contract
Which of the following does not require agency disclosure?
A lease for 10 months
An individual who is delegated to legally act for another person is known as:
an attorney in fact
Of the following, what is not needed in the formation of a contract?
performance
Compliance with agency relationship law, which is enacted and part of the civil code, is required in which of the following transactions?
A lease for a period lasting for more than one year
How can a minor or incompetent person acquire property without requiring court approval?
Acquire real property by way of a gift or an inheritance
According to the Civil Code, which of the following is a fiduciary duty of the agent working for a buyer?
Acting with the utmost care, integrity, and honesty when working with buyers
The real estate disclosure law, which came into effect January 1, 1988, refers to the:
Agency Relationship Disclosure
Per the statute of frauds, which of the following must be in writing?
An agreement by a purchaser of real property to pay a debt secured by a mortgage or deed of trust on the property purchased
The law of agency states that an agent has imputed authority of their principal when dealing with third parties. What does that imputed power allow?
It usually binds the principal as long as the authority is granted to the agent
The law of agency states that real estate agents have legal responsibilities to their principals. Which of the following does not apply?
Research what the reserves and expected expenses may be for the maintenance of a business
The law of agency states that real estate agents have legal responsibilities to their principals. Which of the following does not apply?The law of agency states that real estate agents have legal responsibilities to their principals. Which of the following does not apply?
Research what the reserves and expected expenses may be for the maintenance of a business
A manager for real property may be compensated in all the following ways, except:
paid by receiving discounts on purchases or supplies
A licensee who is working with their client to sell their real property to a third party is said to be operating under the law of:
agency
In order for a contract to be legal, which of the following would be considered consideration?
all of these
Of the following, which answer describes why it is critically important to disclose who represents whom in a real estate transaction?
all of these
Why is it considered essential that every party to a real estate transaction receive a full and complete disclosure of who is representing whom?
all of these
A real estate licensee may represent both sides of a real estate transaction, and:
all of these must be present
To be enforceable, a contract for real property must:
be in writing
Investor Joe owns a duplex priced at $100,000 and has a mortgage debt that is outstanding at $30,000. This property was sold using a 1031 exchange for a four-plex priced at $170,000 with a first mortgage balance of $100,000. For the exchange to be completed, on what profit amount will the owner have to pay property gain taxes on the profit of the first property?
$0
If a seller refuses to disclose that his property is in a flood zone on the transfer disclosure statement, what should the licensee do to protect themselves?
Decline the listing
The Law of Agency consists of the rights, liabilities, and duties between:
all of these
The very best way to create an agency relationship is:
in writing
When a false transfer disclosure statement is given to a buyer that omits facts about the property , how long does the buyer have to bring a lawsuit against the seller and the broker?
2 years
Two months ago a seller had accepted an offer from a buyer to purchase their real property. The contract was in writing and signed by both parties. Later, the seller refused to complete the transaction because they felt their property would increase in value in the near future and wanted to maximize their profit from the sale of the real property. From the information we know, how long would the buyer have to pursue legal action against the seller due to the breach of the written contract?
4 years
Seller Julie listed her vacation home with Agent Ann. When the sale is executed, the commission will be 7% if Agent Ann is able to find a buyer who is ready, willing, and able to purchase the property at the list price, or more. Agent Ann will utilize her best efforts to find a buyer for the listing. What kind of contract must be in place for any of this to happen?
A bilateral executory contract
Seller Charles put his property up for sale with agent Samantha for $100,000. The property sold very quickly and seller Charles was impressed how quickly everything occurred. Agent Samantha showed the property to buyer Pip and made buyer Pip aware that the seller was having financial difficulties and with that information, buyer Pip submitted an offer for $90,000 which seller Charles accepted. Which of the following is true about agent Samantha's actions?
Agent Samantha violated her fiduciary duty to the seller and acted in excess of her authority
When showing property to potential buyers, what must the listing agent disclose to the third party (buyer)?
All known material facts about the real property
Of the following, which would create a dual agency situation?
An agent is representing both the buyer and seller in the same transaction and all parties are aware and agree
Which of the following is required to create a legal and valid contract?
An offer and acceptance
If a broker misrepresents his principal's property, what could possibly happen to the principal?
Any of these
Otis bought the Browns' house through the Browns' listing agent Jacob. In October there was a heavy rainstorm and the roof leaked in several different spots. Otis took everyone involved in the real estate sale to court. During the trial it was announced that the seller Browns told their agent, Jacob, about the leaky roof and that its' condition was in disrepair. Agent Jacob withheld this information from buyer Otis because Otis "did not ask about the roof". What is the most likely outcome of the trial?
Buyer Otis recovered damages from seller Brown who then recovered damages from agent Jacob
Otis bought the Browns' house through the Browns' listing agent Jacob. In October there was a heavy rainstorm and the roof leaked in several different spots. Otis took everyone involved in the real estate sale to court. During the trial, it was announced that the seller Browns told their agent, Jacob, about the leaky roof and that its' condition was in disrepair. Agent Jacob withheld this information from buyer Otis because Otis "did not ask about the roof". What is the most likely outcome of the trial?
Buyer Otis recovered damages from seller Brown who then recovered damages from agent Jacob
A licensee receives an offer for a property they have listed. It's in writing, however it's below the asking price and they know the seller will never accept it. Of the following, which would not be acceptable for the licensee to do?
Change the terms to what the licensee thinks the seller would accept
A licensee receives an offer for a property they have listed. It's in writing, however, it's below the asking price and they know the seller will never accept it. Of the following, which would not be acceptable for the licensee to do?
Change the terms to what the licensee thinks the seller would accept
Which of the following is the best way to describe a broker's duty in keeping their principal informed and updated on the transaction?
Fiduciary duty
When does an agent inform others that they are working on behalf of a buyer?
Immediately
Of the following, which would not be legal for a licensee to do?
Not tell prospective buyers that the foundation has documented structural issues
Agency can be terminated in many ways. Of the following, which is not a way to terminate agency?
Notice to perform
When is a real estate agent obligated by law and the state regulations to communicate any offers to a principal?
Only if it's in writing
A broker who is hired by a property owner to sell their property must reveal all significant and material information to the seller. Of the following, which would be considered significant and/or material information and must be revealed?
The agent has been told by another broker that a higher priced offer is coming within the hour
When the broker is an agent to a seller, what is owed to the buyer?
The duty to be fair and honest
Of the following, which cannot create an agency relationship?
The agent offering to work for the principal
Which of the following scenarios would entitle a prospective buyer to damages against a real estate broker?
The broker exceeds the authority given to them by the principal
A seller tells their listing agent that the pool is uneven and leaks. The broker does not inform the buyers of this material fact. A few months after the buyer purchases the property, the buyer discovers the pool is leaking and is uneven. The buyer immediately files a lawsuit against the seller and the broker. The seller also files a lawsuit against the broker. What is the most likely outcome?
The buyer would win against the seller and the agent and the seller would win against the agent
Broker Steve has been employed by Seller Mike. Broker Steve has been showing the property to many interested home buyers and has been telling everyone that the roof was in great shape and did not have any issues or leaks, when in fact Seller Mike specifically told Broker Steve that the roof was old and had several leaks and would need to be replaced. Buyer Brian soon discovered that after the first rainstorm the roof was in terrible disrepair and leaked badly. Who would Buyer Brian have recourse against?
The seller and the broker for fraud and damages associated with the roof
When transferring certain real property, the California Civil Codes states that a transfer disclosure statement is to be delivered by which of the following?
The transferor
What is the name of a contract between the seller of real property and a licensed real estate agent, in which the seller agrees to pay a commission to the licensee if they produce a "ready, willing and able" buyer for the real property and the licensee complies and does all the due diligence procuring a buyer?
a bilateral executor contract
What is the name of a contract between the seller of real property and a licensed real estate agent, in which the seller agrees to pay a commission to the licensee if they produce a "ready, willing and able" buyer for the real property and the licensee complies and does all the due diligence procuring a buyer?
a bilateral executory contract
When a money award for damages does not satisfy the damages on a defaulted contract, a lawsuit for specific performance can be brought by all of the following, except:
a broker who has a current license acting on behalf of their principal
The fiduciary obligation to protect a client's confidential information should continue:
after the listing agreement term
According to the Statute of Frauds, all contracts must be in writing in order to be enforced in the court of law. Of the following choices, the statement that is not an example of this would be:
a lease agreement which is less than one year
The broker works on behalf of their principal. All of the following defines the relationship between the two parties, except:
a power of attorney relationship
Of the following, which is not needed to create an agency relationship?
a written agreement to pay consideration
A licensee who is acting as an agent for their principal in the sale of property can do the following without authority from the principal:
accept a purchase contract from a buyer that is signed and will become binding if the seller accepts it
Licensee Rob acts as an agent for both the buyer and seller and did not disclose that fact to both parties involved. It was not disclosed because licensee Rob was unaware that both buyer and seller considered him as their agent. Agent Rob is now involved in a:
accidental dual agency
A broker who looks for buyers and accepts a deposit from a buyer to purchase a piece of real property without the express written authorization and acknowledgment from the owner to sell the property is:
acting as an agent for the buyer, not the seller
If a seller declines to fill in their section of the Real Estate Transfer Disclosure Statement, the agent should:
complete the listing agent's portion of the transfer disclosure statement and submit it to the buyer
complete the listing agent's portion of the transfer disclosure statement and submit it to the buyer
complete the listing agent's portion of the transfer disclosure statement and submit it to the buyer
Of the following, none of the individuals may enter into a valid real estate contract to purchase property, except:
emancipated minors
Along with due diligence, care, and skill, a real estate agent must also fully disclose all material facts of the property to the principal. If there is any purposeful concealment of material facts by the agent, this could be regarded as:
fraud
Seller Johnson listed his home for sale with agent Mike. The listing stated "cash only offers to be considered and possibly accepted". Agent Mike brought a buyer who was qualified with a VA loan. Seller Johnson rejected the offer from agent Mike. What is agent Mike entitled to in regards to commission?
none of the commission
In the formation of a contract, which of the following would not make the contract voidable?
illegal purpose
Broker Robert is showing buyer Sarah property that he has under contract. Broker Robert is aware of a major defect in the plumbing. Broker Robert should:
inform buyer Sarah of this issue, because it is a material fact about the property
A binding contract between two parties can become voidable if:
it is legally retracted by one or both parties
In order for a seller who owns 1-4 units to be in compliance with the California Civil Code regarding Real Estate Transfer Disclosure Statements, the owner must:
make a reasonable effort to inspect the property, then complete the disclosure
All of the following are required for a contract to be valid, except:
must be in writing
Agent Mitchell has a listing to sell a home owned by owner Donald. Which of the following actions by the licensee would result in creating an agency relationship with a potential buyer?
negotiating for the buyer
When a licensee acts exclusively as a buyer's agent, they can:
present offers to the seller and seller's agent
Mr. and Mrs. Childers bought a property and they were not informed that it contained an oil tank buried in the ground that is used for heating the home. They would have the right to:
rescind the contract
During an "exclusive right to sell" listing contract, the principal no longer wishes the broker to work for them. The principal may:
revoke the listing, however the seller may be held liable for damages
concerning an interest in real property, when two parties want to create an enforceable broker/ principal relationship, what is the most important thing to create first?
sign a written employment contract
For a contract of real property to be enforceable, the consideration must be relative and of sufficient value in order to enforce a suit for
specific performance
For a contract of real property to be enforceable, the consideration must be relative and of sufficient value in order to enforce a suit for:
specific performance
Of the following, an agency cannot be created by:
subordination agreement
According to the California Civil Code, real estate relationships can be terminated in many ways. Which of the following is on that list?
termination by completion
According to the Civil Code, when serving as a buyer's agent, the real estate agent has a fiduciary duty to:
the buyer
When a licensee acts as a buyer's agent on a home listed by their broker, the broker has a fiduciary duty to:
the seller
The commission of a real estate listing for a lease property would typically be paid as a percentage of:
the total rent collected over the period (or time) of the lease, but can be negotiated
Seller Andrew sold a home to Buyer Bill. Buyer Bill was deemed to be legally mentally incompetent. In this type of situation, the contract would be:
void
If a contract is obtained under duress, that contract is:
voidable
Tenant Greg verbally agrees to mow the lawn for Owner Amanda. Week after week, Owner Amanda asks Tenant Greg to mow the lawn, yet nothing is done. After repeated attempts from Owner Amanda to have Tenant Greg mow the lawn, Owner Amanda writes up a contract and forces Tenant Greg to sign the contract stating that Owner Amanda will evict Tenant Greg if he does not comply with this action. This stipulation will make the contract:
voidable
