Record keeping and Retention in Oregon

Millie and Gary are searching for a home in a great school district. If the public school isn't highly rated, then options such as charter schools and private schools should be plentiful. Some states don't include school district information on the seller disclosure form, so how might they learn about school options?

Neighborhood website

Which one of the following statements about asbestos is true?

No amount of it is considered safe.

Once handed over, trust funds belong to the ______ until the transaction for which they were designated has been completed, or they're disbursed according to the agreement between the parties.

Party who submitted them

A closing agent has several duties to perform both before and after the closing. Which of the following is a task the closing agent must complete after the closing?

Pay the existing loan off

What can water damage on a ceiling or wall indicate?

Plumbing issues

Trust funds have better protection when deposited into trust accounts because they are ______.

Protected from seizure

Which of these is the lender's attorney's responsibility at the closing?

Reviewing the appraisal, survey, and inspection reports

Greta is working with agent Brandon to sell some property. Nelson represents the buyer, Rigby. Of these four parties, who will pay the earnest money?

Rigby

Rachel just sold her home and paid $18,427 in closing costs. Her brokerage fee, which is included in that figure, was 6%. She netted $230,063. What were her non-brokerage fee-related closing costs? Round to the nearest dollar.

$3,518

Which of the following is an example of an easement?

A path providing neighborhood access to a pond cuts through part of Hillary's property.

By accepting and depositing earnest money funds, Lucas, an Oregon principal broker, is agreeing to ______.

Abide by Oregon license law related to trust funds

Which of the following provides a summary of the title history?

Abstract of title

Which of the following is more likely to act as a closing agent?

An attorney or title company representative

Shane's buyers learned during the inspection that there was water damage around the fireplace and that the chimney needed new flashing and to be repointed. To whom must Shane disclose that information?

Any party to the transaction

In states where full disclosure isn't required, it's the ______ responsibility to perform due diligence on the property.

Buyer's

Who at the closing table examines all documents for buyers or sellers and represents their best interests?

Buyer's or seller's attorney

Lucy, a newly licensed Oregon broker, learned in her broker course that she's required to keep ample records. Her first solo transaction is as a buyer's agent, so she starts a file for everything that she thinks will be important for her client: every scrap of paper that will directly affect whether her client's purchase goes through. When her principal broker wants to check her progress, Lucy's worried she's missing some items from her transaction file. What might Lucy be missing?

She is missing any other documents generated during the professional relationship. She's required to keep everything generated during real estate activity.

Eleanor is working as a buyer's agent for Luis in a state without full disclosure requirements. What is her responsibility relative to property disclosures?

She must obtain the disclosures, provide them to Luis, and review them with him.

Principal broker Danny tells his associate broker Lucy to make sure that the e-files she creates for her transaction files are secure in order to maintain compliance with Oregon real estate laws. What does he mean?

She uses an electronic storage device in which information, once written, cannot be modified.

Trust account records can be stored at a branch office when the related transaction originated with a licensee at that office. Which of the following is NOT part of the trust account records?

Social Security numbers of involved parties

______ is a Latin term that means "let the buyer beware."

Caveat emptor

Which of the following could be an indication of a foundation problem?

Crack in a basement wall

What gets recorded and serves as public notice of ownership?

Deed

Discoloration along walls and sagging or uneven floors can be signs of ______.

Flood damage

What could discolored soil, soft spots, or mounds on the land indicate?

Former waste disposal site

Your client, Risa, is about to attend her first closing. Which of these activities can she expect to occur on the day of closing?

Her loan funds will be transferred.

Georgina is an escrow agent who's holding funds for several transactions. Which of these statements about how she'll disburse these funds is true?

If the transaction doesn't close, Georgina will disburse the earnest money as instructed by the parties or according to state law.

Where are underground storage tanks primarily found?

In older homes and former industrial sites

What does "caveat emptor" mean?

Let the buyer beware

Marlon and Leah are interested in buying a home in a new homeowner opportunity area. The 100-year-old row house was renovated and is like new on the inside. The property taxes decreased by more than $5,000 last year. What's the likely reason for this?

Tax abatement

Most often, what's the first course of action for disputed home warranty claims?

Mediation

How often should accounting records for trust fund accounts be reconciled?

Monthly

You're a principal broker in Oregon. That means you must reconcile your trust fund accounts ______.

Monthly

Home inspector Maura was walking Thad through a property inspection. The frame house, on a slab foundation, had mulch piled up about 18 inches next to the house. Why was Maura noting this as a concern?

Mulch next to wood siding may lead to wood rot.

When a buyer finances a newly built home with a Federal Housing Administration loan, what does the FHA require the builder to do?

Purchase a third-party home warranty to protect the buyer

What cancer-causing substance is naturally created when the gas in rocks and soil decays?

Radon

Debra's listing agent, Raj, just called to tell her that he'd received an offer on her house and an earnest money check for $4,500. "I'm on my way over to go through the offer with you. I think you'll like it!" Debra's excited, and she knows exactly what she wants to spend that $4,500 on. What's wrong with Debra's thought process?

The earnest money doesn't belong to Debra. It will be held in an escrow account.

What is the lender's attorney's responsibility at the closing?

Review the appraisal, survey, and inspection reports

Real estate brokers in the state of Oregon are allowed to keep electronic records, when ______.

The files are secure and accessible, backed up once per month, and kept for two months

Which of these could be signs of flood damage?

Soft or uneven floors

Stan is a home inspector who's evaluating a home for potential buyers. He pointed out that neither of the two bathrooms had vent fans installed. Why is this a potential problem that will be noted on the inspection report?

The lack of air circulation in a moist room can lead to mold growth.

Who's generally responsible for ordering and reviewing a survey of the property?

The buyer

In an Oregon brokerage, who's ultimately responsible for reconciling trust fund account records?

The principal broker

Who's responsible for opening and maintaining trust accounts?

The principal broker

Moneys given for purchase deposits are ______.

Trust funds

When an earnest money check is made payable to the seller, what information must be recorded and maintained?

The purpose of the payment

Which of the following scenarios describes information that a licensee must disclose?

The seller didn't disclose any leaks, but the licensee sees moisture on the basement floor.

When a buyer uses a promissory note as earnest money in Oregon, when is the note payable to the seller?

Upon acceptance of the buyer's offer

You're showing your buyers a house that clearly has a second-story addition. What important thing do you need to find out from the sellers?

Whether or not the addition was permitted

Which of the following is true about record retention of trust accounts in Oregon?

You should maintain all transactional records for at least six years.

Lila hands her in-process transaction file over to her principal broker who will check to make sure she has everything she needs. She has a listing agreement with her new seller clients, emails of their conversations discussing the listing details, some notes about phone calls and text messages they've had, and right on top is a written offer. Lila has noted the date that the offer came in (the day before) and the word "delivered" written across the top. What is Lila missing

The time she delivered the offer

Assuming licensee Shannon has actual knowledge of all of the following property issues, which should she disclose to prospective buyers?

The upstairs bathroom has a leaky toilet.

Why would buyers want to know whether a property is currently experiencing a tax abatement?

Their taxes are likely to increase when the abatement period ends.

Why are galvanized pipes a problem in older homes?

They can rust and cause leaks and low water pressure.

Which of the following is a true statement regarding promissory notes used as earnest money in Oregon?

They're payable to the seller upon acceptance of the buyer's offer.

How long does a licensee have to hand over an earnest money check to the principal broker after accepting the check?

Three banking days

Which of the following insures the policy owner against financial loss if the title to the real estate has covered defects?

Title insurance policy

Who delivers the evidence of a clear title at the closing?

Title insurance representative

While walking around the exterior of a rural home she's inspecting, Juanita noticed a metal vent pipe sticking out of the ground 25 feet from the house. She documents this because it may be a sign of what potential environmental hazard?

Underground storage tank

What is the phrase behind the acronym that describes an electronic data storage device in which information, once recorded, cannot be modified?

Write once, read many (WORM)

Xavier deposited a $3,000 earnest money check into his personal account for safekeeping while he was on vacation. The balance in his account when he left on vacation was $4,200, and when he returned, it was $2,800. He withdrew enough funds from his savings account to cover the earnest money check and delivered the funds to the escrow agent. Which statement best represents Xavier's issue?

Xavier is guilty of commingling and conversion.

Paul and Blake are touring an open house when they notice that the glass on the sliding patio door is very foggy. Is this a concern, and if so, why?

Yes, this is a sign of a leaky seal which reduces efficiency.

Your buyer clients Josie and Terry made an offer that was accepted on a cute bungalow in a city neighborhood. They just received the inspection report and were delighted to see only minor condition issues. They'd like the sellers to replace two windows that have broken seals. In response, the sellers asked for a copy of the inspection report. What must you do?

You can only provide a copy if you get permission from Terry and Josie.

Your buyer clients Sylvie and Daryl reviewed their inspection report and decided that they would address small repairs themselves, but they want the seller to have regrading done to direct water away from the house. What is your responsibility at this point?

You need to communicate to the listing agent that the buyers are requesting regrading.

The market value of your client's property is $280,000. Taxes in the area are assessed at 60% of market value. Your client's semi-annual tax bill was $1,461. What's the tax rate per 100?

$1.74

Anita's property appraised at $370,000. It is assessed at 40% of appraised value, and the tax rate is 80 mills. What are Anita's semi-annual property taxes?

$5,920

The market value for Jessie's property is $410,000. It's assessed at 55%, and the tax rate is $2.75 per $100. What are Jessie's monthly property taxes?

$516.77

Which of the following can indicate an electrical problem?

A burned or discolored outlet

Which of the following wouldn't need to be disclosed by the listing agent who noticed it when selling a home?

A kitchen cabinet that was installed at a slight angle

Jon and Talia are artists who are looking for a home with a backyard that is big enough for them to build a studio. Which of the following properties might they want to stay away from?

A lot that is adjacent to or partially on wetlands

Which of the following statements about material facts is true?

A material fact may have more or less effect on a buyer based on the buyer's needs and values.

Millie is a buyer who has given her agent an earnest money check for $10,000 with an offer to purchase. When will the check be deposited?

After the seller accepts the purchase offer

Trust fund account records must be kept for each account created. Which of the following is a place those records can be stored?

At a brokerage's branch office when the transaction originated with a licensee at that office

When are the mortgage loan commitment and title insurance contract signed?

At the closing

According to Oregon's rules for reconciling clients' trust accounts, what three items do principal brokers use for their monthly reconciliations?

Bank statement, check register or journal, and the total of ledger balances

Bill is joining his inspector Hank for an inspection of the property he hopes to purchase. Hank notices that the dirt on the exterior of the home slopes toward the house. He explains that it should slope away from the home. When it doesn't, what problem might this create?

Basement leaks

Why should buyers ask sellers of older homes whether they've replaced the wiring system?

Because out-of-date electrical wiring can cause a wide a variety of problems.

Before closing, who should get an appraisal of the property if the transaction's being financed?

Buyer

Who is usually responsible for ordering and reviewing the survey of the property?

Buyer

If you see sawdust and can't explain its presence, it's probably a sawdust-like material called frass created by which pest?

Carpenter ants

Your buyer clients are excited because the property they made an offer on provides a home warranty. What should you tell them?

Check the coverage at the time of purchase.

Some groups of people are more vulnerable to lead poisoning and its effects than others. Of those listed, who is most vulnerable?

Children

David's principal broker Arnold meets with each associated broker once a month to look over their financial records. David knows the requirements, so he stays out of the hot seat by making sure all of his records include ______.

Copies of all checks, receipts, and notes on funds received including details like date, time, and purpose

Which of these items around the fireplace could be a clue that there is a problem?

Cracked or sloping firebox or hearth

What's the term for an amount that shows up on the closing statement in a particular party's favor?

Credit

One of the following licensee's actions would constitute commingling. Which is it?

Cynthia deposited her client's earnest money check into the firm's operating account.

Alex is representing Dawn, who has moved out of state and listed her condo in Lake Oswego. Which of the following would be considered a stigma that Alex may not disclose?

Dawn was a hoarder.

What's the term for a charge that a transactional party must pay at closing?

Debit

Seller Jack knows that his property was once the site of a meth lab. What should he do?

Disclose the information to potential buyers

Which of the following is a common problem with roof shingles?

Discoloration or curling

Home inspector Murray is explaining to first-time buyers what he looks for during a home inspection. What is his primary goal?

Document health and safety issues that may affect both the cost and enjoyment of the home.

To provide sellers with assurance they won't back out of the sale, buyers may offer a financial deposit that will be kept in escrow until the conditions are met at closing. What's this deposit called?

Earnest money

Danny has been keeping electronic records for his Oregon brokerage for more than eight months now. How many times has he had to back up his electronic files?

Eight times, because files must be backed up at least once per month.

During a walk-through on a new listing, agent Marco notices a strange smell, missing fire detectors, and discolored walls. His client, Rey, says she rented out the property and isn't aware of any issues. What should Marco do?

Encourage Rey to have the property tested

For which of the following reasons would a title insurance survey require that Joy have a spot survey performed? done to satisfy the title insurance company's requirement for a(n) ______.

For an improvement location certificate

Licensee Conner has been investigated by the state of Oregon for commingling. What has Conner done to violate the license law?

He deposited a buyer's earnest money funds into his personal account.

Donald and Martina decided to purchase a newly built home, and their agent, Ed, recommended that they get a professional home inspection done. The couple tell Ed that they thought inspections were only for older homes. How should Ed respond to that?

He should remind them that every dwelling, no matter the age or size, should have a home inspection.

Chaz represents the buyer in a transaction that has just closed. How will he typically be paid?

His brokerage will receive a commission check from closing; his broker will compensate Chaz according to the terms of their agreement.

When Marcy toured her new client's house, she noticed paint peeling off of the shutters. When she asked the seller if the house was painted with lead-based paint, he replied, "I'm not sure ... I inherited the house from my dad, who built it in the '50s." What is Marcy required to do?

Inform the seller that he needs to complete the lead-based paint disclosure form and provide potential buyers with the EPA pamphlet regarding lead hazards.

In Oregon, what purpose does the promissory note serve?

It's a promise the buyer makes to the lender that the note will be repaid in full.