1201- Principles I

how many square miles are there in a section

1

To be legally competent, a person must reach the age of

18 or majority

John and Jay are brothers who received title to a property from their father. When they decided to sell the property, Jay was out of town. In order to properly transfer title, the deed could be signed by

John, with a properly recorded power of attorney from Jay.

As measured from north, an angular bearing of 135 degrees would be equivalent to?

S 45 degrees E

TRUE or FALSE An easement appurtenant may NOT be terminated unilaterally by the holder of the servient tenement.

TRUE

A meeting of the minds creating enforceable rights is called

a contract

A tenant at sufferance is

a legal tenant

A mortgagee in a lien theory state holds legal title. a note. naked title. naked legal title.

a note

Which entity would be most likely to hold an easement in gross?

a power company

The broker has the power to sign documents for the principal. This is probably because she holds

a power of attorney

onstitute an encumbrance on the fee simple title to real property

a restrictive covenant in the deed to the property. a mortgage. a lease.

A woman allowed her neighbor to drive over her property to get to his own. The woman may have given her neighbor

a right of way

The right of an owner to use water from a stream for his own use is called

a riparian right

A beneficiary allows a clause in his contract stating that another lender's interest will be allowed to take precedence over his at some later date. This clause is known as a subrogation clause. a rogata clause. a subordination clause. hypothecation.

a subordination clause

In some states, a mortgage is considered to be a lien on real property. In other states a mortgage is interpreted as a bona fide purchase. a transfer of title. a sales contract. equitable title.

a transfer of title

When one party to a contract makes a promise without first receiving any promise of performance from the other, it is called

a unilateral contract

When a borrower gets behind on his loan payments, the lender could call for the entire balance due immediately based on the alienation clause. acceleration clause. subordination clause. pre-payment clause.

acceleration clause

An offeree who wishes to bind the offeror to the contract may do which of the following with an offer?

accept it

Which of the following is an essential element of a contract? A counter offer Acceptance Performance A fair price

acceptance

A real estate broker could most likely be held liable to a buyer if the broker

acts in excess of the authority given to him by the seller under a listing agreement.

The system under which individuals are given the right to own land is known as the

allodial system

Property taxes are characteristic of the

allodial system of land ownership.

Forty-three thousand, five hundred and sixty is the number of square feet in

an acre

A power company wants to lay a service line across customer properties and must acquire an irrevocable right to do so. This right would be called

an easement in a gross

An example of an encumbrance would be

an easement in gross

All of the following are real estate contracts

an exclusive right to sell listing sales agreement a lease

A judgment, when properly recorded, becomes a voluntary lien. an involuntary lien. a specific lien. a personal lien.

an involuntary lien

a chattel is

an item of personal property

what are emblements

annual cultivated crops care called emblements or fructus industriales, most courts of law regard them as personal property.

Easements, rights-of-way and condominium parking stalls are examples of

appurtenances

A property is sold and the buyer promises the seller in writing that he, the buyer, will repay the existing loan. This is called assuming the loan. buying down the loan. loan satisfaction. a partial release.

assuming the loan

Unless the landlord or tenant acts to terminate it, an estate from period-to-period

automatically renews itself. continues for an indefinite time.

East-west lines in the government rectangular survey system are known as

base lines

If an owner of a single-family residence defaults on his mortgage, it can not be foreclosed if an ALTA title insurance policy insured it. be foreclosed on. not be foreclosed on if the mortgage went into effect before 1978. only be foreclosed on if an ALTA title insurance policy insured it.

be foreclosed on

The seller decided that he didn't want to sell his house a few days before closing. He can simply not show up to sign the deed. return the earnest money deposit and declare the contract void. be sued by the buyer for specific performance and damages. can refuse to pay the broker a commission.

be sued by the buyer for specific performance and damages

A valid enforceable sales agreement must contain the grantor and grantee's signatures. be accompanied by an earnest money deposit. be written and delivered. be written and mailed.

be written and delivered

A contract that results when a promise is exchanged for a promise is called

bilateral

a lease is an example of a blank contract

bilateral

An earnest money agreement signed by all parties is binding on the seller. a binding contract on the seller only if it is full price and the terms of the listing agreement are met. revocable by the buyer for 72 hours. only binding on the buyer.

binding on the seller

Who benefits the most by the inclusion of a subordination clause in a mortgage? Borrower Lender Selling broker Trustee

borrower

Which of the following are examples of specific liens? Mechanic's liens Judgment liens Ad valorem tax liens Federal income tax liens Both A and C

both a and c

In a brokered real estate transaction, the amount of earnest money is determined by the buyer. seller. by agreement between the buyer and seller. by agreement between the buyer and broker.

by agreement between the buyer and seller

An easement appurtenant may be terminated

by merger of the dominant and servient estates

Developers avoid land locked properties by creating an easement

by necessity

Mrs. Coffee has a life estate for the duration of her own life. She can devise it. cannot lease it cannot sell it. can sell the mineral rights.

call sell the mineral rights

An easement by necessity An easement by prescription

can be created without a written document

When a seller wishes to convey title by means of a statutory deed form, the salesperson can advise the seller which deed form to use. can help the seller fill in the blanks. can advise the buyer which tenancy to use. can fill it out for the buyer.

can help the seller fill in the blanks

An option to purchase real property is NOT a contract. covered by the statute of frauds. covered by real property laws. cancelable by the optionor.

cancelable by the optionor

The term "rescinded" in real estate means

canceled

In the U.S. public land survey system, each 24-by-24 mile area created by the guide meridians and correction lines is called a

check

A real estate licensee may advise sellers or buyers regarding which of the following? Which deed form to use How to take title Tax implications on the sale or purchase Choices of financing for the transaction

choices of financing for the transaction

By what action does the government take property for public use?

condemnation

by what action does the government take property for public use

condemnation

An easement by prescription may be created by

continuous use

An executory contract is a

contract in which cetain things are still to be done

If a contract of sale is subject to the buyer's ability to secure a loan, and after diligent effort the buyer is unable to do so by the stated deadline, the contract would become void. contract would be voidable by the seller only. buyer must be allowed additional time to meet the condition. contract would be voidable by the buyer.

contract would be voidable by the buyer

The point, line, or surface from which vertical height or depth is measured in a vertical land description is called a

datum

A mortgage or trust deed is considered to be an estate in land. a promissory note. chattel. debt security.

debt security

A mortgagor signs a deed conveying title to the mortgagee, leaving the mortgagee without recourse. This is an example of

deed in lieu of foreclosure

If a foreclosed property has sold for less than the loan amount, the difference between the indebtedness and the sale price of the real estate at the foreclosure sale is called the net price. deficit. net market value. deficiency.

deficiency

When a clause in a mortgage allows the lender to proceed against a borrower's other assets if the foreclosure sale does not satisfy the debt, the result is called a statutory redemption. deficiency judgment. equity of redemption. foreclosure redemption.

deficiency judgment

The printed portions of a standard residential sales contract refer to all the following EXCEPT title insurance. liens. discount rates. closing date.

discount rates

Howard signed an option with Paula giving Paula the "right to purchase" in 90 days. Paula decided she did not want the property and did not exercise her option. Howard can sue for specific performance. sue for damages. sue for specific performance and damages. do nothing.

do nothing

Which of the following are not classified as real property? Fixtures. Emblements. A shrub planted in the ground. Air rights.

emblements

The power of governments to appropriate private property for the public welfare is known as

eminent domain

An earnest money agreement for the purchase of real property is not necessary in a cash sale when the amount of earnest money paid equals the purchase price. a legally enforceable contract which is binding on the seller as soon as it is signed by the buyer if the price and terms of the listing agreement are met exactly. legally enforceable and binding on the buyer as soon as it is signed by him. enforceable when the seller signs it and the buyer is notified of the seller's acceptance.

enforceable when the seller signs it and the buyer is notified of the sellers acceptance

A land sales contract passes the right to destroy the property. equitable title. legal title. no interest whatsoever.

equitable title

Under a conditional land sales contract, legal title is held by the vendee. equitable title is held by the vendee. legal title is held by a trustee. equitable title is held by a tustee.

equitable title is held by the vendee

The government receives the authority to take the property of one who dies without a will and without heirs by virtue of

escheat

By which of the following processes may a government acquire ownership of privately held land?

escheat and condemnation

A woman who lived in a retirement home and had no relatives, told her friend that she wanted her to have all of her property after she died, however she never made a will. Upon her death, her estate would

escheat to the state

The agency relationship of a real estate broker with his client is most often established by

express contract

Which estate is the most complete estate to own?

fee simple estate

Things that the law considers to be permanently attached to the earth are called

fixtures

At the time the expiration of an option to purchase, the optionee can request his deposit back. can renew the option or the same time period and terms. can repossess the property. forfeits his option money if he doesn't buy the property.

forfeit this option money if he doesn't buy the property

Which of the following is NOT a physical characteristic of land? Immobility. Indestructibility. Nonhomogeneity. Fungibility.

fungibility

A "due on sale" clause may be called a subordination clause. gives the lender the right to call the entire loan balance upon alienation. is the right of a mortgagor to repay a loan. gives the mortgagor the right to sell his property with a loan assumption by the buyer.

gives the lender the right to call the entire loan balance upon alienation

The buyer agreed to buy the property at the seller's asking price. They shook hands on the deal. Later, the seller refused to sell. If the buyer still wants to buy, he can hire an attorney and sue for non-performance. go to a small claims court and sue for damages. consult a real estate broker and ask her to explain that the seller must honor the agreement. do nothing.

hire an attorney and sue for non performance

Which of the following would be considered to be fixtures because of the manner of their attachment to the property? hot water heater entry area rug set of tools for fire place

hot water heater

6 methods of description

informal references metes and bounds rectangular survey system recorded plat assessor parcel number reference to documents

the greatest estate or ownerships in a real property

is a fee simple estate

define appurtenances

is a right, privilege, or improvement that belongs to and passes with land but is not necessarily part of the land.

If the vendee is in default, the vendor cannot pursue the right of foreclosure. is in title. no longer has equitable title. retains color of title.

is in title

The Texas Water commission is the agency of the state that exercises the

judicial functions of the department

A second mortgage is a seller's lien. a smaller loan. paid off 50/50 with a first mortgage at foreclosure. junior to a superior mortgage lien.

junior to a superior mortgage lien

An alienation clause in a mortgage loan is to the advantage of the borrower. lender. mortgagor. seller.

lender

Which is an example of pledged property? Estoppel Covenant Dedication deed Real estate given as security

lender

The sum of money agreed upon in advance to be the damages in the event certain problems occur later is best described as

liquidated damages

Betty is six months behind on her mortgage payments. Foreclosure by public auction has been ordered. The sale has not been completed. Betty may redeem her property by paying the last six months payments. full amount of the loan balance. loan balance plus accrued interest. loan balance, accrued interest and the accumulated cost of the foreclosure action and sale.

loan balance, accrued interest and the accumulated cost of the foreclosure action and sale.

The phrase "jointly and severally liable" in a note or bond applies when there are two or more makers obligees. trustees. holders.

makers

land description methods identifies a parcel of land by specifying its shape and boundaries?

metes and bounds

Generally recognized economic characteristics of land include all of the following EXCEPT scarcity. modification. situs. mobility.

mobility

All of the following are essential elements of a contract EXCEPT competent parties. lawful objective. monetary consideration. meeting of the minds.

monetary consideration

Unless there is a specific agreement to the contrary, the mortgage having first priority will be the mortgage first recorded. mortgage for the highest amount. original construction loan. mortgage with the earliest signature date.

mortgage first recorded

Which of the following is a lien on real property? Paid property taxes. Easements. Mortgages. Right of way.

mortgages

The parties to a mortgage are called mortgagor and grantor. mortgagee and beneficiary. beneficiary and trustee. mortgagor and mortgagee.

mortgagor and mortgages

A broker is preparing an original real estate sales contract and deed for a buyer and seller. Whom may he lawfully charge for this service? Buyer Seller Buyer and seller no one

no one

When property is purchased using a land sales contract, the instrument used to convey legal title would be an executory deed. a bargain and sale deed. a warranty deed non-existent since legal title is not transferred until the contract is paid off.

non-existent since legal title is not transferred until the contract is paid off.

Because one parcel of land cannot be precisely substituted for another, it is said to be

nonfungible

The party making an offer is called the

offeree

The party making an offer is called the

offeror

When a property is optioned, the optionor is the buyer. vendor. owner. lessee.

owner

Underground water that is not confined to a defined underground waterway is called

percolating water

Property that is not considered to be real estate is called

personal property

By what power do government bodies enforce zoning?

police power

When buying property under a land sales contract, which of the following does the buyer receive immediately? Possession Title Encumbrances Estate in fee simple

possession

Which of the following requires a public sale? Strict foreclosure. Entry and possession. Deed in lieu of foreclosure. Power of sale.

power of sale

A borrower who wanted to make a monthly payment larger than that called for by the note, could do so if the note contains a prepayment privilege. grace period. prepayment penalty. subordination clause.

prepayment privilege

Deed restrictions are examples of

private control of land

In the United States, the instrument most commonly used to evidence a debt on real property is

promissory note

Which lien would have highest priority? Property tax lien Mechanic's lien First mortgage or trust deed The lien which is recorded first

property tax lien

Which of the following claims against a real property interest would be the first to be satisfied? First trust deed Second trust deed Property taxes Newly filed IRS tax lien

property taxes

The process of dividing ongoing expenses and income items as of the closing date is called prorating. "as is" basis. closing. arbitrating.

prorating

Which of the following is true of a land sales contract? Beneficiary holds naked legal title Purchaser holds equitable title Vendee holds full legal title Mortgagor holds title

purchaser holds naked legal title

A line of townships running in a north-south direction in a rectangular survey is known as a

range

The system of land description that identifies land by reference to a recorded plat may be referred to by any of the following terms

recorded survey system lot-block-tract system recorded map system

The right of the mortgagor to reclaim his property upon payment in full of the obligation is reconveyance. redemption. recapture. right of deficiency.

redemption

Which of the following is NOT an example of a government's exercise of its police power? Rent controls Building codes Zoning laws. Restrictive covenants

restrictive covenants

The right, which allows the mortgagor to regain his property following a mortgage foreclosure, is known as right of redemption. due on sale. satisfaction of mortgage. defeasance.

right of redemption

Alice has an easement over Betty's adjoining property. Alice sells her property to Martha. The easement will

run with the land and will pass to martha automatically

An easement

runs with the land

1/60th of 1/60th of 1/360th of a circle is known as a

second

Area preference in the location of land is described as

situs

what is a township

six miles square

An encumbrance which becomes a lien on real property could be created by

special assessments

If a contract is breached and the damaged party wants the contract carried out, he would sue for

specific performance

In the rectangular survey system of land descriptions, which of the following run in an east-west direction?

standard parallels

Property owned by a person who dies intestate and without heirs will escheat to the

state

A real estate purchase agreement contract used by a multiple listing member may be all of the following EXCEPT receipt for earnest money. contract up to the date of closing. commission agreement between the seller and broker. statement of the buyer's costs.

statement of the buyers cost

Barry purchased Bob's home without accepting obligation for the existing loan. Barry is said to be buying the house subject to the loan. with an assumption of the loan. with an assumption by substitution of the loan. by contract for equitable title.

subject to the loan

What should a salesperson do if he receives a second bona fide offer after one offer has already been submitted to the seller but not yet accepted or rejected? Allow the first purchaser to meet the second offer before submitting it Hold the second offer until a decision is made on the first offer Submit the second offer immediately Submit the second offer only if it is better than the first

submit the second offer immediately

The NW 1/4 of the NW 1/4 of the NW 1/4 of a section of land contains

ten acres

A property owner leases a house to a tenant until a buyer is found for the house. Such a tenancy is called a

tenancy at will

The phrase "time is of the essence" means that the broker must present the offer quickly. that the transaction must close as soon as possible. that punctual performance of the time limits set by the contract is essential. little, since the phrase has no specific meaning.

that punctual performance performance of the time limits set by the contract is essential

the amount of earnest money necessary for a given transaction is Not determined by the buyer. the seller. the buyer and seller. the broker.

the broker

Morris sold the back half of her lot to Katz and gave Katz a permanent easement across her land in order for Katz to have access to the road. Which of the following statements is true?

the easement is an easement appurtenant

The term "point of beginning" refers to

the first corner of the parcel to be surveyed

define the term water table

the level at which water will be located

what are the test used In determining whether an article of personal property has become a fixture

the manner of attachment the adaption of the article to the land and the and the existence of an agreement between the parties

A promissory note describes the property being hypothecated. is the primary evidence of a loan. is an agreement not to do a certain thing. is not negotiable when secured by a mortgage.

the primary evidence of a loan

What is real estate

the right to use land. anything affixed to land with the intent of being permanent. rights to airspace and subsurface minerals.

An easement may be cancelled by all of the following EXCEPT the servient tenement. the dominant tenement. acquiring both lots. prescription.

the servient tenement

The requirement that transfers of real property be in writing is known as

the statue of frauds

adaptation annexation intention

the three test of a fixture

Two persons make an oral agreement. A day later they put it in writing with several small changes. What is true about the agreement in a court of law?

the written one would prevail

The legal grace period in an option to purchase real estate is how long? 72 hours 5 days 30 days There is no grace period

there is no grace period

Standard equipment of a land survey team includes

transit steel tape sight pole

A real estate contract can be declared void if signed by an unmarried minor t o f

true

In the absence of a special provision for such an event, an offer to purchase will probably be voided by the death of either buyer or seller before acceptance.

true

An option is given wherein consideration is stated as $1.00. The option is valid. invalid for lack of sufficient consideration. void. unenforceable.

valid

Assuming that no fraud is intended, what is the status of a contract signed by an illiterate person?

valid

From the following, select the parties to a land sales contract Lessor-Lessee Mortgagor-Mortgagee Grantor-Grantee Vendor-Vendee

vendor-vendee

A contract created under duress is

voidable

A contract entered into by a minor is

voidable

When a contract appears to be good and binding but, in fact, one of the parties may legally reject it, the contract is said to be unenforceable. valid. void. voidable.

voidable

contract entered by a minor is

voidable

The phrase "as is" when used in real estate contracts means the buyer is accepting the property without a survey. a title report. new financing. warranty as to physical condition.

warranty as a physical condition

Termination of an easement appurtenant may be accomplished

when the purpose of the easement no longer exists