State & National Exam Questions

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A broker "credit" is money from the escrow account that will be used to pay a vendor for a service for the transaction

True False

True/False - According to Commission Position 38 Disclosure of Affiliated Business Arrangements, a licensee is required to disclose any affiliated business arrangement in which the licensee has a 1% or more interest when an offer to purchase real property is fully executed. A. True B. False

"No physical or economic condition remains constant" refers to which of the following basic principles of value? A. Competition B. Anticipation C. Change D. Contribution

When is cost approach most applicable

1. property involves relatively new improvements, representing the highest and best use of the land (Residential) 2. site possesses unique or specialized improvements, for which there are no comparable properties on the market.

5 additional costs classified as Seller DEBITS during Closing:

2nd Mortgages Home Equity Loans Tax Liens Any contribution(s) to Buyer's closing costs cash contributions for short sales

4-3-2-1 is a familiar approach to one facet of real estate practice. It normally refers to which of the following? A. Lot, house, garage and furniture B. Tract, parcel, quadrant in county C. House, lot furnishing, and garage D. Method used in appraising vacant land of different depths

A 1031 Exchange is: A. changing a transaction broker relationship to a buyer broker relationship B. a tax deferred exchange of investment properties C. a tax deferred exchange of owner occupied primary residences D. a transaction where a promissory note will be exchanged for cash prior to closing

A 6 foot wide sidewalk is to be poured on the inside of a corner lot that measures 50 feet by 100 feet. If the cost of the sidewalk is $0.68 per sq. ft., how much will the sidewalk cost? A. 612 B. 587.52 C. 728.42 D. 660.96

A BPO (Broker Price Opinion) is an estimate of value most often requested by a lending institution of a real estate broker to determine the value of a foreclosed property. Can a BPO be used for financing? A. When there is a shortage of available appraisers. B. When you'd like to save your client money on appraisal fees. C. When your employing broker signs off on it. D. None of the above.

A Broker Price Opinion (BOP) and Competitive Market Analysis (CMA) are estimates of value created by real estate licensees for marketing purposes. Since they were not prepared by a licensed appraiser, the follow words must appear at their bottom: A. This evaluation was prepared by a licensed real estate broker and is not an appraisal. This evaluation cannot be used for the purposes of obtaining financing. B. This appraisal was prepared by a licensed real estate broker. C. This evaluation was prepared by a licensed appraiser. D. This evaluation was prepared by a licensed real estate broker. It may be used to obtain financing only with full disclosure and the signatures of all parties to the associated Contract to Buy/Sell Real Estate.

A Colorado broker with residence out of state accepts an earnest money deposit on a property located in Colorado. He needs to: A. open an escrow account in a Colorado bank B. have a Colorado office open to the public C. open an escrow account in his state of residence D. have an active license in his home state.

A Colorado licensee filling in the blanks in a standard commission approved form: A. Cannot do it because this would be practicing law without having passed the bar exam B. Is allowed if the agent only uses pre-approved standard clauses C. This is the practice of law, but permitted by Colorado law D. This is not the practice of law

A Mechanics' Lien is used by a contractor to secure payment for work performed on a home. A. True B. False

A lot with a depth of 80 feet and an area of 4,800 square feet was sold for $350 per front foot. What was the total sales price? A. 31800 B. 28000 C. 35000 D. 21000 4800sf / 80 = 60 front feet. 60 x 350 = 21,000

A Transaction-broker may NOT do which of the following without ending his/her Transaction broker obligations: A. Sell a buyer his own personal residence B. List competing properties for sale C. Show properties in which the buyer is interested to other prospective buyers D. Serve as a single agent or transaction- broker for the same parties in other real estate transactions **A transaction broker is a neutral party, and you cannot remain neutral by selling someone your very own home**

A agent is on a 60/40% split with his broker, and sells a 275-acre farm at $1,350 per acre. The commission schedule calls for 6% on the first $100,000, 4½ % on the next $50,000, and 3% on the balance. The company must pay the co-op agent 10% of the gross commission. What is total commission and what is the net amount the agent will receive? A. $12,637.50 / $8,039.25 B. $14,887.50 / $8,039.25 C. $12,637.50 / $8,932.50 D. $14,887.50 / $8,932.50

A black homebuyer inquires about a home in a predominantly white residential neighborhood. What should the broker say to the buyer? A. "You don't want to live there because the residents are trying to preserve their racial quotas." B. "I'll be happy to show you areas where black people are welcome." C. "The residents have expressed a desire to keep the neighborhood homogeneous with no minorities." D. "I'll show you any house in which you're interested."

A broker acting as a transaction broker for a buyer, with no written agreement needs: A. nothing. This is the default representation in Colorado B. to provide the buyer with a copy of the "Brokerage Disclosure to Buyer" with the broker's signature showing the date it was given to the Buyer. C. a signed Exclusive agreement in order to show the buyer property. D. a signed disclosure form from the Buyer.

A broker allowed her license to expire and renewed it 32 days after the expiration date. What does she need to do to reinstate her license?" A. Pay the renewal fee B. Pay the renewal fee, and pay half the renewal fee for it being over 30 days C. Pay the renewal fee and retake the state examination D. Pay the renewal fee and take 8 credit hours of continuing education

A broker has a listing on a house that contains a provision that the house is to be sold in "as-is" condition. The broker learns of a major hidden defect in the property. When showing the property to a prospective purchaser, the broker should A. advise the buyer of the defect. B. point out that the house will be sold in "as-is" condition. C. mention the defect to the buyer only if asked. D. inform the buyer that the seller has told him of no defects. ***This is considered a "material fact", and as such must be disclosed through agency relationship***

A broker has an Exclusive Right-to-Buy contract with a principal. Who is to be their customer? A. Buyer B. Broker C. Seller D. Client **Remember: if its a Right to "Buy", then the customer will be the opposite; or the Seller**

A broker is working with a buyer. The buyer believes there to be a water leak in the home. What should the broker do? A. Get an inspection done B. Immediately order a repair of the plumbing C. Contact the listing broker and inform her of the problem. D. Terminate the contract

A broker is working with a buyer. The buyer believes there to be a water leak in the home. What should the broker do? Get an inspection done Immediately order a repair of the plumbing Contact the listing broker and inform her of the problem. Terminate the contract

A broker needs $5950 to pay her IRS tax lien. She has the opportunity to list a property at fair market value of $85000. What would her listing commission rate need to be in order to pay her debt assuming she will pay 2.8% to the selling broker? A. 0.07 B. 0.0725 C. 0.098 D. 0.06 $5950 / $85000 = 7% + 2.8% = 9.8%

A broker supplies the financing for a project to build condominiums with the stipulation that he has the exclusive right to sell the completed condos. Which of the following BEST describes this relationship? A. General agency B. Exclusive agency C. Specific agency D. Agency coupled with an interest

A broker who has the authority to receive deposits on behalf of his principal (the seller) misappropriates a deposit receipt. In such a case, if the buyer sues the seller, the: A. broker alone is responsible B. seller is responsible for the acts of this agent and is liable to the buyer C. the buyer is responsible because he has the choice of making his deposit check payable to the seller or to the seller and broker jointly D. the buyer and the seller share responsibility

A broker with Seller Agency is showing a buyer the seller's home. Who is representing the buyer? A. The broker B. The broker as transaction broker C. No one D. The seller

A broker's office must: A. Be in a commercial office building to comply with zoning B. Be a virtual office doing business by phone and using a post office box mailing address C. Have a physical address where the commission staff can inspect records D. Be open to the public during normal business hours

A managing broker can be held responsible for: A. any action by a salesperson/associate broker all real estate activities of salespersons/associate brokers B. is not responsible for the activities of independent contractors C. is responsible only for activities of which s/he has knowledge

A brokerage, XYZ Realty, is part of a franchise or marketing cooperative with a strong public image. The broker's advertising must indicate this relationship by advertising A. the franchise name with the broker's phone number so that people are led to the correct office. B. both the franchise name and XYZ Realty with the same level of prominence. C. only XYZ since that is how the license is held with the commission. D. the franchise name prominently with "fine print" identifying XYZ.

A builder failed to follow the agreed landscaping plans. The purchaser decided to accept the variance and pay the full contract price. This is know as A. accord and satisfaction B. waiver C. novation D. reformation

A building was sold for $115,000. Earnest money in the amount of $15,000 was deposited, and the buyer obtained a loan for the balance. The lender charged a fee of 2% of the loan. What was the total cash used by the buyer for this purchase? A. 2180 B. 2300 C. 16300 D. 17000 ***$15,000 + 2% of $100,000 = $17,000***

A buyer enters into an exclusive right-to-buy contract and subsequently submits an offer on a property that is accepted; if the transaction fails, through no fault of the purchaser: A. the buyer is obligated to pay his broker a commission B. the buyer is obligated to sue the seller for commission C. the buyer is under no obligation to pay his broker a commission D. none of the above Explanation Contract failed through no fault of the Buyer--in other words he didn't intentionally chose to obstruct or terminate the contract

A buyer made an offer to purchase a property. The owner responded with a counteroffer. While the buyer was reviewing the counteroffer, the owner received a better offer. The owner can accept the second offer if: A. The owner withdraws the counteroffer before it is accepted B. The owner gives the first buyer notice that another offer was received and an opportunity to revise the bid C. The first buyer is informed, in writing, of the owner's intent to accept another offer D. It satisfies or exceeds all terms included in the counteroffer

A buyer makes an offer through the listing broker on a seller's property. The buyer offers $98,000 and asks the seller to pay 3 discount points. The property is listed for $103,900.00. The seller agrees to the $98,000, but submits a counterproposal that she will only pay 2 points. All of the following are true EXCEPT: A. The buyer's offer has been rejected and she is under no further obligation B. The buyer is the offeree C. The seller is the offeror D. The buyer is the offeror

A buyer submits an offer contingent upon the successful closing of their present home. A. the selling agent should request a copy of the contract on the contingent property B. the selling agent should verify the financial ability of the buyer on the contingent property C. the selling agent should fully disclose all information to the seller D. the listing agent should fully disclose all information to the seller

A client is buying an old gas station with the intention of building a flower shop. The lender will likely ask for: A. A Phase 1 environmental assessment with a visual inspection and neighbor interviews B. An Environmental Impact Study (EIS) C. A Phase 2 environmental statement with soil testing D. Request if a CERCLA assessment report has been issued in the prior 2 years making the property owner innocent of past environmental liabilities as per the Brownfield Revitalization Act

A client wants to buy a commercial property. You tell her they are putting in an exit ramp off the highway, that is proposed but not set in stone, that would allow easy access to the business. The client buys and they end up putting the ramp elsewhere. Are you responsible as the broker? A. No, the agent was truthful B. No, this is puffing C. yes, this is puffing D. yes, this is a misrepresentation

A competitive market analysis (CMA) is MOST often used for: A. setting a listing price B. estate tax purposes C. property tax assessment D. divorce proceedings

A competitive market analysis is performed when: A. Condemning property B. Pricing property C. Appraising property D. Assessing property

A managing broker can be held responsible for: A. any action by a salesperson/associate broker B. all real estate activities of salespersons/associate brokers C. is not responsible for the activities of independent contractors D. is responsible only for activities of which s/he has knowledge

A contractual disagreement led to a seller's reducing the contract price by $1000. This agreement would be: A. unenforceable because of a lack of consideration B. an accord and satisfaction C. a novation D. a waiver

A counterproposal: A. is a rejection of a proposed contract to buy/sell B. amends the terms and conditions of a proposed contract to buy/sell C. use is mandatory to modify the terms and conditions of a contract to buy/sell D. is used to counter the purchase price only of a proposed contract to buy/sell

A couple owns and investment property and wants to sell it to buy a new investment property. The best way for them to defer capital gains tax is: Take the $500,000 capital gains exemption for this two-year period Take a $250,000 capital gains exemption for this two-year period There is no way to defer capital gains on an investment property. Perform a 1031 like-kind exchange for a more expensive property.

A court orders real property sold, to satisfy an unpaid lien, in an action known as a(n): A. easement B. encumbrance C. attachment D. writ of execution

A deed in which the grantor implies having an interest in a property but offers no warranties as to title is a A. quitclaim deed B. bargain and sale deed C. warranty deed D. sheriff's deed

A deed of trust held by someone other than the public trustee is NOT: A. Notice that a legal action is pending that may effect ownership B. Exempt from loan recission rules C. Foreclosed through the courts D. A conditional transfer of ownership from the Trustor to the Beneficiary

A developer builds 50 garden apartments in an existing two story building that contains no elevator: A. All units must comply with ADA. B. None of the units must comply with ADA since it is a two-story building. C. The units on the first floor must comply with ADA. D. The developer must put in an elevator.

A developer is going to finance some land he wants to build on. It would be in his best interests to include in the mortgage a: A. Subordination clause B. Sub-development clause C. Subrogation clause D. Severalty clause ***A subordination clause that he can obtain other financing to develop the property and the initial lender would be willing to take a secondary position***.

A father and son own land as joint tenants. The father conveys one half of his interest to his daughter. Ownership would now be held by: A. father, son and daughter as joint tenants B. father, son and daughter as tenants in severalty C. father and son as joint tenants with daughter as tenants in common D. father, son and daughter as tenants in common Joint tenancy is severed and the three are now tenants in common

A final walk-through provides all of the following except: A. buyer the opportunity to verify that the property is in the same condition as when originally viewed B. buyer the opportunity to verify any repairs that needed to be done, have been completed C. the opportunity to re-inspect the property the final time D. to terminate the contract if not satisfied with the condition of the property

A freehold estate is most nearly: A. An estate for years B. An estate at will C. A fee simple estate D. A leasehold estate

A general agent might be considered: A. a buyer's broker B. a seller's agent C. a property manager D. an attorney **A GENERAL Agent, not limited agent**

A home closes for $365,000, how much would you pay the county clerk and public trustee? A. $3,650 B. $36.50 C. $365 D. $3.65

A homeowner refused to accept a full price contract offered by a buyer with children. He told his broker that he only wishes to sell his home to single adults with absolutely no children. The broker should: file a fair housing complaint with HUD and try to collect a commission refer the homeowner to firms that offer listings for "single adults" only do your obedience duty, listen to seller and look for buyer w/o children advertise listing as "for singles only"

A house has a first mortgage of $170,000 and a second mortgage of $34,000. The property has just been sold at a foreclosure auction to a speculating investor for $210,000. Assume that all costs of the foreclosure sale are included in these balances. Which of the following statements is NOT TRUE regarding the distribution of funds? A. The foreclosed owner receives $6,000 B. The second mortgage holder receives $34,000 C. The second mortgagee receives nothing unless they initiated the foreclosure D. The first mortgage holder receives $170,000 ***Again, I didn't read the question--sloppy sloppy***

A house is closed on April 15. The property taxes are $960 for the year. They have not been paid. How much does the buyer receive from the seller at closing? A. 360 B. 274 C. 280 D. 680 $960 / 365 days = $2.6301 per day the seller owned the property and owes the Buyer for 104 days. $2.6301 x 104 = $273.53

A house is closed on July 16. The taxes of $546 for the current year have been paid, what is the prorated portion that the buyer owes the seller A. 251.31 B. 252.81 C. 293.19 D. 294.69 546/ 365 = 1.49589041 1.49589041 x 169 = $252.81

A house is closed on October 15. The annual insurance payment is $578 for the fiscal year of July 1 to June 30. The buyers will assume the seller's policy. Since the policy has been paid, how much does the buyer owe the seller at closing? A. 167.86 B. 410.14 C. 408.56 D. 169.44 $578 / 365 = $1.5836 per day. Seller paid for 259 days; he didn't own the policy (Oct. 15 through June 30) 259 x $1.5836 = $410.14

A house is sold on June 15. The annual taxes in the amount of $850 for the year have not been paid. What does the seller owe the buyer at closing? A. 384.25 B. 465.75 C. 468.08 D. 381.92 Jan. 1 - June 14 = 165 days. $850 / 365 = $2.3288 per day tax liability.165 days x $2.3288 = $384.25

A lady goes to a bank to get a loan for a subdivision she wants to build. The bank orders a phase one environmental assessment. What does this assessment include? A. Soil and water samples looking for hazardous materials B. Review of records, a site inspection and interviews with owners, occupants, neighbors and local government officials C. A review of a development's impact on air and water quality D. The performance of environment mitigation to minimize or eliminate known hazards

A lease in which the lessee's total monthly rent costs remain unchanged for the term of the lease is what type of lease? A. Gross B. Net C. Percentage D. Graduated

A lender has agreed to loan $55,000 with monthly interest payments of $424. What interest rate has the lender agreed to? A. 0.08625 B. 0.103 C. 0.11 D. 0.0925 $424 (monthly interest) x 12 (months) = $5,088 annual interest. $5088 (annual interest) / $55,000 (loan amount) = .0925 or 9.25% annual interest rate

A lender may hold how many months of tax reserve in an escrow account? A. None B. 1 C. 2 D. 3

A lender requires the use of a Name Affidavit to identify: A. the legal names of all borrowers B. all of the alias' used by the borrowers C. the beneficiary in the event of the death of the borrower D. the birth name of all female borrowers

A licensee may negotiate the terms upon which to take a future listing when: A. by first contacting the current listing broker and receiving permission to seek the seller's future business B. the licensee is contacted by a seller C. the licensee contacts a seller and the seller agrees to sign a future listing D. this is not permitted under any circumstance

A lien is a monetary claim that if unpaid awards the lien holder the right of: A. foreclosure B. eviction C. ownership D. possession

A life estate is lost by the process of merger which occurred when: A. the leasehold estate became a freehold estate B. a remainder interest holder purchased the life tenant's interest C. title was taken as tenants in entirety D. the public trustee obtains an interest in the property called naked title.

A listing broker is creating a listing agreement and notices the sellers didn't include previous damage to the home. The broker knows of the damage and when questioned the sellers they say the want to leave it out because it will deter buyers. The agent should? A. Take the listing but discretely tell any potential buyers about the damage. B. Take the listing. Its not her job to tell the buyers everything C. Tell the sellers they have to fill the form out honestly and if they don't, she should not take the listing.

A loan which requires the borrower to pay interest only and then to pay the entire principal on the maturity date, is called a: A. wraparound loan B. term loan C. shared-equity loan D. partially amortized loan

A lot is 275 feet deep and sits on 2/3 of an acre. What is the width of the lot? A. 158.4 B. 105.6 C. 106.5 D. 112.4 ***43560*.6667 (2/3) = 29041.452 29041.452/ 275 = 105.60

A mortgage that has not been recorded or registered in the county in which the real estate is located: A. is a matter of public record, and the world has constructive notice of it's existence B. is a matter of public record, and the world has actual notice of it's existence C. is not valid D. is not protected by a priority position in the event of foreclosure

A notice to quit should be: A. delivered to lessee via first class mail B. delivered to any family member C. must be served by the county sheriff D. delivered to a family member of at least 15 years of age A notice to quit is basically a 3-day notice to pay up or move out

A owner agrees to lease a property to be used as a casino. State laws prohibit gambling. This contract would be legally defined as A. void B. voidable C. valid D. unenforceable **A contract for an illegal purpose is void. An essential element of a contract is that it be for a legal purpose.**

A package mortgage is one used to finance: A. real and personal property with one security instrument B. more than one property with one security instrument C. lease-back agreements D. none of the above

A permissive use that gives no future rights to the user would be a(n): A. license B. easement C. nonconforming use D. encroachment

A permitted agent C to show his property and hold himself out as A's agent. C negotiated a deal with B on behalf of A. A tried to get out of the deal, but was required to keep the contract. This is an example of : A. ratification B. estoppel C. express authority D. writ of execution

A person who owns a fee simple interest, in a unit, in a multi-unit building together with a specified undivided percentage of all common elements would be the owner of a: A. cooperative B. share in a real estate investment trust C. condominium D. syndicated venture

A pool has a bad lining and a non-working pump. What should the buyers' agent tell their client about this situation and its effect on the price of the home? This is external obsolescence as it is outside the house, offer less. This is physical obsolescense as it is broken, offer less. This is functional obsolescense as no one has pools anymore, offer less This is economic obsolescence as pools are expensive to maintain, offer less.

A price at which a willing and informed buyer would buy and a willing and informed seller would sell is called the: A. Assessed value B. Book value C. Market value D. Equity

A primarily white neighborhood was starting to change over to more racially mixed demographic. An advertisement said "sell now before it's too late". Can the realtor be in trouble for this and if so, under what premise? A. Yes, this is blockbusting B. Yes, this is redlining C. No, as long as the properties she sells do not involve government loans D. No, as long as no explicit statements are made as to race or origin

A private owner of a single 20-acre parcel of land wishes to sell off ten acres and retain ten acres for her own use. Which statement is true for this owner? A. As the private owner, there are no restrictions or registration requirements. B. The owner is not required to register with the real estate commission but must meet local and state requirements for this subdivision. C. A private owner may not sell only part of a single parcel; only a registered subdivider may divide land. D. The private owner must comply with federal land sales rules.

A property is listed with Rockwell Realty at $70,000. Rockwell Realty negotiates with Woods who is familiar with the property and who agrees to buy the property at that figure. Rockwell Realty prepares an agreement of sale, which is signed by Woods. Copies are then mailed to Downes, the owner, for signature on May 31, 2014. Downes receives the copies on June 3, 2014. He signs them and mails the signed copies to Woods on June 5, 2014. On June 4, 2014 Woods wired Downes, "Offer withdrawn." Under these circumstances: A. There is an enforceable contract B. Rockwell Realty is entitled to a commission C. This is not an enforceable contract but Rockwell is entitled to a commission D. This is not an enforceable contract and Rockwell is not entitled to a commission

A property owner died, having willed his real property to his two daughters. There is still a chance that they could lose the land for a variety of reasons, but it CANNOT be taken through A. escheat B. a challenge to the will C. condemnation D. sale to satisfy a tax lien

A property owner has an easement to allow them access to their driveway. What kind of easement is this? A. easement in gross B. easement appurtenant C. easement prescriptive

A purchaser desires to offer $174,900 for a home. The buyer will put a total of 15% down of which 1% will be put down as an earnest money deposit. How much will the new loan be for? A. 147143.5 B. 146916 C. 148665 D. 147178.35 $174,900 X 15% = $26,235 $174,900 - $26,235 = $148,665

A real estate agent does a open house for a fellow colleague. The listing is not hers. The potential buyers ask her questions about the property and the questions she does not know she says she will get back to them. A. Implied agency was created B. Express agency was created C. No agency was created D. She is now their agent

A real estate agent is paid $200.00 a month salary and a 2 ½ % commission on everything sold over $150,000 in one year. If the agent makes $22,000 one year. How much did the agent sell? A. 784000 B. 634000 C. 934000 D. 880000 ***$200 X 12 = $2,400 (total salary); $22,000 - $2,400 = $19,600 (total commission sales) / .025 (commission rate) = $784,000 (sales above $150,000 that earned the $19,600 commission) + $150,000 = $934,000 (Total Sales)***

A real estate broker shall NOT engage in any of the following acts: A. dealing in options on real estate B. preparing legal documents as a courtesy for the seller of a for a sale by owner transaction C. selling or offering to sell or exchange a time-share D. auctioning real estate ***This is a conway-bogue violation***

A real estate license, or license for a broker who is working for another broker, may be issued: A. To a partnership B. To a corporation C. Under a fictitious name D. To a woman using her birth name

A release clause in a mortgage: A. Provides for an option to extend its due date Releases a guarantor from further liability under specified conditions B. When part of a document creates a lien second only to the lien of taxes and assessments C. Allows portions of the property, given as security, to be released from the mortgage lien upon performance of a specified act

A sale and leaseback arrangement is one in which a seller sells a property to a buyer and then leases the property back. Which is correct as it applies to a sale and leaseback arrangement? A. The seller retains title to the property B. The buyer gets possession of the property C. The seller retains possession of the property D. The buyer receives equitable title only **Read the answers carefully--the seller retains possession (not title) to the property**

A section is 1 mile by 1 mile. How wide is a four-acre (a hint: one acre contains 43,560 sq ft) easement that runs along the western edge of a section? A. 33 feet B. 38 feet C. 45 feet D. 28 feet

A seller may give actual notice of an interest in property by A. recording the deed B. telling someone the property is his C. searching the public records D. recording the deed of trust

A seller mentions to her agent that the previous owners of the property may have dumped hazardous waste on the site. Under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), who is liable for damages from the dumping prior to the sale of the property? A. Agent B. Buyer C. Seller D. The City

A seller providing financing may be exempt from attaining a lender's license if they have completed: A. a seller providing financing always needs a mortgage license B. less than 3 transactions in the past 12 months C. less than 5 transactions in the past 12 months B. less than 5 transactions is the past 15 months.

A six-foot sidewalk is to be poured on the outside of a corner lot that measures 50 feet x 100 feet. If the cost of the sidewalk is $0.68 per square foot, how much will the sidewalk cost? A. 612 B. 636.48 C. 728.42 D. 660.96 ***50 x 6 = 300 + 100 x 6 = 600 + 6 X 6 = 36 = 936 sq ft X $.68 = $636.48***

A tenant rented a townhome, signing an 18-month lease. After the lease expired, the tenant paid 1 month's rent and got a receipt. What kind of leasehold does the tenant have? A. Tenancy at sufferance B. Gross lease C. Tenancy at will D. Tenancy for years

A tenant with disability would like to make reversible changes to the property that effect the structure. In this scenario: A. The changes must be allowed, but only in an apartment building that has more than 4 units B. The changes must be allowed as long as the tenant pays for it C. The tenant must get approval from the owner for any change D. The landlord must pay for the changes to meet ADA regulations

A title insurance policy will protect a buyer from financial losses that are caused by: A. A change in zoning regulations. B. A recorded easement to which the policy has taken an exception. C. An unrecorded easement to which the policy has taken an exception. D. An encumbrance to which the policy has not taken an exception.

A transaction broker has which of the following duties to a buyer? A. To advise the buyer regarding the transaction B. To verify the measurements of a property being purchased C. To offer personal opinions regarding desirability of a neighborhood D. To communicate to the seller what the buyer's motivating factors are

A transaction broker must: A. not act as an advocate for either party, but must exercise reasonable skill and care B. act as an advocate for either buyer or seller C. inform the buyer or seller that they could be legally responsible the agent's actions D. may not act as an advocate for either party **Be sure you read all of the answers, Jennifer

A woman listed her house that had prize roses bushes in the backyard. She told her agent that she would be removing the roses from the garden and preparing the soil for the new owner to plant their own flowers. Upon the walk-through, the buyers saw that the roses were removed and were angry. That is one of the reasons they were buying the house. What would be the best scenario in this situation?" A. If the roses bushes were not listed as an exclusion the Buyers have the right to cancel the agreement B. The Buyers would still be bound to purchase the home if the Sellers plant new rose bushes C. The Sellers intent rules, the Buyers must complete the transaction D. The Sellers have no recourse, they must replant the rose bushes they removed.

ADA laws require a landlord to: A. select a certain percentage of minorities as tenants B. give special consideration to the individuals with disabilities C. ignore the sexual orientation of a prospective tenant D. provide housing to adults with children under the age of 18

Acceptance of an offer must be which of the following? A. Absolute and unqualified B. Expressed or communicated C. Within time limits D. All of the above

Acceptance of an offer must be which of the following? A. Signed by all parties B. Acceptance must be communicated C. Within time limits D. All of the above

According to Colorado law, dual agency is: A. illegal B. legal with disclosure C. legal but the real estate commission does not prefer dual agency D. the best protection for the buyer and seller

According to Colorado law, in the absence of a written agreement to the contrary, a real estate broker: A. represents the seller B. represents the buyer C. represents both the buyer and seller D. represents neither the buyer nor the seller

According to Commission Position 42 on Apartment Building or Complex Management, a duty an unlicensed on-site manager may NOT perform without a license is: A. Draw up a lease B. Sign and execute a lease with a Power of Attorney from the owner C. Collect and deposit rents and security deposits D. Obtain information necessary to qualify perspective tenants for a lease.

According to the Colorado Licensing Law, in order for a non-resident to become a broker: A. he must meet Colorado licensing law only B. he must be involved in real estate in his home state C. he must be 21 and have been involved in real estate for two years D. he must be a broker from his home state and pass Colorado licensing laws, but need not open an office in Colorado **Minimum age in Colorado is 18, and they only need to have a Colorado Trust Account***

According to the Rule E-48, brokers are allowed to file a lien, a lis pendens or record a listing contract to secure payment of a commission under what circumstances? A. Only with the written permission of the seller. B. Only if the amount is under $2,000, and then must file in Small Claims court. C. Only if there is a mechanic's lien already recorded, since that lien has already clouded title. D. Brokers may never cause the title to become clouded if they are not principals in the transaction.

After the Sellers columns on a Settlement sheet have been subtotaled, to balance the two debit and credit columns, a credit to the Seller and a debit to the broker would represent: A. Money due to the Buyer B. Money due to the Seller C. Money owed by the Seller D. Money owed by the Buyer

After the construction of a building over a railroad right-of-way, trains usually can: A. operate as usual B. no longer operate on tracks under the building C. operate on tracks under the building only if they cause no problem for occupants of the building D. operate only during selected hours of the day

Agency disclosure must be made in writing: A. before receiving or eliciting confidential information B. to all guests attending an open house C. when handling ad calls D. all of the foregoing are true

Agency means the broker owes to their clients certain duties. Which of the following is NOT TRUE: A. Loyalty B. Honesty C. Accounting D. Indemnification

Al Jones, Harold Murphy, and Josh Hagstrom are joint tenants owning a parcel of land. Hagstrom conveys his interest to his friend, Willy Phillips. After the conveyance, Jones and Murphy: A. become tenants in common B. remain joint tenants owning an undivided 2/3 interest in the land C. become joint tenants with Phillips D. continue to be joint tenants with Hagstrom

All parties are presumed to have the legal capacity to enter into contracts. But certain persons, for reasons of public policy or some disability, do not have full contractual capacity. All of these do not have contractual capacity except: A. minors B. mental impairment C. intoxicated persons D. a person over eighty years old

All of the following are true except: A. fixtures installed after the mortgage is recorded become subject to that mortgage lien B. a person tears down a fence with the intention that it remain permanently down and stacks the fencing; it becomes real property C. trade fixtures installed in a building can be removed by the tenant D. a gas furnace installed in a house becomes real property

All of the following are true regarding the Exclusive Right-to-Sell listing contract except: A. there is a one contract for all types of listings B. a listing contract may establish seller-agency C. a listing contract may be executed without establishing agency D. more than one listing contract may be executed for the same time period, for the same property

All of the following must be disclosed to a tenant by a property manager EXCEPT: A. Disclose in writing that the property manager works for the landlord B. Disclose that the tenant is not "vicariously liable" for acts of the agent C. Disclose name and address of the landlord D. Disclose adverse material facts about the property known by the agent

All of these are requirements of a borrower under an FHA insured loan except: Not borrow any money for the down payment. Pay a monthly mortgage insurance premium. To pledge never to obtain a second loan. Certify that he will occupy the premises.

All units in a community are being assessed for sidewalk improvements to a road along one side of the community. This is: Rise in property taxes A Community Assessment Rise in HOA dues A Special Assessment

All unpaid ad valorem taxes become delinquent on: A. Feb 28th B. June 16th C. May 1st D. Sep 1st ***This was a trick question--they are asking when the entire amount will be delinquent***

6 Costs classified as Buyer DEBITS at Closing:

Amount required to purchase property Shared Closing Costs Prorations Rent owed to Seller Prorated Mortgage Interest Documentary Fee

An Employing Broker designates one seller agent and one buyer's agent. The Employing Broker has: A. agency with seller, not buyer B. limited agency C. agency with buyer, not seller D. no agency ***Employing broker becomes Switzerland***

An Environmental Impact Statement (EIS) A. summarizes the environmental impact of an existing project B. is used primarily for state and Federally funded projects C. must be approved by all affected water districts D. projects the impact on the environment of a proposed project

An Exclusive Right to Buy Contract is NOT the same thing as a Listing Contract A. True B. False

An Exclusive Right to Sell Contract is the same thing as a Listing Contract A. True B. False

An act affording constructive notice to the world of the existence of an instrument and of the interest, which it purports to create, is: A. Recordation B. Acknowledgment C. Condemnation D. Ratification

An agency agreement requires all of the following except: A. consideration B. competency of the principal C. agreement of the agent D. agreement of the principal

An agency relationship between a property manager and a property owner is usually created by A. an exclusive agency contract B. an independent contractor agreement C. a management contract D. a licensee buyout agreement

An agent does not like another broker and refuses to present his offers. The agent's employing broker notices he does a good job and sells his listing quickly. They agree that he does not need any supervision or training. He is independent. This is: A. Ok because the broker doesn't like the other broker either B. Not ok and both broker and agent can be in trouble for lack of supervision C. The agent could get in trouble, but not the employing broker unless the broker put his views in writing. D. Ok because he is selling his listings quickly

An agent lists a property using the Colorado Exclusive Right to Sell Listing Contract and checked the "Shall Not" box in the Holdover Clause. Just before the listing expired, a buyer views the property. Wanting to retain the rights to this buyer, the listing agent provides the buyer's name in writing to the seller. After the listing expires, the seller lists with another agent and the buyer's agent submits an offer on the property. If accepted, would the old listing agent receive a listing commission? A. No, the new listing broker earns the listing side commission B. Both the new and the old listing agent have earned a listing side commission C. Yes, because it is within the holdover period D. Yes, because he is the procuring cause of the sale. **Clicking the Shalt Not box removes any chance of the initial broker receiving a commission, regardless of whether he provides the buyer's name to the seller or not. That's it--game over.***

An apartment building has potential gross annual income of $50,000. The vacancy factor is 5%. The maintenance expenses are $1,000 per month. The property taxes are $3,500 per year. The insurance is $2,500 per year. The reserve account is built at a rate of $200 per month. The mortgage payments are $1,500 per month. If the value of the building is $338,750, what is the capitalization rate? A. 0.08 B. 0.09 C. 0.1 D. 0.11 ***Gross rents $50,000 - vacancy (5%) $50,000 x .05 - 2,500 = $47,500 (Maintenance $1,000/mo x 12 =) $12,000 + (Property taxes) $3,500 + (Insurance) $2,500 + (Reserve acct. $200/mo x 12 =) $2,400 = Total $20,400. $47,500 - $20,400 = $27,100. R = I / V. R = $27,100 /$338, 750 = 8%***

An applicant for a Colorado real estate license who has been licensed in any other state must file which of the following proofs of that licensure? A. Photocopy of her license from that state B. Letter from the last employing broker C. A certificate of licensing history from the other state's real estate licensing authority D. A copy from the testing center that they have passed the Colorado exam

An appraiser in the appraisal of a single-family residential home would use: A. recent sales prices B. exchange prices C. offering prices D. listing prices

An appropriate duty for an agent but not a transaction broker would be: A. Presenting all offers in a timely manner B. Counseling as to material benefits and risks C. Exercising reasonable skill and care D. Accounting in a timely manner for money and property

An associate broker may operate from: A. his home B. any branch office of his broker C. the address on his license D. any office the broker designates Explanation Your license must be in your broker's office, where you work.

An elderly couple is selling their house, they accept an offer, but the closing hasn't happened yet. The couple gets in a car wreck and the man dies. Knowing it would be a hardship to make the surviving wife move, is she able to pay the broker's commission and get out of the contract? A. No B. Yes

An employing broker can usually avoid disciplinary action for the improper conduct of one of his employed licensees if: A. a licensee with 10-years experience produced an Installment Land Contract without the knowledge of the employing broker B. the broker can establish that he never authorized the improper conduct C. the licensee has less than two years in the business D. A broker can never avoid disciplinary action for improper conduct of a licensee. They are always ultimately responsible

An estate of inheritance or a life estate, is known as: A. freehold B. less than a freehold C. greater than freehold D. leasehold

An example of negative amortization is a loan: A. where the amount applied to interest declines each month B. that is only partially amortized C. where the payments are insufficient to cover the loan interest D. where monthly payments are "plus interest" rather than "including interest"

An executory contract is one which: A. is made by executor of an estate for the sale of probate property B. is yet to be performed C. has been completely performed D. has been proposed but not accepted by either party

An existing mortgage loan may be changed to a junior lien by: A. court order B. satisfaction of the first mortgage loan C. a subordination agreement D. exchanging before the first mortgage was recorded.

An licensee shows a home and mentions that it has a lovely fireplace in the living room. After buying the home, the buyers and agent discover that the brick fireplace is just a decorative fireplace and is not "wood burning." Which of the following would BEST protect the licensee from financial loss? A. Homeowner warranty insurance B. The state recovery fund C. Errors and Omissions coverage D. the agent's homeowners insurance policy

An offer to purchase is given to Broker Mary who has an Exclusive Right To Sell listing agreement with a seller. She.. A. must verify buyer's financial condition by her independent investigation B. is responsible for validating sellers statements on Sellers Property Disclosure C. must personally investigate condition of property and disclose material facts to buyer D. must disclose all material facts about the property that is know to her

An owner falls behind on payments. The lender declares the full loan amount due. This is the result of what clause in the promissory note: Due On Sale clause Acceleration clause Habendum clause Consideration clause

An owner has refinanced his primary residence and decided to take cash out of the loan to buy a fixer-upper. If the closing is scheduled for today (Monday) on the primary residence, how early can the owner close on the fixer upper? A. Right after the closing B. Since he will get a check and since that check needs to be cashed, the earliest he can go buy is Thursday C. Since the right of rescission is 3 days, he will not get the check until 3 business days after the closing which would be Friday D. Since the right of rescission is 5 days, he will not get the check 5 days from the closing, the earliest he can buy is the following Monday

An owner is in default on a mortgage payment. The lender could call the entire loan balance due if the loan contained a(n): A. due-on-sale clause B. "or more" clause C. defeasance clause D. acceleration clause

An owner lost their home due to foreclosure. The house sold for $700,000 with $40,000 left over from the foreclosure sale of the property. They thought they were free and clear from financial obligations until they received a letter in the mail saying they owed more money. Why would they owe more money? A. lis pendens B. mechanics lien C. taxes D. judgment

An underground pipeline for irrigation of a farm is: A. personality B. realty C. a riparian right D. an emblement

Angie sold her house for $84,000, which was 40% more than what she paid for it six years ago. How much did Angie originally pay for the house? A. 117600 B. 52500 C. 96000 D. 60000 $84,000 / 140% ( the original price 100% plus the 40% increase) = $60,000

Antitrust laws prohibit competing brokers from all of the following EXCEPT A. receiving compensation from both the buyer and the seller B. boycotting other brokers in the marketplace C. dividing the market to restrict competition D. agreeing to set sales commissions and management rates

Any excess funds above those required to pay off encumbrances realized at a foreclosure sale belong to: A. The State General Fund B. The mortgagee C. The mortgagor D. The Lender

4 Costs classified as Seller CREDITS at Closing:

Any funds payable to Sellers Paymt for property sold Rent (if occupied prior to closing) Prorations for Taxes and Water

To make 1 lump-sum payment for property taxes, what is the cut-off date? April 30 May 1 February 28 Sept 30

April 30

Arthur has a five-year lease on the house in which he lives. The lease is in writing and has been recorded. If the owner sells the house: A. Arthur will become a subtenant of the new owner B. The new owner may require Arthur to vacate the premises since the new owner has no lease agreement with the new owner. C. Arthur may vacate the premises without liability for any more rent D. The new owner takes title subject to the lease and Arthur is still bound by the lease

As a property manager, you have an agreement that your fee will be 8% on the first $150,000 gross rent, 5% on the next $100,000, and 2.5% on everything over the $250,000. If last year's gross rent was $417,500 what was the management fee? A. 4187.5 B. 9187.5 C. 21187.5 D. 16187.5

As agent for a principal, a real estate broker can: A. guarantee a prospective buyer that the principal will accept any offer that meets the terms of listing contract B. solicit an offer to purchase from a prospective buyer C. change the terms of the listing contract D. advise the prospective buyer of the best way to take title to the property

As per the Contract to Buy/Sell Real Estate Mediation shall terminate in the event the entire dispute is not resolved within how many days of written notice requesting mediation delivered by one party to the other at the party's last known address? A. 10 B. 30 C. 45 D. 60

Assuming a real estate sales contract does not address the issue of death "except as written", which of the following actions apply if the seller dies prior to settlement: A. the contract becomes null and void B. the contract remains valid and enforceable C. the seller's estate has the right to cancel the contract D. the buyers may cancel the contract

At the time of harvest, crops that require annual planting are generally considered to be A. personal property B. real property C. appurtenances D. improvements

At the time of taking the listing, the broker has the responsibility of: A. providing buyers B. providing comparable properties and their prices C. driving a nice car D. listing the property high

Broker A is a sole proprietor. He quits business and goes to work under Broker B. Whose responsibility is it to keep Broker A's previous records? A. Broker A B. Broker B C. Real Estate Commission D. None of the above

Broker Abraham of Performance Real Estate was invited to list a property owned by Benjamin and Margaret Radcliff. The home was recently appraised at $275,000 by an independent appraiser but the Arapahoe County assessed value was $220,000, it is a 2743 square foot two-story home with 2163 finished square footage. The 3 Bedroom 2 ½ bath home build in 1981, has recently had carpet installed and the outside of the home repainted, but the kitchen has had no updates and the appliances, except for the refrigerator purchased one year ago, are all more than 8 years old. Prior to going on the listing appointment, broker Abraham did his due diligence in researching properties that have sold in the neighborhood and also current listings, he found two homes sold within the past two months at $250,000 and $285,000 the other four have all been sold more than a year ago at prices varying from $215,000 to $307,500. The only current listing is at $299,000, has been on the market for 75 days and is a 4 bedroom, 3 bath, with 2400 square foot home with 2250 finished, and has several upgrades that seller Radcliff's home does not have. Abraham's analysis shows that the Radcliff home should be listed at $274,900; Abraham also discovered that the property had a mold problem which was mitigated by a certified mold removal company. After making his presentation, the sellers decide they would like to work with Abraham but insist that the property be listed for $325,000. After much discussion Abraham takes the listing for 6 months at the $325,000 price with the understanding that they will review the price after two weeks; if the number of showings has been less than five, then the price will be reduced. He has also agreed that he would do open houses every weekend until the property is sold. The sellers have agreed to keep the property neat and clean and keep the dog in a kennel in the garage on scheduled showing days. After two weeks there have only been 2 showings and the price is reduced after a heated discussion to $319,000. After three more weeks of no additional showings Abraham suggested that the price should be reduced. The Radcliff's decline another price reduction and want to get out of the contract. Abraham and the Radcliff's cannot come to a termination agreement and the property stays on the market until expiration. Question: What is the most likely approach that Broker Abraham used in determining the recommended listing price? A. Cost approach B. Income Approach C. Market Comparison D. Reproduction Comparison

Broker Abraham of Performance Real Estate was invited to list a property owned by Benjamin and Margaret Radcliff. The home was recently appraised at $275,000 by an independent appraiser but the Arapahoe County assessed value was $220,000, it is a 2743 square foot two-story home with 2163 finished square footage. The 3 Bedroom 2 ½ bath home build in 1981, has recently had carpet installed and the outside of the home repainted, but the kitchen has had no updates and the appliances, except for the refrigerator purchased one year ago, are all more than 8 years old. Prior to going on the listing appointment, broker Abraham did his due diligence in researching properties that have sold in the neighborhood and also current listings, he found two homes sold within the past two months at $250,000 and $285,000 the other four have all been sold more than a year ago at prices varying from $215,000 to $307,500. The only current listing is at $299,000, has been on the market for 75 days and is a 4 bedroom, 3 bath, with 2400 square foot home with 2250 finished, and has several upgrades that seller Radcliff's home does not have. Abraham's analysis shows that the Radcliff home should be listed at $274,900; Abraham also discovered that the property had a mold problem which was mitigated by a certified mold removal company. After making his presentation, the sellers decide they would like to work with Abraham but insist that the property be listed for $325,000. After much discussion Abraham takes the listing for 6 months at the $325,000 price with the understanding that they will review the price after two weeks; if the number of showings has been less than five, then the price will be reduced. He has also agreed that he would do open houses every weekend until the property is sold. The sellers have agreed to keep the property neat and clean and keep the dog in a kennel in the garage on scheduled showing days. After two weeks there have only been 2 showings and the price is reduced after a heated discussion to $319,000. After three more weeks of no additional showings Abraham suggested that the price should be reduced. The Radcliff's decline another price reduction and want to get out of the contract. Abraham and the Radcliff's cannot come to a termination agreement and the property stays on the market until expiration. Question: Why was the county assessed value below the value of the most recent appraised value? A. The Broker made a mistake in his sales comparison analysis B. The county should have used the most recent sold information in setting the appraised value in setting the assessed value C. The assessed value and the appraised value are used for different purposes. D. The county used the historical approach.

Broker Abraham of Performance Real Estate was invited to list a property owned by Benjamin and Margaret Radcliff. The home was recently appraised at $275,000 by an independent appraiser but the Arapahoe County assessed value was $220,000, it is a 2743 square foot two-story home with 2163 finished square footage. The 3 Bedroom 2 ½ bath home build in 1981, has recently had carpet installed and the outside of the home repainted, but the kitchen has had no updates and the appliances, except for the refrigerator purchased one year ago, are all more than 8 years old. Prior to going on the listing appointment, broker Abraham did his due diligence in researching properties that have sold in the neighborhood and also current listings, he found two homes sold within the past two months at $250,000 and $285,000 the other four have all been sold more than a year ago at prices varying from $215,000 to $307,500. The only current listing is at $299,000, has been on the market for 75 days and is a 4 bedroom, 3 bath, with 2400 square foot home with 2250 finished, and has several upgrades that seller Radcliff's home does not have. Abraham's analysis shows that the Radcliff home should be listed at $274,900; Abraham also discovered that the property had a mold problem which was mitigated by a certified mold removal company. After making his presentation, the sellers decide they would like to work with Abraham but insist that the property be listed for $325,000. After much discussion Abraham takes the listing for 6 months at the $325,000 price with the understanding that they will review the price after two weeks; if the number of showings has been less than five, then the price will be reduced. He has also agreed that he would do open houses every weekend until the property is sold. The sellers have agreed to keep the property neat and clean and keep the dog in a kennel in the garage on scheduled showing days. After two weeks there have only been 2 showings and the price is reduced after a heated discussion to $319,000. After three more weeks of no additional showings Abraham suggested that the price should be reduced. The Radcliff's decline another price reduction and want to get out of the contract. Abraham and the Radcliff's cannot come to a termination agreement and the property stays on the market until expiration. Question: The seller could have gotten out of the contract for all of the following reasons except. A. The house burned down B. Death of the seller C. Abandonment D. Death of the listing agent

Broker Abraham of Performance Real Estate was invited to list a property owned by Benjamin and Margaret Radcliff. The home was recently appraised at $275,000 by an independent appraiser but the Arapahoe County assessed value was $220,000, it is a 2743 square foot two-story home with 2163 finished square footage. The 3 Bedroom 2 ½ bath home build in 1981, has recently had carpet installed and the outside of the home repainted, but the kitchen has had no updates and the appliances, except for the refrigerator purchased one year ago, are all more than 8 years old. Prior to going on the listing appointment, broker Abraham did his due diligence in researching properties that have sold in the neighborhood and also current listings, he found two homes sold within the past two months at $250,000 and $285,000 the other four have all been sold more than a year ago at prices varying from $215,000 to $307,500. The only current listing is at $299,000, has been on the market for 75 days and is a 4 bedroom, 3 bath, with 2400 square foot home with 2250 finished, and has several upgrades that seller Radcliff's home does not have. Abraham's analysis shows that the Radcliff home should be listed at $274,900; Abraham also discovered that the property had a mold problem which was mitigated by a certified mold removal company. After making his presentation, the sellers decide they would like to work with Abraham but insist that the property be listed for $325,000. After much discussion Abraham takes the listing for 6 months at the $325,000 price with the understanding that they will review the price after two weeks; if the number of showings has been less than five, then the price will be reduced. He has also agreed that he would do open houses every weekend until the property is sold. The sellers have agreed to keep the property neat and clean and keep the dog in a kennel in the garage on scheduled showing days. After two weeks there have only been 2 showings and the price is reduced after a heated discussion to $319,000. After three more weeks of no additional showings Abraham suggested that the price should be reduced. The Radcliff's decline another price reduction and want to get out of the contract. Abraham and the Radcliff's cannot come to a termination agreement and the property stays on the market until expiration. Question: What is the Seller's disclosure responsibility regarding the mold issue? A. The Seller should disclose it to the broker in case he gets asked about it later. B. The Seller has no obligation to disclose this issue because the remediation was performed by a certified mold removal company. C. The Seller is required to disclose this situation on the Seller's Property Disclosure D. The Seller is required to provide the Buyer a copy of the mold mitigation certificate.

Broker Bill Butter is working with Buyer Brian Bread and has found a property on which the Buyer wants to place an offer. The property that he likes is owned by Seller Sammy Samuel and listed by Broker Cherry Cleary. The property is located at 2443 E Westgate Ave in Durango, CO. The asking price is $315,000. Buyer Bread offers $299,000 on April 10th and wants all appliances including the washer and dryer included in the sale price, the appliances were excluded in the listing as was the Hot Tub on the patio. The offer is countered by Seller Samuel on the recommendation of his agent Broker Cherry Cleary on April 11th at $309,000 and will include all appliances except the washer and dryer. Buyer Bread accepts this counter offer on April 12th and the closing is scheduled for May 25. An inspection is held on April 16th and Buyer Bread wants some roof shingles repaired and the carpet in the master bedroom to be replaced. Seller Samuel agrees to the shingles being repaired, but will only give a $750 credit at closing to the Buyer Bread to replace the carpet; Buyer Bread accepts. Prior to closing, Buyer Bread requests that the seller allow them to start a kitchen remodel prior to closing. Seller Samuel will not allow this and Buyer Bread gets angry and wants out of the contract How would the credit for $750 for carpet replacement be shown on the settlement statement? A. As a $750 debit to the broker and a $750 credit to the buyer. B. As a $750 debit to the seller and a $750 credit to the buyer C. As a $750 debit to the seller and a $750 credit to the broker D. As a $750 debit to the buyer and a $750 credit to the seller

Broker Bill Butter is working with Buyer Brian Bread and has found a property on which the Buyer wants to place an offer. The property that he likes is owned by Seller Sammy Samuel and listed by Broker Cherry Cleary. The property is located at 2443 E Westgate Ave in Durango, CO. The asking price is $315,000. Buyer Bread offers $299,000 on April 10th and wants all appliances including the washer and dryer included in the sale price, the appliances were excluded in the listing as was the Hot Tub on the patio. The offer is countered by Seller Samuel on the recommendation of his agent Broker Cherry Cleary on April 11th at $309,000 and will include all appliances except the washer and dryer. Buyer Bread accepts this counter offer on April 12th and the closing is scheduled for May 25. An inspection is held on April 16th and Buyer Bread wants some roof shingles repaired and the carpet in the master bedroom to be replaced. Seller Samuel agrees to the shingles being repaired, but will only give a $750 credit at closing to the Buyer Bread to replace the carpet; Buyer Bread accepts. Prior to closing, Buyer Bread requests that the seller allow them to start a kitchen remodel prior to closing. Seller Samuel will not allow this and Buyer Bread gets angry and wants out of the contract. All of the following are reasons why the buyer could get out of the contract except: A. Cannot acquire acceptable financing prior to the "Loan Objection Deadline". B. By the "Off-Record Title Objection Deadline" if there is something in the off-record documents that the buyer does not agree with. C. The buyer feels the seller is being uncooperative D. The house burns down.

Broker Bill Butter is working with Buyer Brian Bread and has found a property on which the Buyer wants to place an offer. The property that he likes is owned by Seller Sammy Samuel and listed by Broker Cherry Cleary. The property is located at 2443 E Westgate Ave in Durango, CO. The asking price is $315,000. Buyer Bread offers $299,000 on April 10th and wants all appliances including the washer and dryer included in the sale price, the appliances were excluded in the listing as was the Hot Tub on the patio. The offer is countered by Seller Samuel on the recommendation of his agent Broker Cherry Cleary on April 11th at $309,000 and will include all appliances except the washer and dryer. Buyer Bread accepts this counter offer on April 12th and the closing is scheduled for May 25. An inspection is held on April 16th and Buyer Bread wants some roof shingles repaired and the carpet in the master bedroom to be replaced. Seller Samuel agrees to the shingles being repaired, but will only give a $750 credit at closing to the Buyer Bread to replace the carpet; Buyer Bread accepts. Prior to closing, Buyer Bread requests that the seller allow them to start a kitchen remodel prior to closing. Seller Samuel will not allow this and Buyer Bread gets angry and wants out of the contract. Should you ever encourage or recommend commencing with any type of property improvements or remodeling prior to closing on the property? A. Yes B. No

Broker Bill Butter is working with Buyer Brian Bread and has found a property on which the Buyer wants to place an offer. The property that he likes is owned by Seller Sammy Samuel and listed by Broker Cherry Cleary. The property is located at 2443 E Westgate Ave in Durango, CO. The asking price is $315,000. Buyer Bread offers $299,000 on April 10th and wants all appliances including the washer and dryer included in the sale price, the appliances were excluded in the listing as was the Hot Tub on the patio. The offer is countered by Seller Samuel on the recommendation of his agent Broker Cherry Cleary on April 11th at $309,000 and will include all appliances except the washer and dryer. Buyer Bread accepts this counter offer on April 12th and the closing is scheduled for May 25. An inspection is held on April 16th and Buyer Bread wants some roof shingles repaired and the carpet in the master bedroom to be replaced. Seller Samuel agrees to the shingles being repaired, but will only give a $750 credit at closing to the Buyer Bread to replace the carpet; Buyer Bread accepts. Prior to closing, Buyer Bread requests that the seller allow them to start a kitchen remodel prior to closing. Seller Samuel will not allow this and Buyer Bread gets angry and wants out of the contract. When Seller Samuel responded to the initial offer from Buyer Bread which of the following forms should have been used? A. Agreement to Amend & Extend Contract B. Counterproposal C. Counter Offer D. Agreement to Amend & Extend Contract with Broker

Broker Price Opinions (BPO) are created by real estate licensees not appraisers. These "estimates of value" cannot be used: A. for tax purposes B. for court testimony C. to set a listing price D. to obtain financing

Broker had a property on the market last yr & knows there was a serious problem. The current owners of the property are aware of this problem, but tell the listing broker they are not going to disclose the problem to prospective buyers as buyers would not want the property and the property would not be as marketable. The agent should: A. Be obedient to the client, do nothing, and list the property B. Listing agent informs the seller they need to disclose this information on the property disclosure and if they are not willing to put this information on the property disclose the broker will not take the listing. C. Disclose the problem to prospective buyers without the owner's knowledge D. Take the listing, do not disclose the problem, but recommend to prospective buyers they perform an inspection

Broker written provisions inserted into a Commission approved form must: A. must be hand-written B. must be typed C. must be prepared by employing broker D. use a different style font from the pre-printed areas

Building Ordinances may specify & regulate: A. use of land B. zoning C. materials used in plumbing D. easements

C.C. & R.'s are appurtenances to real property. The harshest consequences results from the violation of which of the following? A. a condition B. a covenant C. a restriction D. zoning laws ***Think of witches; covenant***

Closing March 15, next payment due April 1. How many months of escrow can lender take for taxes? A. 1 B. 2 C. 3 D. 4

Closing is February 10 and taxes for the prior year were not paid for $1,854, this is shown on the settlement sheet as: A. $1,854 debit to the seller, credit to the broker B. $1,854 debit to the seller, credit to the buyer C. $152.38 debit to the seller, credit to the buyer D. $152.38 debit to the seller, credit to the broker Explanation

Colorado Real Estate Commission Rule E-4 and E-5 give direction about retaining the needed contracts after closing a transaction. Which copies are exceptions to the rules? A. Deeds, notes, trust deeds, mortgages B. Listing contract by the listing broker only C. Settlement sheets D. Any document that requires the signatures of the parties Read the question--it asked for the EXCEPTION to the rule.

Colorado is a lien theory state. This means: A. seller is released from obligation by the lender B. liens recorded against a property are normally foreclosed through the courts C. Deeds of Trust are liens and do not give the lender title to the property D. all of the above

Colorado licensing law sets a standard for: A. Marketing B. Intelligence C. Performance D. Competency and integrity

Commingling of funds in real estate means: A. putting all your money in one savings account B. that a broker mixes trust accounts with his personal funds C. buying property with your brother or other family member D. using your commission as part of the down payment

Common purpose(s) for a "buydown" of an interest rate would be: A. To help a buyer afford a more expensive home B. To help a buyer qualify for a home more easily C. To help the seller make their home more attractive to a prospective buyer D. All of the above

Comparable property "A" has central air conditioning worth approximately $2,000. Comparable property "B" does not. The subject property does not have central air conditioning. To adjust, an appraiser should: A. add air conditioning value ($2,000) to property "B" and the subject property to make them all equal B. add air conditioning value ($2,000) to the subject property, but not to comparable "B" because it's on a smaller lot anyway C. subtract air conditioning value ($2,000) from the subject property and comparable "B" because they don't have it D. subtract air conditioning value ($2,000) from comparable "A" to make it more like the subject property

Concerning a VA loan, all of the following are true except A. the borrower must sign a statement of intent to live on the property B. the loan is fully guaranteed by the government in the event of a foreclosure C. the sale price of the property cannot exceed the CRV. D. the buyer is allowed to pay discount points ***borrower is still liable to the VA***

Conventional loans: A. Are not insured by the federal government B. Never have PMI C. Are insured by the FHA D. Are guaranteed by the VA

Interest on the loan assumed is shown as:

Credit to Buyer; Debit to Seller

The seller agrees to pay $1500 of the buyer's closing costs, this is shown on the settlement sheet as:

Debit Seller; Credit Buyer

Prorated Real Estate Taxes are:

Debit to the buyer; Credit to the Seller

The purchase price is a:

Debit to the buyer; Credit to the Seller

Depreciation caused by deterioration to the physical structure is: A. Functional Obsolesence B. Physical Obsolesence C. External Obsolesence D. Deteriorating Obsolesence

Depreciation caused by forces outside the property, such as neighborhood decline or proximity to nuisances is: Functional Obsolesence Physical Obsolesence External Obsolesence Depreciation Obsolesence

Duplex owned by wife and husband. Joint tenancy. Husband dies. Husband had a will and left all assets or to son from previous marriage. What does the son receive? A. Son now owns the property B. Son does not get the property C. Son owns half of property with wife D. Son owns one of the duplex units ***Think of right of suvivorship like estates that are passed down by bloodline/generations. Even though the guy had a will, the wife will get everything first***

Each unit in a duplex, rents for $400 per month, with a sales price of $96,000, the monthly gross rent multiplier would be: A. 10 B. 120 C. 240 D. 20

4 Costs classified as Buyer's CREDITS at Closing:

Earnest Money Deposit Cash down payment Seller contribution to Buyer's costs Adjustment for over payment of closing costs

Earnest money appears on a settlement statement as a: A. Debit to the buyer B. Credit to the buyer C. Debit to the seller D. Credit to the seller Earnest money is applied towards the buyer's purchase

Employing Broker "reasonable supervision" includes all of the following EXCEPT: A. reviewing all contracts B. review transaction files C. maintaining an office policy manual D. attending first meeting with client

Encroachments may result in: A. Adverse possession after 5 years B. A permanent easement right by prescription C. A gross easement after 7 years D. Adverse possession after 7 years Explanation Encroachment can result in an easement by prescription after 18 years.

F.S.B.O. in real estate means: A. first seller buys out B. free soda and barbecue at our house C. farmer stranded behind outhouse D. for sale by owner

Factors that affect land use include: A. contour and elevation of the parcel B. prevailing winds C. availability of water D. all of the above

Fannie Mae is a: A. Government agency B. Popular name for the Federal National Mortgage Association C. A part of Ginnie Mae D. A part of Freddie Mac

To make payments for property taxes, what are the cut off dates? February 28/ June 15 March 1/ September 30 April 15/ June 30

February 28/ June 15

Federal Truth-in-Lending laws are also known as A. Equal Credit Opportunity Act. B. Freedom of Information Act. C. Regulation Z D. Title VIII

For a VA loan - how will the Buyer's Loan Processing Fee be shown on a settlement sheet A. Debit Buyer B. Debit Seller C. Debit Broker D. Not indicated on settlement sheet ***This expense is ALWAYS paid by the Seller--no exceptions***

Gertrude Greenspan wants to list her house with you. She requires $95,000 in her pocket after she pays commission and closing costs that total 9%. How much should you list her house for? A. 103550 B. 104396 C. 104550 D. net listings are illegal $95,000 / .91 (91%) = $104,396

Home inspectors: A. must be licensed B. are not licensed unless they became inspectors after Jan 1, 2002 C. are required to have 60 hours of training D. can enter the business without qualifications or training

How are real estate commissions determined in Colorado? A. set by the real estate commission B. set by law C. determined by local brokers D. negotiable between the broker and the seller or buyer

How is the relationship handled when a buyer wishes to work with a broker to locate property to purchase? A. Brokerage will be an agent for the buyer unless there is written agreement for another relationship. B. Buyer and broker must sign an exclusive representation agreement. C. Buyer will be a customer with no working relationship to the brokerage company. D. Buyer and broker may agree to a relationship which could include agency, transaction-brokerage, or no working relationship between the parties

How many credit hours of Continuing Education classes does an Associate Broker need to renew his/her license? A. 8 B. 16 C. 24 D. 32

How many days after notice of discrimination does someone have to file a complaint under Colorado Fair Housing Laws with the Colorado Civil Rights Commission? A. 30 days B. 60 days C. 6 months D. 1 year

How many times can the exclusion on capital gains taxes be claimed? A. 3 transactions over the past 12 months B. 5 transaction over the past 15 months C. 1 transaction every 24 months D. 2 transactions every 18 months

How much personal funds can you keep in the escrow account? A. none B. $100 C. $500 D. Only enough to maintain the account

If a 17 year old signs a contract is the contract: A. void B. voidable C. unenforceable D. invalid

If a broker shows a home for another broker who has it listed and a married couple comes in and he answers all questions the best he can and he promises to find out answers to the ones he doesn't know and get back to them. What type of relationship has been established? A. Implied agency B. No fiduciary relationship has been established C. Express agency D. Buyer agency

If a contract is signed under duress, it is: A. Bleached B. Discharged C. Voidable D. Void

If a friend asks you to help manage a property for a fee, would you put the deposits into your escrow account or your employing brokers escrow account? A. Deposit them into your escrow account B. Deposit them into your employing brokers escrow account

If a licensee is in court, the following has (have) jurisdiction over him: A. the court B. the Real Estate Commission C. both the court and the Real Estate Commission D. NAR and the court

If a man dies without a will, how will his estate be divided between his wife and three children? A. all to his wife B. ½ to his wife, ½ to be divided among the children C. ¼ to each his wife and children D. ½ to his wife and ½ to his ex-wife The estate is divided by bloodline 1st and then generation

If a property owner tells you the land only flooded during the "great flood" over 100 years ago, a licensees obligation to a potential buyer is.... A. provide them with necessary documentation and assure them that there''s nothing to worry about B. direct them towards the public records which would specify whether the land is in a flood zone C. assure them there is nothing to worry about because the flooding only occurs every 100 years D. recommend the install necessary infrastructure to avoid future flooding.

If a purchase agreement says to release earnest money after the inspection date, then the seller demands the money be release prior to the inspection date. What should the broker do? A. refuse to release the earnest money B. tell the buyer of the situation C. release the earnest money

If a seller is selling a property, but needs to wait on the buyer to sell their other house before they can buy, what should they do, so they do not have to wait around forever. Add an escape clause to the purchase contract Add a buyer financing contigency clause to the purchase contract Add a rejection clause to the purchase contract Reject the buyers offer

If a seller prepares a counterproposal, to an offer to buy and it is turned down by the buyer: A. the seller can still accept and hold the buyer to the original offer, if it has not terminated B. the buyer must resubmit their original offer one more time C. the original offer made is valid D. the buyer can prepare a counter to the counteroffer

If an Asian family is looking for a home, you must assume they would want a home in: A. a predominantly Asian community B. a good neighborhood C. any neighborhood D. a predominantly black neighborhood

If an agent forgets to renew her license and submits the application to renew 30 days late. The status of her license during this 30 day period is: A. active B. suspended C. expired D. inactive

If an agent has a listing and transfers companies, does the listing stay with him/her and the new company OR does the listing remain with the original company? A. It is thee agent's listing, the listing transfers with the agent. B. It is the company's listing, the company keeps the listing.

If an agent is to execute an instrument under seal for his principal, his authority to do so must: A. come from a power of attorney B. be in writing C. be irrevocable D. be derived from an instrument of equal dignity with the act to be performed

If an employing broker leaves a real estate brokerage, what happens to the transaction records? A. the brokerage retains the records as the company is responsible for maintenance of records B. the departing broker is personally responsible for delivering all such records to to his/her new brokerage C. all funds in escrow must be returned to the rightful parties before being re-deposited with the new brokerage. D. the real estate brokerage can dispose of all records acquired while the former employing broker worked for the company

If an owner wants to make a single full payment for property taxes, what is the latest date by which this payment can be made? A. March 1 B. April 30 C. May 1 D. June 16

If items listed in the Inclusions and Exclusions Section of of the Contract to Buy and Sell Real Estate are not a part of the property, the broker should: A. do nothing, if the listing item is not on the property as of the date of the contract, it is not included nor necessary to cross it out B. cross out the items to show they are not included C. if not crossed out the seller could be obligated to install the item D. check the appropriate box

If the assessed valuation of a property is $200,000, with a tax rate of $4.00 per $100, what is the annual tax? A. 8000 B. 6600 C. 4600 D. 2000 $4.00 per $100 means that the $200,000 must be divided by 100, giving a total of $2,000. That, multiplied by $4.00 gives the total tax of $8,000

If the buyer and seller have not reached a resolution on inspection issues the contract will terminate: A. one day following the resolution deadline. B. on the expiration of the resolution deadline. C. one day following the objection deadline. D. on the objection deadline.

If the buyer assigns her right to purchase a property pursuant to an exclusive right-to-buy contract to her brother-in-law: A. the broker is no longer entitled to a commission B. the broker shall still have the right to collect a commission C. the broker may only collect a commission if the brother-in-law signs an exclusive right-to-buy contract D. the broker may only collect a commission if the listing broker feels that the selling broker has earned it ***The brokers right to collect a commission is specifically protected in the exclusive right to buy contract, even if the buyers right to purchase is assigned to another party.***

If the closing is March 15, and last years taxes of $1127 were not paid; how is this shown on the settlement sheet? A. $1127 debit to the seller, credit to the broker B. $1127 debit to the seller, credit to the buyer C. $225 debit to the seller, credit to the broker D. $225 debit to the seller, credit to the buyer

If the contract calls for a closing on or before December 30 and the purchaser wishes to close on December 22, the following must happen: A. the purchaser and seller must agree to the new date B. there does not need to be agreement C. the Title Company can decide if it can close D. it is decided by the person responsible for setting the time and place of closing

If the homeowner association charges a transfer fee to the new owner of the property, who normally pays this? A. Negotiable B. Always paid by the seller C. Always paid by the buyer D. There is no such thing as a transfer fee

If the seller finds out he is not being transferred and defaults on the sales contract: A. it depends if specific performance or liquidated damages was checked B. the listing agent can force the sale C. neither agent is entitled to commission since the deal never closed D. the buyer can sue him for specific performance and damages

If the transaction does not close: A. the broker has the right to unilaterally declare a forfeiture of the earnest money B. the broker may only declare a forfeiture of earnest money upon (written) instruction of the seller C. the title company may declare a forfeiture of earnest money D. the lender may declare a forfeiture of earnest money

If there is no Legal Description of a property in a Purchase and Sell contract, is the contract: A. Void B. Enforceable C. Unenforceable

In Colorado "good funds" include a A. A personal check from the buyer that will clear the bank B. A title insurance company check C. A check drawn on the broker's escrow account D. A teller's check from a savings and loan

In Colorado, all of the following would be required to obtain a real estate license except: A. a time share salesperson B. a rental referral agent C. a property manager D. a commercial real estate broker

In Colorado, when must real estate licenses be renewed? A. every three years with expiration on December 31 of the third year B. every three years on the anniversary of licensing. C. each year at the anniversary of licensing D. every three years if the licensee passes the state examination

In Colorado, which of the following must be investigated by the real estate commission? A. any verified written complaint B. at least five percent of all brokers annually C. disputes between brokers regarding commission D. any licensee accused of a crime

In a buyer-agency situation, what responsibility does the agent have to the principal? A. To be vicariously liable for their actions B. To pay a commission C. To disclose psychologically impacting events surrounding a property D. To be an advocate of the buyer's best interests

In a condominium, the best term to describe swimming pools and laundry rooms for the use of unit owners is: A. Common elements B. Limited common elements C. Cooperative elements D. Tenancy elements

In a contract to purchase in which the buyer is assuming a non-qualifying loan from the seller: A. since the loan is non-qualifying, the seller cannot ask the buyer for financial information B. the buyer must provide financial information to the seller C. the seller may ask for financial information, but cannot refuse the offer based on the information provided if the contract is for full price D. the seller may ask for financial information and terminate the contract if the information is unacceptable Seller is furnishing the money, so they have the right to request the financial docs

In a new loan closing, sometimes a lender may make some of the payouts, such as recording fees, survey and reserve taxes before the closing. When these amounts are taken out of the loan, the remaining balance is the amount sent to the closing table and is called the Net Loan Proceeds. The Net Loan Proceeds are entered on the settlement worksheet as a: A. debit to the broker, single entry B. credit to the broker, single entry C. debit to the buyer, credit to the broker D. credit to the buyer, debit to the broker

In a transaction that is subject to a licensee buyout agreement, if the buyer defaults the seller may: A. sue the buyer if the specific performance box has been checked B. always sue the buyer for specific performance C. only keep the buyer's earnest money as liquidated damages D. keep the buyer's earnest money as liquidated damages if the liquidated damages box has been checked

In accordance with the Doctrine of Emblements, emblements legally belong to the: A. landlord B. state Senator C. tenant farmer D. descendant's estate

In addition to Federal law the Colorado Fair Housing Act added as a protected class: A. Sexual orientation B. Marital status C. Sexual orientation and marital status D. Students Only Marital Status--think of a guy couple marrying.

In addition to taking the required 168 hours of course instruction to become an associate broker, one must also: A. pass the state side of the broker's exam B. hang their license under an employing broker or set up your own office C. work as an assistant broker for three months D. hang their license under an employing broker

In analyzing gross income of a property, the characteristic of the income that the appraiser is concerned with is: A. quantity B. quality C. durability D. all of the above

In compliance with the ADA, all architectural barriers in existing facilities must be removed: A. if removal is "readily achievable" B. even if at great expense C. only if someone complains D. when you hire disabled persons

In dual agency, which duty would be the easiest to carry out for both clients? A. Care B. Obedience C. Loyalty D. Disclosure

In order for the appraiser to obtain access to the property, he or she must first obtain permission from the: A. listing agent B. Title Company C. buyer D. selling agent

In order to establish in court that you, an agent, are entitled to a commission, which of the following could you exclude? A. establishment of agency B. procurement of a ready, willing and able buyer C. existence of an Exclusive Right to Sell Listing contract D. either consummation of the sale or defeat of the sale by refusal or neglect of the seller Question is asking which of these would exclude you from proving you as a broker were entitled to a commission? (didn't understand the question)

In order to foreclose a mortgage, a mortgagee would: A. notify the trustee of default B. file an attachment in the amount of the debt C. notify the mortgagor of default, wait 90 days, and publish a notice of default in the local paper D. file a court action

In representing a buyer in an agency relationship, the broker has a fiduciary responsibility. These duties include: A. care, obedience B. accounting, loyalty C. disclosure D. all of the above

In the Colorado Brokerage Relationship law, the seller's agent may not disclose which of the following to the buyer? A. All adverse material facts about the title to the property B. All adverse material facts about the property C. All of the environmental hazards effecting the property D. All adverse psychological impacts or stigmas about the property

In the Colorado Contract to Buy & Sell encumbrances to be paid by the seller: A. Must be paid prior to closing B. Must be paid at or before closing C. Must not be paid from proceeds from the sale of the property D. May be paid by the seller after closing ** The encumbrances just have to be paid before the property can be transferred to the new owner***

In the Colorado Listing agreement the holdover period provision entitles the broker to a commission if the property sells to anyone: A. The broker negotiated with during the listing period unless the seller lists with another exclusive broker and the "Will" box has not been checked B. Within a stated period after listing expires C. The broker negotiated with during the listing period D. Within the listing period ***the default is for will not***

In the event of a foreclosure, a special assessment: A. has priority as of the date of recording B. is always paid first C. is paid second, after general property taxes D. has priority as of the date that work on the improvement began

In the event of a lawsuit arising from a Commission-approved Purchase/Sale Agreement, a court must necessarily: A. award damages and court costs to the buyer B. award damages and court costs to the seller, if it's a specific performance contract C. award damages and court costs to the prevailing party D. award damages and court costs as the judge sees fit

In the income approach to value, the net income is determined by deducting the expenses from the: A. operating profit B. gross income C. effective gross income D. none of the above

In the section on Purchase Price and Terms in a Residential Contract to Buy and Sell, which of the following is true concerning the entry for cash at closing? A. It represents the total amount the buyer should plan to bring to closing. B. It should match the good-faith estimate provided with the HUD-1 form. C. It represents the approximate amount the seller will receive at closing. D. It does not include the buyer's closing costs, such as loan fees

In using the market data approach: A. Adjustments are made by adding to or subtracting from the comparable property B. Adjustments are made by adding to or subtracting from the subject property C. The appraiser does not make adjustments for time of sale D. The appraiser does not make adjustments for differences in physical characteristics

Interest charged on amortized loans: A. is normally paid in advance as evidenced at closing B. is adversely affected by the supply of loan funds C. declines in ratio directly proportionate to the declining loan balance D. may be augmented by mortgage discount points to increase the mortgagee's yield

Interest in arrears is charged to the: A. Buyer B. Seller C. Broker D. Lender

Jeff's land has an easement to cross Bill's property. Jeff subdivides his property and sells to Charlie. Which statement is true? A. Land benefiting from an easement cannot be subdivided B. Both Jeff's and Charlie's land have easement rights C. Jeff's land retains the easement, but Charlie's does not D. The easement no longer exists

One requirement for valid transfer of title to property by deed is A. words of conveyance B. witnesses C. recordation D. signature of the grantee

John Brown submits an offer to purchase contingent upon the sale of his present home on or before June 15. The seller accepts the offer, and on June 16 the home is still not sold. A. the buyer need not do anything since his property has not sold B. the buyer may extend the date for the contingent property to sell C. the seller may sue for damages D. the seller may terminate the contract and return the earnest money

Julie worked for ABC Realty she had a listing which was sold by Mary. But before it closed Julie joined ZZZ Realty. What should happen to Julie's commission? A. She switched companies so she lost the commission B. She should be paid by ZZZ Realty C. She should be paid by ABC Realty D. It should be paid to Mary

Just before the close, the buyer noticed a broken window and a man-door hanging by one hinge in the detached garage, her inspector had missed these as he considered outbuildings as outside the scope of the inspection. What is the buyer's recourse? A. Seller must fix window B. Buyer's responsibility because she had missed the inspection deadline. C. The Inspector is at fault D. Buyer may terminate the agreement or negotiate a settlement with the Seller

Just before the close, the buyer noticed a broken window and a mandoor hanging by one hinge in the detached garage, her inspector had missed these as he considered outbuildings as outside the scope of the inspection. What is the buyer's recourse? Seller must fix window Buyer's responsibility because she had missed the inspection deadline. The Inspector is at fault Buyer may terminate the agreement or negotiate a settlement with the Seller

K and R bought a house as tenants in common. If K dies, which of the following statements about ownership is correct? A. It automatically becomes tenancy in severalty B. R holds fee simple ownership in K's share of the property C. R holds life estate ownership in K's share of the property D. It is divided, with R retaining R's original interest and the balance going to K's estate

Kevin, a real estate broker, sold a property and received a 6-1/2% commission. Kevin gave the listings broker 30% of the commission, or $3,575. What was the selling price of the property? A. 55000 B. 95775 C. 152580 D. 183333 3575/30% = 11,916.67 11,916.67/6.5% = $183,333

Kurt and Julie your clients found a development they would like to look at. After showing them the new homes, your buyer's decide to purchase one, you should: A. immediately fill out the residential contract to buy and sell real estate B. take your buyers to the home site and have the builder prepare their contract C. send your buyers on their way because you cannot do new home sales D. have your buyers complete an exclusive right-to-buy contract ***Builders don't play by the REC rules, so just shuttle the buyers straight to the development***

Name 7 costs classified as Seller DEBITS during a Closing

Landscaping Upgrades Real Estate commissions Property Taxes/ Assessments (past due & current) Home Repairs

Legal tests of a fixture include all of the following except: A. intention of annexation B. method of annexation C. how they were purchased D. existence of an agreement

Licensees are NOT required to use the Licensee Buyout Addendum to Contract to Buy and Sell under which of the following circumstances? A. When the licensee enters into a contract to purchase a property concurrent with the listing of such property B. When the licensee enters into a contract to purchase a property as an inducement or to facilitate the seller's purchase of another property C. When a licensee enters into a contract to purchase a property from the owner but continues to market it for that owner under an existing listing agreement D. When an agent decides to purchase a property listed by another broker **Only need to use the addendum if purchasing a property that is your OWN listing**

Listing information: A. may be added outside the body of a contract as an attachment B. can never be added outside the body of a contract C. may be obtained after the listing agreement has been signed by the buyer and the broker D. none of the above **MLS, etc...***

Loan discount fees are paid by: A. broker B. buyer C. seller D. seller or buyer

Loan discount points appear on a closing statement as a: A. Debit to the buyer or seller B. Credit to the buyer C. Debit to the broker D. Credit to the seller

Loan discount points are a percentage of the: A. Purchase price B Loan amount C. Loan origination fee D. Amount due from the buyer ***1 discount point is 1% of the total loan amount***

Loan fraud can have the following results to a real estate licensee except: A, criminal action filed in criminal court B. disbarred by HUD from all federal programs C. end of a career in real estate D. no action taken

Loan fraud can have the following results to a real estate licensee except: A. criminal action filed in criminal court B. disbarred by HUD from all federal programs C. end of a career in real estate D. no action taken

Mary is a broker in Colorado for ABC Real Estate. Mary's client John wants to purchase a home that Mary has listed. Mary must: A. terminate the buyer agency agreement and let John become a customer B. terminate the buyer agency and let John find another agent C. become a Transaction Broker to both parties D. any one of the above is correct

Mineral rights: If property is attached with mineral rights, you may be obligated to: A. charge a rate for entry B. refuse entry C. allow them to enter an use your property to gain access to the minerals D. call police

Money realized in excess of the indebtedness and the foreclosure belong to: A. the court B. the PMI, FHA, or VA, whichever insured the loan C. mortgagee D. mortgagor

Comparable Sales Method

Most reliable way of calculating a Capitalization Rate

Mr. Ackerman leased a property for five years to Mr. Bones. During this term, Mr. Ackerman died and then Mr. Bones discovered that Mr. Ackerman's interest was a life estate. The owner of the property was correct in advocating which of the following? A. Mr. Bones' leasehold estate is valid for the length of the lease B. Mr. Bones' interest was terminated upon Mr. Ackerman's demise C. Mr. Ackerman's heir would receive the fee title D. The owner has an estate in remainder

Mr. Davis was assessed by the city 6 cents per square foot of his property as a special assessment, his property measured 80 X 135. What did the special assessment cost him? A. 64.8 B. 648 C. 6480 D. 592.75

Mr. Jones has a property valued at $150,000. The 2003 taxes were 27.65 mills. In 2004 the mill levy was reduced to 25 mills but the assessed value increased 10%. Did the taxes: A. stay the same B. increase C. decrease D. none of the above

Mr. and Mrs. Seller give an exclusive 90-day listing to broker First. The broker shows the property to Mr. and Mrs. Buyer and he reveals their names to the Sellers. The buyers do not make an offer. The listing with broker First expires and the sellers sign a new exclusive right to sell 60 day listing with broker Second. Two weeks later the Buyers decide to purchase the property through broker First. If the Buyers purchase the property, who is entitled to a commission? A. broker First B. broker Second C. both brokers D. neither broker Explanation Broker First is entitled to the buying commission Broker Second is entitled to the listing commission

Does a Deed need to be acknowledged to be valid?

Once a plat is approved, what step must be taken prior to the lots being sold? A. building permits must be issued B. the site must be cleared and leveled C. the appropriate governmental authority must approve zoning D. The plat map must be recorded

On a real estate closing transaction involving an exclusive-right-to-sell listing, the commission would be a debit to the: A. buyer and a credit to the seller B. seller and a credit to the buyer C. seller D. buyer

On a service property, (i.e. church, school), which approach to value is most reliable? A. Income approach B. Sales comparison approach C. Cost approach D. Gross multiplier **These are public, NON-INCOME producing building, and can only use the cost approach method. Sales Comparison would be reserved for property that is frequently sold***

On a service property, (i.e. church, school), which approach to value is most reliable? A. Income approach B. Sales comparison approach C. Cost approach D. Gross multiplier

One of the required elements of a valid real estate contract is that it must: A. Provide for installment payments B. Provide for possession of the property by the buyer C. Be signed by the seller D. Contain a metes and bounds description of the property

Partial lease interests were transferred by a lessee. This is a(n): A. step-lease B. gross lease C. assignment D. sublease

Payment of the broker's commission: A. does not establish agency B. establishes an agency relationship C. determines loyalty D. implies vicarious liability

Personal property includes: A. chattels B. fructus industriales C. emblements D. all of the above

Plans have been announced for a multimillion-dollar shopping center to be built next door to a vacant lot you own. Property values in the area of the area of the proposed site will tend to increase as a result of this announcement. This is an example of the principle of: A. anticipation B. highest and best use C. supply and demand D. substitution

Possession under a claim of adverse possession must be: A. open, notorious, and hostile B. open, hostile, and continuous C. notorious, hostile, and continuous D. open, hostile, notorious, and continuous

Priority of judgment liens would be based on the: A. date of the debt B. date of the lien recording C. amount of the debt D. the foreclosure process

Property taxes are based on an assessed value of $132,000 and the tax rate is 8.5 mills. The property closes on Jun 14. On a basis of the banker's calendar (360 day year, every month is 30 days) the seller owes how much in taxes? A. 3432 B. 2211 C. 1122 D. 511 $132,000 X .0085 = $1,122 / 360 = $3.1166 X 164 = $511.13

Property taxes are based on an assessed value of $132,000 and the tax rate is 8.5 mills. The property closes on Jun 14. On a basis of the banker's calendar, the seller owes how much in taxes? A. 3432 B. 2211 C. 1122 D. 511 ***$132,000 X .0085 = $1,122 / 360 = $3.1166 X 164 = $511.13***

Property taxes become a lein on January 1 for the previous year. When may taxes be paid without receiving a penalty: A. The first half payment by the last day of February, the second half payment no later than June 15 B. All payments no later than Dec 31 C. All payments by October 15 D. half payment by April 1, second half payment by July 1 ***If making a lump-sum payment, it's due no later than April 30. If making 2 payments; 1st paymt is due last day of February, and 2nd paymt is due no later than 6/15***

Prospective buyers made an offer on a property. The seller did NOT accept, but made a counteroffer. The prospective buyers signed the counteroffer and the real estate agent delivered their acceptance to the seller. In the interim, the same buyers found another house that they liked better and made an offer on it, which was accepted. Which of the following is TRUE? A. Neither contract is enforceable B. Only the first contract is valid C. Both contracts are valid D. The contract on the first house is not enforceable

Pursuant to an exclusive right-to-buy contract, a broker: A. may always show the same property to another buyer B. may not show the same property to more than one buyer C. may show the same property to another buyer only if a buyer-agency relationship has been established D. may show the same property to another buyer only if a transaction broker relationship has been established

Quieting the title on a piece of property is a court action that would: A. divest the owner of record of title to the property B. remove specific claims against the property C. release the deed restrictions D. transfer ownership of the property

RESPA requires the lender to provide a Loan Estimate of the borrower's closing costs: A. One day prior to closing B. Before a loan origination fee may be charged C. Within three days of loan application D. If those numbers are different than the broker anticipated

Real estate transactions may require the services of: A. real estate attorneys B. title companies C. real estate attorneys and title companies D. real estate attorneys, title companies, and accountants

Real property is closing on May 14. The buyer is assuming the seller's mortgage. As of closing the balance is $65,325. The annual interest rate is 8%. How should the interest on the loan be prorated based on a banker's year (360 days in a year, all months have 30 days) A. Debit the buyer $232.32 B. Debit the seller $232.32 C. Debit the buyer $203.23 D. Debit the seller $203.23 Explanation $65,325 x 8% / 360 days = $14.5167 x 14 days = $203.23

Real property is closing on May 14. The buyer is assuming the seller's mortgage. As of closing the balance is $65,325. The annual interest rate is 8%. How should the interest on the loan be prorated based on a banker's year(360 days in a year, 30 days in a month) . A. Debit the buyer $232.32 B. Debit the seller $232.32 C. Debit the buyer $203.23 D. Debit the seller $203.23

Reconciliation refers to which of the following? A. Loss of value to any cause B. Separating the value of the land from the total value of the property to compute depreciation C. Analyzing the results obtained by the different approaches to value to determine a final estimate of value D. Process by which an appraiser determines the highest and best use

Recording fees may appear on a closing statement as a: A. Debit to the buyer B. Debit to the seller C. Credit to the broker D. All of the above ***anyone can pay recording fees***

Regarding a dispute over Earnest Money - if no lawsuit is filed, the broker may: A. surrender the money to the state Real Estate Commission B. surrender the money to the court in an interpleader action C. surrender the money to the party with the best lawyer D. surrender the money to the court by way of "Notice of Appearance".

Regarding an Earnest Money dispute - if a lawsuit is filed, the broker may: A. surrender the money to an interpleader B. surrender the money in an interpleader action and request to be removed as a defendant C. surrender the money to the state Real Estate Commission D. surrender the money to the party with the best lawyer

Regarding delivery of Earnest Money: A. It must be delivered at the time of tender of this contract B. If other than at the time of tender of this contract it must be delivered no later than the Alternative Earnest Money Deadline C. If other than at the time of tender of this contract it must be delivered no later than the Earnest Money Deadline

Right of rescission is part of: A. Real Estate Settlement Procedures Act (RESPA) B. Truth in Lending Act C. Consumer Protection Act D. Fair Housing Act

Roberto and Maria Martinez have a new loan in the amount of $80,000. The interest rate is 10%. The monthly payments are $710, principal and interest. What is their loan balance after the they make two month's worth of loan payments? A. 80000 B. 79929 C. 79913 D. 78580

Sandy Jacobs and Eva Cole bought a store building and took title as joint tenants. Cole died testate. Jacobs now owns the store: A. as a joint tenant with right of survivorship B. in severalty C. in absolute ownership under the law of descent D. as a tenant in common

Is the Vendor the Seller or the Lender

Seller

Seller is giving the buyer a contingency but doesn't want to be stopped from selling forever. The seller should consider: increasing the earnest money get proof of buyer financing refuse the contingency countering with an escape clause

Seller's proceeds are shown at the bottom of a six-column settlement worksheet as a: A. debit to the seller B. credit to the seller C. credit to seller, debit to the broker D. debit to the broker

Since much of your real estate business is done when other people are not working, a real estate office should: A. be available to the public B. be open 24 hours a day C. be open at least three days a week D. be open only on weekends and evenings

Single party listings: A. no holdover provision B. no disclosure is necessary C. no contract to perform is necessary D. not applicable to the Statute of Frauds

Smith and Jones are joint tenants. Smith sells her interest to Brown. What is the relationship between Jones and Brown? A. They are tenants in common B. They are joint tenants C. They each have ownership in severalty D. The are tenants in entirety

Smith owned a home subject to a bank loan. After living there a year his cesspool caved in and he contracted to have a new one dug and connected. About that time, he lost his job and couldn't pay his bill. The contractor filed a mechanic's lien. Then the bank foreclosed and sold the property for the amount the borrower owed them. Which of the following is true? A. The bank secured title subject to the mechanic's lien B. The contractor loses out; the bank's lien was recorded first C. The mechanic's lien has first priority from the proceeds of the sales D. A holder of a mechanic's liens can never recover from a foreclosure

Someone living in a condominium exclusively owns: A. The walls separating the units B. The carpet inside the unit C. The building elevator D. The balcony outside the unit

Standard title insurance charges appear on a closing statement as a: A. Credit to the buyer B. Credit to the seller C. Credit to the broker D. Debit to the broker

Principle of Supply and Demand

Supply--the amount of product that can be offered by a market Demand--the willingness and ability of buyers to purchase products

Susan Seller gave her agent a 60 days listing to sell her home for $200,000. The seller specified in the Exclusions section of the listing agreement that her prized Iris plants would be removed prior to close and the iris bed repaired to eliminate the damage of plant removal. Public records indicates the home is 2,400 square feet, has 3 bedrooms, 2 bathrooms, a 90% finished basement and a two car garage. Last year's taxes were $1,832 and have been paid. An offer was made and accepted with a sales price of $190,000. The buyers submitted earnest money of $3,000 under liquidated damages. The inspection objections must be made by March 27. The survey must be completed by April 10. Review of title must be completed by April 10. The Sellers indicated in the seller's property disclosure that the water heater had leaked. The water heater was replaced and all water damage repaired. The sellers further disclosed that the concrete basement floor had lifted due to expansive soils creating a crack in the concrete floor. Although closing was set for May 1st, a delay in the lender processing of the buyer's loan forced a change in close to May 10th. This change was accepted by both parties. The cost of the survey was $450. The closing fee charged by the closing company is $150 to be split by both parties. After moving in the buyers realized the Iris plants had been removed: A. The buyers have no recourse as the removal had been communicated by the seller to the listing broker B. The listing contract takes precedence in a sale, the listing broker may consider making a concession to the buyer for damages C. The seller is bound by the terms of the purchase contract, the listing broker might consider offering a financial concession to the buyer for damages D. The buyer agent is at fault and may consider making a financial concession to the buyers

Susan Seller gave her agent a 60 days listing to sell her home for $200,000. The seller specified in the Exclusions section of the listing agreement that her prized Iris plants would be removed prior to close and the iris bed repaired to eliminate the damage of plant removal. Public records indicates the home is 2,400 square feet, has 3 bedrooms, 2 bathrooms, a 90% finished basement and a two car garage. Last year's taxes were $1,832 and have been paid. An offer was made and accepted with a sales price of $190,000. The buyers submitted earnest money of $3,000 under liquidated damages. The inspection objections must be made by March 27. The survey must be completed by April 10. Review of title must be completed by April 10. The Sellers indicated in the seller's property disclosure that the water heater had leaked. The water heater was replaced and all water damage repaired. The sellers further disclosed that the concrete basement floor had lifted due to expansive soils creating a crack in the concrete floor. Although closing was set for May 1st, a delay in the lender processing of the buyer's loan forced a change in close to May 10th. This change was accepted by both parties. The cost of the survey was $450. The closing fee charged by the closing company is $150 to be split by both parties. The buyers did not show up to the closing, nor did they complete the loan application. The seller may: A. Keep the earnest money and sue for damages B. Must return the earnest money to the buyers as they did not qualify for a loan C. Keep the earnest money, there is no recourse in the agreed purchase contract for a suit for damages

Susan Seller gave her agent a 60 days listing to sell her home for $200,000. The seller specified in the Exclusions section of the listing agreement that her prized Iris plants would be removed prior to close and the iris bed repaired to eliminate the damage of plant removal. Public records indicates the home is 2,400 square feet, has 3 bedrooms, 2 bathrooms, a 90% finished basement and a two car garage. Last year's taxes were $1,832 and have been paid. An offer was made and accepted with a sales price of $190,000. The buyers submitted earnest money of $3,000 under liquidated damages. The inspection objections must be made by March 27. The survey must be completed by April 10. Review of title must be completed by April 10. The Sellers indicated in the seller's property disclosure that the water heater had leaked. The water heater was replaced and all water damage repaired. The sellers further disclosed that the concrete basement floor had lifted due to expansive soils creating a crack in the concrete floor. Although closing was set for May 1st, a delay in the lender processing of the buyer's loan forced a change in close to May 10th. This change was accepted by both parties. The cost of the survey was $450. The closing fee charged by the closing company is $150 to be split by both parties. The buyers inspector noticed the damage to the basement floor and communicated this information to the buyer on March 20th. A. The purchase contract is still binding as the listing broker guarantees the floor will be repaired by closing B. The purchase contract is still binding as the crack was disclosed in the seller property disclosure C. The buyer may terminate the purchase contract in writing. The buyer also has the option to negotiate a repair cost with the seller

Taxes for the current year are charged to the seller: A. From day of closing until the last day of the year B. From the first day of the year until the day prior to closing C. Only if the buyer is not obtaining a new loan D. As agreed upon in the contract to buy and sell

Is the Vendee the Buyer or the Seller

The Buyer

The Certificate of Taxes Due is used to calculate: A. the proration of taxes for the final tax agreement B. the amount of taxes due pursuant to the Real Property Transfer Declaration C. the amount of the transfer tax to be collected at closing D. whether or not the sale will be subject to Colorado income tax withholding

The Colorado Contract to Buy & Sell allows the Buyer who cannot get a written loan commitment by the Loan Objection Deadline: A. to terminate the contract by written notice and receive earnest money back B. to automatically extend the closing date to automatically extend the Loan Objection C. Deadline to no later than that of the closing date D. to terminate the contract and limit the default penalty to liquidated damages

The Colorado Contract to Buy & Sell states that "time is of essence hereof". This statement means that: A. All dates and deadlines must be performed within a reasonable margin of the stated time or date B. Everything not done by closing will be waived C. Everything in the contract must be complete within one year D. Dates and deadlines will be strictly interpreted

The Colorado Statute of Frauds mandates that A. Oral contracts are enforceable B. Sellers must disclose material facts about the property C. Contracts for the sale of property must be in writing D. Brokers may not misrepresent facts

The Colorado Statute of Frauds requires what in order for the contract regarding real estate to be enforceable? A. To be written by an attorney B. To be in writing C. To be signed by only the buyer D. That an agent cannot misrepresent the facts

The Contract to Buy and Sell Real Estate, who signs this? A. Buyer B. Seller C. Broker D. All of the Above

The Definitions of Working Relationships form has the effect of: A. establishing an agency relationship B. disclosing the different types of relationships that are available C. complete disclosure of agency as required by Colorado statute D. disclosing only the types of relationships that the broker prefers to offer

The Exclusive Brokerage Listing Addendum attached to an Exclusive Right to Sell Agreement A. Removes the seller's vicarious liability for activities of the broker B. Eliminates the broker's confidentiality duties C. Allows the seller to sell to anyone after the listing period is expired D. Allows the seller to negotiate a sale and not pay the broker

The Government's police powers enable the state to regulate and control the use of land through A. Condemnation. B. Special assessments. C. Escheat. D. Zoning Laws.

The Internal Revenue Code provides for tax-deferred exchanges only of: A. Residential property B. Commercial property C. Urban property D. Like kind property

The National Association of Realtors is responsible for establishing: A. real estate law B. real estate licensing requirements C. the Code of Ethics D. real estate referral networks

The PRIMARY purpose of zoning ordinances is to A. regulate business districts B. establish appropriate boards for appeal C. implement a local master plan D. control the quality of building materials

The Real Estate Commission approved Colorado Power of Attorney form A. creates a limited agency agreement B. is required in foreclosure sales C. creates a universal agency agreement D. may be used in place of a buyer agency agreement

The Real Estate Commission has the authority to audit or investigate a licensee and their files: A. at any time without advance notice B. at any time with advance notice C. only when a complaint has been filed

The Residential Contract to Buy and Sell includes various provisions that call for notification to one of the parties about various events or objections. Which of the following is correct with regard to whom the notification must be delivered? A. Notice may be sent to the broker but is legally delivered only when received by the party. B. Notice is legally delivered when received by either the party or the broker working with that party. C. Notice must be delivered directly to the party and not its broker. D. Notice to the party must be by "normal channels of communication," such as telephone, mail, or fax

TheUniform Consumer Credit Code as adopted by Colorado restricts the interest rate on loans under $3,000.00 made by a private lender to a maximum of: A. 0.21 B. 0.45 C. 0.18 D. 0.36 It's 21% for loans UNDER $3,000 and 45% for loans OVER $3,000

The activities of Fannie Mae include: A. insuring mortgages B. guaranteeing mortgages C. raising and lowering the federal discount rate D. purchasing mortgages originated by others

The amend\extend form is used to change the terms of: A. an offer being negotiated B. an exclusive right-to-sell listing contract C. an accepted purchase and sale contract D. an exclusive right-to-buy contract **Look for the word "accepted" in the answer choices.

The amount due from buyer at closing is shown as a: A. debit to the buyer B. debit to the buyer, credit to the broker C. credit to the buyer D. credit to the broker

The amount due from the buyer appears on a closing statement as a: A. Credit to the broker B. Credit to the seller C. Credit to the buyer D. Debit to the buyer **Remember--the closing is over

The approved Agreement to Amend/Extend contract form is used: A. To notify the Seller of any change in deadlines B. Add information to an offer that does not belong in "additional provisions" C. To notify the Buyer of a deadline they missed D. To get mutual agreement of the parties to any change in a deadline

The area between two non-compatible zoning areas is called: A. guard zone B. a battle zone C. a buffer zone D. a non-conforming zone

The authority to carry out eviction of a delinquent tenant from rented property is held by: A. a landlord B. the sheriff C. any of the above LL can request the eviction, but a sheriff has to carry it out.

The broker is required by statute to present: A. all offers prior to one being accepted B. all offers including those received subsequent to an accepted offer C. all reasonable offers D. all offers with no contingencies

The buyer agent of company P closed on a property on Tuesday. The buyer agent should bring the completed file and commission check to the broker: A. as soon as possible B. by Friday C. after dinner and a celebration cocktail D. before the property closes

The capitalization rate has considerable effect upon the appraised value of property. Which of the following statements is true? A. The capitalization rate consists only of the component related to return on investment B. An increase in the capitalization rate produces an increase in the appraised value C. A decrease in the capitalization rate produces an increase in the appraised value D. The capitalization rate will be higher for property where a long-term tenant has shown a good record of payment than for one with a relatively new tenant with a poor record of payment

The characteristic of being unique means that: A. identical buildings placed on two separate parcels have the same value B. geographically, all parcels of real estate are different C. two parcels of land next to each other are sometimes dissimilar D. all of the above

The closing statement is prepared to: A. determine the amount of money the seller will receive at the closing B. compute the amount of money the purchaser must bring to the closing C. serve as a receipt for all money that changes hands at the time of closing D. all of the above

The co-op offered in the MLS is determined by: A. MLS B. the office policy C. the seller and buyer D. the seller and listing broker

The concept holding that real estate values are constantly in flux in response to various social, economic, governmental and environmental forces is called the: A. principle of substitution B. principle of change C. principle of supply and demand D. principle of competition

The covenant of quiet enjoyment is best described by which answer. A. The grantor guarantees the title against claims of a third party. B. The grantee warrants she is the owner of the property and has the right to convey title. C. The grantor guarantees that if the title fails in the future, the grantor will buy back the property at fair market value. D. Third party claims will not affect the grantor.

The decrease in value because of outmoded function is known as: A. functional obsolescence B. deterioration C. economic obsolescence D. depreciation

The degree, quantity, nature, and extent of interest which a person has in real property is called an estate. Which of the following is an estate? A. Easement B. Sublease C. Mortgage D. Holder in due course A sublease is an estate since it is an interest in a property; a leasehold interest

The direct market comparison approach is most important in determining the value of a(n) A. existing residence B. New residence C. apartment building D. store building ***Most residential property (with exception of new construction) is evaluated with the market data approach***

The extent of a property manager's authority is found in the A. licensing laws. B. local zoning laws. C. association by-laws. D. management agreement.

The reason for requiring an earnest money deposit in a purchase contract is to: A. ensure that the seller will not have offers from buyers who are unable to qualify for a loan B. provide proof of the buyer's intent to carry out the contract C. ensure that the broker will receive some commission if either the buyer or seller defaults D. set aside funds to cover the buyer's closing costs and mortgage insurance premiums

The following are samples of advertisements placed by a broker on some of his listings. Which would be subject to the provisions of the Truth In Lending Law? 2 bedrooms, large lot, nothing down 3 bedrooms, den, $80,000, E-Z terms 3 bedrooms, 1 bath, $75,000 excellent VA/FHA financing 4 bedrooms, family room, owner will carry financing

The formula for determining the value of income property is: A. Value equals cap rate divided by income B. Value equals net income divided by cap rate C. Value equals income multiplied by cap rate D. Value equals income divided by gross rent multiplier

The highest and best use is the use that: A. contributes to the best interest of the community B. complies with zoning and deed restrictions C. produces the highest gross income D. produces the greatest property value

The income approach to appraising is most important in determining the value of: A. Vacant residential lot B. Single-family home C. Condominium D. Office building

The main purpose of zoning laws is to: A. Determine lot setbacks B. Control county and city ordinances C. Regulate the use and control of private property D. Observe the flow of traffic

The maximum time allowed for the sale of a residential property, through the Public Trustee's office after filing of the notice of election and demand (NED) to foreclose is: A. 45 days B. 90 days C. 125 days D. 230 days

The new owner of a house needs fire insurance coverage for $ 98,000. The annual premium rate is $0.22 per $ 100 for the amount insured. The insurance company agreed to make the cost of the policy 2 1/2 times the annual rate if he purchased a three-year policy. How much would the insurance portion of his monthly PITI payments be to pay for the policy? A. 8.23 B. 14.97 C. 6.58 D. 5.64

The new owner of a house needs hazard coverage for $98,000. The annual premium is $0.44 per $100.00 of the amount insured. The insurance company agreed to make the cost of the policy 2 ½ times the annual rate for a 3 year policy. How much would the monthly insurance payments be to pay for this policy? A. 16.46 B. 29.94 C. 13.16 D. 11.28 ***$98,000 / 100 = 980 X $.44 = $431.20 X 2.5 =$1,078 / 36 = $29.94***

The owner of subsurface mineral rights: A. must pay royalties to surface owner B. has no rights to enter and use surface of property C. may have the right to enter and use property D. must go to court to gain access to the rights

The parties to the Exclusive-Right-to-Buy Contract are: A. broker, seller B. seller, buyer C. buyer, broker D. listing broker, selling broker

The physical characteristic of real property that no two parcels of land are exactly alike is called A. indestructibility. B. nonhomogeneity. C. immobility. D. income approach.

The potential gross income of a warehouse is $4,200 a month and the vacancy rate is 2 1/2%. The taxes are $3750, the monthly maintenance costs are $350, monthly reserves for replacement are $250, depreciation is $575 a month, management fees are $500 per month, debt service is $1200 per month and the quarterly landscaping fees are $600. If the cap rate is 12.5% what is the estimated value of the warehouse? A. 238320 B. 383120 C. 183120 D. 288320

The replacement cost method of appraising real property: A. tends to set the upper limits of value B. would be the method used in appraising special purpose properties C. is appropriate for newly built improvements where the construction represents the highest and best use. D. all of the above are true

The rescission provisions of truth-in-lending apply to what type of loan? A. purchase money B. construction C. business D. home equity

The primary survey line running east and west in the rectangular survey system is a: A. township line B. base line C. range line D. principal meridian

The purchase agreement says to release earnest money after the inspection date. The seller demands the money be released prior to the inspection date. What should the listing broker do? A. tell the buyer of the situation B. refuse to release the earnest money C. release the earnest money

The purchaser of a real property would be most concerned with: A. Effective age B. Future economic life C. Chronological age D. Actual age

The quarterly interest is $562.50 and the rate is 7.5% What is the principal amount of the loan? A. 27000 B. 35000 C. 42000 D. 30000 $562.50 and multiply by 4 = $2,250 or the annual interest. Now divide this by 7.5 % = $30,000

The rate of return an investor wants on an investment in the property is often called:. A. Rate of Investment B. Capitalization Rate C. Yield D. Reasonable Return Rate

The real estate contract for a specific property for use as an unlicensed petroleum sales operation was forced to terminate. The termination was the result of: A. impossibility of performance B. novation C. breach of contract D. operation of law

The water bill has been paid in advance by the seller for the month of August. The bill was $35.82. The closing is August 25. The correct entry on the settlement statement would be: A. Credit Seller $35.82, Debit Buyer $35.82 B. Credit Buyer $9.50, Debit Seller $9.50 C. Credit Seller $8.09, Debit Buyer $8.09 D. Credit Seller $8.09, Debit Buyer $27.73, Credit Broker $27.73

The sales price of a property appears on a closing statement as a: A. Credit to the buyer B. Credit to the seller C. Credit to the broker D. Debit to the broker

The seller holds legal title to real property after the sale under a: A. trust deed B. mortgage (lien theory) C. land contract D. bill of sale

The seller of the property is including the refrigerator and window coverings with the sale. Where in the offer to purchase is this addressed? A. Since these items are in the multiple listing, there is no need to mention them B. In the inclusions section of the contract C. In the other provisions section of the contract D. Since these items are personal property, they cannot be mentioned in the contract to purchase the real property

The seller's property disclosure indicates the condition of all but which of the following? A. The appliances B. The title C. The heating and cooling system D. The electrical system

The sellers have agreed to give the buyers an allowance to recarpet the living room. They will allow $22.95 per square yard for carpet plus $6.00 per square yard for pad and installation. If the living room is 21 feet x 12 feet, how much will it cost the sellers? A. $642.60 B. $810.60 C. $1,927.80 D. None of the above **21 feet x 12 feet = 252 square feet. 252 square feet divided by 9 = 28 square yards. The carpet is $22.95 x 28 = $642.60. The pad and instalation is $6.00 x 28 = $168. $642.60 + $168 = $810.50 total cost.

The succession of conveyances whereby the present owner of record derives title is called the: A. chain of title B. certificate of title C. title insurance D. Torrens certificate

The term fiduciary refers to the: A. sale of real property B. person who gives someone else the legal power to act on his or her behalf C. person who has legal power to act on behalf of another

The value of all vacant land is influenced by its best potential use. One of the leading factors or influences in the valuation of urban industrial land is: A. front footage B. size of acreage C. corner influence D. unearned increment

Title insurance companies guarantee against a loss because of defects existing: A. at the time of acceptance of contract B. at or before the date of the policy C. at the time of closing D. subsequent to the date of issuance of the title policy

Title insurance endorsements appear on a closing statement as a: A. Credit to the seller B. Debit to the seller C. Debit to the broker D. Credit to the broker ***Broker is "collecting the money so he can cut a check for the title insurance***

To arrive at the valuation of an amenity type property, an appraiser would use: A. Sales Cost Approach B. Income Approach C. Principle of Substitution D. Reproduction Cost Approach

To be effective a lease must be: A. delivered B. recorded C. sealed D. defeated

To be the broker of record for a corporation: A. The person must hold a position as a director of the corporation B. The person must have a valid Colorado Broker's license C. Be an executive of the corporation such as president, vice president, CEO, etc D. Have some ownership in the corporation.

To be valid, a deed must have all but: A. A granting clause B. A description of the property C. The signature of the grantor D. Valuable consideration

To net the owner $90,000 after a 6% commission is paid; the list price would have to be: A. 95400 B. 95745 C. 95906 D. 96000 $90,000 / 94% = $95,745; $95,745 x 6% = $5,745

To pre-qualify a buyer, a broker should obtain the following information from the buyer: A. buyer's criminal background B. buyer's marital status C. buyer's drivers license number D. buyer's present occupation information (i.e. gross income, how long at present job)

To terminate an estate for years leasehold estate, how much notice must be given? A. 60 days B. 30 days C. 90 days D. None of the above

Trade Fixtures are: A. permanent part of a building B. owned by the owner of the real estate C. Removable with the owner's permission D. personal property of the tenant

Traditional splits offered in a real estate office might include: A. start at 50/50% B. are always 70/30% C. never exceed 80/20% D. are negotiable

Trust Account journal and ledger documentation of disbursements from trust accounts need NOT include: A. Records verifying purpose of payment B. Amount paid and the resulting balance C. Date of payment and check number D. Name of the person who wrote the check out of the account **The person who wrote the check doesn't necessarily have to be the person who is buying the property--could be their mom, brother, etc....

Truth in Lending laws are primarily for the regulation of: A. Seconds and equity loans B. Conventional loans C. RESPA compliance D. First mortgages **Note: TILA has NOTHING to do with RESPA!!**

Typical functions of a property manager include all of the following except A. maintaining quality service with the lowest possible expenses. B. generating the highest return for the owner. selling the property at the highest price for the owner. C. keeping the property in good repair. ***A property manager does not sell the property.***

Under "vicarious liability" in Colorado: A. The principal is liable only for acts of the agents that the principal has approved, directed or ratified B. The principal is liable for any acts performed by their agent as long as the acts are within the scope of the agency C. The licensee is solely responsible for his/her own actions D. The licensee is liable for the acts of the seller that the licensee has approved, directed or ratified ***Remember that it's anything that is approved, directed or ratified***

Under Commission Rule F, which of the following is correct? A. It is acceptable to alter an exclusive right to sell listing contract in order to create an open listing contract or an exclusive agency contract B. It is acceptable to strike extraneous material in the printed approved contract C. It is acceptable to write a contract for your client D. It is acceptable to delete any part of the contract

Under the 1988 amendment to the Civil Rights Act of 1968, an apartment owner would be acting within the law by A. refusing to pay for modifications to an apartment that would allow a handicapped person the full enjoyment of the unit B. asking whether a renter has a handicap and attempting to determine its severity C. refusing to make reasonable accommodations in rules, policies, practices, or services to allow a handicapped person equal opportunity to use a dwelling D. refusing to rent to a person whose handicap is mental rather than physical

Under which circumstance is it NOT necessary to use a Colorado Real Estate Commission-approved form? A. When purchasing a home in the resale market through a licensed broker B. When purchasing a newly constructed home C. When purchasing a duplex D. When purchasing a commercial property

Unless expressly reserved, all of the following are included in the conveyance of Real Estate except? A. Surface rights B. Gas and oil rights C. Air rights D. The bill of rights

Use the included Amoritization Chart (also called a mortgage factor chart) to find the shortest term for a $275,000 loan at 6.5% interest that keeps the monthly payment under the $1,800 the borrowers can afford. A. 15 years B.. 30 years $275,000 has 275 $1000's in it. If you multiply 275 x 8.71 (the 15 year term factor) you get a monthly payment of $2395.25. That is too much! The 30 year factor of 6.32 x 275 = $1738 - well below the $1,800 amount the borrowers can afford.

Income Method

Used to calculate income from rents or leases and to calculate its value on the current market (Commercial)

What appraisal approach would be used on a residential duplex for fire insurance purposes? A. Sales Comparison Method B. Income Method C. Cost Approach Method D. Square Footage Method

What if anything must an associate broker include in his/her Web site advertising? A. Name of the brokerage firm that holds the associate broker's license B. Names of all licensees in the broker's office which the associate broker works C. The brokerage firms home office that holds the associate's license D. There is no need for additional disclosures

What is a mandatory recommendation in the Contract to Buy/Sell Real Estate? A. Use of a home inspector B. Use of Legal Counsel C. Use of a surveyer to verify property boundaries D. Use of Legal and Tax Counsel

What is one of the things that MLS can be used for? A. writing real estate contracts B. creating a real estate marketing plan C. developing a broker's annual budgets D. designing brochures and mapping out property locations

What is the appraiser's most important consideration in estimating the value of commercial property? A. The gross rent multiplier B. The gross income C. The net income D. The reproduction cost.

What is the purpose of the real estate commission in Colorado? A. to provide mediation in disputes between brokers and Colorado residents B. to protect Colorado residents in real estate matters C. to assure that licensees collect commissions in accordance with the law D. to provide legal assistance to the public regarding real estate transactions

What legal duties does a seller's agent owe to a buyer who does not have agent representation? A. None at all, the sellers agent represents the seller B. Disclosure of material facts and loyalty C. Honesty and disclosure of anything the broker know about the property and the seller D. Fair and honest dealing and disclosure of material facts about the property

What must appear in the title of a trust account? A. Company name B. Employing broker's name C. Company name and employing broker's name D. Responsible broker's name

What type of map is MOST useful for describing the terrain of a very hilly lot? A. Assessor's map B. Contour map C. Recorded map or plat D. Seismic projection map

What would be the best way to valuate a church or school? A. Cost Method Approach B. Sales Comparison Approach C. Either A or B D. None of the Above

What would most likely cause housing prices to fall? A. the sale of 3 luxury homes in a neighborhood B. a company hiring 250 engineers C. a sharp increase in interest rates D. a reduction in building activity

When a broker presents the Definitions of Working Relationships form to a purchaser: A. this is considered adequate disclosure of agency B. no other agency documents need be executed C. this is not considered complete disclosure of agency D. this form is never necessary or required

When a firm furnishes materials for the construction of a house and the firm is not paid, it may file a(n): A. deficiency judgment B. lis pendens C. mechanic's lien D. estoppel certificate

When a husband and wife take title to a property as tenants in common, they have elected a form of ownership that allows for: A. Title in severalty B. Separate life estates C. The right of survivorship D. Unequal shares of ownership **Joint Tenancy allows for right of suvivorship with equal shares of ownership; Tenants in Common allows for unequal shares of ownership w/ no right of suvivorship

When a license law complaint is made to the Commission against a licensee, the licensee must: A. Pay a fine and give up license B. Appear before the Commission within 30 days C. Submit a written response to the Commission if requested D. Temporarily give up license

Which monetary encumbrances should be listed by the seller when completing the Exclusive-Right-to-Sell Listing Contract? A. all encumbrances known to the seller B. all encumbrances the seller will not pay off C. only encumbrances of public record D. all encumbrances to be assumed by a buyer

When a property located in Colorado is sold, it may be subject to state income tax withholding. Which of the following situations would require state tax to be withheld? A. When the last known address at the time of closing was outside of the state of Colorado B. When the property is the principal residence of the seller C. When the sales price is less than $100,000 D. When the seller is a bank foreclosing on a loan which is in default

When a seller wishes to counter an offer made by a purchaser, which of the following documents should be signed by the seller? A. The purchase and sale contract B. The counter offer C. The purchase and sale contract and the counter offer D. The purchase and sale contract after the appropriate changes have been stricken or changed and initialed

When an initial contract for sale of property is different than the contract forms approved by the Colorado Real Estate Commission, the contract should be prepared by: A. broker representing the seller B. a real estate attorney C. broker representing the buyer D. an attorney representing one of the parties to the contract **the attorney has to be one that represents the buyer or seller**

When appraising a commercial property, the appraiser is most concerned with: A. accrued depreciation B. income C. sales prices of comparable properties D. total annual mortgage payments

When appraising property, which of the following would be least important when using the replacement cost approach? A. Current construction cost per square foot B. Rental cost per square foot C. Depreciated expense D. Estimated land value

When borrowing for the purchase of personal property; such as when acquiring a furnished home, The Uniform Commercial Code requires the borrower: A. pledge real property as chattles B. sign a security agreement and file a financing statement C. record the deed D. obtain an abstract of title

When comparing/analyzing CMA, these are the factors that would be NOT be taken into consideration: A. Similar size properties sold in the neighborhood B. Date of sale C. Age of the property D. Accrued Depreciation

When determining what date to use for the inspection resolution date: A. it is wise to advise the buyer that they can waive their right to an inspection, in order to make their offer stronger B. use a date as close as possible to the closing date C. make it as soon as possible D. it must be seven days from acceptance of the contract Ideally, it should be 7-10 days prior to closing

When employing the cost approach to appraisal, the improvements and land are valued: A. Individually by one approach B. Separately C. Jointly by one approach D. Jointly by more than one approach

When improvements reach the age that the income from the property does not pay a reasonable return on the land value, the property has reached the end of its: A. amortization B. highest and best use C. economic life D. lease value

When is an offer to purchase, considered accepted? A. The minute the seller signs the offer B. When the buyer's broker is notified, that the offer has been accepted by the seller C. The law is clear - a purchase contract is accepted only when the buyer's agent receives a signed copy of the offer from the seller, or the seller's agent. D. When the buyer receives copies of the contract from his/her broker

When one has permission to use land but has no other rights, one has a: A. Tenancy in common B. Periodic estate C. Tenancy at sufferance D. Estate in remainder

When purchasing a "new home" through a builder, the earnest money should be held in the: A. broker's escrow account B. builders escrow account C. Title Company's escrow account D. lenders escrow account

When someone has living heirs but dies without leaving a will (called intestate), the estate is distributed according to the: A. marital property law B. devisees C. power of escheat D. law of descent and distribution

When starting out as a new broker, you may want to consider which of the following when choosing a broker to work under? A. Finding the broker with the lowest office fee B. A broker that will provide training and support C. A broker that doesn't require your attendance at sales meetings D. A broker that conducts most transactions in Colorado

When the license of the sole proprietor is suspended for two years, what is the effect on the affiliated associate brokers? A. Affiliates' licenses will also be suspended for a two-year period. B. Affiliates' licenses will be revoked, subject to reinstatement after one year. C. Suspension of the proprietor has no effect on the affiliates' licenses. D. Affiliates licenses are inactive until they are hired by a new employing broker.

When using the market data approach to appraisal, comparable properties should: A. be in the close proximity to one another B. have sold for top dollar C. not be adjusted D. have sold within the last two years

Which does NOT fall under Rule F? A. Contract to Buy/Sell (Commercial) B. Contract to Buy/Sell (Land) C. Deed of Trust D. Contract to purchase newly constructed home with warranties.

Which does the buyer have to disclose to the seller when using the Licensee Buyout Addendum? A. That the Buyer stands to make a profit B. That the Buyer is exposed to possible losses and expenses C. That the property may be immediately sold by the Buyer D. All of the above are required disclosures

Which method of appraisal would a licensee use to appraise a restaurant? A. Market Value Method B. Cost Approach C. Income Method D. None of the Above

Which of the following clauses in a conventional mortgage instrument entitles the lender to accelerate the loan if the loan is assumed? A. Prepayment B. Due-on-sale C. Right to sell D. Defeasance

Which of the following clauses will put the priority of an existing mortgage or deed of trust below that of a mortgage recorded later? A. An exculpatory clause B. A subordination clause C. An assumption clause D. A prepayment clause

Which of the following is (are) considered personal property? A. Wood-burning fireplaces B. Patio furniture C. Bathtub D. Awning

Which of the following is (are) correct concerning the parties of a trust deed? A. The trustee has naked title B. The lender is named the beneficiary C. The trustor has legal title D. All of the above

Which of the following is NOT a fixture: A. Shrub B. Tree C. Swimming Pool D. Land

Which of the following is required to have a real estate license? A. Resident manager of an apartment building B. Property manager specializing in handling buildings in commercial districts C. Any person acting on another's behalf D. A salesperson working in a builder's office

Which of the following is the largest area? A. 10% of a township B. Three sections C. Two miles squared D. 5,280 feet by 5,280 feet

Which of the following is true if a Contract to Buy and Sell form indicates the "Liquidated Damages" choice in case the buyer is in default? A. Seller may keep earnest money and also sue for actual damages resulting from the buyer's default. B. Buyer may cure the default by offering money. C. Earnest money and any other payments or things of value received from the buyer will be kept by the seller as seller's sole remedy for buyer's default. D. Seller may be able to sue to force the buyer to perform under the contract.

Which of the following is true if a broker negotiates a Success Fee under the Exclusive-Right-to-Buy Contract? A. The listing broker must pay the negotiated fee at closing. B. The buyer will pay the fee at closing. C. The buyer will indicate who is to pay the fee D. The seller always pays the fee

Which of the following is true when an employing broker changes the primary business address? A. the broker must notify the commission in a manner acceptable to the commission or the license will become inactive B. each employed licensee must notify the commission of the change C. the change may be noted at the next license renewal cycle D. all licenses of employees must be sent to the commission for reissue

Which of the following lenders uses its own funds to fund loans that will be sold in the secondary mortgage market? A. mortgage broker B. VA C. Fannie Mae D. mortgage banker Explanation Mortgage banker originates loans the other three supply funds to the primary lending market

Which of the following may be subject to regulation under state or federal securities laws? A. Resort condominium project in which owners enter their units in a common rental pool to enhance their income B. Sale of 1000 mountain sites primarily through Internet advertising C. Condominium project that includes both residential and retail uses within one structure D. Speculative purchase of raw land by a doctor as part of a retirement plan

Which of the following represents economic obsolescence? A. A rusted boiler B. A leaking roof C. Depreciation over a period of time D. Loss of value due to nearby adverse zoning change

Which of the following requires the use of the Licensee Buyout Addendum to the Contract to Buy & Sell? A. A listing associates offer to purchase a listing immediately after it expires B. A broker is not offering a guarantee as an inducement to list with his company C. An associate in the brokerage wishes to purchase another associates listing D. A broker offers to purchase a property as an inducement for the Owners's purchase of another

Which of the following requires the use of the Licensee Buyout Addendum to the contract to Buy & Sell? A. A listing associates offer to purchase a listing immediately after it expires B. A broker is not offering a guarantee as an inducement to list with his company C. An associate in the brokerage wishes to purchase another associates listing D. A broker offers to purchase a property as an inducement for the Owner to purchase another

Which of the following rules would a court consider in resolving a contractual ambiguity? A. A contract should be interpreted in favor of the party drafting the instrument B. A later document takes precedence over an earlier document C. Numerals take precedence over written words D. A printed clause would take precedence over a handwritten portion of an agreement

Which of the following statements about the income approach to value is correct. A. It produces the highest estimate of value possible. B. It is the most accurate method of appraising single-family houses. C. It determines an investment property's value based on its return D. It is used more frequently than the direct sales comparison (market value) approach to set loan-to-value ratios.

Which of the following statements is not correct? A. A mortgage's priority is determined by the date on which it was executed B. A mortgage instrument pledges the real estate as security for the loan C. A deed of trust, is usually conveyed by the trustor to the trustee D. In Colorado a deed of trust and a promissory note are executed at the same time

Which of the following steps performs the unit-in-place method? A. Finding the quantity and quality of all material and labor estimated on a unit cost basis B. Finding the cost of installing the plumbing, roof, structure and foundations, (per unit of measure), to estimate value C. Finding the cost of comparable units in the neighborhood D. All of the above

Which of the following would be classified as external obsolescence in the appraisal of real property? A. Termite damage B. Poor architectural design of appraised property C. Normal wear and tear D. Adverse legislative regulations affecting the property **Remember--External Obsolenscence is INCURABLE--in other words, it isn't fixable***

Which of the following would be the most expensive method of appraisal of large, income-producing properties? A. Market data approach B. Comparative approach C. Replacement cost approach D. Capitalization approach

Which of these statements is true with respect to the appraisal of a one family home? A. Capitalization of net income is the most accurate B. You should appraise it by at least three methods, total the results and divide by three C. The reproduction cost method is valid on new property D. Capitalizing the average rent of the neighborhood properties is accurate

Which rule-of-thumb is being used to an investor who is told that a house renting for $900 a month should sell for about $90,000? A. NOI B. IRV C. GRM D. CMA

Which statement is false about unlicensed assistants? A. An unlicensed assistant may be paid a commission by a licensee, based on the success of the transaction B. The broker may allow the assistant to chauffeur and show a listed property with the seller's permission C. An assistant does not need a license D. Unlicensed assistants may prepare a market analysis on behalf of the broker

Which statements are true about VA guaranteed loans? A. The seller cannot pay all the closings costs, the funding fee or pay off any of the veteran's debts B. The borrower cannot pay discount points C. There is a maximum loan amount VA will lend D. None of the above

Who are the parties within an Exclusive Right to Buy Contract? A. Broker and Buyer B. Listing Agent and Buyer C. Listing Agent and Seller D. Depends on which box is checked

Who are the parties within an Exclusive Right to Sell Contract? A. Listing Agent and Buyer B. Broker and Buyer C. Listing Agent and Seller D. Depends on which box is checked

Who can not prepare an addendum to the Contract to Buy and Sell Real Estate? A. buyer or seller B. employing broker's attorney C. attorney for buyer D. buyer''s broker

Who is responsible for proofreading the settlement statement before closing? A. Lender B. Seller C. Broker D. Closer

Who will not have a copy of the listing agreement? A. Seller B. Listing broker C. Buyer's agent D. Listing agent ***Listing agreement is between seller and listing broker only.***

With regard to Colorado real estate licensees: A. If an associate broker uses her home as her office, her license should be in her home. B. An associate broker's license should be in his/her broker's office. C. It must be in the county in which they live D. Cannot sell property unless they have a county real estate license

You are the listing agent and find a buyer for the home that you have listed. The buyer asks you and the seller if there are any major problems with the house. The sellers answers no to the question. One month after the buyer moves in a pipe bursts and floods the basement. The buyer wants to return the home to the seller claiming the seller knew about this issue and said nothing. What is your responsibility? You get to keep your commission The seller could be sued for specific performance You get to return your commission The agent and seller are liable for damages.

You pass your real estate exams. You are not ready to work yet. How long do you have to apply for your license before forfeiting all rights to your passing score? A. 6 months B. 1 year C. Indefinitely D. 4 weeks

You submit an offer to the seller. They agree with price, inclusions, everything except the closing date. The proper way to handle this is: A. prepare another offer with a different closing date B. the seller should sign a counterproposal with their preferred date of closing C. an amend/extend form can be used in the case of date changes only D. the seller should reject the offer

You're holding an open house for another agent. A prospective buyer comes in and asks a bunch of questions. You can't answer some of the questions but tell her you will get back to her. What is your relationship with this individual? Express Agent General Agent Buyer's Agent No agency was created

Your best friend sold her house herself. She asks you to help prepare the documents as a favor, and your response is: A. sure, as long as you use Real Estate Commission-approved forms B. yes, but you will have to execute a listing agreement first C. no, this is illegal D. no, even though legally you could, ethically you cannot work for free ***Must establish an agency agreement by completing a listing agreement, even if it is a really good friend. Otherwise that is called practicing law without a degree--ILLEGAL***

Your buyer is purchasing a town home. He has heard that the community has very restrictive covenants and wants to make sure that his offer is contingent upon his approval of their rules. A. he must check this out ahead of time, since the contract makes no provision for this as a reason for termination B. you must advise him that this is discrimination, and you cannot help him further C. you must write any such contingency in the other provisions section of the contract D. if properly prepared, the buy and sell contract gives him the right to review the covenants and terminate, if they are unacceptable.

Your client is: A. the same as your customer B. the seller C. the buyer D. the party who signs an agency contract with you

Your neighbors use your driveway to reach their garage on their property. Your attorney explains that ownership of the neighbors' real estate includes an easement appurtenant giving them the driveway right. Your property is the: A. dominant tenement B. tenement C. leasehold D. servient tenement

Your offer to buy a property for $150,000 is accepted, but unfortunately there is a fire in the kitchen prior to closing. The insurance company estimates about $9,000 to repair and repaint. The repairs will be made in time to meet the closing date. A. the buyer has the option of terminating B. the buyer must proceed C. the contract automatically terminates D. the buyer and seller renegotiate the price of the property ***The repairs are within the 10% rule; contract must proceed***

Voidable Contract

contract allows one party to avoid contractual duties, such as when one party is a minor or a party is mentally incompetent. Example: 17 year old signs a contract Letting someone who was drunk sign a contract Someone who is mentally unstable signs a contract

Void Contract

contract does not meet all of the required elements of a valid contract and has no legal effect. Example: Casinos in states where it is illegal, contract between drug dealers and buyers

itle passes from the grantor to the grantee: A. at the time of recording of the deed B. at time of the buyer's initial possession of the property C. at time the closing begins D. when the seller signs the warranty deed

Enforceable contract

legally binding contract that the law will recognize.

Unenforceable contract

means a contract would not stand up in a court of law because it does not meet the requirements of the statute of frauds or it runs beyond the statute of limitations. Example: someone threatened the buyer to sign the contract

Principle of Change

property values that change due to outside circumstances like economical, political and social forces.

What does a need need to be valid?

signed by grantor (only)

Cost Approach

states that a property's value can't be greater than the cost of acquiring (buying or building) a substitute property of equal utility.

Principle of Substitution

the value of a piece of property is limited by the cost of obtaining an equally desirable substitute. Example: if two available properties are equally desirable, the one that costs less will be purchased first.

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