Broker Prelicense Course (with notes)

Barbara has sold her home to Sue. They are closing on August 3. Barbara held a homeowner's insurance policy for the home at an annual cost of $1,200. What is Sue's share of the insurance premiums based on the 365-day method of calculation?

$0.00 A homeowner's insurance policy held by Barbara is not an expense to be prorated. Sue will obtain her own policy and pay the premiums on that policy. Therefore, Sue owes nothing on Barbara's policy.

A seller prepaid taxes of $2,100 and the closing is set for March 15. The day of the closing belongs to the seller. Using the 12 month /30-day method, what will the buyer owe the seller as prorated taxes?

$1,662.50 $2,100 / 12 = $175 monthly rate; $175 / 30 = $5.83 daily rate; Sellers' share = $437.45 $175 x 2 months (January and February) = $350; $5.83 x 15 days (March 1 - 15) = $87.45 $350 + $87.45 = $437.45 Buyers' share = $1,662.45 $2,100 - $437.45 = $1,662.45

A seller prepaid taxes of $3,100 and the closing is set for March 15. The day of the closing belongs to the seller. Using the 12 month / 30-day method, what will the buyer owe the seller as prorated taxes?

$2,454.1es7

Under New York's Real Property Law, the credit a seller must give a buyer at closing for failing to provide a timely property condition disclosure is

$500

Barbara has sold her home to Sue. They are closing on August 3. If the real estate taxes for the property are $1,800, what is Sue's share of the taxes based on the 12 month/30 day method of calculation?

$735

A seller prepaid taxes of $2,100 and the closing is set for April 10. The day of the closing belongs to the seller. Using the 12 month / 30-day method, what will the buyer owe the seller as prorated taxes?

1516.66

Which of the following statements is FALSE? A community achieves its land usage goals by developing a master plan A community achieves its land usage goals by having a municipal, county, or regional planning board A community achieves its land usage goals by not allowing property owner input while developing the comprehensive land use plan A community achieves its land usage goals by implementing the master plan through zoning, building codes, and permits

A community achieves its land usage goals by not allowing property owner input while developing the comprehensive land use plan

In addition to chain of title, what is contained in an abstract of title?

A list of all current recorded claims against the title

When a one- or two-family property is sold in New York, what is required?

A smoke alarm and carbon monoxide detector In the sale of all one-family and two-family homes, condominiums and cooperatives, the seller must give an affidavit to the buyer that states the dwelling has operable smoke and carbon monoxide detectors.

A non-profit organization wants to erect a much needed daycare center in a residential zone. Given other favorable circumstances, the local authorities grant permission by allowing what?

A special use permit

The real estate transfer tax is:

A transfer fee based on how much money the seller gets

The legal discipline that deals with rules, regulations, and orders to carry out regulatory powers is

Administrative law.

Which body of law consists of the rules regarding how one person may act on behalf of another?

Agency law

What statement does RESPA require loan servicers to give to borrowers every year?

An escrow statement showing inflows and outflows for the year. Loan servicers must provide borrowers with an annual escrow statement which summarizes all inflows and outflows in the prior 12-month period.

What is a black book?

An offering plan

When does RESPA require loan servicers to provide an escrow statement to a borrower?

Annually Loan servicers must provide borrowers with an annual escrow statement which summarizes all inflows and outflows in the prior 12-month period.

Which of the following is a method of Alternative Dispute Resolution in which a party has the power to make a final, binding decision?

Arbitration

When is a title insurance policy issued?

At settlement

When is a title insurance policy issued?

At settlement A title insurance policy is issued at settlement.

If a property transaction closes on January 3 with unpaid property taxes, who is responsible for paying the taxes?

Both the buyer and seller Property taxes are an expense that is prorated at closing and divided proportionately between the buyer and the seller using either the 12 month/30 day method or the 365-day method of calculation.

What section of the Closing Disclosure shows how the final costs of the loan compare to the Loan Estimate the lender originally provided to the borrower?

Calculating Cash to Close on page 3 The top of page 3 shows how the final costs of the loan compare to the Loan Estimate the lender originally provided to the borrower and then calculates the amount of cash the borrower will need at closing.

Which of the following is NOT a federal bankruptcy code?

Chapter 12

What form does TRID require to be used for itemizing closing costs?

Closing Disclosure

Which of the following laws created the Superfund?

Comprehensive Environmental Response, Compensation and Liability Act

Which of the following would NOT apply to cooperative ownership?

Deed Co-op purchasers do not receive a deed to their property.

Condominium common elements can include which of the following?

Elevator

What is the seller required to have at closing?

Evidence of title

RESPA applies to all

FHA financing transactions.

Under the Freshwater Wetlands Act, which of these activities would NOT require a permit?

Fishing Examples of activities that are exempt and do not require a permit include recreational activities, such as fishing, hunting, hiking, swimming, camping or picnicking.

In a property management agreement, the property manager is the:

General agent The management agreement is the employment contract for a property manager, with the owner as the principal and the manager as the general agent.

What is a "regulatory taking?"

Government controls have so restricted a landowner's development rights that the land has become useless. A regulatory taking refers to the "taking clause" of the Fifth Amendment which says, in part, that private property cannot be taken for public use without just compensation. If a property owner's right to develop his or her land is restricted by government controls to the point where the land becomes basically useless, the courts could find that the taking was illegal and order compensation be paid to the property owner.

Balancing the environmental impacts with social and economic factors is regulated by which Act?

NY's State Environmental Quality Review Act

Which type of law is addressed in the UCC?

Personal Property law

Which is the most common type of framing for residential construction?

Platform

What are restrictive covenants?

Private land use controls

RESPA requires lenders to:

Provide a loan estimate of settlement costs RESPA requires lenders to provide a copy of "your home loan toolkit" at the time of loan application, provide a loan estimate at the time of loan application or within 3 business days of application, and deliver a closing disclosure form to the borrower at least 3 days prior to closing. RESPA prohibits payment or receipt of a fee for services not rendered.

What is the function of a lis pendens?

Provide notice that an action has been filed against a property

The highest part of the roof frame that forms the top line of the roof is the

Ridge beam

A location's infrastructure is made up of its:

Services

Which of the following is NOT part of the development process?

Spot zoning

Which of the following is considered a wetland?

Swamps

Which of the following is a necessary condition if a New York broker wants to file a mechanic's lien for an unpaid leasing commission?

The lease term is for three or more years.

Who should have title insurance?

The lender and buyer Both the buyer and the lender should have title insurance to ensure a clear title, to protect the buyer's investment, and to protect the lender's interest in the property.

Which of the following statements about condominium ownership is TRUE?

The owner receives a deed for his or her unit.

Under TRID, how long before closing does the buyer have the right to review the completed settlement statement?

Three business days

Under the New York General Business Law, how long does a homeowner have to cancel a home improvement contract?

Three days

The culmination of a real estate transaction is the:

Title closing

Once the buyer and seller have verified that all purchase contract terms have been fulfilled, certain steps are taken in order. Which of the following steps is not in the appropriate order?

Title is delivered

What kinds of zoning variances are allowed in New York?

Use and area.

New York's General Business Law requires contracts for the sale of newly constructed housing to include all of the following warranties EXCEPT

a five-year warranty on all appliances and furnishings.

Subdivision regulations are generally developed by

a local planning board.

New York law requires sellers to disclose to their brokers and potential buyers

all hidden property defects they know about.

An attorney's opinion of abstract is based on an examination of

an abstract of title.

An attorney's opinion of abstract is based on an examination of

an abstract of title. An attorney's opinion of abstract states that the attorney has examined a title abstract, and gives the attorney's opinion of the condition and marketability of the title.

Agency law deals with

authorization of one person to act for another.

The right of due process includes the right to

be present at a court proceeding where one is a defendant.

The authority that oversees and acts as "gatekeeper" for all construction activity in a community is the

building department.

The kind of law that deals with the rights and relations of people in trade or commerce is

commercial law.

The court that first hears a case in New York is called the

court of original jurisdiction.

Borrowers usually do not shop for

credit reports.

The most important document at any closing is the

deed. The deed is the most important document at closing, since it transfers the property to the purchaser.

If a property owner in New York dies without a will and without legal heirs, the property

escheats to the state.

A planning board is NOT responsible for

estimating land value.

A planning board is NOT responsible for

estimating land value. A planning board approves site plans, rules on zoning issues, and issues building permits.

Proof of ownership of a property is called

evidence of title.

BTUs are a measure of

heating or cooling capacity.

In an area where the Freshwater Wetlands Act applies, a permit is required for

installing a dock.

Unless renewed, a mechanic's lien expires after

one year.

RESPA applies to all of the following EXCEPT

seller-financed loans.

In platform framing, the members that frame the structure are the

studs. The pieces of wood that are used in a structure's framing are called studs.

The New York Real Property Law requires a person who wants to subdivide land for installment sale to New York state residents to

submit a filing statement and an offering statement to the Department of State.

To determine how much a buyer must bring to a closing, the escrow agent will

subtract the buyer's total credits from the buyer's total debits. In order for the buyer to know how much money to bring to closing, the escrow agent will subtract the total of the buyer's credits from the total debits and the result will be what the buyer needs to bring to closing.

To determine how much a seller will receive at a closing, the escrow agent will

subtract the seller's total debits from the seller's total credits. The agent will subtract the seller's total debits from the total credits to arrive at what the seller will receive at closing.

The four general categories of wetlands in the United States include

swamps.

The 1992 Lead-Based Paint Hazard Reduction Act does NOT require a seller to

test for lead.

Before an offering plan for a condominium or cooperative development can be given to the public, it must be approved by

the New York State Attorney General's office. Before the offering plan can be distributed, it must be reviewed by the New York State Attorney General's office to be sure the information is accurate and complete according to NY State legal requirements.

If a seller fails to provide a property condition disclosure to a buyer before the buyer signs the purchase contract,

the buyer receives a $500 credit at closing.

Under the Doctrine of Laches, a lawsuit may be barred from court if

the plaintiff waited an unreasonable time to begin the action. The doctrine of laches can bar an action if there has been an unreasonable delay, neglect in asserting a right or claim, and detriment to another as a result of the delay or neglect.

Before lot, block, and subdivision descriptions can be used as legal descriptions,

the subdivision plat must be approved and recorded.

Before a case can go to an appellate or supreme court, it must first be heard and decided in a(n)

trial court.

Real estate closings are usually held

wherever the contract specifies.