Real Estate License Exam Review 2

Who or what entity has legal title to a financed property in a lien theory state?

The borrower

The term "ad valorem" is Latin for ______.

"According to value"

Giant Industries has a $674,232 gross operating income, operating expenses of $329,129, and other expenses totaling $38,719. What is the net operating income?

$345,103 | $674,232 - $329,129 = $345,103. Other expenses like loan interest and debt repayment aren't included in this calculation.

What is the highest amount you can be fined by the Department of Business and Professional Regulation for a serious violation?

$5,000

In Florida, what is the amount of the homestead exemption available for non-school taxes?

$50,000

The Real Estate Professional Practice Act was created by the Florida legislature to establish the...

...legal rights and responsibilities of real estate licensees

A licensee shall not accept compensation from more than one party to a transaction without...

...the full knowledge and consent of all parties

What's the interest rate on a $14,000 loan that requires a semi-annual interest payment of $550? Round to the nearest percent.

8% | Multiple the semi-annual interest amount by two to get the annual interest. Next, divide the annual interest amount by the loan amount to get the interest rate.

Someone who's been given the authority to act on behalf of someone else is a(n) ______.

Agent

Which of the following is studied when creating a comprehensive plan?

Area economic base

To calculate property taxes, multiply the ______ by the tax rate.

Assessed value

Marci obtained a mortgage from her credit union to purchase a new home. The credit union later sold the mortgage to Fannie Mae. What legal document best describes what happened?

Assignment of mortgage

One area of town has maximum building height requirements and setbacks for the front, side, and rear yards. These requirements are all indicative of ______.

Bulk zoning

How may a sales associate receive a commission check directly?

By obtaining written authorization from their broker for each transaction

Which act was created to safeguard the consumer in the use of credit by requiring full disclosure of the terms and conditions of that credit?

Consumer Credit Protection Act

The _______________________ can assign a fine up to $5,000 for serious violations.

Department of Business and Professional Regulation (DBPR)

___________________ and other ___________________ must be retained for five years after the close of the transaction. If a lawsuit arises out of a transaction, an additional _____________ may apply to retaining those records.

Disclosure documents, brokerage records, two years

What's an up front charge to make up for the difference between the interest rate the borrower is paying and the rate the lender normally requires?

Discount point

Eloise is interested in buying a bungalow on the outskirts of the city. Her agent is reviewing the property details and informs her that there are several easements on the property. In particular, the gas company has a right of way because the natural gas line for the neighborhood runs through the back of the lot. What type of easement would this be?

Easement in gross

James Sawyer evicted his tenant, Kate Abbot, for nonpayment. However, she didn't vacate the apartment after the required 72 hours and has yet to move out. This is an example of a(n) ______.

Estate at sufferance

The ________________________ determines penalty severity based on violation severity. Penalties range from a cease-and-desist order to corrective advertising, civil penalties, consumer and other monetary remedies, and informational remedies.

Federal Trade Commission

What is the least amount of time disclosure documents must be retained after the close of a transaction?

Five years

Which type of appraisal report makes use of pre-printed documents?

Form report

How does the Federal Housing Finance Agency affect mortgages?

It sets limits for conforming loans and controls the amount of money that lower-income people can borrow.

Susan Duffield died testate at age 49. What can be said about Susan's estate?

It will be put through probate.

Which of the following is a specific fiduciary duty that agents owe in Florida? Accounting for funds Honesty Loyalty Reasonable skill

Loyalty

Sunshine Surveyors Inc. created a lot and block survey for a new residential development, Happy Acres. The first thing the surveyor did when he surveyed the new neighborhood was to reference what type of description?

Metes and bounds description

Darrel loves working in the mortgage lending industry. On a daily basis, he works with multiple lenders to find and negotiate the best deals for his customers. What is Darrel's profession?

Mortgage broker

Alison has disclosed, in writing, that she has no brokerage relationship with Zsa Zsa, who is selling her home to her daughter and needs assistance with the sales contract. What type of relationship has Alison established?

Non-representation

Your buyer clients Donna and Mike are submitting an offer on a home where the seller is moving to another state and wants to expedite the closing process. What would be a good strategy for structuring an offer in this case?

Offer a quick close.

You've just learned that your buyer, Kirk, can't obtain a qualified mortgage for his dream home because his debt-to-income ratio would be above the threshold. What is Kirk's best option?

Pay off his other debt and/or increase monthly income.

A new development is going up just outside city limits where the population is expected to grow significantly in the next decade. The development will consist of commercial properties in one quadrant near a main road. The other areas are designated residential and will include single-family residences and multi-family townhomes. A small number of the single-family homes will border a golf course that is at the center of the development. What type of zoning is this an example of?

Planned unit development

Sandra enters a contract to sell her home to Paul. Under the statute of frauds, the written contract must name the contracting parties, identify the subject matter of the contract, and ________.

Present the essential terms and conditions of the contract

Kurt is pricing a home for a client in a cold market. It's a great property, and he knows it would sell for above market value if the market were better. All things considered, what's the best pricing strategy for the home?

Price the home below market value.

Roger has a sufficient income, has never missed a loan or credit payment, and has an adequate credit history. His credit score makes him a very creditworthy consumer. When obtaining a loan, which rate will he most likely get?

Prime rate

Chapter 475 of the Florida statutes, called the ______, sets forth the law regarding real estate brokers, sales associates, and real estate schools.

Real Estate Professional Practice Act

Drew and Hank were camping at Hank's riverfront cabin. Hank told Drew that he rarely used the cabin and was thinking of selling it. Drew said that he'd buy it from Hank for $80,000, which Hank agreed was a fair price. It's two months later, and Hank is upset that Drew now says he won't buy it. Why isn't this contract enforceable?

Real estate contracts must be in writing.

The right to access rivers, streams, and other flowing bodies of water adjacent to a property is called ______.

Riparian

Which of the following is provided at the time of a buyer's offer and shows what the seller's proceeds will be if the seller accepts the offer?

Seller net sheet

Loans made to high-risk borrowers, at higher interest rates and with higher fees, are ______.

Subprime loans

In Florida, unless they specify otherwise, a married couple that purchases property does so as tenants by the entirety. If the couple divorces, they become ______.

Tenants in common

Which agency applies the "target" designation to a dwelling and has set specific requirements for lead abatement and remodeling of these homes?

The EPA

In Florida, the FDEP maintains a list of contaminants and their Total Maximum Daily Load (TMDL) contaminant level. Where is this information available?

The FDEP website

A license fee may be collected to fund what?

The Real Estate Recovery Fund

What information regarding the earnest money deposit does Florida law require on a purchase contract?

The name and address of the escrow agent

Which of the following describes the federal funds rate?

The rate at which a bank can obtain a loan from another bank

Who usually pays Florida's documentary stamp tax on deeds?

The seller

What does the parol evidence rule say about contracts?

The terms agreed to in a written contract are the only terms relating to that contract.

Why are residential properties popular with investors?

They're always in demand.

What term refers to the dimensions, physical features, and contours of the land?

Topography

What's the capitalization formula used in the income approach?

Value = net operating income divided by cap rate

If a seller is concerned about an appraisal, what can a buyer do to address this need when structuring the offer?

Waive the appraisal.

What legal document must be delivered to the sheriff before a tenant may be forcibly removed from a rental?

Writ of possession

The term ___________, though often used to refer to a ____________________, means someone who's been given the authority to act on someone else's behalf in some capacity.

agent, real estate licensee

An ____________________ is granted to a specific individual or company.

easement in gross

To comply with the statute of frauds, an option contract must be ______.

in writing and signed by the optionor

The lot and block system always begins with one of two types of land descriptions as a reference point: either a _________________________ or an ______________________.

metes and bounds description, rectangular government survey system (RGSS) description

All _________________ banks must be part of the Fed.

national

(homestead exemption) Homeowners can exempt $25,000 from _______________ and $50,000 from ________________.

school taxes, non-school taxes

For advertising violation penalties, the Federal Trade Commission determines the severity of the penalty based on the _____________________.

severity of the violation

To comply with the __________________, an option contract must be in writing and signed by the optionor (seller).

statute of frauds

The form report makes use of a pre-printed appraisal form with a checklist for describing and rating the property and its characteristics. This form is also called a _______________.

summary report

When a tenant refuses to vacate the premises after being lawfully evicted, the judge may issue a _________________, which the _______________ must then deliver to the sheriff.

writ of possession, landlord