VA Real Estate

A loan origination fee is:

A fee charged by the lender to initiate a loan

A condensed history or summary of the documents affecting a property is:

Abstract of title

A defeasance clause in a mortgage will take effect when the:

Borrower repays the entire debt.

An estate at will is: Select one: a. A form of co-ownership. b. An inheritance of property by will. c. A tenancy of uncertain duration. d. A life estate.

C

The Fair Housing laws do Act does NOT provide protection on the basis of: Select one: a. Gender b. Handicapped c. Homosexuality d. Single parenthood

C

The best approach for appraising a 20-year old residence is:

Comparable sales

RESPA prohibits all the following EXCEPT? Select one: a. Kickbacks and rebates. b. Requiring that title insurance be purchased by a certain insurer. c. Allowing a lender to collect as many months' taxes as it wants to for a tax escrow account. d. Allowing the settlement agent to charge a fee for conducting the closing.

D RESPA does not prohibit closing agents from charging a fee.

A couple buys a furnished home by assuming the existing loan. Which of the following papers would the settlement attorney NOT have to prepare?

Note and mortgage. The settlement agent will prepare a new deed and the assumption papers. The personal property in the home will be conveyed using a bill of sale. The buyers agree to make the payments on the existing loan which allows the existing note and mortgage to remain in effect.

The buyer in a purchase agreement is known as a/an:

Vendee

A "For Sale By Owner" placed an advertisement on their property which read, "couples only - no children, please." This advertisement is:

illegal because of Fair Housing Laws regarding familial status

A salesperson took a listing on a property which had a crack in the foundation caused by water seepage. The owner had filled and painted over the crack and advised the sales agent that the seepage problem had been corrected, but it was obvious to the agent that the problem had not been corrected. If the salesperson shows the property without advising potential buyers of the problem, the salesperson would be guilty of: Select one: a. Fraud b. Misrepresentation c. Puffery d. Nothing

A

The accumulation of soil on an owner's property caused by the movement of water is known as: Select one: a. Accretion. b. Riparian. c. Assemblage. d. Annexation.

A

Which of the following would be a violation of anti-trust law? Select one: a. Two brokers agree that each will market his services only in specific areas of the community b. Jim, a broker, advertises that his firm will only represent buyers c. An independent broker refuses to join the local Association of Realtors d. A real estate company has some sales agents working as independent contractors and other sales agents working as employees.

A

When determining effective gross income, an appraiser subtracts which of the following from gross income? Select one: a. Vacancy rates and bad debts. b. Management costs. c. Maintenance, utilities and taxes. d. All of these choices.

A Potential gross income less vacancy losses (including bad debts) results in the effective gross income.

The intent behind the Statute of Frauds is to:

put real estate transactions in writing

How many acres in a one-half square mile parcel of land?

320 1/2 sq. mile means the AREA of the parcel is 1/2 sq. mile. 1 sq. mile = 640 acres. 1/2 sq. mi = 320 acres (640 acres / 2).

A broker and salesperson owe all EXCEPT which of the following to the purchaser/customer? Select one: a. Negotiation of the lowest possible price. b. Honesty. c. Fairness. d. Disclosure of defects in the property.

A

A broker when showing property, should disclose to the buyer any known latent defects about the property. Which of the following is NOT considered a latent defect? Select one: a. Crumbling concrete in the driveway. b. A defective septic system. c. A foundation crack covered with paneling. d. An inoperable garbage disposal.

A

A salesperson is charged with a violation of the license law. Which of the following is true? Select one: a. The licensee is entitled to a hearing, before the Real Estate Board can take disciplinary action, unless the law provides otherwise. b. The licensee has the right to present witnesses in his defense, provided the witnesses are licensed real estate professionals. c. The salesperson's license will be temporarily suspended, until the Real Estate Board can hold a hearing. d. The salesperson's broker will lose his or her license, if the salesperson is found guilty.

A

According to the Truth-In-Lending Law, certain words used in advertisements "trigger" full disclosure of ALL the terms of financing. Which of the following statements would NOT require any additional disclosure? Select one: a. Liberal terms available. b. Down payment - $1,000. c. Only 9 1/2 % interest. d. Payments of only $1,200 per month.

A

Hardwick defaults on his mortgage loan which has a remaining balance of $94,500. The foreclosure sale brings $97,250 after expenses. What will happen to the extra $2,750? Select one: a. It will go to Hardwick. b. It will go to the lender as punitive damages. c. The $2,750 will be applied to the new purchasers closing costs. d. The money is used to pay the cost of the court appointed trustee that handled the sale.

A

When a broker accepts a listing he or she has created an agency relationship. Which of the following is not an agency responsibility? Select one: a. To obey all the instructions of the seller. b. To use care in filling out contract forms. c. To be accountable for documents and funds. d. To be loyal to the seller.

A

Which of the following advertisements is a violation of federal law? Select one: a. "luxury condominium - singles only" b. "honeymoon cottage in a secluded wooded area" c. "payments less than rent" d. "retirement community with a scenic view"

A

Barry makes an offer to purchase a home being sold by Pam. Pam does not accept Barry's offer, but makes a counteroffer. Relative to the counteroffer, which of the following statements is INCORRECT? Select one: a. It is partial acceptance of the original offer b. Barry is now considered to be the offeree c. The counteroffer rejects Barry's offer completely d. Pam may withdraw the counteroffer at any time, prior to acceptance by Barry

A An offer is either accepted or rejected in it's entirety. There is no such thing as partial acceptance. The counteroffer constitutes a NEW offer, so Barry is the offeree in this counteroffer. As with any offer, it may be withdrawn at any time prior to acceptance.

Which of the following statements regarding federally insured or guaranteed loans is true? Select one: a. A Federal Housing Administration (FHA) loan may be made only to a borrower whose intent is to occupy the property. b. A Veterans Administration (VA) loan may be made to a qualified veteran whose intent is to rent the property for which the loan is obtained. c. A Veterans Administration (VA) loan can only be obtained by a veteran that is at least 21 years old. d. Both FHA or VA allow the borrower to obtain a 2nd deed of trust in order to raise the down payment.

A FHA insured and VA guaranteed loans are only allowed for owner occupied properties. There is no specified minimum age for a VA loan. Neither VA or FHA allow junior loans to raise the down payment.

When a buyer wishes to finance a home purchased with an FHA insured loan, which of the following assurances does FHA provide? Select one: a. The property passed FHA inspection. b. The property cannot be condemned in the future. c. The area is not segregated. d. All of the above.

A FHA only insures loans made to qualified borrowers after FHA or assigned appraisers have inspected the property. No assurances can be made about condemnation (a government action) or lack of segregation in the area.

Julia, a licensed salesperson, obtains a listing. Several days later, Julia meets prospective buyers at the property and remarks to them that she is the listing agent and therefore very familiar with the property. Under the circumstances described, Julie: Select one: a. Has failed to properly disclose her agency relationship. b. Has disclosed her agency relationship with the seller. c. Is in violation of Board regulations because she cannot sell her own listing. d. Has created a dual agency, which is a violation of Board regulations.

A Julia has not properly disclosed her agency relationship because she did not do so in writing.

A new property was valued at $179,000 with an estimated life of 50 years. The value of the land has been estimated at $19,000. After allowing for depreciation, what is the value of the property at the end of 5 years? Select one: a. $163,000. b. $161,000. c. $160,000. d. $144,000.

A Remember you depreciate the value of improvements ONLY. Value of the property = $179,000 less $19,000 (land) or $160,000 for the value of the improvements which is depreciated 2% each year 100% / 50 years estimated life = 2% each year. 5 years at 2% is 10% or $16,000. $160,000 less $16,000 depreciation = $144,000 (improvements). $144,000 + $19,000 (land value) = $163,000 total value.

After a fair housing complaint is received by the Real Estate Board, the Board must determine within 100 days: Select one: a. If there is reasonable cause to believe discrimination exists or if the case should be dismissed. b. The penalty to be imposed for violation of the law. c. The final resolution of the case. d. If the case should be referred to binding arbitration.

A The Real Estate Board must determine whether there is reasonable cause to believe that discrimination occurred or dismiss the case within 100 days from receiving the complaint. Final resolution of the case, penalty to be imposed, or referral for arbitration would occur according to normal due process.

A seller is willing to pay a broker a 6% commission if the broker can sell his house for enough money to pay off the existing loan of $75,300 and allow the seller to clear $10,000 cash on the deal. How much will the property sell for (to the nearest dollar)? Select one: a. $90,745. b. $90,418. c. $85,300. d. $80,106.

A The amount needed to pay off the old loan = $75,300. The amount needed to give the seller his cash = $10,000. Total needed before computing commission = $85,300. $85,300 is 94% (100%-6%) of the selling price. We know that SOMETHING x 94% = $85,300. Therefore $85,300 divided by 94% = $90,744.68 or $90,745.

When would the defeasance clause in a mortgage take effect? Select one: a. When the entire debt is repaid b. When the borrower misses one payment c. When the borrower sells the property for less than the amount of the existing loan d. When the property is destroyed by natural causes

A The defeasance clause will take effect when the promissory note has been paid in full, thus defeating the mortgage. The acceleration clause allows a lender to call the entire loan balance if the buyer defaults. Alienation clause (due on sale) allows the lender to do the same thing if the buyer conveys (alienates) the property.

A Virginia lender refuses to make a loan to purchase real property on the basis that the applicant was over 60 years old and would not live long enough to repay the loan. In this situation, the lender is: Select one: a. In violation of Federal Fair Housing Laws. b. In violation of Virginia Fair Housing Laws. c. Practicing good fiscal management. d. In compliance with Federal and Virginia banking laws.

B

A buyer's agent was showing a buyer a property that was listed for sale. No dual agency existed on this transaction. The seller would be considered a: Select one: a. client of the buyer's agent b. customer of the buyer's agent c. principal of the buyer's agent d. prospect of the buyer's agent

B

A deed may be recorded once it is signed by the grantor and: Select one: a. Signed by the grantee b. Acknowledged c. The seller has vacated the property d. All of the above are required

B

A general agency empowers the agent to: Select one: a. Transact matters of all types for the client. b. Transact the clien'ts affairs in a certain business. c. Perform only specific acts for the client. d. Perform any legal act for the client.

B

A mechanic's lien against the property could be filed by: Select one: a. Dominion Roofing that completed installation of a new roof four months ago. b. Aqua Pool Installation and Maintenance Co. that installed a swimming pool and deck 88 days ago. c. Keynes Lumber Co. that provided all materials for 12' x 20' deck six months ago. d. JB Electrical Supply that rewired the entire house to bring it up to code requirements three months and five days ago.

B

An individual associate broker who has been assigned to supervise the activities of a branch office is called a(n): Select one: a. Associate broker. b. Supervising broker. c. Principal broker. d. Broker.

B

Fred bought a new boat. He hired a contractor to build a dock on his lake-front property. Fred did not pay the contractor. In an attempt to get paid, the contractor may file a: Select one: a. Mechanic's lien against the boat. b. Mechanic's lien against the property. c. General warranty lien against the boat. d. Littoral rights lien against the property.

B

If a broker has repaid the Real Estate Board for amounts awarded from the Transaction Recovery Fund, which of the following is true? Select one: a. His or her license is automatically reinstated. b. The Real Estate Board could withhold issuance of a new license, forever. c. He or she may apply for a new license within 30 days. d. He or she will be reinstated at the level of salesperson, NOT as a broker, for a period of 2 years.

B

Monetary claims (per licensee) to the transaction recovery fund for a single transaction are limited to: Select one: a. $25,000 to any one claimant, with a maximum of $100,000 to all claimants. b. $20,000 to any one claimant, with a maximum of $100,000 to all claimants. c. $50,000 to any one claimant, with a maximum of $100,000 to all claimants. d. $50,000 to any one claimant, with a maximum of $500,000 to all claimants.

B

The Civil Rights Act of 1866: Select one: a. Is considered to be a part of the 14th Amendment to the U.S. Constitution. b. Was the underlying basis for the decision in Jones vs. Mayer. c. Declared it unlawful to discriminate in all matters, not just housing, on the basis of the race of an individual. d. All of these choices.

B

Two brokers from different firms agree that they will charge the same commission rate for all property listed by their offices. Such action: Select one: a. Is common practice. b. Is in violation of anti-trust laws. c. Is prohibited by RESPA. d. Violates the Fair Housing Law.

B

Which of the following statements about options is true? Select one: a. The optionor can void the option if another offer is submitted. b. The optionee can allow the option to expire. c. The optionee can extend the option period automatically. d. Options only involve raw land.

B

If the capitalization rate is 8% and the yearly net income is $100,000, what is the selling price? Select one: a. $800,000 b. $1,250,000 c. $1,800,000 d. $2,000,000

B $100,000 net income divided by a cap rate of 8% equals a value of $1,250,000.

Which of the following would result in the highest tax for a property assessed at $88,000? Select one: a. $3.05 per $100. b. 31.5 mills. c. 0.0305 per $1. d. $31.48 per $1,000.

B $88,000 / 100 * $3.05 = $2,684. 31.5 * .001 * $88,000 = $2,772. .0305 * $88,000 = $2,684. $88,000 / 1,000 * $31.48 = $2,770.

Which of the following is NOT a freehold estate? Select one: a. An interest in land for at least a lifetime. b. A lease which doesn't require rent payments. c. A life estate. d. A fee simple estate.

B A freehold is an interest in land for at least a lifetime. Life estates and fee simple estates are freeholds. All leases, regardless of the terms, are leasehold estates.

Which of the following is the BEST example of a unilateral contract? Select one: a. Lease. b. Option. c. Real estate contract for sale. d. Listing agreement.

B A listing agreement could be either unilateral or bilateral. The best example given here is the option. The seller is obligated to keep the offer open, but the buyer is not required to exercise the option.

Which of the following is NOT essential to the validity of a mortgage? Select one: a. Debtor. b. Attorney. c. Creditor. d. Pledge of property.

B A mortgage is a pledge of property as security for the money borrowed by the mortgagor (debtor) from the mortgagee (creditor). Although usually involved, an attorney is NOT required to create a mortgage.

Under which of the following conditions would a buyer most likely sue for specific performance? Select one: a. If the seller did not inform the buyer that the property being purchased is a servient estate (easement placed upon it). b. If the seller defaulted on the contract before closing c. If the broker lied about the location of the schools d. If the salesperson misquoted the size of the lot

B If the size of the lot, location of the schools or the fact that the property is a servient estate are real issues for the buyer, then he would not sue to have the terms of the contract carried out. If the seller tries to back out of the contract, then the buyer would probably sue.

Although a right of rescission for resale units is not included in the statute, it is common practice that a buyer may rescind the contract to purchase a resale condominium within: Select one: a. Three days of contract ratification or receipt of the condominium documents with sufficient cause. b. Three days of contract ratification or receipt of condominium documents for any reason. c. Ten days of contract ratification or receipt of condominium documents with sufficient cause. d. Ten days of contract ratification or receipt of condominium documents for any reason.

B It is common practice for the purchaser to have the right to rescind the contract if he or she finds the documents unsatisfactory. The purchaser of a condominium unit has three days after receipt of the required documents to either accept or reject them. No specific reason needs to be given.

Z purchases a vacant lot for $28,000 and constructs a house on the lot at a cost of $250,000. Later Z wants to sells the property and make 3% profit on the land and a 30% profit on the house. What is the least amount that Z could sell the property for and realize his desired profit? Select one: a. $278,000. b. $353,840. c. $358,340. d. $369,740.

B Lot cost $28,000 X 3% = $840 profit on lot. House cost $250,000 X 30% = $75,000 profit on house. Total cost of lot and house = $278,000. $840 + $75,000 + $278,000 = $353,840 selling price.

The final step in the appraisal of an apartment building is: Select one: a. Capitalization. b. Reconciliation. c. Recapitalization. d. Summation.

B The final step in ANY appraisal report is the reconciliation.

A broker can do which of the following? Select one: a. Accept, as binding, a promissory note given as an earnest money deposit. b. Accept, on behalf of the seller, an offer OVER the listed price of the property. c. Buy and sell property in his own name. d. Represent both buyer and seller with the permission of the buyer.

C

A broker can do which of the following? Select one: a. Accept, as binding, a promissory note given as an earnest money deposit. b. Accept, on behalf of the seller, an offer OVER the listed price of the property. c. Buy and sell property in his own name. d. Represent both buyer and seller, with the permission of the buyer.

C

A buyer requests the broker take a listed property off the market until his wife sees the property. Should the broker do this? Select one: a. Yes, as long as his wife can see it before the next business day. b. Yes, if the buyer pays the brokerage firm a small fee for this service. c. No, this would violate the agency agreement. d. No, only the local Association of Realtors can approve such an arrangement.

C

A condominium advertises a pool and tennis court, but they have not yet been completed. Which is correct? Select one: a. This is illegal advertising. b. It is allowed so long as the advertising states "not yet completed." c. This is allowed if they are labeled not yet completed and a completion date is specified. d. This is allowed since the rule of caveat emptor reigns.

C

A house sold for $140,000 with the buyer making a 20% down payment. The grantor's tax is charged at $1.00 per $1,000, what would the tax amount to: Select one: a. $28.00 - based on the down payment. b. $112.00 - based on the loan amount. c. $140.00 - based on the selling price. d. None of the above.

C

Casper is planning to sell his house and desires the broadest possible exposure. He gives Bert an exclusive right-to-sell listing, Gail an exclusive agency listing and Mark an open listing. Mark sells the house. Under these circumstances, which of the following statements is true? Select one: a. Mark must split his commission with Bert and Gail. b. Casper owes two commissions, one to Mark and one to Bert and Gail to be split between them. c. Casper owes 3 commissions. d. Mark is the only one who will receive a commission.

C

Current tenants of a property being converted to a time-share project must be provided with: Select one: a. 30 days' notice of intent to convert, 30 days to contract to purchase unit. b. 30 days' notice of intent to convert, 60 days to contract to purchase unit. c. 90 days' notice of intent to convert, 60 days to contract to purchase unit. d. 90 days' notice of intent to convert, 30 days to contract to purchase unit.

C

If the Transaction Recovery Fund falls below the statutory minimum, licensees may be assessed to restore the Fund. What is the maximum that one licensee may be assessed during a two-year period? Select one: a. $40.00. b. $50.00. c. $20.00. d. There is no maximum assessment.

C

Members of the Real Estate Board are: Select one: a. Selected by the Virginia Association of Realtors. b. Elected by the public. c. Appointed by the governor for a four-year term. d. Elected by state real estate licensees.

C

The main benefit to a buyer working with a designated agent, rather than with a dual agent, is that: Select one: a. Both agents are members of the same firm. b. The broker will assist the designated agent. c. The designated agent will be able to advise and represent the buyer's best interests. d. The broker remains in a dual agency relationship.

C

When Lori passed her license examination she placed her license on inactive status. Two years later she decides to activate her license with a local firm. Lori needs to: a. Sit for the state portion of the license examination. b. Take a 15-hour real estate course that reviews Virginia laws and regulations. c. Complete an activate form and pay a fee. d. Advise the Board of her intent and request her license be sent to her.

C

Which legal instrument is used to convey a tenancy for years from one person to another? Select one: a. Deed. b. Land contract. c. Lease. d. Purchase contract.

C

Which of the following contracts is voidable? Select one: a. One of the parties to the contract is legally insane b. One of the parties did not sign the contract c. One of the parties was drunk at the time the contract was signed d. The subject of the contract was for an illegal purpose

C

Which of the following is NOT specifically protected by fair housing statute? Select one: a. People in a particular religious group. b. People who are physically handicapped. c. Current drug users. d. Persons previously confined to a mental institution.

C

A developer has 4 parcels of land. He plans to construct an office building that will require 2 acres including building, parking and landscaping. Which is the smallest parcel that will accommodate this new construction? Select one: a. Parcel A = 83 ft X 950 ft b. Parcel B =102 ft X 840 ft c. Parcel C = 120 ft X 860 ft d. Parcel D = 140 ft X 900 ft

C First you must calculate the square footage required for the construction. 43,560 sq. ft. per acre X 2 = 87,120 sq. ft. Then calculate the size of each individual parcel by multiplying length X width. Both parcels C and D will accommodate the construction, but the question asks for the smallest parcel.

Who is responsible for obtaining information regarding released sex offenders per the "Megan's Law" disclosure statement in the property disclosure/disclaimer forms? Select one: a. Seller. b. Licensee. c. Buyer. d. Broker.

C The Megan's Law disclosure statement in the property disclosure/disclaimer form makes it very clear that it is the buyer's responsibility to obtain information regarding sex offenders for themselves and provides a source for such information. It is not the responsibility of the seller, licensee, or broker.

A licensee is obligated to do all of the following for a customer EXCEPT: Select one: a. Treat the customer honestly. b. Disclose all material adverse facts about the property. c. Perform ministerial acts that require no judgment by the agent. d. Assist with negotiation of a contract.

C Under no circumstances can the licensee assist with negotiation of the contract for the customer; contract negotiating is a duty to a client. A licensee's obligations to a customer include honesty , disclosure of material adverse facts, and performance of ministerial acts as needed.

A broker may accept as binding, which of the following, without the consent of his client? Select one: a. A promissory note as deposit, when such note was not mentioned in the offer. b. A post-dated check as a deposit, when not mentioned in the sales contract. c. A rebate on an expenditure made for a seller. d. None of these choices.

D

A broker, acting as a dual agent, with the knowledge and consent of all parties, collected one-half the commission from the seller and one-half from the buyer at settlement. Which of the following statements is true concerning this situation? Select one: a. This action is illegal b. The broker needed only the consent of the seller c. The broker needed only the consent of the buyer d. This action is permitted only with the consent of both parties

D

A contract of sale CANNOT exist without an offer and: Select one: a. Assignment b. Mortgage c. Assessment d. Acceptance

D

A nonresident who obtains a license as an active salesperson in Virginia is required to do which of the following? Select one: a. Move to Virginia within six months of licensure. b. Post a bond. c. Maintain an escrow account in Virginia. d. Activate with a Virginia licensed broker.

D

A quitclaim deed may be used to: Select one: a. Transfer ownership of a fee simple estate b. Transfer interest in a life estate c. Terminate an easement d. Any of the above

D

An ad used in marketing a time-share project that includes free gifts or prizes must clearly disclose all of the following EXCEPT the: Select one: a. Retail value of the gift. b. Conditions under which the gift is offered. c. Odds of winning the prize. d. Cost of the advertisement itself.

D

Carol had just started to work as a salesperson. On her first day she obtained an exclusive listing. The listing must include all of the following information, except: Select one: a. The name of her employing broker. b. A definite date on which the listing will expire. c. An adequate property description. d. The net amount that the seller will receive from the sale.

D

If a prospective buyer (who is of a minority group) asks an agent to show her properties, the agent should: Select one: a. Show her properties in areas that are predominantly of the same minority group. b. Refer her to an agent in the firm of the same minority. c. Advise her that the firm does not handle people of her minority group and refer her to another brokerage. d. Show her any property for which she is financially qualified.

D

The Real Estate Board has the authority to do all of the following EXCEPT to: Select one: a. Issue and renew real estate licenses. b. Enforce license law. c. Determine license fees. d. Establish commission rates.

D

When a license of either salesperson or broker is renewed, the licensee MUST: Select one: a. Attest to a prescribed level of competency. b. Submit a credit report. c. Take a new examination. d. Pay the required renewal fee.

D

Which of the following are EXEMPT from the licensing requirement of the Virginia real estate license law? Select one: a. Property lessor. b. Attorney-at-law. c. Receiver in bankruptcy. d. All of the above.

D

Which of the following does NOT need to have a broker's license? Select one: a. A partner in a brokerage partnership who does not participate in the brokerage business of the partnership. b. An attorney-at-law. c. A person acting under the authority of a power of attorney. d. All of these choices.

D

Which of the following factors would have the LEAST effect on an appraisal? Select one: a. The real estate market, in general. b. Income to be derived from the property. c. Location of the property. d. Livelihood of the prospective buyer.

D

Which of the following would need a real estate license? Select one: a. An owner who sells more than three of her own houses in a year. b. A salaried property manager employed by an apartment house owner to manage the apartment house and lease the individual apartments. c. An attorney who is offering real property for sale under court order. d. None of the above.

D

Using "bait and switch" tactics in advertising would be a violation of the standards of conduct regarding: Select one: a. Conflict of interest. b. Improper brokerage commission. c. Unworthiness and incompetence. d. Misrepresentation.

D "Bait and switch" tactics, i.e., advertising something that is not actually available, fall under the misrepresentation category. Conflict of interest, improper brokerage commission, and unworthiness and incompetence are each separate categories covered under the Real Estate Board standards of conduct.

A house sells for $54,000 and is assessed at $39,400. Annual taxes are calculated at $0.92 per $100 and are paid every 6 months. What is the semi-annual tax bill? Select one: a. $496.80 b. $363.40 c. $248.40 d. $181.24

D Assessed value $39,400 X .92 divided by 100 = $362.48 annual taxes. $362.48 divided by 2 = $181.24 each 6 months.

Broker Fowler located a property for buyer Jackson. Jackson paid seller Allan a $1,000 fee for a 30 day option. Which of the following is true? Select one: a. Fowler earned his commission when the option was signed b. Part of Fowler's commission will come from the $1,000 c. Local custom will determine the commission d. Fowler will not earn a commission until Jackson becomes owner of the property

D Fowler does not earn a commission until the property sells.

Asbestos would most likely be found where in a house? Select one: a. Around electrical wires b. In the paint c. Around the fireplace d. Around pipes

D Prior to 1979, asbestos was a common building material and was used in floor tiles, ceiling tiles, roofing material and as insulation around pipes and heat ducts.

It has been determined that a complaint should be investigated. All of the following procedures must take place EXCEPT: Select one: a. An agent of the Department of Professional and Occupational Regulations interviewing the claimant, respondent, and witnesses. b. The agent of the Department of Professional and Occupational Regulations reporting the facts to the Real Estate Board without comment. c. The Real Estate Board reviewing the report and determining whether the case should be dismissed or carried forward for further investigation. d. The Real Estate Board immediately convening to determining the extent of the violation and to impose sanctions.

D The Real Estate Board does not immediately convene to determine the extent of the violation or to impose sanctions. The procedure for handling a complaint against a licensee includes the interviewing of all parties by an agent of the Department of Professional and Occupational Regulations who then reports the facts without comment to the Real Estate Board. The Real Estate Board reviews the report and either dismisses it or finds "probable cause" and carries it forward for a formal hearing.

All of the following are limitations on ownership of property, EXCEPT: Select one: a. Zoning b. Police power c. Building codes d. Seizen

D The government rights in land include taxation, eminent domain, police power and escheat which are limitations on ownership of private property. Zoning and building codes are both examples of police power. Seizen is, by definition, ownership.

A lender advertises 80% LTV conventional loans. 80% is applied to: Select one: a. Appraised value b. Selling price c. The buyers income d. The purchase price or appraised value, whichever is lower

D The loan to value (LTV) ratio is always applied to the appraised value of the property or the selling price, WHICHEVER IS LOWER.

A broker desired to charge a flat fee to all sellers in order to collect the same amount for the work, regardless of the list price of the house. The broker could do this only: Select one: a. if the broker applied to the state legislature for approval b. if there was a history of this in that area c. by showing the seller the flat fee versus a percentage of the list price d. by informing the seller prior to the listing and obtaining agreement

D Whether to charge a flat fee or a percentage fee is a negotiable item between the seller and broker.

Limitations that a person places on the use of property that she or he owns are which of the following?

Deed restrictions

Broker escrow accounts must be:

Designated and labeled as "escrow." A principal broker is not required to have an escrow account; but if there is an escrow account, all earnest money, deposits' must be deposited there within five banking days and the account must be labeled as "escrow".

When will a deed restriction take precedence over a zoning ordinance?

If the deed restriction is more restrictive Regardless of when the zoning ordinance was adopted or the deed restriction recorded, the rule is "...whichever (deed or zoning restriction) is most restrictive, will apply."

The principle of substitution is most centrally used in appraisal:

In the Market Data approach Substitution is the "core" basis of the market data approach to appraisal...also called Sales Comparison approach.-=

When does the Virginia law of agency require that a licensee make a disclosure of the brokerage relationship to any actual or prospective buyer or seller?

Only if the actual or prospective buyer or seller is not represented by another licensee.

Which best describes marketable title?

Reasonably free from the risk of litigation over possible defects.

The Board feels a broker is not properly managing her escrow account. Upon request, the court appoints a receiver to manage the account. After the investigation, it is determined that the broker is innocent of any wrongdoing. Who is responsible for the expenses and fees of the court appointed receiver?

The Board, using money from its operating budget Since the broker was found innocent of any wrongdoing, the Board would have to pay these costs out of its operating budget.

Which of the following controls a cash settlement?

The Equal Credit Opportunity Act. RESPA is the Real Estate Settlement Procedures Act and was enacted to inform buyers and sellers of the costs of closing a real estate transaction. There are certain REQUIREMENTS of RESPA as related to Federally related loans. Although there is no loan in a cash settlement, there are still closing costs for which the buyer and seller must be informed.

A person that has the contractual ability to enter into a contract is considered:

To be mentally competent