CRE Missed questions
Private property that is abandoned is taken by the local government. This is an example of:
Escheat This is a classic example of property that government can take over through escheat, another example would be a person dying without a will and no living relatives. The term is often now applied to the transfer of the title to a person's property to the state when the person dies intestate without any other person capable of taking the property as heir. For example, a common-law jurisdiction's intestacy statute might provide that when someone dies without a wil
K rented a summer cottage for the first two weeks in July. What type of tenancy does K have?
Estate For Years
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?
Explanation 50 x 6 = 300 + 100 x 6 = 600 + 6 X 6 = 36 = 936 sq ft X $.68 = $636.48 And just to add to the fun. This is a real question on the real State licensing exam. There is another variation on it that appears where the sidewalk is being built on INSIDE of the property line which requires you to SUBTRACT 36 sq ft to keep the two sides from overlapping. Now you know
Depreciation caused by deterioration to the physical structure is: Functional Obsolesence Physical Obsolesence External Obsolesence Deteriorating Obsolesence
External Obsolesence
When advertising, which is the correct way?
Joseph Magnum, ABC Realty Inc. (Answered Correct)
Who shall request the earnest money be released, in good funds to the closing clerk, prior to closing? Buyer Seller Listing agent Buyer agent
Listing agent Explanation The listing agent generally requests it from the broker at least 24 hours before closing. From the Contract to Buy and Sell (Purchase Contract) Good Funds. All amounts payable by the parties at Closing, including any loan proceeds, Cash at Closing and closing costs, shall be in funds that comply with all applicable Colorado laws, including electronic transfer funds, certified check, savings and loan teller's check and cashier's check (Good Funds).
The rights of a landowner to use waters of an adjacent lake or ocean are known as:
Litoral Rights (Answered Correct)
What, if anything, is required by the broker to be included on his/her website. License number of the brokerage and a list of all current active licensees Names of active licensees, addresses, and telephone numbers Address of the brokerage's home office and states in which the brokerage holds licenses Name of licensee's brokerage firm
Name of licensee's brokerage firm Explanation Commission rules regarding advertising of brokerage identity apply to any website or internet advertising; brokerage name must appear on website.
67 of 125 Questions Notes 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?
No, the new listing broker earned the listing side commission
John Johnson owned a parcel of land around his copper mine. He sold the mine and property for $230,000 with the verbal understanding that copper already mined before the date of sale would not be included in the sale. The mined copper is considered by law as:
Personality. Any mineral that has been removed from below the surface is personality.
John Johnson owned a parcel of land around his copper mine. He sold the mine and property for $230,000 with the verbal understanding that copper already mined before the date of sale would not be included in the sale. The mined copper is considered by law as:realtya fixturepersonaltysub rosa
PersonalityAny mineral that has been removed from below the surface is personality.
A person who engages another to act in his/her behalf is called a/an:
Principal
Publishing a foreclosure notice of sale in a newspaper is the duty of the:
Public Trustee
A defect or a cloud of title of a property is best cured by:
Quitclaim Deed
The land description T3N, R4W 5th Principal Meridian refers to what method of property description?
Rectangular Survey System
A client is buying an old gas station with the intention of building a flower shop. The lender will likely ask for:
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
Brokers should provide safeguards on seller-assisted down payments on:
Residential transactions
The rights of an owner with property abutting the bank of a stream, river, or creek, is/are called;
Riparian Rights
A Transaction-broker may NOT do which of the following without ending his/her Transaction broker obligations:
Sell a buyer his own personal residence
Who should hire a closing company?
Seller
The fee to notarize a Warranty Deed is charged on the settlement statement to:
Seller ( Answered Correct)
If a contract is signed under duress, it is:
Voidable
A broker enters into an exclusive right-to-buy contract with a purchaser. The purchaser finds a satisfactory property and makes an offer, which is accepted. The listing broker is unavailable during much of the transaction and the selling broker performs several of the listing broker's responsibilities. In gratitude, the seller offers a $500 bonus to the selling broker. When is it acceptable for the broker to receive this money?
With full written disclosure to both parties
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? Yes, this is blockbusting Yes, this is redlining No, as long as the properties she sells do not involve government loans No, as long as no explicit statements are made as to race or origin
Yes, Blockbusting
A buyer has a signed Contract to Buy/Sell Real Estate to purchase a property for $200,000. Prior to close, $25,000 worth of damage occured. May he/she terminate the agreement?
Yes, When the damage exceeds 10% of the agreed upon purchase price(Causes of Loss, Insurance. In the event the Property or Inclusions are damaged by fire, other perils or causes of loss prior to Closing in an amount of not more than ten percent of the total Purchase Price (Property Damage), Seller shall be obligated to repair the same before Closing Date. Buyer has the Right to Terminate on or before Closing Date, if the Property Damage is not repaired before Closing Date or if the damage exceeds such sum.)
Can a broker in Colorado give a finders fee to an out-of-state broker?
Yes, if the out-of-state broker resides and maintains an office in the other state(Commission Rule E-23 states that a Colorado broker who cooperates with a broker who is licensed in another state or country may pay such out-of-state broker a finder's fee or share of the commission if: (1) such broker resides and maintains an office in the other state or county, (2) all advertising, negotiations, contracting, and conveyancing done in Colorado is performed in the name of the Colorado broker, and (3) all money collected prior to the closing is deposited in the name of the Colorado broker.)
If an offer is given that fulfills all the terms of a contact and the seller rejects that offer - what happens?
a. The listing broker is entitled to a commission b. The listing broker receives no commission c. The listing broker can sue for specific performance d. The listing broker is entitled to a partial commission for services rendered A. When we, as agents, enter an agreement to market someone's property, we are tasked to bring them a "ready, willing and able buyer". We do that - we get paid. If we do that and the seller gets cold feet, rejecting an offer which met all of the seller's stated requirements, nobody can force the seller to sell, but we did our job and the seller may be liable for a commission to the listing agent.
The information a broker must keep about a deposit into an escrow account does not include:
address of affected parties
A counterproposal:
amends the terms and conditions of a proposed contract to buy/sell
If a licensee fails to complete the continuing education requirements by the renewal date:
the license is placed on inactive status. A real estate license will not be renewed if continuing education requirements are not met; the license would be placed on inactive status.
Which of the following is required before an owner of a 35-parcel of undeveloped land may drill a well for water only?
the owner must obtain a well permit from the state engineer
In Colorado, all of the following topics are regulated by Real Estate License Law or Real Estate Commission Rules except:-qualifications of licensure-record keeping-ethical standards-Commission-approved contracts
topics are regulated by Real Estate License Law or Real Estate Commission Rules except:-qualifications of licensure-record keeping-ethical standards-Commission-approved contracts Ethical standards
If mineral rights are not listed in the deed, and not previously transferred, the rights are:
transferred to the grantee
In addition to taking the required 168 hours of course instruction to become an associate broker, one must also:
hang their license under an employing broker Explanation An associate broker needs to pass the state and uniform state exam and hang their license under an employing broker.
According to the approved Colorado Contract to Buy and Sell Real Estate, may the purchaser assign the contract to another purchaser?
if specified in Additional Provisions and seller approves Explanation By default the Contract to Buy an Sell Real Estate does not allow the Buyer to assign the contract to another Buyer unless the right to do so is written into the Additional Provisions section of the contract. This give the Seller the opportunity to approve or disapprove.
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:
inactive On the date a license expires, for the following 30 days it is placed into an "inactive" status and may be renewed by paying the regular renewal fee. After 30 days it is placed into an "expired" status. Renewing an expired license requires the payment of additional fees and satisfying additional educational requirements.
If a landlord fails to refund the security deposit within one month (up to 60 days if specified in the lease) of the tenant surrendering the property, the landlord:
is liable for treble the amount wrongfully withheld
If a broker is accused of a violation of license law in a complaint to the commission and the commission investigative staff determines that the violation probably happened, the commission
may decide to refer the matter to a hearing before an appointed administrative law judge.
The person who gets a real estate loan by signing a note and mortgage is the:
mortgagor
Which of the following is true with regard to the approved Earnest Money Promissory Note?
must be due early enough to assure good funds for 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?
50 X 6 = 300 + (94 X 6 =564) = 864 sq ft X $.68 = $587.52
A Corporation, LLC, Partnership must have E&O insurance for entity and employing broker.
True
A parcel of land described as "the NW 1/4 and the SW 1/4 of Section 6, T4N, R8W of the Third Principal Meridian" was sold for $875 per acre. The listing broker will receive a 5 percent commission on the total sales price. How much will the broker receive?
$14,000LOOK AT THE QUESTION-is there an "and"?NW640÷4=160160×875=140,000SW640÷4=160160×875=140,000140,000×2=280,000÷5%=14,000
A legal easement can be created by any of the following EXCEPT
1. merger of the titles. Explanation When two titles are emerged it means that two properties have been merged into one. Any easements between the two are extinguished as no longer necessary.
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?
14.97$98.000 / 100 = 980 X $.22 =$215.60 X 2.5 years = $539 / 36 months = $14.97 Dive by 36 months because it is 3-years.
A man earns $20,000 per year and can qualify for a monthly PITI (Principal, Interest, Taxes, Insurance) payment equal to 25% of his monthly salary. If the annual tax and insurance is $678.24, what loan amount will he qualify for given a monthly PI (Principal Interest) payment factor is $10.29 per $1000 of loan amount? To be clear, a payment factor Is the amount of money a borrower will pay for each $1,000 of loan amount.
$35,0001)First, we better figure out how big a monthly payment he can afford. He makes $20,000 a year. $20,000/12 months = $1,666.67 a month. $1,666.67 x 25% = $416.67 monthly payment he can afford2) Next, let's subtract the taxes and insurance to see how much will be left for the loan. $678.24 (annual Taxes and Insurance / 12 months = $56.52. $416.67 - $56.52 = $360.15 left over to pay Principal and Interest each month.3) Last up - how many thousands worth of loan can he get for $360.15 a month? The PI (Principal Interest) payment factor is $10.29 per $10000 of loan (comes from a chart). In English this means each $1000 of loan amount will cost him $10.29 per month. So......$360.15 (money he has available to pay principal and interest each month) / $10.29 = 35 thousands or $35,000.
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?March 1April 30May 1June 16
(Answered Correct) April 30Real property taxes may be paid as follows: if the owners wants to make payments, one-half is due on or before the last day of February and the remaining one-half on or before June 15. If the owner wants to make one full payment, the entire tax may be paid on or before the last day of April
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?
1 year
The question - All of the following are true regarding the Exclusive Right-to-Sell listing contract except:
1. ( ) there is a one contract for all types of listings2. ( ) a listing contract may establish seller-agency3. ( ) a listing contract may be executed without establishing agency4. ( ) more than one listing contract may be executed for the same period of time, for the same property ExplanationHello C, Lets first address the correct answer to the question and then your question. Correct is 4 - The Right to Sell Listing contract provides exclusivity to the listing broker to sell the property. The broker will be entitled to compensation regardless of who sells the property. If there is more than one listing contract active at the same time, the seller could be liable for multiple commissions to be paid. Commission Rule E-13 does not allow a real estate licensee to enter into an exclusive listing agreement with a seller if there is a listing contract currently in force with another licensee. It allows a listing contract executed that will become effective upon the expiration of the listing currently in force - but the two cannot be in effect concurrently. The reason the third answer is true (and therefore not the right answer to this question), a listing contract can be executed without establishing agency by simply checking the Transaction Broker box. At that point the licensee is not an agent (with agency duties) but a Transaction Broker. If the Seller Agency box was checked an agency relationship would have been established. The understand why a Transaction Broker is not an agency relationship you have to understand the agency relationship. An agency relationship is a consensual relationship created by contract or by law where the principal grants authority to the agent to act on behalf of and under the control of the principal to represent the principal with a third party. Only the Buyer and Seller Agency relationships are agency relationships. When you are a Transaction Broker you are in a "working relationship" not an "agency relationship". The Transaction Broker is a neutral party, much like a referee in a sport, the TB can assist with the transaction, but cannot advise the principal as to the risks or benefits of the transaction, nor can the TB become an advocate for the interests of the principal. Those are duties reserved to an agency relationship where the Buyer or Seller Agent is a coach for the principal. An agency relationship is referred to as "fiduciary" as the actions and words of the agent with a third party bind the principal. A TB is not "fiduciary" as the words and actions of the TB DO NOT bind the principal. The only items which bind the principal when a Transaction Broker is involved are the contracts signed by the principal.
Ms. Nation, an eligible veteran, made an offer of $95,000 to purchase a condo she will finance with a VA-guaranteed loan. Four weeks after the offer was accepted, a certificate of reasonable value (CRV) for $92,000 was issued for the property. In this case:the veteran may withdraw from the transaction without penalty or negotiate with the seller to reduce the price to $92,000the seller can finance a second mortgage for the remaining balancethe veteran can purchase the property, provided she can get an additional loan for a $3,000 down paymentthe veteran can wrap the $3,000 into the financed loan costs
9 answered correct the veteran may withdraw from the transaction without penalty or negotiate with the seller to reduce the price to $92,000The seller would need to come down on the purchase price, the buyer can put the $3,000 down, or the veteran may withdraw from the transaction.Definition of Certificate of Reasonable Value (CRV)A document issued by the Department of Veterans Affairs as a prerequisite for a VA loan; it is based on an approved appraisal. It establishes the maximum value of the property for VA purposes and, as a result, the maximum size of the VA loan.
mortgagee/mortgagor
A mortgagee is the lender in a mortgage loan transaction; a mortgagor is the borrower in a mortgage loan transaction.
Pursuant to an exclusive right-to-buy contract, a broker:
A: may always show the same property to another buyer The exclusive right to buy contract contains a clause authorizing the broker to show properties to more than one buyer.
The furnace breaks down before closing, but after the buyer has taken possession. Who is responsible for the cost of replacement? 1) Seller2) Buyer3) depends on how the appropriate box is checked in the Contract to Buy and Sell4) not addressed by the Contract to Buy and Sell
Answer: 2 is correct. The buyer is responsible for such costs after possession, even if possession is before closing. From the Contract to Buy and Sell Real Estate: Damage, Inclusions and Services. Should any Inclusion or service (including utilities and communication services), system, component or fixture of the Property (collectively Service), e.g., heating or plumbing, fail or be damaged between the date of this Contract and Closing or possession, whichever is earlier, then Seller is liable for the repair or replacement of such Inclusion or Service with a unit of similar size, age and quality, or an equivalent credit, but only to the extent that the maintenance or replacement of such Inclusion or Service is not the responsibility of the Association, if any, less any insurance proceeds received by Buyer covering such repair or replacement. If the failed or damaged Inclusion or Service is not repaired or replaced on or before Closing or possession, whichever is earlier, Buyer has the Right to Terminate under § on or before Closing Date (§) , or, at the option of Buyer, Buyer is entitled to a credit at Closing for the repair or replacement of such Inclusion or Service. Such credit must not exceed the Purchase Price. If Buyer receives such a credit, Seller's right for any claim against the Association, if any, will survive Closing. Seller and Buyer are aware of the existence of pre-owned home warranty programs that may be purchased and may cover the repair or replacement of such Inclusions.
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?
Answer: 30 ExplanationMEDIATION. If a dispute arises relating to this Contract, prior to or after Closing, and is not resolved, the parties must first proceed in good faith to submit the matter to mediation. Mediation is a process in which the parties meet with an impartial person who helps to resolve the dispute informally and confidentially. Mediators cannot impose binding decisions. The parties to the650 dispute must agree, in writing, before any settlement is binding. The parties will jointly appoint an acceptable mediator and will share equally in the cost of such mediation. The mediation, unless otherwise agreed, will terminate in the event the entire dispute is not resolved within thirty days of the date written notice requesting mediation is delivered by one party to the other at the party's last known address. This section will not alter any date in this Contract, unless otherwise agreed.
A court order that authorizes and directs the proper officer of the court to sell the property of a defendant as required by the judgment or decree of the court is known as a writ of attachment a writ of execution constructive eviction actual eviction
Answer: A Writ of Execution
Addition to the land through natural causes, usually by a change in water flow accession acquisition accretion annexation
Answer: Accretion
Who does get the charge for notarizing a warranty deed on a settlement sheet: The fee to notarize a Warranty Deed is charged on the settlement statement to: 1) the buyer 2) the listing broker 3) the seller 4) the buyer and seller
Answer: Correct is 3. The seller(s) signs the warranty deed, not the buyer. The charge is debit seller. On the settlement sheet do not confuse "recording" the deed with "notarizing" the deed. Recording the deed is "debit buyer" as it is considered in the buyers best interest to have the deed recorded into the public record. For more info: THE WARRANTY DEED - Although title may be transferred by a number of types of deed such as a quit claim deed, the most common type of deed used in a closing to transfer title is the warranty deed. The seller signs the warranty deed, not the buyer. In addition, a notary public must notarize the deed and an unofficial witness who is not a party to the transaction must sign as well so the deed can be recorded. The notary and the witness are usually employees of the closing attorney, although sometimes the attorney may ask the licensee to be a witness. Once the seller, the notary, and the unofficial witness have signed the deed, and the seller or attorney hands (delivers) it to the buyer and the seller has officially transferred title. It is standard practice for the attorney to keep the original warranty deed at closing for recording at the courthouse. The original deed is then mailed to the buyer after the recording.
The Real Estate Commission may issue a temporary "hardship" license when the employing broker of a corporate brokerage is unable to continue in that role. This "hardship" license may be issued to: 1) A member of the board of directors2) A person who has a sufficient ownership in the corporation3) An officer or director with a broker's license from another state4) A Colorado licensee approved by the corporate board of directors
Answer: Correct is 4. Every company must have an employing broker at all times. If something should happen to an employing broker, such as leaving the company, the real estate commission can issue a "hardship" license to someone else to act as the interim employing broker while the company settles on a permanent employing broker. The only rule for the "hardship" employing broker is that he/she must have an active Colorado license. The problem with someone who is a sole proprietor i.e. they are an independant agent working for themselves, is that there is no one else in the company to become the employing broker. Statute below: Rule 12-61.103 (7) (3) - "If the person so designated is refused a license by the real estate commission or ceases to be the designated broker of such partnership, limited liability company or corporation, such entity may designate another person to make application for a license. If such person ceases to be the designated broker of such partnership,, limited liability company or corporation, the director may issue a temporary license to prevent hardship for a periord not to exceed 90 days to the licensed person so designated."
In this situation, the grantor promises to obtain and deliver any instrument needed to make the title good is the: covenant of seisin covenant against encumbrances covenant of quiet enjoyment covenant of further assurance
Answer: Covenant of Further Assurnace
The easement that is not created for the benefit of the land owned by the owner of the easement, but that attaches personally to the easement owner is known as an
Answer: Easement in Gross (Answered Correct) easement in gross easement by condemnation easement by necessity easement by prescription
The sealing off of disintegrating asbestos is one method of asbestos control. This is known as
Answer: Encapsulation (Answered Correct) irradiation encapsulation capping removal of tanks
The type of lease that allows for the step-up of rent payments and is used to attract tenants to difficult-to-rent properties is called a: percentage lease graduated lease index lease assignment lease
Answer: Graduated lease A graduated lease allows for a periodic increase in payments.
The type of lease that allows for the step-up of rent payments and is used to attract tenants to difficult-to-rent properties is called a: percentage lease graduated lease index lease assignment lease
Answer: Index Lease (Answered Correct)
Depreciation caused by deterioration to the physical structure is:
Answer: Physical obsolescence Explanation One of the three forms of obsolesence along with Functional and External. Physical Obsolesence is a loss of value due to wear and tear or deferred maintenance.
The system established in 1785 by the U.S. government, which describes land with principal meridians and base lines, is called
Answer: Rectangular survey System Point of Beginning lot-and-block system rectangular survey system metes-and-bounds
A payment by a tenant, held by a landlord during the lease term, is called: earnest money security deposit consideration lien
Answer: Security Deposit
The possession of land by one who claims to own at least an estate for life is known as: seisin statutory lien special use permit covenant against encumbrances
Answer: Seisin ( Answered Correct)
The type of plan for a loan calls for payments of interest only, with the principal to be paid in full at the end of the loan term is called a(n): straight loan adjustable rate mortgage fully amortized loan partially amortized loan
Answer: Straight Loan
A valid contract that cannot be enforced by a court is called: Void Enforcable Invalid Unenforcable
Answer: Unenforcable Explanation A valid contract may be unenforcable in court for reasons such as: 1) it is not in writing, therefore it cannot be proven. Many States have passed what is often referred to as a "Statute of Frauds" which explicitly indicates that an oral contract is not enforcable. 2) a statute of limitations period has passed 3) certain government contracts are not enforcable or are limited in enforcement against the government
The buyer or purchaser under a land contract is also known as the: vendee vendor leasee leaser
Answer: Vendee
An action taken by a creditor in which the court simply retains custody of the property while a lawsuit is being decided is known as: a writ of attachment a writ of execution constructive eviction actual eviction
Answer: Writ of Attachment (Answered Correct)
The grantor guarantee that he/she has the right to convey property is called: covenant of seisin covenant of further assurance covenant of quiet enjoyment covenant against encumbrances
Answer: covenant of seisin Explanation General Warranty Deed A general warranty deed is one in which the grantor warrants or guarantees title against defects that existed before the grantor acquired title or that arose during the grantor's ownership. It does not warrant against encumbrances or defects arising from the grantee's own acts. The usual covenants or warranties contained in a general warranty deed are: 1. Covenant of seisin. Guarantees the grantor's ownership and that he or she has the right to convey it. The fact that the property is mortgaged or is subject to some restriction does not breach this covenant. 2. Covenant against encumbrances. Guarantees that there are no encumbrances or claims against the property except those specifically excluded in the deed. 3. Covenant of quiet enjoyment. Guarantees that the grantee will not be evicted or disturbed in possession of the property. Threats or claims by a third party do not breach this covenant. The grantee would have to actually be dispossessed before being entitled to seek recovery against the grantor under this covenant. 4. Covenant of further assurance. Guarantees that the grantor will procure and deliver any other instruments that are subsequently necessary to make the title good. 5. Covenant of warrant forever. Guarantees that the grantee shall have title to and possession of the property. Sometimes considered part of "quiet enjoyment."
The joint ownership that is recognized in some states, of property acquired by husband and wife during marriage, is known as
Answer: tenancy by the entirety severalty joint tenancy tenancy by the entirety tenancy in common
Which would need to be registered with the CREC (Colorado Real Estate Commission) for a subdivision?
Answered Correct A 60 unit co-op buildingExplanationThe Subdivision Developer's Act affects the types of subdivisions that must be registered with the Commission. The following types of subdivisions within the State of Colorado, and subdivisions located outside the state if being offered for sale in Colorado, must be registered before offering, negotiating, or agreeing to sell, lease, or transfer any portion of the subdivision:* 1. Any division of real property into 20 or more interests for residential use;* 2. Subdivisions consisting of 20 or more time-share interests (a time share interest includes a fee simple interest, a leasehold, a contract to use, a membership agreement, or an interest in common);* 3. Subdivisions consisting of 20 or more residential units created by converting an existing structure (e.g., condominium conversions); and* 4. Subdivisions created by cooperative housing corporations with 20 or more shareholders with proprietary leases, whether the project is completed or not.
The commissioners are selected in the following way:
Answered Correct Appointed by Governor
A mortgage that covers several parcels of land and contains a provision that allows for the sale of an individual parcel with clear title is called:
Blanket Mortgage (answered correct)
Which of the following is correct according to the Colorado Real Estate Commission Position Statement regarding Rule F?
Brokers may not add exculpatory language limiting their liability to any contract to which they are not a party such as the Contract to Buy and Sell.
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.
Buyer Must Proceed
When making a counter offer by using the approved Counterproposal form - how do you change dates?
Change only the dates that needed to be changed (Answered Correct)
A negative balance in a trust account is likely due to:
Commingling having occured It is not the agents money so it should never be negative. If it is, something bad has happened.
What must appear in the title of a trust account?
Company name and employing broker's name
When the grantor (the owner) offers the grantee (the buyer) a General Warranty Deed transferring ownership; the grantor warrants that the property is free from liens and encumbrances through which Covenant? covenant of seisin covenant of further assurance covenant of quiet enjoyment covenant against encumbrances
Covenant Against encumberances (Answered Correct)
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
D. the seller may terminate the contract and return the earnest money
Which does the buyer have to disclose to the seller when using the Licensee Buyout Addendum?
D: All of the above That the Buyer stands to make a profit That the Buyer is exposed to possible losses and expenses that the property may be immediately sold by the Buyer All of the above are required disclosures
For a VA loan - how will the Buyer's Loan Processing Fee be shown on a settlement sheet
Debit Seller
Unless modified, the powers granted in a Colorado statutory power of attorney for property are:
General In Scope
Stan is a real estate broker in Colorado. He has identified a property for a fast food outlet and has asked four friends to contribute money to the purchase and gain partial ownership. Stan will manage the property and negotiate the lease for the fast food franchise. Which of the following is correct with regard to Stan's role as a broker in this arrangement?
He must comply with state and federal securities laws in arranging this investment group
If a client asks whether it would be beneficial to add a second bathroom to increase profit on the sale of the home, what would be the appropriate response?
I would be happy to do some research or analysis and speak to a construction expert on costs to determine if it's worth it
A lease that changes periodically based on the Consumer Price Index is:
Index Lease A periodic rent adjustment is based on changes in a designated economic index such as the prime lending rate or the consumer price index (CPI) e.g cpi is and it increase 125% in a given year.
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 through and 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. What is the brokerage relationship between Seller Samuel and Broker Cleary?
Seller Agency b. Broker Cleary advised Seller Samuel as to the counter offer. Only a broker fiduciary relationship such as Buyer or Seller Agency can act as an advocate and coach a client on a transaction. Transaction Brokers have a non-fiduciary working relationship and as such cannot advocate on behalf of a client.
The Licensee Buyout Addendum informs the Seller of all EXCEPT:
Seller is responsible for marketing and closing expenses
The Real Estate Commission may NOT issue a temporary license to prevent hardship to a:
Sole proprietor (Answered Correct)
The most likely source of information for what water rights exist for a property with a well would be:
State Engineer - Colorado Department of Natural Resources
Q: 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 obligationb)The buyer is the offereec)The seller is the offerord)The buyer is the offeror
The correct answer is d. When the buyer made her original offer, she was the offeror and the seller was the offeree. Once the seller countered the buyer's original offer their roles reversed. The seller became the offeror because the counterproposal constituted a new offer and the buyer receiving it was the offeree. As to her original offer; since the seller rejected it, the buyer was under no further obligation as to her original offer. Definition of 'Discount Points' Discount Points are a form of prepaid interest. A borrower buys a point and in return gets a lower interest rate on the loan. Each discount point generally costs 1% of the total loan amount and depending on the borrower, each point lowers your interest rate by one-eighth to one one-quarter of your interest rate. As the IRS considers discount points to be prepaid interest they are tax deductible in the year in which they were paid. For example, on a $300,000 loan, each point would cost $3,000. Assuming the interest rate on the mortgage is 5% and each point lowers the interest rate by 0.25%. Buying 2 points will cost $6,000 and will result in an interest rate of 4.50%. Both lenders and borrowers gain benefits from discount points. Borrowers gain the benefit of lowered interest payments down the road, but the benefit applies only if the borrower plans on holding onto the mortgage long enough to save money from the decreased interest payments. Lenders benefit by receiving cash upfront instead of waiting for money in the form of interest payments over time, which enhances the lenders liquidity situation. On a practical basis; discount points are most often purchased by sellers as an incentive to prospective buyers. For most sellers, discount points are a cost of selling and thus tax-deductible. Buyers usually do not see enough benefit to purchase discount points. In the earlier example; spending $6,000 to reduce the interest rate to 4.5%, would have reduced the monthly payment by about $90. It would have taken a buyer 67 months to cover the cost of the points. Have a great weekend and stay dry!
Which of the following items are signed by the buyer, seller, or lender and not sent to the county for recording? The deed of trust The warranty deed The satisfaction of the seller's mortgage The promissory note
The promissory note Explanation The buyer signs the deed of trust; the lender signs the satisfaction of mortgage; the seller signs the warranty deed; they are all recorded.
All units in a community are being assessed for sidewalk improvements to a road along one side of the community. This is:
This is a Special Assessment
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:
This is not an enforceable contract and Rockwell is not entitled to a commission Explanation An offer can be withdrawn anytime prior to acceptance. Acceptance means the offer has been signed AND acceptance communicated to the other party. Since the postmark is the date of acceptance the offer had been withdrawn prior to acceptance.
In order to be the named broker for a corporation doing business in several states, a broker should:
be an officer and a director of the corporation
The purchase and sale contract stipulates how many discount points a loan will incur and who will pay them. The Title Company uses this information to determine:
whether to debit the seller Explanation Discount points are a charge. Most often they are an incentive offered by the Seller to buy down (lower) the Buyer's interest rate. 1 discount point is 1% of the loan amount. The IRS considers discounts points to be "prepaid interest" and thus tax deductable for the person paying them - in this case the Seller. The only place in the purchase contract where this is addressed is in Seller Concessions. Debit Seller. Definition of 'Discount Points' Discount Points are a form of prepaid interest. A borrower buys a point and in return gets a lower interest rate on the loan. Each discount point generally costs 1% of the total loan amount and depending on the borrower, each point lowers your interest rate by one-eighth to one one-quarter of your interest rate. As the IRS considers discount points to be prepaid interest they are tax deductible in the year in which they were paid. For example, on a $300,000 loan, each point would cost $3,000. Assuming the interest rate on the mortgage is 5% and each point lowers the interest rate by 0.25%. Buying 2 points will cost $6,000 and will result in an interest rate of 4.50%. Both lenders and borrowers gain benefits from discount points. Borrowers gain the benefit of lowered interest payments down the road, but the benefit applies only if the borrower plans on holding onto the mortgage long enough to save money from the decreased interest payments. Lenders benefit by receiving cash upfront instead of waiting for money in the form of interest payments over time, which enhances the lenders liquidity situation. On a practical basis; discount points are most often purchased by sellers as an incentive to prospective buyers. For most sellers, discount points are a cost of selling and thus tax-deductible. Buyers usually do not see enough benefit to purchase discount points. In the earlier example; spending $6,000 to reduce the interest rate to 4.5%, would have reduced the monthly payment by about $90. It would have taken a buyer 67 months to cover the cost of the points.
What does not need to be placed into an escrow account?
withholding taxes
