Colorado Contracts & Regulations Unit
A water right that entitles the owner to divert a specified flow of water from its source for immediate use is a: 1. diversion right 2. a priority right 3. prior appropriated right 4. direct flow right
4
A broker can list a home as a seller's agent and at the same time work with the seller as a transaction-broker in the purchase of another home. 1. True 2. False
1
The licensing law sets a standard for 1. competency and integrity. 2. performance. 3. intelligence. 4. creativity.
1
A broker may omit part or all of any provisions in the Commission-approved contracts so long as the provision's caption or heading is unaltered on the form followed by the words "OMITTED". 1. True 2. False
2
A broker who wants to help a buyer must disclose all the broker relationship options and let the buyer pick. 1. True 2. False
2
A licensed appraiser 1. needs only to pass the real estate license exam. 2. is a person licensed, registered or certified by the Appraisal Board and does not need a real estate license. 3. is a person licensed, registered or certified by the Appraisal Board in conjunction with a real estate license. 4. any one can act as an appraiser in the state of Colorado without a license.
2
The city is voting next Tuesday to down-zone an area you are showing property in 1. You must tell your buyer only if you knew that down-zoning was being considered. 2. It is your responsibility to know that it is being considered and must tell your buyer. 3. You are only responsible to tell your buyer if it would affect his decision to buy. 4. Gee, who reads the paper anyway?
2
Under Colorado license law, a broker may act as a dual agent under certain circumstances. 1. True 2. False
2
You can become an employing broker after 2 years and completing additional education. CREM Chapter 1-9 1. after 1 year and passing an additional test. 2. after 2 years and completing additional education. 3. after 3 years and passing an additional test. 4. after 4 years and passing an additional test.
2
You may NOT use personal assistants to 1. show clients properties. 2. go over purchase contracts when you are not available. 3. gather information on a property that is being listed. 4. hand out pre-printed information on a property.
2
Your company has a policy that all transactions shall be as a transaction broker. When you list your own personal residence, you must act as a TB. 1. True. 2. False.
2
Your company has a policy that all transactions shall be as a transaction broker. When you list your own personal residence, you must act as a TB. 1. True. 2. False.
2
A developer 1. is an owner of a photographic shop. 2. is a licensee who sells new homes. 3. is an owner of a parcel of land that has been subdivided into 20 or more residential lots. 4. is an owner of a parcel of land that has been subdivided into at least 10 residential lots.
3
Additional Provisions can be used to add 1. transaction-specific terms that result from negotiations 2. transaction-specific terms that result from the instructions of the parties to the contract 3. both of the above statements are true. 4. All of the above plus any other standard terms that the brokerage company puts in all contracts.
3
An individual who charges a fee to sell options on real estate must have 1. an option dealer's license. 2. a securities license. 3. a real estate broker's license. 4. (2) and (3) are both true.
3
You are considered _______________ if you promote the sale or lease of a subdivision. 1. lucky 2. a real estate licensee 3. a developer 4. both (2) and (3)
3
Which of the following is not considered a "material fact" which must be disclosed? 1. Leaking roof. 2. A foundation problem that has been corrected. 3. Trees that are diseased. 4. The property boundary dimensions.
4
You do not need a real estate license if you 1. for a fee, sell a business opportunity that includes a lease. 2. for a fee, offering a property for sale (but the property never sells). 3. for a fee, giving out information on properties for rent. 4. for a fee, offer to sell a gas lease.
4
Rule F covers 1. The Colorado Real Estate Commission's rules governing approved forms. 2. The Colorado Real Estate Commission's rules governing separate accounts. 3. The Colorado Real Estate Commission's rules governing commission payments. 4. All of the above are true.
1
A broker who works with a buyer as a transaction broker can change status (become a buyer agent) at a later date? 1. True 2. False
1
A licensee working with a tenant as a tenant agent 1. must use a Commission approved exclusive tenant contract. 2. there is no Commission approved tenant agent form. 3. may help the tenant find a rental, but cannot charge very much for helping. 4. the fee owed by tenant can never be greater than 8% of the gross lease.
1
All licensees who do not acquire E&O Insurance will have their license "put on ice" (inactivated). 1. True. 2. False.
1
If a Lead-Based Paint Disclosure (Sales) form is not completed and signed by the Seller and required real estate licensees prior to the parties signing the Contract to Buy and Sell Real Estate 1. the purchase contract is void. 2. the purchase contract is valid, and all parties may be liable for fines. 3. the purchase contract is valid, and all parties must sign the disclosure form before closing to avoid any fines. 4. the disclosure is just one more option for the buyer to choose or not to choose in the purchase contract.
1
If you list a home that has a tenant 1. you are bound by the terms of the lease. 2. the tenant must leave at such time as the home sells. 3. the tenant has 30 days in which to move if the house goes under contract. 4. the landlord must pay the tenant one month's rent and moving costs in order to force the tenant to move.
1
In an executory Contract to Buy and Sell Real Estate the purchase price is $150,000. If the appraisal comes in at $145,000 1. The buyer may elect to terminate the contract or must buy at the contract purchase price 2. The buyer would not be able to get the proposed loan so the contract would terminate. 3. The seller is obligated to respect the appraised value. 4. The seller has the option to sell at $145,000 or terminate the contract
1
The Contract to Buy and Sell contains a provision to make it contingent on an appraisal 1. At least as high as the selling price 2. Higher than the selling price 3. At least as high as the loan amount 4. At least as high as 90% of the selling price
1
The following is NOT TRUE if a residential building permit was issued on a listed property before Jan. 1, 1978 1. The seller is obligated to remove all lead base paint 2. The seller must provide the lead base paint warning 3. The seller must disclose any known lead based paint hazard 4. The broker must make sure the lead base paint disclosure accompanies any offer
1
To make a change to a contract 1. the licensee must use an amend/extend contract. 2. the licensee must have the buyer/seller cross out all parts that are being amended. 3. the licensee must have the buyer/seller cross out the parts that are being amended and then have both parties initial the crossed out portion. 4. the licensee must have the buyer/seller cross out the parts that are being amended, write in the change and then have both parties initial and date the amended parts.
1
When a seller is providing seller financing, the approved Contract to Buy and Sell 1. Permits the seller to terminate the contract based on the buyer's credit information 2. Requires the seller to perform a background check on the buyer 3. Permits the buyer to terminate if the seller asks for the buyer's credit information 4. Requires the buyer put at least 20% down as earnest money
1
When making disclosures in a lease transaction, a broker may substitute the term "Landlord" for the term "Seller" and the term "Tenant" for the term "Buyer" in the 1. Brokerage Disclosure to Seller. 2. Definitions of Buyer Relationships. 3. Sellers Property Disclosure. 4. Green Addendum.
1
"Good faith money" 1. is considered option money. 2. is tendered as earnest money. 3. is the American dollar. 4. required for a valid contract
2
A lease may be overridden and a tenant forced to vacate if 1. the landlord sells the property. 2. If the lender forecloses a loan that was recorded prior to the lease agreement. 3. the lender forecloses and the property is sold at auction. 4. A lease may never be canceled by a sale.
2
A seller reviewing the buyer's credit report for seller financing 1. May discuss the credit report with anyone he feels necessary 2. Must be kept confidential 3. May be shared but only with his broker 4. May share the information with other lenders
2
A seller's agent may be paid 1. only by the seller. 2. by buyer, seller and buyer's lender if all parties agree prior to contract. 3. by anyone from whom the agent can secure a payment agreement. 4. All of the above.
2
According to the Residential Contract to Buy and Sell Real Estate 1. The buyer must pay for the appraisal 2. Check the box to specify who pays for the appraisal 3. The seller pays for the appraisal 4. The buyer and seller split the cost of the appraisal
2
According to the Residential Contract to Buy and Sell Real Estate, a buyer who is dissatisfied with inspection results..... 1. Must offer the seller an opportunity to satisfy the problems 2. May terminate the contract with written notice immediately 3. May terminated the contract verbally, immediately 4. Must present the seller with a list of items to be fixed within 1 day of the resolution deadline
2
According to the contract to Buy and Sell Real Estate, if a buyer will seek a new VA-guaranteed loan, the value of the property is established by: 1. the appraiser. 2. the Veteran's Administration. 3. HUD 4. the VA-approved lender.
2
If a buyer broker gets a property under contract and then the sellers change their mind and will not close, the buyer owes the buyer broker 1/2 of the returned earnest money. 1. True 2. False
2
If a buyer who has signed a buyer broker contract purchases only a share in a property 1. a commission is not owed. 2. a commission is owed as the contract states a purchase has occurred if "any interest" is transferred.
2
If a buyer, after having a liquidated damages purchase contract accepted, purchases a car which causes the buyer not to qualify for the loan, and if seller does not timely receive written notice to terminate, 1. the purchase contract terminates and the buyer receives the earnest money back. 2. the buyer is in default and will forfeit the earnest money. 3. the contract provides 10 days for the buyer to seek alternative financing 4. the buyer's actions change the contract from "liquidated damages" to "specific performance"
2
If an employing broker chooses to be designated as the agent of a seller, the employing broker must also designate to another associate broker the duties of being the "non-interested party". 1. True 2. False
2
A water right is 1. personal property because the water may be moved. 2. an improvement to the land. 3. real property. 4. real property once adjudicated by a water court.
4
If the sellers remain in the home past the agreed upon possession date and time 1. the buyers must wait until they leave and are entitled to the daily charge as agreed upon in the contract. 2. the buyers may evict the sellers and receive a daily charge as specified in the contract until they vacate. 3. the sellers cannot stay past the possession date. 4. the sellers have an additional 5-day grace period in the event their movers are delayed.
2
In a 1031 exchange all of the following are true EXCEPT: 1. The seller defers paying taxes on the sale of income property. 2. The party buying the seller's property must have a property that the seller wants for the exchange. 3. There is a third party (the exchange company) who "holds the seller's money after the sale" until a property is located which the seller wishes to purchase. 4. In general in order to defer taxes, the seller must use his total proceeds from the sale of the old property toward the purchase of the new property.
2
In the Exclusive Right-to-Sell Listing Contract the seller is required to sell the home if a purchase contract is made which meets all the conditions of the listing contract. 1. True 2. False
2
In the Exclusive Right-to-Sell Listing Contract, all of the following would be considered a material fact to be disclosed to a buyer except 1. the house has lead paint. 2. the home has not been tested for radon. 3. the roof leaked two years ago, but has been repaired. 4. the neighbor next door has an easement to cross the property.
2
The Commission-approved Contract to Buy and Sell Real Estate (Residential) provides for signatures to be evidenced by facsimile, but: 1. original signatures must be presented within three (3) business days. 2. original signatures must be provided upon request of any party. 3. the buyer (not the seller) must provide original signatures prior to closing. 4. the seller (not the buyer) must provide original signatures prior to closing.
2
The Contract to Buy and Sell Real Estate 1. Requires the Seller to provide to buyer all CIC governing and financial docs only for time share properties. 2. States the Seller authorizes the Association to provide the Association Documents to Buyer, at Seller's expense 3. States if neither box in this § 7.3 is checked, Seller will cause the Association Documents to be provided to Buyer, at Seller's expense, on or before Association Documents Deadline 4. States the Seller authorizes the Association to provide the Association Documents to Buyer, at Buyer's expense
2
The buyer and seller may make minor modifications to the Contract to Buy and Sell Real Estate orally. 1. True 2. False
2
When the parties have a dispute about the earnest money 1. The broker may keep the earnest money 2. The broker may interplead the matter and send the parties to court 3. The seller must return the earnest money to the broker 4. The seller must return the earnest money to the buyer
2
Which of the following contracts would use the term "exclusive, irrevocable contract?" 1. Licensee Buy-Out Addendum 2. Exclusive Right-to-Sell 3. Contract to Buy and Sell Real Estate 4. both (2) & (3)
2
A farmer desiring to sell some water rights to a developer must do so by 1. statutory dedication. 2. a state engineer grant. 3. an appropriate form of deed. 4. including some land since water cannot be separated from the land.
3
A stock pond built on large acreage is owned by 1. the party who built the pond. 2. the city or county nearest the parcel of land. 3. the citizens of the state of Colorado unless adjudicated. 4. the first person to register the pond with the state engineer.
3
According to the Contract to Buy and Sell Real Estate, the buyers get possession 1. at 12:01 a.m. the day of closing. 2. 3 days after delivery of deed. 3. negotiable. 4. when the seller signs the deed at closing.
3
Carbon Monoxide Detectors must 1. Be installed within 15 feet of the entrance to each room lawfully used for sleeping 2. Be installed within 10 feet of the entrance to each room lawfully used for sleeping 3. Be installed within 15 feet of the entrance to each room lawfully used for sleeping when the home is marketed for sale 4. Be installed within 10 feet of the entrance to each room lawfully used for sleeping prior to closing
3
If a person buys one rental property, collects the rent, but makes no payments on any existing encumbrance, the person 1. could be taken to court for "equity skimming". 2. can be charged with a class 4 felony. 3. can be charged with a class 5 felony 4. can be awarded equitable redemption after any foreclosure.
3
If buyer and seller do not agree in writing to settlement of inspection objections by the contract Resolution Deadline, 1. the buyer has one calendar day following the Resolution Deadline to withdraw the Notice to Correct 2. the buyer has two calendar days following the Resolution Deadline to withdraw the Notice to Correct 3. the buyer may sign the BUYER'S WITHDRAWAL OF INSPECTION OBJECTION and move forward with the contract 4. the buyer must terminate the contract
3
If the buyer cannot meet the loan objection deadline, 1. The buyer's broker may inform the seller verbally to keep the agreement from terminating 2. The buyer's broker must send a certified letter to the seller to keep the agreement from terminating 3. Written mutual agreement is required to extend the deadline 4. The transaction will terminate
3
If there is a foreclosure in process 1. you can not list the home for sale until the seller stops the foreclosure. 2. you can list the home, but need not let all other real estate agents know it is in foreclosure. 3. you can list the home for sale and try to get it sold and closed before the foreclosure sale. 4. you can list the home for sale and try to get it sold and closed until the end of the owner's redemption period
3
In the Exclusive Right-to-Sell Listing Contract, if the transaction-brokerage box is checked at the top, which of the following should the T-B not do? 1. Date the contract for a set period of time 2. Advise seller regarding the transaction and accounting in a timely manner. 3. Promote the interests of seller with the utmost good faith, loyalty and fidelity. 4. Find a ready, willing, and able buyer.
3
Software used to generate approved standard forms 1. must be approved by the commission 2. must be in WORD format 3. must have controls to prevent the language of the form from being altered 4. all of the above
3
The walk-through inspection, called for in the Contract to Buy and Sell 1. Allows the buyer one more chance to find defects before closing 2. Is to verify that the condition of the property meets the buyers requirements 3. Is to verify that the condition of the property meets the requirements of the contract 4. Is mandatory
3
Which of the following would a listing broker be responsible to pay? 1. Water and sewer if seller is out of town. 2. Lawn care. 3. Food and drink used at an open house. 4. Cleaning service.
3
A broker may add a clause to additional provisions of the Contract to Buy and Sell Real Estate 1. limiting the broker's ability for confirming zoning 2. requiring the seller to provide the property in professionally clean condition at closing 3. requiring the seller to have a professional clean and service the furnace prior to closing 4. both 2 and 3 are correct
4
A broker who is engaged by only one party to a real estate transaction is known as a 1. Transaction Broker 2. Single Agent 3. A limited agent 4. Both 2 and 3 are correct
4
A buyer who hires a buyer agent must sign the Change of Status form if the broker is to show and sell a company listing. 1. True 2. True, unless the buyer instructed the broker to become a dual agent. 3. False, the agency relationship would terminate and the buyer would automatically become a customer. 4. False
4
As a seller's agent, if a broker intends to work both sides of a transaction without the buyer being a "customer", what accommodation must have been made in the Exclusive Right-to-Sell Listing Contract? 1. The Exclusive Right-to-Sell Listing Contract must have been signed as Transaction-Broker. 2. The seller must have signed a "Change of Status, Transaction-Broker Disclosure" form and attached it to the Exclusive Right-to-Sell Listing Agreement. 3. The seller and buyer must have signed "Change of Status, Transaction-Broker Disclosure" forms at the time of their respective listings. 4. The seller must have elected to allow the change of status at the time the listing was signed by checking the box on the listing contract.
4
Earnest money is held by 1. The broker 2. The listing broker 3. The title company 4. The entity named in the contract
4
If a seller has actual knowledge that the property is in foreclosure, the seller must fill out the Contract to Buy and Sell Residential (CO Foreclosure Protection Act) 1. There is no Foreclosure Property Addendum, listing agents must not mention that the property is in foreclosure. 2. Only if the property is residential 3. Only if the property is commercial 4. Only if the property is residential and the buyer is an investor
4
If the buyer is assuming the seller's loan 1. the buyer has the right, after reviewing the loan documents, to decide not to purchase. 2. the seller must give the buyer the loan documents to review prior to the writing of the contract. 3. if the buyer does not state, in writing, his disapproval of the loan documents by a certain date, the contract stays in full force. 4. (1) and (3) are both true.
4
If the title commitment shows there is a defect 1. The seller may have the right to try and correct the defect 2. The buyer has the right to terminate the contract 3. The title policy will insure it 4. Both 1 and 2 are correct
4
If you list a property which has a lease on the security system, a licensee should: 1. check to see if the lease is transferable 2. if it is assumable, a purchase contract would state the terms in "Additional Provisions". 3. if it is leased, you do not check the Inclusions box marked, "security systems". 4. both (1) and (2) are true.
4
On the Exclusive Right to Sell Contract, if a buyer forfeits his earnest money check, 1. the seller gets all the earnest money 2. the seller must split the earnest money equally with the listing broker 3. the seller and broker split the difference after the broker expenses are deducted 4. the seller and broker decide who gets the earnest money by checking the box on the contract
4
Real Estate Brokers are required to disclose all of the following EXCEPT: 1. The existence of lead based paint 2. That the property lies within a flood hazard area 3. Where to obtain information on sex offenders 4. That a sex offender is living in the neighborhood
4
The following statement(s) is/are true regarding disclosing the source of water of a property.. 1. Seller is responsible for disclosure of water source with the Source of Water Addendum 2. Seller is responsible for inadequacy of water source 3. Seller may provide Source of Water by providing the Seller's Property Disclosure 4. Both 1 and 3 are correct
4
The listing broker has presented an offer to the sellers who accept the offer. At that moment the broker receives a call stating that the offer is withdrawn 1. The proposed contract is void 2. Since the seller accepted the contract it is valid 3. The buyers may withdraw the offer at any time 4. The buyers may withdraw the offer at any time, until they learn of acceptance
4
To determine if there is an encroachment a buyer would 1. Order an Improvement Location Certificate 2. Order a Survey 3. Order a Home Inspection 4. Both 1 and 2 are correct
4
A licensee will be put on probation for all of the following EXCEPT 1. keeping earnest money in a title company's trust account. 2. acting for more than one party without all parties' acknowledgment. 3. keeping earnest money in the broker's main checking account. 4. giving a "referral fee" to a non- licensee employee who only "shows" properties for sale.
1
A time share estate can be considered "Real Property" in the state of Colorado. 1. True. 2. True only in the mountain areas. 3. True if they include the land below them. 4. False.
1
You may refuse to rent to a disabled person if 1. the disabled person demands you make reasonable modifications at your cost. 2. the disabled person demands you let her/him make reasonable modifications at her/his cost. 3. the disabled person is just too disabled. 4. the building is an apartment building with no access for wheel chairs.
1
When a broker associate leaves one real estate company for another 1. the listings created by the broker associate go with him/her to the new company. 2. the listings created by the broker associate stay with the first company. 3. the "sales" currently held by the broker associate are moved to the new company. 4. the broker associate cannot leave for the new company until all current sales are completed.
2
You are a buyer's agent, and a buyer directs you to keep looking for properties after making an offer. 1. Your contract states you will not continue looking for property when the buyer makes an offer. 2. Your contract states you will not continue looking for property after the buyer's offer is accepted. 3. There is no problem with looking for another property as the buyer can get out of the present contract using the inspection clause. 4. It's up to you whether you want to continue looking for properties as it really doesn't matter.
2
Which of the following people may not write a prepared addendum for the Commission- approved Buy and Sell contract 1. Seller's Attorney 2. Buyer's Attorney 3. Principal party to the transaction 4. Broker who is acting as an agent
4
A licensee working with a tenant as a tenant agent 1. must use a Commission approved Exclusive Tenant Contract 2. is not required to complete any paperwork as there is no Commission approved tenant agent form. 3. may help the tenant find a rental, but cannot charge a fee for assisting. 4. the fee owed by tenant cannot be greater than 10% of the gross lease.
1
A listing broker can be vicariously liable for the statements of the seller 1. True 2. False
1
A seller may give permission to a real estate broker to disclose seller's motivating factors to buyers. 1. True 2. False
1
A transaction broker may not pay 1. a referral fee to a lender. 2. a co-op fee to another real estate agent. 3. a referral fee to another real estate agent. 4. any of the above.
1
Brokers are not allowed to use forms created by the seller's or buyer's attorney. 1. False. 2. False, except for notes, deeds of trust, and deeds. 3. True. 4. True, if the broker is a buyer's agent and the seller's attorney prepared the document.
1
If a broker has a buyer and seller sign a purchase contract that is no longer the current Commission approved form the contract is
1
If a buyer does not wish to work with a licensee as either an agent or a TB the buyer would be considered 1. a customer 2. a client 3. a person who can only buy from "For Sale by Owners" 4. a non buyer
1
It is possible for the public to get the address and number of a licensee from the Real Estate Commission. 1. True 2. False
1
Leases and mortgages must be in writing 1. if longer than one year. 2. if exactly one year or less. 3. to be enforceable. 4. if greater than six months and the property is a commercial property.
1
The Colorado Common Interest Ownership Act standardized the following actions 1. Gives power to the association to create a lien on the property if association dues are not paid. 2. Gives power to the association to enter a property in disrepair and make repairs. 3. Gives power to the association to maintain an owner occupancy ratio that meets the needs of lenders. 4. Gives power to the association to sue on behalf of the lenders.
1
The Real Estate Commission agrees with H.U.D. concerning the right of agents to give referral fees. 1. True 2. False
1
The number of hours of continuing education you must complete to renew your license every three years is 1. 24 2. 16 3. 8 4. 36
1
The real estate recovery fund is maintained by 1. the State Treasurer. 2. the Real Estate Commission. 3. the State Judiciary. 4. the State Legislature.
1
The recovery fund could be used for 1. payment of out-of-pocket losses and reasonable attorney fees to the public in civil suits against licensees. 2. payment of out-of-pocket losses and reasonable attorney fees to the public in criminal suits against licensees. 3. negligence even if the licensee has errors and omissions insurance coverage. 4. all of the above.
1
Using their best judgment, Brokers are allowed to "fill in the blanks" on non- commission approved pre-printed forms like warranty deeds and leases. 1. True 2. False
1
When the public enters into a brokerage relationship, the relationship is 1. only with the designated broker 2. only with the designated broker and the broker's company 3. only with the designated broker and the employing broker 4. only with the brokers of the designated company
1
When you get a real estate license, the public may hold you accountable for having as reasonable skill as they would a real estate licensee who has been practicing for 10 years. 1. True. 2. False.
1
You are found to be a transaction-broker when 1. you do not have a written agreement with a buyer or seller. 2. when you act as a limited agent. 3. Both (1) and (2) 4. Neither (1) or (2)
1
What language must be stated in Addendums (not commission approved) to contracts? 1. "Buyer and Seller acknowledge that the specific expertise of the brokers and their agents is limited to the conduct and completion of real estate transactions." 2. "This addendum has not been approved by the Colorado Real Estate Commission. It was prepared by (insert licensed name of broker or brokerage firm)." 3. The broker is practicing law and it is advised that Seller/Buyer seek legal advice. 4. Both (1) and (2) must be included.
2
It is true that: 1. a seller's agent will be held vicariously liable for statements made by the principal. 2. a seller can be held vicariously liable for some acts of a transaction- broker. 3. a seller will not be held vicariously liable for unauthorized acts of its agent. 4. a buyer will be held vicariously liable for the unauthorized acts of its agent.
3
The Americans with Disabilities Act affects real estate brokers in all of the following EXCEPT 1. By stating architectural barriers will be removed. 2. Making services available to persons with disabilities within their procedures and policies manual. 3. For companies of ten brokers or more, to have at least one van that is retrofitted for wheel chair use. 4. The absence of auxiliary aids does not create an environment that would exclude those with disabilities.
3
The Commission position on earnest money deposits states that 1. the broker must release all monies to buyer if the contract does not close. 2. the broker must hold all monies in a trust account until a written agreement is made between all parties concerning the release of the earnest money. 3. if transaction fails to consummate and there is no dispute, earnest money should be returned to buyer without seller's written authorization. 4. the broker must release the earnest monies to the seller if the buyer does not show up at closing.
3
The Real Estate Commission requires an office policy manual to cover all the following except 1. handling back-up contracts. 2. brokerage relationships. 3. commission splits. 4. fair housing/affirmative action marketing.
3
The written disclosure of brokerage relationships 1. must be signed by the individual the licensee plans to work with. 2. is a binding contract and therefore must be signed by the licensee and the customer/client. 3. must have a signature line for the customer/client to sign. 4. both (1) & (2)
3
There are ____ Colorado real estate commissioners who are appointed by the ________ 1. 3, Governor. 2. 5, state legislature. 3. 5, Governor. 4. 7, Governor.
3
Under what circumstances may the buyer be held vicariously liable for the acts of his agent? 1. Under no circumstances. 2. When the buyer broker is acting under the directions of the seller. 3. When the buyer broker is acting under the directions of the buyer. 4. When the buyer is out of town.
3
Which of the following is true: 1. Only Firm Name, Address and Phone Number may be added to the Commission- approved forms. 2. Only Firm Name, Address, Phone Number and email address may be added to the Commission-approved forms. 3. Only Firm Name, Address, Phone Number, Email address and Trademark may be added to the Commission-approved forms. 4. Only Firm Name, Address, Phone Number, Email address,Trademark and other identifying information may be added to the Commission-approved forms.
4
Which of the following would NOT have an obligation to inform the seller of buyer's financial inability to perform the contract? 1. Transaction-broker, if known. 2. Buyer's agent, if known. 3. Seller's agent, if known. 4. Lender.
4
Who of the following must be warned that they could be vicariously liable for your actions? 1. Customer of a transaction-broker. 2. Client of buyer broker. 3. Client of listing agent. 4. Both (2) & (3).
4
You are a buyer's agent with two clients with similar wants. You have appointments to show a property to Buyer A in the morning and the same property to Buyer B in the afternoon. Buyer A decides to make an offer on the property. 1. Since you are a buyer agent for A, you remove the property from the list to show buyer B. 2. Your contract with buyer A allows you to show the property to buyer B. 3. You are in an uncomfortable position and should keep all parties informed when there is interest in a property. 4. Both (2) and (3) are true.
4
Title companies 1. do prepare legal documents, such as deeds, for brokers. 2. who prepare legal documents for brokers, such as deeds, violate the law. 3. brokers are legally responsible for any mistakes made on a deed that was prepared by a title company. 4. 1 and 3 are correct.
4
To promote the interests of the seller, the agent must 1. seek acceptable terms and prices. 2. disclose, counsel and advise. 3. take care of accounting and inform of the possibility of vicarious liability. 4. All of the above.
4
A licensee must 1. offer all forms of brokerage relationship to potential clients/customers. 2. disclose all forms of brokerage relationship to potential clients/customers. 3. create a transaction-broker relationship in writing. 4. disclose those brokerage relationships identified in office policy along with a statement that different brokerage relationships are available.
4
A sales commission is due to the broker with an Exclusive Right to Sell Listing Contract 1. when the property sells. 2. when a ready and willing and able buyer has made an offer that meets the terms in the Seller's listing agreement and the seller decides not to sell. 3. if the property is found to have title defects which make it not saleable. 4. (1) and (2) are true.
4
Of the following, who must warn a buyer about psychologically impacted properties? 1. Customer of a transaction-broker. 2. Client of a buyer agent. 3. Client of a listing agent. 4. None of the above
4
The buyer's broker signs the Contract to Buy and Sell 1. As a party to the contract 2. As a receipt for earnest money 3. In order to ensure the proper commission percentage 4. To help the closing company prepare the documents
2
The following material information may be withheld from the buyer: 1. A leaking roof that has been painted over so no one can see it. 2. You will find water in the basement which only occurs in very,very heavy rains and heavy rains are very rare. 3. Foundation work which corrected the problem. 4. None of the above.
4
The Uniform Power of Attorney Act was created to 1. Empower real estate brokers to act for their principal without the principal's consent. 2. Ensure to third parties that they can rely upon the actions of the agent (who is created by the power of attorney). 3. Give spouses the right to sign for each other. 4. Allow parents to buy and sell real estate in their children's name.
2
The act of paying you a commission to sell a house makes you an agent of the payer 1. true 2. false
2
You must renew your license every 1. year. 2. every 2 years. 3. every 3 years. 4. every 6 years.
3
.The maximum civil penalty for a first offense concerning housing discrimination is 1. a warning and/or $1,000.00 fine. 2. $10,000.00 fine 3. $25,000.00 fine. 4. $50,000.00 fine.
2
A broker 1. shall be required to offer or engage in any one or in all of the brokerage relationships enumerated in the brokerage relationships disclosure form. 2. shall not be required to offer or engage in any one or in all of the brokerage relationships enumerated in the brokerage relationships disclosure form. 3. shall only disclose to potential customers/clients the types of brokerage relationships the broker is willing to perform. 4. (1) or (3)
2
A broker is not required to verify statements made by an independent inspector of property. Therefore, if the broker has actual knowledge that differs with the inspector's findings, the broker does not have to make known his/her actual knowledge. 1. True 2. False
2
A state-run program where real estate license fees are used in part to pay non- collectible judgments against licensees is a 1. bonding program. 2. recovery fund. 3. Both (1) and (2). 4. None of the above.
2
A subdivision is created if 1. a residential property is divided into more than 15 real property interests. 2. a residential property is divided into more than 20 real property interests. 3. a commercial property is divided into more than 20 real property interests. 4. a residential property is divided into more than 20 real property interests excluding time-share interests.
2
A transaction-broker working with both seller and buyer in the same transaction must advise each party what fees each should include in the contract. 1. True 2. False
2
An initial license issued to a broker will be 1. for the remainder of the current year, expiring on December 31st 2. for a 3-year period commencing on the issuance date 3. for a 1-year period commencing on the issuance date 4. for 3 years expiring on December 31st
2
At the time of closing, the commission check can be made out to 1. the licensee if the employing broker states that it is ok. 2. to the brokerage company (employing broker). 3. to both the brokerage company and the licensee. 4. all of the above are true.
2
Compensation is the major consideration for determining agency. 1. True 2. False
2
Corporations or businesses that are private clubs do not fall under the Colorado Fair Housing Act if 1. their business to supply housing is less than 30%. 2. the supply of housing is not part of their commercial purpose. 3. their main business activity is the housing of just members. 4. all housing falls under the Colorado Fair Housing Act.
2
Guide dogs must be allowed in all public places. 1. True except for recreation centers. 2. True. 3. False except for outdoor public places. 4. False.
2
If a buyer agent sells a company listing 1. the brokerage relationship must become either a dual agent or transaction- broker. 2. the broker has a fiduciary duty to try and negotiate the best price for the buyer. 3. the broker becomes a dual agent. 4. the broker will have violated Real Estate Commission laws.
2
In the Colorado Bar Association versus the Title Guaranty Company 1. the court ruled that title companies, like real estate brokers, could prepare legal documents for others. 2. the court ruled that title companies, unlike real estate brokers, could not prepare legal documents for others. 3. the court ruled that title companies could prepare only notes and deeds of trust for others. 4. the court ruled that title companies may give limited legal advice.
2
It is true that the 1. licensees must prepare all real estate documents for closing. 2. licensees must bear the cost of legal documents that the licensee has prepared by attorneys. 3. licensees may charge the party for whom the legal documents were prepared. 4. sellers cannot hire an attorney to prepare the deed.
2
Lenders can hire brokers to prepare an opinion of value which will be used to determine the buyer's loan ratios. 1. True. 2. False.
2
The Colorado Fair Housing Act does not apply to 1. owners renting out their own personal residence. 2. owners renting out a room in their personal home. 3. real estate agents from other states. 4. housing created solely for persons 55 or older.
2
The purchase contract states that the buyer may select financing appropriate and acceptable to Buyer, including a different loan than initially sought. If the buyer cannot get the original loan 1. the contract is automatically terminated. 2. the contract may be terminated by purchaser. 3. the purchaser did not contract in good faith. 4. the seller gets the earnest money.
2
All of the following are true EXCEPT: 1. The employing broker is normally the supervisor of the transaction. 2. The employing broker may designate him or herself as agent of the seller. 3. The listing broker must always work with a buyer as a customer. 4. The seller and the listing broker are the only parties in the brokerage relationship.
3
Brokers are allowed to charge the buyers and/or sellers for closing costs that do not include "document preparation". 1. Always. 2. only if the sellers and buyers agree, either orally or in writing, to be charged. 3. only if the sellers and buyers agree, in writing, to be charged. 4. Never
3
If a seller refuses to sell and pay a commission to the broker, the broker should 1. record a listing contract that is in dispute. 2. advise buyers to record their purchase contracts. 3. go to court to prove a claim. 4. advise sellers concerning their rights in listing contracts.
3
If you practice real estate without a license you will be prosecuted by 1. the sheriff. 2. the attorney general. 3. a district attorney. 4. the Real Estate Commission.
3
It is a good business practice for a transaction-broker to let 1. the buyer know why the seller is selling. 2. the seller know why the buyer is buying. 3. both parties see a CMA if one party requests a CMA. 4. All of the above.
3
All of the following are considered unfair housing practices except 1. having an oral inquiry concerning the number of children in the family. 2. writing an ad that states "difficult for wheel chairs." 3. stating in an ad that the area is a "preferred area" for people who like to speak more than one language. 4. an ad that states, "college students need not apply."
4
An employing broker does all of the following except 1. maintain trust accounts. 2. develop an office policy manual. 3. high level of supervision for brokers who have been in the business for less than 2 years. 4. give the seller earnest money when the seller asks for its release.
4
Concerning psychologically impacted properties, which of the following statements is correct? 1. Customers of a transaction-broker must be told about the psychologically impacted property. 2. Clients of a buyer agent must be told about psychologically impacted properties. 3. Clients of a listing agent must disclose information about psychologically impacted properties. 4. Clients of a listing agent are not required to disclose information concerning psychologically impacted properties.
4
Does Colorado law dictate the ethical standards for the real estate industry? 1. Indirectly. 2. Indirectly through public wrongs (the law of crimes). 3. Indirectly through private wrongs (the law of torts). 4. All of the above.
4
If a licensee has knowledge that the buyer may not have financial ability to purchase a home, which of the following licensees must notify the seller of this fact? 1. Buyer agent. 2. Transaction-broker. 3. Seller's agent. 4. All of the above.
4
If the agreement by which the broker was engaged is not performed or completed for any reason, the relationship shall end no later than 1. 3 months after the date of the engagement. 2. 6 months after the date of the engagement. 3. 9 months after the date of the engagement. 4. 1 year after the date of the engagement.
4
If you own a motel 1. you are bound by the Real Estate Commission rules on trust accounts. 2. the agreement you have with customers is a lease. 3. you are required to have a real estate license. 4. owning a motel does not require a real estate license.
4
The Cash at Closing figure in the Price and Terms section of the Contract to Buy and Sell 1. Is the amount the buyer will bring to closing 2. Is the difference between the purchase price and money listed from various sources 3. Does not include loan costs and other possible buyer's closing costs 4. Both 2 and 3 are correct
4
The Colorado Common Interest Ownership Act includes all of the following EXCEPT 1. condominiums. 2. cooperatives. 3. subdivisions with common interest ownership of pools and tennis courts. 4. trailer parks.
4
The Colorado Fair Housing Act prohibits discrimination based on some of the following EXCEPT 1. race 2. marital status 3. sex 4. age
4
The Real Estate Commission has the power to 1. audit all brokers, but must make an appointment. 2. audit all files and may show up without an appointment. 3. investigate all licensees without any complaints made against the licensee. 4. (2) and (3) are both true.
4
The __________________ determines the relationship between the public and the employed brokers. 1. The owner of the company. 2. The Real Estate Commission of Colorado. 3. The buyer or the seller. 4. The employing broker.
4
The following are duties and obligations of a single agent: 1. Perform the terms of the written agreement while exercising reasonable skill and care. 2. Promote the interests of the principal and comply with license law requirements. 3. Comply with federal, state, and local laws, rules and regulations. 4. All of the above.
4
The following is true EXCEPT 1. listing contracts can be assigned, with the consent of the owner, to another company if the listing company goes out of business. 2. you must have a real estate license to sell a modular home that is attached to land. 3. your license becomes inactive if you do not have errors and omissions insurance. 4. having a company logo and address on the body of the purchase contract makes the logo and address a legal part of the contract and may be countered.
4
The reasoning behind the creation of the "single licensing law" was 1. to bring the law in line with actual practice. 2. to stop the practice of a new real estate broker working independently, as their own company. 3. to stop the practice of real estate brokers overseeing newly licensees. 4. (1) & (2) are both true.
4
Under which of the following circumstances could a listing agent's license be subject to revocation, suspension or reprimand by the Real Estate Division? 1. Marketing a home without a listing agreement. 2. Failing to give copies to each person who signs a document. 3. Representing both parties on the same sale and not mentioning this fact to either of the parties involved. 4. All of the above.
4
When may a transaction-broker act as an agent for a seller or buyer? 1. When selling an in-house listing to the buyer. 2. When negotiating an offer between both buyer and seller. 3. When the buyer or seller checks the box in the employment agreement allowing this change during the contract term. 4. When single agency is created in writing, ending a transaction-broker relationship.
4
Which of the following has fiduciary duties? 1. Transaction-broker 2. Buyer's agent 3. Seller's agent 4. (2) & (3) are both true.
4
