National Real Estate Test
right-of-way easement
Easement that grants access to property. Right-of-way easements allow pass-through and can be as short as a driveway or as long as a railroad track.
Lydia put the minimum 3.5% down on her $210,000 home. She'll have to pay an MIP. What type of loan does Lydia have? Conventional FHA Standard VA
FHA Based on the minimum down payment amount of 3.5% and the fact that she's paying MIP, Lydia has an FHA loan.
Stu is buying Freddie's property. What must occur for the transfer of title to take place? Freddie and Stu must sign the deed. Freddie must intend to convey the property to Stu. Stu must convey the deed. Stu must sign the deed.
Freddie must intend to convey the property to Stu. The seller (grantor) must deliver a marketable title. The grantee isn't required to sign.
Stu is buying Freddie's property. What must occur for the transfer of title to take place? Freddie and Stu must sign the deed. Freddie must intend to convey the property to Stu. Stu must convey the deed. Stu must sign the deed.
Freddie must intend to convey the property to Stu. The seller (grantor) must deliver a marketable title. The grantee isn't required to sign.
Which one of these would NOT be an element of comparison an appraiser would use when applying the sales comparison approach to a property valuation? Financing terms and cash equivalency Income generated Market conditions at time of sale Physical characteristics of the property
Income generated
Which of these is an example of severability? Jules and Katrina are under contract for the purchase of Katrina's house. A dispute arises over some contract terms, and they end up in court. The court rules one of the terms invalid but leaves the remainder of the contract in force. Mark's contract with Reuben states that either party may sever the contract if any contract term is only partially performed. Misty's lease agreement with Thomas contains a provision that permits her to sever the lease if Thomas doesn't remodel the apartment as promised. Ricardo and Timothy are under contract in the sale of Ricardo's office building. Ricardo's tenant leases gives him the option to sever the lease agreements upon sale of the building.
Jules and Katrina are under contract for the purchase of Katrina's house. A dispute arises over some contract terms, and they end up in court. The court rules one of the terms invalid but leaves the remainder of the contract in force. Severability refers to the concept that a court can strike down one or more contract terms while leaving the remainder in place.
A brokerage firm that hires licensees as employees instead of as independent contractors must ______. Advise the state licensing regulators of the non-traditional working relationship Avoid controlling their activities too closely to ensure proper worker classification Offer incentive bonuses to ensure a motivated workforce Pay licensees a regular salary regardless of the revenue they generate
Pay licensees a regular salary regardless of the revenue they generate Brokerages that hire licensees as employees must factor in the expense of a regular payroll, even when the sales volume is low.
Tom and Jim are neighbors. Jim wants to buy Tom's rental property. In the contract they sign, Jim is identified only as "the neighbor." Which statute or contract element does this violate? Legal purpose Offer and acceptance The law of contracts The statute of frauds
The statute of frauds The statute of frauds requires not only that a contract to convey property be in writing, but also that the contract identify the parties to the contract.
The statute of frauds
The statute of frauds requires not only that a contract to convey property be in writing, but also that the contract identify the parties to the contract.
Novation
The substitution, by agreement, of a new contract for an old one, with the rights under the old one being terminated.
In certain cases, antitrust violators may be subject to court-ordered supervision. How long can this supervision last? 10 years One month One week One year
10 years
A lot measuring three-fourths of an acre is for sale. How many square feet is this? 10,890 14,520 32,670 43,560
32,670
How many sq ft in an acre?
43,560 sq ft
A former client has filed a formal complaint against Ajit, claiming he failed to properly disclose a material fact that the seller didn't disclose. Which of these statements about Ajit's liability is true? Ajit is only responsible for disclosing adverse material facts. Ajit may be liable if he operates in a state that requires licensees to make a reasonable effort to discover adverse material facts. The claim has no base because the seller didn't disclose the information. The claim is likely to be dismissed if Ajit operates in a non-full disclosure state.
Ajit may be liable if he operates in a state that requires licensees to make a reasonable effort to discover adverse material facts. Licensees must follow state laws regarding disclosure of all material facts, but typically there's no distinction between disclosure of material facts or adverse material facts. Ajit may be liable even if the seller didn't disclose the fact, depending on state law.
Tracy is looking in the MLS and sees a listing marked "REO." Which of these statements regarding REOs is correct? An REO property is one that the lender is trying to help the owner sell before beginning foreclosure proceedings. Banks acquire REOs through failed foreclosure sales or deed in lieu of foreclosure actions. REOs are properties that the lender has given permission to sell for less than the loan amount. REOs refer to investment properties a bank owns.
Banks acquire REOs through failed foreclosure sales or deed in lieu of foreclosure actions.
You need to perform a sales comparison for your clients. Comparable A's adjusted sales price is $277,000. Comparable B's adjusted sales price is $255,000. How might you use this data to determine a list price range for the clients' home? Find the average of the adjusted sales prices of Comparable A and Comparable B. Give more weight to the list price on Comparable A, because it's lower. Give more weight to the list price on Comparable B, because the subject property will likely sell more quickly at this higher price. Give more weight to the list price on the comparable that's most similar to the property.
Give more weight to the list price on the comparable that's most similar to the property. When faced with a range of prices, give more weight to the comparable that's most similar to the subject property.
Which of the following describes a right-of-way easement? A dock that a neighbor shares with another for launching his boat A fence that divides two neighbors' properties A recreation area of a condo that anyone can rent out for parties Land that a railroad company runs its track through
Land that a railroad company runs its track through Right-of-way easements allow pass-through and can be as short as a driveway or as long as a railroad track.
Layla, a licensee, has had a few casual meetings with a potential client, Marcus. Marcus has told Layla the type of home and locations he's interested in. Layla has mentioned a few homes that she thinks Marcus might be interested in. Although Layla hasn't said that she will continue to look for homes for Marcus, Marcus believes she'll do just that. Which of these statements about this situation is correct? Because Layla doesn't know if Marcus is working with another agent, she's just inadvertently created a dual agency situation. Because Layla has performed some agency tasks for Marcus, she has an express agency agreement with him. Layla and Marcus have no agency agreement, either express or implied, until Layla begins showing Marcus homes. Layla's actions may have created an implied agency agreement with Marcus.
Layla's actions may have created an implied agency agreement with Marcus. Layla's work with Marcus and Marcus's belief that Layla will continue to help him find the perfect house may have created an implied agency relationship.
The Perfect Home brokerage firm was found guilty of running deceptive ads. The Federal Trade Commission might require all of the following EXCEPT ______. Letters of apology to all affected consumers New ads to correct previous misinformation Notification to consumers about deceptive ad claims Specific disclosures to consumers
Letters of apology to all affected consumers
Tim and Tina Wells bought a home with absolutely beautiful perennial gardens in the back. The plantings were designed to bring birds, bees, and butterflies and to provide color for most of the year. When they did the final walkthrough, they were dismayed to see that many of the shrubs and flowering plants had been removed. They expected these plantings to be considered part of the real property because of the ________.
Method of annexation
Which of these landlord actions would NOT be considered a reasonable accommodation? Allowing assistance animals when there's a "no pets" policy Assigning a parking space close to the building when the general policy is that there is no assigned parking Moving disabled tenants to units near an elevator Permitting transfers to a ground-floor unit
Moving disabled tenants to units near an elevator Allowing a tenant to transfer to a more accessible unit (which is reasonable) is different than forcing a tenant to move to a different unit.
Kendra made an offer on Sam's property. Sam rejected Kendra's offer, but made a counter-offer. Kendra is now considering the counter. What role does Kendra currently have in this scenario? Examiner Executor Offeree Offeror
Offeree
Betty hired a contractor to replace her gutters. Within days, the gutters leaked and flooded her basement. She complained to the contractor, who replaced the gutters again. The next time it rained, the gutters leaked and flooded Betty's basement a second time. Frustrated, Betty decided to file a lawsuit against the contractor in an attempt to recover the money she lost. This is an example of ______. Accepting partial performance Rescinding the contract unilaterally Suing for damages and breach of contract Suing for specific performance
Suing for damages and breach of contract In this example, Betty sued for damages as a means of remedying the breach of contract caused by the contractor's failure to adequately address the repairs.
Betty hired a contractor to replace her gutters. Within days, the gutters leaked and flooded her basement. She complained to the contractor, who replaced the gutters again. The next time it rained, the gutters leaked and flooded Betty's basement a second time. Frustrated, Betty decided to file a lawsuit against the contractor in an attempt to recover the money she lost. This is an example of ______. Accepting partial performance Rescinding the contract unilaterally Suing for damages and breach of contract Suing for specific performance
Suing for damages and breach of contract In this example, Betty sued for damages as a means of remedying the breach of contract caused by the contractor's failure to adequately address the repairs.
Which of these statements accurately describes finance- and housing-related legislation? As a stipulation of the Housing and Community Development Act, lenders must offer reasons when rejecting loan applications and must respond to all applications within 30 days. The Americans with Disabilities Act added familial status and disability (both physical and mental) to the existing protected classes. The Equal Credit Opportunity Act of 1974 required lenders to provide consumers with equal access to credit and prohibited credit discrimination based on just the three protected classes of race, color, or national origin. The Fair Housing Act of 1968 prohibited discrimination in the sale, rental, and financing of housing based on race, color, religion, or national origin.
The Fair Housing Act of 1968 prohibited discrimination in the sale, rental, and financing of housing based on race, color, religion, or national origin. The Fair Housing Act of 1968 made race, color, national origin, and religion protected classes and prohibits housing and housing financing discrimination. The ECOA prohibits discrimination based on any protected class.
Jorge accepted a seller's offer of insurable title. The transaction hasn't reached closing, and a previously unknown title defect has been revealed. What happens now? Jorge has to take steps to remove the defect before he can close. The seller is still required to clear the title defect before closing. The seller may not be required to attempt to clear the defect before closing. The title insurance company is required to cover the title defect.
The seller may not be required to attempt to clear the defect before closing. The seller may not be required to clear the defect before closing; depending on the type of defect (e.g., an easement) it may not impact closing. Other types of defects may require action before closing.
Which of the following terms means the price a property is worth to its owner as currently enjoyed? Appraisal Insured value Investment value Value in use
Value in use Value in use is the value of a property to the person currently using it, rather than to a typical buyer. For example, a family estate with generations of history is likely of more value to those living there than it would be to a new buyer.
Value in use
Value in use is the value of a property to the person currently using it, rather than to a typical buyer. For example, a family estate with generations of history is likely of more value to those living there than it would be to a new buyer.
Lorena and Julio purchased a home for $205,950. Their loan amount was $164,760, and the assessed value is now $201,500. Their tax rate is 0.63%. How much will their monthly taxes be?
$105.79
Sherman, who owns property in a life estate, neglects the property, significantly diminishing its value. This is called ______. A lease option An act of waste An estate at sufferance A possessional prerogative
An act of waste
How many square feet are in an acre?
43,560 square feet
The appraisal on Jean's property came in at $22,000 less than the agreed-upon sales price, so the buyer, Thomas, wants to renegotiate the terms. If they can come up with a new price that is satisfactory to both parties, what will they use to document this? Addendum Amendment Annotation Appendix
A change to an existing sales contract is called an amendment, which changes one or more of the contract's original terms.
When real estate licensee Brian discovered that real estate licensee Arnold was using a "Choose Your Neighbor" letter to market a property without also listing the property in the MLS, in the local paper, or even putting a for sale sign in the yard, what charge could he bring against Arnold to the National Association of REALTORS®? A charge of agreeing to discriminate by limiting access to the property A charge of misrepresenting the property for sale A charge of not fulfilling his fiduciary duties to his client by not conducting a complete marketing plan A charge of unfair practice because his mother did not get one of the "Choose Your Neighbor" letters
A charge of agreeing to discriminate by limiting access to the property REALTOR® Brian could charge Arnold with violating Article 10 of the Code of Ethics, which prohibits REALTORS® from agreeing to discriminate against people belonging to a protected class.
When real estate licensee Brian discovered that real estate licensee Arnold was using a "Choose Your Neighbor" letter to market a property without also listing the property in the MLS, in the local paper, or even putting a for sale sign in the yard, what charge could he bring against Arnold to the National Association of REALTORS®? A charge of agreeing to discriminate by limiting access to the property A charge of misrepresenting the property for sale A charge of not fulfilling his fiduciary duties to his client by not conducting a complete marketing plan A charge of unfair practice because his mother did not get one of the "Choose Your Neighbor" letters
A charge of agreeing to discriminate by limiting access to the property REALTOR® Brian could charge Arnold with violating Article 10 of the Code of Ethics, which prohibits REALTORS® from agreeing to discriminate against people belonging to a protected class.
Reconveyance
A conveyance to the land owner of the title held by a trustee under a deed of trust.
Jerrica is set to close on the property she's buying on Friday. Because of other delays in the closing date, Jerrica's interest rate as of the day of closing will increase by 1/4 of a percent. What impact does this have on the closing? A new Closing Disclosure must be issued at least three days before the closing date. A new Loan Estimate must be issued, so the closing date must be moved back. Jerrica will not be able to close until she re-applies for her loan. The closing date will remain the same, but Jerrica will need to bring additional funds to the closing.
A new Closing Disclosure must be issued at least three days before the closing date. Any interest rate change of more than 1/8 of a percent requires a new Closing Disclosure, triggering a new three-day waiting period.
A former client has filed a formal complaint against Ajit, claiming he failed to properly disclose a material fact that the seller didn't disclose. Which of these statements about Ajit's liability is true? Ajit is only responsible for disclosing adverse material facts. Ajit may be liable if he operates in a state that requires licensees to make a reasonable effort to discover adverse material facts. The claim has no base because the seller didn't disclose the information. The claim is likely to be dismissed if Ajit operates in a non-full disclosure state.
Ajit may be liable if he operates in a state that requires licensees to make a reasonable effort to discover adverse material facts. Licensees must follow state laws regarding disclosure of all material facts, but typically there's no distinction between disclosure of material facts or adverse material facts. Ajit may be liable even if the seller didn't disclose the fact, depending on state law.
Which of these landlord actions would NOT be considered a reasonable accommodation? Allowing assistance animals when there's a "no pets" policy Assigning a parking space close to the building when the general policy is that there is no assigned parking Moving disabled tenants to units near an elevator Permitting transfers to a ground-floor unit
Allowing a tenant to transfer to a more accessible unit (which is reasonable) is different than forcing a tenant to move to a different unit.
The appraisal on Jean's property came in at $22,000 less than the agreed-upon sales price, so the buyer, Thomas, wants to renegotiate the terms. If they can come up with a new price that is satisfactory to both parties, what will they use to document this? Addendum Amendment Annotation Appendix
Amendment A change to an existing sales contract is called an amendment, which changes one or more of the contract's original terms.
Which economic principle states that the value of property today is impacted by the current value of the total expected future benefits? Anticipation Conformity Highest and best use Progression
Anticipation
A new Closing Disclosure must be issued at least three days before the closing date. A new Loan Estimate must be issued, so the closing date must be moved back. Jerrica will not be able to close until she re-applies for her loan. The closing date will remain the same, but Jerrica will need to bring additional funds to the closing.
Any interest rate change of more than 1/8 of a percent requires a new Closing Disclosure, triggering a new three-day waiting period.
Lydia put the minimum 3.5% down on her $210,000 home. She'll have to pay an MIP. What type of loan does Lydia have? Conventional FHA Standard VA
Based on the minimum down payment amount of 3.5% and the fact that she's paying MIP, Lydia has an FHA loan.
Tristan's offer has been signed by all parties and delivered back to the seller. This means that ______ has occurred. Acceptance Binding acceptance Notarization Personal delivery
Binding acceptance Binding acceptance happens when a signed contract is delivered according to the delivery procedures and deadline outlined in the contract.
Tristan's offer has been signed by all parties and delivered back to the seller. This means that ______ has occurred. Acceptance Binding acceptance Notarization Personal delivery
Binding acceptance happens when a signed contract is delivered according to the delivery procedures and deadline outlined in the contract.
Sam's kids talked him into putting up the basketball hoop that their grandparents got them for Christmas. On a quiet Saturday afternoon, Sam is busy nailing the backboard to the front of their garage facing the street when one of the officers of the homeowners association walks by. "I'm so sorry," she says, "but you'll have to take that down. Basketball hoops in direct view of the street are prohibited." What is in place in Sam's subdivision that would prohibit this?
CC&Rs Developers manage the visual and aesthetic details of a given neighborhood through covenants, conditions, and restrictions (CC&Rs).
Margaret has received her Closing Disclosure from the lender. To best protect her interests, what should she do with it? Compare it to the Loan Estimate. File it with her mortgage papers. Take it to the closing. Use the information to compare loan costs with those of other lenders.
Compare it to the Loan Estimate. Margaret should compare the Closing Disclosure figures with those on the Loan Estimate to ensure that no undisclosed changes in loan costs have been made.
CC&R
Conditions, covenants, and restrictions apply to an entire subdivision, while deed restrictions apply to a specifically named property.
Chrissy lives in Lake Ridge Estates, a neighborhood in which vinyl siding may not be used on homes. This HOA regulation is what kind of private land control? CC&R Deed restriction Law Regulation
Conditions, covenants, and restrictions apply to an entire subdivision, while deed restrictions apply to a specifically named property.
Which economic principle says that value is created and maintained when the characteristics of a property fit in with its surroundings? Anticipation Conformity Contribution Substitution
Conformity
Which of the following is an instrument of conveyance? Deed Mortgage Promissory note Title insurance policy
Deed
Which agency enforces Title II under the Americans with Disabilities Act of 1990, when it relates to state and local public housing, housing assistance, and housing referrals? Department of Civil Rights Department of Equal Opportunity Department of Housing and Community Development Department of Housing and Urban Development
Department of Housing and Urban Development
Sam's kids talked him into putting up the basketball hoop that their grandparents got them for Christmas. On a quiet Saturday afternoon, Sam is busy nailing the backboard to the front of their garage facing the street when one of the officers of the homeowners association walks by. "I'm so sorry," she says, "but you'll have to take that down. Basketball hoops in direct view of the street are prohibited." What is in place in Sam's subdivision that would prohibit this? CC&Rs Deed warranty Law Regulation
Developers manage the visual and aesthetic details of a given neighborhood through covenants, conditions, and restrictions (CC&Rs).
What's the role of the mortgage contingency in a sales contract? Describes seller financing options if the buyer isn't pre-qualified for a mortgage. Describes the lender and interest rates the buyer will use when purchasing the property. Documents the seller's credit rating and pre-approved purchase price. Documents the type of and timeline for financing, and outlines what to do if financing falls through.
Documents the type of and timeline for financing, and outlines what to do if financing falls through.
You need to perform a sales comparison for your clients. Comparable A's adjusted sales price is $277,000. Comparable B's adjusted sales price is $255,000. How might you use this data to determine a list price range for the clients' home?
Give more weight to the list price on the comparable that's most similar to the property. When faced with a range of prices, give more weight to the comparable that's most similar to the subject property.
Homestead Realty had a listing agreement with Gertrude. The listing expired, and Gertrude moved the listing to another firm. Another licensee at Homestead Realty has a buyer client who's interested in Gertrude's property. What restrictions are in place for Homestead Realty? Homestead may not represent a buyer for the previously listed property. Homestead may represent the buyer but may not disclose any information about the property or previous offers on it. Homestead may represent the buyer, must disclose material facts about the property, and must maintain Gertrude's confidentiality. No restrictions are in place since the previous property listing expired.
Homestead may represent the buyer, must disclose material facts about the property, and must maintain Gertrude's confidentiality. Homestead must adhere to its fiduciary duties of confidentiality (to Gertrude) and disclosure (to all parties).
Homestead Realty had a listing agreement with Gertrude. The listing expired, and Gertrude moved the listing to another firm. Another licensee at Homestead Realty has a buyer client who's interested in Gertrude's property. What restrictions are in place for Homestead Realty? Homestead may not represent a buyer for the previously listed property. Homestead may represent the buyer but may not disclose any information about the property or previous offers on it. Homestead may represent the buyer, must disclose material facts about the property, and must maintain Gertrude's confidentiality. No restrictions are in place since the previous property listing expired.
Homestead may represent the buyer, must disclose material facts about the property, and must maintain Gertrude's confidentiality. Homestead must adhere to its fiduciary duties of confidentiality (to Gertrude) and disclosure (to all parties).
Which act states that communities and facilities that meet certain criteria for providing housing to older persons are legally exempt from familial status discrimination? Fair Housing Amendments Act of 1988 Federal Fair Housing Act of 1968 Housing and Community Development Act of 1974 Housing for Older Persons Act of 1995
Housing for Older Persons Act of 1995 Under the Housing for Older Persons Act of 1995, housing must have one person who is 55 or older residing in at least 80% of its occupied units to be exempt from charges of familial status discrimination by age preference.
Which act states that communities and facilities that meet certain criteria for providing housing to older persons are legally exempt from familial status discrimination? Fair Housing Amendments Act of 1988 Federal Fair Housing Act of 1968 Housing and Community Development Act of 1974 Housing for Older Persons Act of 1995
Housing for Older Persons Act of 1995 Under the Housing for Older Persons Act of 1995, housing must have one person who is 55 or older residing in at least 80% of its occupied units to be exempt from charges of familial status discrimination by age preference.
Which of these is an example of puffery? Kari's ad boasts that the property is "just blocks from the proposed metro light rail station." Katherine's ad for her newly renovated home states, "New from the studs up." Her carpenter might tell you a different story. Kevin's MLS remarks note that the condo has the city's "most beautiful twilight view of downtown and the bay." Kim notes that the property "overlooks a serene, peaceful green space." It's next to a cemetery. Kevin's ad is the best example of puffery. Katherine's ad is fraudulent, and Kim's is in poor taste but probably true.
Kevin's MLS remarks note that the condo has the city's "most beautiful twilight view of downtown and the bay." Kevin's ad is the best example of puffery. Katherine's ad is fraudulent, and Kim's is in poor taste but probably true.
Which of these is an example of puffery? Kari's ad boasts that the property is "just blocks from the proposed metro light rail station." Katherine's ad for her newly renovated home states, "New from the studs up." Her carpenter might tell you a different story. Kevin's MLS remarks note that the condo has the city's "most beautiful twilight view of downtown and the bay." Kim notes that the property "overlooks a serene, peaceful green space." It's next to a cemetery.
Kevin's ad is the best example of puffery. Katherine's ad is fraudulent, and Kim's is in poor taste but probably true.
Layla, a licensee, has had a few casual meetings with a potential client, Marcus. Marcus has told Layla the type of home and locations he's interested in. Layla has mentioned a few homes that she thinks Marcus might be interested in. Although Layla hasn't said that she will continue to look for homes for Marcus, Marcus believes she'll do just that. Which of these statements about this situation is correct? Because Layla doesn't know if Marcus is working with another agent, she's just inadvertently created a dual agency situation. Because Layla has performed some agency tasks for Marcus, she has an express agency agreement with him. Layla and Marcus have no agency agreement, either express or implied, until Layla begins showing Marcus homes. Layla's actions may have created an implied agency agreement with Marcus.
Layla's actions may have created an implied agency agreement with Marcus. Layla's work with Marcus and Marcus's belief that Layla will continue to help him find the perfect house may have created an implied agency relationship.
When negotiating the purchase of a property that's subject to an existing lease, it's critical for your client to clearly understand the lease terms, including the property management responsibilities, rent amount, renewal/purchase options, and the ______. Lease duration Lease start date Security deposit amount Tenants' phone number
Lease duration, Your client needs to understand the lease duration as well as property management responsibilities, rent amount, and renewal/purchase options.
Margaret has received her Closing Disclosure from the lender. To best protect her interests, what should she do with it? Compare it to the Loan Estimate. File it with her mortgage papers. Take it to the closing. Use the information to compare loan costs with those of other lenders.
Margaret should compare the Closing Disclosure figures with those on the Loan Estimate to ensure that no undisclosed changes in loan costs have been made.
Your buyer client, Percy, wants to start searching for his dream house and knows he needs to obtain financing to accomplish that. What's his first step? Complete a loan application. Obtain a pre-qualification letter. Sign a purchase agreement. Write an offer.
Obtain a pre-qualification letter. Before Percy even begins looking for properties, he should get pre-qualified. He may also consider getting pre-approved.
A brokerage firm that hires licensees as employees instead of as independent contractors must ______. Advise the state licensing regulators of the non-traditional working relationship Avoid controlling their activities too closely to ensure proper worker classification Offer incentive bonuses to ensure a motivated workforce Pay licensees a regular salary regardless of the revenue they generate
Pay licensees a regular salary regardless of the revenue they generate Brokerages that hire licensees as employees must factor in the expense of a regular payroll, even when the sales volume is low.
Whose role is it to develop the comprehensive master plan? City or town council members Mayor Planning board members Tax assessor
Planning board members
Many market conditions impact housing prices. Which of the following is a true statement? High unemployment rates mean there are more available buyers in the market. Inflation increases buying power. Low unemployment rates mean there are fewer available buyers in the market. Reduced consumer confidence makes new buyers wary of purchasing and homeowners hesitant to trade up.
Reduced consumer confidence makes new buyers wary of purchasing and homeowners hesitant to trade up. A wary market means sluggish sales.
Which of these is an example of severability? Jules and Katrina are under contract for the purchase of Katrina's house. A dispute arises over some contract terms, and they end up in court. The court rules one of the terms invalid but leaves the remainder of the contract in force. Mark's contract with Reuben states that either party may sever the contract if any contract term is only partially performed. Misty's lease agreement with Thomas contains a provision that permits her to sever the lease if Thomas doesn't remodel the apartment as promised. Ricardo and Timothy are under contract in the sale of Ricardo's office building. Ricardo's tenant leases gives him the option to sever the lease agreements upon sale of the building.
Severability refers to the concept that a court can strike down one or more contract terms while leaving the remainder in place.
Katherine is purchasing a second home as an investment/vacation property. She has a large down payment, and the seller is financing the rest of the purchase. Which of these statements is true? The CFPB provides forms similar to the Closing Disclosure and Loan Estimate for seller/financers to use. The Closing Disclosure and Loan Estimate aren't required in a seller-financed transaction. The seller is required to provide the same disclosure forms to Katherine as a standard lender would provide. The seller will provide the Closing Disclosure and Loan Estimate to Katherine but has a longer timeframe to do so than a traditional lender would have.
The Closing Disclosure and Loan Estimate aren't required in a seller-financed transaction. In a seller-financed transaction, the Closing Disclosure and Loan Estimate aren't required. Some other form of statement may be prepared to show the buyer and the seller their respective closing figures.
Katherine is purchasing a second home as an investment/vacation property. She has a large down payment, and the seller is financing the rest of the purchase. Which of these statements is true? The CFPB provides forms similar to the Closing Disclosure and Loan Estimate for seller/financers to use. The Closing Disclosure and Loan Estimate aren't required in a seller-financed transaction. The seller is required to provide the same disclosure forms to Katherine as a standard lender would provide. The seller will provide the Closing Disclosure and Loan Estimate to Katherine but has a longer timeframe to do so than a traditional lender would have.
The Closing Disclosure and Loan Estimate aren't required in a seller-financed transaction. In a seller-financed transaction, the Closing Disclosure and Loan Estimate aren't required. Some other form of statement may be prepared to show the buyer and the seller their respective closing figures.
Which of these statements accurately describes finance- and housing-related legislation? As a stipulation of the Housing and Community Development Act, lenders must offer reasons when rejecting loan applications and must respond to all applications within 30 days. The Americans with Disabilities Act added familial status and disability (both physical and mental) to the existing protected classes. The Equal Credit Opportunity Act of 1974 required lenders to provide consumers with equal access to credit and prohibited credit discrimination based on just the three protected classes of race, color, or national origin. The Fair Housing Act of 1968 prohibited discrimination in the sale, rental, and financing of housing based on race, color, religion, or national origin.
The Fair Housing Act of 1968 prohibited discrimination in the sale, rental, and financing of housing based on race, color, religion, or national origin. The Fair Housing Act of 1968 made race, color, national origin, and religion protected classes and prohibits housing and housing financing discrimination. The ECOA prohibits discrimination based on any protected class.
Which mortgage clause requires the lender to discharge the mortgage lien once the borrower has paid in full? Acceleration Alienation Defeasance Due-on-sale
The defeasance clause means that the lender is prevented from trying to pursue additional payment because the loan has been paid in full.
Tim and Tina Wells bought a home with absolutely beautiful perennial gardens in the back. The plantings were designed to bring birds, bees, and butterflies and to provide color for most of the year. When they did the final walkthrough, they were dismayed to see that many of the shrubs and flowering plants had been removed. They expected these plantings to be considered part of the real property because of the ________. Adaptation to the land Agreement of the parties Intention in placing the item Method of annexation
The method of annexation—planting in the ground—implies that the plantings were expected to stay with the land.
Alison and Brent are financing their house purchase of $232,500 with an FHA loan. Their credit score qualifies them for the minimum down payment. What do they need to put down?
The minimum down payment for an FHA loan is 3.5%, so Alison and Brent's down payment needs to be $8,137.50 ($232,500 x 0.035).
Real estate professionals handle many documents related to real estate transactions. Which one of the items listed below is one of the most important in detecting mortgage fraud? Agency disclosures Buyer representation agreement The original sales agreement and any addenda The title
The original sales agreement and any addenda to that agreement must be accurate. They should clearly identify the property and all parties to the transaction.
Lance is a property manager who receives his management fees on a bi-monthly basis. He draws them from a trust account set up in the property owner's name. What gives him the authority to take these disbursements as his fee? The authorization statement filed with the bank The exclusive agency agreement The property management agreement The property management proposal
The property management agreement
Jorge accepted a seller's offer of insurable title. The transaction hasn't reached closing, and a previously unknown title defect has been revealed. What happens now? Jorge has to take steps to remove the defect before he can close. The seller is still required to clear the title defect before closing. The seller may not be required to attempt to clear the defect before closing. The title insurance company is required to cover the title defect.
The seller may not be required to clear the defect before closing; depending on the type of defect (e.g., an easement) it may not impact closing. Other types of defects may require action before closing.
Sue Ellen has a contract to buy Roger's house, which she has always admired, when Roger decides he's ready to move to a senior living community. After Roger finds a suitable senior apartment and moves, Sue Ellen writes a check for the agreed-upon amount, and Roger transfers the deed to her. What is happening in this scenario? Assignment Breach Novation Performance
This is an example of contract performance. Performance means that the two parties have met the terms of the contract.
When negotiating the purchase of a property that's subject to an existing lease, it's critical for your client to clearly understand the lease terms, including the property management responsibilities, rent amount, renewal/purchase options, and the ______. Lease duration Lease start date Security deposit amount Tenants' phone number
Your client needs to understand the lease duration as well as property management responsibilities, rent amount, and renewal/purchase options
