Exam 2 Set 2

A buyer is purchasing a property for $400,000. His lender's loan-to-value ratio is 80%. How much is the buyer financing? a. $320,000 b. $360,000 c. $400,000 d. $80,000

a. $320,000

Harmony is looking at the legal description on her purchase contract. It mentions that the plat of her property is recorded in Map Book 12, page 14, at the county courthouse. What type of legal description is this? a. Lot and block b. Metes and bounds c. Monument and benchmark d. Rectangular government survey

a. Lot and block

In which of these situations did the licensee breach the fiduciary duty of loyalty? a. Margo tells her seller client Troy that his property is worth less than it really is so he will get a quick sale. b. Michael submits all offers he receives on Jarrod's property. c. Steven postponed his vacation so he could attend his seller client's closing. d. Tanaka refuses to encourage his seller client to lower his asking price.

a. Margo tells her seller client Troy that his property is worth less than it really is so he will get a quick sale.

A family of four, with children ages six and nine, is denied the opportunity to view an available unit at a community that caters to seniors. Which of the following statements is true? a. The federal Fair Housing Act allows an exemption for communities that are designed and operated for senior use. b. The federal Fair Housing Act allows an exemption for communities that don't have playgrounds or play areas for children. c. This is a violation of the federal Fair Housing Act because it discriminates on the basis of age. d. This is a violation of the federal Fair Housing Act because it discriminates on the basis of familial status.

a. The federal Fair Housing Act allows an exemption for communities that are designed and operated for senior use.

Phoebe's gross monthly income is $4,200, and she has $360 in monthly non-housing debt payments. The lender's qualifying ratios are 28% for the housing ratio and 36% for the total DTI ratio. What's the maximum housing payment she can afford? a. $1,075 b. $1,152 c. $1,176 d. $1,512

b. $1,152

Michael paid $385,000 for his home, which now has an assessed value of $392,000. His tax rate is 0.51%. How much with his monthly taxes be? a. 163.62 b. $166.60 c. $186.52 d. $297.50

b. $166.60

Roland's farm land is assessed at 1.5 million dollars and the improvements for $500,000. At a tax rate of 4 mills, how much are Rolan's monthly taxes? a. $6,667.00 b. $667.00 c. $8,000.00 d. $80,000.00

b. $667.00

Sebastien's four-story home includes a 400-square-foot unfinished bonus room on the top floor, an upper level with 850 square feet, a main level with 1,450 square feet (which includes a garage that's 500 square feet), and a finished basement that's 900 square feet. The MLS system in Sebastien's area includes below-grade square footage. What square footage will be reported on his MLS listing? a. 2,200 b. 2,700 c. 3,600 d. 4,100

b. 2,700

Camille, a buyer, wants to change the price already agreed to in a sales contract. What document should she use? a. Addendum b. Amendment c. Bill of sale d. New contract

b. Amendment

What are improvements with regard to property? a. Another name for a building permit b. Artificial attachments to land that include items such as fencing, buildings, and walkways c. Natural fixtures that are part of the land and that enhance its value d. The right to increase the value of a property

b. Artificial attachments to land that include items such as fencing, buildings, and walkways

Which of the following is an example of a universal agent? a. Buyer's agent b. Conservator c. Escrow officer d. Listing agent

b. Conservator

Which of the following is a common problem with roof shingles? a. Clean fascia b. Discoloration or curling c. Soffit without holes d. Water buildup and ice damming

b. Discoloration or curling

The doctrine of laches refers to the _______ of restrictive covenants/deed restrictions. a. Creation b. Enforcement c. History d. Types

b. Enforcement

Jerry and Lewis have entered into a sales contract. They're about three weeks into the transaction, with several terms of the agreement yet to be met. What type of contract do Jerry and Lewis have? a. Executed b. Executory c. Option d. Unilateral

b. Executory

Goldie and Kurt are looking at purchasing their first home. Their credit history is a little shaky and they don't have enough money saved to put down 20%. What type of loan seems most appropriate? a. Conventional b. FHA c. FHA, VA, or conventional d. VA

b. FHA

Which of the following describes the amount a lender charges a borrower for using money? a. Discount point b. Interest c. Principal d. Usury

b. Interest

New Day Corporation's application to build a new mixed-income housing development was denied, because the town of Springfield has halted all new development until after city elections. What did Springfield enact? a. Area variance b. Moratorium c. Special use permit d. Use variance

b. Moratorium

Alan and Kate want to build a 5,000-square-foot ranch-style home on two acres of land they just bought. Once the house is built, how many acres of undeveloped land will remain? a. 0.88 acres b. 0.89 acres c. 1.86 acres d. 1.89 acres

d. 1.89 acres

Recently retired Admiral Bongo and his wife, Lucy, contact you. They want you to help them purchase their dream house now that he's retired, but one that has the necessary accommodations for the admiral's disability. They also confide in you that they don't have a lot of money saved up for a down payment. Which type of financing may work best for them? a. A conventional loan combined with a seller carry back. b. A conventional loan using the admiral's retirement money as a down payment. c. An FHA 203(k) loan to fix their new home up. d. A VA loan, which requires no down payment.

d. A VA loan, which requires no down payment.

Ken, Barbie, and Skipper owned a property as a joint tenancy. When Skipper moved out of state, she sold her interest to Midge. Two years later, Ken died. How is the interest in the property divided? a. Barbie and Midge each own 50%. b. Barbie and Skipper each own 50%. c. Barbie, Midge, and Ken's heirs each own one-third. d. Barbie owns two-thirds, and Midge owns one-third.

d. Barbie owns two-thirds, and Midge owns one-third.

Hannah wasn't able to get the financing to open her boutique, so her mother came on as a silent partner and provided additional cash. Hannah and her mother have an agreement that states Hannah's mother can't be held financially or legally liable if there are any problems with the store. What type of contract clause is this? a. Arbitration b. Choice of law c. Damages block d. Indemnification

d. Indemnification

Nate represents Elena in the purchase of a house. Katherine represents the seller, Timothy. Which of the following statements accurately reflects the agency duties owed? a. Each licensee owes all fiduciary duties to both clients. b. Katherine owes Elena the duty of loyalty. c. Nate owes no duties to Timothy, and Katherine owes no duties to Elena. d. Nate owes Timothy the duty of disclosure.

d. Nate owes Timothy the duty of disclosure.

Which one of the following statements about asbestos is true? a. Homeowners can safely remove it. b. It's harmful only if left in place. c. It's not harmful at low levels. d. No amount of it is considered safe.

d. No amount of it is considered safe.

The best way to start comparative market analysis data collection is to use properties that sold when? a. 18 to 24 months ago b. Between two and three years ago c. In the last 12 to 18 months d. No later than three to six months ago

d. No later than three to six months ago

Which of the following is an advantage of condominium ownership? a. No HOA dues b. No neighbors c. No shared walls d. No yard work

d. No yard work

A client has asked her agent for a 24-hour notice on showings. The agent knows this will have a negative impact on the number of showings. Which duty is in conflict with reasonable skill and care? a. Accounting b. Confidentiality c. Disclosure d. Obedience

d. Obedience

Tristan refused to let Marla list his property on the MLS, even though Marla told him that more exposure to the property would generate more potential buyers. Which two fiduciary duties are at odds in this situation? a. Loyalty and confidentiality b. Loyalty and reasonable skill and care c. Reasonable skill and care and confidentiality d. Reasonable skill and care and obedience

d. Reasonable skill and care and obedience

The question, "What's the purpose of this appraisal?" can be answered by this first step of the appraisal process. a. Determine highest and best use. b. Estimate land value. c. Identify data needed. d. State the problem.

d. State the problem.

Allentown sits on the river, and its many bridges need repair. Which police power is Allentown likely to use in order to fund improvements to its bridges? a. Condemnation b. Escheat c. Taking d. Taxation

d. Taxation

When purchasing a short sale or foreclosure, what's one of the biggest frustrations buyers face? a. Insurance companies' refusal to insure homes sold as distressed properties b. Restrictions on the amount a lender will finance on a distressed property c. The difficulty of finding a real estate professional to help them with the purchase. d. The length of time it takes to purchase a distressed property

d. The length of time it takes to purchase a distressed property

Which of these situations would be exempt from most provisions of the federal Fair Housing Act? a. A homeowner engages a real estate professional to rent out his basement apartment. b. An investor owns and rents out five duplexes. c. A non-profit owns 20 properties that it only rents to Caucasian families. d. The local Elks club owns a property that's rented only to Elks club members.

d. The local Elks club owns a property that's rented only to Elks club members.

What is the purpose of earnest money? a. To encourage the seller to come down in the asking price for the property b. To provide the seller with funds to make required repairs to the property before selling it c. To retain the services of a licensee d. To show the seller that the buyer is serious and intends to go through with the sale

d. To show the seller that the buyer is serious and intends to go through with the sale

Assuming that dual agency is legal where these scenarios occur and that the licensees' brokerages permit it, which of these situations demonstrates illegal dual agency? a. Jarrod represents the seller, Juan. A buyer, Alaina, approaches Jarrod about representing her in the purchase of Juan's house. Jarrod obtains Juan and Alaina's consent to dual agency. b. Kady's firm uses representation agreements that, when signed, provide consent to dual licensee dual agency. Kady's buyer makes an offer on one of Kady's colleague's listings. c. Levi's customer, Renee, wants to make an offer on Levi's seller client's home. Levi presents Renee's offer to his client. d. Tom is holding an open house for his client. Ruby, a buyer, says she wants to make an offer. She details her situation; Tom waits until she finishes and then suggests that she offer a non-refundable earnest money deposit to strengthen her offer.

d. Tom is holding an open house for his client. Ruby, a buyer, says she wants to make an offer. She details her situation; Tom waits until she finishes and then suggests that she offer a non-refundable earnest money deposit to strengthen her offer.

Which of these was enacted to give electronic signatures, records, and contracts legal recognition equal to that of paper records and signatures? a. Federal Real Estate License Act b. Statute of frauds c. Statute of limitations d. Uniform Electronic Transactions Act

d. Uniform Electronic Transactions Act

Unauthorized practice of law and acting outside the scope of one's expertise are similar issues. Which of the following circumstances specifically relates to the unauthorized practice of law? a. Predicting a specific tax increase or decrease b. Predicting the return on investment for a rental property c. Recommending specific investments d. Writing contract addenda or additional provisions that cover unfamiliar circumstances

d. Writing contract addenda or additional provisions that cover unfamiliar circumstances

Your client is purchasing a single-family home with a VA-guaranteed loan. The listing price is $150,000. Is an appraisal by a certified appraiser required? a. It's at the buyer's discretion. b. No, since the buyer is using a VA loan. c. No, since the sales price is less than $400,000. d. Yes, and since the purchase is financed with a VA-guaranteed loan, the appraiser must be VA certified.

d. Yes, and since the purchase is financed with a VA-guaranteed loan, the appraiser must be VA certified.

John and Amy purchased a builder's home warranty when they bought their home. They have found structural damage that could be a detriment to their home. On average, how many years does a home warranty cover structural damage? a. 10 years b. Five years c. One year d. Three years

a. 10 years

Which of the following is a way in which property taxes could impact your clients? a. A sale in the area may prompt a reassessment, impacting new buyers. b. Neighbors may be jealous about favorable tax rates. c. Tax abatements could harm buyers financially. d. Tax refunds are not possible if property tax deductions are taken.

a. A sale in the area may prompt a reassessment, impacting new buyers.

You're explaining to your client that using electronic documents and signatures simplifies the home buying process. Your client is skeptical about these signatures. You describe the Uniform Electronic Transactions Act (UETA) and tell your client ______. a. The UETA gives electronic signatures the same legal weight as "wet" signatures b. The UETA provides a guarantee that electronic signatures will hold up in court c. The UETA requires states to permit electronic signatures on all real estate-related documents d. UETA takes precedence over state laws

a. The UETA gives electronic signatures the same legal weight as "wet" signatures

A seller tells his agent that he has to sell his house quickly because of a divorce proceeding and that he's willing to accept less than his list price. His agent tells a buyer that the seller will accept as much as $10,000 less than the list price. Which of these is true? a. The agent has breached his duty of confidentiality to his client. b. The agent hasn't violated any fiduciary responsibilities to his client. c. The buyer is prohibited from making an offer because of the agent's breach of confidentiality. d. Unless the agent has the seller's permission to share this information, the agent should have disclosed only that the seller is willing to reduce his price, not the amount.

a. The agent has breached his duty of confidentiality to his client.

Roxanne just finished making a buyer presentation to Fred and Regina Jones. Now that they understand the difference between being customers and being clients, they're anxious to be represented. What is one of Roxanne's duties to them as their buyer's agent? a. Ensuring that she earns a commission b. Finding properties to show to Fred and Regina c. Notifying the Jones family of any material changes d. Sharing their motivations and pricing strategies with seller's agents.

b. Finding properties to show to Fred and Regina

Chad, a landlord, made a pass at one of his tenants. She refused his advances, and her rent increased the following month. The other tenants didn't receive a rent increase. How did Chad violate fair housing law? a. He created special terms for a tenant based on familial status. b. He created special terms for a tenant based on sex. c. He refused to make reasonable accommodations for a tenant who is disabled. d. He refused to rent to an applicant based on sex.

b. He created special terms for a tenant based on sex.

Which clause in a contract states that one or more parties won't be held liable if there are losses or expenses related to the contract? a. Choice of law clause b. Indemnification clause c. Severability clause d. Time of performance clause

b. Indemnification clause

Morris needs to pay for some repairs made to one of the units in his apartment complex. Which bank account should he use? a. He can use either the trust account or the operating account b. The firm's operating account c. The operating account for that specific unit d. The trust account for that specific unit

b. The firm's operating account

A buyer has a 30-year, $750,000 loan with a 5.75% interest rate. How much of the first monthly payment is interest? a. $10,869.57 b. $3,500.93 c. $3,593.75 d. $3,750.27

c. $3,593.75

Sander and Ginny bought an old industrial site and plan to get grant money to put an environmental education center on the site. There are a few structures on the property, but they are in disrepair, and it will likely be less expensive to tear them down and build new than to rehabilitate them. However, the new owners are sure that they've made a great investment because the land is in great shape. This reflects which physical characteristic of real property? a. Immobility b. Improvements c. Indestructibility d. Uniqueness

c. Indestructibility

Which option is of the most concern to licensees and advertising when it comes to the Federal Trade Commission? a. Excessive advertising costs b. Location of ads c. Misleading ads d. Paper waste

c. Misleading ads

Because there were no deadlines specified in the contract, Myron didn't think there was a problem with his waiting to apply for a loan to help purchase the property. He was therefore a little surprised and not very happy when the seller sued him for breach of contract, stating that the delay was impacting the seller's ability to purchase a new home. What did Myron fail to do? a. Complete his loan application correctly. b. Notify the seller that he had a loan contingency. c. Perform his contractual obligations within a reasonable time. d. Talk to the seller about the seller's contingency to sell his house in order to buy another property.

c. Perform his contractual obligations within a reasonable time.

Harini had a lease with an option to buy on her condo since she wasn't financially stable enough to purchase the condo when she first signed the lease. Two years later Harini was in great financial shape, but she found out that the owner legally sold the condo to another buyer. Harini has to move out next month. What must have happened? a. Harini and the seller had a falling out. b. Harini exercised her right of first refusal. c. The option expired. d. The seller breached the contract.

c. The option expired.

Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 states that its purpose, in part, is to require that real estate appraisals used in connection with federally related transactions be performed ______. a. By licensed real estate professionals b. By members of the Appraisal Foundation c. In the most expeditious and inexpensive way possible d. In writing, and in accordance with uniform standards

d. In writing, and in accordance with uniform standards

Richard is interested in purchasing some rural land and included outbuildings. When reviewing the legal description, he sees the name of a principal meridian. What type of legal description is this? a. Lot and block b. Metes and bounds c. Monument and benchmark d. Rectangular government survey

d. Rectangular government survey

If a buyer makes an offer that the seller finds lacking, which of the following actions is the seller most likely to take? a. Ask the seller's agent to talk with the buyer's agent. b. Call the buyer to negotiate better terms. c. Increase the asking price. d. Respond with a written counter-offer.

d. Respond with a written counter-offer.

For farmers and others who live in rural communities, a ______ loan may be available. One benefit of these loans is the option for a longer payback period. a. Farm-to-closing-table b. Fresh farmers c. Organic producers d. Rural development

d. Rural development

In full seller disclosure states, whose responsibility is it to fully disclose all items on a seller disclosure form and any known material defects not listed on the form? a. Appraiser b. Buyer c. Lender d. Seller

d. Seller

The appraisal report submitted to Jenkins, the lender, notes that the property is being conveyed with all property rights intact. Which step in the appraisal process does this represent? a. Determine highest and best use. b. Estimate the land value. c. Gather and analyze data. d. State the problem.

d. State the problem.

Latrell purchased an old warehouse with the intent to create shared studio space for artists. However, he didn't perform due diligence before the purchase, and it turns out that there are hazardous materials that need to be cleaned up first. Latrell took the prior owners to court, and the court ruled that Latrell is responsible for the costs of cleanup. What kind of liability is this? a. Joint liability b. Retroactive liability c. Several liability d. Strict liability

d. Strict liability

In a real estate transaction in which you represent the seller, your duty to other parties is to ____________. a. Be honest in all matters that do not affect your client's interests b. Be polite and courteous c. Maintain the confidentiality of all matters that other parties disclose to you d.Treat them honestly and fairly

d. Treat them honestly and fairly

A lot measuring 108,900 square feet is for sale. How many acres is this? a. Five b. One c. Three d. Two and a half

d. Two and a half

Damien and Sandy bought a lot with a condemned house. They want to tear it down and build a duplex, so that they can live on one side and rent out the other. Unfortunately, the property is zoned single-family residential. If they can make a case for economic hardship, they may apply for and be granted a ________. a. Area variance b. Moratorium c. Special use permit d. Use variance

d. Use variance

Paul and Blake are touring an open house when they notice that the glass on the sliding patio door is very foggy. Is this a concern, and if so, why? a. No, this is not a concern, as it only indicates poor cleaning habits. b. No, this is not a concern as it's common in cold climates. c. Yes, this could be a sign of fire damage. d. Yes, this is a sign of a leaky seal which reduces efficiency.

d. Yes, this is a sign of a leaky seal which reduces efficiency.

Jenna was surprised that the charming Tudor she was touring was still on the market. "I don't see anything bad on the disclosure," she told her agent, "and the price seems fine. Why do you think it hasn't sold?" Her agent Louise responded, "Well, I heard that UPS was opening a new air hub two miles away early next year." Why might this affect Jenna's or other buyers' interest in the property? a. A UPS hub would mean many more flights overhead each day. b. More UPS jobs would mean more housing competition. c. The city might raise property taxes once UPS moves in. d. With a UPS hub nearby, packages would be delivered more quickly.

a. A UPS hub would mean many more flights overhead each day.

Related to title insurance, what is "subrogation"? a. A covered party grants permission to the title company to pursue the party who caused a claim or loss. b. The act of conveyance when the seller turns over all property rights to the buyer with a clear, marketable title. c. The process by which the lender receives coverage under a title insurance policy the borrower has purchased. d. The process by which the title policy pays out any claims to the buyer or lender.

a. A covered party grants permission to the title company to pursue the party who caused a claim or loss.

Your buyers step outside to view the backyard of a property they're touring, but then they can't get the back door closed again. You recognize that this could be a symptom of ____, and realize that if they are interested in this property, they will want to discuss this issue with a home inspector. a. A foundation problem b. An HVAC problem c. Constant freezing and thawing d. Poor general maintenance on the home

a. A foundation problem

Lamar closes on his new home next week. It's a 37-year-old split level, so his agent asked if he's interested in purchasing a home warranty. "Why would I need a warranty?" he wondered. "Didn't the home inspection identify all of the issues?" What's the agent's best response to Lamar's question? a. A home warranty covers things the inspection didn't address, like appliances, as well as structural issues that occur. b. Buying a home warranty almost guarantees you won't have any issues! c. If you purchase a home warranty and something breaks, you can sue the seller. d. The inspection is only as good as the inspector, and there is no guarantee that the inspector found all potential issues.

a. A home warranty covers things the inspection didn't address, like appliances, as well as structural issues that occur.

Kenneth entered into a contract to sell his home to Valerie, who put down a $5,000 earnest money deposit. At the last minute, Valerie backed out of the deal and Kenneth kept the earnest deposit. This is an example of ______. a. Accepting liquidated damages b. Accepting partial performance c. Suing for damages d. Suing for specific performance

a. Accepting liquidated damages

The element of a deed that signifies the grantor's intention to transfer title to the grantee is the ______. a. Act of conveyance b. Consideration c. Evidence of title d. Transference clause

a. Act of conveyance

Allen and Lewis are friends who each recently purchased real estate. Allen purchased a patio home in a small town an hour from the city, while Lewis purchased a condo in a really hot area near the city center. Although they paid similar amounts for their properties, Lewis' condo is worth much more two years later. Which economic characteristic does this demonstrate? a. Area preference b. Improvements c. Permanence d. Scarcity

a. Area preference

When considering loan risk, which two items will lenders consider in equal measure? a. Borrower and property b. Credit and employment c. Debt and income d. Loan and value

a. Borrower and property

Why would a buyer want to know if any easements or encroachments exist on a property? a. Both easements and encroachments affect the property's lot size, enjoyment, and use, which can affect a property's value. b. Both easements and encroachments are illegal. The buyer could end up in court. c. The buyer may need this information to provide evidence for litigation. d. The buyer will have to remove these before the property can be re-sold.

a. Both easements and encroachments affect the property's lot size, enjoyment, and use, which can affect a property's value.

Which of the following is an action borrowers take to temporarily lower the interest rate on their mortgage loan? a. Buydown b. Down payment c. Gap financing d. Usury

a. Buydown

You're showing a house when you notice piles of what looks like sawdust outside near the basement windows. This may be evidence of which pest? a. Carpenter ants b. Fire ants c. Ladybugs d. Powder post beetles

a. Carpenter ants

Which act was the first to prohibit any exceptions for discrimination based on race or color? a. Civil Rights Act of 1866 b. Fair Housing Amendments Act of 1988 c. Federal Fair Housing Act of 1968 d. Housing for Older Persons Act of 1995

a. Civil Rights Act of 1866

Juan has finalized his comparables and is ready to determine a property's appraised value. How does he do this? a. He reviews his process and places more weight on the most similar comparables that he believes to be the most valid. b. He takes an average of the adjusted comparable values. c. He uses the highest adjusted value from his comparables. d. He uses the lowest adjusted value from his comparables.

a. He reviews his process and places more weight on the most similar comparables that he believes to be the most valid.

Celia was obtaining a conventional loan, and she put $50,000 down as a down payment. Why might her lender also require her to obtain private mortgage insurance? a. Her down payment of $50,000 isn't at least 20% of the purchase price. b. Her lender is a subprime lender. c. PMI is triggered at the $50,000 down payment amount. d. She has poor credit.

a. Her down payment of $50,000 isn't at least 20% of the purchase price.

In which of these situations is Ronna's fiduciary duty of reasonable skill and care at odds with her duty of obedience? a. Jefferson insists that Ronna interpret the implications of him breaching his contract with a buyer. b. Ronna's buyer client asked her to keep his financial situation confidential. c. Ted, Ronna's broker, insisted that she teach a contracts class, even though she's a new agent. d. Though her customer was adamant, Ronna turned down a commercial listing because it was outside her area of expertise.

a. Jefferson insists that Ronna interpret the implications of him breaching his contract with a buyer.

Zack represents a seller and receives an offer through another agent. The offer is higher than the listing price. The property is already listed at a very high price, and no other offers have been received. Is Zack obligated by his duties to the other party to disclose that the offer is too high? a. No, but Zack should honor his duty to all parties by asking his client to decline the offer. b. No, his fiduciary duty is to his own client. The buyer's agent must be responsible for advising on a fair price for the property. c. Yes, Zack must be honest and fair with all parties in the transaction. d. Zack can request that both parties consent to dual agency so that he can negotiate an honest price that will be fair to all.

b. No, his fiduciary duty is to his own client. The buyer's agent must be responsible for advising on a fair price for the property.

On what type of listing (or listings) may a net listing be used in states where they are legal? a. Exclusive right-to-sell listings only b. Open, exclusive agency, or exclusive right-to-sell listings c. Open listings only d. Open or exclusive agency listings only

b. Open, exclusive agency, or exclusive right-to-sell listings

Jerry and Simon signed a contract so that Jerry could purchase all of Simon's restaurant equipment for one price after Simon closes his restaurant next month. The contract contains a provision that states Jerry has one year from the purchase date to file a suit relative to the purchase. After the year is up, Jerry forfeits the right. What kind of contract clause is this? a. Specific time b. Statute of limitations c. Time is of the essence d. Time of performance

b. Statute of limitations

In which of the following listing agreement terminations is there LEAST likely to be a penalty for terminating the agreement? a. The agent abandons the listing. b. The client and agent mutually agree to terminate the listing. c. The client revokes the listing agreement to sell the property to a family member. d. The seller withdraws the listing, deciding instead to stay in the property.

b. The client and agent mutually agree to terminate the listing.

A seller wants to break even after the broker's commission of 5% and loan balance of $300,000 are paid. At what price must the house sell? a. $150,000 b. $300,000 c. $315,789 d. $450,000

c. $315,789

Whitney and Justin are about to close on their refinance, and their loan amount is $362,000. They are paying a 1.5% origination fee. How much will their origination fee be? a. $1,500 b. $5,100 c. $5,430 d. $6,200

c. $5,430

Alistair bought a townhouse for $285,900. He got a 90% loan and the lender charged him 3-1/2 discount points. How much did Alistair pay in discount points? a. $1,000.65 b. $10,006.50 c. $9,005.85 d. $9,585.00

c. $9,005.85

Related to real estate financing, how much is a point? a. $1 b. $10 c. 1% of loan value d. 1% of sale price

c. 1% of loan value

REALTOR® Arnold was instructed by his client Sebastian to find a buyer who would "fit into the neighborhood." What is Arnold's responsibility in this situation? a. Arnold must comply with his client's instruction, regardless of his own feelings on the subject. b. Arnold must conduct his usual advertising strategies and find covert methods for selecting buyers that meet his client's desired profile. c. Arnold must explain to his client the responsibilities for fair treatment that they both have under fair housing laws. d. Arnold must explain to Sebastian that he cannot continue to work as his agent under the circumstances.

c. Arnold must explain to his client the responsibilities for fair treatment that they both have under fair housing laws.

Specifically, what does the fiduciary duty of disclosure relate to? a. Adverse material facts and publicly recorded facts only b. Conflicts of interest and confidential information only c. Conflicts of interest, material facts, and adverse material facts d. Material facts and adverse material facts only

c. Conflicts of interest, material facts, and adverse material facts

Discoloration along walls and sagging or uneven floors can be signs of ______. a. Electrical issues b. Fire damage c. Flood damage d. Wind damage

c. Flood damage

What economic principle is related to a property's most profitable use that is both legal and economically feasible? a. Anticipation b. Contribution c. Highest and best use d. Progression

c. Highest and best use

Homestead Realty had a listing agreement with Gertrude. The listing expired, and Gertrude moved the listing to another firm. Another licensee at Homestead Realty has a buyer client who's interested in Gertrude's property. What restrictions are in place for Homestead Realty? a. Homestead may not represent a buyer for the previously listed property. b. Homestead may represent the buyer but may not disclose any information about the property or previous offers on it. c. Homestead may represent the buyer, must disclose material facts about the property, and must maintain Gertrude's confidentiality. d. No restrictions are in place since the previous property listing expired.

c. Homestead may represent the buyer, must disclose material facts about the property, and must maintain Gertrude's confidentiality.

Leo's client is looking for a property with at least 2,500 finished square feet. He finds a 2,200- square-foot property with all the other features the client is looking for and purposely fails to mention the square footage. His client agrees to look at the property, falls in love with it, and wants to make an offer. Which of these statements accurately represents Leo's level of misrepresentation in this situation? a. Because Leo didn't state the square footage, he's not guilty of misrepresentation. b. It's the buyer's responsibility to ensure that the property has the proper square footage, so Leo's in the clear. c. Leo obviously knew about the square footage and intentionally didn't mention it. He's guilty of intentional misrepresentation. d. Leo omitted a material fact. This is considered unintentional misrepresentation.

c. Leo obviously knew about the square footage and intentionally didn't mention it. He's guilty of intentional misrepresentation.

Sebastian owns a country house and vacations there every summer and on holiday weekends. As much as he'd like to will it to his niece when he passes, his ownership of the house ends when he dies. What type of estate does Sebastian own? a. Fee simple estate b. Free leasehold estate c. Life estate d. Remainder estate

c. Life estate

A calculation that describes the amount being borrowed compared to the value of a property is called ______ ratio. a. Appraisal b. Housing c. Loan-to-value d. Total debt

c. Loan-to-value

Marcus bought two adjoining pieces of land that were zoned for commercial use. When he realized that combining the two parcels would dramatically increase the land's value, he jumped at the opportunity. What's this an example of? a. Contribution b. Eminent domain c. Plottage d. Zoning

c. Plottage

Adams County implemented a 10 p.m. curfew for youths under age 18 because of the high number of fights that have been occurring late at night in public places. Which of the following gives Adams County the right to restrict the movements of its minor citizens? a. Doctrine of laches b. Municipal master plan c. Police power d. Power of escheat

c. Police power

Seller Gina feels awful that Martha, who was going to buy her property, lost her job. Gina decides to _________ Martha from the purchase contract. a. Assign b. Reform c. Release d. Rescind

c. Release

A requirement that all property owners in a subdivision have a six-foot privacy fence surrounding their entire property is an example of a _______, a. Deed b. Doctrine of laches c. Restrictive covenant d. Setback

c. Restrictive covenant

Betty hired a contractor to replace her gutters. Within days, the gutters leaked and flooded her basement. She complained to the contractor, who replaced the gutters again. The next time it rained, the gutters leaked and flooded Betty's basement a second time. Frustrated, Betty decided to file a lawsuit against the contractor in an attempt to recover the money she lost. This is an example of ______. a. Accepting partial performance b. Rescinding the contract unilaterally c. Suing for damages and breach of contract d. Suing for specific performance

c. Suing for damages and breach of contract

Olivia took out a 15-year loan secured with a deed of trust. She worked two jobs in order to pay the loan back and finally made her last payment this month. What happens now? a. The lender releases the deed of trust that secured her mortgage loan. b. The lender releases the mortgage that secured her mortgage loan. c. The lender tells the trustee to release the title to Olivia. d. The trustee releases the mortgage that secured her mortgage loan.

c. The lender tells the trustee to release the title to Olivia.

Avery is about to close on his first home. What will protect him from financial loss if his ownership later comes into question? a. Abstract of title b. Chain of title c. Title insurance d. Title search

c. Title insurance

Rex needs to handle some money he acquired during an "unsavory" business deal. He agrees to sign his boat over to his colleague, Ben, if Ben can launder the money and return it to Rex as part of a legal business dealing. What kind of contract do Rex and Ben have? a. Executed b. Executory c. Void d. Voidable

c. Void

What is the most common way that asbestos enters the body? a. Asbestos coating in water pipes can contaminate drinking water, which is then ingested. b. Asbestos in paint can be released into the air as the paint peels, which is then inhaled or ingested. c. When asbestos fibers decay or are disturbed, the friable particles can be inhaled. d. When rocks and soil decay, asbestos gas is released, which is then inhaled.

c. When asbestos fibers decay or are disturbed, the friable particles can be inhaled.