation.

Progression and Regression.

What is another term give to a property flyer? Property notes Cheat Sheets House Bios Property Briefs

Property Briefs

A licensed agent acting as a property manager deposits current rental money received into a Property management escrow account Business account Management account Security deposit escrow account

Property management escrow account

What kind of lease conveys a leasehold interest to an owner of a cooperative? Net-net Proprietary Percentage Index

Proprietary

Which of the following strategies would require a business to outlay the most amount of capital for building space? Purchasing a building Renting a building Leasing a building Rent with option to buy

Purchasing a building

Which method of determining cost adds estimates of material and labor costs to indirect costs to arrive at the total cost of a structure? Chapter in place Square foot cost Reproduction cost Quantity survey

Quantity survey

If a Veteran wanted to buy a $60,000 house in a city with a population of 100,000 people, which of the following loans could he NOT apply for? VA loan FHA loan RECD loan Conventional loan

RECD loan

One way for an appraiser to account for a property's deterioration is to Increase the chronological age of the property. Decrease the chronological age of the property. Raise the effective age of the property. Decrease the effective age of the property.

Raise the effective age of the property.

The finance charges recorded on the Truth in Lending statements would include all of the following EXCEPT: Loan fees charged by the lender Insurance premiums for mortgage insurance payment Discount points and service fees Recording fees and title insurance premiums

Recording fees and title insurance premiums

If you are turned down for a license, what would be your most reasonable course of action? Request a hearing before the MREC (Missouri Real Estate Commission). Request an investigation by the attorney general. Request a hearing before the local Board of Realtors. Request a hearing before the AHC (Administrative Hearing Commission).

Request a hearing before the AHC (Administrative Hearing Commission).

Agent Sam gets about 6 hours of floor time each week. What is a major duty for Agent Sam during this time? File office documents from previous transactions. Assist other agents. Prepare mailings. Respond to incoming sales calls.

Respond to incoming sales calls.

A shopping center would be primarily categorized as what type of property? Recreational Office Investment Retail

Retail

What is the term given to those items that are attached to a yard sign that provide additional information to the passers-by? Flags Rider Strips Cookies Stripes

Rider Strips

What type of insulation is used for work on flat roofs, on basement walls, as perimeter insulation at concrete slab edges, and in cathedral ceilings? Rigid board insulation Spray foam insulation Batt and blanket insulation Reflective insulation

Rigid board insulation

What are the two most common forms of compensation that brokers use? Salary draw or escrow draw Kickback payments and direct deposits Hourly and flat rates Salary or a percentage of the commission

Salary or a percentage of the commission

In which of the following markets may a lender sell a loan that a mortgage banker has previously originated? Primary market Secondary market Mortgage market Consumer market

Secondary market

Ronald defaulted on his home mortgage loan payments; therefore, the lender obtained a court order to foreclose on the property. At the foreclosure sale, Ronald's house sold for only $29,000 and the unpaid balance of his loan is $40,000. What must the lender do to recover the $11,000 Ronald still owes? Sue for damages Sue for specific performance Seek a judgment by default Seek a deficiency judgment

Seek a deficiency judgment

RESPA applies to all of the following EXCEPT which? Condominium purchase Seller-financed loan Loan involving a second mortgage Federally-insured loan

Seller-financed loan

Which transaction requires a securities' license? Leasing a commercial building Selling a commercial warehouse Selling shares in Fannie Mae Arranging a sale-leaseback on a commercial property

Selling shares in Fannie Mae

Any licensee doing business under any name other than the exact name shown on his/her license Shall furnish the commission a copy of the registration of the fictitious name as submitted to the Secretary of State Will not be issued a license under any circumstances Will only need to register with the secretary of state Will be fined $10,000 by the MREC and the AHC

Shall furnish the commission a copy of the registration of the fictitious name as submitted to the Secretary of State

Which of the following is NOT a discriminatory activity? Telling persons that a property is not for sale or rent when it is Showing only properties that are within a buyer's financial range Using discriminatory advertising Stating that the property is restricted

Showing only properties that are within a buyer's financial range

In a repayment of a mortgage loan, which type of interest is used? Simple Discount Compound Floating

Simple

The interest on a real estate mortgage loan is what type of interest? Compound Discounted Amortized Simple

Simple

If a licensee joins a company as an independent contractor, which of these will he probably have to pay for on his own? MLS Fees Social Security Tax Advertisement Expenses Utility Expenses

Social Security Tax

When a home is listed, what is the most limited agency that can be created? Agency coupled with an interest General agency Special agency Universal agency

Special agency

What type of budget is used to forecast income and expense over some period of years? Operating Variable Capital Reserve Stabilized

Stabilized

Agent Norm just started working for Sunshine Realty. He was required to pay an initial fee of $120 for a phone and $50 for desk space. The $170 is usually referred to as what? Allowance Fee Working Costs Attendance Fees Start up costs

Start up costs

In most states, by paying the debt after a foreclosure sale, the mortgagor has the right to regain the property. What is this right called? Equitable right of redemption Owner's right of redemption Vendee's right of redemption Statutory right of redemption

Statutory right of redemption

A type of payment plan where a buyer pays interest only, and the final payment is principal at the end of the loan period. Straight Graduated Adjustable Amortized

Straight

Which type of foreclosure involves a court-ordered transfer of the mortgaged property to the lender? Non-judicial Strict Peremptory Judicial

Strict

In wood framing, what are the members called that frame the structure? Studs Beams Joists Rafters

Studs

The MREC received a formal, written complaint about Broker Grant's business conduct and intends to investigate the matter. In order to hold a hearing to decide the validity of the complaint, the MREC, may do which of the following? Subpoena Broker Grant to appear and give testimony. Subpoena any person in or outside the state of Missouri to produce records or other documentation which might have a bearing on the validity of the complaint in question. Close the broker's business until the issue is resolved. The MREC does not investigate -- only the AHC investigates.

Subpoena Broker Grant to appear and give testimony.

The market data approach relies on which of the following principles of value? Conformity Change Anticipation Substitution

Substitution

The premise of the Sales Comparison Approach rests on the principle of: Conformity. Competition. Highest and best use. Substitution.

Substitution.

Effective October 1, 2015, the real estate industry has new requirements as specified in the HUD-1A Rules. TILT/RESPA Loan Disclosure (TRLD) Rule. Consumer Protection Rules (CPR). TILA/RESPA Integrated Disclosure (TRID) Rule.

TILA/RESPA Integrated Disclosure (TRID) Rule.

Which of the following type of advertisement reach the greatest number of people? Newspaper ads Flyers Business Cards TV ads

TV ads

What are persons called who act as buyers and check on fair housing compliance? Fair housing guides Compliance officers Block watchers Testers

Testers

What are persons called who pose as customers to check on fair housing compliance? Block watchers Testers Compliance officers Civil rights workers

Testers

The right to exert public land use control is primarily authorized by which of the following? A grantor's written and recorded deed provisions. A municipality's self-legislated police power The 14th Amendment to the Constitution The constitution of individual states.

The 14th Amendment to the Constitution

Which land description method employs a subdivision plat map? The Lot and Block system The Rectangular Survey System The Metes and Bounds system The Government Survey system

The Lot and Block system

A buyer was told, by a licensed agent, that the second-story window air conditioner would remain with the house if the buyer paid the asking price. The salesperson had not confirmed this with the seller, and the seller removed the unit before closing. The buyer paid the full price for the house then discovered the unit missing and contacted the MREC to file a complaint. Which of the following statements is correct? The MREC will require the broker to buy an air conditioner for the buyers. The MREC may suspend the salesperson's license for making a misrepresentation. The MREC can only levy a fine against the salesperson equal to the cost of a new air conditioner. The MREC has no power or authority to take action.

The MREC may suspend the salesperson's license for making a misrepresentation.

Which party holds the escrow money when a dispute occurs? Title Company Court Appointed Escrow Agent The Sponsoring Broker Mortgage Lender

The Sponsoring Broker

Upon renewal of his license, a broker must disclose certain information concerning his branch office to the MREC, which would include The name of the office only The address of the branch office and the name of the licensee in charge of that office The name and address of all licensees Only the name of the licensee in charge

The address of the branch office and the name of the licensee in charge of that office

The concept of economic life is best characterized as The actual age of a structure or structural component. The effective age of a structure or structural component. The anticipated period of time an improvement will last for depreciation purposes. The anticipated physical life of an improvement as a function of its durability.

The anticipated period of time an improvement will last for depreciation purposes.

What are ad valorem taxes based on? The replacement value of property The assessed value of property The millage value of property The broker's estimate of value

The assessed value of property

Who is responsible for ensuring that all agents in a brokerage are properly licensed? The broker The real estate licensee board MLS licensee board State Board of Professional Licensing

The broker

A buyer has signed a contract to purchase a property but is uncertain of the condition of the title. Who is legally responsible for knowing the condition of the title? The County Recorder The seller's agent The buyer The mortgage lender

The buyer

If several residents of a cooperative apartment building default on their rent, causing the foreclosure proceedings against the cooperative, which of the following would be TRUE? Only the residents with rent in arrears would be affected because they will be evicted. The corporation owning the property would be dissolved and all of the residents could lose their interest in the cooperative. Foreclosure proceedings would be initiated against each resident by the lender. Only the cooperative's board of directors would be liable for the mortgage debt.

The corporation owning the property would be dissolved and all of the residents could lose their interest in the cooperative.

What date is used to establish lien priority for a mechanic's lien? The date of recording the lien The date of contracting between the mechanic and the lienee. The date of beginning or ending the mechanic's work, per state law The date the lienee borrows money to pay the debt

The date of beginning or ending the mechanic's work, per state law

Salesperson Link brings an offer to the seller of a listed property. After considering the offer for an hour, the seller accepts and signs the offer without changing any of the terms presented. Link then presents the buyer with a copy of the accepted contract. Which of the following must be included in this contract for sale? The date the property was shown to the buyer. The date the buyer signed the offer and instructed Link to present it to the seller. The date the offer was presented to the seller. The date of final agreement between the parties.

The date of final agreement between the parties.

The cost of doing direct mail advertising depends on all of these things except which? How you target your audience The frequency of the mailings The number of pieces you send The date of the mailing

The date of the mailing

Who creates the cooperative association that buys a cooperative property? The local cooperative board of regulation. The lending institution financing the development. The prospective tenants. The developer.

The developer.

What process determines how much money the buyer needs to bring to closing? The escrow agent will subtract the total of the buyer's credits from the total debits and the result is what the buyer needs to bring. The buyer brings an open bank draft and finds out the final amount at the closing meeting. The broker finds out from HUD and tells the buyer how much to bring. The lender calculates what's owed and tells the buyer what to bring.

The escrow agent will subtract the total of the buyer's credits from the total debits and the result is what the buyer needs to bring.

How does the buyer know how much money to bring to closing? The lender calculates what's owed and tells the buyer what to bring. The buyer brings a blank check and finds out the final amount at the closing meeting. The broker finds out from the lender and tells the buyer how much to bring. The escrow agent will subtract the total of the buyer's credits from the total debits, and the result is what the buyer needs to bring.

The escrow agent will subtract the total of the buyer's credits from the total debits, and the result is what the buyer needs to bring.

Where do the overall guidelines for zoning, building codes, and development requirements in a jurisdiction come from? The jurisdiction's master plan The jurisdiction's economic development committee State enabling acts State court decisions

The jurisdiction's master plan

Of the following parties to a mortgage, whose interest is benefitted by an acceleration clause? The mortgagor The mortgagee The trustee The trustor

The mortgagee

A salesperson is transferring to a new broker. What must be done before he/she can list or sell real estate? A salesperson must give his/her license to his/her broker to send to the MREC. Have the old broker call the new broker and set a date when the salesperson can start work. The new broker must obtain the salesperson's work permit from the MREC. No action is necessary to continue to list and/or sell real estate.

The new broker must obtain the salesperson's work permit from the MREC.

Agent Paul is bound to inform his client of all facts that might affect the client's interests - both what Paul knows and what he "should have known." Which of these situations would not be something Paul "should know?" There is a crack in the basement wall. The air conditioner does not work. The owner of the property is HIV positive. The casement windows have broken seals.

The owner of the property is HIV positive.

What is an ad valorem tax levy? The total of the assessed values of all real properties within a taxing jurisdiction The sum of all the taxes a local taxing jurisdiction collects in a tax year The part of a taxing body's budgeted expenses that must come from real property taxes The number of dollars per thousand dollars of assessed value that a real property owner must pay in property taxes

The part of a taxing body's budgeted expenses that must come from real property taxes

An appraiser deducts $5,000 for a property that has defective wiring. This defect is curable obsolescence, provided that The repair costs $4,000 to complete. The repair costs $6,000 to complete. The defect can be repaired at all. This defect is inherently incurable due to external obsolescence.

The repair costs $4,000 to complete.

Which person is responsible for filling out a property disclosure statement? Broker's office assistant The cooperating agent The sellers The listing agent

The sellers

At what level of government is the real estate business primarily regulated? The U.S. Constitution The federal court system The U.S. Congress The state legislature

The state legislature

Which of the following types of transactions typically contain a property disclosure? The transfer of a deed based on an open market sale of a residential property A transfer made by the personal representative of the estate of the decedent or by a trustee in bankruptcy A transfer in which the buyer has expressly waived the receipt of the property disclosure statement A gift or other transfer to a parent, spouse, domestic partner, or child of a transferor or child of any parent, spouse, or domestic partner of a transferor

The transfer of a deed based on an open market sale of a residential property

What is the result of a break in the chain of title to a property? A quitclaim deed is issued. Title escheats to the state. Title reverts to the last owner before the break. There is a cloud on the title.

There is a cloud on the title.

What does the salesperson have to disclose? There was a previous/recent fire in the house. The house was not fumigated. The owner is getting a divorce. There is a septic system.

There is a septic system.

Which of the following is true of easements in general? They involve the property that contains the easement and a non-owning party. They apply to a whole property, not to any specific portion of the property. They cannot be assigned or transferred. They may require a specific use, but cannot prohibit one.

They involve the property that contains the easement and a non-owning party.

Matt Bower is a developer. Will Jones is a builder. Matt agrees to sell Will a lot, but he conditions the sale by insisting that Will agrees to list the property with him after the home is built. What is this called? Market allocation Price fixing Coercion Tie-in arrangement

Tie-in arrangement

Why would a mortgagee (beneficiary) have an appraisal on the property? To make sure the buyer did not pay too much To determine the property's potential for appreciation To protect the buyer from fraud To assure the property value is sufficient to cover the loan

To assure the property value is sufficient to cover the loan

A partition suit is used for which of the following? Determination of party fences To allow the construction of party walls To force a division of property without all the owner's consent To change a tenancy by the entireties to some other form of ownership

To force a division of property without all the owner's consent

Why would a property owner file a quiet title suit? To force the grantor to defend the title against a third party claim To terminate a co-ownership estate when one co-owner is unwilling To keep the owner's name out of the title records To have an encumbrance removed if the lien holder cannot prove its validity

To have an encumbrance removed if the lien holder cannot prove its validity

Why do taxing entities sometimes use an equalization process when assessing properties? To level out the unevenness of valuations from one area to another To tailor millage rates to a wide range of assessed values within the taxing district To make tax rates equal across all jurisdictions To make all tax bills equal within the taxing district

To level out the unevenness of valuations from one area to another

What is the purpose of a homestead tax exemption? To exempt qualified property owners from ad valorem taxation To offer some amount of tax relief on an owner's principal residence To encourage multiple property investment To exempt owners of principal residences who rent their properties

To offer some amount of tax relief on an owner's principal residence

What is the purpose of Planned Unit Development zoning? To regulate the placement of industrial and office parks To combine multiple zoning categories within a single property boundary To enable a single building permit to cover every structure in a subdivision To promote an efficient land use design that maximizes open space when whole tracts are developed

To promote an efficient land use design that maximizes open space when whole tracts are developed

Which of the following would NOT count for continuing education credit in Missouri? A course concerning updates of Chapter 339 A course all about the Fair Housing Laws Training in business skills such as typing, personal motivation, salesmanship, sales psychology, or time management A review of contract and agency law (Law of Agency)

Training in business skills such as typing, personal motivation, salesmanship, sales psychology, or time management

In what section of the Closing Disclosure would you find the names and addresses for both the borrowers and sellers and the lender's name? Address Section Loan Information Closing Information Transaction Information

Transaction Information

What is the best strategy to use when dealing with a tester? Treat the tester as any other buyer. Hand-off the tester to your broker. Direct the tester to another real estate company. Refuse to work with a tester.

Treat the tester as any other buyer.

A salesperson associated with Rainbow Realty decides to purchase one of the company's listed properties and submits an offer to purchase. The agent did not disclose to the seller that she/he is an agent with Rainbow Realty. This agent may be charged with which of the following license law violations? Undisclosed Dual Contracts Undisclosed Dual Listings Undisclosed Dual Agency Undisclosed Commingling

Undisclosed Dual Agency

Which form of agency is illegal in most states Single agency Buyer's agency Undisclosed dual agency Subagency

Undisclosed dual agency

In which provision would a landlord describe what activities can take place on the property? Use of the Premises Property Order Location Use Property Regulations

Use of the Premises

An appraiser, using the Cost Approach method would do which of the following? Make an adjustment if the economic conditions have changed between the date of sale and the date of the appraisal. Use comparable properties as the basis for the decision. Use replacement cost minus depreciation. Use the ability of the property to produce income as the basis of the decision.

Use replacement cost minus depreciation.

Which of the following is considered a variable expense? Real estate taxes Insurance Advertising Utilities

Utilities

A permitted deviation from the standards of a building ordinance is called: Unlawful non-conforming use. Variance. Legal nonconforming use. Testimonial.

Variance

All of these statements are true except which one? Virtual tours are an expensive marketing tool to use. An agent should print off a copy of the listing on the company's internet site to send to the sellers. Participation in the MLS increases a licensee's inventory. Property evaluations from other agents have valuable information for sellers.

Virtual tours are an expensive marketing tool to use.

A mortgage company made a number of loans to be assembled into one package and sold to permanent investors. This process is an example of interim financing to the mortgage company and is called: Blanket financing Packing financing Warehousing Discounting

Warehousing

An owner was selling his own home. Can he advertise the down payment? No, because it violates RESPA No, because it violates Regulation Z Yes, as long as it was listed with a broker Yes, because it was his own home

Yes, because it was his own home

What is the principal mechanism for implementing a master plan? Zoning Referendum Public election Property management

Zoning

A broker can enter into a single agency agreement with seller and secondary principal. a renter and landlord. a buyer. a seller and buyer.

a buyer.

Which of the following would require a real estate license? an attorney transferring property for a client an auctioneer employed by the owner a property manager employed by a broker to only show apartments a person who negotiates or helps consumers consummate option to buy or sell real estate

a person who negotiates or helps consumers consummate option to buy or sell real estate

Which would require a license? an attorney transferring real estate for a client an auctioneer employed by an owner a property manager actively leasing and selling for a real estate company an owner transferring his own property

a property manager actively leasing and selling for a real estate company

A disclosure to the buyer from a subagent working as a seller's agent must include all the following EXCEPT a statement that the agent is acting on behalf of the seller the source of the commission that is to be made a statement that any information given to the subagent may be disclosed to the seller a statement that the seller is facing bankruptcy

a statement that the seller is facing bankruptcy

A taxpayer may redeem a foreclosed property after a tax sale if there is an in rem proceeding. a homestead exemption. an equitable right of redemption. a statutory right of redemption.

a statutory right of redemption.

Broker Carr has a 90 day listing on a property. One month after the listing had begun, Broker Dole contacted the seller and told him that he had a buyer moving in one month after the listing terminates and ask the seller to sign an agreement to take effect after the listing expires. This is: misrepresentation a violation of state real estate law allowable since the listing would have expired considered commingling of listings

a violation of state real estate law

Earnest money is usually made in the form of a holding draft. check. letter of credit. cash deposit.

check

The clause in a trust deed or mortgage which permits the mortgagee to declare the entire unpaid sum due upon a default by a mortgagor is called a(n) ______________ judgment clause. acceleration clause. escalator clause. forfeiture clause.

acceleration clause.

The first step in a judicial foreclosure is acceleration of the loan. filing a suit. obtaining a lis pendens. obtaining a writ of execution.

acceleration of the loan.

If a seller is looking for a non-minority home buyer, you should take the listing and note the restriction on the listing contract. take the listing and not show the property to minority buyers. not take the listing and note the reason in an MLS announcement. advise the seller of his legal and contractual obligation not to discriminate.

advise the seller of his legal and contractual obligation not to discriminate.

Which is true when a corporation receives a broker's license? all brokers licensed under the corporation must be officers of the corporation all corporate officers involved in the brokerage business must have active broker-officer licenses or a salesperson's license, but the salesperson cannot participate in the supervision of the office all corporate officers must have active salesperson licenses when the license is issued to the corporation, the individual officers will no longer require individual licenses

all corporate officers involved in the brokerage business must have active broker-officer licenses or a salesperson's license, but the salesperson cannot participate in the supervision of the office

The system of ownership that allows individuals to own property is called feudal. constitutional. democratic. allodial.

allodial

A mortgage where the interest rate fluctuates and is usually tied to an index; payment amount increases are capped for each period and for the term of the loan is called a Reverse Annuity Mortgage (RAM). a wraparound mortgage. a participation mortgage. an Adjustable-rate Loan (sometimes called an ARM).

an Adjustable-rate Loan (sometimes called an ARM).

A road easement is an example of a lien. a permit. a land order. an encumbrance.

an encumbrance.

A utility right-of-way is an example of an encroachment. a lien. an encumbrance. a permit.

an encumbrance.

An interest in real estate that does not include the right to possess is considered a leasehold interest. a fee simple estate. an encumbrance. a tenancy.

an encumbrance.

If a tenant occupies a leased property without the consent of the landlord after a lease expires, the type of estate that results is called an estate at sufferance. a holdover estate. an adverse leasehold. a hostile leasehold.

an estate at sufferance.

Ownership of some combination of the bundle of rights defines an undivided interest. an interest in real estate. an estate in land. a private interest.

an interest in real estate.

An encroachment is an easement that has not been recorded on the title of the burdened property. an unauthorized physical intrusion of one property into another. a right granted by a property owner to the owner of an adjoining property to build a structure that protrudes across the property boundary. a structure that does not comply with a zoning ordinance.

an unauthorized physical intrusion of one property into another.

A buyer wants to take out an FHA loan. The broker should refer the buyer directly to ______________ any approved lending institution such as a bank or savings and loan association. an FHA appraiser in the area. the Federal Housing Administration office. the Federal National Mortgage Association.

any approved lending institution such as a bank or savings and loan association.

To own an interest in real estate, a person must own any combination of the bundle of rights. the right to use the real estate. legal title to the real estate. the complete bill of rights.

any combination of the bundle of rights.

The MREC, believing an unlicensed person has violated the law, may file a complaint in: only the U.S. District Court only the appeals court only the court in the county where the act was committed any court of competent jurisdiction

any court of competent jurisdiction

A deed in lieu of foreclosure changes the loan terms. wipes out all liens. increases the costs of foreclosure. avoids public notice of a foreclosure.

avoids public notice of a foreclosure.

If an unlicensed person sells real estate for a fee, or accepts a referral fee for a real estate transaction, the MREC: a- May file a restraining order but has no other remedies against unlicensed individuals. b- May file a restraining order and assess a civil penalty of up to $2,500 per occurrence (based on the finding of the Missouri Administrative Hearing Commissioner (MAHC). c- May file a restraining order and assess a fine of $5,000 payable to the MREC. d- May require the individual to take a course on real estate law.

b- May file a restraining order and assess a civil penalty of up to $2,500 per occurrence (based on the finding of the Missouri Administrative Hearing Commissioner (MAHC).

Testing for fair housing compliance must be reported by the victims to the Real Estate commission. be treated with indifference. be recognized as a risk and a cost of doing business. be ignored.

be recognized as a risk and a cost of doing business.

Walls that support the ceiling and the roof are called non-bearing walls. bearing walls. eaves. headers.

bearing walls.

Panic selling is also known as blockbusting. streetbusting. marketbusting. localbusting.

blockbusting

A form of zoning which regulates density is referred to as bulk zoning. aesthetic zoning. directive zoning. subdivision regulation.

bulk zoning.

A licensed salesperson wants to include her home phone number on a sign that she placed on one of her listed properties. The sign must also include her broker's business telephone number beeper number home phone number business address

business telephone number

Prior to closing, a final walkthrough of the property should be performed to ensure that everything has remained as stated in the sales contract. The walkthrough is generally completed by the appraiser. lender. seller. buyer.

buyer

A property's rent roll is an alphabetical listing of each tenant. can help determine the annual rental income for a property. is a master list of a property's marketing plan. should be updated every 10 years.

can help determine the annual rental income for a property.

Dual agency creates two principals. is illegal in most states. establishes clear lines of fiduciary responsibilities removes all fiduciary responsibly from the licensee.

creates two principals.

Work agreements must be renewed each month. dated and signed by the parties. notarized. on file with the State

dated and signed by the parties.

Functional and external obsolescence are aspects of depreciation. effective age. land value. ability to generate income.

depreciation

A metes and bounds description must describe the parcel's boundaries as a complete, closed perimeter. conform to the standards set for the plat of survey. use rods and acres to quantify linear and area measurements. contain a distinct point of beginning and point of ending.

describe the parcel's boundaries as a complete, closed perimeter.

The property transferred by a will is called the devise. demise. device. assigns.

devise

Zoning ordinances are primarily intended to prevent urban development from encroaching on rural areas establish how every parcel in the zoning authority's area of control can be used. regulate subdivision expansion. buffer residential and industrial uses.

establish how every parcel in the zoning authority's area of control can be used.

Most apartment leases are estates at will. freehold estates. estate at sufferance. estates from period to period.

estates from period to period.

The Unit-in-Place method of estimating costs is best described as estimating costs per square foot. estimating costs on an item-by-item basis. estimating costs of installation. estimating costs of labor units.

estimating costs of installation.

In calculating the tax base of an area, exemptions are added to assessed values. exemptions are subtracted from assessed values. the tax levy is added to the budget shortfall. the millage rate is multiplied by the tax levy.

exemptions are subtracted from assessed values.

Time-share "ownership" is illegal in most states. fee or leasehold ownership. a form of tenancy by the entireties. not an estate.

fee or leasehold ownership.

Included in the definition of "real estate" are a mobile home parked temporarily on a rented lot. fences and roads on a parcel of land. trees cut down and lying on a parcel of land. business equipment installed by a tenant on leased property.

fences and roads on a parcel of land.

When thinking about tenant retention and owner profits, a property manager should be more concerned with retaining tenants to keep a property fully occupied. give tenants the most benefits possible while still ensuring a good return to the owner. limit benefits to tenants as much as possible to maximize owner profits. only be concerned with the profit they are returning to an owner.

give tenants the most benefits possible while still ensuring a good return to the owner.

A broker-salesperson acting as a sales manager cannot: act as a sales manager and supervisor at a branch office act as a salesperson working under a broker hold all the licenses of the salespeople working under him/her sell and list property

hold all the licenses of the salespeople working under him/her

Deed restrictions generally concern the form of ownership in which a property may be held. how long a property must be owned before it can be legally transferred. what groups of people are legally excluded from future ownership of a property. how a property may be used and what structures may be built on it.

how a property may be used and what structures may be built on it.

Two brokers are applying for a broker's license as a partnership. One of the two had been found guilty of embezzlement but has made full restitution. Which of the following is true? if the license is denied, they should contact the MAHC for a hearing one broker couldn't get the partnership licenses as long as she was a business associate of the other the MREC may never issue the license the brokers may apply to the MREC for a hearing if the license is denied

if the license is denied, they should contact the MAHC for a hearing

A property owner must spend $10,000 to pave his driveway. Upon completion of construction, his property value will increase by $7,500. In this case the deficiency would be considered to be incurable deterioration. curable functional obsolescence. incurable economic obsolescence. incurable functional obsolescence.

incurable deterioration.

At the time of the listing, a broker noticed a large crack in the wall that was partially covered by boxes. In showing the property, the licensee should: inform the prospective buyer of the crack inform the prospective buyer of the crack only if asked not tell the buyer since the agent represents the seller move the boxes to allow the buyer to see for themselves

inform the prospective buyer of the crack

An item associated with an item of real property may be distinguished as real or personal property by determining whether it is valued at a certain percentage of the value of the associated item. is physically smaller than the associated item. is permanently attached to land or structures of the associated item. was acquired at the same time as the associated item.

is permanently attached to land or structures of the associated item.

An individual property manager is usually a real estate broker who manages properties for one owner or a number of owners. usually manages a single large property. lives on the property and may be employed on a full or part-time basis. acts as the property owners' agent and adviser for the property.

is usually a real estate broker who manages properties for one owner or a number of owners.

Where would you find the names of all parties to a transaction, the amount of escrow funds the sponsoring broker received, and the date the broker received the funds? Record of Transactions Ledger Summary Journal Monthly Balance Sheet Report

ledger

A person who owns all ownership interests in real property is said to own statutory title. juridical title. equitable title. legal title.

legal title.

Antitrust laws prohibit market allocation. trade unions. market coops. volume discounting

market allocation.

When a lender is required to foreclose on a Deed of Trust, the lender does not have to go through the courts to foreclose; and the process is quicker. This is known as c judicial foreclosure. strict foreclosure. short sale foreclosure.

non-Judicial foreclosure.

An encroachment arises when a property owner grants a neighbor permission to build a structure that hangs over the property boundary. an easement is recorded on the title of a property. one property physically intrudes into another without authorization. a property owner builds a structure that is at variance with a zoning ordinance.

one property physically intrudes into another without authorization.

An agent is one who is the source of another's authority one who represents and acts for another one who has conferred authority to another one who has been paid a commission by another

one who represents and acts for another

A type of mortgage which allows the lender to increase the outstanding balance of a loan up to the original amount of the loan in order to advance additional funds is called an open-end mortgage. wraparound mortgage. bridge mortgage. take-out mortgage.

open-end mortgage.

The buyer's primary function at closing is to deliver the title. pay the real estate taxes. record the transaction. pay the purchase price for the property.

pay the purchase price for the property.

Remember for purposes of determining the new loan balance, you will not have to know how to determine the principal portion of the loan payment. interest portion of the payment. payment amount monthly interest amount.

payment amount.

Broker A received an offer of $189,000 on a $200,000 listing. After the seller had given the offer to his attorney to review, another offer for $176,000 came in. What should the broker do? present the offer as a backup do not present because it was not for full price wait until the first offer is acted upon present the offer immediately

present the offer immediately

The Federal Reserve controls the money supply by maintaining a fund from which member banks may borrow. requiring how much of a bank's assets have to be on reserve. lending money to qualified customers. setting the maximum interest rate that can be charged.

requiring how much of a bank's assets have to be on reserve.

A situation where an owner sells his or her improved property and at the same time, signs a long-term lease with the buyer is called a (an) bridge Loan. sale-leaseback. contract for deed. wraparound loan.

sale-leaseback.

To own an "interest in real estate," one must own a deed. an improvement. some part of the bundle of rights. acreage.

some part of the bundle of rights.

The valuable consideration necessary to make a contract valid must be money. something tangible. something specifically offered in exchange for something else. something of equal value with whatever is received in exchange.

something specifically offered in exchange for something else.

During the noon hour, all of the licensees at Dream Home Realty were out to lunch. A secretary was left to answer the telephone and to take messages. At 12:30, Salesperson Sampson of New Homes Inc., called to ask for information concerning one of Dream Homes' residential listings. In this situation, the secretary should give Sampson the information he needs but encourage him to get in touch with one of Dream Homes' agents as soon as possible. take Sampson's name and telephone number and tell him that a licensee from Dream Homes Realty will call him back when the licensee returns from lunch. reveal only the sale price and street address of the listing and get the contact information for Sampson so you can have the Dream Home agent call him back. tell Sampson that this information can only be given to a licensed broker and not a salesperson.

take Sampson's name and telephone number and tell him that a licensee from Dream Homes Realty will call him back when the licensee returns from lunch.

The principle of contribution is best exemplified as the value increase caused by movements in a capitalization rate. the amount of value a garage adds to the total property value. the decrease in value caused by an adverse zoning change. the increase in value caused by combining properties.

the amount of value a garage adds to the total property value.

In a cooperative, real property is owned only by the individual unit owners. the individual unit owners and the cooperative association. the cooperative developer. the corporate entity of the cooperative association.

the corporate entity of the cooperative association.

Real estate can be a poor investment if the inflation rate is high. the investor plans to hold the investment for a long time. the investor needs ready cash. land values are appreciating in the area.

the investor needs ready cash.

If an offeree alters any part of an offer and then signs it, the offeror must accept the contract with its alterations. the original offer is extinguished and the offeror is not bound by any agreement. the original offer becomes a contract with the alterations subject to acceptance or rejection by the offeror. the altered offer is a valid contract.

the original offer is extinguished and the offeror is not bound by any agreement.

Private land use control is primarily exerted by the courts via placement of deed restrictions on private property. the owner of the controlled property via deed restrictions. the owner of the property via zoning ordinances. the grantee of a property via restrictive covenants.

the owner of the controlled property via deed restrictions.

An implied contract may be deemed to exist if the parties do not disavow an express contract that has expired. the parties act as if there is a contract. an offering party does not receive written notice that the offer has been rejected. the parties promise to perform their part of the agreement if the other party performs.

the parties act as if there is a contract.

When a property manager or management company performs real-estate-related tasks (such as collecting rent) for one owner, and that owner is paying the manager a salary, the property manager must have a real estate salesperson license. the property manager must have a real estate brokers license. the property manager is not required to have a real estate license. the property manager must have a dual license (real estate and mortgage).

the property manager is not required to have a real estate license.

The seller under a land contract is called _____________ the grantor. the grantee. the vendor. the vendee.

the vendor.

One day, a nosy visitor finds a deed in the attic of a house. The deed is signed by the grantor, who is deceased, but the grantee is not named. The visitor writes in his own name and attempts to record the deed. However, the deed will probably not hold up because there was no consideration and no intent to deliver. the grantor did not sign a transfer certificate and attach it to the deed. the grantee did not sign the deed in the presence of the grantor. the grantor was deceased at the time of delivery.

there was no consideration and no intent to deliver.

Which would NOT be considered real property? House Mineral rights Air rights Trade fixtures

trade fixtures

A lease is an example of a(n) transfer of a portion of the bundle of rights. encroachment on the bundle of rights. transfer of the complete bundle of rights. transfer of surface rights.

transfer of a portion of the bundle of rights.

Legal title to an estate in trust is held by the trustor. trustee. beneficiary. grantor.

trustee

A range is defined by two consecutive guide parallels. two consecutive common tiers. two consecutive meridians. a parallel and a meridian.

two consecutive meridians.

When Brokers' Licenses are renewed, they are issued for a period ending one-year period on June 30 one-year period on Jan 1 two-year period on Jan 1 two-year period on June 30

two-year period on June 30

Bill and Bob share ownership of a real property, but neither owns a physical portion of the property. The kind of interest they each own is an invisible interest. intangible interest. undivided interest. insipid interest.

undivided interest.

The MREC can appoint a temporary legal license in which case? upon the death of the broker to terminate all listing agreements and coordinate the closing of pending contracts between sellers and buyers a temporary salesperson's license may be issued in cases of extreme urgency if a broker could NOT obtain a partner to allow a licensee who has had a license revoked to reprove himself

upon the death of the broker to terminate all listing agreements and coordinate the closing of pending contracts between sellers and buyers

A licensee attended three continuing education courses for the elective hours. Each course was 6 hours long. How can she apply these to her renewal requirement? use 9 for this period; carry 9 into the next licensure period use 12 hours for credit even though she only needs 9 elective hours use 9 hours for electives use all 18 hours for total accreditation this renewal period

use 9 hours for electives

The right to encumber a property means that the owner can build fences and road blocks. use the property as collateral for debt. lease the property. assign the bundle of rights to another.

use the property as collateral for debt.

The purchaser of real estate by deed or the buyer under a contract for deed is called the beneficiary. vendor. vendee obligor.

vendee.

A mortgage lien is a type of voluntary lien. involuntary lien. statutory lien. general lien

voluntary lien.

The Loan Estimate must be delivered to an applicant at the time the loan request is first made. within three calendar days prior to closing. within three calendar days of loan application. within three business days of loan application.

within three business days of loan application.

A branch office under a principal broker: would have to have its own set of licenses would operate under its own broker's license would operate under a duly appointed salesperson would operate under the principal broker's license

would operate under the principal broker's license

A branch office under a principal broker: would have to have its own set of licenses would operate under the principal broker's license would operate under a duly appointed salesperson would operate under its own broker's license

would operate under the principal broker's license

A broker's branch office would have all licensees licensed under the branch manager would operate under the same name and license as the parent office would operate under the same name, but under a different license than the parent office must have its own escrow account

would operate under the same name and license as the parent office

If advertised alone, which would be in violation of TRUTH IN LENDING? "FHA financing available" "Assumable loan" "No down payment required" "Easy financing terms"

"No down payment required"

A 20-unit apartment building rented for $750 per unit, per month. The annual Gross Income Multiplier was 9. What is the value of the property? $135,000 $1,350,000 $1,800,000 $1,620,000

$1,620,000

If a seller prepaid the taxes of $2,100 and the closing is set for March 15, using the 12month/30 day method what will the buyer owe the seller as prorated taxes? $431.62 $437.45 $1,662.55 $1,668.38

$1,662.55

A borrower obtains a 30-year $210,000 amortized loan at a 6% interest rate. If his monthly payment is $1199.10, how much is applied to the principal balance in the first month? $143.54 $144.94 $169 $149.10

$149.10

A property has a net income of $40,000, interest payments of $17,000, and annual cost recovery of $9,000. The property's tax rate is 25%. What is the property's annual tax liability? $5,750 $8,000 $3,500 $10,000

$3,500

The subject property has a no pool and a $5,000 screen porch. A comparable property that sold for $300,000 has no porch, one less $9,000 bathroom, and a small $4,000 pool. Assuming all else is equal, what is the adjusted value of the comparable? $310,000 $318,000 $300,000 $292,000

$310,000

A building has 7 office suites generating annual potential rent of $9,000 each. Vacancy = 8% and annual expenses are $25,000. Vending machines yield $3,000. What is the NOI? $63,000 $35,960 $32,960 $66,000

$35,960

Cheryl rents a 1400 sf storefront where her rent is $2.00 a sf. per month. Her lease calls for a 5.5% additional rent for annual sales over $100,000. She made $145,000 last year. What is her annual rent? $45,000 $33,600 $36,075 $78,600

$36,075

A scale drawing shows a room to be 3 inches by 4 ½ inches. Carpet is $15 per square yard is to be installed in the room. If the scale is 1 inch to 4 feet, how much would it cost to install the carpet? $120 $202 $360 $3,240

$360

If the monthly rent of a property is $4,000, and the gross rent multiplier (GRM) is 91, what is the value of the property? $404,000 $364,000 $439,560 $324,000

$364,000

A homeowner receives a tax bill that includes an amount for the library district, taxed at $2.00 per $1,000, and the fire protection district, taxed at $3.00 per $1,000. How much does the taxpayer have to pay for these two items if the property's taxable value is $78,000? $546 $1,560 $390 $234

$390

The tax assessment ratio for a house valued at $250,000 is 80%. If the tax rate is $2.00 per $100 what is the annual tax? $500 $5,000 $400 $4,000

$4,000

A homeowner receives a tax bill that includes an amount for the school district, taxed at $9.00 per $1,000, and the fire protection district, taxed at $3.00 per $1,000. How much does the taxpayer have to pay for these two items if the property's taxable value is $336,000? $4,032 $3,024 $8,064 $5,040

$4,032

The sellers, Mr. and Mrs. Hernandez, listed their property for $112,000 and agreed to an exclusive right to sell listing agreement at a 4% commission to be paid to Lucky Nines Estate Company at closing. The sellers sold the property themselves during the listing period for $106,000. How much commission, if any, would Lucky Nines Real Estate Company be entitled to at closing? $4,240 $4,480 $0 $4,360

$4,240

Agent Jim works on a flat 2% commission. He sells an in-house listing for $120,000 and also earns a $2,000 bonus from the listing client. What is owed Agent Jim? $2,860 $2,680 $4,400 $3,220

$4,400

Seller David requires a 4% deposit on all offers. Buyer Jack wants to offer $115,000 for the property. The property was appraised at $122,000. What must the earnest money deposit be if Jack presents his current offer? $4,600 $4,740 $4,880 $2,340

$4,600

A property has a gross income multiplier of 12, and value of $500,000. What is its annual income? $3,472 $60,000 $41,667 $600,000

$41,667

A property's land-to-improvements value ratio is 20% - 80%. The property was purchased 10 years ago, and depreciation has averaged $1,200 per year on the 3,000 SF house. If the improvements were built @ $120 / SF what is the current value of the property using the Cost Approach? $360,000 $420,000 $438,000 $450,000

$438,000

A home buyer pays $1,800 / month for the interest-only loan on his new house. The loan's interest rate is 6%. If he obtained an 80% loan, what was the purchase price? $216,000 $275,000 $450,000 $360,000

$450,000

Debra wants to net $100,000 on her house. Her closing costs will be 15,000 plus a 6% commission. She owes $310,000 on her loan. What is the minimum listing price that Debra can agree to? $438,221.39 $425,000 $452,127.66 $452,100

$452,127.66

Gladys sells another broker's $300,000 listing for $290,000 at a commission rate of 6%. She has a 60% commission split with her broker. If there is also a 50% brokerage split, what commission will Gladys receive? $5,220 $8,700 $17,400 $3,480

$5,220

A buyer got a 30-year loan with a loan balance of $65,000 with an interest rate of 10% and a factor of 8.78. What will be the borrowers monthly P & I payment? $425.30 $570.70 $3,456.98 $570,700

$570.70

A lender uses a 39% debt ratio. A borrower earns $40,000 / year and has monthly non-housing debt payments of $700. What housing payment can she afford? $600 $700 $900 $1,300

$600

A home seller wants to net $75,000. The commission is 9%, the loan payoff is $450,000, and closing costs are $36,000. What must the price be (to the nearest $100)? $561,000 $833,300 $616,500 $712,000

$616,500

Jim and Jane's home sold for $345,800. They owe $240,000 on their mortgage. What will their net be after they pay $10,000 in expenses and a 9% commission? $53,500 $64,678 $74,678 $82,700

$64,678

A commercial property sold for $564,000 and its GIM ratio was 8.7. What was the annual income of the property (rounded to the nearest $100)? $154,300 $47,000 $64,800 $56,400

$64,800

If a house sold for $40,000 and the buyer obtained an FHA-insured mortgage loan for $38,600, how much money would be paid in discount points if the lender charged four points? $1,600 $1,544 $1,500 $385

1,,544

A house is sold for $105,500 and the commission rate is 6 percent. If the commission is split 60/40 between the selling broker and the listing broker, respectively, and each broker splits his share of the commission evenly with his salesperson, how much will the listing salesperson receive from this sale? $1,266 $2,532 $3,165 $1,899

1,266

Assuming the FHA qualifies borrowers based on a 31% debt ratio, if a borrower's monthly gross income is $4,400, what monthly payment for housing expenses can this person afford based on this ratio? $3,036 $4,400 $1,364 $1,244

1,364

A rancher has a rectangular 40 acre piece of property fronting a highway. He wants to put a barbed-wire fence along his road frontage. How much fence does he need if his property depth is 1,200'? 1,200' 4,173' 1,612' 1,452'

1,452'

How many acres are there in the NE ¼ of the SW ¼ of the NW ¼ of a section? 5 acres 6 acres 9 acres 10 acres

10 acres

If the roof a property cost $14,000 and its economic life is 18 years, what would its value be after four years using a straight-line method of depreciation? $13,222 $9,240 $10,889 $12,666

10,889

It's common for a sponsoring broker to be required to keep all escrow records for 3-5 months. 8-10 months. 3-5 years. 6-8 years.

3-5 years.

A sponsoring broker must keep all escrow records for 1-2 years. 3-5 years. 5-7 years. 7-10 years.

3-6 years

An apartment building that sold for $900,000 had annual gross income of $124,000. What was its Annual Gross Income multiplier? 7.3 .14 11 .725

7.3

A building has 9 apartments generating annual potential rent of $1,500 each month. Vacancy = 6% and annual expenses are $84,000. Vending machines yield $1,800 per year. What is the NOI? $152,280 $79,800 $88,550 $70,080

70,080

The annual property taxes of $1,700 were paid in arrears by the buyer. If the closing took place on June 4th and the seller was responsible through the day of closing, how did this appear on the settlement sheet if the 360-day method is used? $727 DS, CB $727 DB, CS $973 DS, CB $973 DB, CS

727 DS, CB

Two parcels of land priced at $1,200 per acre were purchased. One parcel was 15 acres in size and the other was 1 mile square in size. How much did these two parcels cost together? $180,000 $640,000 $786,000 $1,020,000

786,000

If one discount point costs the borrower 1% of the loan amount, and increases the lender's yield by 1/8th of one percent, how many discount points must be purchased to lower the interest rate by 1%? 1 4 8 16

8

Which of the following is legal advertising? A broker who owns a building with a sign that reads, "For Sale, 555-1224." A broker who owns a building with a sign that reads, "For rent by Owner, 555-1234." A broker listing his own property with a sign that reads, "For Sale by Owner, 555-1234." A broker has a listing on his own property with a sign that reads, "For Sale, call ABC Realty."

A broker has a listing on his own property with a sign that reads, "For Sale, call ABC Realty."

Which of the following statements is FALSE? A broker may require licensees to carry high levels of automobile insurance. It's a good idea for brokers to carry workers' compensation coverage. A broker is not responsible for the acts of independent contractors. Employee status versus independent contractor status is an IRS issue.

A broker is not responsible for the acts of independent contractors.

A broker had several branch offices. Which is true regarding the management? The broker would have to have direct supervision over the main branch and branch offices. A broker-salesperson can have direct supervision over the branch office. A salesperson must have direct supervision over the branch offices. Each branch office must have a full-time broker who does NOT sell or list.

A broker-salesperson can have direct supervision over the branch office.

Salesperson Bird, has been licensed as a salesperson for at least two years. He has just passed the state broker examination and would like to apply for a broker-salesperson's license. In order to meet the requirements, he must include which of the following with his application? His personal affidavit stating that he has been actively engaged in the real estate business for at least one year. A certificate from an accredited school stating that within 6 months prior to the date of application that he had successfully completed a broker's license course offered by that school. A letter of proficiency from his broker stating that Bird has procured at least ten listings and at least ten closed sales. A statement from his broker indicating that Bird has finished management training and has been assigned as a branch manager for one of his broker's branch offices.

A certificate from an accredited school stating that within 6 months prior to the date of application that he had successfully completed a broker's license course offered by that school.

Which of the following contracts can be assigned to another party? An exclusive listing agreement An exclusive agency agreement A contract for the sale of a house An employment contract between a broker and a salesperson

A contract for the sale of a house

What is a tax deed? A conveyance instrument for a property that is sold to enforce a tax lien. A document recorded in title records showing that property taxes have been paid. A notice to a homeowner that a tax lien has been entered against the property. A document that gives a municipal authority the power to collect an individual tax bill.

A conveyance instrument for a property that is sold to enforce a tax lien.

______ is the cost per thousand that is required to create the principal and interest payment necessary to pay off a loan. A rate A point A factor A power

A factor

Which BEST describes the role of a fiduciary? A broker can only accept a reasonable amount of profit over the agreed upon consideration. A fiduciary relationship is established when a property manager agrees to represent an owner in leasing the owner's property. A fiduciary can only disclose confidential information obtained after termination of the fiduciary relationship. A fiduciary relationship is always created when a broker shows a buyer a house.

A fiduciary relationship is established when a property manager agrees to represent an owner in leasing the owner's property.

Which of the following sales typically do NOT come with a property disclosure? Single family residence A foreclosure or deed-in-lieu of foreclosure New construction Multi-family dwelling of up to four units

A foreclosure or deed-in-lieu of foreclosure

A life estate is classified as which of the following? An estate in fee simple A freehold estate A defensible fee An estate for years

A freehold estate

What does an owner own if the duration of his or her rights in an estate cannot be determined? A permanent life estate A freehold estate A leasehold estate A durable leased fee estate

A freehold estate

Which of the following is an example of external obsolescence? Four bedrooms and one bath in a house. Lack of insulation in an apartment building. A house abutting a closed factory. Lack of paint on a barn.

A house abutting a closed factory.

Conventional mortgages usually require insurance by FHA. guarantee by VA. A larger down payment. A loan by FNMA.

A larger down payment.

Most shopping centers have what type of lease? A lease based on traffic flow with minimum rents A net 50 lease A lease based on a sales percentage with minimum rents A lease based on income minus expenses

A lease based on a sales percentage with minimum rents

Under which of the following would one MOST likely see an estoppel certificate? A lender sells a loan, and the new mortgagee wants to know the existing balance A lender attempts to prevent a loan assumption to an unqualified party A developer attempts to have a parcel released from under a blanket mortgage A lender calls for full payment of a note

A lender sells a loan, and the new mortgagee wants to know the existing balance

What is a guide meridian? A north-south line that corresponds to a longitude on a map of the globe A north-south line that forms a township boundary A meridian every 24 miles east or west of a principal meridian to correct for the curvature of the earth A meridian that is designated as identifying townships in a geographical jurisdiction

A meridian every 24 miles east or west of a principal meridian to correct for the curvature of the earth

What is the National Electric Code? A professional code prescribing safe practices for members of the United Brotherhood of Electrical Workers. A federal law mandating procedures and materials that must be used in all residential construction in the United States. A national standard for the safe installation of electrical wiring and equipment voluntarily adopted by many states and municipalities. A national standard for professional practices voluntarily adopted by many electrical workers' unions and associations.

A national standard for the safe installation of electrical wiring and equipment voluntarily adopted by many states and municipalities.

What is the effect of the Doctrine of Laches? A property owner may impose a restriction of usage on all future owners of the property. The government may enforce a restrictive covenant against a private property owner. A property owner who is lax in protecting ownership rights may lose those rights. No property owner has the right to limit any legal business use of a property by means of a covenant or deed restriction.

A property owner who is lax in protecting ownership rights may lose those rights.

What is the impact on nonresidential property when a local government requires extensive building safety improvements? A reduction in property values A reduction in market value Required generation of a loss-leader accounting report A substantial amount of capital outlay

A substantial amount of capital outlay

Which of the following is NOT a way of terminating a restrictive covenant? Allowing a specified period of effectiveness to expire. Voting by property owners to end the restrictions. A suit for partition filed by a majority of property owners in a subdivision. Failure of property owners to enforce the restrictions in a timely manner.

A suit for partition filed by a majority of property owners in a subdivision.

A broker arranges a purchase agreement with the financing being part of a "first time buyer" bond program. However, the buyer is still $2,000 short of having enough for the down payment. The broker decided to write 2 contracts. One would be taken to the lender showing the $2,000 down as part of the loan. The real contract would NOT be changed. This is Allowable as all parties would be part of both contracts Allowable as long as it is in the form of a contract A violation of Missouri law (dual contracts) as you cannot change contracts to borrow extra money A violation of Missouri law as you cannot write " first time buyer" bond financing

A violation of Missouri law (dual contracts) as you cannot change contracts to borrow extra money

Broker Carr has a 90-day listing on a property. One month after the listing began, Broker Dole contacted the seller and told him that he had a buyer moving in one month after the listing terminates and asks the seller to sign an agreement to take effect after the listing expires. This is Misinterpretation A violation of the state law (going behind the sign) which is a class B misdemeanor Allowable since the listing would have expired Considered co-mingling of listings

A violation of the state law (going behind the sign) which is a class B misdemeanor

Agent Sam told a buyer that the fence line also marked the property line. Agent Sam knew that the property line did not extend to the fence line. Agent Sam's actions are an example of what? Passive fraud Unintended fraud Active fraud Puffing

Active fraud

What are the three primary areas of disclosure? Limits, conditions, and funding Relationships, performance history, investment value Agency, property condition, and environmental hazards Fiduciary, accounting, and feedback

Agency, property condition, and environmental hazards

If you receive a "Certificate of Completion" on Feb. 1, what is the last date that you may apply for the license? July 1 July 20 August 1 August 20

August 1

Which contract provision allows for the transfer of the contract to another person? Assignment of a Contract Operation of Law Transfer Clause Execute Clause

Assignment of a Contract

The primary intent of zoning ordinances is to: Assure the health, safety, and welfare of the community. Demonstrate the police power of the state. Limit the amount and types of business in a given area. Protect residential neighborhoods from commercial encroachment.

Assure the health, safety, and welfare of the community.

What is the latest date that a settlement agent is allowed to provide the seller with the Closing Disclosure? Three days before consummation of the mortgage At consummation of the mortgage Three business days before consummation of the mortgage Six business days before consummation of the mortgage

At consummation of the mortgage

The acronym AIDA stands for Action, Involvement, Detail, and Allowance Action, Increase, Develop, and Allowance Attention, Interest, Desire, and Action Allowance, Involvement, Develop, and Action

Attention, Interest, Desire, and Action

Which is not true regarding listings? Listing agreements may NOT have automatic extensions. Listing agreements must have an expiration date. A copy of the listing agreement must be given to the seller. Both buyer and seller must sign the listing agreement.

Both buyer and seller must sign the listing agreement.

What is the best approach to establishing a buyer's possession? Buyers take possession 2 days after the transaction close. Buyers take possession on the day of the close. Sellers should remain on the property at least 3 days after the closing date. Sellers should move from the property at least 5 days before the close date.

Buyers take possession on the day of the close.

Which of the following phrases should Salesperson Brenda avoid when writing an advertisement for one of her listings? Kosher meals available Christian home Fourth-floor walk-up Walk to bus stop

Christian home

For which of these properties would an appraiser most likely choose to use the cost method of appraisal? Apartment building Church Land Single-family home

Church

A buyer will receive a power bill for an estimated $140 at the end of the month. At closing, the seller has used an estimated $67 in power. What should appear on the closing statement? Credit the buyer $73 and debit the buyer $67 Credit the buyer $67 and debit the seller $67 Credit the seller $73 and debit the buyer $73. Debit the power company $73 and debit the buyer $67

Credit the buyer $67 and debit the seller $67

Posting a " FOR SALE " sign on a residential property without the owner's permission could lead to Criminal penalties by the MREC Disciplinary action by the MREC A fine by the MREC Civil penalties by the MREC

Disciplinary action by the MREC

Discrimination is prohibited in lending practices under _____________ ECOA. RESPA. Truth in Lending Act. FNMA.

ECOA

Which is NOT one of the four main types of leasehold estate? Estate for years Estate in holding Estate from period to period Estate at will

Estate in holding

Proof of ownership of a property is called what? Marketable title Abstract of title Evidence of title Title commitment

Evidence of title

Who is NOT an originator of primary loans? Savings and loans Credit unions Mortgage brokers FHA

FHA

All of the following are sources for obtaining a residential mortgage for the purchase of a single-family residence, except savings and loans. commercial banks. mortgage brokers. FNMA.

FNMA

A home improvement company was negotiating with a homeowner to add two rooms onto a home. The company agreed to take a second mortgage as long as the homeowner also included the rest of the property in the loan. The company and the homeowner agreed to a price, and the company provided the necessary disclosure form on Monday and the homeowner signed the agreement at noon the following day. Assuming that the week had five business days, until what time could the homeowner rescind the loan? Tuesday, midnight Thursday, midnight Friday, midnight There is no rescission on a house.

Friday, midnight

Eager Edgar, a licensed salesperson, lists seller Sue's home. After Sue signs the listing agreement, what is the proper procedure for Edgar to take? He must leave a copy of the listing agreement with Sue at the time of signing. He may wait to send a copy of the listing agreement to Sue until after the broker reviews and signs the documents. He may wait to send a copy of the listing agreement to Sue until after the property is placed in MLS. He is not required to furnish a copy of the listing agreement at any time because it is an employment contract rather than a sale contract.

He must leave a copy of the listing agreement with Sue at the time of signing.

An inactive licensee refers his brother as a buyer to an out-of-state broker. How much money can he receive for a referral fee? He will receive a referral fee directly from the out-of-state broker since he does not have a broker in Missouri. He will get 50% of the commission from the out-of-state broker. He will get whatever is called for in the referral agreement. He will get nothing.

He will get nothing.

Auctioneer Grant is negotiating to auction off some odds and ends for a farm family. In the course of the negotiation, the farmer asks Grant if he could also auction off the farm. Which BEST describes the situation? He would NOT have to have a real estate license as long as he sold the personal property and the farm together. He would NOT have to be licensed as long as he sold only the personal property and the land without any improvement on the land itself. He would have to have a real estate license to auction off the farm. He would NOT have to have a real estate license as he was auctioning it for the owner.

He would NOT have to have a real estate license as he was auctioning it for the owner.

How might a voidable contract become valid? If neither party agrees to the terms. If the party who has reason to disaffirm the contract elects instead to perform it. If the party who wants to enforce the contract seeks legal relief. If the party who wants to enforce the contract seeks damages.

If the party who has reason to disaffirm the contract elects instead to perform it.

If an owner of real property dies without leaving a will and with no legal heirs, what will generally happen to the property? It will revert to the state or county by escheat. It will transfer to the decedent's executor. It will be divided equally among adjoining property owners. It will become a public easement.

It will revert to the state or county by escheat.

Salesperson Karr negotiated a purchase contract with a prospect who met the conditions of a special first time buyer bond proposal, except for the fact that the negotiated sale price was $2,000 higher than the authorized limit set in order to qualify for the bond monies fully. Karr arranged another agreement with the seller, whereby the sale contract indicated a price within the limit, and another contract covered the $2,000 excess. Which of the following statements about this situation is true? This arrangement is considered creative financing and is perfectly legal. Although such arrangements are discouraged, Karr acted legally because he was carrying out the direct orders of the seller in order to sell the property for the list price. If the AHC (Administrative Hearing Commission) finds out about this arrangement, it will automatically suspend Karr's license. Karr is subject to disciplinary action by the MREC for violating the law against dual contracts.

Karr is subject to disciplinary action by the MREC for violating the law against dual contracts.

Licensee Jake found a buyer for seller Norm's house within three days of taking the listing. Seller Norm has now refused to sell. How does this impact licensee Jake's compensation? Licensee Jake would not be entitled to his compensation. Seller Norm would have to sell as an FSBO, and licensee Jake would be out his compensation. Licensee Jake can appeal to the MLS board for a partial compensation payment. Licensee Jake would still be entitled to his compensation.

Licensee Jake would still be entitled to his compensation.

Licensee Mike was owed a commission from seller Jane. Jane has refused to make payment. What recourse does licensee Mike have? Licensee Mike can sue Jane. Licensee Mike can petition the MLS for compensation. Licensee Mike can seek damages through his broker. Licensee Mike can place a lien on the property.

Licensee Mike can seek damages through his broker.

A violation of Hulse vs. Criger occurs when a broker Does not charge a fee for completing a form in a transaction wherein s/he is the listing broker Makes a separate charge for completing any standardized form for persons in transactions in which s/he is not acting as a broker Fills in the blanks in any standardized form provided by the real estate association in which she/he is a member Recommends that a buyer seeks the assistance of an attorney to review an offer before submitting it to the seller

Makes a separate charge for completing any standardized form for persons in transactions in which s/he is not acting as a broker

What is the number one rule of adjusting properties when using the Sales Comparison Approach to value? Always use assessed value, not market value Never adjust the subject property If the comparable is superior to the subject, add value to the comparable. If the comparable is inferior to the subject, subtract value from the comparable.

Never adjust the subject property

Salesperson Larry is writing an advertisement for one of his listings. Which of the following phrases should he avoid? Desirable neighborhood Apartment complex with chapel Mother-in-law suite No wheelchairs

No wheelchairs

A salesperson decides to transfer to another broker. He wants to take his listings with him. If he gets the consent of each seller to do this, is he within his rights to take these listings to another broker? Yes, because they were personally acquired by him all of the listings may be transferred to the salesperson's new broker. No, a listing agreement may not be transferred to another broker without the express written consent of the seller and the original broker. Yes, the seller's consent to have that specific agent market the seller's home allows the salesperson to assign, transfer, or sell the listing contract. No, a listing contract is canceled when the salesperson is transferred or terminates employment.

No, a listing agreement may not be transferred to another broker without the express written consent of the seller and the original broker.

Can the MREC suspend a license while the salesperson is under investigation? Yes, the MREC can suspend a license anytime they want. Yes, a salesperson's license can be suspended, but a broker's cannot. No, a salesperson must have a hearing and be found guilty by the AHC before the MREC can suspend his license. No, once a license has been issued, it cannot be suspended for any reason other than a felony.

No, a salesperson must have a hearing and be found guilty by the AHC before the MREC can suspend his license.

A broker had so many lawsuits that he decided to change the name of his branch offices to avoid further problems. Could he do this? Yes, he may do so with the approval of the MREC. Yes, but all advertising must be done with both names. No, all branch offices must have the same name as the parent office. No, the MREC assigns the names for each branch office.

No, all branch offices must have the same name as the parent office.

An owner advertised "beautiful acreage only $5,000 down, owner will personally finance down payment." Would this be in violation of the Truth in Lending Act? Yes, acreage is not exempt from Reg Z. Yes, since a down payment was stated. No, owners are not covered by Reg. Z. No, brokers can advertise the down payment.

No, owners are not covered by Reg. Z.

A friend who was getting a divorce called the broker to ask the broker to complete a quit claim for the friend to deed the property to his ex-wife. Can the broker do this? Yes, because a broker is allowed to complete standardized forms even when he is not involved in the transaction. Yes, the broker may complete the form for a nominal fee. No, the broker can never complete a quit claim deed since it is not a standardized form. No, since he is not a party to the transaction, he would be practicing law if he completed the form.

No, since he is not a party to the transaction, he would be practicing law if he completed the form.

A new agent got permission from friends to put "for sale" signs in their yards. When buyers called in, she told them the house had sold, but she would be happy to help them find another. Is this permissible? Yes, it's simply a sales technique. Yes, as long as friends were justly compensated. No, since the properties were not really sold. No, since the properties were not really "for sale" and this is a misrepresentation.

No, since the properties were not really "for sale" and this is a misrepresentation.

A new agent obtained permission from her friends to put up "for sale" signs in their yards. When buyers called, she told them that the house was sold, but that she would be happy to help them find another. Is this permissible? Yes, it is simply a sales technique. Yes, as long as the friends were justly compensated. No, since the properties were not really sold. No, since the properties were not really for sale, this technique would be considered by the MREC to be a misrepresentation.

No, since the properties were not really for sale, this technique would be considered by the MREC to be a misrepresentation.

An out of town owner, Seller Carr, writes Broker Falk asking him to sell her residential property. They communicate with several more letters. Can Broker Falk sell Seller Carr's property? No, this is a violation of the Statue of Frauds. No, since they have never met face to face. Yes, this is a listing by implication. No, there must be a written listing, which contains all of the terms and conditions under which a residential property is to be sold to show or advertise the property.

No, there must be a written listing, which contains all of the terms and conditions under which a residential property is to be sold to show or advertise the property.

Beginning at the SE corner of the intersection of Olive & 270, thence south 350 feet, thence west 350 feet, thence north 400 feet, thence east 400 feet. Is this a good legal description? No, this is not a good legal description because it does not begin and end at the point of beginning. No, legal descriptions cannot be determined in this manner. Yes, this is a good legal description of a parcel of land. Yes, it is not necessary for a legal description to begin and end at the point of beginning.

No, this is not a good legal description because it does not begin and end at the point of beginning.

All of the following are violations of Missouri License Law except: Telling a potential buyer that the property will definitely appreciate in value and that a substantial profit will be made on the resale of this real estate investment. Advising a young married couple to take title as tenancy by the entirety; explaining their rights in the event the seller breaches the contract, and helping them to rewrite a better offer to purchase. Placing the buyer's $2,000 earnest money deposit in an escrow account after acceptance of a contract by the seller. Preparing a special sales contract to suit the needs of a new home buyer who disagrees with the terms of a standard form and who intends to fill in the blanks after the contract is accepted.

Placing the buyer's $2,000 earnest money deposit in an escrow account after acceptance of a contract by the seller.

Puffing is a term characterized by which of the following actions? Providing opinions Giving fraudulent statements Giving objective information Misrepresenting the facts

Providing opinions

The Smiths' purchased a residence for $75,000. They made a down payment of $15,000 and agreed to assume the seller's existing mortgage, which had a current balance of $23,000. The Smiths' financed the remaining $37,000 of the purchase price by executing a second mortgage whereby the seller became a mortgagee. This type of loan is called a Wraparound mortgage Package mortgage Balloon note Purchase money mortgage

Purchase money mortgage

Which of the following is a simple definition of real estate? Real estate is property traded between owners and buyers for money. Real estate is that it is air, water, land, and everything affixed to the land. Real estate is any building affixed to land owned by an individual. Real estate is residential property, but not commercial property.

Real estate is that it is air, water, land, and everything affixed to the land.

Which of the following is NOT a resource for information regarding professional ethics? Federal laws Licensing regulations Real estate marketing copy Real estate associations

Real estate marketing copy

Which of the following is not a source of information for professional ethics codes? State laws Licensing regulations Real estate associations Real estate schools

Real estate schools

A real estate tax lien, a federal income tax lien, a judgment lien, and a mortgage lien are recorded against a property. Which lien will be paid first when the property is sold? Real estate tax lien Federal income tax lien Judgment lien Mortgage lien

Real estate tax lien

Salesperson Falk lists the home of Seller Spence. It has been a very rainy spring and the basement has had a considerable amount of water in it, which Seller Spence readily discloses to Salesperson Falk. Which of the following statements is true? Salesperson Falk is NOT legally required to mention this fact to the prospective purchasers as the situation only happens occasionally. Salesperson Falk should inform prospective purchasers of this fact but add " it's no problem, we rarely have a lot of rain in this part of the country." Salesperson Falk should inform a prospective purchaser of this fact and include the disclosure in writing with the sales contract. Salesperson Falk is NOT legally required to mention the facts regarding the fact of the condition of the property since he is the agent of the seller.

Salesperson Falk should inform a prospective purchaser of this fact and include the disclosure in writing with the sales contract.

What do we call an agent who represents a seller exclusively in a real estate transaction? Exclusive agent Single agent Subagent Broker agent

Single agent

If a sworn complaint is filed with the MREC alleging misconduct on the part of a licensee, the Commission Shall investigate the actions of the licensee against whom the complaint is made Must investigate the complaint only if the commission thinks the violation is bad Will be limited in their investigation to only the business dealings noted in the sworn complaint even if the commission does not receive the complaint in writing, they must proceed with an investigation

Shall investigate the actions of the licensee against whom the complaint is made

A Missouri broker Shall keep all records for 10 years Shall retain for a period of at least three (3) years true copies of all business books Is NOT required by law to keep records for a certain time Can charge a separate fee related to retention of records

Shall retain for a period of at least three (3) years true copies of all business books

A woman passed the salesperson examination and is eager to begin listing and selling homes. What can she do? She will automatically receive a license. She can list homes, but cannot sell them. She must apply for a license on the forms provided by the MREC. She must first take her broker's sales training before she can begin work.

She must apply for a license on the forms provided by the MREC.

If a group of brokers has a meeting to set commission rates, what does this violate? Fair Housing Act Sherman Antitrust Act Civil Rights Act of 1968 Jones v. Mayer

Sherman Antitrust Act

Which type of real estate advertisement is typically located in areas with a high presence of foot traffic? Billboards Radio Ads Door Hangers Shopping Guides

Shopping Guides

What is an agent called who represents only one person in the transaction, either the buyer or the seller? Subagent Designated agent Dual-agent Single agent

Single agent

What are the two forms of owner's title insurance? Formal and Informal Basic and Comprehensive Short and Long Standard and Extended

Standard and Extended

A seller can agree to accept or reject which of these options when he or she signs the listing contract? Subagency Facilitator Disclosure Non-agency

Subagency

When a seller agrees to an MLS listing, what is the seller authorizing? Designated agency Subagency Dual agency Exclusive agency

Subagency

When a seller gives permission to a broker to submit the property to the MLS, the seller is authorizing the broker to make a blanket unilateral offer of what to all the other members of that MLS? Subagency Designated agency Dual agency Non-agency

Subagency

How should a seller deal with an interested party that shows up at their front door unannounced and wants to see the house? The seller should conduct a tour. Take the person's name and then call the office immediately so an agent can come to do the showing. Give the visitor a flyer and the agent's business card. Tell the visitor when the next open house is scheduled.

Take the person's name and then call the office immediately so an agent can come to do the showing.

Which of the following was an important result of the National Environmental Policy Act of 1969? Money was provided for hazardous waste disposal. The Environmental Protection Agency was created. Lead was banned in the manufacture of plumbing materials. Transportation-related noise was banned.

The Environmental Protection Agency was created.

The basic difference between an FHA and a VA loan is The FHA guarantees loans; the VA insures them. The FHA insures loans, the VA guarantees them. Both required 20% down payment. The FHA requires no down payment, VA requires 5% down payment.

The FHA insures loans, the VA guarantees them.

Obedience of the agent to the principal means what? The agent may disobey those instructions in good faith if the agent feels it is necessary The agent must follow all the instructions of the seller even if they violate state law The agent must follow those instructions regardless of personal feelings about them, as long as they do not violate the state or federal laws. The agent must follow all those instructions regardless of the consequences.

The agent must follow those instructions regardless of personal feelings about them, as long as they do not violate the state or federal laws.

Bill, a licensed real estate salesperson places an ad in the newspaper for a buyer of a property he has listed for sale. His ad reads: "Come and see this wonderful lake lot located on beautiful Lake Scenic. If you purchase one lot, we will give you a second lot free and also enter your name in our lottery sweepstakes." Which is true of this advertisement? The ad is well written and should attract many buyers The ad should give the property address The ad should list Bill's address The ad is a violation of the license law because it offers free inducements

The ad is a violation of the license law because it offers free inducements

Which of the following is a true statement about a salesperson who violates the Missouri Real Estate License Law? (Chapter 339-250) The agent could be charged with a class B felony. The agent may not be subject to criminal prosecution under the general laws of the state. The agent may not incur civil liability under the general laws of the state. The agent could have his license revoked for violation of the law. Violation of MREC rules is a Class B Misdemeanor.

The agent could have his license revoked for violation of the law. Violation of MREC rules is a Class B Misdemeanor.

When a salesperson terminates his/her association with a broker, which of the following statements is true? The agent has six months to place his license with another broker or put his/her license on inactive status with the MREC. The agent may have friends' listings transferred to his/her new broker. The broker must return the salesperson's license to the MREC within 48 hours. The broker must give the agent his license when the agent submits a written notification of resignation.

The agent has six months to place his license with another broker or put his/her license on inactive status with the MREC.

A person walks into Urban Realty and asks to be shown some homes in the area. Regarding agency disclosure, the agent must inform the potential buyer of specific facts. Which of the following is required by the License Law? The agent must inform the potential buyer that the agent always represents the seller of any listed property and that agent will not represent the buyer at all. The agent must inform the buyer that any information received from either the buyer or seller will be fairly communicated to the both sides. The agent must inform the buyer that an agency disclosure form must be signed by the buyer prior to any property being shown. The agent must inform the buyer that if the buyer wishes representation, he must sign a Buyer's Agency Agreement before seeing any property.

The agent must inform the buyer that if the buyer wishes representation, he must sign a Buyer's Agency Agreement before seeing any property.

A homeseller signs a listing agreement with a broker and the next week decides not to sell and revokes the listing. Which of the following is true? The seller has no contractual obligations to the broker. The contract remains in full force until the expiration date. The broker may have a claim for damages. The seller cannot sign a listing agreement with another broker.

The broker may have a claim for damages.

What piece of information is missing from a blind ad? The price The property's address The broker's identification The property's features

The broker's identification

What dictates the minimum and maximum pressures allowed for plumbing fixtures? The building codes The certificate of occupancy The zoning laws The blueprints

The building codes

Who has the burden of proof for an assessment change when a homeowner appeals an assessment? The assessor The tax appraiser The homeowner The board of assessment review

The homeowner

A lease automatically terminates under which of the following circumstances? The tenant fails to pay rent. The leased property is foreclosed. The tenant goes out of business. The landlord cancels the lease.

The leased property is foreclosed.

An impound or reserve account MOST benefits whom? The borrower The lender The trustee The trustor

The lender

In an IRS audit, which of the following situations would cause the IRS to think that a contractor might really be an employee? The licensee attends sales meetings. The licensee gets a commission. The licensee takes unpaid sick days. The licensee receives an hourly wage.

The licensee receives an hourly wage.

Which of the following situations would cause the IRS to think that a contractor is really an employee? The licensee attends sales meetings. The licensee gets a commission. The licensee takes paid sick days. The licensee pays for transportation expenses.

The licensee takes paid sick days.

A seller accepts an offer without realizing that the buyer has died since making the offer. Which of the following best describes the status of the contract? The contract requires the buyer's estate to complete the purchase before the estate is probated. The contract requires the buyer's heirs to complete the purchase after the estate is settled. The offer was terminated by the buyer's death; there is no contract. The seller must convey the property to the buyer's heirs under the terms of the contract as originally accepted.

The offer was terminated by the buyer's death; there is no contract.

What is "escheat?" The principle that gives governments the right to levy real estate taxes. The process by which a squatter can obtain legal title to real estate. The process by which a municipality condemns land and takes it for public use. The process by which ownership of real estate reverts to the state when there are no legal owners.

The process by which ownership of real estate reverts to the state when there are no legal owners.

Which of the following would usually occur in a sale-and-leaseback transaction? The seller gets a return on the purchase in the form of rental payments. The property is sold on the condition that the new owner leases it back to the seller at the time title passes. The buyer keeps capital in inventories rather than in realty. The rent that the seller pays is not income-tax deductible.

The property is sold on the condition that the new owner leases it back to the seller at the time title passes.

All of the following are true of conventional loans except what? They are made to the buyer without governmental insurance or guarantee. The policy requirements of the lenders are not uniform. The requirements to qualify are uniformly fixed by state law. They require a higher down payment than non-conventional loans.

The requirements to qualify are uniformly fixed by state law.

Dawn, a licensed salesperson, was at a party and a young couple expressed interest in buying a new home. Dawn mentioned that her own home was for sale and that she would be happy to show it to them. In this case, which of the following is true? The salesperson must disclose that she is licensed and the owner of the property. The salesperson must have the permission of her broker before showing her home to a prospective purchaser. Because this is the salesperson's own property, she need only disclose that she is the owner of the property. The salesperson is prohibited from selling her own property.

The salesperson must disclose that she is licensed and the owner of the property.

A young couple is selling their first residence and would like a lawyer to check over the sale contract. The listing agent, who knows the contract is well written and that the contract used is approved by the attorney of their local association of REALTORS ®, advises them that a lawyer's services would be an unnecessary expense and would only serve to reduce their net proceeds from the sale. Which of the following statements is true? The salesperson should never advise against or discourage the use of an attorney in any transaction in which he/she is involved. The salesperson may advise against using an attorney, but only if it will save the sellers money. The salesperson's actions were correct because a lawyer must check sales contracts on commercial transactions only. The salesperson is to be commended for looking out for the best interest of his principals.

The salesperson should never advise against or discourage the use of an attorney in any transaction in which he/she is involved.

A salesperson is asked to take a promissory note from the buyer. What should he do? The salesperson should go to his broker for help. The salesperson should do nothing: the salesperson cannot accept non-money items as earnest money. The salesperson should make the buyer get real cash or a check instead of a promissory note. The salesperson should write the offer and explain to the seller in the offer that the earnest money is a promissory note.

The salesperson should write the offer and explain to the seller in the offer that the earnest money is a promissory note.

Licensee Jones is in the process of closing a sale. However, the property title has been found to have uncorrectable defects. What is the result regarding Jones compensation? If the property doesn't close, there will be no compensation. The title company owes licensee Jones compensation. Compensation will be prorated based on work performed by licensee Jones. The seller is still liable for licensee Jones' compensation.

The seller is still liable for licensee Jones' compensation.

When the lender under a deed of trust required title insurance, who would be the most likely person to pay for it? The mortgagee The trustee The trustor The beneficiary

The trustor

What is the basis for determining the amount of a condominium owner's monthly assessment for operations and maintenance? The unit's appraised value The number of shares the owner purchased in the condominium association The unit's pro rata ownership share as defined in the declaration The unit's pro rata share of total floor space in the building

The unit's pro rata ownership share as defined in the declaration

What is unregulated property use likely to jeopardize? The rights of developers to build new properties. The levels of income tax within the area. The value of properties within an area. The rights of owners to sell their properties.

The value of properties within an area.

Which of the following circumstances is likely to render a will invalid? The testator is only 21 years old. The devisee is under duress. The will is unsigned. The will is signed by three witnesses.

The will is unsigned.

A property built 23 years ago had a roof overhang that extended 1½ feet onto a neighbor's property. What could happen? This could create an easement by prescription. The owner of the property could make the owner of the roof pay him for the land. Neither property owner could do anything since it has gone on for so long and hasn't bothered anyone. The owner of the property may have a better chance of suing to have the encroachment removed because damages could not be awarded that many years later.

This could create an easement by prescription.

What action identifies if any liens are on a property? Title Search Lien File Dispatch Application for HUD-2 Opinion of Sale

Title Search

Which of the following is an accurate statement? To derive Net Operating Income, deduct the annual operating expenses from Annual Gross Income to derive Net Operating Income. To derive the GRM, net income is used. To derive the capitalization rate, the value is divided by income. The GRM and cap rate are equally desirable to an investor in determining a price to offer.

To derive Net Operating Income, deduct the annual operating expenses from Annual Gross Income to derive Net Operating Income.

What is the fundamental purpose of a building permit? To restrict the number of new development projects To establish the basis for an inspection To ensure that improvements comply with codes To promote certificates of occupancy

To ensure that improvements comply with codes

Which of the following must a broker legally provide to an employee? Pension plan Unemployment insurance Health insurance Sales commission

Unemployment insurance

Murphy, a buyer (customer), does not know about the leaking basement so he proceeds to make an offer. Should the broker (salesperson) who represents the seller have told Murphy about the defect? No, caveat emptor would apply in this case. No, the broker is the agent for the seller he should not mention the basement unless he is asked. Yes, any defects known to the broker should have been disclosed to Murphy. Yes, the broker owes Murphy a fiduciary relationship.

Yes, any defects known to the broker should have been disclosed to Murphy.

A real estate office was located in a nice, residential neighborhood. The broker did not want to put up a large sign so he/she put up a small sign with his/her name and phone number on it. Is this permissible? Yes, as long as it was on the inside wall of the house Yes, as long as it is of sufficient size to be identifiable No, because it cannot be seen from the street No, the sign can only have the name not the phone number

Yes, as long as it is of sufficient size to be identifiable

A person finished pre-license school on July 31, 2012. After taking the examination on December 15, the applicant received a passing score on December 31, 2012. The person applied for a license on January 15, 2013. Could this person receive a license? No, because the applicant had taken the school in a different calendar year from applying for a license. Yes, because the applicant applied for a license within six (6) months after completing the school. No, because it had been over six (6) months from the time of completing the school and applying for a license. Yes, because the applicant applied for a license within sixty (60) days after passing the examination.

Yes, because the applicant applied for a license within six (6) months after completing the school.

Fair housing violations are covered by general business insurance. are mostly covered by MLS association insurance. are mostly covered by errors and omissions insurance. are mostly not covered by any insurance.

are mostly not covered by any insurance.

A licensee negotiates the sale of a home intended for his fiancée and himself. He properly identifies himself as a licensee to the seller but neglects to disclose that he is getting married to the buyer. Do the actions of the licensee violate the license law? Yes, because a licensee cannot purchase or negotiate the sale of property in which the licensee will have a future interest. Yes, because the licensee did not disclose his possible future interest to the seller. No, because a licensee's marital plans do not require agency disclosure. No, because a licensee is simply required to give proper real estate company identification only.

Yes, because the licensee did not disclose his possible future interest to the seller.

The buyer wants to have his earnest money placed in an interest bearing account. Can the broker do this? Yes, if the interest goes to the broker. Yes, if all parties to the transaction agree to the interest-bearing account and who will receive the interest. No. Regardless of what the buyer wants, the broker can never put the money in an interest-bearing account because it is a violation of the Missouri License Law. No, because this is the seller's money and he has to make the decision.

Yes, if all parties to the transaction agree to the interest-bearing account and who will receive the interest.

Salesperson Baird was born in Finland. He moved to Missouri, went to a pre-license school, took and passed the test, and was licensed. He then sold a property. Would Baird be eligible for a commission? Yes, since he passed the test. Yes, since he fulfilled the legal requirements of the law. No, because he was not a citizen. No, since he was born in Finland, and he studied too hard he should not be allowed to obtain a license.

Yes, since he fulfilled the legal requirements of the law.

A buyer wanted to use a promissory note for consideration on the purchase of a property. Can he do this? Yes, the buyer can do as he wishes since he is making the contract. Yes, this is acceptable as long as the seller agrees. No, only money can be used for consideration. No, only the seller can write a promissory note.

Yes, this is acceptable as long as the seller agrees.

A borrower bought a $74,000 house with no down payment. The loan was probably ______________ a conventional insured loan. a VA loan. an FHA loan. a conventional loan.

a VA loan.

Dole is considering creating a real estate company as a corporation. If he does so, which license would be required of the corporation itself? a broker's license a broker-officer's license a salesperson's license a broker-associate license

a broker's license

A stabilized budget is a budget which forecasts income and expenses that can be projected over a short period of time, usually five years. a budget for annual depreciation and non-cash items. a budget to plan for financing long-term outlays, such as for fixed assets like facilities and equipment. an annual budget which includes the income and expenses for ongoing operations.

a budget which forecasts income and expenses that can be projected over a short period of time, usually five years.

As a listing agent, in most cases, your listing will be sold by yourself your broker a cooperating broker an assigned agent

a cooperating broker

If a property sold at a court foreclosure does not sell for an amount sufficient to satisfy the outstanding mortgage loan debt, the mortgagee may sue for a judgment by default. a deficiency judgment. a satisfaction of mortgage. damages.

a deficiency judgment.

If prioritizing loans as when recording, a second mortgage or deed of trust is referred to as a secondary loan. an underwater mortgage. a factored loan or mortgage. a junior mortgage.

a junior mortgage.

A valid contract that conveys an interest in real estate must contain a novation clause. a title certificate. a legal description of the property. the signature of a member of the state bar association.

a legal description of the property.

An improvement to a local restaurant does not comply with the zoning ordinances because it was constructed prior to the adoption of the zoning laws, and its use is one that clearly differs from current zoning. This is known as an illegal nonconforming use. a variance. a special exception. a legal nonconforming use.

a legal nonconforming use.

Agent Sue listed and sold the same property. Agent Sue is owed a listing commission. a selling commission. a listing and selling commission. combination commission.

a listing and selling commission.

A building with integrated office and retail space would be considered a Class A building. a mixed-use property. institutional real estate. a flex-space development.

a mixed-use property.

Which of the following statements about real estate licenses is true? each license is issued for a one-year period and expires on June 30. the real estate commission must send a renewal application to the licensee's last known address by certified mail at least 30 days in advance of the license expiration date. if a licensee does not receive a renewal notice, the real estate commission rules provide an automatic 30 day grace period. a new license will be issued only upon receipt of the fee and properly completed application.

a new license will be issued only upon receipt of the fee and properly completed application.

A commercial bank would usually make all of the following loans EXCEPT, construction. home improvement loans. loans for a mobile home. a pension fund loan.

a pension fund loan.

Which of the following is not needed on a current Listing Agreement? the price a provision requiring an owner to notify the broker of intent to cancel the listing after the expiration date a definite beginning date an expiration date

a provision requiring an owner to notify the broker of intent to cancel the listing after the expiration date

A plat of survey is best described as a survey of an entire subdivision. a completed lot survey. a registered metes and bounds legal description. a plat map recorded in the state land bureau of records where the property is located.

a survey of an entire subdivision.

Ventilation air is the air used for providing pure oxygen air. only cool air. acceptable indoor air quality. enough carbon dioxide to breathe.

acceptable indoor air quality.

A contract between the buyer and seller failed. The buyer claimed the earnest money was his; the seller claimed the earnest money was his. After 60 days the broker sent a registered letter saying he would give the earnest money to the seller. Lacking response from either party when could the broker release the money? after 10 days after 15 days after the judgment of the court never, the broker must have a mutual release

after 15 days

The right to build a taller structure on top of an existing structure is an example of the right to encumber. surface rights. the right to liquidate. air rights.

air rights

If ABC Company has the right to build a structure on top of DEF's existing structure, ABC owns a dominant tenement. air rights. the right to improve. surface rights.

air rights.

If a party has an interest in real estate that includes the right of possession, the party owns an encumbrance. a fractional part of an estate. an enjoinment. an estate in land.

an estate in land.

A home in a residential zone is converted to an antique store. This would be an example of a legal conforming use. a legal nonconforming use. an illegal use. a legal variance.

an illegal use.

Unlike other property taxes, a special assessment tax does not create a lien on the property. applies a reduced tax rate to properties not affected by the project to be funded. applies only to properties which will directly benefit from the project to be funded. taxes properties with a higher assessed value at a proportionately higher rate.

applies only to properties which will directly benefit from the project to be funded.

Pedestrian Shopping Streets are, for the most part, shopping malls, usually housing several department stores. are malls which include stores owned by manufacturers, distributors, or others selling off-price merchandise. are comprised of stores usually set up side by side. The amount of foot traffic directly affects the sales volumes and, therefore, the rents. are older well-maintained office buildings.

are comprised of stores usually set up side by side. The amount of foot traffic directly affects the sales volumes and, therefore, the rents

Two individuals own a house as tenants by the entireties. They can do this because they are incorporated. acquired title at the same time. are related by blood. are married.

are married.

Ownership rights, such as those to possess and use a property, cannot be violated. are absolute. vary with the type of property involved. are subject to what the law allows.

are subject to what the law allows.

Leases for hunting rights are typically shorter than farming leases. are typically longer than farming leases. are typically shorter than motel leases. must be written for a term of no less than 12 months and 10 days.

are typically shorter than farming leases.

A mortgage broker _____________ arranges loans between borrowers and investors. is a lender. buys mortgages in the secondary mortgage market. buys mortgages and resells them at a profit.

arranges loans between borrowers and investors.

The tax base in a jurisdiction is derived by subtracting exemptions from sales values. the tax rate. assessed values. residual values.

assessed values.

Fees and commissions must be removed from a property management escrow account unless otherwise stated in a written agreement how often? at least once a week at least once a month at least once a year whenever the broker wishes

at least once a month

The disbursements from an escrow account of a property manager must show all EXCEPT check number indicate the related transaction indicate to whom the check was written and why balance of the account to the owner

balance of the account to the owner

Which of the following is not grounds for the MREC to refuse to issue a license? conviction of obtaining money under false pretenses fraud on application bankruptcy revocation of an earlier license

bankruptcy

The maximum permissible "loan to value ratios" are _____________ based on sale price or appraised value, whichever is lower. not determined by federal statute in the case of FHA loans. based on the banker's competitive market analysis. fixed by law for conventional loans.

based on sale price or appraised value, whichever is lower.

Under Regulation Z, consummation is defined as the time when a consumer requests a loan application. becomes contractually obligated on a credit transaction. is within three days of closing a transaction. is given a completed Loan Estimate.

becomes contractually obligated on a credit transaction.

At what point must a listing broker FIRST disclose to a buyer the broker's agency relationship with the seller in a residential real estate transaction? before the buyer gives the broker personal or financial information when the broker writes the contract at the first written contact at the first oral contact

before the buyer gives the broker personal or financial information

All of the following are accepted methods of legal description EXCEPT Lot and Block. Metes and Bounds. Rectangular Survey. Block and Tackle.

block and tackle

A lease is both an instrument of conveyance and a contract. neither an instrument of conveyance nor contract. a promise note. a document that conveys legal title.

both an instrument of conveyance and a contract.

All are true regarding listings EXCEPT listing agreements may NOT have automatic extensions listing agreements must have an expiration date a copy of the listing agreement must be given to the seller both buyer and seller must sign the listing agreement

both buyer and seller must sign the listing agreement

The seller cannot withhold property from a "protected class" individual, and the real estate professional must definitely not be involved should this happen. If this does occur, both the seller and the agent or broker could be found in violation of the fair housing laws. only the broker could be found in violation of the fair housing laws. only the seller could be found in violation of the fair housing laws. both the buyer and seller could be found in violation of the fair housing laws.

both the seller and the agent or broker could be found in violation of the fair housing laws.

An agreement in which a seller hires a broker to market a property creates an agency relationship between the listing agent, buyer, and seller. buyer and broker. broker, buyer, and seller. broker and seller

broker and seller

A broker opened a branch office. Who could have authority to manage the office? broker-salesperson salesperson any licensee so designated the broker

broker-salesperson

Which party is responsible for filling out a property disclosure statement? The cooperating agent The listing agent The broker The sellers

sellers

Mr. Baird was the sole proprietor of a commercial real estate company. He died. His son, Jim Baird did not have a real estate license, but he was named executor of the estate. Jim Baird can continue the real estate company in his name as he is the executor of the estate can transfer listings to another broker can be appointed to finish only the business in process must purchase all the listings

can be appointed to finish only the business in process

Eminent domain is applicable only when the owner agrees with the government's superior claim. may be exercised with no obligation to compensate the owner. may be applied to any privately-owned property and for any purpose whatever, including reselling for a profit. can take a property from an unwilling property owner by process of condemnation.

can take a property from an unwilling property owner by process of condemnation.

Unlike deed restrictions, declaration restrictions cannot be extinguished by a quitclaim deed. do not attach to the property. focus on construction requirements. are used only on commercial properties.

cannot be extinguished by a quitclaim deed.

Home tours are oftentimes referred to as caravans. go and shows. circus parades. meet and greets.

caravans

The license fees are payable by: cash by certified mail personal check only cashier's check, personal check, or money order made payable to Missouri Real Estate Commission cashier's check only

cashier's check, personal check, or money order made payable to Missouri Real Estate Commission

All of the following are requirements for licensure of a salesperson EXCEPT honesty and integrity citizenship complete an approved salesperson's course send in money by certified check or money order

citizenship

A type of closing where a third party acts as the escrow agent for the buyer and seller and conducts all the closing activities is called a face to face closing. qualified closing. non-recourse closing. closing in escrow.

closing in escrow.

Truth In Lending applies to all of the following, except commercial property. residential loans. federally related 1-4 family properties. family farms.

commercial property.

Burger King locates a franchise across the street from a McDonalds. At play here is the principle of anticipation. competition. conformity. assemblage.

competition

During the investigation period, HUD can attempt to resolve the complaint by getting assurance from the person against whom the complaint was filed that he or she will remedy the alleged violation. This is known as a concessionary mandate. conciliation. concurrence. a warrant of siezen

conciliation

Conditions and covenants differ in that conditions can be created only at the time of transferring ownership. conditions can be created at any time. a breach of covenant causes ownership to be forfeited. covenants are enforceable in court.

conditions can be created only at the time of transferring ownership.

The National Environmental Policy Act of 1969 requires developers of large projects to carry out a carbon footprint analysis. conduct an environmental impact survey. establish an environmental oversight committee. hire an environmental consultant.

conduct an environmental impact survey.

A house is constructed in a neighborhood that is substantially larger than the existing houses. Based on the value principle of ___________________, the larger house's value will therefore be adversely affected. anticipation conformity inadequacy competition

conformity

A contract that conveys an interest in real estate must contain a legal description of the property. be written on a form approved by the state bar association. be either nuncupative or holographic. be recorded within three days to be enforceable.

contain a legal description of the property.

One of the unique features of the Torrens System of recording is that conveyance occurs when it is registered on the certificate. it requires a complete title search to discover title status. title insurance is mandatory. encumbrances are recorded in order of priority.

conveyance occurs when it is registered on the certificate.

The level of government that actually levies real estate taxes is the federal. regional. state. county and local.

county and local.

When underwriting a mortgage loan a lender considers all of the following, except quality of the property that is being financed. creditworthiness of the buyer. quality of the title to the property being financed. creditworthiness of the seller.

creditworthiness of the seller.

Agent Mary sold a listing for another brokerage. Agent Mary is entitled to a selling side commission. listing side commission. shared listing side commission. finder's fee commission.

selling side commission.

An estate is transferred with the stipulation that alcohol will never be consumed on the premises or the seller will take back the property. This kind of estate is a fee simple absolute. pur autre vie. conventional remainder. fee simple defeasible.

fee simple defeasible.

The two documents that create a condominium are the declaration and by-laws. declaration and master deed. incorporation statement and management agreement. master deed and individual unit deeds.

declaration and master deed.

If a comparable has one more bedroom than the subject, an adjustment is made by adding value to the subject. deducting value from the subject. adding value to the comparable. deducting value from the comparable.

deducting value from the comparable.

The primary purpose of Truth in Lending is to _____________ control interest rates on behalf of the consumer. control the true costs to close a transaction. disclose the true costs of only an FHA loan. disclose the true costs of obtaining credit.

disclose the true costs of obtaining credit.

A millage rate is derived by dividing the tax requirement by the tax base. multiplying the tax base times the tax requirement. adding an inflation factor to the prior year's tax rate. dividing the tax base by the tax requirement.

dividing the tax requirement by the tax base.

A court orders Jerry to allow neighbor Loretta to drive across his property because it is the only way Loretta can reach her property from a public road. The easement created is an easement in gross. easement by prescription. easement by personal license. easement by necessity.

easement by necessity.

Market rent is also known as street value rent. economic rent. net rental rent. transferred rent.

economic rent.

An estate is transferred with the stipulation that trees on the premises will never be cut down or the seller will take back the property. This kind of estate is a fee simple defeasible. fee simple absolute. pur autre vie. conventional remainder.

fee simple defeasible.

"Real estate" includes such things as fences, sidewalks, and piers on a parcel of land. mobile homes temporarily parked on a parcel of land. timber that has been cut and is lying on a parcel of land. business equipment an owner or tenant has placed on a parcel of land.

fences, sidewalks, and piers on a parcel of land.

A property is secured by a mortgage that does not contain a "power of sale" clause. To foreclose, the lien holder will have to file a deficiency suit. file a foreclosure suit. obtain a deed in lieu of foreclosure. obtain a writ to extinguish the lien.

file a foreclosure suit.

To ensure that a proposed construction project will not have a negative impact on the environment, developers may be required to comply with the Minimum Property Standards code. obtain a building permit from HUD. file an environmental impact statement. hire a federal environmental engineer as project foreman.

file an environmental impact statement.

Which of the following is NOT one of the three classes of depreciation according to cause? physical deterioration. external obsolescence. financial deterioration. functional obsolescence.

financial deterioration.

In a foundation, the load is transmitted to the soil by the load exchanger. footings. platforms. lintels.

footings.

The broker changes his company address. He must phone the MREC notify the MREC by registered mail give the MREC written notice within 5 days give the MREC written notice within 10 days

give the MREC written notice within 10 days

The best practice is to have the buyers take possession on the day of the transaction close. have the buyers take possession at least 2 days after the day of the transaction close. have the seller remain on the property at least 2 days after the closing date. have the sellers move from the property at least 5 business days before the close date.

have the buyers take possession on the day of the transaction close.

Broker Carr has taken a listing from Seller Dole. Which is true? he must give him a copy at the time of signing he may send him a copy the next business day he must give him a copy within 3 business days he must give him a copy at the time of signing if requested by the seller

he must give him a copy at the time of signing

Broker Falk has a listing. Broker Carr found a buyer for Broker's Falk's listing. A salesperson could close the transaction if: he was under the direct supervision of the listing broker he was under the direct supervision of the manager or broker with whom the salesperson is associated he was under the direct supervision of a broker who was not his broker a salesperson cannot close a transaction, only a broker can close them

he was under the direct supervision of the manager or broker with whom the salesperson is associated

A salesperson licensed in another state but NOT in Missouri comes into Missouri and refers her brother to a real estate company in Missouri to assist him in the purchase of a home. The salesperson did this with the knowledge and permission of her broker, and the salesperson's broker cooperated with a Missouri broker in the sale of the property. What commission is she due? the full commission since she is licensed in another state half the commission since the other half would go to her company her commission would be based on her agreement with her broker no commission since she is NOT licensed in Missouri

her commission would be based on her agreement with her broker

When a broker closes his office, the salesperson must find a new broker. The broker who is closing the office and the salesperson must do all of the following EXCEPT the broker must notify the commission immediately that the salesperson will no longer be associated with him the broker is obligated to return the salesperson's license with the (office) closing statement to the MREC if the broker does not notify the MREC, then the salesperson can never transfer to a new broker the salesperson must return all property to the broker, including listings, forms, signs, etc.

if the broker does not notify the MREC, then the salesperson can never transfer to a new broker

If an individual broker's license is revoked or suspended, all of the following are true EXCEPT the broker must remove all advertising signs from all properties the broker must arrange for all pending contracts to close. The broker must notify the MREC who will handle the closing of these transactions the broker must notify the MREC where all the records will be stored for the term of the suspension if the broker's license is suspended, a salesperson can continue to operate the company until the suspension is over

if the broker's license is suspended, a salesperson can continue to operate the company until the suspension is over

Usury MOST nearly means ______________ making loans without the benefit of co-signors. lending money at fluctuating interest rates. being capable of multiple usages. illegal interest.

illegal interest.

When a lender requires tax and/or insurance amounts to be deposited with the lender by placing the monies in an escrow account, a "Budget Mortgage or Deed of Trust" occurs. These escrow accounts may also be referred to as impound or Reserve Accounts. compound or Reserve Accounts. insured or Restricted Accounts. interlocked and Restricted Accounts.

impound or Reserve Accounts.

The MREC, believing a licensee has violated the law, may file a complaint only in the U.S. District Court. only in the appeals court. only in a court of the county where the act was committed. in any court of competent jurisdiction.

in any court of competent jurisdiction.

To be valid and enforceable, a contract must include earnest money. be notarized. convey legal title. include valuable consideration.

include valuable consideration.

Participation in an MLS decreases the sales inventory available to licensees. allows a broker to list more properties. requires a broker to list fewer properties. increases the sales inventory available to licensees.

increases the sales inventory available to licensees.

The MREC, in investigating a licensee, may issue subpoenas for all records relevant to the complaint petition the attorney general for an injunction to keep the licensee from leaving the state make the licensee submit to a polygraph examination subpoena out of state residents who were involved in the transaction

issue subpoenas for all records relevant to the complaint

Which is TRUE regarding a broker's escrow account? it must be an insured account it must be in the state of Missouri it can be in any state as long as it is properly registered with the MREC it must be in an interest bearing account

it can be in any state as long as it is properly registered with the MREC

The critical characteristic of a Metes and Bounds description is that it conforms to the standards set for the plat of survey. it quantifies linear and area measurements. it describes the complete, closed perimeter of the parcel's boundaries. it describes an incomplete area of land.

it describes the complete, closed perimeter of the parcel's boundaries.

A parcel's street address is an insufficient legal description because street addresses do not contain a lot and block. it does not contain a POB. it lacks permanence and sufficient data for a surveyor to locate it. it creates a cloud on title.

it lacks permanence and sufficient data for a surveyor to locate it.

A new broker is considering opening his office in his home. Which of the following is true? he could only employ 2 salespersons it must be open to the public during regular business hours if he has salespersons licensed under him he could have the office in his home as long as he employs no more than four salespeople He could never employ salespeople while working out of his home

it must be open to the public during regular business hours if he has salespersons licensed under him

Buyer Jim put down a deposit in the form of a boat title worth $5,000. The boat is owned by Jim's parents. The transaction was not completed, whom should the boat title be returned to? Jim Jim's Parents The Title Company The agency that holds the escrow account

jim

A kind of trust that can only be used with real property is the estate in trust. testamentary trust. land trust. living trust.

land trust.

Unsophisticated investors should seek advice from only their broker as they know everything. advice from a stock broker before investing in real estate. legal and tax counsel before making any real estate investments. Never purchase investment real estate.

legal and tax counsel before making any real estate investments.

Someone who possesses all ownership interests in real property owns equitable title to the real property. legal title to the real property. equitable and legal title to the real property. statutory title to the real property.

legal title to the real property.

In a case of mortgage loan delinquency, it is the ______ that determines when foreclosure proceedings will commence. law lender borrower investors

lender

Both the buyer and the seller should have title insurance. broker should have title insurance. lender should have title insurance. escrow agent should have title insurance.

lender should have title insurance.

Chapter 339 of the Missouri Statutes is also known as: law of agency code of ethics license law administrative commission code

license law

The discount points charged by a lender on a federal VA or FHA loan are a percentage of the ________________ sale price. appraised price. loan amount. down payment.

loan amount.

The overall guideline for creating and enforcing zones, building codes, and development requirements is the enabling act. state environmental law. master plan. economic development statement.

master plan

Unlike a determinable estate, the grantor of a condition subsequent estate has no control over how the property is used. automatically retakes ownership if restrictions are violated. may repossess the property within a limited time frame if restrictions are violated. is limited in the kind of restrictions that can be placed on the grantee.

may repossess the property within a limited time frame if restrictions are violated.

Stan's home undergoes foreclosure. The property has the following liens recorded against it: an unpaid real estate tax bill for the current year; a first mortgage dated ten years earlier; a second mortgage dated three years earlier; and a mechanic's lien entered for work beginning six months earlier. When the property is sold, the LAST lien to be paid off is the property tax lien. first mortgage. mechanic's lien. second mortgage.

mechanic's lien.

Tom, the borrower, gave Joe, the lender, his mortgage as security for his loan. Under the terms of the mortgage, Tom is identified as the mortgagor. mortgagee. trustee. trustor.

mortgagor.

To receive a real estate license, which of the following is true? must be 18 years of age or older must be a citizen of the United States must be a citizen of North America must be a resident of Missouri

must be 18 years of age or older

If a subdivision has a restrictive covenant, it must be adhered to by all subdivision owners. is an ordinance set by the local zoning board. means that the properties cannot be rented. supersedes public policy or law.

must be adhered to by all subdivision owners.

Paul Shafer is acting as the agent of David Smith. He can agree to a change in price without Smith's approval. may share his commission with a licensed attorney. must report all offers to Smith. can make a profit in addition to his commission.

must report all offers to Smith.

In dealing with a potential customer, a salesperson may advertise a guaranteed profit on a property guarantee future profits which may result from the resale of real property both of the above neither of the above

neither of the above

Under what conditions might a broker hold an authorized disbursement of escrow moneys claim? Never To receive compensation from all parties To allow the escrow agent to move funds into an active account To allow the listing contract to expire

never

What is the legal requirement regarding the number of escrow accounts that can be opened? No limit One per transaction No more than 5 per quarter One per office licensee

no limit

A buyer asked Broker Carr to find a house for a flat fee of $5,000. The buyer and broker signed a buyer's agency agreement in which the buyer agreed to pay the $5,000 fee. Carr found a special home listed by Broker Baird. The buyer agreed to purchase the home. Broker Carr never mentioned anything about the buyer's agency agreement or the fee to the cooperating broker, nor was it disclosed in writing in the contract. Can Broker Carr retain the $5000 and share in the seller's commission with Baird? yes, since both brokers had agency agreements yes, because brokers can decide to split commissions as the brokers see fit no, it is illegal to receive commission from more than one party to a transaction no, as Broker Carr had not obtained written, prior permission from both the seller and buyer in the contract between the parties

no, as Broker Carr had not obtained written, prior permission from both the seller and buyer in the contract between the parties

On February 6, John Grant finished and passed a salesperson's pre-license class. On August 25, John passed the salesperson's examination. Can John receive a license? yes, because he took a pre-license course yes, because he passed a pre-license course no, because he did Not apply for license within 6 months of the date on his class certificate no, because he did Not apply for license within 60 days after passing the exam

no, because he did Not apply for license within 6 months of the date on his class certificate

A broker with one salesperson is retiring and moving to Florida to run a grocery store. He wants the salesperson to continue to have her job. Can he still do this? yes, but both he and the salesperson would have to get both Missouri and Florida licenses yes, as long as he retained his Missouri broker's license no, because he would NOT be in control of the salesperson's actions no, because his license is automatically terminated when he moves from the state

no, because he would NOT be in control of the salesperson's actions

An out of state owner calls a broker wanting to sell his property for $50,000. The broker knows that zoning has recently been changed and the property is now worth $75,000. The broker does not inform the seller. Is this legal? yes, as the broker bought it himself and did NOT put it on the market. yes, as the broker got the price the seller was asking no, the broker must inform the owner of the zoning and increased value no, the broker can NOT buy listed property as this would be a conflict of interest

no, the broker must inform the owner of the zoning and increased value

Jim and Larry who are not licensees form a company to deal in exchanges of property. After completion of a deal, the parties refuse to pay them a commission. Can they sue for the commission? yes, as they had performed according to the agreement yes, no license is required as the properties were exchanged rather than sold no, since the properties were exchanged no valuable consideration was given no, they were unlicensed; therefore, they were in violation of state license law

no, they were unlicensed; therefore, they were in violation of state license law

Conventional mortgage loans are guaranteed by a government agency. insured by a government agency. guaranteed by private insurance. not guaranteed or insured by any government agency.

not guaranteed or insured by any government agency.

If the MREC denies a salesperson's license to any applicant, the Commission must do all of the following except notify the applicant, in writing, stating the reasons for the denial of licensure. inform the applicant, in writing, of his right to file an appeal with the AHC. notify the applicant of this denial within ten (10) days of receipt of license application. send all notifications by certified mail.

notify the applicant of this denial within ten (10) days of receipt of license application.

Parties can agree to replace a cancelled contract with another contract by the process of subordination. assignment. novation. rescission.

novation.

An adhesion contract binds parties who have contracted with each other repeatedly. establishes terms of the agreement between an employer and a contract employee. imposes exclusivity on both parties. offers one party only the option of accepting or rejecting the contract.

offers one party only the option of accepting or rejecting the contract.

The property manager must make a written statement of property income to the owners of rental properties how often? once a week once a month once every six months once a year

once a year

Bob can grant his sister Mary an estate for as long as she lives without the right to pass it to heirs by granting a(n) ordinary life estate. estate for years. legal life estate. estate pur autre vie.

ordinary life estate.

A mortgage in which the lender participates in the income of the mortgaged property beyond a fixed return is called participation financing. coop-purchase money mortgaging (CMM). wraparound financing. co-underwriting mortgage partnering.

participation financing.

When a joint tenant dies, that tenant's interest passes to the surviving joint tenants. passes to the decedent's heirs as a tenancy in common. passes to the decedent's heirs and the surviving tenants as a divided tenancy in common. passes to the decedent's heirs as a joint tenancy.

passes to the surviving joint tenants.

Jamie Jones tried to renew his license, but he failed to complete the continuing education requirements. Three months later Jamie wanted to reinstate his license. Jamie would have to do which of the following? pay a late fee of $150 only pay a late fee and take the continuing education he had missed pay a late fee, take the pre-license class and pass the real estate test pay a late fee of $50 a month not to exceed $200, and take the Missouri Practices course.

pay a late fee of $50 a month not to exceed $200, and take the Missouri Practices course.

A general lien is a lien imposed by statutory law. imposed by court order. placed against an individual rather than against any particular property. placed against any and all property owned by an individual.

placed against any and all property owned by an individual.

Of the wood framing systems used in residential construction today, the most common is platform-frame. balloon-frame. pillar and girder. post and beam.

platform-frame.

All of the following are elements in the Recorded Plat system of description EXCEPT lot numbers. block numbers. meridian reference. point of beginning.

point of beginning

A strict foreclosure begins with a writ of execution. an appeal to a court. surrender of the deed. proper notice to the delinquent borrower.

proper notice to the delinquent borrower.

Property briefs are also called property notes. cheat sheets. property flyers. house information pads.

property flyers.

A licensed broker acting as a property manager deposits current rental money into a(n): property management escrow account business account management account escrow account

property management escrow account

If an owner gave a broker money for repairs on a rental property, where should the broker deposit the money? property management escrow account property management repair account broker's escrow account broker's operating account

property management escrow account

The primary agents of private land use control are courts by means of police power. property owners by means of zoning ordinances. property owners by means of deed restrictions. grantees by means of restrictive covenants.

property owners by means of deed restrictions.

The owner of a cooperative owns a(n) proprietary lease. estate for years. commercial lease. periodic lease.

proprietary lease.

The primary purpose of the secondary mortgage market is to improve employment in the construction industry. provide low-cost mortgages to consumers. provide liquidity (funds) for the primary market. regulate the interest rates on residential mortgages.

provide liquidity (funds) for the primary market.

The Equal Credit Opportunity Act prohibits lenders from discriminating against consumers in the granting of credit based on the following protected classes; race, income, religion, national origin, sex, marital status, age or dependency on public assistance. race, color, religion, national origin, sex, marital status, age or dependency on public assistance. race, national origin, age or dependency on public assistance. race, color, religion, national origin, sex, or dependency on public assistance.

race, color, religion, national origin, sex, marital status, age or dependency on public assistance.

Which of the following areas in the Rectangular Survey System run north and south? Base Range Township Section

range

Owning a building typically increases marketing abilities for the company. allows better market share of the business. reduces the flexibility of the business. increases the flexibility of the business.

reduces the flexibility of the business.

The fundamental components of the Metes and Bounds system are parallels, base lines, and meridians. boundaries, distances, and a base line. reference points, angles, and distances. lot numbers, sections, and ranges.

reference points, angles, and distances.

One limitation on deed restrictions is that they may not prohibit commercial activities. prohibit construction of buildings. require minimum setbacks. restrict ownership on the basis of race or religion.

restrict ownership on the basis of race or religion.

Assets include all of the following, except revolving and installment loan accounts. liquid savings, checking, CD's. personal property. real estate.

revolving and installment loan accounts.

Except in a title-theory state, a mortgage lienor has a (an) _________ in the liened property. security interest an equitable interest a pro rata share of a legal interest a dominant interest

security interest

The cost of points is not deducted from the loan. Points are treated as a separate credit on a settlement statement, charged to the party who has agreed to pay them. proration on the settlement statement. credit to the borrower and a debit to the seller. separate debit or charge on a settlement statement, charged to the party who has agreed to pay them.

separate debit or charge on a settlement statement, charged to the party who has agreed to pay them.

In a tenancy in common, the co-owners are necessarily married. own equal shares of the estate. share an indivisible interest. acquire their interests at the same time.

share an indivisible interest.

Work agreements should be individualized. should be signed by all parties and a witness. should be standardized. should be notarized and a copy sent to the Real Estate Board office.

should be standardized.

A property manager working for more than one owner should have a real estate license. does not need a real estate license. should have a mortgage broker's license. is illegal under state law.

should have a real estate license.

When a listing agent signs an agreement, in reality, he or she is signing on behalf of a cooperating broker. signing on behalf of all licensees in the company. signing on behalf of all other MLS licensees. signing on behalf of the indicated broker.

signing on behalf of the indicated broker.

The Truth in Lending laws apply to the financing of single family residences. industrial plants. multi-family housing projects over 25 units. business assets.

single family residences.

As part of the assessment process, taxing entities sometimes use an equalization process to adjust millage rates within the district to ensure fairness. modify the tax rate from one neighborhood to the next. ensure that property owners have nearly equal tax bills. smooth out wide discrepancies of assessed values within the district.

smooth out wide discrepancies of assessed values within the district.

Licensee Jones only shows minority buyers homes located on the east side of town. This is an example of directing. steering. grouping. slanting.

steering

A court orders transfer of a mortgaged property to the lender in a ___________ foreclosure. possessory judicial no-fault strict

strict

A lien holder can change the priority of a junior lien by agreeing to change the date of recording. lower the amount of the claim. vacate the lien. subordinate the lien.

subordinate the lien.

An agreement to waive prior rights in favor of another is called subordination. alienation. subrogation. acceleration.

subordination

A complaint has been filed against Broker Grant. The MREC has the power to: subpoena Broker Grant and his business records subpoena Broker Grant's personal accounts fine Broker Grant subpoena anyone in any state the commission chooses

subpoena Broker Grant and his business records

If a manufacturing plant that employs 20% of the local labor force closes, the likely effect on the area's real estate values will reflect the principle of supply and demand. transferability. substitution. highest and best use.

supply and demand.

An unlicensed secretary is the only one in a residential real estate office when Broker Carr from another company calls requesting information on a property. The secretary may: give him the sale price and address take his name and have a licensee return the call give any information necessary since it is another broker and not a member of the general public mail the broker information

take his name and have a licensee return the call

Restrictive covenants can never be changed or removed. are never used for residential properties. take priority over less restrictive zoning ordinances. may be discriminatory if established before ownership transfers.

take priority over less restrictive zoning ordinances.

Special assessment tax liens are general liens. are paid on a monthly basis. take priority over mechanic's liens. cannot be prepaid in full without penalty.

take priority over mechanic's liens.

An unconscionable contract is one that illegal in purpose. gives one party only the option of accepting or rejecting the contract. is triggered by unforeseeable, random events. takes unfair advantage of the party with weaker bargaining power.

takes unfair advantage of the party with weaker bargaining power.

The Federal Reserve controls lenders by telling lenders what percentage of their assets they can loan. telling lenders what interest rates they can charge. telling lenders how many loans they can make. having a pool of money from which the lenders can make loans.

telling lenders what percentage of their assets they can loan.

The most common form of co-ownership when the owners are not married is tenancy in common. joint tenancy. tenancy by the entireties. tenancy in partnership.

tenancy in common.

A broker dies, and his company is placed in receivership. all sales contracts are canceled by the death of the broker the MREC can appoint a "receiver" to handle the existing sales contracts the MREC can appoint a temporary broker to finish the existing sales contracts

the MREC can appoint a temporary broker to finish the existing sales contracts

A citizen phoned the MREC with a complaint on a licensee. The MREC sent him a form to fill out. However, he never followed up with the complaint in writing. What would the MREC do? the MREC must follow up on an oral complaint the MREC can NOT act on an oral complaint the MREC must ignore the complaint the MREC can investigate on its own volition

the MREC can investigate on its own volition

A salesperson told a buyer that the air conditioner would stay with the house. However, he had not checked it with the seller. After closing the seller took the air conditioner. Which would happen? the salesperson would have to pay for the air conditioner the MREC would automatically revoke his license the MREC can take disciplinary action the buyer would have to look to the seller for action

the MREC can take disciplinary action

Two brokers got into a dispute over who was due what part of a commission. One of the brokers filed a complaint with the MREC to get it settled. Which is true? the MREC will settle the dispute at the next monthly meeting. the MREC will make recommendations as to who should get the commission but will NOT make the final decision the MREC may revoke the license of the broker who withheld the commission falsely the MREC will NOT enter into any dispute over commissions between licensees.

the MREC will NOT enter into any dispute over commissions between licensees.

The authorities are investigating a violation of the law by a licensee. Which could happen? the Administrative Hearing Commission could revoke or suspend his license the Missouri Real Estate Commission could revoke or suspend his license the Missouri Real Estate Commission could impose criminal penalties the Administrative Hearing Commission could impose criminal penalties

the Missouri Real Estate Commission could revoke or suspend his license

The Environmental Protection Agency was created by the Superfund Act. the Resource Recovery Act. the Water Quality Improvement Act. the National environmental Policy Act.

the National environmental Policy Act.

The individual right to own land is guaranteed by police power. the U.S. Constitution. federal regulations. state law.

the U.S. Constitution.

One of the negative features of foreclosure for the borrower is the borrower's credit is damaged, making it difficult to purchase another home. the borrower loses any right to seek another mortgage for seven years. the borrower loses all equity, even if the sale yields more than the amount owed. the process happens so quickly that the borrower has no time to cure the problem.

the borrower's credit is damaged, making it difficult to purchase another home.

In the event of a dispute over earnest money the broker should release the money to whomever the contract calls for the broker should release the money to the seller due to the fiduciary situation the broker should hold the money until both parties sign a release the broker should hold the money until all parties to the contract sign a release, or within 365 days if the parties cannot come to terms, release the monies to the State Treasury.

the broker should hold the money until all parties to the contract sign a release, or within 365 days if the parties cannot come to terms, release the monies to the State Treasury.

If the MREC receives a complaint against a broker, they could subpoena: past clients and customers from out of state the broker's business and personal records people from out of state the broker's business accounts and records

the broker's business accounts and records

Plumbing fixtures in a building have a minimum and maximum pressure requirement that is dictated by the plumbing contractor. the water company. the building code. zoning.

the building code.

When Susan listed a home for the Smiths, she was told by the sellers that the lot measured 75' x 150'. Susan told the buyers this information and the house sold. After taking possession, the buyers had the lot surveyed and discovered that the lot was only 75' x 130'. Which best describes this situation? Susan was in no way responsible as she was acting as an agent for the principal the buyers may sue Susan and her broker for damages if the MREC learns of this they will automatically revoke Susan's license the AHC can suspend or revoke Susan's license if they feel she should have been more careful

the buyers may sue Susan and her broker for damages

When an appraiser makes a site analysis on residential property, the appraiser would be concerned with all of the following EXCEPT how far back the house sits from the street. whether the neighbor's fence encroaches the property line. the amount of mature trees and shrubs on the lot. the cost to replace the building.

the cost to replace the building.

When no legal heirs can be found for the deceased owner of a property, the laws of descent give the property to the winning bidder in a sheriff's sale. the county or state. the heirs of the previous owner of record. a registered charity in the nearest municipality.

the county or state.

Any change to a listing agreement or other written authorization must contain a notary seal the signatures of two impartial witnesses the initials or signatures of all parties a full documentation of the reason(s) for the change(s)

the initials or signatures of all parties

The owner of a condominium unit is responsible for maintaining hallways, corridors, and stairwells that provide access to the unit. all common elements on a rotating basis. structural components that support the unit's part of the building. the internal systems of the unit.

the internal systems of the unit.

The period of delinquency allowed before a lender begins foreclosure proceedings is determined by statute. the secondary mortgage market. investors. the lender.

the lender.

Regulation Z is not concerned with the disclosure of loan cost information to a consumer. the loan to value ratio the annual percentage rate. finance charges.

the loan to value ratio

Tax rate is calculated based on the local tax requirements and the tax base. the assessment of the property. a flat tax amount approved by the local taxing authority. a tax rate approved by the state legislature.

the local tax requirements and the tax base.

An appraiser is looking for the growth, stability, change and decline of an area. The appraiser is dealing with the neighborhood cycle. site analysis. economic obsolescence. the community cycle.

the neighborhood cycle.

A written complaint had been filed against a salesperson. However, the salesperson was in the process of transferring to another broker. Which of the following is TRUE regarding the situation? the new broker would usually be notified by the Real Estate Commission (MREC) of the fact that a complaint is pending the salesperson must wait 60 days to transfer to another company the salesperson must wait 45 days to transfer to another company the complainant would get a written record of the salesperson's answer to the complaint

the new broker would usually be notified by the Real Estate Commission (MREC) of the fact that a complaint is pending

If a joint tenant sells his or her interest to an outside party, the new owner becomes a joint tenant. the new owner is a tenant in common. the joint tenancy terminates and all owners become tenants in common. the joint tenancy terminates and the owners must create a new joint tenancy to include the new owner.

the new owner is a tenant in common.

Persons with which of the following qualifications may apply for a broker's license? the sponsoring broker states that the salesperson has been active for 12 months the person has completed an approved course and has passed the state's examination and has been an active salesperson for at least two years. the person had 10 listings and 4 sales anyone who has been licensed 6 months and pays the fee

the person has completed an approved course and has passed the state's examination and has been an active salesperson for at least two years.

The slope of the roof is also known as the angle. the sheath. the pitch. the ridge beam.

the pitch.

Which must be licensed by the Missouri Real Estate Commission? the publisher of a magazine to aid "for sale by owners " in selling their homes a lake property developer registered with HUD an employee of a corporation selling corporate property an apartment manager representing the owner who shows rental units

the publisher of a magazine to aid "for sale by owners " in selling their homes

The capitalization rate is best described as: the value of the property in relation to the gross income the property produces. an investment property's fixed cash flow on an annual basis. the relationship between net operating income and estimated value or cost. a fixed rate of return for the investor of a commercial property.

the relationship between net operating income and estimated value or cost.

When a contract is revoked, the non-revoking party has no legal recourse but to accept the revocation. both parties must agree for the revocation to take effect. neither party has any further obligations. the revoking party may still have obligations to the other party.

the revoking party may still have obligations to the other party.

The legal description of a recorded plat is incomplete if it lacks a point of beginning and ending. the subdivision's location in a section and township. a calculation of each lot's acreage. a description of landmarks.

the subdivision's location in a section and township.

A VA loan may be granted for the purchase of a one-family to four-family if _________________ the veteran certifies the rent collected will equal the mortgage payments. the loan will be amortized for not more than 20 years. the down payment will be at least ten percent. the veteran agrees to live there.

the veteran agrees to live there.

In contrast to a tenancy in common, in a joint tenancy there is a single title to the property. there are as many titles to the property as there are co-owners. title is held by a corporate entity. co-owners who are married hold separate titles.

there is a single title to the property.

Testamentary trusts are distinct from other kinds of trust in that they begin and end at specified times. they may be changed at any time. they may be used for real and personal property. they may name a bank or trust company as trustee.

they begin and end at specified times.

A motel desk clerk gives the names of persons looking to purchase a home who are moving into town to a salesperson friend in exchange for a referral fee. Which BEST describes the situation? they would NOT need a license since their primary income comes from their salary they had a license, they could accept referral fees from the salesperson they would need a license and would only be able to accept compensation from their broker they could accept compensation without a license as long as it was not in money form

they would need a license and would only be able to accept compensation from their broker

One characteristic of a Planned Unit Development is to cluster homes in smaller lots to allow for more common area. to enact enabling restrictions to maintain maximum market value. to encourage maximum lot sizes to enhance highest and best use. to maximize zero lot lines, party walls, and land use restrictions.

to cluster homes in smaller lots to allow for more common area.

The purpose of a homestead tax exemption is to exempt qualified property owners from ad valorem taxation. to offer an amount of tax relief on an owner's principal residence to encourage multiple property investment. to exempt owners of principal residences who rent their properties.

to offer an amount of tax relief on an owner's principal residence

A management agreement between a property manager and an owner must include all of the following EXCEPT identification of the property specify the terms and conditions on which the broker will remit income from the property specify whether security deposits will be held by the broker or the owner today's date

today's date

A broker desires to keep an escrow account in an interest bearing checking account. Would this be legal? yes, if both buyer and seller agree in writing that it goes into an interest-bearing escrow account yes, if the buyer agrees in writing that the buyer's funds may go into an interest-bearing escrow account yes, if the seller agrees in writing that the seller's future funds go into an interest-bearing escrow account yes, if all parties to the transaction agree, in writing, that the money is to go into an interest-bearing account and who is to receive the interest

yes, if all parties to the transaction agree, in writing, that the money is to go into an interest-bearing account and who is to receive the interest

The MREC has heard rumors that a broker is violating the law. Can the MREC investigate? yes, but they are limited in the investigation of the incident that sparked the rumors yes, no complaint is necessary for the MREC to investigate no, because there has not been any allegation of criminal conduct no, because there has not been a complaint filed by either a licensee or the public

yes, no complaint is necessary for the MREC to investigate

A person owned her own company specializing in negotiating sales for buyers and sellers. She had incorporated her business but does not get listings or sell properties. Does she need a real estate license to do this? no, she does NOT need a license because she was not listing property no, she does not need a license because she was not selling property yes, she would need a broker-officer's license and her corporation would need a broker's license yes, she needs a broker's license, but her corporation is exempt since it will not list or sell property

yes, she would need a broker-officer's license and her corporation would need a broker's license

Salesperson Baird was born in Finland. He moved to Missouri, went to a prelicense school, took the test, passed and was licensed under a broker. He then sold a property. Would Baird be eligible for a commission? yes, since he passed the test yes, since he fulfilled the legal requirements of the law no, because he was not a citizen no, since he was born in Finland

yes, since he fulfilled the legal requirements of the law

A salesperson pre-qualified a buyer and took personal information at that time. The salesperson then showed a buyer several homes. Prior to showing the homes, the salesperson had the buyer sign an agency disclosure form. Did the salesperson do anything wrong? yes, the salesperson should never show a house without qualifying the buyer yes, the salesperson should have disclosed his/her agency relationship prior to taking personal information no, the salesperson disclosed his agency prior to showing any properties no, the salesperson should disclose agency only if asked

yes, the salesperson should have disclosed his/her agency relationship prior to taking personal information

In applying for a real estate license you must make 70% on the state examination you must complete a sales training course you must enclose the license fee as a cashier's check, money order, or personal check you may apply for the broker's license before passing the salesperson's exam

you must enclose the license fee as a cashier's check, money order, or personal check

Which is true of license forms? you will be sent a renewal notice by certified mail if you do NOT receive a renewal notice, you will receive a 30 day grace period you must send in the appropriate application and renewal fee renewal is automatic unless you are notified

you must send in the appropriate application and renewal fee