Real Estate Express - Practice Exam 2

The continuing education requirement in California is ____________hours every __________ years.

45, four

What is the California Statute of Limitations on bringing a court foreclosure to enforce a mechanic's lien? To bring action for removal of encroachments?

90 days after filing the lien; Three years

Caroline has been paying her mortgage steadily for fifteen years. She has just received a notice from her lender that the loan due date is approaching and she will owe a lump sum of $11,257 to pay off her mortgage loan. Which type of promissory note has Caroline NOT been paying?

A fully amortized loan

Agent Green is faced with an ethical dilemma. He was present when two brokers were having an unethical discussion that could be considered collusion. He doesn't know if he should act as if it never happened, or report the incident to his broker. What steps should he employ when making this decision?

All of the Above

Which of following are not considered trust funds?

All of the Above

Which is not a form of syndication?

An Equity Trust

Agent Simpson tells residents of a neighborhood that minorities are moving into the neighborhood, and property values are sure to plummet. Simpson goes on to say, "resale values will suffer, the neighborhood will deteriorate, and if they don't sell their homes now, they will lose money." What form of illegal discrimination is Agent Simpson practicing?

Blockbusting

Ramon did not pass his licensing examination. He didn't think it was a possibility to fail and doesn't know what to do to re-take the test. Ramon is not even sure he is allowed to take the examination a second time. What are Ramon's options?

Both A and B

Agent Peters has qualified buyers to purchase a new home. Now he needs to qualify the property they wish to buy. He understands the human qualification process. Can you help Agent Peters with steps to qualify the property?

Both A and C

In studying for her real estate license, Elise is reading about police power. She is confused and doesn't understand why law enforcement would have any role in real estate sales, transactions, and regulations. What does the term "police power" refer to in real estate? The

Both A and C

When can a violation that hasn't happened yet be a violation?

Both A and C

What is the difference between Southern California and Northern California in reference to escrow accounts?

Both B and C

Which of the following statements concerning real and personal property is true?

Both B and C

Appraiser Jones appraises one-to-four unit residential properties, and non-residential properties with a transaction value up to $250,000. What is this appraiser's level? How many hours of appraiser education were completed?

Certified Residential Real Estate Appraiser, 200 hours

Which act is known as the original fair housing statute?

Civil Rights Act of 1866

What are the types of legal life estates?

Dower, a wife's interest in the husband's property; Curtesy, a husband's interest in a wife's property; and Homestead, protection against unsecured debts for the party who did not sign for the loan.

Judy is the listing agent for the Brandts' home. In the inspection of their home, she discovers a few issues of concern. The basement is very damp and smells of mildew. Judy noticed what appeared to be mold on the interior walls of the lower level. She also saw what she believed to be their main line overflowing in the utility area of the basement. State the case that is responsible for broker's conducting a diligent inspection of properties they are listing or selling.

Easton v. Strassburger

Mr. Manning has owned a restaurant for forty years. He is in the process of selling his business to a group of investors who plan on revamping the restaurant and turning it into a destination. In the negotiation of the sale, Mr. Manning has stipulated he is willing to accept their offer on two conditions: There may never be any alcohol served on the property and there can never be dancing of any kind. Mr. Manning is insistent on these conditions due to his religious beliefs. If either of these activities ever takes place, Mr. Manning would have the right to take back the property. Which type of estate applies?

Fee Simple Defeasible

Georgina sat for the examination about two weeks ago. She believes she passed with flying colors and checks her mail immediately upon arrival home for her results. Today, they arrived and, as she opened the envelope, she saw her test score. Did Georgina pass or fail?

Georgina failed the exam. The exam is qualifying by nature and if you pass, you pass; your score is irrelevant and is not revealed.

Patrice and Cornell are completing a sales contract with Mary, their agent. The sales contract used at Mary's brokerage is preprinted. Mary, as a senior agent, has the authority to waive one of the brokerage's fees. The fee is explained and preprinted on the contract. Mary simply crosses it out, writes "waived," and both parties initial. Which overrules the other? The preprinted or handwritten portions of the contract?

Handwritten portions of real estate contracts always supersede preprinted forms.

When is a real estate licensee considered a creditor?

If the licensee routinely assists sellers in determining whether a proposed buyer in a land contract or purchase-money mortgage is creditworthy.

Which of the following is not an exemption to the federal fair housing laws concerning age and family status?

In a retirement community if 70% of the dwellings have one person who is 55 years of age or older, provided there are amenities for elderly residents.

Which of the following liens is both general, involuntary, and statutory? Which lien is specific, voluntary, and equitable?

Income Tax Lien; Mortgage Lien

XYZ Corporation is interested in a piece of land for development. They are selling off a bit of company stock to buy the property without any debt. Is XYZ's sale of stock considered a form of financing?

It is actually considered a mortgage financing alternative.

A subdivision has a homeowner association rule that states there can be no above ground pools in the subdivision. The Curtis family has an above ground pool in their backyard. Four years later, the new association president threatens to take the family to court for violating the subdivision regulations. Why doesn't the new president have a case?

Statute of Limitations

Broker Burns is negotiating a first trust deed loan for buyers. The buyers have signed a contract for a fifteen-year loan. What is the maximum commission for Broker Burns?

Ten percent of the principal of the loan.

Which of the following conditions does not apply in converting a mobile home into real property?

The homeowner is required to have a tag guaranteeing the mobile home's proper construction.

Along a non-navigable stream, does an owner own the land, the water, both, neither? What is this right?

The owner owns the land to the center of the stream and the government owns the water. It is a Riparian Right.

When an owner dies without a will or heirs, what happens to the property and why?

The property is transferred to the state. Property cannot be without an owner.

The Brights are buying a home from the Stones. They are splitting the escrow service fees 50-50. Do they live in Northern or Southern California? How does the other region usually handle the escrow service fees?

They live in Southern California. In Northern California the buyer usually pays the escrow service fees.

Which of the following is not a prohibited escrow-related activity?

They may not permit, under any condition, any person to make any addition, deletion, or alteration of an escrow instruction.

Ben and Amanda are interested in a vacant, undeveloped lot. They are going to continue to live in their current home, pay off the lot's loan, and then build a new home on the lot. Before closing on the purchase of the lot, they discover the zoning regulations permit nightclubs to be built in the immediate area. They specifically asked the broker about this issue and were told there was no reason to worry. What are Ben and Amanda's options, if any?

They may rescind the transaction based on the misrepresentation of the broker.

An undeveloped acre of land sits in the middle of a secluded rural community. How many separate owners could this acre have?

Three owners: One could own the subsurface rights, one the surface rights, and another the air rights.

Ensuring consumers are fully informed of all finance changes and aware of the true annual interest rate are requirements of which regulation?

Truth in Lending

Which of the following is not a fourfold unity?

Vesting

Tracy and Darnell are buying a home. They have a 15% down payment and have qualified for a thirty year fixed rate mortgage. Will Tracy and Darnell have to pay PMI?

Yes, private mortgage insurance is required for all loans with less than 20% down payment.

Kim, Chris, and Beth are all partners in a cosmetics firm. Kim is leaving the partnership and wants to sell her shares of the business, including the property owned by the partnership, to Chris and Beth. The three partners own the property with the right of survivorship should one or more of them die. The remaining partners are not interested in buying Kim's interests. Kim has been unable to find a buyer for her share of the partnership. She has now resorted to asking the court to either sell her shares or sell the entire property. What form of concurrent ownership applies?

Joint Tenancy

Ken has just passed his licensing examination. However, he has been notified the CalBRE will not issue a full-term license. Ken is behind on child support payments and therefore has not complied with a court order to provide these payments. Will Ken ever be able to obtain his license?

Ken may be issued a 150-day temporary license while he is on the list of child support obligors. Only one 150-day temporary license may be issued. His full-term license may be issued if a release is obtained from the district attorney's office during the 150-day temporary period.

Which are the four elements required for a valid contract?

Legally Competent Parties; Offer and Acceptance; Consideration; and Legality of Object

Christina is planning on getting married in the next year. She is a very successful business owner and is planning on buying some vacation property on the coast. She asks her agent, Martina, for advice on how she should take title to this new property. Should she hold the title alone, or jointly with her fiance? How should Martina advise?

Martina should discuss with Christina what she knows in reference to California community property laws, but give no advice except to consult an attorney for advice.

Dan has recently been transferred to San Diego, and only has a month to find a home, sell his condo, pack, move, close, and get to work. His agent shows him the Walsh home and it's perfect. He offers the asking price, along with all the kitchen appliances and window treatments to remain with the property. The Walsh's accept his offer exactly as it is written. Which contract term applies to this situation?

Mirror Image

Elliot has misrepresented himself by acting in the capacity of a real estate salesperson without being licensed by the State of California. Elliot had his license revoked three years ago for unethical actions. Elliot is guilty of what level of violation?

Misdemeanor

What is the form of all California licensing examinations?

Multiple-Choice Tests

Due to the subdividing of lots on the lake, Jim's property is surrounded on three sides by Louise's property. The only other boundary is the lake. Jim can only get to his home by driving up Andrea's driveway and behind her lake home to get to his own. How was the easement in this situation created?

Necessity

Which of the following listing agreements is illegal in most states?

Net Listing

Deanna is buying one of Kay's fur coats and several handbags. They are old friends and sometimes purchase each other's items instead of selling to a consignment shop. Deanna agrees to pay Kay $650.00 for the items, writes a check, and collects her purchased items. Is this transaction legitimate?

No, in the State of California, an agreement for the sale of personal property must be in writing if the amount or value of the property exceeds $500.00.

John and Thom are purchasing their dream home. Due to the expiration of escrow instructions, the escrow has been terminated. Have they lost the contract on the house of their dreams?

No, the termination of an escrow does not terminate the associated contract.

Molly, a successful real estate salesperson, took some time off to stay at home with her first child. Days turned into weeks, weeks into months, months into years, until Molly's child was starting school. She decided she needed to head back to her profession and pick up where she left off. During her at-home time, Molly hadn't kept up with any CE requirements, nor had she renewed her license after its expiration almost three years earlier. Can Molly simply pick up where she left off?

No, two years after the license expires, all license rights lapse. Molly must re-qualify through the examination process before being licensed in real estate once again.

Agent Sims needs one more new home sale this month to receive a bonus. She has one more that could possibly close and help her meet the goal. However, today she was informed the financing fell through for the buyer. Agent Sims has a lender friend that owes her a favor. She calls the lender, offers the friend one-quarter of her bonus if he will finance the buyers who were turned down. Which penal code section addresses this crime?

PC 639-639a

Carol is studying for the California real estate license examination. She knows she has to know all areas covered in the examination extremely well to pass. Which portion of the examination, approximately, makes up the largest portion of the test?

Practice of Real Estate and Mandated Disclosures