2020 test 1

10) Wish clause, if included in a mortgage, permits a lien recorded subsequent in time to have a superior positioning to the mortgage that was recorded prior in time A Subordination clause B release clause C subjective clause D superior clause

A

15) Land consisting of a quarter section (160 acres) is sold for $1805 per acre. The total sales price is A $288,800 B $72,200 C $396,000 D $45,125

A

18 The purchase contract is the most important document in the sale process because A it provides the road map for the closing B the agent is not guarantee payment without it C preparing sales agreement is good for the legal business D verbal real estate contracts can only be recorded in select countries

A

21 Important provisions of RESPA include all the following except A the settlement location must be at an attorney or bank office B a uniform settlements statement C the lender's estimate of settlement cause D the disclosure of controlled business

A

24) An abstract of title contains A the summary of a title search B an attorney's option of title C a registers certificate of titles D written opinions of the title from the county registrar's clerk

A

27) The term "walk through" refers to A the buyers final inspection of the property to check its condition B an FHA approved termite inspection C a seller's check of the premise before an open houses is held D an appraisers inspection of the interior of the subject property

A

31) Net operating income (NOI) is found by A Subtracting yearly operating expenses from effect gross income B Dividing effective gross income by cap rate C Subtracting yearly operating expenses from the appraisers estimate of potential gross income D Multiplying effect of gross income by the cap rate

A

35) Rufus Chaffee Hires Chris Brown, a property manager at, to lease a house that he owns. Rufus is Chris's A Client B customer C fiduciary D subagent

A

37) The landlord has the right to access the premises A in case of emergency B for the purpose of making unannounced "spot" checks C When the tenant is away for an extended time D None of the above

A

40) The right to occupy property without interference for a specific period of time is known as a A leasehold B perspective easement C trespass D eminent domain

A

41) The civil rights act of 1866 prohibits discrimination and realist a based on A race B race and gender C handicap and country of origin D whether buyer is from one of the former Confederate States

A

43) When an appraiser to deducts depreciation using the reproduction cost of a building, the depreciation represents A loss of value due to any cause B cost to modernize property C lack of site improvements D loss of value due only to age of improvements

A

48) Prices are likely to rise when there is a A seller's market B buyer's market C thin market D local employers introducing a new product line

A

50) The most profitable way in which a particular property can be utilized is known as its A highest and best use cloud B plottage value C condoization D principal of progression

A

51) In the market or sales data approach of appraisal, the sales price of similar, recently sold properties are A adjusted B analyzed C assessed D only use if the sales have occurred within the past 6 months

A

52) A single family property located in an industrial area has a minimum value because of the principle of A conformity B contribution C noise and air pollution D diminishing return

A

57) Of the following, which lien has the lowest property? A On secure judgment B a mortgage or trusteed C property taxes D mechanic's lien

A

61) A zoning commission in may grant a variance to properly use when which of the following exist A limitation of feasible building sites due to land contours B property involvement will be beneficiary for neighborhoods C alternative building sites that increase owner's cost D over budget development cost to a subdivider

A

67) A valid deed must contain A a legal description B a survey of the property C date stamp from the county's registrar the D signature of the grantee

A

71) Which of the following would not be allowed under the federal housing act A The owner of a 9 unit apartment building renting to men only B A landlord refuses to rent his double home in which he lives to a woman with 2 children and 2 cats C In elks logs will rent rooms only to members who belonged to elks lodge D Housing limited to persons a 62 or order

A

75) All are protected classes except A a 34 Your old man B national origin C race D handicap

A

8) The meningers Needed two different loans to buy their 1st home. The loan that will have 1st claim on the value of the house in case of foreclosuer is the one that was 1st A Recorded B signed C applied for D satisfied

A

80) Which of the following would not be permitted under the federal fair housing act A The owner of a 20 unit residential apartment building renting only to black men B an Arabian owner refusing to rent his home to an Israeli C the USO in NY renting rooms only to service personnel D An owner who is on the side of a duplex refusing to rent to a family with 5 children on other side of the duplex

A

83) The buyer has been held to be in default on a contract of sale. If buyer and seller had not agreed on liquidating damages, the seller could do which of the following A Sue the buyer for compensatory damages B Obtain a court order preventing the buyer from purchasing another property C Have the buyer incarcerated D Only keep the buyer's earnest deposit

A

84) The statute of fraud requires that A Certain contracts, including those of real estate, must be in writing to be enforceable B The seller of real estate provide a written disclosure about the condition of the property C Real estate brokers answer buyers' and sellers' quastions honestly D Properly deeds must be recorded in the appropriate county registry

A

86) The brokers only responsibility at the conveyance is to A Verified and received the brokerage fee/commission B Explain the clauses found in the deed C Review the title report for clouds or other problems D Interpreted the terms and conditions contained in the loan document

A

89) An appraiser estimates annual rent collections on an investment property of $99,000. The vacancy factor is 5% and operating expenses run 25% of gross income. A similar investments to generate a ROI of 15%. Using the income approach to value, what is the market value of this property A $462,000 B $627,000 C $396,000 D $660,000

A

12) How many FHA insured and VA guaranteed loans be assumed A On payment of an assumption fee to the seller B either freely or on qualification of the buyer, depending on the date of the loan C Only if the new buyer is a veteran D With garanteed agreement of the selling broker

B

13) Can a ranch contain a basement A Yes, many ranch's have a downstairs level B No, ranch's are built on a cement slab and do not have a true basement C Yes, one of the habitable areas is located somewhat underground D No, ranches have sellers

B

23) Mark Stewart, a widower, died without leaving a will or other instructions. His surviving children received ownership of his real estate holdings by A adverse possession B law of intestate secession C beneficiary writ D eminent domain

B

26) tammi coady lives in one side of a duplex house. She wants to advertise the other side as non smoking. Can she legally do so? A Yes, because she occupies part of the house herself B Yes, because the right to smoke is not protected by law C No, because a property owner can not advertise discriminatory practices D No, because each housing unit is its own book and page number

B

3) Commercial banks would rather make short term loans life to structure loans and 90 day business loans. The reason for their preferences that A The source of their lending funds is primarily from CDs B The source of their lending funds is primarily from checking account C The source of their lending funds is primarily from saving accounts D The source of their lending funds primarily from issuing bonds

B

34) The seller of a house built before 1978 is required by law to furnish the buyer with a A Good faith estimate (GFE) of settlement cost B Lead paint information booklet C seller's property information disclosure D proof of flooded insurance

B

38) What would you pay for a building producing $20,000 net income annually and showing a minimum rate of 8 percent A $50,000 B $250,000 C $160,000 D $200,000

B

4) After the sale of the collateral property, it is determined that the net proceeds did not clear the debt. In this situation, the borrower is likely to receive a A Letter of defeasance B Notice of a deficiency judgment C Certificate of liability D notice of closure

B

45) Assuming the NOI remains constant, what will happen to the present value of the property if the cap rate increases? The present value will A increase B decrease C stay the same D increase at the 1st and then decrease

B

46) The close sale price of an income property divided by its gross monthly rent equals the A unit density ratio B gross rent multiplier C gross income multiplier D capitalizations rate

B

49) What will the amount of the taxes payable be if the property's assessed value is $170,000 the tax rate is 50 Mills in a community where that equalization factor is a 120% A $12,000 B $10,200 C $3,460 D $8,500

B

53) The most accurate way to uniquely locate and bound a parcel of real property is to use A points that are shown on the lender's plot map B a meats and bound survey C the assess or parcel number D latitude and longitude bearings

B

54) The purchase of a cooperative apartment receives shares in the cooperative and a A bargain and sale deed B proprietary lease C joint tenancy D limited partnership

B

65) Which of the following actions is legally permitted? A advertising property for sale only to a special ethnic group B Refusing to make a mortgage loan to a minority individual because of a poor credit history C Altering the terms of a loan for a member of a minority group D Telling a minority individual that an apartment has been rented when in fact it has not been rented

B

68) An appraiser may take this factor into consideration when appraising property A familial status B age of property C religious of area churches D race of neighborhood

B

76) When may your broker functioning As an intermediary appoint one licensee to communicate with the seller and another licensee to communicate with the buyer? A When in the judgment of the broker it is best to make such appointments B When written permission to do so has been obtained from the parties C When the parties have given verbal approvals to make such appointments, after shaking hands in agreement D When the seller has given written consent for the broker to do so

B

78) Which of the following listings is risky and open to fraudulent dwellings A Listening your brother's home, under applicable guidelines B A net listing C an exclusive agency D an exclusive right to sell

B

81) A broker takes a sales agreement to his seller for full price. The seller states he will not accept this agreement because the buyers are Mexican. The broker should do which of the following A Abide by the principal direction and returned offer to the selling broker B Explain to the owner that his refusal to sign because of the buyers race violates federal laws C Bring sales agreements to the seller from non Mexican buyers only D Tell the buyers that they'll need to find another property

B

82) After a purchase contract is it accepted, the parties may later make additional agreements without changing the original document by use of A a time extension B a revision C an addendum D a contingency

B

1) A home owner has a balance of $149,570.35 remaining on the mortgage. The interest rate is 7.5% in the monthly payment is $1150.00. After the next 2 payments, the balance will be A $149,451.30 B $149,355.57 C $149,139.04 D $149,570.05

C

11) Express covenants that protect the grantee are found in a A quit claim deed B deed of trust C general warranty deed D sheriff's deed

C

16) A purchase contracts for a new home for $250,000 and, after making a 10% down payment, applies for a fixed rate loan of 7.5%. At the settlement on April 10, the lender collects interests up to May 1. what is the interest charge to the buyer shown on the settlement statement A $1250.00 B $492.19 C $984.38 D $833.33

C

17) The entirety that relinquishes ownership through a deed of trust mortgage foreclosure is the A lender B beneficiary C mortgagor D mortgagee

C

19 Which of the following phrases is not discriminatory in an advertisements to lease a nonexempt 50 unit apartment complex under the current federal housing act A no handicapped alterations will be made B adults only; no children C no propane or charcoal grills on premise D females only

C

28) An owner who transfer real property through a will is known as A devisee B legatee C testator D beneficiary

C

30) Property managers often mistake management decisions about tenant selection and budgets for their clients. In these relationships, the property manager is acting as an A Sub agent B power of Attorney C General agent D independent contractor

C

42) Market data approach appraising may require adjustments of sold comparable as by an appraiser for all the following except A sale date of comparable B finance made available by seller C replacement cost of existing homeowner's recent improvements D lot size and location

C

44) A residential property was bill a 105 years ago. 3 of the 5 bedrooms have no closet, the basement floor is heavily cracked, and the original woods shake roof needs repairs. To the appraiser, the most important consideration is A How the bedrooms could be reconfigure to provide some storage B How much it will cost to finish the basement floor C The sale price of a nearby similar property D The life expectancy of the roof

C

47) For appraising a 15 year old single family house, the best data is the A probate rent figure B replacement cost C recent sale prices of nearby houses D owner's original cost plus money spent on improvements + market appreciation

C

5) FHA mortgage insurance premium is calculated at a rate of 1/2 percent annually. How much is the premium for the month in which the remaining principal owed is $184,694? A $0.05 B $24.00 C $76.96 D $92.34

C

56) The type of ownership that would give an investor the greatest flexibility when selling his or her interest would be a general partnership B joint tenancy C ownership in severely D a limited partnership

C

59) Mike owned fee simple title to a lot next door to a zoo. He gave the lot to the zoo as a gift. However, he wanted to make sure it would always be used for zoo purposes. His attorney prepared his deed to convey ownership of the lot to the zoo "so long as it is used for a zoo purposes." The zoo owns a A fee simple estate B fee simple absolute C fee simple determinable D subordinating estate

C

60) an acre contains approximately A 5270 square yards B 45,000 square yards C 43,560 square feet D one quarter square mile

C

62) Tenancy by the entirety is a specific form of ownership available only to A sole owners B Limited liability corporations C married couples D Civil unions

C

64) A purchase in which the seller holds title until a specific number of payments have been made is known as a A future delivery purchase B deferred transfer mortgage C contract for deed D collateral mortgage

C

69) Which is not in exemption to the federal housing act? A an owner who occupies a 1 to 4 family dwelling may limit the rental of rooms or unit B housing may be limited for use by senior citizens if occupied by one person at least 55 age or older C a man with 2 children D religious organizations may limit the occupancy of real estate that it owns to is member if the units are not owed for business purposes

C

7) What is the difference between MIP and PMI A MIP is required only on VA mortgages B PMI is the older form of mortgage insurance C PMI Ensures conventional mortgages, and MIP insures FHA loans D There's no difference; the 2 terms mean the same thing

C

79) In a real as they transaction, a broker does not affirmatively represent either the buyer or the seller as agent. He is acting as A non representing dual agent B an undisclosed dual agent C a transaction broker D an illegal real estate subagent

C

85) The buyer makes an offer to purchase a property and specifies that the owner accepts or rejects the offer within 48 hours. Before hearing back from the owner, the buyer locates a more attractive property and withdraws the offer. Is the buyer legally permitted to withdraw his offer? A Yes; an offer with a condition to respond and 48 hours is not valid B No; the offer is binding until the 48 hour time period expires C Yes; Either party may withdraw an offer or counteroffer at any time prior to its acceptance D Yes; Until the seller physically signs an acceptance, it is not a valid contract

C

77) When a buyer makes an offer in a cellar changes a few of the turns before he sighs and return it, there is a A rejection B sellers concession C counter offer D conditional rejection

Cq

2) The lender's right to call in the loan in case of default and put the security property up for sale is based on the mortgage documents A Find print B equity of redemption C defeasance clause D acceleration clause

D

20) The purpose of RESPA is to A help a buyer know how much money is required B make sure that buyers do not borrow more than they can afford C allow the realtor to accept kickbacks from the buyer's lender D see that a buyer and seller know all settlement cost

D

22) Which method of foreclosure is used in a deed of trust mortgage lien? B probate court ordered sale C Sheriff's at the courthouse D Non-judicial power of sale

D

25) A bookstore in the North mall pays a base rent each month plus additional rent based on the amount of business it does. It is operating under a A ground lease B holdover lease C net lease D percentage lease

D

29) Kelly has a 3 year lease on her apartment. At the end of the three years A The landlord must notify her if he wants her to vacate B She must give the landlord one month's notice of termination or departure C The landlord must give her an option to extend at the current rent amount plus are market escalation D Neither party need give the other any notice of termination

D

32) An oral agreement between a lessor and lessee is legally A a valid tenancy for one year B unenforceable due to the statute of fraud C unenforceable due to the statute of limitations D a valid tenancy at will

D

33 A prospect for the lease of a commercial property feels the need for adversarial representation And hires a broker to negotiate the lease on his behalf. The contract entered into between the prospect and the broker is called A An authorization to negotiate with limited power of attorney B A cooperative brokerage agreement C A property management agreement D A buyer broker agreement

D

36) The responsibility of the property manager includes all of the following except maintaining the property while preserving finances marketing for a cousin tenant base C preparing and submitting budgets D seeking interest buyers

D

39) Though correct formula for estimating value using the cost approach is A cost to reproduce + value of land = value B depreciation + value of land - cost to reproduce = value C value of land + cause to reproduce_ depreciation = value D cost to reproduce - depreciation + value of land = value

D

55) A small ranch is being established on a newly acquired 25 acre parcel of land. The new owner plans to enclose the property with a chain link fence. The rectangular lot has 1089 feet of frontage on the state road. How many feet of fencing will be needed to A 2,090 feet B 4,595 feet C 4,270 feet D 4,178 feet

D

58) Rob has a right to cross Scott's property to get to his property. What is this right call? A a right away B easement by prescription C an easement in gross D an apprutenant easement

D

6) The Corcorans have a gross income of $60,000. But lender wants them to spend no more than 33% of their income on their housing expense. A house they can buy for $240,000 as $2,400 in annual property taxes. Homeowners insurance will cost about $400 per year. At today's interest rates, monthly payments would be $6.65 per $1,000 borrowed on a 30-year mortgage. what is the smallest amount they can except to spin for a cash down payment A $20,000 B $48,000 C $53,940 D $26,970

D

63) Which of the following is not a physical characteristic of land A wetland concentration B indestructability C non-homogeneity D situs

D

66) An restriction is also known as a land use covenant. Which of the following is an example of a land use covenant? A minimum Square footage of homes within a subdivision B type of fencing constructed by owner C energy-star fixtures within a structure D both a and B

D

70) Which of the following statements best describes a real estate agents liabilities concerning environmental hazards A Residential real estate agents don't need to know about environmental conditions B Unless the buyer notice something, the real estate agent does not have to worry about it C Disclosure of environment to hazards is the responsibility of the seller D A real estate agent licensee could be liable if he or she should have known about a condition, even if the seller neglected to disclose it

D

87) one effect of a clause in a sales agreement that states that "time is of the essence" might be that A the seller can take care of matters at their convenience B The buyer must deal with the details of the contract as they occur C All parties, exclusive of the agents, must attend to details quickly D All parties must attend to those details called for in the agreement in a timely manner

D

88) At a general meeting of a broker's trade association, Several members begin talking about fees and business practices. This sort of activity could be considered A A good way for brokers to learn about the different practices regionally B Activity endorsed by the chambers of Commerce C An appropriative activity within the association D Violation of the Sherman anti-trust act

D

9) In a loan closing, proper signatures on the promissory note creates A Recordation of the lien on the land records B the lien on the property C A nonbinding fiscal contract D the indebtedness of the borrower

D

90) The beans put their house on the market, the Browns made a written purchase offer, and the beans accepted the offer in writing. When is a contract valid A Immediately B as soon as the signatures are notarized C when it is place in the public records D when the Browns are notified of the acceptance camera verbally or in writing

D

91) The investor criterion for a home mortgage is an uninsured LTV ratio of 90% of the appraisal. The sales agreement and appraisal is in the amount of a $180,000. Following underwriting guidelines, the buyer qualifies for a loan of a $155,000. How much of the purchase will be financed by the investor A $162,000 B $135,000 C $108,750 D $155,000

D

92) The seller offers to pay 3 points on the buyers 80% loan. If the house sells for $350,000, what is the expense to the seller A $10,500 B $2,400 C $3,000 D $8,400

D