Real Estate Test 1

Elvira was afraid that her nephews, Elmo and Elmer, might make a claim on her property. Which of the following actions would be the best approach for Elvira to take a resolve this problem?

File an action to quiet title

Which of the following is NOT an economic characteristic of land?

Immobility

Desmond of Diogenes Realty has a signed buyer's representation agreement with Seraphina. To which parties described here does he owe disclosure of the fact that he represents Seraphina?

The seller's agent

A seller's disclosure must, at minimum, provide

The seller's disclosure completed honestly and to the best of the seller's knowledge

Desmond just sold the house he has lived in for the past 19 years and 3 months. He brought it with a $329,000 loan on a 30 year fixed rate of 3,75%. He just sold it for $449,900. At closing, his prorated and negotiated share of closing cost comes to $1,283. How much money should Desmond receive at closing?

$261,920

Desmond's property was assessed at $295,900, appraised at $315,500 list at $329,000 and sold for $319,900. What is the market price of Desmond's home?

$319,900

Compensation for property management paid from the general account must be withdrawn within how many days after it is earned?

10

The commission may suspend or revoke a license or take disciplinary authorized action if the license holder.

Acts negligently or incompetently

Normally, a revised loan estimate can only be issued because the lender discovers which of the following?

An unforeseen change of borrower circumstances.

Which of the following lists consists exclusively of the most common items that are deemed environmental hazard to the house?

Asbestos, Randon, Lead, and mold

The concept that not two pieces of real property are the same is referred to as which of these?

Nonhomogenity

Which of he following lists represents the duties properly performed by an unlicensed assistant?

Scheduling appointments , filing and maintaining records, placing signs and other similar forms of advertising

A townhouse and condominium are distinguished in which of these ways?

The townhouse complex HOA none of the building or the land under it.

Elvira leased her property to her nephew Elmo to live on so long as he continues the family farming business and does not attempt to initiate any other businesses on the property. Which combination of the "bundle of rights" has she conveyed to him?

possession, enjoyment, and exclusion

A true north and south line used for survey control which runs through an arbitrary point that is chosen as a starting point for laying out sections of land within a given area is called which of these?

principal meridian

Under the Federal Housing Administration's (FHA) standards, a home with a status IE would apply to which of these options?

the home is not insurable as is, but may brought within insurable status with minor repairs.

A licensee may have their license suspended or revoked for failing to deposit earnest or other trust money from a client within which of these deadlines?

3 business days

Which of the following properties would be subject to all standard fair housing laws?

A multi-family apartment complex

In Texas, the mortgage lender holds which of the following interest in the home being mortgaged?

Actual title to the property

Which of the following terms is most likely to be of particulare inetest of a real estate investor

Adjusted Base and boot

A standard subsection of a section in a township is called what kind of "part"?

Aliquot

The most important of these advertising regulations for real estate sales agents in which of the following?

All advertising must be approved by the Supervising broker

Encumbrances on a property are best described by which of these terms.

CCRS, Deed restrictions easements licenses and encroachments

$5,488 Elvira purchased a $325,000 home through FHA. The loan was financed at 96.5% of loan to value (which is the same as the purchase price) with an upfront mortgage insurance premium (UFMIP) of 1.75% of the loan. How much is the UFMIP? (Choose closest rounded number)

$5,488

Nonresidential real property encompasses things such as warehouses, office buildings, storefronts and other properties that are not residential and are expected to have a usable life (the amount of time a property will be used as part of a business enterprise) of more than which of the following?

20 years

Desmond's 4-unit complex brings in an average of $1,250 per unit per month. The property is valued at $625,000. What is the gross multiplier (GIM) for this property?

10.4

Property managers/management companies must keep records how long after the transaction for which the record was made is terminated?

3 years

Under TREC regulations, the prohibition of referral fees and rebates without prior approval from The client does NOT apply to which of the following?

? Compensation from settlement companies

The four components of the National Flood Insurance Program (NFIP) are best described by which of these summaries?

? Risk identification assessment; risk mitigation; regulations that communities must comply with insurance subsidization and (and attrition)

Which of these list BEST represents the most common methods for termination of easements?

? The properties came under ownership of same party, oral release, abandonment declaration of the servient property

A borrower on a mortgage for $250,000 on 30 year 5% interest rate pays 1% per point for a 4 points each lowering the interest rate by .25% will take how long to make up the difference paid for those points based on their monthly payment savings?

??

Which of these options best describes the role function of transfer taxes?

?They are taxes levied by the local government when property is transferred from one person to another and generally are pad by the seller of the property.

Which of the following agreements is NOT required to be in writing?

A month to month rental

Which of these options best describes a "Broker's Price Opinion?"

A more formal and concise version of a CMA

Armand is selling his home to Ameche. The home was built in 1977. It is located on the seaward side of the Gulf intracoastal Waterway, is not part of an HOA and there is no propane gas service in the area. Which of these is NOT a disclosure that Armand MUST provide to Ameche?

A disclaimer acknowledging that there is no homeowners association

A broker can only pay a commission or a fee to or divide a commission or a fee with which of thee parties?

A former license holder from the same firm so long as their license was not revoked.

A broker can only pay a commission or a fee to or divide a commission or a fee with which of these parties?

A former license holder from the same firm so long as their license was not revoked.

When a loan is not a federally-related mortgage loan but is still subject to the TILA-RESPA rule what alternatives to the H-24 (Loan Estimate) can the lender provide?

A loan estimate that has the same headings content, and format as form H-24.

A "marketable title" is BEST described by which of these?

A property title that is considered free from defect and therefore the possibility of litigation is eliminated although there may still be encumbrances of the title but it is one of which the parties are aware such as a lien or an easement.

Which of the following situations is most likely to lead to the use of a broker as an intermidiary?

A prospective buyer attended an open house for one Diognes Reality's listing and requested that the Realty assist them in making an offer on the home.

In an open listing, the commission goes to the broker who produces

A ready, willing and able buyer

A reservation deposit made by a tenant/prospective tenant is considered to be which of these?

A refundable charge that a tenant pays in order to be placed on a waiting list.

Which of the following is required to be in writing under the Texas statute of frauds?

A two-year option agreement

A "time of the essence" designation in a sales agreement can make the difference between timing being which of these?

A void or voidable contract

HIV patients are part of a protected class created by which of these acts or laws?

Americans with Disabilities Act (ADA)

The liquidation value of property is which of these?

An estimate of the amount of money that could be gained if the property was quickly sold in low-demand market

The seller must deliver the Notice of Membership in a Property Owners Association to the buyer by which of the following deadlines? (Best Answer)

Before the effective date of the contract

Some lenders in Texas will recommend that a sales agreement not use a Non-Realty Items, Addendum, but rather to handle personal property through a

Bill of sale

The Comprehensive Environmental Response Compensation and Liability Act which passed in 1980 in otherwise known as CERCLA or which of the following?

Clean -up Fund

Which of these lists represents the most common forms of damages that can be awarded by the courts?

Compensatory, liquidated and punitive

What is the relationship between a supervised sales agent and a listing client for their brokerage

Customer-agent

Angelina owns numerous properties that she sells, rents, and leases. Which of following agreements would NOT be required to be in writing under the Statutes of Frauds?

Displaced from his retail space while it is being remodeled, Arturo and Angelina agreed to a nine-month lease for Arturo to use in the interim.

Which of these sets of criteria BEST represents the basic elements of a sales comparison approach (aka market comparison approach?

Date of sale, location physical features, terms and conditions of the sale.

Failure by a seller of real property to disclose material adverse conditions and defects is a violation of the

Deceptive Trade Practice Act

The Fair Housing Act is enforced by the Office of Fair Housing and Equal Opportunity, which is part of which of these government agencies?

Department of Housing and Urban Development (HUD)

Which of the following statements accurately reflects current Texas law regarding dual agency?

Dual agency is illegal in Texas and has been replaced by the intermediary relationship.

Which of the following agreements is a unilateral agreement?

Elvira offered Desmond $175,000 for his home including putting $1000 down upon acceptance.

Desmond of Diogenes realty met with four people today Elvira signed a listing agreement with him: Arturo called him for information on a rental through the realty. Elmo delivered an earnest money check for an offer Desmond made for him and Seraphina signed a broker representation agreement with him. Which of the following groups represents all of Desmond's clients versus customers, and ONLY clients?

Elvira, Elmo and Serephina

A party who has possession and control of real property that they are purchasing but do not yet hold actual title is said to hold what kind of title?

Equitable

The most commonly used listing agreement in Texas is which of the following?

Exclusive right-to-sell

Seraphina is purchasing Desmond's property on a land sales contract in which she will pay him $1790 per month for 20 years at which point title will be conveyed to her. What types of contract BEST describe their agreement?

Executory and express

A real estate licensee owes ALL parties at least the minimum duties of which of these following sets of choices?

Fair and honest dealing and providing accurate information

Generally "improvements" on a property for the purposes of valuation refer specifically to items such as which of the following lists?

HVACS, roofs, and foundations

Which of these sets of names would be in the best format for use on the residential sales contract?

Helen H. Homeowner, a single individual (Seller), Ms. Belle B. Buyer and spouse, William B. Buyer (Buyer)

Article I of the National Association of Realtors commits all realtors to treat all parties in which of these manners?

Honestly

A lender just denied a loan based on a credit reporting agency's negative decision. What are they required to do now?

Inform the consumer of the action

Desmond is holding an open house for his new listing. Elvira, an unrepresented buyer, likes the home, is pre-qualified, and wants Desmond to represent her. If all parties agree, which of these agency relationships would they need to use?

Intermediary agency

Which of the following statements regarding "net listings" is accurate?

It is the most advantageous to the salesperson because it allows an uncapped potential commission.

Which of these lists of services BEST describe those provided by the Texas Veterans Land Board?

Loans, Land Sales, Long-term Care, and Cemetery Services

Which of the following statements most accurately describes Texas fair housing laws?

Local jurisdictions are allowed to have more stringent protections but may not make laws or rules that are less protective

Which of these lists BEST describes the advantages of a land sale contract (aka, contract for deed, installment sales contract)to the buyer?

May be the only way that a buyer can purchase bare land without paying the full price in cash up front avoids costs of a traditional mortgage may be the best option for buyers with poor credit histories or difficult to document incomes simplified paperwork.

Which of these lists BEST summarizes the most common primary expense areas for property management?

Mortgage, maintenance, employees, taxes and insurance.

A "short sale" is so named because the sale will

Not cover the full balance owed on the mortgage

In addition to prohibitions against certain discriminatory acts, other lender requirements of the Equal Credit Opportunity Act (ECOA) are BEST described by which of these options?

Notify applications of actions on their applications report credit history of at least one spouse on an account, collect personal demographic information about applicant's in certain dwelling-related loans and provide applicants with copies of appraisal reports used.

In Texas, the statute of frauds does not apply to which of the following?

Offers

Desmond is new to Texas sales and wants to know which contract to use for his client buying a duplex on a one acre lot. Which does he pick?

One to Four Family Residential Contract

Which of the following actions by a supervising broker would be acceptable under Texas law?

Permitting sales agents to act outside of their written directive of authorized activities.

Determining the highest and best use of a property generally calls for which of these four sets for criteria?

Physically possible, legally permissible, financial feesible

The Clean Water Act and the Clean Air Act address issues of industrial and/or personal contamination of air and water sources and supplies, including which of the following?

Prevention, correction, abatement, and mitigation

Which of the following is NOT an acceptable advertisement for a rental property under fair housing laws?

Quiet community for single professionals with strong English language skills

Which of these groups or activities is generally exempted from the telemarketers "Do Not Call" list?

Real Estate Agents

The "non-fiduciary" duties owed to all parties to a transaction are best described by which of these lists of duties?

Reasonable care and skill, honest and fair dealings, and disclosure of known material facts about the property.

The mortgage clause that allows a borrower to separate and alienate a portion of a mortgaged property is which of these?

Severance clause

The National Association of Realtors offers a certification known as SFR for which of the following function?

Short sales and foreclosures

Desmond of Diogenes Realty received a call from Serephina to get basic information on one of his listings but no more. She showed up at the agency the next day to meet Desmond and seek his services. Desmond's next move is?

Sign Seraphina to a broker representation agreement

The purpose of the antitrust laws is BEST described by which of these?

Simply to prevent monopolies from forming

"Severance" of items previously attached to real property generally applies to which of these lists of items or features?

Spas, above ground pools and water features

Under what specific authority may the commission compel both the attendance of witnesses for examination under oath and the production for inspection and copying of records, documents, and other evidence relevant to investigation of an alleged violation? (Best Answer)

Subpoena authority

Ameche and Arman have a written sales agreement for Ameche to purchase Armand's home at an agreed price so long as Armand replaces several windows, but is waiting on two screens to complete the process. When Ameche balks at paying at closing, Armand goes to court. Which contract legal concept can he base his argument?

Substantial perforamnce

Which of the following is NOT one of the common Texas addenda forms?

Substitution of Real Estate Agent

The Comprehensive Environmental Response, Compensation, and Liability Act was updated in 1986 by which of these?

Superfund Amendments and Reauthorization Act (SARA)

A property manger generally establishes rental rates by which of the following sets of steps?

Surveying local rental rates calculating overhead costs depreciation taxes, and profit goals.

____________is the primary environmental agency for Texas and has multiple purposes, including enforcing federal legislation on the state level.

Texas Commission on Environmental Quality (TCEQ)

Which combination accurately summarizes the advantages of he Back-Up Addendum for the back-up buyer and the seller?

The buyer steps right in without competition and the sell already has a back-up in place if the first buyers fall through

The requirement in terms of language for a voluntary alienation of real property is which of the following?

The intent to convey must be clear

A lien is considered to be "perfected" when which of these occurs?

The lien has been recorded with the appropriate local jurisdiction.

Which document in the real estate transaction is the actual commitment to repay the loan?

The promissory note

The order in which to respond to counteroffers is determined by which of the following?

The order in which they were received?

The homestead exemption right can only be waived under which of the following circumstances?

The right can not be waived

In which of the following circumstances is an existing survey most likely to be viewed by a court as sufficient for a specific sales transaction?

The seller signs a sworn affidavit of its authenticity

In the process of negotiating an employment, buyer's representation, or listing agreement, who does the licensee represent until the agreement is signed.

Them self or their brokage?

An individual licensed as a real estate broker/salesperson outside of Texas may be paid a referral fee or other compensation from a transaction only in which of the following circumstances?

They can legitimately claim procuring cause for the transaction

The commission may not adopt a rule restricting advertising or competitive bidding by a person regulated by the commission except for which of the following reasons?

To prohibit a false, misleading, or deceptive practice

Under what circumstances can a licensed Texas broker pay a portion of a commission or pay a fee to an individual not licensed to engage in real estate activities in Texas?

When they are licensed in another state and played a significant role in the negotiation of the transaction for which they are being compensated.

Which of the following circumstances does NOT require "privity of contact to allow one party to sue another?

Where one party is new to an existing covenant on land, eg homeowner CCRS.

Which two of the fiduciary duties can survive beyond termination/completion of the agency relationship?

confidentiality and accounting

The primary difference between fraud and misrepresentation is:

intent

The term "tax shelter" describes any tax-deductible expense generated by an investment property which generally include things such as which of the following? (Choose most complete answer)

maintenance costs, insurance or mortgage interest payments property taxes and depreciation

In a Texas warranty deed, the implied warranty that provides confirmation that the seller has the full rights to sell the property is called the "Covenant"

of seisen

A "state licensed real estate appraiser" is authorized to appraise all of these, EXCEPT

subdivisions