Real Estate

An appraiser determines the value of a property to be $100,000. The future owner is granted a mortgage of $92,500 that they will borrow. What is the loan-to-value ratio?

$92,500 / $100,000 = 92.5%

Explain a net lease.

A lease that includes the provision that the lessee pay some or all of the expenses of operating the property such as property taxes, insurance, utilities, repairs, and maintenance.

Explain mortgage brokers.

A person or entity licensed in the jurisdiction of its business to solicit applications for the loan of funds for the purpose of purchase or refinance of real property where such funds are provided by those other than the mortgage broker.

Explain mortgage bankers.

A person or entity licensed in the jurisdiction of its business to solicit applications for the loan of funds, and to make such loans on its own account to borrowers for the purchase of refinance of real property.

What is a license?

A personal privilege to enter the land of another for a specific purpose.

What is condemnation?

A police power to condemn the use of property if it is structurally unsound, unfair, or unsafe for occupancy.

What is the Mortgage Electronic Registration System (MERS)?

A private national mortgage database that provides services and acts as noteholder. MERS holds notes and keeps records when loans are sold.

A dangerous condition of real property that invites trespassers who may be injured or killed, such as an open well or unfenced swimming pool, is called what?

Attractive Nuisance Doctrine

What is a specific agent?

Authorized to represent the principal in one specific act or business transaction.

Property managers must exercise risk management skills when considering the possibility of loss. What are these skills? Remember: ACTOR

Avoid it Control it Transfer it OR Retain it

When land is suddenly torn away by the action of water, what is this called?

Avulsion

Principle of __________ states that the more that structures are in harmony with one another, the more valuable each of those structures.

Conformity

Explain agreement as a reason to terminate an agency.

Consent required of both principle and agent either party can end the agreement at any time; a party wrongfully breaching the agreement could be liable for damages.

An interim loan designed to provide funds for the improvements on land would be considered what type of loan?

Construction Loan

What is the CFPB?

Consumer Financial Protection Bureau

____________ occurs when the consumer becomes contractually obligated to the creditor of the loan.

Consummation

With the principle of ____________, the worth of an improvement as well as what it adds to the entire property's market value, regardless of the actual cost.

Contribution

What is the CAN-SPAM Act of 2003?

Controlling the Assault of Non-Solicited Pornography and Marketing on the internet. Created to protect consumers from being assaulted by misleading emails. Each violation is subject to a fine of $11,000.

Loans made without government guarantees are __________________.

Conventional loans

When a provision in a homeowner's mortgage allows them to elect a fixed interest rate after a certain period of time, what type of mortgage do they have?

Convertible Adjustable Rate Mortgage

In a ___________, each owner owns stock in corporation and has the right to occupy a unit under a proprietary lease.

Cooperative

A ___________ is an artificial but legal person created by state law, a separate entity.

Corporation

A ____________ is a legal entity registered with and regulated by the state. _____________ are generally considered persons for legal purposes and are authorized to buy and sell property, enter into contracts, and pay taxes. *One answer*

Corporation(s)

Explain punitive damages in terms of a breached contract.

Court may award damages beyond compensatory to punish the guilty party.

In terms of lease provisions, the right of a tenant or owner to use property without interference from others claiming the right to use the property is known as what?

Covenant of Quiet Enjoyment

Explain implied agency.

Created by implication when, from the nature of the principal's business and the position of the agent within that business, the agent is deemed to have permission from the principal to undertake certain acts.

What is an involuntary lien?

Created by law and may be either statutory or equitable, not a matter of choice.

What is a statutory lien?

Created by statute, such as a real estate tax.

What are emblements?

Crops planted annually

A lease agreement in which the amount of future lease payments are calculated using an established index, typically the consumer price index is known as what type of lease?

Index lease

What are brownfields?

Industrial and commercial sites that are abandoned or underused because of real or perceived contamination.

Courts require that at least one of the following four tests be met to determine if an item is a fixture. What are the four tests?

Intent, attachment, adaptability, agreement

What is a voluntary lien?

Intentional by property owner's action such as a mortgage loan

In loan terms, a specified or promised periodic return on a cash advance, in exchange for use of the money, would be called what?

Interest

A loan in which simple interest is paid periodically would be considered what type of loan?

Interest-Only Loan

When an owner takes action to force condemnation of a property caused by government action, due to a loss in value or inability to use the property, what is this called?

Inverse condemnation

If a homeowner has received a notice for a lien created by law, what type of lien is this considered?

Involuntary

What is an easement?

Irrevocable right or interest one party has in another's land.

Describe the adaptability test of a fixture.

Is it custom built to fit a particular space or custom match?

Describe the attachment test of a fixture.

Is it permanently attached by nails, bolts, pipes, or can it be easily removed without causing damage?

Explain title insurance.

It is more than an opinion it is a limited guarantee of marketable title, which insures against financial loss from defects in title to real property and from the invalidity or unenforceability of mortgage loans. Paid by the buyer at closing.

An undivided ownership by two or more people with the right of survivorship is known as what?

Joint Tenancy

Definition of Real Estate

Land at, above, and below the earth's surface, plus all things permanently attached to it, whether natural or artificial

Under a _____________, the seller retains the legal title to the property, while permitting the buyer to take possession of it for most purposes other than legal ownership, expecting ownership in future.

Land contract

Define reliction.

Land that forms after water recedes

What is buffer zoning?

Land use that separates two different zones, providing for privacy and green space

A penalty for a delinquent payment assessed by a lending institution, landlord, or others who have the contractual right to do so is called what?

Late charges

A _____ is a contract that transfers the right to possess a property from the owner, to another party.

Lease

If someone has a legal use that was already in existence prior to new zoning restrictions, what is this called?

Legal nonconforming use

Explain loan value.

Less than market value, usually a percentage of market value, leaving a margin for lender security

In terms of lease provisions, what is a tenant referred to as?

Lessee

In terms of lease provisions, what is a landlord referred to as?

Lessor

Explain flood plains.

Level areas bordering waterways subject to inundation subject to government restrictions

________ is the use of borrowed funds to purchase investment property with the anticipation that the property acquired will increase in return so that the investor will realize a profit not only on his own investment, but also on the borrowed funds; the employment of a smaller investment to generate a larger rate of return through borrowing.

Leverage

_____ is a monetary claim against property. The property is security for a debt.

Liens

A freehold estate that is limited in duration to the life of the owner is known as what?

Life Estate

What is a restrictive covenant?

Limitations to the use of property imposed by the past or current owner

A _________________________ is a legal form of business entity that is governed by an operating agreement and characterized by a blend of elements of a partnership and a corporation.

Limited Liability Company (LLC)

Which form of business ownership is tax-advantaged?

Limited partnership

What is breach of contract compensation called?

Liquidated damages

_________ is the ability to sell an asset and convert it into cash at a price close to its true value.

Liquidity

A _______ contract is a contract between a real estate broker and a seller or sellers of real property to give the broker the right to offer the property for sale.

Listing

To establish a _____________ the agent will perform a Comparative Market Analysis (CMA).

Listing price

If a homeowner's property borders a commercially navigable body of water, such as a lake, sea or ocean, what type of rights will they have?

Littoral rights

A loan secured by real property that contains a provision allowing a seller of the property to transfer the loan officially into the buyer's name, is called what?

Loan Assumptions

_______________ are conditions included in the loan documents and/or note. Basic _______________ included amount of loan, interest rate, monthly payments, term of loan. *One answer*

Loan provisions

What are conventional loans?

Loans made without government guarantees. Generally have a lower loan-to-value ratio than government insured or guaranteed loans.

The point in the loan application process where the interest rate and terms of the loan are guaranteed is called what?

Lock-in Clause

Explain physical deterioration.

Loss in value due to normal aging and deterioration. Wear and tear from normal use or neglect.

"Lot 12 Block 1 of Pacific Heights recorded in the Middlesex Registry of Deeds Book 39 pages 888 to 901," is an example of what kind of property description?

Lot, Block, and Tract

_________________ is an agreement of firms to divide the marketplace on a geographic or service type basis.

Market allocation

___________ the actual sales price of the property.

Market price

What is the difference between market value and market price?

Market price is the actual sales price of the property, while the price for which the property should sell is its market value. Market price is a fact, and market value is an opinion.

_____________ is the cash price a willing, informed buyer would pay to a willing, informed seller in an open market, allowing a reasonable marketing time, under normal conditions and an "arm's length transaction."

Market value

What type of title would be considered good or clear title, reasonably free from the risk of litigation over possible defects that would be accepted by a prudent buyer?

Marketable title

What is the Government (Rectangular) Survey?

Massachusetts does not use this method. You just need to be aware of this method for the exam.

The enabling declaration recorded at the county registry of deed is known as ___________.

Master Deed

Explain police power in terms of public restrictions on private property.

Master planning, zoning ordinances, building codes

In terms of lease provisions, explain forfeiture.

May provide for a material breach of a provision of the lease can end the tenant's rights; such as nonpayment of rent.

___________ is the name for a federal law, and informal name for subsequent state laws, in the United States requiring law enforcement authorities to make information available to the public regarding registered sex offenders.

Megan's Law

A lease will be terminated if the lessor and lessee become the same person. What is this called?

Merger

A minor can enter into a contract, and then later ask to have it voided because of ____________.

Minor status

An intentional misstatement, or concealment of facts so that another party is led to act in a certain way in contract negotiations, is called what?

Misrepresentation

__________ is the lenders indication that they are willing and able to make the loan to the applicant when a suitable property has been secured by a real estate contract.

Preapproval

____________ is the illegal cooperative or collusive setting of price levels by competitors within an industry.

Price fixing

The two terms: Primary Financing & Primary Mortgage Market, are often confused with one another. Explain the difference.

Primary financing is the first loan, primary mortgage market are loans made directly to borrowers.

In loan terms, a form of insurance developed to protect lenders who offer high loan-to-value ratio mortgage loans is called what?

Private Mortgage Insurance

With principle of ___________, value of an interior property will be worth more because of the presence of greater-valued properties nearby.

Progression

What did the Civil Rights Act of 1964 do?

Prohibited discrimination in housing wherever there was government assistance.

What is discriminatory advertising?

Prohibited, even those with exemptions from the act, unequal treatment of potential buyers or renters based on the buyer's or renter's race, color, religion, gender, or age constitutes unlawful discrimination.

What prohibitions does the Federal Housing Act give brokers?

Prohibits brokers from discriminating as to clients and customers, falsely misrepresent on a property's availability, discriminate in access to MLS, and discriminate on sale, and loan terms.

A ________________ is a financial document evidencing a debt and the terms under which it will be repaid. It is a separate document.

Promissory note

A ____________ is executed to provide the loan of funds for the purchase or refinance of the property. The ________ is a two party instrument whereby the borrower gives an interest and a note to the lender in exchange for a loan.

Promissory note; mortgage

Adjustments to costs shared by a buyer and seller are called what?

Prorations

In terms of lease provisions, what must happen with fixtures?

Provide for removal of improvements and/or specify that all improvements remain with the landlord.

What is incentive zoning?

Provides an incentive for developers to include affordable units or desirable amenities

Explain capitalization rate.

Provides for the return of invested capital plus a return on the investment. The rate is dependent upon the return a buyer will demand before investing money in the property.

What is a homestead exemption?

Provides limited protection of the value of the home, against unsecured creditor claims.

In terms of lease provisions, explain a renewal option.

Provides the leaseholder the option, but not the obligation, to renew or extend a lease agreement beyond its initial terms.

________________ are required for zoning variances, conditional use permits, and rezoning.

Public hearings

A statement of opinion that is exaggerated to influence a party is called what?

Puffing

The court awarded damages to the injured party to punish the guilty party, this is called what?

Punitive damages

A life estate based on the life of another person other than the life tenant is known as what?

Pur autre vie - "For the life of another"

A mortgage issued to the borrower by the seller of the home as part of the purchase tradition when the buyer cannot qualify for a mortgage through traditional lending channels is considered what type of loan?

Purchase Money Loan

Explain how the element of physical force influences value.

Quality of conveniences; availability of schools, shopping, transportation, church, similarity of land use

Explain the principle of supply and demand.

Real estate is affected by supply and demand. Increasing supply or decreasing demand will reduce the price in the market. A buyer's market is created because there is more supply than demand. Reducing supply or increasing demand will raise the price in the market. This creates a seller's market because there is more demand than the supply.

A deed is used to transfer only _____________.

Real property

Explain trust.

Real property can be held in trust by a trustee for the benefit of one or more parties. The trustee is bound to act in the interests of the beneficiary and within the restrictions of the trust.

Regarding inheritance, what does devise mean?

Real property given by will

What are fructus naturales?

Real property that naturally goes with the land (Natural growing plants, perennial crops, trees, etc.)

Freehold estates are considered _____________ with ownership interest and are transferred using a ____.

Real property; Deed

In terms of lease provisions, a term sometimes found in commercial leases allowing the landlord to retake possession of the leased premises if the tenant fails to meet financial projections that are part of a percentage lease is called what?

Recapture clause

Explain the bylaws of association.

Recorded at registry of deeds. They describe rules of self-government.

Explain the term lis pendens.

Recorded notice of "litigation pending" concerning an interest in real property, gives public notice of an interest.

Explain secondary financing.

Refers to second or junior mortgages. Has a shorter term than primary financing, with a greater likelihood of a balloon payment at the end of the term, and a higher interest rate due to greater risks.

Explain the scarcity element of value.

Refers to the availability of a commodity in the marketplace. An oversupply diminishes value whereas an undersupply (or increased demand) increases value.

Explain primary financing.

Refers to the first loan on a property, such as a first mortgage. Is usually amortized loans

Explain subprime.

Refers to the quality of loan as an investment or to the borrower whose creditworthiness is below average. Made with higher interest rates and fees to offset the greater risk.

When two parties take action to correct a mistake in a contract agreement, and the two parties conform to original agreement, what is this called?

Reformation

What is aesthetic zoning?

Regarding architectural style and color so structures blend in with neighborhood

The principle of ___________ states that the value of a superior property will be worth less because of the presence of lower-valued properties nearby.

Regression

Explain subagency.

Subagency usually arises when a cooperating sales associate from another brokerage, who is not representing the buyer as a buyer's representative, shows property to a buyer.

An assignment is when a tenant transfers all of his leasehold rights to another party; the new tenant then pays rent directly to the landlord. When only some of those rights are transferred, then it is a ________.

Sublease

________ refers to the quality of loan as an investment or to the borrower whose creditworthiness is below average. Made with higher interest rates and fees to offset the greater risk.

Subprime

With principle of ____________, value is set by the cost of getting an equally desirable substitute. An owner cannot expect to sell for more than someone would ordinarily pay for a similar property, under similar conditions.

Substitution

Explain novation in terms of a breached contract.

Substitution of a new contract for an old one.

Explain the Purchase and Sale.

Supersedes the offer, and can be thought of as the "long form" contract. Sets out the terms of the deal.

Explain a personal property loan.

The Uniform Commercial Code provides that recording a financing statement creates a lien against personal property, including property that becomes a fixture.

_________ is an illegal lending practice, denying real estate loans in a particular geographic area (usually those containing large minority populations) because of alleged higher lending risks without consideration of the credit-worthiness of the individual applicant.

Redlining

When the agent gets paid no matter who sells the property, regardless of whether it's the agent or the seller, what type of listing agreement is this?

Exclusive right to sell listing

In terms of lease provisions, any contract provision relieving a party to the contract of some personal liability is called what?

Exculpatory clause

A contract that has fully performed, is what type of contract?

Executed

A contract in which one or both of the parties hasn't yet performed, is what type of contract?

Executory

What is Freddie Mac?

Federal Home Loan Mortgage Corporation

What corporation was established federally to increase liquidity in the mortgage market?

Federal Home Loan Mortgage Corporation (Freddie Mac)

What is the FHA?

Federal Housing Administration

What is Fannie Mae?

Federal National Mortgage Association

Which government agency purchases real estate loans after they are originated by a lender?

Federal National Mortgage Association (Fannie Mae)

What is the FED?

Federal Reserve System

If a deed specifies that a grant shall be only "for as long as" or while a property is in a particular use, the length of the estate is determined by the deed. Use for another purpose would automatically end the estate, and no action of the grantor would be necessary. This is known as _______________________.

Fee Simple Determinable

What is the highest form of ownership possible in real property, and also the most common?

Fee Simple or Fee Simple Absolute

If a someone is granted a property on the condition that alcohol never be served, this is known as what?

Fee simple on condition subsequent

What are examples of artificial monuments in a metes and bounds property description?

Fences, iron stakes, rods, etc.

Explain eminent domain in terms of public restrictions on private property.

Government right to take property for the public good in return for fair compensation

What is used to value residential properties with 1 to 4 units and is equal to the sales price divided by the monthly rent?

Gross Rent Multiplier (GRM)

A simple commercial lease in which the lessor pays all building-related expenses, such as taxes, utilities, insurance, and maintenance, is known as what kind of lease?

Gross lease

A ____________ is typically a long-term lease, as lease holders would be unwilling to build costly improvements if the benefit of such improvements could only be realized for a small number of years.

Ground lease

________________ is when a group of businesses agree not to do business with a particular party.

Group boycotting

What is a general agent?

Has all the authority to conduct business or trade on behalf of the principal.

Describe the agreement test of a fixture.

Have parties agreed on whether the item is real or personal property in an offer to purchase?

Regarding inheritance, what does intestate mean?

Having died without leaving a will, title to property will pass to heirs as provided by state law

Regarding inheritance, what does testate mean?

Having made and left a valid will

What does the Zoning Board of Appeals do?

Hear requests for zoning variances

What does a state certified general appraiser do?

Highest license, can appraise all properties, residential and commercial

When a tenant fails to vacate the leased premises at the end of the lease term and the landlord continues to accept rental payments, the common law presumption is that the parties have agreed to extend the lease on a month-to-month basis, what is this called in terms of lease provisions?

Holdover clause

Explain the Taxpayer Relief Act of 1997.

Homeowners were given advantageous exemption from taxation. To be eligible, a homeowner must have occupied a property as principle residents for a total of 24 months during the preceding five year period.

What does an environmental impact report study?

How a development will affect the balance of nature of its surroundings

What is liquidity?

The ability to sell an asset and convert it into cash at a price close to its true value

In terms of loan provisions, explain a subordination clause.

The act of permitting one's estate or security interest in real property to be reduced to a lesser priority. This is done in situations where it is considered to be a temporary condition; there is adequate compensation for the risk; and an analysis of the probability of a default is made and determined to be remote.

Explain objective value.

The actual market value

Define seisin.

The actual possession of real property under claim of a freehold estate, grantor warrants the right to sell or convey.

What happens when accretion adds land to property?

The added land through accretion belongs to the owner

Explain a buyer agency listing agreement.

The agency agrees to represent the buyer and use best efforts to locate a property that meets the needs of the buyer.

Explain an exclusive right to sell listing agreement.

The agent gets paid no matter who sells the property, regardless of whether it's the agent or the seller.

Explain accounting as a duty of the agent.

The agent must account for all funds entrusted to them and not commingle (combine) client/customer funds with her personal and/or business funds.

Explain disclosure as a duty of the agent.

The agent must disclose to the client any information she receives that may benefit the client's position in a negotiation.

Explain confidentiality as a duty of the agent.

The agent must keep confidential any information given by the client, especially information that may be damaging to the client in a negotiation.

Explain obedience as a duty of the agent.

The agent must obey all lawful orders that the client gives.

Explain reasonable care as a duty of the agent.

The agent must use all of her skills to the best of her ability on behalf of the client.

Explain loyalty as a duty of the agent.

The agent owes undivided loyalty to the client and puts the client's interests above her own.

Explain a partially amortized loan.

The amount of monthly payments due are calculated (amortized) over a certain term, but the outstanding principal balance is due at some point short of that term, and at the end of the term a balloon payment is due.

What is reconciliation?

The analysis of the three value approaches to determine the final value to assign to the property

Definition of Bundle of Rights

The beneficial right to use, exclude others, lease, encumber, transfer, and inherit as ownership rights

Explain a land contract.

The seller retains the legal title to the property, while permitting the buyer to take possession of it for most purposes other than legal ownership, expecting ownership in future.

Explain sole proprietorship.

The simplest business form under which one can operate a business. It is not a legal entity. It simply refers to a person who owns the business and is personally responsible for its debts.

What is accession?

When the tenant of a leased building fails to remove the trade fixtures they installed, and they become real property of the landlord.

Define unconscionable in terms of contract negotiations.

When the terms are so outrageous that benefit one party over another party, the court can rule it void.

The appraised value of a residence with four bedrooms and one bathroom would probably be reduced because of... a. external obsolescence b. functional obsolescence c. curable physical deterioration d. incurable physical deterioration

b. functional obsolescence

A home with its kitchen next to the master bedroom would be considered... a. physically obsolete b. functionally obsolete c. economically obsolete d. diminished

b. functionally obsolete

In which clause in a deed would the phrase "to have and to hold" appear? a. safety clause b. habendum clause c. description clause d. execution

b. habendum clause

In order to sell timesharing, a person... a. does not need to be licensed b. must be licensed as a salesperson c. must hold a broker's license d. must be an appraiser

b. must be licensed as a salesperson

Some property owners list their property for sale with a broker. During the listing negotiations, they tell the broker that they want $138,000 for the property, and anything above that amount the broker can keep as a commission. A listing with this type of provision is known as a(n)... a. gross listing b. net listing c. open listing d. nonexclusive listing

b. net listing

The essential elements of a contract include all of the following EXCEPT: a. offer and acceptance b. notarized signatures c. competent parties d. consideration

b. notarized signatures

A homestead is a legal life estate in real estate that is... a. leased by renters b. occupied as the family home c. used as a vacation home d. a secondary residence.

b. occupied as the family home

The covenant implied in a lease that ensures that the landlord will not interfere in the tenant's possession or use of the property is the covenant... a. of seisin b. of quiet enjoyment c. of warranty forever d. against encumbrances

b. of quiet enjoyment

A building was purchased for $850,000, with 10% down and a loan for the balance. If the lender charged the buyer two discount points, how much cash did the buyer need at closing if the buyer incurred no other costs? a. $17,000 b. $85,000 c. $100,300 d. $102,000

c. $100,300

What is the commission rate of 5% on a sale of $250,000? a. $25,000 b. $1,750 c. $12,500 d. $3,571

c. $12,500

A home sells for $565,000 in Needham. The residential tax rate in Needham is $13.56 per 1,000. What is the transfer tax fee due at closing by the seller? a. $7,661.40 b. $25,760.00 c. $2,576,40 d. zero

c. $2,576,40

Federal income tax law excludes gain realized on the sale of a primary residence for individuals filing separately and for couples filing jointly. The amount of this exclusion is (separately/jointly). a. $100,000/$200,000 b. $125,000/$250,000 c. $250,000/$500,000 d. $300,000/$600,000

c. $250,000/$500,000

Miss Morgan bought a parcel of land for $115,000. She built a 36' by 24' home on it at a cost of $200 per square foot. What was the total cost of the land and the building? a. $172,800 b. $205,000 c. $287,800 d. $305,000

c. $287,800

A contract is said to be bilateral if... a. one of the parties is a minor. b. the contract has yet to be fully performed. c. only one party to the agreement is bound to act. d. both parties to the contract exchange binding promises.

d. both parties to the contract exchange binding promises.

The primary purpose of Truth in Lending is to: a. Control the true cost of closing b. Teach consumers about business relationships and loans c. Disclose the true costs of obtaining credit d. Disclose the true cost of FHA loans only

c. Disclose the true costs of obtaining credit

A seller tells his agent in confidence that he must sell fast and may accept less than the list price. The agent tells a buyer the seller will accept up to $5,000 less than the list price. Which is TRUE? a. The agent has not violated any agency responsibilities to the seller. b. The agent should have disclosed this information, regardless of its accuracy. c. Disclosure was improper and possibly illegal, regardless of the agent's motive. d. The relationship between the agent and the seller ends automatically if the purchaser submits an offer.

c. Disclosure was improper and possibly illegal, regardless of the agent's motive.

A property owner wants to use water from a river that runs through the property to irrigate a potato field. To do so, the owner is required by state law to submit an application to the Department of Water Resources describing in detail the plan for beneficial use of the water. If the department approves the owner's application, it will issue a permit allowing a limited amount of river water to be diverted onto the property. Based on these facts, it can be assumed that this property owner's state relies on which rule of law? a. Riparian rights b. Littoral rights c. Doctrine of prior appropriation d. Doctrine of highest and best use

c. Doctrine of prior appropriation

When a valid deed is delivered, unless stated otherwise, it is assumed that which of the following estates is delivered? a. Life b. Leasehold c. Fee simple d. Freehold

c. Fee simple

Which of the following is the BEST way to ensure that there are no encroachments and verify the boundaries of a parcel of land? a. Write a legal description b. Find the monuments c. Get a spot survey d. Verify the benchmarks

c. Get a spot survey

A tenant signs a lease that includes a schedule of rent increases on specific dates over the course of the lease term. What kind of lease has this tenant signed? a. Percentage b. Net c. Graduated d. Index

c. Graduated

Which of the following is a legal life estate? a. Leasehold b. Fee simple absolute c. Homestead d. Determinable fee

c. Homestead

Generally, where does a probate proceeding involving real property take place? a. Only in the county in which the property is located b. Only in the county in which the decedent resided c. In both the county where the decedent resided and the county in which the property is located d. In the county in which the executor or the beneficiary resides

c. In both the county where the decedent resided and the county in which the property is located

An appraiser asked for an opinion of the value of an existing shopping center would probably give the MOST weight to which approach to value? a. Cost approach b. Sales comparison approach c. Income approach d. Index method

c. Income approach

Which appraisal method uses a rate of investment return? a. Sales comparison approach b. Cost approach c. Income approach d. Gross income multiplier method

c. Income approach

Which of the following best describes an exclusive right-to-buy contract in Massachusetts? a. It requires the signature of the principal b. It is illegal c. It is equivalent to an exclusive right-to-sell listing agreement d. It should be indicated as such in the buyer agency agreement

c. It is equivalent to an exclusive right-to-sell listing agreement

The grantor becomes the lessee and the grantee becomes the lessor under which of the following financing agreements? a. Partial sale b. Wraparound mortgage c. Sale and leaseback d. Assumption of mortgage

c. Sale and leaseback

What types of agency are MOST commonly practiced in Massachusetts? a. Seller's, buyer's, and undisclosed dual b. Subagency, disclosed deal, and seller's c. Seller's, buyer's, disclosed deal, and designated d. Seller's, buyer's, and full fiduciary

c. Seller's, buyer's, disclosed deal, and designated

Which of the following is MOST likely evidence of ownership in a cooperative? a. Tax bill for an individual unit b. Existence of a reverter clause c. Shareholder stock d. Right of first refusal

c. Shareholder stock

At which of the following steps did title to the house actually transfer or pass to B? Step 1: A decided to convey a house to B. Step 2: A signed a deed transferring title to B. Step 3: A gave the signed deed to B, who accepted it. Step 4: B took the deed to the county recorder's office and had it recorded. a. Step 1 b. Step 2 c. Step 3 d. Step 4

c. Step 3

A buyer purchased a parcel of land and immediately sold the mineral rights to an oil company. The buyer gave up which of the following? a. Air rights b. Surface rights c. Subsurface rights d. Vertical rights

c. Subsurface rights

A real estate professional is selling a home to a buyer and told her that the foundation was "solid as a rock" when he knew for a fact that it was slowly sinking into the landfill on which it was built. Now that the sale is completed, which of the following is LEAST likely to happen to the real estate professional? a. Revocation of his license for failure to disclose a material fact b. Being charged with intentional misrepresentation c. Successful defense against all charges based on loyalty to his client-seller d. Suit to recover money damages experienced by the buyer due to basement leakage

c. Successful defense against all charges based on loyalty to his client-seller

The death of either the landlord or the tenant will terminate the lease and the parties' heirs will NOT be bound by its terms under which of the following tenancies? a. Tenancy for years b. Periodic tenancy c. Tenancy at will d. Tenancy at sufferance

c. Tenancy at will

A mortgagee received a title insurance policy on the property a buyer is pledging as security for the mortgage loan. Which of the following is TRUE? a. The policy is issued for the benefit of the buyer. b. The policy guarantees that the buyer's equity will be protected. c. The amount of coverage is commensurate with the loan amount. d. The amount of coverage increases as the borrower grows older.

c. The amount of coverage is commensurate with the loan amount.

Which of the following is NOT a valid reason to terminate an agency relationship? a. The agent found a home for a buyer to purchase, and the sale closed. b. The property was condemned. c. The buyer wanted to work with a new agent, but the terms of agency had not yet expired and the current agent did not agree to terminate. d. The buyer went bankrupt.

c. The buyer wanted to work with a new agent, but the terms of agency had not yet expired and the current agent did not agree to terminate.

A single man with two small children has been told by a real estate professional that homes for sale in a condominium complex are available only to married couples with no children. Which statement is TRUE? a. Because a single-parent family can be disruptive if the parent provides little supervision of the children, the condominium is permitted to discriminate against the family under the principle of rational basis. b. Condominium complexes are exempt from the fair housing laws and can therefore restrict children. c. The man may file a complaint alleging discrimination on the basis of familial status. d. Restrictive covenants in a condominium take precedence over the fair housing laws.

c. The man may file a complaint alleging discrimination on the basis of familial status.

A broker employs several salespeople, one of whom, Ann, is a member of a protected group. The broker directs her to work only with members of her group to solicit sales only in similar neighborhoods. Which of the following is TRUE? a. The broker is entitled to direct Ann's activities this way. b. The fair housing laws do not apply to the broker's practices. c. The practice could establish or continue the unlawful practice of steering. d. The salesperson should be satisfied with the broker's policy.

c. The practice could establish or continue the unlawful practice of steering.

A state has recently updated its Rules and Regulations for the Real Estate Profession. Which statement is most likely TRUE regarding this update? a. The rules and regulations are state laws enacted by the legislature. b. The rules and regulations do not have the same force and effect as the statutory license law. c. The rules and regulations have the same force and effect as the license law itself. d. The rules and regulations are not enforceable against real estate professionals.

c. The rules and regulations have the same force and effect as the license law itself.

A buyer who is a client of the broker wants to purchase a house that the broker has listed. Which statement is TRUE? a. The broker may proceed to write an offer on the property and submit it. b. The broker should refer the buyer to another broker to negotiate the sale. c. The seller and the buyer must be informed of the situation and agree in writing to the broker's representing both of them. d. The buyer should not have been shown a house listed by the broker.

c. The seller and the buyer must be informed of the situation and agree in writing to the broker's representing both of them.

A legally enforceable agreement under which both parties promise to do something for each other is called... a. an escrow agreement b. a legal pledge c. a bilateral contract d. an option agreement

c. a bilateral contract

All of the following would be acceptable as evidence of marketable title EXEPT... a. a torrens certificate b. a title of insurance policy c. a certificate of title by a real estate broker d. a certificate of title by a real estate attorney

c. a certificate of title by a real estate broker

At closing, the listing agent's commission is usually shown as... a. a credit to the seller. b. a credit to the buyer. c. a debit to the seller. d. a debit to the buyer.

c. a debit to the seller.

All the following clauses in a loan agreement enable the lender to demand the entire remaining debt be paid immediately EXCEPT... a. a due-on-sale clause. b. an acceleration clause. c. a defeasance clause. d. an alienation clause.

c. a defeasance clause.

Title insurance provides a means of financial protection if... a. the bank had a title search conducted. b. the buyer did not pay the lawyer. c. a defect is found in the title. d. the seller paid for the title search.

c. a defect is found in the title.

In order to be valid all exclusive listings must include... a. an automatic renewal clause b. forfeiture clause c. a definite date of expiration d. permission for the listing broker to appoint subagents

c. a definite date of expiration

When the broker principal appoints an agent to work specifically with one seller, this is an example of... a. a facilitator b. a dual agency c. a designated agency d. a buyer agency

c. a designated agency

An example of a kickback that is prohibited by TRID is... a. a fee paid by Broker A to Broker B for referring a buyer to Broker A. b. a share of the commission paid by Broker A to the salesperson. c. a fee paid by a surveyor to a broker for referring a property to be surveyed. d. a flower arrangement that a salesperson senses to the buyer as a housewarming gift.

c. a fee paid by a surveyor to a broker for referring a property to be surveyed.

The owner of fee simple title to a vacant lot adjacent to a hospital decided to make a gift of the lot to the hospital. The deed conveyed ownership of the lot to the hospital "so long as it is used for hospital purposes." After completion of the gift, the hospital will own... a. a fee simple absolute estate b. a license c. a fee simple determinable d. a leasehold estate.

c. a fee simple determinable

The relationship of broker to client in an agency relationship is that of... a. a trustee b. a subagent c. a fiduciary d. an attorney-in-fact.

c. a fiduciary

In inflationary times, a property manager would NOT want a long-term lease based on... a. graduated payments b. the consumer price index c. a fixed rate d. a cost-of-living index

c. a fixed rate

Method of annexation, adaptation to real estate, and agreement between the parties are the legal tests for determining whether an item is... a. a trade fixture or personal property. b. real property or real estate. c. a fixture or personal property. d. an improvement.

c. a fixture or personal property.

Radon is... a. only found in the eastern United States. b. easy to detect because of its odor. c. a known human carcinogen. d. not found in older homes.

c. a known human carcinogen.

Radon is... a. only found in the eastern United States. b. easy to detect because of its odor. c. a known human carcinogen. d. not found in older homes.

c. a known human carcinogen.

A mortgage in which the seller will deliver a deed upon receipt of the final mortgage payment is... a. a purchase money mortgage b. a secondary mortgage c. a land sales mortgage d. an equity mortgage

c. a land sales mortgage

A mortgage reduction certificate is executed by... a. an abstract company b. an attorney c. a lending institution d. a grantor

c. a lending institution

In real estate, a sales associate is always a. an independent contractor. b. an employee of a licensed broker. c. a licensee who performs real estate activities on behalf of a broker. d. a combination office manager, marketer, and organizer with a fundamental understanding of the real estate industry, who may or may not be licensed.

c. a licensee who performs real estate activities on behalf of a broker.

A seller delivered title to a buyer at closing. A title search had disclosed no serious defects, and the title did not appear to be based on doubtful questions of law or fact or to expose the buyer to possible litigation. The seller's title did not appear to present a threat to the buyer's quiet enjoyment, and the title insurance policy provided was sufficient to convince a reasonably well-informed person that the property could be resold. The title conveyed would commonly be referred to as... a. a certificate of title. b. an abstract of title. c. a marketable title. d. an attorney's opinion of title.

c. a marketable title.

Residential leases are usually expressed as... a. an annual or monthly rate per square foot. b. a percentage of total space available. c. a monthly rate per unit. d. an annual rate per room.

c. a monthly rate per unit.

A tenant enters into a commercial lease that requires a monthly rent of a minimum fixed amount, plus an additional amount determined by the tenant's gross receipts exceeding $5,000. This type of lease is called... a. a standard lease b. a gross lease c. a percentage lease d. a net lease

c. a percentage lease

Under the federal Fair Housing Act, it is illegal to discriminate because... a. a person has a history of dangerous behavior b. a person's marital status c. a person has AIDS d. a person has been convicted of distributing a controlled substance

c. a person has AIDS

A license is an example of... a. an easement appurtenant b. an encroachment c. a personal privilege d. a restriction.

c. a personal privilege

An agent has two listings from the same owner. One listing is located at 9 Mason Street and the other at 4 Mason Street. This agent would be known as... a. a dual agent b. a single agent c. a special agent d. a general agent

c. a special agent

A loan in which the borrower makes only interest payments is called... a. a fixed-rate loan b. an adjustable-rate mortgage c. a straight loan d. a reverse mortgage.

c. a straight loan

A map illustrating the sizes and locations of streets and lots in a subdivision is called... a. a gridiron plan b. a survey c. a subdivision plat map d. a property report

c. a subdivision plat map

Which of the following would be used to clear a defect from the title records? a. a lis pendens b. an estoppel certificate c. a suit to quiet title d. a writ of attachment

c. a suit to quiet title

A property manager hires a full-time maintenance person. While repairing a faucet in one of the apartments, the maintenance person steals some jewelry and the tenant sues the owner. The property manager could protect the owner against this type of loss by purchasing... a. liability insurance b. workers' compensation insurance c. a surety bond d. casualty insurance

c. a surety bond

Massachusetts is... a. a lien theory state b. an intermediate theory state c. a title theory state d. a warranty deed state

c. a title theory state

A broker helps a buyer and a seller with paperwork but does not represent either party. This relationship is... a. dual agency b. prohibited in all states because a broker must always represent one party c. a transactional brokerage d. a designated agency

c. a transactional brokerage

A trust is a legal arrangement in which property is held for the benefit of a third party by... a. a beneficiary b. a trustor c. a trustee d. an attorney-in-fact.

c. a trustee

If a person runs an ad in a newspaper offering a reward for his lost dog, this would be an example of... a. an executory contract b. an executed contract c. a unilateral contract d. a bilateral contract

c. a unilateral contract

A minor signed a two-year lease for an apartment. This would be an example of... a. a valid contract b. a voided contract c. a voidable contract d. consummation

c. a voidable contract

An owner of real estate was declared legally incompetent and was committed to a state mental institution. While institutionalized, the owner wrote and executed a will. The owner died while still institutionalized and was survived by a spouse and three children. The real estate will pass... a. to the owner's spouse b. to the heirs mentioned in the owner's will c. according to the state laws of descent d. to the state.

c. according to the state laws of descent

A tenant moves a pet into an apartment community that has a no-pets policy. The landlord wishes to remove the tenant due to the breach. The legal process to remove a tenant is known as... a. constructive eviction b. eminent domain c. actual eviction d. partial eviction

c. actual eviction

All of the following are true about lead-based paint EXCEPT... a. it was commonly used in residences before 1978. b. renovation by a contractor of a residence that has lead-based paint requires education and certification. c. all residential buildings must be tested for lead-based paint. d. it is most dangerous when ingested.

c. all residential buildings must be tested for lead-based paint.

Liquidation of a loan with equal payments is called... a. alienation b. equal payment loan payoff c. amortization d. compounding

c. amortization

A written summary of the history of all conveyances and legal proceedings affecting a specific parcel of real estate is called... a. an adjustment of title. b. a certificate of title. c. an abstract of title. d. a title insurance policy.

c. an abstract of title.

An individual who is authorized and consents to represent the interests of another person is... a. a customer. b. a principal. c. an agent. d. a facilitator.

c. an agent.

A loan that provides for the full payment of the principal over the life of the loan is... a. a reverse mortgage b. an indexed loan c. an amortized loan d. a balloon payment

c. an amortized loan

The market value of a parcel of real estate is... a. an estimate of its future benefits. b. the amount of money paid for the property. c. an estimate of the most probable price it should bring. d. its value without improvements.

c. an estimate of the most probable price it should bring.

Unless stated to the contrary in a deed, ownership of land by a married couple is assumed to be by... a. severalty b. joint tenancy c. tenancy in common d. tenancy by the entirety

c. tenancy in common

The term quiet enjoyment refers to... a. the neighborhood b. the tenants right of possession c. tenants right to use without interference from owner d. habitability

c. tenants right to use without interference from owner

The Americans with Disabilities Act requires... a. all real estate to be free of barriers to people with disabilities. b. all employers to adopt nondiscriminatory employment practices. c. that reasonable accommodations be provided for people with disabilities. d. That existing premises be remodeled for people with disabilities regardless of the cost involved.

c. that reasonable accommodations be provided for people with disabilities.

As provided in a valid purchase contract, the real estate transaction must be closed. Closing requires all the following EXCEPT... a. that the seller clear the title so that the condition complies with the terms of the contract b. that the purchaser pay the balance of the purchase price to the seller. c. that the broker be present to receive any commission d. that the seller deliver the deed to the purchaser

c. that the broker be present to receive any commission

The law that requires lenders to find ways to help meet the housing needs of those of low and moderate incomes is... a. the Dodd-Frank Act b. the Equal Credit Opportunity Act c. the Community Reinvestment Act d. the Real Estate Settlement Procedures Act

c. the Community Reinvestment Act

One of the federal laws requiring disclosure to a loan applicant who is rejected for a loan on the basis of a credit report is... a. the Real Estate Settlement Procedures Act b. the Community Reinvestment Act c. the Fair Credit Reporting Act d. the Truth in Lending Act

c. the Fair Credit Reporting Act

By executing a listing agreement with a seller, a real estate broker becomes... a. a procuring cause b. obligated to open a special trust account c. the agent of the seller d. responsible for sharing commissions

c. the agent of the seller

By executing a listing agreement with a seller, a real estate broker becomes... a. a procuring cause. b. obligated to open a special trust account. c. the agent of the seller. d. responsible for sharing the commission.

c. the agent of the seller.

Reconciliation is an appraisal term used to describe... a. the appraiser's determination of a property's highest value b. an average of real estate values for properties similar to the subject property c. the appraiser's analysis and comparison of the results of all three appraisal approaches d. the method used to determine the most appropriate capitalization rate for a property

c. the appraiser's analysis and comparison of the results of all three appraisal approaches

TRID states all of the following EXCEPT... a. lenders must provide borrowers with a loan estimate of closing costs. b. a closing disclosure form must be provided 3 days prior to closing. c. the borrower may cancel the loan transaction within three days after settlement. d. consummation occurs when the borrower becomes legally obligated.

c. the borrower may cancel the loan transaction within three days after settlement.

The Truth in Lending - Real Estate Settlement Procedures Act (TRID) provides that... a. all real estate purchases must receive their closing statements. b. real estate advertisements must include the annual percentage rate, including all charges. c. the borrower must be given loan estimate of the closing costs 3 days after application is submitted. d. real estate syndicates must comply with the disclosures required by "blue sky" laws.

c. the borrower must be given loan estimate of the closing costs 3 days after application is submitted.

Broker Ed has done a proper comparative market analysis (CMA), discusses the probable market value of the property with the seller, and the seller wants an unrealistic price on the property. All of the following are true EXCEPT... a. the broker should suggest the seller have a formal appraisal done. b. the broker should take the listing with an understanding that price reductions may be needed. c. the broker must take the listing at the proposed seller's price. d. the broker may decline to take the listing at the high price.

c. the broker must take the listing at the proposed seller's price.

The exculpatory clause in a lease relieves the landlord from... a. the back rent b. the security deposit c. the liability for a tenant's personal injury in common areas d. the repairs to the unit

c. the liability for a tenant's personal injury in common areas

The term encapsulation refers to... a. the process of sealing a landfill with three to four feet of topsoil. b. the way in which insulation is applied to pipes and wiring systems. c. the method of sealing disintegrating asbestos. d. the way in which lead-based paint particles become airborne.

c. the method of sealing disintegrating asbestos.

A prospective buyer needs to borrow money to buy a house. The buyer applies for and obtains a real estate loan from a mortgage company. Then the buyer signs a note and a mortgage. In this example, the mortgage company is... a. the mortgagor b. the beneficiary c. the mortgagee d. the vendor.

c. the mortgagee

Property owner Zimmer inherited property from his mother in a life estate and then immediately sold the property to buyer Jones. If property owner Zimmer dies, who owns the property? a. the grantee b. the executor c. the remainderman d. no one

c. the remainderman

The final decision on a property's asking price should be made by... a. the seller's broker b. the appraised value c. the seller d. the seller's attorney

c. the seller

All of the following are required for a deed to be valid EXCEPT... a. consideration b. legal description c. name of the grantee d. signature of the grantee

d. signature of the grantee

The type of agency practiced in which there is only ever one client is... a. designated agency b. disclosed dual agency c. exclusive buyer agency d. single agency

d. single agency

An enforceable listing agreement does NOT have to be in writing because the... a. broker has a fiduciary relationship with the principal. b. principal has a fiduciary relationship with the broker. c. law of agency does not apply in the case of a listing agreement. d. statute of frauds does not apply to a listing agreement.

d. statute of frauds does not apply to a listing agreement.

A mechanic's lien would be properly classified as a(n)... a. equitable lien b. voluntary lien c. general lien d. statutory lien

d. statutory lien

With the exception of the innocent landowner, liability under the Superfund is... a. limited to the owner of record. b. joint and several and retroactive, but not strict. c. voluntary. d. strict, joint and several, and retroactive.

d. strict, joint and several, and retroactive.

The two major functions of local and regional planning boards are planning and... a. building code enforcement b. anti-snob zoning control c. establishing uniform zoning ordinances d. subdivision control

d. subdivision control

The principal of appraisal that dictates that home values tend to increase when demand increases is the principle of... a. progression b. substitution c. regression d. supply and demand

d. supply and demand

A tenant's lease has expired, but the tenant has not vacated the premises or negotiated a renewal lease. The landlord has declared that the tenant is not to remain in the building. This situation is an example of... a. an estate for years. b. an estate from year to year. c. tenancy at will. d. tenancy at sufferance.

d. tenancy at sufferance.

The Smith's apartment lease has expired, but their landlord has indicated to them that they may remain on the premises until a sale of the building is closed. They will be charged their normal monthly rental rate during this period. The right held by the Smiths is called a(n)... a. year-to-year holdover b. estate for term c. estate at sufferance d. tenancy at will

d. tenancy at will

In evaluating rental applications, it is important for the property manager to establish consistent criteria for acceptable debt and income ratios in order to be in compliance with... a. federal antitrust laws b. the Americans with Disabilities Act c. Regulation Z d. the Equal Credit Opportunity Act

d. the Equal Credit Opportunity Act

In a real estate transaction, the term fiduciary typically refers to... a. the sale of real property. b. the people who give someone else the legal power to act on their behalf. c. the person who has legal power to act on behalf of another. d. the agent's relationship to the principal.

d. the agent's relationship to the principal.

If you owned unit number nine in a condominium complex, what would you own? a. the tennis courts and health club b. the hallways in the building c. an equal share of each unit in the complex d. the air space within unit number nine

d. the air space within unit number nine

All of the following are valid elements of a purchase and sales agreement EXCEPT... a. the sales price b. a land description c. the contract date d. the appraised value of surrounding homes

d. the appraised value of surrounding homes

Designated agency is MOST likely to occur when... a. there is a client-buyer and a customer-seller. b. the seller and the buyer are represented by different companies. c. both the buyer and the seller are customers. d. the buyer and the seller are represented by the same company.

d. the buyer and the seller are represented by the same company.

The right of a defaulted taxpayer to recover property before its sale for unpaid taxes is... a. the statutory right of reinstatement b. the equitable right of appeal c. the statutory right of assessment d. the equitable right of redemption

d. the equitable right of redemption

Real estate taxes for the year are $4,800 and are due on June 24 of the year. If the property is sold on March 11 of that year, which of the following is correct? a. The prorated amount is $946.67 b. Debit to seller c. Credit to buyer d. All of the above

d. All of the above

Real estate taxes for the year are $4,800 and are due on June 24 of the year. If the property is sold on March 13 of that year, which of the following is correct? a. The prorated amount is $947 b. Debit to seller c. Credit to seller d. All of the above

d. All of the above

The total collection of rights which may be claimed by private ownership is best described as: a. The bundle of rights b. Fee simple system c. An estate right d. All of the above statements are true

d. All of the above statements are true

An "able buyer" means one: a. Financially able b. Having the ability to obtain the necessary funds to purchase real property c. Having the ability to obtain necessary funding d. Any of the above

d. Any of the above

When a broker misrepresents his principal's property to a buyer, he could cause his principal to be subject to: a. A court action for damages by the buyer b. A rescission of the sale by the buyer c. Civil responsibility for compensating the buyer for misrepresentation of the broker d. Any of the above

d. Any of the above

When should an Agency Disclosure form be provided to a prospective buyer or seller of real estate... a. At the first contact with the customer b. Just prior to presentation c. At the closing d. At the first personal meeting held for the purpose of discussing a specific property

d. At the first personal meeting held for the purpose of discussing a specific property

Under which of the following listing agreements can owners of listed property sell the property on their own without having to pay the listing broker a commission? a. Exclusive-right-to-sell listing b. Exclusive-agency listing c. Open listing d. Both b and c

d. Both b and c

A buyer purchased a new residence from a builder for $350,000. The buyer made a down payment of $30,000 and obtained a $320,000 mortgage loan. The builder of the house paid the lender 3% of the loan balance for the first year and 2% for the second year. This represented a total savings for the buyer of $16,000. What type of mortgage arrangement is this? a. Open-end b. Package c. Blanket d. Buydown

d. Buydown

A buyer purchases a home in an area where closings are traditionally conducted in escrow. Which item would a buyer deposit with the escrow agent before the closing date? a. Deed to the property b. Title evidence c. Estoppel certificate d. Cash needed to complete the purchase

d. Cash needed to complete the purchase

According to some states, any real property that either spouse owns at the time of marriage remains separate property. Further, any real property acquired by either spouse during the marriage (except by gift or inheritance or with the proceeds of separate property) belongs to both of them equally. What is this form of ownership called? a. Partnership b. Joint tenancy c. Tenancy by the entirety d. Community property

d. Community property

The right of ownership of real property include all of the following EXCEPT: a. Disposition b. Exclusion c. Control d. Compatibility

d. Compatibility

A broker would have the right to dictate which of the following to an independent contractor? a. Number of hours the person would have to work b. Work schedule the person would have to follow c. Sales meetings the person would need to attend d. Conduct in compliance with statutory law and regulations

d. Conduct in compliance with statutory law and regulations

Which of the following forms of ownership represents a personal property interest? a. Tenancy by the entirety b. Partnership c. Tenancy in common d. Cooperative housing

d. Cooperative housing

The annual real estate taxes on a property amount to $18,000. The seller has paid the taxes in advance for the calendar year. If the closing is set for June 15, which statement is TRUE? a. Credit the seller $8,250; debit the buyer $9,750 b. Credit the seller $18,000; debit the buyer $8,250 c. Credit the buyer $9,750; debit the seller $9,750 d. Credit the seller $9,750; debit the buyer $9,750

d. Credit the seller $9,750; debit the buyer $9,750

In an escrow, prepaid rents are normally: a. Debited to the vendor b. Credited to the vendor c. Debited to the buyer d. Credited to the buyer

d. Credited to the buyer

A father conveyed the family home to his daughter by will as a pur autre vie estate for the life of her mother. If the daughter should die before the mother, who gains possession of the property? a. Remainderman b. Mother c. Father's other children d. Daughter's heirs

d. Daughter's heirs

A proration of any prepaid utility charges is reflected on a closing statement in which of the following ways? a. Debit to the seller, credit to the buyer b. Debit to the buyer only c. Credit to the seller only d. Debit to the buyer, credit to the seller

d. Debit to the buyer, credit to the seller

Which of the following would NOT be acceptable evidence of ownership? a. Attorney's opinion b. Title insurance policy c. Abstract d. Deed to the current owner signed by the last seller

d. Deed to the current owner signed by the last seller

The tenant usually is responsible for all of the following under a net lease EXCEPT... a. Utilities b. Insurance c. Taxes d. Depreciation

d. Depreciation

A real estate broker hired by an owner to sell a parcel of real estate must comply with... a. the common law of agency in the state in which the property owner lives. b. a prospective buyer's instructions. c. the concept of caveat emptor. d. all lawful instructions of the owner.

d. all lawful instructions of the owner.

An owner of real estate has which of the following ownership rights? a. air rights b. surface rights c. subsurface rights d. all of the above

d. all of the above

The most common source of harmful lead in older residential property is in... a. asbestos b. basements c. appliances d. alkyd oil-based paint

d. alkyd oil-based paint

When a principal gives an agent the right to act on the principal's behalf, this creates... a. an agency b. a fiduciary c. an obligation of good faith and loyalty d. all of the above

d. all of the above

The federal Equal Credit Opportunity Act allows lenders to discriminate against potential borrowers on the basis of... a. preferred neighborhood b. marital status c. country of national origin d. amount of income

d. amount of income

The provision in a mortgage that permits the mortgagee to demand the full amount of the loan in the event the borrower defaults is called... a. a direct reduction clause b. a redemption clause c. an immediate possession clause d. an acceleration clause

d. an acceleration clause

A tax lien on the property can hinder the sale of a property because it is a. a monetary charge that the purchaser must satisfy b. an appurtenance that does not affect the title c. an encroachment d. an encumbrance

d. an encumbrance

A tenancy is which the tenant continues in possession after the lease has expired, without the landlord's permission is... a. a tenancy for years b. a periodic tenancy c. a tenancy at will d. an estate at sufferance

d. an estate at sufferance

A married couple co-owns a farm and has the right of survivorship. This arrangement is MOST likely... a. severalty ownership b. community property c. a tenancy in common d. an estate by the entirety

d. an estate by the entirety

Restrictive covenants can be enforced by... a. building inspector b. conservation commission c. health inspector d. anyone who is subject to the restrictions

d. anyone who is subject to the restrictions

All of the following probably would be exempt from real estate taxes EXCEPT... a. public hospitals b. golf courses operated by the park district c. synagogues and churches d. apartment buildings

d. apartment buildings

Restrictive covenants... a. are no longer effective when the title is transferred b. apply only until the developer has conveyed the title c. can be removed by a court of competent jurisdiction d. apply to and bind successive owners of the property

d. apply to and bind successive owners of the property

Restrictive covenants... a. are no longer effective when the title is transferred. b. apply only until the developer has conveyed the title. c. can be removed by a court of competent jurisdiction. d. apply to and bind successive owners of the property.

d. apply to and bind successive owners of the property.

Parking spaces in multiunit buildings, water rights, and similar things of value that convey with property are classified as... a. covenants. b. emblements. c. chattels. d. appurtenances.

d. appurtenances

A broker is permitted to represent both the seller and the buyer in the same transaction when... a. the principals are not aware of such action b. the broker is a subagent rather than the agent of the seller c. commissions are collected from both parties d. both parties have been informed and agree in writing to the dual representation

d. both parties have been informed and agree in writing to the dual representation

A title search in the public records may be conducted by... a. anyone. b. attorneys and abstractors only. c. attorneys, abstractors, and real estate professionals only. d. anyone who obtains a court order under the Freedom of Information Act.

a. anyone.

A special warranty deed differs from a general warranty deed in that the grantor's covenant in the special warranty deed: a. applies only to a definite limited time. b. covers the time back to the original title. c. is implied and is not written in full. d. protects all subsequent owners of the property.

a. applies only to a definite limited time.

Kerry has been making periodic payments of principal and interest on a loan, but the final payment will be larger than the others. This is a(n)... a. balloon payment loan b. fully amortized loan c. FHA loan d. straight loan

a. balloon payment loan

Which of the following deeds contains no express warranties? a. a bargain and sale deed b. a quitclaim deed c. a warranty deed d. a general warranty deed

a. bargain and sale deed

Tenants of a building that is being converted to a condominium will... a. be given the chance to purchase the unit they occupy. b. have to move. c. automatically become owners. d. be allowed to stay indefinitely.

a. be given the chance to purchase the unit they occupy.

When a salesperson tells homeowners that minorities are moving into the area in order to get those homeowners to sell their properties, this activity is... a. called blockbusting b. called power selling c. discriminatory advertising d. legal as long as it is true

a. called blockbusting

Six months after the buyer bought a house, the roof leaked during a rainstorm. When the house was listed the seller told the broker that the roof leaked, but they agreed not to tell any prospective buyers. The broker claims that the buyer did not ask about the roof. Under these facts, the buyer... a. can sue the broker under MCPA. b. cannot sue the broker under MCPA. c. can sue the seller under MCPA. d. cannot do anything because the leaking roof could have been discovered by inspection.

a. can sue the broker under MCPA.

The four categories of real estate appraisers recognized in Massachusetts are... a. certified general, certified residential, licensed, and trainee b. licensed general, licensed residential, licensed trainee, and certified c. qualified general, Appraisal Foundation licensed, Federal Appraisal certified, and trainee d. prelicense appraiser, precertification appraiser, appraiser, and appraiser-trainee

a. certified general, certified residential, licensed, and trainee

The history of all owners of a specific parcel of real estate is the property's... a. chain of title b. certificate of title c. title insurance policy d. abstract of title

a. chain of title

The list of previous owners of conveyance from whom the present real estate owner derives his or her title is known as the: a. chain of title b. certificate of title c. title insurance policy d. abstract of title

a. chain of title

Market value is most closely related to... a. comparable price b. replacement price c. income analysis d. reproduction price

a. comparable price

Which of the following would NOT be considered an element of value? a. comparison b. utility c. scarcity d. demand

a. comparison

The process by which government can acquire ownership of private land for public use is: a. condemnation b. escheat c. eminent domain d. doctrine of public acquisition

a. condemnation

A real estate transaction will close on November 15. The seller is responsible for costs up to and including the date of closing, and has already paid the property taxes of $5,116 for the calendar year. On the closing statement, the buyer will be... a. debited $639.50. b. debited $976.50. c. credited $639.50. d. credited $976.50.

a. debited $639.50.

Crops that grown on land and require annual planting and cultivation are called ____________. a. emblements b. fructus naturales c. real property d. fixtures

a. emblements

The purpose of Massachusetts' anti-snob law is to... a. ensure that local ordinances do not bar low-income and moderate-income housing. b. secure adequate provision of services to low-income and moderate-income residents. c. establish construction standards for low-income and moderate-income housing. d. enforce a uniform zoning law that creates mandatory low-income and moderate-income housing projects in higher-income areas

a. ensure that local ordinances do not bar low-income and moderate-income housing.

The process by which government takes control of a property after the owner dies without a will or lawful heirs is... a. escheat b. lis pendens c. condemnation d. taxation

a. escheat

The type of listing agreement that provides for payment of a commission to the broker even though the owner makes the sale without the broker's aid is called an... a. exclusive-right-to-sell listing b. open listing c. exclusive-agency listing d. option listing

a. exclusive-right-to-sell listing

The sales comparison approach to value would be MOST important when estimating the value of a(n)... a. existing residence b. apartment building c. retail location d. new residence

a. existing residence

A statement made with the intent to deceive, with the knowledge that it is untrue, is considered to be... a. misrepresentation b. caveat emptor c. execution d. ethical

a. misrepresentation

Under the terms of a net lease, a commercial tenant would usually be responsible for paying all of the following property expenses EXCEPT... a. mortgage debt service b. maintenance expenses c. fire and extended coverage insurance d. real estate taxes

a. mortgage debt service

Complaints relating to the Civil Rights Act of 1866... a. must be taken directly to federal courts. b. are no longer reviewed in the courts. c. are handled by HUD. d. are handled by state enforcement agencies.

a. must be taken directly to federal courts.

A real estate broker acting as an owner's property manager... a. must not profit from private contracts at the expense of the owner. b. may manage the client's property to the property's manager's own advantage. c. need to maintain complete and accurate trust account records. d. can personally collect the interest earned on trust account funds.

a. must not profit from private contracts at the expense of the owner.

An agent working as a facilitator... a. must present each property honestly and accurately to the buyer. b. works only for the seller. c. works only for the buyer. d. is not allowed.

a. must present each property honestly and accurately to the buyer.

A real estate broker acting as the agent of the seller... a. must promote and safeguard the seller's best interests b. can disclose the seller's minimum price c. should present to the seller only the highest offer for the property d. can accept an offer on behalf of the seller.

a. must promote and safeguard the seller's best interests

You are trying to determine the value of a three-family house for purchase. What factors would you need to determine the property value? a. net income and capitalization rates b. gross income c. property assessment d. the mortgage payments

a. net income and capitalization rates

The formula for determining the value of investment property is... a. net operating income / capitalization rate = value b. potential gross income / capitalization rate = value c. effective gross income X capitalization rate = value d. cost of replacing the property X capitalization rate = value

a. net operating income / capitalization rate = value

A broker sold a residence for $485,000 and received $26,675 as commission in accordance with the terms of the listing agreement. What was the broker's commission rate? a. 5% b. 5.5% c. 6% d. 6.5%

b. 5.5%

It is necessary to calculate a dollar value for depreciation when using which of the following? a. The sales comparison approach to value b. The cost approach to value c. The income approach to value d. Gross rent multipliers

b. The cost approach to value

Which of the following creates a lien on real estate? a. Easement running with the land b. Unpaid mortgage loan c. License d. Encroachment

b. Unpaid mortgage loan

A man agreed in writing to make a gift of his home to a friend. The agreement is best described as... a. Valid b. Void c. Voidable d. Implied

b. Void

Which of the following describes the process of creating a landfill site? a. Waste is liquefied, treated, and pumped through pipes to tombs under the water table. b. Waste and topsoil are layered in a pit, mounded up, and then covered with dirt and plants. c. Waste is compacted and sealed in a container, then placed in a tomb designed to last several thousand years. d. Waste is buried in an underground concrete vault.

b. Waste and topsoil are layered in a pit, mounded up, and then covered with dirt and plants.

Which type of insurance coverage insures an employer against MOST claims for job-related injuries? a. Consequential loss b. Workers' compensation c. Casualty d. Surety bond

b. Workers' compensation

The document that provides the borrower with general information about settlement costs, RESPA provisions, and what happens at settlement is... a. What You Should Know About RESPA b. Your Home Loan Toolkit c. the Closing Disclosure form d. the Loan Estimate form

b. Your Home Loan Toolkit

A property owner's right to sell, least;, encumber, use, enjoy, and exclude would be described as... a. a fee simple b. a bundle of rights c. a devise d. littoral

b. a bundle of rights

The income approach to value can also be called the... a. market data approach b. capitalization approach c. cost approach d. comparison approach

b. capitalization approach

A written summary of the history of all conveyances and legal proceedings affecting a specific parcel of real estate is called a(n)... a. affidavit of title b. certificate of title c. abstract of title d. title insurance policy

b. certificate of title

The closing statement involves debits and credits to the parties in the transaction. A debit is a(n)... a. refund b. charge c. adjustment for an expense paid outside of closing d. proration

b. charge

The income approach to value would be most important in the appraisal of a... a. residential condominium b. downtown office building c. single-family residence d. vacant residential lot

b. downtown office building

The right of a government body to take ownership of real estate for public use is called... a. escheat b. eminent domain c. condemnation d. police power

b. eminent domain

A method of sealing off disintegrating asbestos is called... a. capping b. encapsulation c. containment d. contamination closure

b. encapsulation

If a branch of your neighbor's pear tree extends over your property, this would be called a(n)... a. testator b. encroachment c. riparian d. littoral

b. encroachment

Most Purchase and Sale Agreements will have a clause stating the title shall be from all... a. appurtenances b. encumbrances c. riparian d. torrens

b. encumbrances

A woman does intestate and with no heirs. How did the state take the property? a. by purchase b. escheat c. adverse possession d. lis pendens

b. escheat

Capitalization is the process by which annual net operating income is used to... a. determine cost b. estimate value c. establish depreciation d. determine potential tax value

b. estimate value

A property owner's bundle of legal rights entitles the owner to do all of the following EXCEPT... a. sell the property to a neighbor. b. exclude utility meter readers. c. erect No Trespassing signs. d. enjoy profits from its ownership.

b. exclude utility meter readers.

An owner may sell his or her home and not pay a commission, even though it is exclusively listed with an agency, when he or she has a(n)... a. exclusive right to sell listing agreement b. exclusive agency listing c. net listing d. open listing

b. exclusive agency listing

A Purchase and Sales Agreement would be an example of what type of contract? a. unconscionable b. executory c. executed d. all of the above

b. executory

During the period after a real estate sales contract is signed, but before title actually passes, the status of the contract is... a. voidable b. executory c. unilateral d. implied.

b. executory

A person who has complete control of a parcel of real estate is said to own a... a. leasehold estate b. fee simple estate c. life estate d. defeasible fee estate

b. fee simple estate

The type of real estate ownership that is MOST all-inclusive is a... a. life estate b. fee simple estate c. conditional fee estate d. reversionary interest

b. fee simple estate

A lessee has a one-year leasehold interest in a house. The lease automatically renews itself at the end of each year. The lessee's interest is referred to as a tenancy... a. for years b. from period to period c. at will d. at sufferance

b. from period to period

If a house had no closets in the bedrooms, this would be an example of what type of depreciation? a. physical b. functional c. economic d. obsolescence

b. functional

A deed states that the grantors are conveying all their rights and interests to the grantees to have and to hold. This is communicated in... a. the acknowledgment clause b. the restriction clause c. the covenant of seisin d. the habendum clause

d. the habendum clause

The MOST important factor in determining whether something is a fixture is... a. the method of its attachment b. its size c. its weight d. the intention of the party who attached it

d. the intention of the party who attached it

Qualifying the buyer for a mortgage is the function of... a. the broker b. the principal c. the mortgagor d. the mortgagee

d. the mortgagee

When a tenant sublets all or any part of the premises rented under a written lease... a. the tenant assigns all rights, title, and interests in the rental property to the new lessee. b. the sublessee becomes primarily responsible to the landlord for the payment of rent and maintenance of the property. c. the original lease is automatically canceled and the sublessee takes possession of the property on a month-to-month basis. d. the original lease is unaffected unless it contains a provision that prohibits such subletting.

d. the original lease is unaffected unless it contains a provision that prohibits such subletting.

At the closing, who has the obligation to provide a "good and marketable" title? a. the buyer b. the buyer's attorney c. the home inspector d. the seller

d. the seller

Who CANNOT recommend a home inspector? a. the buyer's agent b. the buyer's brother c. the buyer's friend d. the seller's agent

d. the seller's agent

If a tenant moved out of a rented store building because access to the building was blocked as a result of the landlord's negligence, ... a. the tenant would have no legal recourse against the landlord. b. the landlord may be liable for the rent until the expiration date of the lease. c. the landlord may have to provide substitute space. d. the tenant may be entitled to recover damages from the landlord.

d. the tenant may be entitled to recover damages from the landlord.

To determine whether a location can be put to future use as a retail store, one would examine... a. the building code b. the list of permitted nonconforming uses c. the housing code d. the zoning ordinance

d. the zoning ordinance

A buyer and seller have a Purchase and Sales Agreement to close on the sale by the fifteenth day of the next month. What would be the most important factor of those listed below? a. the earnest money b. the assessed value of the property c. notarizing the Purchase and Sales Agreement d. time is of the essence

d. time is of the essence

A document that protects against hidden risks such as forgeries and loss due to deflects in the title, subject to specific exceptions, is called a(n)... a. chain of title b. abstract of title c. certificate of title d. title insurance policy

d. title insurance policy

Fiduciary relationship means that the broker owes trust and confidence to... a. all the parties b. none of the parties c. only to the seller d. to the party who hired him

d. to the party who hired him

The owner of a secluded area adjacent to an ocean noticed that people from town walked along the shore in front of his property. The owner learned that the local citizens had been walking along this beach for several years. He went to court to try to stop people from walking along the water's edge in front of his property. The owner is likely to be... a. unsuccessful because the local citizens have been doing this for years and thus have an easement. b. successful because the owner's property extends to the low-water mark. c. successful because the owner can control access to his own property. d. unsuccessful because the owner's property extends only to the high-water mark and the public may use the land beyond this point.

d. unsuccessful because the owner's property extends only to the high-water mark and the public may use the land beyond this point.

A zoning change from single family residential to multifamily residential is... a. variance b. nonconforming zoning c. bulk zoning d. upzoning

d. upzoning

A 15-year-old recently inherited a parcel of real estate and has decided to sell it. If the 15-year-old executes a deed conveying the property to a purchaser, such a conveyance would be... a. valid b. void c. invalid d. voidable.

d. voidable.

Each of two brokerage companies claimed full commission for the sale of a property that was listed by both of the firms under open listing agreements. The broker who is entitled to the commission is the one who... a. listed the property b. advertised the property c. obtained the first offer d. was the procuring cause of the sale

d. was the procuring cause of the sale

Legal title ALWAYS passes from the seller to the buyer... a. on the date of execution of the deed b. when the closing statement has been signed c. when the deed is placed in escrow d. when the deed is delivered and accepted

d. when the deed is delivered and accepted

What are the four public restrictions on private property?

1. Police Power 2. Eminent Domain 3. Taxes 4. Escheat

Chris wants to buy a house for $250,000. If his bank requires a 20% down payment, what will Chris' down payment be?

$250,000 x 0.2 = $50,000

What amount of interest does ABC Bank receive after 2 months on a $75,000 loan at 3% interest?

$375 Interest = Loan x Interest Rate x Time $75,000 x 0.03 x 0.167(2/12) = $375

What is the tax in Massachusetts of the purchase price on a deed?

$4.56 per 1,000

A property has a rental income of $1,300 per month. If the closing date is June 20, how much rent is owed to the buyer at the closing (use the 30-day method-credit closing day to seller)?

$433.30 - 30 days total - 20 days seller / 10 days buyer - Rent per day: $1,300/30 = $43.33 - Rent owed to buyer: $43.33 x 10 = $433.30

What two groups are estates divided into?

1. Freehold (ownership) 2. Non-freehold (possession)

What are the three methods of property descriptions?

- Lot, Block, and Tract - Metes and Bounds - Government (Rectangular) Survey

What are the three basic instruments to finance real estate?

- Mortgage - Trust deed - Land contract

What are the three types of agents?

- Universal - Specific - General

What are the three features that characterize fee simple?

1. It has no time limitation 2. It is freely transferable 3. It may be inherited

There are three appraisal methods used to arrive at property value. Best remembered by MCI. What are they?

1. Market Data or Sales comparison approach 2. Cost or Replacement approach 3. Income approach - Capitalization of income

There are four main forces that influence value. Best remembered by PEPS. What are they?

1. Physical 2. Economic 3. Political 4. Social

What does a state certified residential appraiser do?

1 to 4 residential properties and vacant land for improvement 1 to 4 units regardless of value

What does a state licensed appraiser do?

1 to 4 residential properties and vacant land for improvement 1 to 4 units with value less than 1MM

Explain a bridge loan.

1. A short-term commercial real estate loan intended to cover an interim period between two or more permanent loans. 2. A short-term residential real estate loan obtained by a buyer to allow the purchase of a new house before the buyer's existing house is sold, often collateralized by both parties.

In terms of lease provisions, explain an exculpatory clause.

1. Any contract provision relieving a party to the contract of some personal liability. 2. A provision in a mortgage relieving the borrower of personal liability on the loan in the event that the borrower voluntarily surrenders the property to the lender.

There are four elements of value, all of which must be present for a property to have market value. Best remembered by DUST. What are they?

1. Demand 2. Utility 3. Scarcity 4. Transferability

PITT will be on the exam. Describe the four unities that must occur for a joint tenancy to exist. Remember as PITT.

1. Possession - The joint tenants must have equal and undivided rights to possession. 2. Interest - The interest of the joint tenants must be equal. 3. Time - The joint tenants must have obtained their interest at the same time. 4. Title - The joint tenants must have obtained their interest by the same document, usually a deed.

What are the three types of life estates?

1. Pur autre vie 2. Remainder estate 3. Reversionary Estate

There is four types of licensing in Massachusetts for appraising. What are they?

1. Trainee 2. State licensed 3. State certified residential 4. State certified general

What are the two types of deeds recognized in Massachusetts?

1. Warranty Deed 2. Quitclaim Deed

Real estate does not remain constant. All property goes through four distinct changes called a neighborhood life cycle. What are they?

1. growth (development) 2. maturity (stability) 3. old age (decline) 4. revitalization (renaissance)

How many square inches are in a square foot?

144 square inches

How many feet is a rod?

16.5 feet

What is a variance?

A variance is an exception to zoning that provides relief if zoning regulations deprive an owner of the reasonable use of the property.

How many cubic feet are in a cubic yard?

27 cubic feet

The ______________________ is the total annual income from the property minus any vacancy or rental losses.

Effective gross income

How many square feet are in an acre?

43,560 feet

What are trade fixtures?

Attached and used in the ordinary course of business considered real property (Tables in a restaurant)

How many square feet are in a square yard?

9 square feet

How many feet are in a mile?

5,280 feet

How many acres are in a square mile?

640 acres

How many feet is a chain?

66 feet

How many feet is a furlong?

660 feet

Explain sale-leaseback.

A transaction in which the owner of a property sells an asset, typically real estate, and then leases is back from the buyer.

Explain a general partnership.

A business venture in which at least two co-owners operate a business for profit and in which each partner is authorized to act for and to bind the partnership.

What is radon gas?

A carcinogen, a colorless, odorless gas that can enter homes through cracks in foundations or basements.

What is designated agency?

A concept designed to enable the buyer who is represented by a buyer agent, and the seller who is represented by a seller agent in the same brokerage, to retain the benefit of the licensees they hired to be their real estate counselor and advocate.

The two words: Condominium & Cooperative, are often confused with one another. Explain the difference.

A condo owner actually owns real estate. A condo is transferred by way of a deed. A cooperative owner owns shares of stock in a corporation that owns the building.

Explain an express contract.

A contract in which all elements are specifically stated, and the terms are stated in writing to comply with the Stature of Frauds.

Explain an executory contract.

A contract in which one or both of the parties hasn't yet performed. Prior to a closing, a purchase contract would be considered executory.

Explain unilateral contract.

A contract in which one party makes an obligation to perform without receiving in return any express promise of performance from the other party, such as an open listing contract, where the seller agrees to pay commission to the first broker who brings in a ready, willing, and able buyer.

Explain encroachment.

A trespass by placing improvements (fence, shed, etc.) on or over another's land.

In terms of loan provisions, explain an alienation clause.

A contract provision, usually found in a loan secured by real estate, stipulating that the entire amount of the note must be paid, at the discretion of the noteholder, if the property is sold, contracted for sale, or leased for more than a specified period.

Explain tie-in-agreements.

A contract that depends on another contract involving the same or related parties. For example, a contract to sell a property that required the buyer to sign a commitment to resell the property through the same listing broker.

Explain an executed contract.

A contract that has fully performed. A purchase contract would be executed upon closing.

In terms of loan provisions, explain a release clause.

A contractual agreement providing that a lien as to a specifically described lot or area shall be removed from the blanket lien on the entire area upon the payment of a specific sum of money to the holder of the trust deed or mortgage.

In terms of loan provisions, explain a prepayment penalty.

A contractually established fee paid by a borrower to a lender in the event of an early payoff of all or a significant fraction of a loan.

Describe a corporation.

A corporation is an artificial but legal person created by state law, a separate entity. Shareholders have no personal liability for corporate debts.

What is an ejectment?

A court action taken by a property owner to have an encroachment removed.

What is a partition?

A court action to break up a joint tenancy or tenancy in common.

Explain an injunction.

A court order to stop specific activities.

What is an equitable lien?

A court ordered judgment that requires a debtor to pay delinquent debt.

The two words: Covenant & Condition, are often confused with one another. Explain the difference.

A covenant is a promise to do something (as in a covenant of quiet enjoyment in a deed), whereas a condition is a contingency that must be met, otherwise a particular property right could be gained or lost.

Explain the attractive nuisance doctrine.

A dangerous condition of real property that, by its nature, invites trespassers who may be injured or killed. Common examples include open pits or wells, unfenced swimming pools, and unguarded construction sites.

Explain trust deeds.

A deed of trust or trust deed is similar to a mortgage. Title is transferred to a trustee, which is usually a trust or title company that holds the real property as security for the borrower's loan. At the time the loan is paid in full, title is transferred to the borrower.

The two terms: Deed & Bill of Sale, are often confused with one another. Explain the difference.

A deed transfers legal title to real property, whereas a bill of sale transfers legal title to personal property.

What is the appraisal report?

A detailed listing of the appraisal that is usually done for the lender of the property, or by the owner, usually to establish a selling price.

Describe a condominium in terms of ownership.

A development in which there is individual fee simple ownership of a unit and shared ownership of common areas with other owners as tenants in common.

Explain the Government National Mortgage Association (Ginnie Mae).

A federal association established as a corporation owned and managed by HUD. Issues securities backed by a pool of federally insured mortgages. Issues guaranty certificates backed by the full faith and credit of the U.S. government to enhance the marketability of the securitized loans.

Explain the Federal Home Loan Mortgage Corporation (Freddie Mac).

A federally chartered corporation established for the purpose of increasing liquidity in the mortgage market.

In loan terms, what are origination fees?

A fee charged to offset a direct expense of the loan process or to otherwise compensate a lender for a loan.

What is a promissory note?

A financial document evidencing a debt and the terms under which it will be repaid.

What is private mortgage insurance?

A form of insurance developed to protect lenders who offer high loan-to-value ratio mortgage loans. Loans exceeding an 80% loan-to-value ratio may require PMI. The lender is mandated to terminate PMI when the balance reaches 78% of value.

Explain a reverse annuity mortgage.

A form of mortgage in which elderly homeowners receive monthly annuity payments from a lender based on the value of a mortgage placed on the home. The mortgage may come due on a specific date, or upon the occurrence of a particular event, such as the death of the mortgagor.

Explain encumbering the joint tenancy and tenants in common.

A joint tenant and a tenant in common can encumber his or her interest without effecting the rights of other joint tenants and tenants in common.

Describe a standard subdivision in terms of ownership.

A land development with no areas owned in common.

What is Megan's Law?

A law requiring authorities to notify communities of the whereabouts of convicted sex offenders

Explain an index lease.

A lease agreement in which the amount of future lease payments are calculated using an established index, typically the consumer price index (CPI) whereby an increase in the index will generate a corresponding increase in the lease payment to be applied.

Explain a limited liability company (LLC).

A legal form of business entity that is governed by an operating agreement and characterized by a blend of elements of a partnership and a corporation. Although state law defines the exact characteristics, LLCs enjoy shareholder liability limitations similar to those of corporations.

Explain the loan-to-value ratio.

A lending risk assessment ratio lenders examine before approving a mortgage. Assessments with high loan-to-value ratios are generally seen as higher risk and, therefore, if the mortgage is approved, the loan generally costs the borrower more to borrow.

If someone has a personal privilege to enter the land of another for a specific purpose, what allows them to do so?

A license

What does Pur Autre Vie refer to in real estate?

A life estate based on the life of the person other than the life tenant.

Explain an interest-only loan.

A loan in which only simple (not compound) interest is paid periodically. No principal is paid until the due date on the loan, when the entire principal amount is paid. Also known as a straight or term loan.

Explain a biweekly mortgage.

A loan in which the amortization provision calls for payments every two weeks, usually at half the monthly amount. The principal balance is reduced more quickly, lower total interest costs and a shorter term for the loan.

What is a nonconforming loan?

A loan in which the borrower is a high credit risk

Explain a seasoned loan.

A loan of sufficient age to establish that the borrower has made regular payments according to the terms of the note. This is a subjective criteria used by investors to determine the marketability of the loan or the prospective creditworthiness of the borrower.

In loan terms, what are loan assumptions?

A loan secured by real property that contains a provision allowing a seller of the property to transfer the loan officially into the buyer's name.

Explain an amortized loan.

A loan with scheduled periodic payments of both principal and interest.

Explain functional obsolescence.

A loss of value associated with features that have been discounted by the market, such as unfashionable design features, outdating plumbing, electrical, or heating systems, or inadequate insulation.

Explain external obsolescence.

A loss of value caused by external factors, such as the surrounding property, environment, or other factors that may decrease the property value, such as the municipality in which the subject property is located.

Explain the secondary mortgage market.

A marketplace for financial instruments where loans originated by institutional lenders and mortgage bankers are in turn sold at a discount in order to replace the funds originally advanced so that additional mortgages may be originated.

What is compound interest in loan terms?

A method of calculating interest payments in which interest is paid on accrued interest as well as on remaining principal.

What is the Torrens System?

A method of land registration

Define minor status in terms of contract negotiations.

A minor can enter into a contract and then later ask to have it voided because of minor status.

What is a lien?

A monetary claim against a property for security for a debt.

Explain an adjustable rate mortgage.

A mortgage in which the interest rate changes over the period of the loan.

Explain a purchase money loan.

A mortgage issued to the borrower by the seller of the home as part of the purchase tradition. This is usually done in situations where the buyer cannot qualify for a mortgage through traditional lending channels.

Explain an open-end mortgage.

A mortgage that allows the mortgagor to obtain additional funds from the mortgagee after the initial commitment of funds up to a stated limit. Credit card.

Explain a package mortgage.

A mortgage wherein a portion of the payment is allocated to amortizing the purchase price of personal property, especially appliances.

In terms of loan provisions, explain a grace period.

A mutually agreed upon or statutory period of time after a contract obligation is due to be performed within which performance may still be tendered without being considered a default.

What is a stigmatized property?

A negative association attributed to a particular property, reducing its marketability and value. Examples might be a murder occurring in the house, proximity to a waste dump or landfill, a history of geological problems, or a past lawsuit over construction defects. Must be disclosed if asked.

Explain a limited partnership.

A partnership regulated by state statutes, governed by a limited partnership agreement, and comprised of at least one general partner and at least one limited partner. Prohibited from having any direct management control or decision-making responsibility in the enterprise that is the subject of the limited partnership. This is a tax-advantaged form of operation.

Explain a waiver in terms of a breached contract.

A party to contract can waive a breach by the other party and choose to remain bound by the contract.

In terms of loan provisions, what are late charges?

A penalty for a delinquent payment assessed by a lending institution, landlord, or others who have the contractual right to do so.

What is a universal agent?

A person empowered to do anything the principal could do personally.

In terms of loan provisions, explain a non-disturbance clause.

A provision in a mortgage on a commercial building that provides in the event of a foreclosure on the mortgagor's/lessor's interest, those lessee's who are not in default shall have continued occupancy under their lease.

In terms of lease provisions, explain a nondisturbance clause.

A provision in a mortgage on a commercial building; provides in the event of a foreclosure on the mortgagor's/lessor's interest, those lessees' who are not in default shall have continued occupancy under their lease.

In terms of lease provisions, explain an escalator clause.

A provision of a lease which calls for an increase in rent in the event of an increase in certain costs. For example, an escalation clause may specify that rent due will increase with inflation.

In terms of loan provisions, explain an acceleration clause.

A provision usually seen in a credit document, such as a note or mortgage, giving the lender the right to demand that the entire amount of the loan be repaid immediately upon the occurrence of a specific event, such as a breach of the terms of the loan contract or the sale of the underlying security.

Explain the Federal National Mortgage Association (Fannie Mae).

A quasi-government agency that purchases real estate loans after they are originated by a lender.

Explain discount rate in regards to the Federal Reserve System.

A rate at which the Federal Reserve makes short-term funds available to member banks. Controlling the discount rate is one way the Federal Reserve attempts to influence market interest rates and is closely watched.

What is a jumbo loan?

A real estate loan larger than the maximum "conforming" loan limit. Currently, loans over $650,000 are considered super jumbo loans.

What is dual agency?

A relationship in which the brokerage firm represents both the buyer and the seller in the same real estate transaction.

What is inclusionary zoning?

A requirement to include something such as percentage of affordable units

What is a conforming loan?

A residential mortgage loan limited to an amount specified in accordance with rules established by the FNMA or FHLMC for the purchase of such loans. Currently, the conforming loan limit is $424,100.

What is the 1031 Tax Deferred Exchange?

A section of the U.S Internal Revenue Service Code that allows investors to defer capital gains taxes on any exchange of like-kind properties fir business or investment purposes.

Selling a home for less than the amount owned to the lender or mortgage company is called what?

A short sale

Explain a gross lease.

A simple commercial lease in which the lessor pays all building-related expenses, such as taxes, utilities, insurance, and maintenance.

Explain a blanket mortgage.

A single mortgage covering multiple parcels of real estate, typically used by a residential developer who purchases a number of residential lots using one mortgage.

Describe tenancy by the entirety.

A special form of ownership between husband and wife. Upon death of one spouse, the survivor becomes fee simple owner without probate.

What is a conditional use permit?

A special permit granting permission for a use otherwise not allowed under the zoning.

Define puffing in terms of contract negotiations.

A statement of opinion that may influence a party. Illegal in Massachusetts.

Explain a tenancy at sufferance.

A tenancy arising when a person who has been in lawful possession of property wrongfully remains on the property after his or her lease has expired.

Explain periodic tenancy.

A tenancy that continues as a matter of course for successive periods until one party terminates the tenancy with sufficient notice.

Explain a tenancy at will.

A tenancy that may be terminated by either party at any time and that continues only with the consent of both parties.

In terms of lease provisions, explain a recapture clause.

A term sometimes found in commercial leases allowing the landlord to retake possession of the leased premises if the tenant fails to meet financial projections that are part of a percentage lease.

Define collateral.

A thing of value pledged as security for a debt.

What is a short sale?

Selling a home for less than the amount owed to the lender or mortgage company.

An ___________________ is a provision usually seen in a credit document, such as a note or mortgage, giving the lender the right to demand that the entire amount of the loan be repaid immediately upon the occurrence of a specific event, such as a breach of the terms of the loan contract or the sale of the underlying security.

Acceleration clause

By a written agreement (lease) in advance the tenant shall remove trade fixtures at expiration of lease. Tenant is responsible for any damage caused by removal. If the tenant fails to remove trade fixtures become real property of landlord. This is known as __________.

Accession

Explain an easement by prescription.

Acquired when claimant has used another's land for 20 years, use must be open, visible and notorious

Explain reformation in terms of a breached contract.

Action to correct a mistake in agreement or deed and for parties to conform to original agreement.

Property tax is what is termed an "__________" tax.

Ad valorem

A mortgage in which the interest rate changes over the period of the loan would be considered what type of mortgage?

Adjustable Rate Mortgage

Explain a convertible adjustable rate mortgage.

Adjustable rate mortgage with a provision allowing the borrower to elect a fixed interest rate after a certain period of time.

What are prorations?

Adjustments to costs shared by the buyer and seller. Ex: $300 rent paid on the 1st of each month on a real property. Property sold on 06/15/2006 and there are 30 days in June. The seller has the right to rent up to the 14th. The buyer has the right to rent from the closing date (the 15th) to the 30th (16 days. Now we divide $300 a month by 30 days = $10 per day. The seller owes the buyer 16 days x $10 = $160.

An ______ is a relationship created when one person, the "principal," delegates to another, the "agent," the right to act on the principal's behalf in business transactions and to exercise some degree of discretion while so acting.

Agency

______________________ arises when a person ratifies an act which has already been done in his name and on his behalf by another person who in fact, had no actual authority to act on his behalf when the act was done.

Agency by Ratification

Explain expiration as a reason to terminate an agency.

Agency is for specified period of time, expiration of that period ends the agency.

Explain an exclusive agency listing agreement.

Agents get paid in this type of agreement only if they sell the property. No fee is earned if the owner alone sells the property.

Explain market allocation.

Agreement of firms to divide the marketplace on a geographic or service type basis.

__________ is a legal term for transferring ownership or interest in real property.

Alienation

_________________ is a contract provision, usually found in a loan secured by real estate, stipulating that the entire amount of the note must be paid, at the discretion of the noteholder, if the property is sold, contracted for sale, or leased for more than a specified period.

Alienation clause

United States follows the _______________ where property is owned by individuals rather than the government.

Allodial System

In terms of loan provisions, explain a default clause.

Allows a junior lienholder to cure a default of the borrower on a prior lien. If the prior lien had foreclosed, the junior lien would be wiped out.

What is cluster zoning?

Allows grouping of residences but alleviates density with green or open area

In terms of lease options, explain a renewal option.

Allows the tenant to renew the lease by giving due notice

A loan with scheduled periodic payments of both principal and interest is considered what type of loan?

Amortized Loan

In terms of loan provisions, explain an impound/escrow account.

An account designed to collect and disburse sums of money to satisfy obligations related to a parcel of real estate. An example is a property tax impound account required by a certain real estate lenders: The lender wishes to ensure the taxes are paid on time, requiring the borrowers to make monthly payments into the trust account.

Explain express agency.

An actual agency created by the written or spoken words of the principal authorizing the agent to act on behalf of the principal.

Explain a bilateral contract.

An agreement formed by an exchange of a promise in which the promise of one party is consideration supporting the promise of the other party.

Explain accord and satisfaction in terms of a breached contract.

An agreement to accept a lessor consideration than that specified in the contract.

Explain an implied contract.

An agreement which is found to exist based on the circumstances when to deny a contract would be unfair and/or result in unjust enrichment to one of the parties.

If a person has an irrevocable right or interest in the land of another, what is this called?

An easement

Explain an easement in gross.

An easement without dominant tenement, usually utility companies or a right of way. Considered a personal right

What is depreciation for tax purposes?

An expense deduction taken for an investment in depreciable property

What is redlining?

An illegal lending practice, denying real estate loans in a particular geographic area (usually those containing large minority populations) because of alleged higher lending risks without consideration of the credit-worthiness of the individual applicant.

What is appreciation?

An increase in the worth or value of property due to economic or related causes, which may prove to be either temporary or permanent

What can be used to enforce private restrictions?

An injunction

In terms of loan provisions, explain a defeasance clause.

An instrument that destroys or nullifies the force of some other instrument.

Define misrepresentation in terms of contract negotiations.

An intentional misstatement, misrepresentation, or concealment of facts so that another party is led to act in a certain way that is detriment to said party.

Define fraud in terms of contract negotiations.

An intentional statement or omission that influences another to act to his/her harm.

Explain a construction loan.

An interim loan designed to provide funds for the actual construction of improvements on land.

Explain inverse condemnation.

An owner can take action to force the condemnation of the property caused by the government action that has caused loss in value or the inability to use the property.

Explain equitable title.

An ownership interest held by one who does not have legal title to a property, but expects to receive legal title in the future.

What is an appraisel?

An unbiased estimate or opinion of the property value on a given date

Explain a time-share.

An undivided interest in a unit (tenants in common), coupled with the exclusive right of occupancy for a designated period of time each year.

A dishwasher in the box is personal property until it is installed when it becomes real property. This is known as __________.

Annexation

The principle of ____________ expresses that value is created by expectation of future benefits.

Anticipation

In terms of lease provisions, explain an estoppel certificate.

Any signed statement certifying that certain facts are true, prepared for the purpose of preventing the signatory from asserting a contrary claim at a later time.

Explain a general lien.

Apply to all property of debtor, such as a judgement lien, or IRS lien.

Explain a specific lien.

Apply to one property such as a mortgage, property tax lien, or mechanics lien.

An __________ is an unbiased estimate or opinion of the property value on a given date.

Appraisel

____________ is an increase in the worth or value of property due to economic or related causes, which may prove to be either temporary or permanent.

Appreciation

Rights and benefits that transfer or go with the land are known as _____________.

Appurtenances

Explain an easement by necessity.

Arises when land has no access to a street of public way

What is the process of combining adjacent parcels of land to form one larger parcel called?

Assemblage and plottage

An __________ is when a tenant transfers all of his leasehold rights to another party; the new tenant then pays rent directly to the landlord.

Assignment

What does a trainee appraiser do?

Assists licensed appraisers in the performance of appraisal assignments

The two words: Remainder & Reversion, are often confused with one another. Explain the difference.

At the termination of a life estate, the property may revert back to the grantor (reversion) or transfer away from the grantor when a third party remainderman is designated.

In loan terms, what does discounting a mortgage mean?

Selling an existing mortgage for less than its face value.

What is consummation?

When the consumer becomes contractually obligated to the creditor of the loan.

With the principle of _______, value is created and sustained when contrasting, opposing, or interacting elements are in a state of equilibrium. Land, labor, capitol, and management will be stable.

Balance

Explain littoral rights.

Belong to owners of land that borders commercially navigable lakes, seas, and oceans.

An agreement formed by an exchange of a promise in which the promise of one party is consideration supporting the promise of the other party, is what type of contract?

Bilateral

What type of contract is a sales agreement?

Bilateral contract

Personal property is transferred by a ____________.

Bill of sale

A loan in which the amortization provision calls for payments every two weeks, usually at half the monthly amount, is considered what type of loan?

Biweekly Mortgage

A single mortgage covering multiple parcels of real estate, typically used by a residential developer who purchases a number of residential lots using one mortgage, would be considered what type of mortgage?

Blanket Mortgage

____________ is the illegal and discriminatory practice of generating residential real estate sales for personal profit through any representation that members of a protected group may be moving into the area.

Blockbusting

Explain group boycotting.

Boycotts occur when a group of businesses agree not to do business with a particular party.

Explain liquidated damages in terms of a breached contract.

Breach of contract compensation

A short-term commercial real estate loan intended to cover an interim period between two or more permanent loans would be considered what type of loan?

Bridge Loan

A short-term residential real estate loan obtained by a buyer to allow the purchase of a new house before the buyer's existing house is sold would be considered what type of loan?

Bridge Loan

___________ are industrial and commercial sites that are abandoned or underused because of real or perceived contamination.

Brownfields

The beneficial right to use, exclude others, lease, encumber, transfer, and inherit ownership rights referred to as the ________________.

Bundle of rights

Explain the primary mortgage market.

Business within the mortgage industry that originate mortgage loans and make loans directly to borrowers. Examples include banks, savings and loans, credit unions, and mortgage bankers.

When an agent agrees to represent a buyer and use their best efforts to locate a property that meets the needs of the buyer, what type of listing agreement is this?

Buyer listing

Explain the principle of competition.

Buyers compete with each other to purchase properties. Sellers compete with each other to attract buyers to their properties.

Explain reserve requirements in regards to the Federal Reserve System.

By lowering reserve requirements of member banks, banks can lend a greater portion of their assets. Raising reserve requirements means less money available to loan.

The _____________________ are recorded at the registry of deeds and describe the rules of self-government.

Bylaws of association

Explain marketable title.

Good or clear title, reasonably free from the risk of litigation over possible defects that would be accepted by a prudent buyer.

What act was enacted in 1980, setting up a fund, called the Superfund, of $9 billion to clean up sites containing hazardous wastes?

CERCLA (The Comprehensive Environmental Response, Compensation, and Liability Act)

Explain rescission in terms of a breached contract.

Cancels the contract and returns parties to original position prior to contract.

________ measures a borrower's ability to repay a loan by comparing income against recurring debts.

Capacity

What does the Homeowners Associations do?

Care for common elements and enforce rules. Have the power to assess members.

_________ is net spendable income after all cash expenses are deducted.

Cash flow

Terminating a joint tenancy happens when one of the four unities is terminated, this is known as _________.

Cessation

Personal property is any property that is not real property, also known as ________.

Chattels

__________ is a thing of value pledged as security for a debt. In a typical mortgage, the thing of value is the property itself.

Collateral

Explain riparian rights.

Common law rights granted to owners of land along rivers, streams, or similar bodies.

The court awarded money to the injured party due to a breach of contract, this is called what?

Compensatory damages

Principle of ___________ is another of the economic principles effecting valuation. Buyers compete with each other to purchase properties. Sellers compete with each other to attract buyers to their properties.

Competition

In loan terms, a method of calculating interest payments in which interest is paid on accrued interest as well as on remaining principal would be called what?

Compound interest

A property can be condemned for use if it is structurally unsound, unfit, or unsafe for occupancy, this process is called what?

Condemnation

A ___________ is a development in which there is individual fee simple ownership of a unit and shared ownership of common areas with other owners as tenants in common.

Condominium

_____ is a Massachusetts state agency responsible for protecting human health and the environment by ensuring clean air and water, the safe management and disposal of solid and hazardous wastes, the timely cleanup of hazardous waste sites and spills, and the preservation.

DEP (Department of Environmental Protection)

A ____ is for the transfer of real property only.

Deed

A ____ is used to only transfer real property.

Deed

What is Massachusetts Property Transfer Tax sometimes called?

Deed stamps, transfer tax, or excise tax

Explain the statute of limitations.

Defines the period of time legal action can be sought.

What is the DEP?

Department of Environmental Protection is a Massachusetts state agency responsible for protecting human health and the environment by ensuring clean air and water, the safe management and disposal of solid and hazardous wastes, the timely cleanup of hazardous waste sites and spills, and the preservation.

Explain impossibility as a reason to terminate an agency.

Destruction or condemnation of the property terminates the agency.

Describe the intent test of a fixture.

Did owner intend to make it a permanent part of the structure?

When someone sells an existing mortgage for less than its face value, what is this called?

Discounting a mortgage

Explain a cooperative.

Each owner owns stock in corporation and has the right to occupy a unit under a proprietary lease.

When conducting a metes and bounds property description, in cases where the boundary is in dispute, the parties can agree to a boundary line. The agreed boundary line would be binding on future owners. This is known as ______________________________.

Doctrine of Agreed Boundaries

When the use of the water is determined by the state, and not the adjacent landowner, what is this called?

Doctrine of Prior Appropriation

Your neighbor needs to use your land for their driveway. For them to reach their property, they must crossover on your land. What would they be considered?

Dominant tenement

_____ protects one spouse against disinheritance. A spouse's right to life estate or ownership interest upon death of other spouse.

Dower

Explain dower.

Dower protects one spouse against disinheritance. A spouse's right to life estate or ownership interest upon death of other spouse.

What is Ginnie Mae?

Government National Mortgage Association

Scarcity, improvements, permanence of investment, and area preference are all considered what?

Economic characteristics of real property

_____ is a federal agency that oversees restrictions regarding the sale of contaminated property.

EPA (Environmental Protection Agency)

When a property owner is concerned about encroachment from a neighbor, what court action can they take to have the encroachment removed?

Ejectment

The government has the right to take property for the public good through condemnation. What is this called?

Eminent domain

What did the Civil Rights Act of 1968 do?

Enacted to prohibit discrimination on the basis of race, color, national origin, religion in the sale or lease of most dwellings and vacant land intended to be used for dwellings.

When a neighbor's fence crosses over into your land, what is this called?

Encroachment

What federal law can limit real property use and development?

Endangered Species Act of 1973

What is the EPA?

Environmental Protection Agency is a federal agency that oversees restrictions regarding the sale of contaminated property.

A homeowner receives a court ordered judgement, requiring them to pay their delinquent debt, what type of lien is this considered?

Equitable

What type of title would involve an ownership interest held by one who does not have legal title to a property, but expects to receive legal title in the future?

Equitable title

______ is that interest or value remaining in property after payment of all liens or other charges on the property.

Equity

When land experiences a gradual loss from water or wind, what is this called?

Erosion

In terms of lease provisions, if there is a provision in a lease which calls for an increase in rent in the event of an increase in certain costs, what is this called?

Escalator clause

The owner of a home dies without a will. He has no legal heirs, thus, the property reverts to the state. What is this process called?

Escheat

An ______ is the degree or nature of the ownership interest a person has in real property.

Estate

In terms of lease provisions, any signed statement certifying that certain facts are true, prepared for the purpose of preventing the signatory from asserting a contrary claim at a later time, is known as what?

Estoppel certificate

When an agent only gets paid if they sell the property, what type of listing agreement is this?

Exclusive agency listing

Explain the Three Day Rescission Right.

On loans secured by borrower's residences, the borrower has the right to reconsider and cancel.

A contract in which all elements are specifically stated, and the terms are stated in writing to comply with the Stature of Frauds, is what type of contract?

Express

______________ is an actual agency created by the written or spoken words of the principal authorizing the agent to act on behalf of the principal. A listing agreement is an example of ______________. *One Answer*

Express agency

Which of the following acts as an insurance agency? a. Fannie Mae b. Freddie Mac c. FHA d. VA

FHA

What does HUD require of sellers in regards to lead paint?

For housing built prior to 1978, HUD requires sellers and lessors must disclose any known lead paint hazards to buyers or lessees. A lead paint disclosure booklet, "Protect Your Family from Lead Paint" must be given to buyers and lessees.

Explain a specific performance in terms of a breached contract.

Force party to complete deal rather than money damages.

Define duress in terms of contract negotiations.

Forced to enter into a contract or a threat of force to enter into a contract may be voided by the injured party.

A procedure by which the holder of a mortgage has an interest in land providing security for the payment of a debt sells the property upon the failure of the debtor to pay the mortgage debt, and, thereby, terminates his or her rights in the property. What is this called?

Foreclosure

Explain Urea Formaldehyde Foam (UFFI).

Formerly used as insulation, this substance emits an irritating gas as it deteriorates.

During contract negotiations, an intentional statement or omission that influences another to act to his/her harm is known as what?

Fraud

What is a life estate?

Freehold estate limited in duration to the life of the owner or the life of some other designated person or persons. Unlike other freehold estates, a life estate is not inheritable.

Natural growing plants, perennial crops, and trees are considered real property. The term for this is _________________.

Fructus Naturales

What are crops that are annually planted known as?

Fructus industriales or Emblements or Personal property

What did the Civil Rights Act of 1866 do?

Gave all citizens the same rights as those enjoyed by white citizens; to inherit, lease, sell, or hold real and personal property.

What type of agent is a property manager?

General agent

A ___________________ is a business venture in which at least two co-owners operate a business for profit and in which each partner is authorized to act for and to bind the business.

General partnership

In terms of lease options, explain the right-to-purchase option.

Gives the tenant the right to purchase the property at a specified price within a specified time. When the time elapses, the option expires.

In terms of lease options, explain the right-of-first-refusal option.

Gives the tenant the right to purchase the property for the same price and conditions.

Describe fee simple determinable.

If a deed specifies that a grant shall be only "for as long as" or while a property is in a particular use, the length of the estate is determined by the deed. Use for another purpose would automatically end the estate, and no action of the grantor would be necessary.

Explain escheat.

If a landowner dies without a will and without legal heirs, the property reverts to the state through escheat.

Explain nominal damages in terms of a breached contract.

If there is no dollar loss, a token amount is awarded.

Explain a net listing agreement.

Illegal in Massachusetts. The agent gets to keep everything he can get that's more than the sale price the owner wants.

What are the three physical characteristics of real property?

Immobility, indestructibility, uniqueness

______________ is created by implication when, from the nature of the principal's business and the position of the agent within that business, the agent is deemed to have permission from the principal to undertake certain acts.

Implied agency

What is known as the Doctrine of Agreed Boundaries?

In cases where the boundary is in dispute, the parties can agree to a boundary line.

In loan terms, what are points?

In lending, a charge equal to 1% of the loan amount, paid to a lender or mortgage broker as an inducement to grant the loan.

In terms of mortgage, explain title theory.

In title theory states (Massachusetts), a lender holds the actual legal title to a piece of real estate for the life of the loan while the borrower/mortgagor holds the equitable title

What are the elements of real property?

Includes land and improvements, rights and benefits that transfer or go with the land, such as buildings, fences, trees, water rights, surface, sub-surface, to the heavens above known as air rights, mineral rights, and easements.

A real estate agent needs to appraise a property that generates an income. She takes the appraisal approach that is used for apartments, office buildings, malls, etc. Which appraisal method did the real estate agent decide to go with?

Income approach

Explain compensatory damages in terms of a breached contract.

Money awarded by court to the injured party.

The measuring points in a metes and bounds property description are known as _________.

Monuments

A ________ is a written agreement that creates a lien on real property, the main purpose is to secure a loan.

Mortgage

Loan-to-Value Ratio = _______________ / ___________________________.

Mortgage Amount / Appraised Value of Property

A lease that includes the provision that the lessee pay some or all of the expenses of operating the property such as property taxes, insurance, utilities, repairs, and maintenance, is known as what type of lease?

Net lease

What type of listing agreement is illegal in Massachusetts?

Net listing

The ____________________ is the income after paying all expenses including vacancy and a maintenance reserve. It does not include the principal and interest paid on a loan.

Net operating income

What is cash flow?

Net spendable income after all cash expenses are deducted

Because of a breached contract, the court awarded a token amount to the injured party because there was no money lost, this is called what?

Nominal damages

A ______________________ is a provision in a mortgage on a commercial building that provides in the event of a foreclosure on the mortgagor's/lessor's interest, those lessee's who are not in default shall have continued occupancy under their lease.

Non-disturbance clause

In terms of lease provisions, a lease must be acknowledged. For a lease to be recorded, they must be _________.

Notarized

When two parties decide to substitute a new contract for the old one, what is this called?

Novation

Describe a planned unit development in terms of ownership.

Offers individual lot ownership, with common areas owned by all owners as tenants in common.

When a seller has the right to use as many brokers as they want, and they only have to pay commission if they sell with the help of a broker, what type of listing agreement is this?

Open listing

What is conservation zoning?

Open zoning that excludes development to keep an area in natural condition

A mortgage that allows the mortgagor to obtain additional funds from the mortgagee after the initial commitment of funds up to a stated limit would be considered what type of mortgage?

Open-End Mortgage

An ______ is an agreement between two parties that provides one of the parties with the right but not the obligation to buy, sell, or obtain a specific asset at an agreed upon price at some time in the future. An ______ is a unilateral contract until it is exercised, wherein it becomes a bilateral contract which binds the two parties to fulfill their obligations in the project. *One Answer*

Option

In loan terms, a fee charged to offset a direct expense of the loan process or to otherwise compensate a lender for a loan would be called what?

Origination Fees

Explain a common interest subdivision in terms of ownership.

Owners have interest in common areas.

A mortgage wherein a portion of the payment is allocated to amortizing the purchase price of personal property, would be considered what type of mortgage?

Package Mortgage

A court action to break up a joint tenancy or tenancy in common is called _________.

Partition

__________ leases are usually executed in retail mall outlets. This type of a lease scheme requires the renter to pay a "Base rent" plus a percentage of the monthly sales volumes.

Percentage

Explain a percentage lease.

Percentage leases are usually executed in retail mall outlets. This type of a lease scheme requires the renter to pay a "Base rent" plus a percentage of the monthly sales volumes.

A tenancy that continues as a matter of course for successive periods until one party terminates the tenancy with sufficient notice is known as what kind of lease?

Periodic tenancy

What are chattels?

Personal property

_________________ is transferred by a Bill of Sale.

Personal property

Regarding inheritance, what does bequest or legacy mean?

Personal property given by will

What is the biggest difference between real and personal property?

Personal property is considered movable

What are fructus industriales?

Personal property that is cultivated into the land (Annual crops)

Property is divided into two categories: Property may be classified as either _________________ or ______________.

Personal property; Real property

Immobility, indestructibility, and uniqueness are all considered what?

Physical characteristics of real property

Explain a judgement lien.

Placed on real and personal property after final court that defendant must pay plaintiff an amount of money.

A ________________________ offers individual lot ownership, with common areas owned by all owners as tenants in common.

Planned Unit Development

Metes and bounds property descriptions are given in a clockwise manner starting at the __________________ and ending at the _______________.

Point of Beginning; Point of Ending

In lending, a charge equal to 1% of the loan amount that is paid to a lender or mortgage broker as an inducement to grant the loan is called what?

Points

Explain how the element of political force influences value.

Political forces that can affect value are: building codes, zoning laws, public health measures, fire regulations, rent controls, environmental legislation, and the community economic base

Tenants in common have equal and individual rights of __________.

Possession

What does PITT stand for?

Possession Interest Time Title

When land forms after water recedes, what is this called?

Reliction

When the creator of the life estate names a remainderman as the person to whom the property will pass when the life estate ends, this is known as?

Remainder estate

Which lease option allows the tenant to renew the lease by giving due notice?

Renewal option

What is a real estate broker's responsibility in regards to home inspection disclosure?

Required to distribute a brochure, "The Importance of a Home Inspection" to home buyers. Should be given to the buyer prior to signing an offer to purchase.

When a contract is cancelled and the two parties return to their original position prior to the contract, this is called what?

Rescission

A limitation to the use of property imposed by the past or current owner that runs with the land is called what?

Restrictive covenant

A form of mortgage in which elderly homeowners receive monthly annuity payments from a lender based on the value of a mortgage placed on the home is considered what type of mortgage?

Reverse Annuity Mortgage

What are appurtenances?

Rights and benefits that transfer or go with the land (Buildings, fences, trees, parking spaces, water rights, surface rights, sub-surface rights, air rights, mineral rights, easements, etc.)

A homeowner was granted common law rights of land along a river. What are these rights called?

Riparian rights

A transaction in which the owner of a property sells an asset, typically real estate, and then leases is back from the buyer, is known as what?

Sale-leaseback

A real estate wants to choose the easiest and most commonly used appraisal method. He chooses the best for single-family homes or condominiums and vacant lots because sales information is readily available. Which appraisal method did the real estate agent decide to go with?

Sales Comparison Approach

What is the formula for GRM (Gross Rent Multiplier)? ___________ / ____________ = GRM

Sales Price / Monthly Rent

What are the four economic characteristics of real property?

Scarcity, improvements, permanence of investment, area preference

A loan of sufficient age to establish that the borrower has made regular payments according to the terms of the note would be considered what type of loan?

Seasoned Loan

The two terms: Secondary Financing & Secondary Mortgage Market, are often confused with one another. Explain the difference.

Secondary financing is a second or junior loan, and secondary mortgage market is the purchase and sale of existing loans.

In terms of loan provisions, explain assignment of rents.

Security device by which lienholder has the right to collect rents from the property owner's tenants.

The actual possession of real property under claim of a freehold state, when the grantor warrants the right to sell or convey, is called what?

Seisin

Explain an open listing agreement.

Sellers have the right to use as many brokers as they want. To earn a commission the broker must be the procuring cause. The seller is not obligated to pay any of them if they sell the property without a broker's help.

Your neighbor needs to use your land for their driveway. For them to reach their property, they must crossover on your land. What would you be considered?

Servient tenement

A growing tree is real property, but when it is cut down for fire wood it becomes personal property. This is known as _________.

Severance

How long is the statute of limitations in Massachusetts?

Six years

Explain how the element of social force influences value.

Social ideals and standards can affect value. Population growth and decline, age, marriage, birth, divorce, and death rates, attitude toward recreation all combine to cause changes in social patterns.

A ___________________ is the simplest business form under which one can operate a business. It is not a legal entity. It simply refers to a person who owns the business and is personally responsible for its debts.

Sole proprietorship

What is it called when the court forces a party to complete a new deal rather than award money damages for a breached contract?

Specific performance

Explain a mechanics lien.

Specific, involuntary lien placed on real property for nonpayment of services.

What is interest in loan terms?

Specified or promised periodic return on a cash advance, in exchange for use of the money.

A land development with no areas owned in common is called a ____________________.

Standard Subdivision

Describe the lot, block, and tract method of property descriptions.

State and/or local subdivision law requires recording of a subdivision map or plat map. This legal description uses the parcel's designation on the recorded map as well as recording information.

What requires that certain documents be in writing, such as real property titles and transfers, leases for more than a year, wills, and some types of contracts?

Statute of Frauds

What defines the period of time legal action can be sought?

Statute of Limitations

A real estate tax lien is an example of what kind of lien?

Statutory

________ is the illegal practice of showing or presenting properties to buyers who are members of a protected class (race, ethnicity, handicap, family status, etc.) in a manner designed to keep that protected class isolated to a particular area.

Steering

Explain wetlands.

Swampy areas that are seasonal covered with water support plant, animal, bird life. Subject to federal, state, and local controls aimed at preservation

Explain an ad valorem tax.

Tax based on the value of the property itself

A tenancy arising when a person who has been in lawful possession of property wrongfully remains on the property after his or her lease has expired is known as what kind of lease?

Tenancy at sufferance

A tenancy that may be terminated by either party at any time and that continues only with the consent of both parties is known as what kind of lease?

Tenancy at will

A husband and wife have established a special form of ownership that makes the survivor of the two the fee simple owner without probate. This is known as _______________________.

Tenancy by the Entirety

Undivided interest by two or more parties without the right of survivorship is known as _________________.

Tenancy in Common

A-B-C are Joint Tenants. C sells to D. D becomes a ________________ with A and B as Joint Tenants.

Tenant in Common

The ____ is the length of a rental.

Term

In terms of lease terminations, explain a merger.

Terminates if the lessor and lessee become the same person.

Explain performance as a reason to terminate an agency.

Terminates when the agent has performed the duties stated in the agreement.

What is cessation?

Terminating Joint Tenancy

What is equity?

That interest or value remaining in property after payment of all liens or other charges on the property.

Explain the transferability element of value.

That title to property is unclouded and marketable. An interest that can't be transferred has no value.

What is CERCLA?

The Comprehensive Environmental Response, Compensation, and Liability Act was enacted in 1980, setting up a fund, called the Superfund, of $9 billion to clean up sites containing hazardous wastes.

What is the Civil Rights Act of 1968 also known as?

The Federal Fair Housing Act

Explain open market transactions in regards to the Federal Reserve System.

The Federal Reserve System can buy and sell federal securities in the open market, buying securities puts more money into the economy while selling securities takes money out of the economy.

Explain money supply in regards to the Federal Reserve System.

The Federal Reserve System can create money to match the supply of currency in circulation to the growth needs of the economy.

In terms of mortgage, explain lien theory.

The borrower holds title to the property and gives the lender a lien on the property. Once recorded at the county deeds office the lien is perfected. When the lien is paid off the borrower receives a satisfaction of mortgage, and when recorded removes the lien.

Define market value.

The cash price a willing, informed buyer would pay to a willing, informed seller in an open market, allowing a reasonable marketing time, under normal conditions and an "arm's length transaction."

In terms of loan provisions, explain a power of sale clause.

The contractual right of a lienholder to sell property serving as collateral for a loan or other obligation without judicial action in the event of a default.

Describe a remainder estate.

The creator of the life estate may name a remainderman as the person whom the property will pass when the life estate ends.

Describe a reversionary estate.

The creator retains revisionary interest upon the end of the life estate ownership reverts back to creator

Explain death/incapacity as a reason to terminate an agency.

The death/incapacity of either the principle or broker, not salesperson, terminates the agreement.

What is an estate?

The degree or nature of the ownership interest a person has in real property. The words "estates" and "interests" are interchangeable.

What is a master deed?

The enabling declaration recorded at the county registry of deed.

Define accretion.

The gradual buildup of land by action of water

Define erosion.

The gradual loss of land by action of water or wind

The two words: Grantor & Grantee, are often confused with one another. Explain the difference.

The grantor (seller) transfers legal title to the grantee (buyer) using a deed.

Describe fee simple or fee simple absolute.

The highest form of ownership possible in real property and most common.

What is blockbusting?

The illegal and discriminatory practice of generating residential real estate sales for personal profit through any representation that members of a protected group may be moving into the area.

Explain price fixing.

The illegal cooperative or collusive setting of price levels by competitors within an industry.

What is steering?

The illegal practice of showing or presenting properties to buyers who are members of a protected class (race, ethnicity, handicap, family status, etc.) in a manner designed to keep that protected class isolated to a particular area, or to introduce those of a protected class to an area with the intent of generating unstable market conditions.

In terms of lease provisions, the lessor is also known as what?

The landlord

What is alienation?

The legal term for transferring ownership or interest in real property.

Explain preapproval.

The lenders indication that they are willing and able to make the loan to the applicant when a suitable property has been secured by a real estate contract.

What does usury mean in loan terms?

The lending of money at rates in excess of those permitted by applicable law. In Massachusetts the rate is 20%.

In terms of lease provisions, what is considered a term?

The length of the rental

What are monuments?

The measuring points used in a metes and bounds property description.

Sam Seller must walk away with at least $70,000 from the sale of his house. If he assumes that his costs will be 7% of the sales price, what is the minimum sales price Sam should accept?

The minimum sales price that Sam should accept is $75,269. $70,000 / 0.93 = $75,269

Explain the principle of conformity.

The more that structures are in harmony with one another, the more valuable each of those structures.

The two words: Mortgagor & Mortgagee, are often confused with one another. Explain the difference.

The mortgagor (borrower) gives the mortgage (note) to the mortgage (lender). The mortgage thus pledges the property as collateral for the loan, and promises repayment of money.

Describe the metes and bounds method of property descriptions?

The oldest method of describing land. Metes means to measure, and bounds means linear directions. The method shows the boundaries of a parcel by measuring from point to point.

Explain a servient tenement.

The party whose property is crossed over and used for the benefit of another (Serves), causing an encumbrance

Explain a dominant tenement.

The party with the right to crossover and receives the benefit of the easement (Dominates)

What is economic life?

The period during which the improvements contribute to the net income.

Explain subjective value.

The personal use value of the benefits of ownership

In terms of loan provisions, explain a lock-in clause.

The point in the loan application process where the interest rate and terms of the loan are guaranteed.

In terms of lease provisions, the property address is often called "____________".

The premises

Define value.

The present worth of rights to future benefits that come from property ownership

What is assemblage and plottage?

The process of combining adjacent parcels of land to form one larger parcel

What is annexation?

The process of turning personal property into real property.

What is severance?

The process of turning real property into personal property.

In terms of lease provisions, what is considered the premises?

The property address

Explain the right of first refusal.

The right granted by a property owner to any other person to have the first opportunity to purchase or lease a specific property at such time as the owner has a bona fide offer to lease or purchase from a third party.

In terms of lease provisions, explain a covenant of quiet enjoyment.

The right of a tenant or owner to use property without interference from others claiming the right to use the property.

Explain taxes in terms of public restrictions on private property.

The right to tax & assess. Nonpayment becomes priority claim against the property

Explain effective age.

The structures age for appraisal purposes, effective age can differ from chronological age, depending on the condition of the structure. Example, a 10-year-old building that is well maintained might have an effective age of 6, whereas a similar 10-year-old building might have an effective age of 15.

Define avulsion.

The sudden tearing away of land by action of water

In terms of lease provisions, the lessee is also known as what?

The tenant

What is leverage?

The use of borrowed funds to purchase investment property with the anticipation that the property acquired will increase in return so that the investor will realize a profit not only on his own investment, but also on the borrowed funds; the employment of a smaller investment to generate a larger rate of return through borrowing.

Explain the Doctrine of Prior Appropriation.

The use of the water is determined by the state not the adjacent landowner

Explain the principle of regression.

The value of a superior property will be worth less because of the presence of lower-valued properties nearby.

Explain assessed value.

The value placed by the local assessors for taxation purposes

Explain the principle of contribution.

The worth of an improvement as well as what it adds to the entire property's market value, regardless of the actual cost. A pool may not add value to a property equal to the cost, but remodeling a bathroom might.

What are asbestos?

These fibers are resistant to heat, fire, and chemicals and do not conduct electricity. They have been mined and used widely in the construction, automotive, and other industries. Asbestos dust has been found to cause respiratory problems and is no longer used.

Explain how the element of economic force influences value.

These forces are natural forces, industrial and commercial trends, employment trends, wage levels, availability of money-credit, interest rates, price levels, tax loads, regional & community economic base, new development, rental and price patters.

Explain a triple net lease.

This type of an arrangement is commonly used in freestanding facilities. In a triple net lease plan, the tenant pays a fixed rent and a significant share of the operating expenses, taxes and insurance.

Office record keeping is the responsibility of the broker and should include transaction records. How long should these records be kept for?

Three years

A __________ is an undivided interest in a unit, coupled with the exclusive right of occupancy for a designated period of time each year.

Time-Share

The buyer of a property will usually purchase _____ insurance, which protects the buyer from any _____ problems that may arise after the sale (such as liens that were missed during the _____ search). *One answer

Title

A-B-C are Joint Tenants. A dies. B-C are Joint Tenants. B-dies. C owns as __________________.

Title in Severalty

What is the difference between title and deed?

Title is a bundle of rights associated with the home or property. It is not a paper document like it is on a car. Deed is a legal, paper document, conveys ownership interest in the property, transferring title from one person to another.

Explain the utility element of value.

To have value a property must have a useful purpose.

Why was the Real Estate Settlement Procedures Act established?

To provide consumers with improved disclosures of settlement costs to reduce the costs of closing by the elimination of referral fees and kickbacks.

What is a bill of sale used for?

To transfer personal property

What is a deed used for?

To transfer real property

What is the Gross Rent Multiplier used for?

To value residential properties with 1 to 4 unites

What are examples of natural monuments in a metes and bounds property description?

Trees, rocks, rivers, etc.

This type of an arrangement is commonly used in freestanding facilities. In a ________________ plan, the tenant pays a fixed rent and a significant share of the operating expenses, taxes and insurance.

Triple net lease

Explain a ground lease.

Typically a long-term lease, as lease holders would be unwilling to build costly improvements if the benefit of such improvements could only be realized for a small number of years.

When terms of a contract are so outrageous that they benefit one party over another party, this is called what?

Unconscionable

When someone is forced to enter a contract, they are considered what?

Under duress

Describe tenancy in common.

Undivided interest by two or more parties without the right of survivorship. Possession is the only one of the four unities required.

What is joint tenancy?

Undivided ownership by two or more people with the right of survivorship.

During a contract negotiation, when one party has an overpowering relationship, rather than voluntary, this is called what?

Undue influence

A contract in which one party makes an obligation to perform without receiving in return any express promise of performance from the other party, is what type of contract?

Unilateral

In loan terms, the lending of money at rates in excess of those permitted by applicable law would be called what?

Usury

_____ is the present worth of rights to future benefits that come from property ownership.

Value

Explain the principle of balance.

Value is created and sustained when contrasting, opposing, or interacting elements are in a state of equilibrium. Land, labor, capitol, and management will be stable.

Explain the principle of anticipation.

Value is created by expectation of future benefits

Explain the principle of substitution.

Value is set by the cost of getting an equally desirable substitute. An owner cannot expect to sell for more than someone would ordinarily pay for a similar property, under similar conditions.

Explain the principle of progression.

Value of an interior property will be worth more because of the presence of greater-valued properties nearby

A ________ is an exception to zoning that provides relief if zoning regulations deprive an owner of the reasonable use of the property.

Variance

If a homeowner intentionally requests a mortgage loan, what type of lien is this considered?

Voluntary

Explain a deed.

Voluntary transfer documents for an interest in real estate.

When one party ignores a breach in contract by the other party and chooses to remain bound by the contract, this is called what?

Waiver

In Massachusetts, a ________ deed generally offers the greatest amount of protection to someone who is purchasing or receiving the title to a piece of real estate.

Warranty

A homeowner has swampy areas around his land that are under state control for preservation purposes, what is this known as?

Wetlands

Explain agency by ratification.

When a person ratifies an act which has already been done in his name and on his behalf by another person who in fact, had no actual authority to act on his behalf when the act was done.

In terms of lease provisions, explain a holdover clause.

When a tenant fails to vacate the leased premises at the end of the lease term and the landlord continues to accept rental payments, the common law presumption is that the parties have agreed to extend the lease on a month-to-month basis, subject to the original terms of the underlying lease.

What is an assignment?

When a tenant transfers all of his leasehold rights to another party; the new tenant then pays rent directly to the landlord.

Define undue influence in terms of contract negotiations.

When one party has an overpowering relationship rather than voluntary.

Explain the demand element of value.

Without demand, there is no value. Effective demand is desire coupled with purchasing power.

Who hears requests for zoning variances?

Zoning Board of Appeals (BOA)

What is bulk zoning?

Zoning for density using setbacks, height restrictions, parking requirements, etc.

What is spot zoning?

Zoning of parcel inconsistent with surrounding uses. Illegal in Massachusetts

Explain zoning.

Zoning ordinances set height restrictions, setbacks, minimum lot sizes, etc. Local officials set zoning. There are no federal zoning laws.

What is exclusionary zoning?

Zoning that specifically prohibits a use, such as adult entertainment venues

What is upzoning?

Zoning to a less restrictive use

What is downzoning?

Zoning to a more restrictive use

A real estate company has adopted a 100% commission plan. The monthly desk rent required of sales associates is $1,500, payable on the last day of the month. In August, a sales associate closed a transaction that earned a commission of $11,370 and a second transaction that earned a commission of $6,875. The sales associate's additional expenses for the month were $2,170. How much of the total monthly income did the sales associate keep? a. $14,575 b. $16,075 c. $16,745 d. $18,245

a. $14,575

The fine for a first violation of the federal Fair Housing Act could be as much as... a. $19,987 b. $37,525 c. $65,654 d. $100,000

a. $19,987

On the sale of a single-family primary residence, an individual has a capital gain exclusion of... a. $250,000 b. $500,000 c. $750,000 d. zero

a. $250,000

If the annual net income from certain commercial property is $22,000 and the capitalization rate is 8%, what is the value of the property using the income approach? a. $275,000 b. $176,000 c. $200,000 d. $183,000

a. $275,000 value of property - $22,000 net income divided by 8% cap rate

A seller wants to $330,000 from the sale of property and the broker's commission is 5%. What should the listing price be? a. $347,368 b. $346,500 c. $345,313 d. $330,000

a. $347,368

A buyer has deposited 10% of the sales price of a condominium with the broker as earnest money, and the bank has agreed to lend $51,000, which is 80% of the sales price. How much additional funding must the buyer provide to complete this transaction? a. $6,375 b. $5,100 c. $5,500 d. $6,125

a. $6,375

The seller-landlord has collected the September rent from all five tenants: two paying $345 per month each, and three paying $425 per month each. Determine the prorated amount to be allowed the buyer when the sale closes on September 19th. a. $720.50 b. $786.00 c. $1,244.50 d. $1,965.00

a. $720.50 - ($345 x 2) + ($425 x 3) = $690 + $1,275 = $1,965 total rent - $1,965 divided by 30 days in September = $65.50 daily rent - 30 days in September - 19 days = 11 days buyer due rent - 11 days x $65.50 daily rent = $720.50 rent due to buyer

A small office building sold for $949,000 and the broker received a commission of $54,990. What was the broker's commission rate? a. 5.8 percent b. 6.2 percent c. 7 percent d. 11.3 percent

a. 5.8% commission rate - $55,042 commission divided by $949,000 sales price = 5.8% commission rate

If a property's annual net income is $24,000 and it is valued at $300,000, what is its capitalization rate? a. 8% b. 10.5% c. 12% d. 15%

a. 8%

If the selling price of a property is $300,000 and the bank requires a $60,000 down payment, then the loan-to-value ratio would be... a. 80% b. 70% c. 40% d. 10%

a. 80%

A one acre site has a 40x100 foot office building. The building occupies what percentage of the site? a. 9.2% b. 9.2% c. 11.1% d. 2.5%

a. 9.2%

Which of the following is considered dual agency? a. A broker acting for both parties in the same transaction b. Two brokerage companies cooperating with each other c. A broker representing more than one principal d. A broker listing a property and then, after it is relisted with another broker, selling the same property

a. A broker acting for both parties in the same transaction

Which of the following would be considered dual agency? a. A broker acting for both the buyer and the seller in the same transaction. b. Two brokerage companies cooperating with each other. c. A broker representing more than one principal. d. A broker listing and then selling the same property.

a. A broker acting for both the buyer and the seller in the same transaction.

Another name for depreciation is: a. A cost recovery b. Leverage c. Capital gain d. Inflation

a. A cost recovery

Who is entitled to a reverse mortgage? a. A homeowner age 62 or older b. The owner of an unencumbered home c. A homebuyer who cannot qualify for a regular loan d. An investor who rents a home only to senior citizens

a. A homeowner age 62 or older

Which of the following is NOT necessary for a broker to be entitled to a commission? a. A signed listing agreement b. A ready, willing, and able buyer c. Closing of title by purchaser d. A binding contract between seller and purchaser

a. A signed listing agreement

The seller conveyed a quitclaim deed to the buyer. Upon receipt of the deed, the buyer may be certain that... a. All of the seller's interest in the property, if any, belongs to the buyer. b. The seller owned the property. c. There are no encumbrances against the property. d. The buyer now owns the property subject to certain claims of the seller.

a. All of the seller's interest in the property, if any, belongs to the buyer.

Which of the following describes a gross lease? a. An agreement in which the tenant pays a fixed rent and some or all of the utilities and the landlord pays all taxes, insurance, and expenses related to the property b. A lease in which the tenant pays rent plus some of the operating expenses related to the property c. A lease in which the tenant pays the landlord a percentage of the monthly income derived from the property d. An agreement allowing the tenant to terminate the lease if certain conditions near the premises become unbearable

a. An agreement in which the tenant pays a fixed rent and some or all of the utilities and the landlord pays all taxes, insurance, and expenses related to the property

Which of the following is a variance? a. An exception to a zoning ordinance b. A court order prohibiting certain activities c. A reversion of ownership d. A nullification of an easement

a. An exception to a zoning ordinance

A woman owns 50 acres of land with 500 feet of frontage on a desirable recreational lake. She wishes to subdivide the parcel into salable lots, but she wants to retain control over the lake frontage while allowing lot owners to have access to the lake. Which of the following types of access rights would provide the greatest protection for a prospective lot purchaser? a. Appurtenant easement b. Easement in gross c. Easement by necessity d. License

a. Appurtenant easement

What do liens and easements have in common? a. Both are encumbrances. b. Both must be on public record to be valid. c. Neither can be done without the consent of the owner. d. Both are money claims against the property.

a. Both are encumbrances.

Zoning powers are conferred on municipal governments in which of the following ways? a. By state enabling acts b. Through the master plan c. By popular local vote d. Through city charters

a. By state enabling acts

A sells a portion of property to B. B promptly records the deed in the appropriate county office. If A tries to sell the same portion of property to C, which of the following statements is TRUE? a. C has been given constructive notice of the prior sale because B promptly recorded the deed. b. C has been given actual notice of the prior sale because B promptly recorded the deed. c. Because C's purchase of the property is the more recent, it will have priority over B's interest, regardless of when B recorded the deed. d. Because C purchased the property from its rightful owner, C is presumed by law to be aware of B's prior interest.

a. C has been given constructive notice of the prior sale because B promptly recorded the deed.

A real estate sales associate represents a buyer. At their first meeting, the buyer reveals plans to operate a doggrooming business out of the purchased house. The sales associate did not check the local zoning ordinances to determine in which parts of town such a business could be conducted. Which common law duty did the sales associate violate? a. Care b. Obedience c. Loyalty d. Disclosure

a. Care

While moving into a newly purchased home, the buyer discovered that the seller had taken the ceiling fan that hung over the dining room table. The seller had not indicated that the ceiling fan would be removed, and the contract did not address this issue. Which statement is TRUE? a. Ceiling fans are usually considered real estate. b. The ceiling fan belongs to the seller. c. Ceiling fans are considered trade fixtures. d. Ceiling fans are considered personal property.

a. Ceiling fans are usually considered real estate.

Broker Smith knows that the real estate taxes on a property are $5,200. He knows that if he states that amount, the buyers will not buy the property; so he states that the taxes are $2,500. This would be a violation of what Massachusetts general law? a. Chapter 93A b. Chapter 21E c. Tristam's Landing d. Taft-Hartly Law

a. Chapter 93A

Which of the following is NOT an example of governmental power? a. Remainder b. Police power c. Eminent domain d. Taxation

a. Remainder

A landowner who wants to use property in a manner that is prohibited by a local zoning ordinance but which would benefit the community can apply for which of the following? a. Conditional-use permit b. Prescriptive easement c. Occupancy permit d. Property allowance

a. Conditional-use permit

Capitalization is an appraisal process used to: a. Convert net income into market value b. Establish book value c. Determine net income d. Establish a capitalization rate

a. Convert net income into market value

A restriction in a seller's deed may be enforced by which of the following? a. Court injunction b. Zoning board of appeal c. City building commission d. State legislature

a. Court injunction

You sell a note with a face value of $12,000 for $10,000. You are: a. Discounting the note b. Amortizing the note c. Committing an act requiring a real estate license d. Committing fraud

a. Discounting the note

A landowner has divided a large parcel of land into smaller parcels and has recently sold a tract near a nature preserve that is landlocked and cannot be entered except through one of the other tracts. The buyer of that property will probably be granted what type of easement by court action? a. Easement by necessity b. Easement in gross c. Easement by prescription d. Easement by condemnation

a. Easement by necessity

The one unity in a joint tenancy holding that is also present in a tenancy in common holding is: a. Equal right of possession b. Right of survivorship c. Equal interest of all owners d. Tenant in possession can be charged rent for the use of the land

a. Equal right of possession

The unity in a joint tenancy holding that is also present in tenancy-in-common holding is: a. Equal right of possession b. Right of survivorship c. Equal interest of all owners d. Tenant in possession can be charged rent for the use of the land

a. Equal right of possession

A buyer makes an offer on a seller's house and the seller accepts. Both parties sign the sales contract. At this point, the buyer has what type of title to the property? a. Equitable b. Voidable c. Escrow d. Contract

a. Equitable

The act of signing a deed is the... a. Execution b. Ratification c. Verification D. Notarization

a. Execution

Which of these is a general, statutory, and involuntary lien on both real and personal property? a. Federal tax lien b. Mechanic's lien c. Special assessment d. Consumer loan lien

a. Federal tax lien

The three-day right of rescission does NOT apply in which of the following situations? a. First mortgage b. Home equity loan c. Refinancing of the loan d. None of the above

a. First mortgage

A deed contains a promise that the title conveyed is good and a promise to obtain and deliver any documents necessary to ensure good title. This deed contains an example of which covenant? a. Further assurances b. Seisin c. Quiet enjoyment d. Warranty forever

a. Further assurances

Which agency, upon receiving a complaint regarding a Fair Housing Act violation, investigates? a. HUD b. HOPA c. DOJ d. ADA

a. HUD

Which of the following is TRUE regarding asbestos? a. Improper removal of asbestos can cause further contamination of a building. b. Asbestos causes health problems only when it is eaten. c. The level of asbestos in a building is affected by weather conditions. d. HUD requires that all asbestos-containing materials be removed from all residential buildings.

a. Improper removal of asbestos can cause further contamination of a building.

Which of the following are traditionally covered by a standard title insurance policy? a. Improperly delivered deeds b. Changes in land use because of zoning ordinances c. Unrecorded liens not known to the policyholder d. Unrecorded rights of persons in possession

a. Improperly delivered deeds

Which of the following is a physical characteristic of land? a. Indestructibility b. Improvements c. Area preference d. Scarcity

a. Indestructibility

Which statement is TRUE of a listing agreement? a. It is an employment contract for the professional services of the broker. b. It obligates the seller to transfer the property if the broker procures a ready, willing, and able buyer. c. It obligates the broker to work diligently for both the seller and the buyer. d. It automatically binds the owner, the broker, and the MLS to its agreed provisions.

a. It is an employment contract for the professional services of the broker.

Normally a deed will be considered valid even if: a. It is signed by the attorney-in-fact of the seller b. The grantor is not a legal entity c. The grantor is a minor d. The grantor did not deliver the deed

a. It is signed by the attorney-in-fact of the seller

In one state, a lender holds a lien on real property offered as collateral for a loan. The borrower retains both legal and equitable title to real property. If the borrower defaults on the loan, the lender must go through formal foreclosure proceedings to recover the debt. This state can be BEST characterized as what kind of state? a. Lien theory b. Mortgage theory c. Intermediate theory d. Title theory

a. Lien theory

Which of these would permit a law enforcement officer to seize and sell a debtor's property? a. Lis pendens b. Satisfaction of judgment c. Writ of execution d. Writ of attachment

a. Lis pendens

A three-story apartment complex built in 1965 does not meet with the handicapped access provisions for the 1988 Fair Housing Act. The owner must: a. Make the ground floor handicapped accessible. b. Make the first and second floors accessible. c. Make the entire building accessible. d. The owner doesn't have to comply since it's less than four stories.

a. Make the ground floor handicapped accessible.

The board that administers the rules and regulations for real estate brokers and salespeople is called the... a. Massachusetts Board of Registration of Real Estate Brokers and Salespersons b. Massachusetts Licensing Board of Real Estate Professionals c. Massachusetts Association of REALTORS d. Massachusetts Board of Real Estate Brokers

a. Massachusetts Board of Registration of Real Estate Brokers and Salespersons

What is the key to an accurate appraisal? a. Methodical collection and analysis of data b. Years of experience the appraiser has c. Appraising in a market with high supply d. Appraising in a market with high demand

a. Methodical collection and analysis of data

A subdivider and a developer purchased considerable acreage and now plans to construct a tract of 40 homes. In arranging the financing for the new construction, the lender has agreed to advance part of the funds immediately and will release a set amount of additional money as each home is completed. The funds that will be forthcoming as construction progresses are known as: a. Obligatory advances b. Reconveyance funds c. Release monies d. Open and mortgage payments

a. Obligatory advances

The date and time a document was recorded help establish which of the following? a. Priority b. Abstract of title c. Subrogation d. Marketable title

a. Priority

The owners of a modest ranch house in a neighborhood of larger, more expensive homes may find that the value of their home is affected by what principle? a. Progression b. Increasing returns c. Competition d. Regression

a. Progression

Which statement describes the Supreme Court's decision in the case of Jones v. Alfred H. Mayer Company? a. Racial discrimination is prohibited by any party in the sale or rental of real estate. b. Sales by individual residential homeowners are exempted, provided the owners do not use real estate professionals. c. Laws against discrimination apply only to federally related transactions. d. Persons with disabilities are a protected class.

a. Racial discrimination is prohibited by any party in the sale or rental of real estate.

A real estate professional who has several years of experience in the industry has decided to retire from actively marketing properties. Now this person helps clients choose among the various alternatives involved in purchasing, using, or investing property. What is this person's profession? a. Real estate counselor b. Real estate appraiser c. Real estate educator d. Building inspector

a. Real estate counselor

Which of the following is a specific, involuntary, statutory lien? a. Real estate tax lien b. Income tax lien c. Estate tax lien d. Judgment lien

a. Real estate tax lien

A lien on real estate would be which of the following? a. Recorded mortgage b. Easement c. Encroachment d. Restrictive covenant

a. Recorded mortgage

Which statement BEST explains why instruments affecting real estate are recorded? a. Recording gives constructive notice to the world of the rights and interests claimed in the identified parcel of real estate. b. Failing to record will void the transfer. c. The instruments must be recorded to comply with the terms of the statute of frauds. d. Recording proves the execution of the instrument.

a. Recording gives constructive notice to the world of the rights and interests claimed in the identified parcel of real estate.

A lender of money on real property should be relatively certain that his mortgage is an enforceable lien. He can best accomplish this by: a. Recording the transaction b. A title insurance policy c. Providing for an acceleration clause d. A physical inspection of the property

a. Recording the transaction

If a man has a freehold estate, which of the following would result in his having a less-than-freehold estate: a. Sale and lease-back b. Selling the mineral rights to a third party c. Giving a leasehold interest for 5 years d. Granting a life estate

a. Sale and lease-back

What document is available to the mortgagor when the mortgage debt is completely repaid? a. Satisfaction of mortgage b. Defeasance certificate c. Deed of trust d. Mortgage estoppel

a. Satisfaction of mortgage

Real property can become personal property by: a. Severance b. Purchase c. Hypothecation d. Attachment

a. Severance

Which of the following describes the act by which real property can be converted into personal property? a. Severance b. Accession c. Conversion d. Attachment

a. Severance

Which of the following is NOT a test to identify a fixture? a. Size of the item b. Intent of the parties c. Method of attachment of the item d. Adaptation of the item to the real estate

a. Size of the item

The relationship between real estate broker and seller is generally what type of agency? a. Special b. General c. Implied d. Universal

a. Special

Schools would be considered part of which real estate classification? a. Special purpose b. Industrial c. Commercial d. Residential

a. Special purpose

Party Y receives a deed from party X. The granting clause of the deed states, "I hereby remise, release, alienate, and convey to Y the following real property." What type of deed has Y received? a. Special warranty b. Quitclaim c. General warranty d. Bargain and sale

a. Special warranty

Which of the following is NOT an adequate description of land in a deed? a. Street address b. Metes-and-bounds description c. Reference description d. Street address and metes-and-bounds description

a. Street address

Terry is the personal assistant of a real estate sales associate. Terry must be paid by the broker who employs the sales associate. This means that... a. Terry has a real estate license. b. the sales associate doesn't make very much money. c. Terry is a part-time employee. d. ultimate responsibility for Terry's conduct in the performance of work-related activities lies with the sales associate.

a. Terry has a real estate license.

A person agrees to sell a property for $500,000. The buyer gives the seller $150 as valuable consideration for a six-month option. Which of the following statements is true? a. The $150 is valuable consideration if the seller accepted it. b. The buyer must have at least 5% down as valuable consideration. c. The buyer must have at least 20% down. d. The seller cannot accept money for the option.

a. The $150 is valuable consideration if the seller accepted it.

Two sales associates who work for the same firm agree to divide their town into a northern region and a southern region; one sales associate will handle listings in the north, and the other will handle listings in the south. Which statement is TRUE? a. The agreement does not violate antitrust laws b. The agreement constitutes illegal price-fixing c. The two sales associates have violated the Sherman Antitrust Act and are liable for treble damages d. The two sales associates are guilty of a group boycott with regard to other sales associates in their firm

a. The agreement does not violate antitrust laws

Effective gross income would be... a. annual gross rents less an amount for vacancy and collection costs. b. gross income less the debt service c. gross income less the operating expenses d. the building's cash flow

a. annual gross rents less an amount for vacancy and collection costs.

Which statement is TRUE of a real estate broker acting as the agent of the seller? a. The broker is obligated to render loyalty to the seller. b. The broker can disclose confidential information about the seller to a buyer if it increases the likelihood of a sale. c. The broker can agree to a change in price without the seller's approval. d. The broker can accept a commission from the buyer without the seller's approval.

a. The broker is obligated to render loyalty to the seller.

A buyer bought a house, received a deed, and moved into the residence but neglected to record the document. One week later, the seller died and the heirs in another city, unaware that the property had been sold, conveyed title to a relative, who recorded the deed. Who owns the property? a. The buyer b. The relative c. The seller's heirs d. Both the buyer and the relative

a. The buyer

While suffering from a mental illness that caused delusions, hallucinations, and loss of memory, a person signed a contract to purchase real estate. Which statement regarding the contract to purchase is TRUE? a. The contract is voidable. b. The contract is void. c. The contract lacks consent. d. The contract is fully valid and enforceable.

a. The contract is voidable.

In determining whether an item is real or personal property, a court would NOT consider which of the following? a. The cost of the item when it was purchased b. Whether its removal would cause severe damage to the real estate c. Whether the item is clearly adapted to the real estate d. Any relevant agreement of the parties in their contract of sale

a. The cost of the item when it was purchased

For a property to be held in tenancy by the entirety, which of the following is required? a. The cotenants must be husband and wife b. The property in question must be Torrens property c. Upon the death of a cotenant, the decedent's interest must pass to his or her heirs d. In the event of a dispute, the property must be partitioned

a. The cotenants must be husband and wife

The phrase "bundle of legal rights" is properly included in: a. The definition of real property b. A legal description c. Real estate transactions d. Leases for less than one year

a. The definition of real property

If the loan-to-value ratio is low: a. The equity in property is high b. The equity is not affected c. The equity in the property is low d. None of the above

a. The equity in property is high

Three people are joint tenants with rights of survivorship in a tract of land. One owner conveys his interest to a friend. Which statement is TRUE? a. The other two owners remain joint tenants. b. The new owner has severalty ownership. c. They all become tenants in common. d. They all become joint tenants.

a. The other two owners remain joint tenants.

An alienation clause provides that: a. The principal amount of the loan, plus accrued interest, is due in the event of the sale of the property b. The mortgage is security for a promissory note c. A lien can be placed on the property that takes precedence over a prior recorded trust deed d. None of the above

a. The principal amount of the loan, plus accrued interest, is due in the event of the sale of the property

A rancher owns a parcel of land on which oil is discovered. If the rancher has not previously conveyed the oil rights, who owns the oil? a. The rancher b. The tenant to whom the property has been leased c. The state government d. The federal government

a. The rancher

A resort purchases a large tract of scenic forest land and puts several prefabricated steel buildings there to store landscaping equipment, fuel oil, and propane canisters. Which statement is TRUE regarding this situation? a. The resort's action constitutes improvement of the property. b. The chemicals are considered appurtenances. c. The buildings are considered trade fixtures. d. Storing fuel oil, which is highly flammable, is not included in the bundle of legal rights.

a. The resort's action constitutes improvement of the property.

A married couples lives in a rural area and have a septic system. They take advantage of the low interest rates and refinance their mortgage. Which of the following statements is TRUE? a. They don't need a septic system inspection. b. They need a septic system inspection within two years of the refinancing. c. They need a septic system inspection within 30 days of the refinancing. d. They need a septic system inspection at any time in the future.

a. They don't need a septic system inspection.

The Fair Housing Act of 1968 is known as... a. Title VIII of the Civil Rights Act of 1968 b. the Civil Rights Act of 1866 c. the Civil Rights Act of 1964 d. Executive Order No. 11063

a. Title VIII of the Civil Rights Act of 1968

Which item would a lender generally require at the closing? a. Title insurance commitment b. Market value appraisal c. Application d. Credit report

a. Title insurance commitment

What is the name of the decision of the Massachusetts Supreme Court which states that "if a buyer defaults, a contract is not consummated"? a. Tristam's Landing b. Habeus Corpus c. Sherman Anti-Trust Law d. Landfall Act

a. Tristam's Landing

Which of the following is a similarity between an open listing and an exclusive agency listing? a. Under each, the seller avoids paying the broker a commission if the seller sells the property to someone the broker did not procure. b. Each grants a commission to any broker who procures a buyer for the seller's property. c. Under each, the broker earns a commission regardless of who sells the property, as long as it is sold within the listing period. d. Each grants the exclusive right to sell to whatever broker produces a buyer for the seller's property.

a. Under each, the seller avoids paying the broker a commission if the seller sells the property to someone the broker did not procure.

Some contracts may require performance by one party and are known as... a. Unilateral b. Vicelateral c. Bilateral d. Monolateral

a. Unilateral

A deed contains a guarantee that the grantor will compensate the grantee for any loss resulting from the title's failure in the future. This is an example of which covenant? a. Warranty forever b. Further assurance c. Quiet enjoyment d. Seisin

a. Warranty forever

Of the following factors, which is the one that would not contribute to obsolescence? a. Wear and tear from use b. Out-of-date equipment c. Change of locational demand d. Misplacement of improvement

a. Wear and tear from use

A real estate professional who represents the seller is showing a house to a prospective buyer-customer. The real estate professional knows that the house has water problems in the basement. Which of the following is TRUE? a. Withholding the information prevents the buyer from making an informed decision. b. Withholding the information properly protects the confidence of the seller. c. Disclosing the information could create a fiduciary relationship with the buyer. d. Disclosing the information violates the real estate professional's fiduciary duty to the seller.

a. Withholding the information prevents the buyer from making an informed decision.

When a real estate company has agency agreements with both a seller and a buyer, can the buyer make an offer on the seller's property? a. Yes, if both parties have completed written agency agreements. b. Yes, if the seller has agreed to pay the commission. c. No, because the real estate company would then be a dual agent. d. Yes, if both the buyer and the seller give their consent to dual agency.

a. Yes, if both parties have completed written agency agreements.

A homeowner owned a house on a lot. The front ten feet of the lot were taken by eminent domain for a sidewalk. Would the homeowner be entitled to compensation? a. Yes. The land was taken for public use by eminent domain. b. Yes. He must be paid for the use of the sidewalk. c. No. He still had use of the house and lot. d. No. Compensation is not given on land taken for public use.

a. Yes. The land was taken for public use by eminent domain.

The security deposit must be kept in... a. a Massachusetts bank account b. the landlord's possession c. the landlord's bank account d. a trust fund established for the tenant

a. a Massachusetts bank account

The federal anti-discriminatory laws apply to which of the following? a. a broker selling a single-family home b. a private club not open to the general public c. office building sales d. the rental of industrial property

a. a broker selling a single-family home

The sales contract says the buyer will purchase only if an attorney approves the sale by the following Saturday. The attorney's approval is... a. a contingency b. a reservation c. a warranty d. a consideration

a. a contingency

The smallest right that a person can have in real estate is... a. a license b. a life estate c. a lease d. an easement

a. a license

The buyers purchased a model home and all its furnishings and appliances by using... a. a package loan b. a blanket loan c. a FHA-insured loan d. a buydown.

a. a package loan

A form authorizing one person to execute documents for another is called... a. a power of attorney b. a release deed c. a quitclaim deed d. a power to represent.

a. a power of attorney

A subdivision declaration reads, "No property within this subdivision may be further subdivided for sale or otherwise, and no property may be used for other than single-family housing." This is an example of... a. a restrictive covenant b. an illegal reverter clause c. R-1 zoning d. a conditional-use clause

a. a restrictive covenant

Dan bought his land with an agreement that he could not stable a horse on the property. This would be... a. a restrictive covenant b. discriminatory c. unfair d. a dominant estate

a. a restrictive covenant

A property owner owns a large tract of land. After an adequate study of all the relevant facts, the owner legally divides the land into 30 lots suitable for the construction of residences. In this situation, the property owner is acting as... a. a subdivider b. a developer c. a land planner d. an urban planner

a. a subdivider

A legal arrangement under which the title to real property is held to protect the interests of a beneficiary is... a. a trust b. a corporation c. a limited partnership d. a general partnership

a. a trust

The type of easement that is a right-of-way for a utility company's power lines is... a. an easement in gross b. an easement by necessity c. an easement by prescription d. a nonassignable easement.

a. an easement in gross

A tenant's right to possess real estate for a definite period with a specific starting and ending date is... a. an estate for years b. an estate at will c. an estate at sufferance d. an estate from period to period

a. an estate for years

Which of the following is a variance? a. an exception to a zoning ordinance b. a court order prohibiting certain activities c. a reversion of ownership d. a nullification of an easement

a. an exception to a zoning ordinance

Riparian rights are... a. an owner's rights in land bordering a river or stream. b. the right of an owner to sue a tenant. c. the government's ability to take over land. d. the rights of purchasers to sue for specific performance.

a. an owner's rights in land bordering a river or stream.

One who has ownership rights of real estate that could continue forever and which provide that no other person can claim to be the owner of or have any ownership control over the property has... a. fee simple absolute b. life estate c. determinable fee d. condition subsequent.

a. fee simple absolute

The three-day right of rescission does NOT apply in which of the following situations? a. first mortgage b. home equity loan c. refinancing of the loan d. none of the above

a. first mortgage

A property manager is hired to manage a property while the owner is overseas for two years. The property manager is a(n)... a. general agent b. special agent c. universal agent d. attorney-in-fact

a. general agent

A mortgagor is the one who... a. gives a mortgage b. holds a mortgage c. provides mortgage funds d. forecloses on a mortgage

a. gives a mortgage

In a preprinted sales contract, several words were crossed out or inserted by the parties. To eliminate future controversy as to whether the changes were made before or after the contract was signed, the usual procedure is to... a. have both parties initial or sign in the margin near each change. b. write a letter to each party listing the changes. c. have each party write a letter to the other approving the changes. d. redraw the entire contract.

a. have both parties initial or sign in the margin near each change.

An example of personal property is... a. household furniture b. wall to wall carpeting c. built in dishwasher d. garbage disposal

a. household furniture

The provisions of the federal Fair Housing Act apply... a. in all states b. in those states that have ratified the act, but not in other states c. only in those states that do not have substantially equivalent laws d. only in those states that do not have specific state fair housing laws

a. in all states

For a real estate sale contract to be enforceable in a court of law, the contract must be... a. in writing b. signed by the buyer c. signed by the seller d. on a preprinted standard form

a. in writing

An appraiser has been hired to prepare an appraisal on a property that includes an elegant old mansion that is now used as an insurance company office. Which approach to value would the appraiser rely on MOST? a. income approach b. gross rent multiplier approach c. sales comparison approach d. replacement cost approach

a. income approach

A listing agreement... a. is an employment contract between a broker and a seller. b. is an agreement to purchase property signed by the buyer. c. must not specify a price for the property. d. may not state a specific commission.

a. is an employment contract between a broker and a seller.

In the event a sole proprietor of a real estate brokerage firm dies, a temporary license is issued. The license... a. is good for one year and is not renewable. b. may be renewed if necessary. c. becomes a permanent license after one year. d. is given automatically.

a. is good for one year and is not renewable.

An agent who has been hired by a seller and allows another agent to be a subagent... a. is liable for the other agent's statements b. is not liable for the other agent's statements c. is a facilitator in the transaction d. would be a buyer's agent in the transaction

a. is liable for the other agent's statements

All of the following are true about underground water contamination EXCEPT... a. it is a minor problem in the United States. b. any contamination of underground water can threaten the supply of pure, clean water from private wells and public water systems. c. protective state and federal laws concerning water supply have been enacted. d. real estate professionals need to be aware of potential contamination sources.

a. it is a minor problem in the United States.

One of the disadvantages of buying an investment property is... a. lack of liquidity b. appreciation c. revocation d. blockbusting

a. lack of liquidity

A recorded notice of a current lawsuit involving title to real property is termed a(n)... a. lis pendens b. writ of execution c. attachment d. order to show case

a. lis pendens

In real estate agency relationships, the agreement between a seller and his agent is known as a... a. listing agreement b. a sales agreement c. a binder d. a purchase offer

a. listing agreement

To ensure that a property is free from municipal liens, the attorney for the purchase will obtain a municipal lien certificate... a. local tax collector b. Registry of Deeds c. state tax office d. Local courthouse

a. local tax collector

When estimating the value of property using the cost approach, all of the following are considered by an appraiser EXCEPT: a. loss of value due to uncontrolled delinquent rent b. estimated loss attributable to an outdated heating system c. quality of materials and workmanship in the original structure d. excessive amount of traffic noise outside the property

a. loss of value due to uncontrolled delinquent rent

All of the following may contribute to the growth of mold EXCEPT... a. low humidity b. presence of EIFS c. roof leaks d. improperly installed gutters

a. low humidity

Asbestos dust can cause... a. lung disease b. radiation sickness c. skin cancer d. AIDS

a. lung disease

A seller listed a property with a broker under an exclusive agency listing agreement. If the seller finds a buyer, the seller will owe the broker... a. no commission. b. the full commission. c. a partial commission. d. only reimbursement for the broker's costs.

a. no commission.

A gas station owner owns a station in an area that had no zoning, but now has been zoned as residential. The gas station owner can continue to operate his business because of... a. nonconforming use b. variance c. cluster zoning d. urban development

a. nonconforming use

A town located near a small recreational lake enacts a new zoning code. Under the new code, commercial buildings are not permitted within 1,000 feet of the lake. A commercial building that is permitted to continue in its former use even though it is built on the lakeshore is an example of... a. nonconforming use b. variance c. special use d. adverse possession

a. nonconforming use

A homestead exemption protects against judgments... a. of unsecured creditors. b. resulting from unpaid taxes. c. from foreclosure of a mortgage. d. that result from the costs of improvements.

a. of unsecured creditors.

Which of the following terms in an ad would violate the Civil Rights Act of 1968? a. one child ok b. bachelor apartment c. master bedroom d. a non-freehold lease

a. one child ok

A listing contract in which payment of the commission is contingent on the broker being able to produce a buyer before the property is sold by the owner or another broker is called a(n)... a. open listing b. net listing c. exclusive-right-to-sell listing d. exclusive-agency listing

a. open listing

In an FHA mortgage, if the appraised value is less than the selling price, the borrower must... a. pay the difference in cash b. cancel the loan c. apply for another loan d. obtain a second loan

a. pay the difference in cash

Before a property owner can have a septic tank installed, he or she must have the soil tested to determine how much wastewater the soil can absorb by ordering a(n)... a. percolation test b. pest inspection c. field investigation d. home inspection

a. percolation test

Documents referred to as title evidence include... a. policies of title insurance. b. general warranty deeds. c. security agreements. d. special warranty deeds.

a. policies of title insurance.

At a meeting, a group of brokers agrees that they will not charge less than a 5% commission on their listings. This would be an example of... a. price fixing b. adverse negotiation c. a commission split d. a bilateral contract

a. price fixing

Owners whose property is adjacent to a large pond own the... a. property to the shore, with their use of the water limited by environmental laws. b. property to the center of the pond, but they may use the water only for recreation. c. property up to 100 rods from the shoreline. d. entire pond if they agree to comply with the appropriate environmental regulations.

a. property to the shore, with their use of the water limited by environmental laws.

To protect the public from fraudulent interstate land sales, a developer involved in interstate land sales of 25 or more lots must... a. provide each purchaser with a printed report disclosing details of the property. b. pay the prospective buyer's expenses to see the property involved. c. provide preferential financing. d. allow a 30-day cancellation period

a. provide each purchaser with a printed report disclosing details of the property.

The Civil Rights Act of 1866 prohibits any limitation of property rights based on... a. race b. religion c. sex d. handicap

a. race

The Civil Rights Act of 1866 prohibits discrimination in housing based on which of the following reasons? a. race b. religion c. sex d. marital status

a. race

If a tenant moves into an apartment and replaces an old light with a new ceiling fan, the ceiling fan would be considered... a. real property b. personal property c. a trade fixture d. littoral property

a. real property

All of the following items are usually prorated between the buyer and seller at closing EXCEPT... a. recording charges b. real estate taxes c. rents d. utility bills

a. recording charges

After real estate has been sold by the state or county to satisfy a delinquent tax lien, defaulted owners usually have a right to... a. redeem the property within the time specified by law b. have the sale canceled by paying the back taxes and penalties c. pay their creditors directly and have their liens removed d. record a notice of non-responsibility for the unpaid taxes

a. redeem the property within the time specified by law

A lender's refusal to lend money to potential homeowners attempting to purchase properties located in particular ethnic neighborhoods is known as... a. redlining b. blockbusting c. steering d. prequalifying

a. redlining

The person who prepares an abstract of title for a parcel of real estate... a. searches the public records and then summarizes the events and proceedings that affect title. b. insures the condition of the title. c. inspects the property. d. issues title insurance.

a. searches the public records and then summarizes the events and proceedings that affect title.

The basic requirements for a valid conveyance are governed by... a. state law. b. local custom. c. national law. d. the law of descent.

a. state law.

The illegal practice of directing minorities to areas populated by the same race or religion is called: a. steering b. blockbusting c. redlining d. panic peddling

a. steering

In MOST market areas, rents are determined by... a. supply and demand factors b. the local apartment owners' association c. HUD d. a tenants' union

a. supply and demand factors

A trust that is established after the death of the owner is called a... a. testamentary trust b. trust by will c. beneficial trust d. living trust

a. testamentary trust

The conservatorship of Fannie Mae and Freddie Mac is the responsibility of... a. the Federal Housing Finance Agency b. the Federal Housing Authority c. the Office of the Comptroller of the Currency d. the Federal Reserve System

a. the Federal Housing Finance Agency

A property listing taken by a real estate sales associate is technically an employment agreement between the seller and... a. the broker b. the local multiple listing service c. the sales associate d. the sales associate and broker together

a. the broker

A seller has listed a home with a broker for $190,000. The listing broker tells a prospective buyer to submit a low offer because the seller is desperate to sell. The buyer offers $185,000 and the seller accepts it. In this situation, ... a. the broker has violated the agency relationship with the seller. b. the broker was unethical, but the seller did get to sell the property. c. the broker acted properly to obtain a quick offer on the property. d. any broker is authorized to encourage such bids for the property.

a. the broker has violated the agency relationship with the seller.

The manager of a commercial building has many responsibilities in connection with the operation and maintenance of the structure. The manager would normally be considered the agent of... a. the building's owner b. the building's tenants c. both the owner and the tenants d. neither the owner nor the tenants

a. the building's owner

The manager of a commercial building has many responsibilities in connection with the operation and maintenance of the structure. The manager would normally be considered the agent of... a. the building's owner. b. the building's tenants. c. both the owner and the tenants. d. neither the owner nor the tenant.

a. the building's owner.

Security deposits should be listed on a closing statement as a credit to... a. the buyer b. the seller c. the lender d. the real estate professional

a. the buyer

What would have the greatest effect on a person's interest rate? a. the discount rate b. the person's credit score c. Regulation Z d. private mortgage insurance

a. the discount rate

It is illegal for a lending institution to refuse to make a residential real estate loan in a particular area based on... a. the ethnicity of the residents of the area b. the applicant's questionable economic situation c. the applicant not being of legal age d. the deteriorated condition of the premises

a. the ethnicity of the residents of the area

In order for a deed to be valid... a. the grantor must be legally competent b. the signature of the grantor must be witnessed and notarized c. the deed must be recorded d. the grantee must sign the deed

a. the grantor must be legally competent

Every deed must be signed by... a. the grantor. b. the grantee. c. the grantor and grantee. d. the devisee.

a. the grantor.

A prospective buyer needs to borrow money to buy a house. The buyer applies for and obtains a real estate loan from a mortgage company. Then the buyer signs a note and a mortgage. In this example, the buyer is called... a. the mortgagor b. the beneficiary c. the mortgagee d. the vendor

a. the mortgagor

A plat for a proposed subdivision is submitted to... a. the municipality b. the property owners c. the developer d. the state

a. the municipality

The market price of a parcel of real estate is... a. the price it sold for b. the price it should have sold for c. the price that was being asked for it d. based on its assessed value

a. the price it sold for

A subagency relationship cannot be created without... a. the principal's consent b. a written contract c. the buyer's permission d. approval of the agent's broker

a. the principal's consent

The effort that brings about the producing of a buyer for a listed property is... a. the procuring cause b. a market analysis c. hypothecation d. cooperation

a. the procuring cause

Chain of title is MOST accurately defined as... a. the record of a property's ownership. b. a report of the contents of the public record, including all legal proceedings, regarding a particular property. c. an instrument or document that protects the insured parties (subject to specific exceptions) against defects in the record of a property's ownership. d. the examination of the record and hidden risks such as forgeries, undisclosed heirs, errors in the public records, and so on.

a. the record of a property's ownership.

A suit to quiet title refers to... a. the removal of a cloud on the title by court action. b. a title insurance company's search of the title. c. a mortgagor relinquishing title after foreclosure. d. the deposit of a title with an escrow agent.

a. the removal of a cloud on the title by court action.

If property is held by two or more owners as joint tenants, the interest of a deceased co-owner will be passed to... a. the surviving owner or owners. b. the heirs of the deceased. c. the state, under the law of escheat. d. the trust under which the property was owned.

a. the surviving owner or owners.

The borrower under a deed of trust is known as... a. the trustor b. the trustee c. the beneficiary d. the vendee.

a. the trustor

When is the Closing Disclosure given to the borrower? a. three days prior to the closing b. at or before the closing c. when the deed is recorded d. only when the borrower requests

a. three days prior to the closing

Under the Torrens system a. title passes when the grantee's application for registration has been approved and the real estate has been registered. b. the Torrens official performs exactly the same functions as the recorder of deeds. c. the original deed is mailed to the buyer after it has been registered. d. the registration of a title can be canceled by the owner at any time.

a. title passes when the grantee's application for registration has been approved and the real estate has been registered.

Under an installment contract, the title to the property is held by the... a. vendor b. vendee c. trustor d. trustee

a. vendor

After the lease terminates, the tenant is entitled to the return of her security deposit... a. within 30 days, including interest. b. within three weeks, including interest. c. unless the property has been transferred to a new owner. d. with no deductions withheld.

a. within 30 days, including interest.

A suit may be filed in federal court by a person aggrieved by an alleged act of discrimination under the Fair Housing Act... a. within two years of the discriminatory act. b. no later than one year after the discriminatory act. c. with the approval of the state or county nondiscrimination officer. d. if the Federal Housing Administration refuses to pursue the case.

a. within two years of the discriminatory act.

A parcel of land is 400 feet by 640 feet. The parcel is cut in half diagonally by a stream. How many acres are in each half of the parcel? a. 2.75 b. 2.94 c. 5.51 d. 5.88

b. 2.94

A property sells for $85,000 and the total commission is 5%. The broker pays a 20% referral fee to the listing agent and a 40% fee to the selling agent. How much does the broker net from the sale? a. $4,250 b. $1,700 c. $850 d. $6,000

b. $1,700

The selling price of a property is $96,000. This can be financed if the buyer can put 10% down and pay a loan origination fee of 1.5%. How much cash must the buyer produce to complete this transaction? a. $10,080 b. $10,896 c. $11,040 d. $11,084

b. $10,896

A house sells for $215,000. The listing brokerage receives a 6% commission on the sale. How much does the listing brokerage receive? a. $21,500 b. $12,900 c. $6,450 d. $12,300

b. $12,900

If the potential gross rental income from a property is $20,000, the vacancy rate is 5%, and the additional income from the laundry facilities and extra storage is $700, what is the effective gross income? a. $19,000 b. $19,700 c. $20,000 d. $20,700

b. $19,700 ($20,000 + $700) - $20,000(0.05) = $19,700

The effective gross income from an office building property is $73,500 and the annual operating expenses total $52,300. If the owner expects to receive an 11% return on the investment, what is the value of the property? a. $125,800 b. $192,727 c. $475,454 d. $668,181

b. $192,727 - $73,500 gross income - $52,300 annual operating expenses = $21,200 net income - $21,200 net income divided by 11% return on investment = $192,727

If a residence is valued at $87,500 and its assessment ratio is 50% of market value, what are the annual taxes if the tax rate of $7.80 per $100 of assessed valuation? a. $3,187.75 b. $3,412.50 c. $5,608.96 d. $6,825.00

b. $3,412.50 annual taxes - $87,500 residence value x 50% = $43,750 assessed value - $43,750 assessed value divided by $100 = 437.5 - 437.5 x $7.80 = $3,412.50 annual taxes

A charge of three discount points on a $120,000 loan equals... a. $450 b. $3,600 c. $4,500 d. $116,400.

b. $3,600

A buyer purchases 4.5 acres of land for $78,400. An adjoining owner wants to purchase a strip of this land measuring 150 feet by 100 feet. What should this strip cost the adjoining owner if it is sold for the same price per square foot originally paid? a. $3,000 b. $6,000 c. $7,800 d. $9,400

b. $6,000

A buyer has deposited 10% of the sales price with the broker as earnest money, and the bank has agreed to lend $51,000, which is 80% of the sales price. How much additional funding must the buyer provide to complete this transaction? a. $5,100 b. $5,500 c. $6,125 d. $6,375

b. $6,375 - $51,000 loan balance divided by 80% = $63,750 sales price - $63,750 sales price x 20% (100% sales price - 80% loan = 20% down payment) = $12,750 down payment - $63,750 sales price x 10% deposit - $6,375 earnest money - $12,750 down payment - $6385 earnest money = $6,375 needed

On the sale of any property, a sales associate's compensation is based on the total commission paid to the broker. The sales associate receives 30% of the first $2,500, 40% of the next amount between $2,500 and $7,500, and 50% of any remaining amount exceeding $7,500. If a property sells for $234,500 and the broker's commission rate is 6.5%, what is the sales associate's total compensation? a. $5,847.00 b. $6,621.25 c. $6,871.25 d. $7,621.25

b. $6,621.25

A house was listed for sale at $84,900. The seller received $71,424 after paying the broker a 7 percent commission. What was the selling price of the property? a. $76,423.68 b. $76,800.00 c. $78,957.00 d. $79,345.79

b. $76,800.00 sales price = $71,424 net divided by 93% (100%-7% commission)

A 40-acre tract was sold for $2,200 per acre. The seller realized a 14.5% profit from the sale. What was the original cost of the tract? a. $75,240 b. $76,856 c. $100,760 d. $102,924

b. $76,856 original cost - 40 acres x $2,200 per acre = $88,000 sales price - $88,000 sales price divided by 114.5% (100% sales price + 14.5% profit) profit = $76,856 original cost

Assume that the listing and selling brokers split the commission evenly. What is the sales price of the property if the listing broker received $2,593.50 and the total commission rate is 6.5%? a. $88,400 b. $79,800 c. $76,200 d. $39,900

b. $79,800

A person buys a property for $500,000 with a 10% down payment and pays 2 points for a better rate. The amount of the points would be... a. $10,000 b. $9,000 c. $5,000 d. $4,500

b. $9,000

A building sold for $157,000. The broker charged a 6 percent commission and divided it as follows: 10% to the salesperson who took the listing, one-half of the balance to the salesperson who made the sale, and the remainder to the broker. What was the listing salesperson's commission? a. $239 b. $942 c. $1,570 d. $4,239

b. $942

A $75,000 mortgage loan requires a discount of $1,875 to be paid by the seller. How many points is this equivalent to? a. 2.0 b. 2.5 c. 4.5 d. 5.0

b. 2.5 points - $1,875 discount divided by $75,000 mortgage loan

A building is valued at $215,000 and contains four apartments that rent for $470 each per month. The owner estimates that the net operating income is 65% of the gross rental receipts. What is the capitalization rate? a. 3.7 percent b. 6.8 percent c. 10.5 percent d. 14.2 percent

b. 6.8 percent

License suspensions for a real estate agent found to have violated the anti-discrimination laws are how many days for a fist and second violation within two years? a. 30 and 60 b. 60 and 90 c. 60 and 120 d. 90 and 120

b. 60 and 90

A property contains 10 acres. How many lots of not less than 50 feet by 100 feet can be subdivided from the property if 26,000 square feet were dedicated for roads? a. 80 b. 81 c. 82 d. 83

b. 81

A valid escrow requires which of the following: a. Escrow instructions with no conditions b. A binding contract between the buyer & seller & conditional delivery of transfer instruments to a third party c. The services of a licensed real estate broker d. None of the above

b. A binding contract between the buyer & seller & conditional delivery of transfer instruments to a third party

Regarding the federal Lead-Based Paint Hazard Reduction Act, which statement is TRUE? a. All residential housing built before 1978 must be tested for the presence of lead-based paint before being listed for sale or rent. b. A disclosure statement must be attached to all sales contracts and leases involving residential properties built before 1978. c. A lead-hazard pamphlet must be distributed to all prospective buyers but not to tenants. d. Purchasers of housing built before 1978 must be given five days to test the property for the presence of lead-based paint.

b. A disclosure statement must be attached to all sales contracts and leases involving residential properties built before 1978.

A person who performs a visual survey of a property structure and writes a report for a buyer is: a. An educator b. A home inspector c. An appraiser d. A property manager

b. A home inspector

Which of the following describes a net lease? a. An agreement in which the tenant pays a fixed rent and the landlord pays all taxes, insurance, and expenses related to the property b. A lease in which the tenant pays rent, plus some—or most—of the operating expenses related to the property c. A lease in which the tenant pays the landlord a percentage of the monthly income derived from the property d. An agreement granting an individual a leasehold interest in fishing rights for a shoreline property

b. A lease in which the tenant pays rent, plus some—or most—of the operating expenses related to the property

A balloon payment would be most likely associated with which type of loan? a. Household loan b. A partially amortized loan c. Variable rate loan d. A Fixed rate loan

b. A partially amortized loan

A professional opinion of a property's market value, based on established methods and using trained judgement, is performed by: a. A real estate attorney b. A real estate appraiser c. A real estate counselor d. A home inspector

b. A real estate appraiser

Which of the following is a lien on real estate? a. An easement b. A recorded mortgage c. An encroachment d. A restrictive covenant

b. A recorded mortgage

What type of law limits the interest rate that is allowed to be charged? a. Trustee law b. A usury law c. The statute of frauds d. Contract law

b. A usury law

By calling in a loan, the lender... a. Requesting a meeting b. Accelerating loan payments c. Giving you a new loan d. Changes interest rate

b. Accelerating loan payments

Rights or privileges which are connected with real property are: a. Improvements b. Appurtenances c. Not conveyed with the real estate d. Restricted to air and water rights

b. Appurtenances

Laird buys Balley farm from Baker, taking title to the property subject to the existing loan. The person primarily responsible for the repayment of the loan would be: a. Laird b. Baker c. Either Laird or Baker d. Neither Laird or Baker

b. Baker

Which type of deed merely implies but does NOT specifically warrant that the grantor holds good title to the property? a. Special warranty b. Bargain and sale c. Quitclaim d. Trust deed

b. Bargain and sale

Which of the following are NOT basic components of a metes-and-bounds description? a. Tangible and intangible monuments b. Base lines, principal meridians, and townships c. Degrees, minutes, and seconds d. Points of beginning

b. Base lines, principal meridians, and townships

A real estate professional said to a homeowner, "I hear they're moving in. There goes the neighborhood! Better put your house on the market before values drop!" This is an example of what illegal practice? a. Steering b. Blockbusting c. Redlining d. Fraudulent advertising

b. Blockbusting

Broker Steve took a listing from a seller using the standard listing form. One week before the listing expired, the broker informed the seller that he had a prospective buyer named Charlie Bennett. After the listing expired, the seller listed with Broker John. John showed the property to Mr. Bennett and obtained an offer that was accepted. Under these circumstances: a. Broker Steve gets a 6% commission b. Broker John gets a 6% commission c. Both brokers get a 6% commission d. Broker Steve gets a 3% commission and broker John gets a 3% commission

b. Broker John gets a 6% commission

The difference between the cost basis of property and its net selling price is: a. Cost recovery b. Capital gain c. Leverage d. Appreciation

b. Capital gain

In an old retail building, which of the following would MOST likely be a source of incurable functional obsolescence? a. Deficient and inadequate lighting b. Closely-spaced internal support columns c. An unattractive store front d. A decrease in the area's population

b. Closely-spaced internal support columns

Which principle of value indicates that a developer's very profitable real estate project will attract others to engage in similar activity in the same area and thus drive down profits? a. Anticipation b. Competition c. Value d. Progression

b. Competition

St. Michael's hospital receives a gift of real property from an elderly couple who reserves a right to themselves a life estate. The hospital is... a. Grantor b. Remainderman c. Reversionary party d. Donor

b. Remainderman

In Massachusetts, an agent who has an inactive license MUST do which of the following to activate the license? a. Retake the licensing test b. Complete 12 hours of continuing education c. Complete 20 hours of continuing education d. Complete 30 hours of continuing education

b. Complete 12 hours of continuing education

A man owns one of 20 units in fee simple, along with a 5% ownership share in the parking facilities, recreation center, and grounds. What kind of property does he own? a. Cooperative b. Condominium c. Time-share d. Land trust

b. Condominium

Where a broker shows a client's property to a prospective buyer that is listed with the broker under an open listing, the broker should: a. Send a memo to client b. Confirm the showing to the buyer c. Notify the seller as to the prospect's identity d. Notify the local real estate board

b. Confirm the showing to the buyer

A property manager repairs a leaking sink. This is classified as which type of maintenance? a. Preventive b. Corrective c. Routine d. Construction

b. Corrective

In which approach to value are the square-foot method, the unit-in-place method, and the quantity-survey method used? a. Sales comparison approach b. Cost approach c. Income approach d. Reconciliation approach

b. Cost approach

What is NOT included in public land-use controls? a. Subdivision regulations b. Covenants, conditions, and restrictions c. Environmental protection laws d. Comprehensive plan specifications

b. Covenants, conditions, and restrictions

Detailed information about the age, education, behavior, and other characteristics of members of a population is called: a. Population analysis b. Demographics c. Family lifestyles d. Household data

b. Demographics

All of the following are categories of the uses of real property EXCEPT: a. Residential b. Developmental c. Agricultural d. Industrial

b. Developmental

What is the law that prohibits telephone solicitation to any household number illegal unless one has express written permission? a. Rice-Evans Do Not Call Law b. Do Not Call Registry c. ADA Law d. Truth-in-Lending Law

b. Do Not Call Registry

A tenant rents a house at the beach from July 1 to August 31. This is known as a(n)... a. Periodic tenancy b. Estate for years c. Tenancy at sufferance d. Tenancy at will

b. Estate for years

Under which of the following relationships may an owner NOT sell his home without compensating a broker? a. Open listing b. Exclusive-right-to-sell listing c. Exclusive-agency listing d. Multiple listing

b. Exclusive-right-to-sell listing

After a real estate professional takes a sale listing of a residence, the owners specify that they will not sell the home to any Chinese family. The real estate professional should do which of the following? a. Advertise the property exclusively in newspapers marketed to persons of Chinese heritage. b. Explain to the owners that the instruction violates federal law and that the real estate professional cannot comply with it. c. Abide by the owners' directions despite the fact that they conflict with the fair housing laws. d. Require that the owners sign a separate legal document stating the additional instruction as an add-on to the listing agreement.

b. Explain to the owners that the instruction violates federal law and that the real estate professional cannot comply with it.

The grantee receives greatest protection with what type of deed? a. Quitclaim b. General warranty c. Bargain and sale with covenant d. Executor's

b. General warranty

The recording of a deed: a. Is all that is required to transfer the title to real estate. b. Gives constructive notice of the ownership of real property. c. Insures the interest in a parcel of real estate. d. Warrants the title to real property.

b. Gives constructive notice of the ownership of real property.

In one city, developers are limited by the zoning law to constructing no more than an average of three houses per acre in any subdivision. What does this restriction regulate? a. Clustering b. Gross density c. Out-lots d. Covenants

b. Gross density

A major manufacturer of automobiles announces that it will relocate on of its factories, along with 2,000 employees, to a small town. What effect will this announcement MOST likely have on the small town's housing market? a. Houses will likely become less expensive b. Houses will likely become more expensive c. Because the announcement involves an issue of demographics, not of supply and demand, housing prices will stay the same d. The announcement involves an industrial property, residential housing will not be affected

b. Houses will likely become more expensive

Paddy owned two acres of land. He sold one acre to Frank and reserved for himself an appurtenant easement over Frank's land for ingress and egress. Frank's land: a. Is the dominant tenement b. Is the servient tenement c. Can be cleared of the easement when Paddy sells the withheld acre to a third party. d. Is subject to an easement in gross.

b. Is the servient tenement

Which statement is TRUE of both a mortgage lien and a judgment lien? a. It must be entered by the court. b. It involves a debtor-creditor relationship. c. It is a general lien. d. It is an involuntary lien.

b. It involves a debtor-creditor relationship.

What is required for a deed to be recorded? a. It must be signed by the mortgagor. b. It must have the signature of the grantors and acknowledgement of the same. c. It must have the signature of the grantee and acknowledgement of the same. d. A title search must be done.

b. It must have the signature of the grantors and acknowledgement of the same.

Two people are co-owners of a small office building with the right of survivorship. One of the co-owners dies intestate and leaves nothing to be distributed to heirs. Which of the following would explain why the surviving co-owner acquired the deceased's interest? a. Severalty b. Joint tenancy c. Community property d. Condominium

b. Joint tenancy

What is the position of home equity line of credit (HELOC) in relation to the original lien? a. Equal b. Junior c. First in priority d. No relationship

b. Junior

Which charge noted on the Closing Disclosure must be the same or less than the charge noted on the Loan Estimate form? a. Cost of settlement services when the lender selects the provider b. Lender charges for taking and underwriting the loan c. Cost of settlement services when the borrower selects the provider from the list provided by the lender d. Cost of homeowners insurance

b. Lender charges for taking and underwriting the loan

The use of borrowed money to finance an investment is called: a. Appreciation b. Leverage c. Depreciation d. Capital gain

b. Leverage

Lender's use the term "debt-income ratio" to refer to a: a. Part of closing costs b. Loan qualifying tool c. Requirement of the Federal Government d. Formula used in appraising property

b. Loan qualifying tool

An insurance policy package that includes standard commercial property coverage such as fire, hazard, public liability, and casualty is called what kind of policy? a. Coinsurance b. Multiperil c. Universal d. Surety

b. Multiperil

An owner of a 5-unit apartment building that is located within the city limits intends to convert the building into 5 condominium units and offer them for sale to the public. Under these circumstances, the developer: a. Must obtain a public report from the Real Estate Commissioner under the Subdivided Lands Act b. Must file a map with the city under the provisions of the Subdivided Map Act c. Is exempt from the Subdivided Lands Act and Subdivision Map Act d. Must comply with the Subdivided Lands Act and the Subdivision Map Act

b. Must file a map with the city under the provisions of the Subdivided Map Act

Which type of listing is prohibited in some states? a. Exclusive right-to-sell b. Net listing c. Buyer representation d. Open listing

b. Net listing

Which of the following agreements need NOT be in writing? a. Exclusive-agency listing b. Open listing c. Exclusive-right-to-sell listing d. Multiple listing

b. Open listing

A buyer signs a contract under which he is given the right to purchase a property for $130,000 anytime in the next six months. The buyer pays the current owner $500 at the time that contract is signed. Which of the following BEST describes this agreement? a. Contingency b. Option c. Installment d. Sales

b. Option

Priority of liens refers to which of the following? a. Order in which a debtor assumes responsibility for payment of obligations b. Order in which liens will be paid if property is sold to satisfy a debt c. Dates liens are filed for record d. Fact that specific liens have greater priority than general liens

b. Order in which liens will be paid if property is sold to satisfy a debt

Which of the following is NOT a form of co-ownership? a. Tenancy in common b. Ownership in severalty c. Tenancy by the entirety d. Community property

b. Ownership in severalty

There are two vacant adjacent lots in an area zoned for commercial use, each worth approximately $50,000. If their owner sells them as a single lot, however, the combined parcel will be worth $120,000. What principle does this illustrate? a. Substitution b. Plottage c. Regression d. Progression

b. Plottage

Which of the following allows a mortgagee to proceed to a foreclosure sale without going to court first? a. Waiver of redemption right b. Power of sale c. Alienation clause d. Possession rights

b. Power of sale

In general, when the supply of a certain commodity increases: a. Price tends to rise b. Price tends to drop c. Demand for it tends to rise d. Demand for it tends to drop

b. Price tends to drop

When demand for a commodity decreases and supply remains the same: a. Price tends to rise b. Price tends to fall c. Price is not affected The market becomes stagnant

b. Price tends to fall

A trust of at least 100 persons that is chartered to acquire and develop real estate is... a. a real estate trust b. REIT c. a cooperative d. tenants in partnership

b. REIT

Which lien usually would be given highest priority in disbursing funds from a foreclosure sale? a. Mortgage dated last year b. Real estate taxes due c. Mechanic's lien for work started before the mortgage was made d. Judgment rendered the day before foreclosure

b. Real estate taxes due

Redlining refers to... a. Refusal to advertise in designated areas b. Refusal to loan in designated areas c. Refusal to list in designated areas d. Refusal to cooperate with other brokers in designated areas

b. Refusal to loan in designated areas

Which of the following is legal? a. Charging a family with children a higher security deposit than those with no children b. Requiring a person with a disability to establish an escrow account for the costs to restore a property after it has been modified c. Picturing only white people in a brochure as the "happy residents" in a housing development d. Refusing to sell a house to a person who has a history of mental illness

b. Requiring a person with a disability to establish an escrow account for the costs to restore a property after it has been modified

A property manager is offered a choice of three insurance policies with different deductibles. If the property manager selects the policy with the highest deductible, which risk management technique is being used? a. Avoiding risk b. Retaining risk c. Controlling risk d. Transferring risk

b. Retaining risk

A rescission of a contract is a(n)... a. Ratification b. Return to the status quo c. Amendment to the terms of a contract d. The elimination of a cash return in the proration

b. Return to the status quo

The characteristics of value include which of the following? a. Competition b. Scarcity c. Anticipation d. Balance

b. Scarcity

A prospective client calls you and asks you to take a listing on his property. In review his papers you discover he is purchasing the property on a contract of sale that has no acceleration clause, and that has no provision in the contract prohibiting a resale or an assignment. Which of the following is the most nearly correct statement? Your client could: a. Sell his interest in the property, but only if he pays off the contract first b. Sell or assign his rights but not his duties under the original contract unless the contract seller's approval was obtained c. Properly give the purchaser a warranty deed to the property providing the deed recited "subject to the existing contract of sale" d. Properly give the purchaser a grant deed to the property, providing he took back a recorded purchase money second trust deed to cover the payments due on the original contract of sale

b. Sell or assign his rights but not his duties under the original contract unless the contract seller's approval was obtained

Who are the parties to a listing agreement? a. Buyer and seller b. Seller and broker c. Seller and salesperson d. Buyer and salesperson

b. Seller and broker

An option to purchase binds which of the following parties? a. Buyer only b. Seller only c. Neither buyer nor seller d. Both buyer and seller

b. Seller only

Which of the following is NOT a test to identify a fixture? a. Intent of the parties b. Size of the item c. Method of attachment d. Adaption of the item to the real estate

b. Size of the item

A lien on real estate made to secure payment for a specific municipal improvement project is which of the following? a. Mechanic's lien b. Special assessment lien c. Ad valorem d. Utility lien

b. Special assessment lien

Property management, appraisal, financing, and development are all examples of: a. Factors affecting demand b. Specializations within the real estate industry c. Non-real estate professions d. Activities requiring broker management and supervision

b. Specializations within the real estate industry

A second offer received on a property prior to the seller's decision on the first offer should be: a. Evaluate by the broker against the first offer b. Submitted immediately c. Held pending a decision on the first offer d. Turned back to the offeree if it doesn't provide better terms

b. Submitted immediately

Mr. and Mrs. Lynch who had been shopping for a new home found one that they liked very much but because they feel the property was overpriced, they decided not to buy it. Their reason for not buying was probably based upon the principle of: a. Conformity b. Substitution c. Highest and best of use d. Anticipation

b. Substitution

A licensed real estate broker working under a typical exclusive listing incurs several expenses. He is not entitled to be reimbursed for these expenditures, unless: a. The buyer has demanded that these expenses be incurred as a condition of continuing with the transaction b. Such expenditures were authorized by the principal c. It was necessary for him to incur the expenses in order to close the sale d. The broker was representing the best interests of the principal in consummating the sale

b. Such expenditures were authorized by the principal

A parcel of property was purchased by two friends. The deed they received from the seller at closing transferred the property without stipulating a form of ownership. The two friends took title as which of the following? a. Joint tenants b. Tenants in common c. Tenants by the entirety d. Community property owners

b. Tenants in common

A salesman receives a deposit together with a written offer to purchase and delivers them to the employing broker who presents it to the seller. The seller signs and accepts the offer. Without the consent of the salesman and through no fault of his own, the buyer and seller instruct the salesman's employing broker to return the deposit. Which of the following is TRUE? a. The salesman's employing broker may retain one-half of the deposit and must give one-half to the seller b. The broker may sue the seller but must return the deposit c. The broker may retain one-half of the deposit and must retain only one-half to the buyer d. The broker may retain the deposit to compensate him for his efforts

b. The broker may sue the seller but must return the deposit

Which statement BEST explains this sentence: "To recover a commission for brokerage services, a broker must be employed by a client"? a. The broker must work in a real estate office. b. The client must make an express or implied agreement to pay a commission to the broker. c. The broker must express an interest in representing the client. d. The broker must have a sales associate employed in the office.

b. The client must make an express or implied agreement to pay a commission to the broker.

What must happen at the closing of a real estate transaction? a. The buyer and seller must sign the deed. b. The deed must be executed and delivered by the grantor. c. The deed must be recorded. d. The broker must be present.

b. The deed must be executed and delivered by the grantor.

The owner of a piece of vacant land removed and sold all the topsoil, limestone, and gravel. At the owner's death, which is TRUE? a. The property no longer exists b. The heir of the deceased inherits the property as is c. The heir of the deceased owns the gravel, limestone, and topsoil, no matter where it is d. The estate of the deceased must restore the property to its original condition.

b. The heir of the deceased inherits the property as is

Which statement applies to both joint tenancy and tenancy by the entirety? a. There is no right to file a partition suit b. The last survivor becomes a severalty owner c. A deed signed by one owner will convey a fractional interest d. A deed will not convey any interest unless signed by both spouses.

b. The last survivor becomes a severalty owner

Which event will terminate an agency in a broker-seller relationship? a. The broker discovers that the market value of the property is such that an adequate commission will not be earned. b. The owner declares personal bankruptcy. c. The owner abandons the property. d. The broker appoints other brokers to help sell the property.

b. The owner declares personal bankruptcy.

The buyer of an apartment complex is told that the refrigerator in one of the apartments goes with the sale. After taking title, he discovered that the refrigerator belonged to the tenant. Which is true about this situation? a. Since the refrigerator was in the apartment, it automatically belongs to the new owner. b. The refrigerator is the personal property of the tenant. The seller has no right to offer it to the buyer. c. The refrigerator was plugged into the wall and that makes it real property. d. The tenant will have to get permission from the owner to remove the refrigerator.

b. The refrigerator is the personal property of the tenant. The seller has no right to offer it to the buyer.

A married couple made an offer on a house. The offer was accepted by the seller. Thee preprinted sales contract used by the broker contained a standard liquidated damages clause. Two weeks later, the couple decided that they did not want the house. Which of the following statements is TRUE? a. They are bound by the sales contract they made and must proceed with the transaction. b. The seller and the broker may keep the earnest money deposit and put the house back on the market. c. The seller may sue both the husband and the wife for breach of contract. d. Because the broker used a preprinted form contract, the liquidated damages clause is legally void.

b. The seller and the broker may keep the earnest money deposit and put the house back on the market.

A real estate broker lists a home for sale for $189,500. Later that same day, a prospective buyer comes into the broker's office and asks for general information about homes for sale in the $130,000 to $140,000 price range but refuses representation by the broker's company at this time. Based on these facts, which statement is TRUE? a. Both the seller and the potential buyer are the broker's customers. b. The seller is the broker's client; the buyer is a customer. c. The broker owes fiduciary duties to both seller and buyer. d. If the buyer later asks for buyer representation by the broker's firm, it will not be possible because of the firm's earlier agreement with the seller

b. The seller is the broker's client; the buyer is a customer.

A bookstore rents space in a commercial building. The bookstore has large reading tables fastened to the walls and bookshelves bolted to both the ceiling and the floor that create aisles from the front of the store to the back. These were all installed by the bookstore owner. Which of the following BEST characterizes the contents of the bookstore? a. The shelves and tables are trade fixtures and will transfer when the property owner sells the building. b. The shelves and tables are trade fixtures and may properly be removed by the bookstore's owner before the lease expires, with the tenant responsible to the landlord for any damage that the removal causes to the premises. c. Because the business is a tenant, the shelves and tables are fixtures and may not be removed except with the building owner's permission. d. Because the shelves and tables are attached to the building, they are treated the same as other fixtures.

b. The shelves and tables are trade fixtures and may properly be removed by the bookstore's owner before the lease expires, with the tenant responsible to the landlord for any damage that the removal causes to the premises.

A minority purchaser enters your office and states they are looking for, and interested in purchasing. a particular property in a minority neighborhood. You could legally assume that: a. This person is testing you b. They are interested in that particular property c. They are interested in owning a home in an all minority neighborhood They cannot qualify to own property in a higher priced area

b. They are interested in that particular property

Laird and Baker are joint tenants. Baker sells his interest to Charlie. What is the relationship of Laird and Charlie? a. They are joint tenants b. They are tenants in common c. There is no relationship because Baker cannot sell to Charlie d. Lard owns a 2/3 interest and Charlie owns a 1/3 interest

b. They are tenants in common

Ken and Barbie owned a combination apartment building-restaurant. They shared their profits and losses on the venture equally, but they did not have any written partnership agreement. One day, Barbie died of a heart attack. If, after her death, Ken continued to only own the same undivided interest in the real estate as he did before, then... a. They were joint tenants b. They were tenants in common c. They were stockholders in their own corporation d. Barbie died intestate

b. They were tenants in common

Under the TILA-RESPA Integrated Disclosure Rule (TRID), a lender must extend the closing how many days if the annual percentage rate (APR) has changed more than 0.125% before closing? a. Two business days b. Three business days c. Four business days d. Five business days

b. Three business days

The purpose of which of the following laws is to inform mortgage applicants of the cost of obtaining the loan? a. Sherman Anti-Trust Law b. Truth-in-Lending Law c. Evans-Rice Law d. Taft-Hartly Law

b. Truth-in-Lending Law

A person approaches an owner and says, "I'd like to buy your house." The owner says, "Sure," and they agree on a price. What kind of contract is this? a. Implied b. Unenforceable c. Void d. No contract

b. Unenforceable

At closing, the earnest money left on deposit with a real estate broker is... a. a credit to the seller b. a credit to the buyer c. a balancing factor d. a debit to the buyer

b. a credit to the buyer

At closing, the principal amount of a purchaser's new mortgage loan is... a. a credit to the seller b. a credit to the buyer c. a debit to the seller d. a debit to the buyer

b. a credit to the buyer

All of the following clauses in a loan agreement enable the lender to demand the entire remaining debt be paid immediately EXCEPT... a. a due-on-sale clause b. a defeasance clause c. an acceleration clause d. an alienation clause

b. a defeasance clause

All the following clauses in a loan agreement enable the lender to demand that the entire remaining debt be paid immediately EXCEPT... a. a due-on-sale clause b. a defeasance clause c. an acceleration clause d. an alienation clause

b. a defeasance clause

Most states require that a real estate listing agreement contain... a. a multiple listing service (MLS) clause. b. a definite contract termination date. c. an automatic extension clause. d. a broker protection clause.

b. a definite contract termination date.

A property manager who enters into a management agreement with an owner is usually... a. a special agent b. a general agent c. a universal agent d. a designated agent

b. a general agent

A homebuyer has a mortgage that provides for increasing payments over the life of the loan so that it can be paid off earlier than would be the case with a regular amortized loan. The homebuyer has... a. a mortgage with power of sale. b. a growing-equity mortgage. c. a balloon payment loan. d. a reverse mortgage.

b. a growing-equity mortgage.

A title insurance policy that protects the interests of a mortgagee is called a. a leasehold policy. b. a lender's policy. c. a certificate of sale policy. d. an ALTA policy.

b. a lender's policy.

The purchase of a ticket for a professional sporting event gives the bearer what? a. an easement right to park his car b. a license to enter and claim a seat for the duration of the game c. an easement in gross interest in the professional sporting team d. a license to sell food and beverages at the sporting event

b. a license to enter and claim a seat for the duration of the game

Because a homeowner failed to pay the real estate taxes on time, the taxing authority imposed a claim against the homeowner's property. This claim is known as... a. a deed restriction b. a lien c. an easement d. a reversionary interest

b. a lien

The owner of a condominium unit learns that a neighbor has failed to pay real estate taxes. If this neighbor does not pay the taxes... a. a lien can be filed against the condominium, including all of the units b. a lien can be filed against the neighbor's unit and percentage of the common elements c. a lien can be filed only against the common areas of the condominium d. the taxing authority can order the condominium to be dissolved

b. a lien can be filed against the neighbor's unit and percentage of the common elements

If buyers seek a mortgage on a single-family house, they would be LEAST likely to obtain the mortgage from... a. a mutual savings bank b. a life insurance company c. a credit union d. a commercial bank

b. a life insurance company

The provision in a contract with a property seller that gives additional authority to the broker and obligates the broker to alert other brokers to the availability of the property is... a. a joint listing clause. b. a multiple listing clause. c. a net listing clause. d. an open listing clause.

b. a multiple listing clause.

A statement sent to an owner that does not reflect the entire debt service as an expense is called... a. a cash flow report b. a profit and loss statement c. a budget comparison statement d. an operating budget statement

b. a profit and loss statement

Which of the following deeds contains no expressed or implied warranties? a. a bargain and sale deed b. a quitclaim deed c. a warranty deed d. a grant deed

b. a quitclaim deed

An owner conveys ownership of a residence to a church but reserves a life estate in the residence. The future interest held by the church is... a. a pur autre vie b. a remainder c. a reversion d. a leasehold.

b. a remainder

An owner who sells his land and remains as a tenant of the new owner is an example of... a. a freehold b. a sale and leasehold c. secondary financing d. an installment contract

b. a sale and leasehold

A deed of trust involves all of these terms EXCEPT: a. lender. b. borrower. c. trustee. d. mortgagor.

d. mortgagor.

A tenant still has five months remaining on a one-year apartment lease. When the tenant moves to another city, the tenant transfers possession of the apartment to a friend for the entire remaining term of the lease. The friend pays rent directly to the tenant. In this situation, the tenant has become... a. an assignor b. a sublessor c. a sublessee d. a lessor

b. a sublessor

A junior lien may become first in priority if the original lender agrees to execute... a. a deed of trust. b. a subordination agreement. c. a second mortgage agreement. d. a call clause.

b. a subordination agreement.

It is mandatory for a real estate broker in Massachusetts to have... a. an errors and omissions policy b. a surety bond c. a comprehensive insurance policy d. mortgage insurance

b. a surety bond

Three people were concurrent owners of a parcel of real estate. When one of the owners died, that interest became part of the deceased's estate. The deceased was... a. a joint tenant b. a tenant in common c. a tenant by the entirety d. a severalty owner.

b. a tenant in common

An ownership interest that can be an estate interest or a right of use is... a. a leasehold b. a time-share c. a condominium d. a cooperative.

b. a time-share

The type of deed in which the grantee receives the premises with the promise that it will be free of any encumbrances is... a. a quitclaim deed b. a warranty deed c. a certificate of title d. a trust deed

b. a warranty deed

A minor is... a. barred from making contracts b. able to make a voidable contract c. exempt from making a contract d. has no business making a contract

b. able to make a voidable contract

A broker's newest sales associate lists a unit in a condominium building for sale. In this transaction, the sales associate... a. has a direct contractual relationship with the owners of the unit. b. acts on behalf of the broker. c. acts on behalf of the condominium association. d. must personally find a buyer for the unit to obtain a share of the commission.

b. acts on behalf of the broker.

General real estate taxes levied for the operation of the government are... a. assessment taxes b. ad valorem taxes c. special taxes d. improvement taxes

b. ad valorem taxes

Contamination from underground storage tanks is... a. found only in petroleum stations. b. addressed by EPA regulations. c. only caused by tanks currently in use. d. easily detected and eliminated.

b. addressed by EPA regulations.

A resident of Denver bought acreage in a distant county, never went to see the acreage, and did not use the ground. An artist moved a mobile home onto the land, had a water well drilled, and lived there for 22 years. The artist may become the owner of the land if the artist is in compliance with the state law regarding... a. requirements for a valid conveyance b. adverse possession c. avulsion d. voluntary alienation

b. adverse possession

Brenda bought acreage in a distant country, never went to see it, and did not use it, although she regularly paid the real estate taxes on it. Without Brenda's knowledge, Tara moved her mobile home onto the property, drilled a well for water, and lived there for many years. Tara may have become the owner of the acreage if she has complied with state laws regarding... a. intestate succession b. adverse possession c. the statute of frauds d. the statute of limitations

b. adverse possession

A foreclosure has taken place on a condominium property. Four months of condominium association fees have not been paid to the association. In the settlement, these fees will be paid... a. before any other debts are paid. b. after taxes are paid but before the mortgage is paid. c. after the taxes and the mortgage are paid. d. after the taxes, mortgage, and all other liens are paid.

b. after taxes are paid but before the mortgage is paid.

The system of ownership of real property in the United States is what? a. incorporeal b. allodial c. inchoate d. feudal

b. allodial

All of the following are legal deed restrictions EXCEPT... a. types of buildings that may be constructed b. allowable race of purchasers c. activities that are not to be conducted at the site d. minimum size of buildings to be constructed

b. allowable race of purchasers

P signed a deed transferring ownership of P's house to Q. To provide evidence that P's signature was genuine, P executed a declaration before a notary. This declaration is known as... a. an affidavit. b. an acknowledgment. c. an affirmation. d. an estoppel.

b. an acknowledgment.

Mrs. Reardon owns 50 acres of land with 500 feet of frontage on a desirable recreational lake. She wishes to subdivide the parcel into salable lots, but she wants to retain control over the lake frontage while allowing lot owners to have access to the lake. Which of the following types of access rights would provide the greatest protection for a prospective purchaser? a. an easement in gross b. an appurtenant easement c. an easement by necessity d. a license

b. an appurtenant easement

A property owner who has the legal right to use a neighbor's land holds... a. an estate in land b. an easement c. a police power d. an encroachment.

b. an easement

A sales associate's contract with her broker states that she is not an employee. In the past year, less than half her income was commission, with the rest an hourly wage paid by the broker. The IRS would classify her as... a. self-employed b. an employee c. an independent contractor d. a part-time real estate salesperson.

b. an employee

The new owner of a property installs a fence on the property. By mistake, the fence extends one foot over the lot line onto a neighbor's property. The fence is an example of... a. a license b. an encroachment c. an easement by necessity d. an easement by prescription.

b. an encroachment

A real estate professional has found a buyer for a seller's home. The buyer has indicated in writing a willingness to buy the property for $1,000 less than the asking price and has provided an earnest money check for $5,000. The seller is out of town for the weekend, and the real estate professional has been unable to inform the seller of the signed document. At this point, there is... a. a voidable contract. b. an offer. c. an executory agreement. d. an implied contract.

b. an offer.

The buyers of a residence in Happy Hollow have a mortgage that allows them to borrow additional funds that will be secured by the home at any time. They have... a. a closed-end loan. b. an open-end loan. c. a provisional loan. d. a fully adjustable loan.

b. an open-end loan.

A unilateral contract that becomes bilateral upon being executed is... a. an exclusive listing b. an option c. a purchase contract d. a mortgage

b. an option

In arriving at the final opinion of value, the appraiser... a. averages the methods b. analyzes the approaches and bases the value on the most appropriate approach c. will always use the market approach d. will use the assessed value of the property

b. analyzes the approaches and bases the value on the most appropriate approach

A state-certified general appraiser may... a. appraise only residential property. b. appraise any real property. c. only assist a state licensed appraiser. d. list and sell real estate for a commission.

b. appraise any real property.

A buyer is interested in a house that is well designed, but is located in a busy area that is problematic for the buyer. The buyer's concern about the property's location is called... a. physical deterioration. b. area preference. c. permanence of investment. d. immobility.

b. area preference

A Chevrolet dealer has a ground lease with the City of Malden. If the Chevrolet dealer wants to have the right to transfer all of its rights to another party, this would be an example of a/an... a. sub-lease b. assignment c. escheat d. termination

b. assignment

A buyer purchased a home under an agreement that made the buyer personally obligated to continue making payments under the seller's existing mortgage. If the buyer defaults and the court sale of the property does not satisfy the debt, the buyer will be liable for making up the difference. The buyer has... a. purchased the home subject to the seller's mortgage. b. assumed the seller's mortgage. c. benefited from the alienation clause in the seller's mortgage. d. benefited from the defeasance clause in the seller's mortgage.

b. assumed the seller's mortgage.

Salesperson Nathan wants to be classified as a qualified real estate agent - the equivalent of holding independent contractor status. All of the following are requirements for him to meet EXCEPT... a. receive substantially all of his income from the brokerage based on production, not time worked. b. be free from supervision by his broker and office manager. c. hold a current real estate license. d. have a written agreement with his broker stating that he will not be treated as an employee for federal tax purposes.

b. be free from supervision by his broker and office manager.

At the closing of a real estate transaction, the person performing the settlement gave the buyer a credit for certain accrued items. These items were... a. bills relating to the property that had already been paid by the seller. b. bills relating to the property that the buyer must pay. c. all of the seller's real estate bills. d. all of the buyer's real estate bills.

b. bills relating to the property that the buyer must pay.

A licensed real estate professional acting as a point of contact between two or more people in negotiating the sale, rental, or purchase of a property is known as a(n)... a. sales affiliate b. broker c. property manager d. appraiser

b. broker

The provisions of Regulation Z require all of the following to be disclosed to a residential buyer EXCEPT... a. discount points b. brokerage commissions c. a loan origination fee d. the loan interest rate

b. brokerage commissions

The primary activity of Freddie Mac is to... a. guarantee mortgages with the full faith and credit of the federal government b. buy and pool blocks of conventional mortgages c. act in tandem with Ginnie Mae to provide special assistance in times of tight money. d. buy and sell VA and FHA mortgages.

b. buy and pool blocks of conventional mortgages

When a prospective buyer makes a written purchase offer that the seller accepts, then the... a. buyer may take possession of the real estate. b. buyer receives equitable title to the property. c. seller grants the buyer possessory rights. d. buyer receives legal title to the property.

b. buyer receives equitable title to the property.

Fannie Mae... a. makes FHA loans b. buys FHA loans c. services FHA loans d. insures FHA loans

b. buys FHA loans

Insurance in which the insuring company is obligated to take action to defend the title, take action to perfect it, or to compensate the insured for loss is... a. mandatory b. called title insurance c. escheat d. provided by the seller

b. called title insurance

Continuing education classes in Massachusetts... a. must be taken in a classroom setting b. can be taken on the internet c. can be taken once every three years d. are not required

b. can be taken on the internet

A broker principal deposits the earnest money from a buyer into the office business account in order that the rent can be paid. This would be considered to be... a. a business expense b. commingling of funds c. legal d. a personal expense

b. commingling of funds

Market value could be determined BEST by considering... a. acquisition cost, market data, replacement b. comparison, income, replacement c. purchase price, summation cost d. income stream, acquisition cost

b. comparison, income, replacement

Which of the following is required for a salesperson or broker to renew an active license? a. be actively participating in the real estate business b. complete 12 hours of continuing education in preceding two years c. pay a fee of $225 d. complete 6 hours of continuing education in the last two years

b. complete 12 hours of continuing education in preceding two years

Permitted land uses and set-asides, housing projections, transportation issues, and objectives for implementing future controlled development would all be found in a community's... a. zoning ordinance b. comprehensive plan c. enabling act d. land-control law

b. comprehensive plan

A non-resident of Massachusetts must do which of the following to obtain a Massachusetts real estate license... a. move into the state b. conform to the same examination requirements as a Massachusetts resident c. be sponsored by an out-of-state broker d. be sponsored by a Massachusetts broker

b. conform to the same examination requirements as a Massachusetts resident

Rent would BEST be described as... a. contractual consideration to a third party b. consideration for the use of real property c. all monies paid by the lessor to the lessee d. the total balance owed under the terms of a lease

b. consideration for the use of real property

All of the following can be classified as real property EXCEPT: a. ownership in severalty b. cooperative unit ownership c. condominium unit ownership d. a tenancy in common

b. cooperative unit ownership

The real property interest that takes the form of personal property is... a. ownership in severalty b. cooperative unit ownership c. condominium unit ownership d. tenancy in common.

b. cooperative unit ownership

An appraiser would need to determine accrued depreciation when using the... a. gross rent multiplier method b. cost approach c. income approach d. sales approach

b. cost approach

A special warranty deed differs from a general warranty deed in that the grantor's covenant in the special warranty deed... a. applies only to a definite limited time b. covers the time back to the original title c. is implied and is not written in full d. protects all subsequent owners of the property

b. covers the time back to the original title

All of the following are valid reasons for terminating a buyer representation agreement EXCEPT... a. purchase of a property. b. death of the sales associate who worked with the buyer. c. agreement of the parties. d. death of the broker.

b. death of the sales associate who worked with the buyer.

All of the following reasons are valid bases for terminating a listing agreement EXCEPT... a. sale of the property b. death of the salesperson c. agreement of the parties d. destruction of the premises

b. death of the salesperson

All of the following reasons are valid bases of terminating a listing agreement EXCEPT... a. sale of the property b. death of the salesperson c. agreement of the parties d. destruction of the premises

b. death of the salesperson

At closing, the listing broker's commission generally appears as a... a. credit to the seller b. debit to the seller c. credit to the buyer d. debit to the buyer

b. debit to the seller

Accrued interest on an assumed mortgage loan is entered on the closing statement as a... a. credit to the seller and a debit to the buyer b. debit to the seller and a credit to the buyer c. credit to both the seller and the buyer d. debit to both the seller and the buyer

b. debit to the seller and a credit to the buyer

The title to real estate passes when a valid deed is... a. signed and recorded b. delivered and accepted c. filed and microfilmed d. executed and mailed

b. delivered and accepted

All of the following are categories of the uses of real property EXCEPT... a. residential b. developmental c. agricultural d. industrial

b. developmental

A real estate broker's responsibility to keep the principal informed of all the facts that could affect a transaction is the duty of... a. care b. disclosure c. obedience d. accounting

b. disclosure

A real estate broker's responsibility to keep the principal informed of all the facts that might affect a transaction is the duty of... a. care b. disclosure c. obedience d. accounting

b. disclosure

A man buys real estate that is registered land. For the transfer to be valid, he MUST... a. record the deed at the Registry of Deeds. b. have a new certificate of title issued in his name. c. institute a suit to quiet title. d. record the land court certificate in his name.

b. have a new certificate of title issued in his name.

Applicants for a salesperson's license must... a. be at least 18 years old and have completed a 12-hour exam prep course. b. have completed 40 classroom hours of instruction in real estate subjects. c. have been actively engaged in real estate activities for at least six months. d. submit recommendations from three persons, two of whom are Massachusetts residents.

b. have completed 40 classroom hours of instruction in real estate subjects.

Advantages of an investment in real estate include all of the following EXCEPT: a. the possibility of a tax-deferred exchange b. high liquidity c. the use of leverage to increase rates of return d. tax deductions

b. high liquidity

Seller Caden tells the broker that he wants to net out a net price of $225,000 and the broker can retain any amount over that as his commission. In Massachusetts, that would be... a. an exclusive listing b. illegal c. advantageous to the seller d. advantageous to the agent

b. illegal

Gerry and Nancy bought a store building and took title as joint tenants. Nancy died testate. Gerry now owns the store: a. as a joint tenant with rights of survivorship b. in severalty c. as a tenant in common with Nancy's heirs d. in trust

b. in severalty

Housing that qualifies for exemption from familial status provisions... a. includes housing intended for persons 50 or older. b. includes a restriction that 80% of the units be occupied by persons 55 or older. c. is not permitted under the federal Fair Housing Act. d. is permitted for owner-occupied buildings with four or more units.

b. includes a restriction that 80% of the units be occupied by persons 55 or older.

A cap rate is used in what type of appraisal? a. reproduction b. income approach c. tax assessment d. competitive market analysis

b. income approach

Urea formaldehyde is found in residential properties in... a. lead-based paints b. insulating foam c. home appliances d. electromagnetic fields

b. insulating foam

Urea-formaldehyde is found in residential properties in... a. lead-based paints b. insulating foam c. home appliances d. USTs

b. insulating foam

A seller when asked by a broker to fill out a property condition disclosure, which of the following is true? a. only if the buyer requests b. it is optional in Massachusetts c. the disclosure is mandatory d. the broker should fill it out because you have hired him as your agent

b. it is optional in Massachusetts

In a closing statement, a prepaid item is a(n)... a. item paid in advance by buyer b. item that is prepaid by the seller c. accrued expense d. charge to the seller

b. item that is prepaid by the seller

Which of the following BEST defines real property? a. land and the air above it b. land and the area below and above the surface to identity and all the improvements thereon c. the land, buildings thereon, and anything permanently affixed to the land and/or buildings d. land and the mineral rights in the land

b. land and the area below and above the surface to identity and all the improvements thereon

The amount of a loan expressed as a percentage of the value of the real estate offered as collateral is the... a. amortization ratio b. loan-to-value ratio c. debt-to-equity ratio d. capital-use ratio

b. loan-to-value ratio

In Massachusetts, the Smoke Detector Law requires that... a. buyers must inspect the property b. local fire departments must inspect and test the units c. brokers have to pay the cost of inspection d. no inspection is required

b. local fire departments must inspect and test the units

The amount of money a property is likely to command in the marketplace is its... a. intrinsic value b. market value c. subjective value d. book value

b. market value

In describing real estate, the method that may use a property's physical features to determine boundaries and measurements is... a. rectangular survey b. metes and bounds c. government survey d. lot and block.

b. metes and bounds

The return of land to the grantor or grantor's heirs when the grant is over is BEST described as... a. remainder b. reversion c. kickback d. surrender

b. reversion

The type of real estate loan that allows the lender to increase the outstanding balance of a loan up to the original sum in the note while advancing additional funds is the... a. wraparound mortgage b. open-end mortgage c. growing-equity mortgage d. graduated-payment mortgage

b. open-end mortgage

Under the negotiated terms of a commercial lease, the landlord is required to maintain the water heater used in a health club. If the tenant is unable to get hot water because of a faulty water heater that the landlord has failed to repair after repeated notification, the tenant could do all of the following EXCEPT... a. sue the landlord for damages. b. order a new water heater and deduct the payment from the rent. c. abandon the premises claiming constructive eviction. d. terminate the lease agreement.

b. order a new water heater and deduct the payment from the rent.

A seller listed a residence with a broker. The broker brought an offer at full price and terms of the listing agreement from a buyer who is ready, willing, and able to pay cash for the property, but the seller rejected the buyer's offer. In this situation, the seller... a. must sell the property. b. owes a commission to the broker. c. is liable to the buyer for specific performance. d. is liable to the buyer for compensatory damages.

b. owes a commission to the broker.

A property manager's primary obligation is to... a. tenants b. owners c. bankers d. government authorities

b. owners

Which of the following is NOT a form of co-ownership? a. tenancy in common b. ownership in severalty c. tenancy by the entirety d. community property

b. ownership in severalty

A sales associate wants to be classified by the IRS as a qualified real estate agent—the equivalent of holding independent contractor status for tax purposes. The sales associate must meet all of the following requirements EXCEPT... a. receive substantially all income from the brokerage based on production, not time worked. b. perform all work unsupervised by the managing broker. c. hold a current real estate license. d. have a written agreement with the broker stating that the sales associate will not be treated as an employee for federal tax purposes.

b. perform all work unsupervised by the managing broker.

In order to be valid all exclusive listings must include: a. a definite date of expiration b. permission for the listing broker to appoint subagents c. an automatic renewal clause d. a forfeiture clause

b. permission for the listing broker to appoint subagents

A truckload of lumber that a homeowner purchased has been left in the driveway for use in building a porch. The lumber is considered... a. real property b. personal property c. a chattel that is real property d. a trade or chattel fixture.

b. personal property

Defined as a loss in value from any cause, depreciation is generally divided into three categories. The loss of value due to the normal wear and tear on a property is called... a. external depreciation b. physical deterioration c. functional obsolescence d. economic deterioration

b. physical deterioration

It is illegal for a lending institution to refuse to make a residential real estate loan in a particular area only because of... a. questionable economic situation of the applicant b. physical location of the property c. applicant not being of legal age d. deteriorated condition of the premises

b. physical location of the property

In general, when the supply of a certain commodity increases, ... a. price tends to rise b. price tends to drop c. demand for it tends to rise d. demand for it tends to drop

b. price tends to drop

A real estate broker was responsible for a chain of events that resulted in the sale of a client's property. This is called... a. pro forma b. procuring cause c. private offering d. proffered offer.

b. procuring cause

The process by which expenses are handled at settlement of a real estate transaction so that both the buyer and the seller pay their respective portions of property charges is called... a. assessment b. proration c. balancing d. reconciliation

b. proration

A buyer makes an offer to purchase certain property listed with a real estate professional and leaves an escrow deposit with the real estate professional to show good faith. The real estate professional should... a. immediately apply the deposit to the listing expenses. b. put the deposit in an account, as provided by state law. c. give the deposit to the seller when the offer is presented. d. put the deposit in the real estate professional's personal checking account.

b. put the deposit in an account, as provided by state law.

A condition in the lease in which the tenant is entitled to peaceful possession is called... a. prevention of waste b. quiet enjoyment c. escheat d. tenancy at sufferance

b. quiet enjoyment

Ventilation will mitigate... a. lead paint b. radon gas c. UFFI d. defects

b. radon gas

All of the following liens need to be recorded to be valid EXCEPT: a. mortgage lien b. real estate tax lien c. judgement lien d. mechanics lien

b. real estate tax lien

To give constructive notice of ownership, the buyer must... a. comply with RESPA requirements b. record the deed c. be a beneficiary d. sign the deed

b. record the deed

The right of a mortgagor has to regain the property by paying the debt after a foreclosure sale is called... a. acceleration b. redemption c. reversion d. recapture

b. redemption

Molly is a licensed real estate salesperson. She has a written agreement with her broker indicated she will not be treated as an employee. Molly's income is solely from commissions. She does not receive an hourly wage. The IRS will MOST likely consider Molly... a. a real estate assistant b. self-employed c. an employee d. a subagent

b. self-employed

A liquidated damages clause permits the... a. buyer to recover the earnest money deposit. b. seller to retain all or part of the earnest money deposit. c. broker to retain all of the earnest money deposit. d. seller to impose a fine on the buyer in case of a breach.

b. seller to retain all or part of the earnest money deposit.

The essential elements of a contract include all of the following EXCEPT... a. offer and acceptance b. signatures of the parties c. competent parties d. consideration

b. signatures of the parties

The relationship of a broker to a buyer in an exclusive buyer agency contract is that of a... a. principle agent b. single agent c. facilitator d. dual agent

b. single agent

If Mr. and Mrs. Bates, the sellers, signed a Purchase and Sales Agreement with Mr. and Mrs. Ryan, and then for no apparent reason, refused to go through with the sale, the buyer(s) could sue for... a. adverse possession b. specific performance c. adverse easement d. dower rights

b. specific performance

Deed restrictions are created by all of the following EXCEPT: a. deed b. statute c. written agreement d. general plan of subdivision

b. statute

Leading prospective home buyers to or away from certain areas would be... a. redlining b. steering c. legal d. a violation of RESPA

b. steering

In a cooperative, the buyer of a unit becomes the... a. unit owner b. stockholder in the cooperative c. adverse tenant d. estoppel tenant

b. stockholder in the cooperative

In a cooperative, the buyer of a unit becomes... a. unit owner b. stockholder in the cooperative c. adverse tenant d. estoppel tenant

b. stockholder in the cooperative

Adaptations of property specifications to suit tenant requirements are... a. tax-exempt improvements b. tenant improvements c. rohibited by most nonresidential leases d. enerally not a good idea

b. tenant improvements

Programs to help families purchase or operate family farms are provided by... a. Ginnie Mae b. the Farm Service Agency c. Fannie Mae d. the Federal Housing Finance Agency

b. the Farm Service Agency

A developer received a loan that covers five parcels of real estate and provides for the release of the mortgage lien on each parcel when certain payments are made on the loan. This type of loan arrangement is called... a. the purchase money loan b. the blanket loan c. the package loan d. the wraparound loan

b. the blanket loan

A prospective buyer signs an agreement with a broker to find a property for the buyer, and the buyer agrees to work only with that broker. While this agreement is in effect, ... a. only one sales associate of the broker can work with the buyer. b. the broker can represent other buyers. c. the broker cannot show the buyer a property that is listed by the broker. d. the sales associate working with the buyer cannot work with other buyers.

b. the broker can represent other buyers.

If a buyer withdraws an offer to purchase after it has been accepted by the seller, ... a. the buyer is entitled to reimbursement of the earnest money. b. the buyer forfeits the earnest money. c. the buyer owes the broker a commission. d. the buyer must pay the advertising expenses.

b. the buyer forfeits the earnest money.

The document that sets forth the maximum loan guarantee to which a veteran is entitled is... a. the funding statement. b. the certificate of eligibility. c. the certificate of reasonable value. d. the certificate of discharge.

b. the certificate of eligibility.

All of the following are typically found in a listing agreement EXCEPT... a. the price the seller is asking for the property. b. the date the broker will schedule an open house. c. the commission rate to be paid to the listing broker. d. the responsibilities of the broker.

b. the date the broker will schedule an open house.

In a limited partnership... a. the number of investors is limited to 10. b. the general partners run the business. c. all the partners participate in running the business. d. investors may participate with only a small amount of capital but with unlimited liability.

b. the general partners run the business.

When a tenant holds possession of a landlord's property without a current lease agreement and without the landlord's approval, ... a. the tenant is maintaining a gross lease. b. the landlord can file suit for possession. c. the tenant has no obligation to pay rent. d. the landlord may be subject to a constructive eviction.

b. the landlord can file suit for possession.

Discount points on a mortgage are computed as a percentage of... a. the selling price b. the loan amount c. the closing costs d. the down payment

b. the loan amount

What would MOST affect the value of real estate? a. the appraisal b. the location c. the book value d. the age of the building

b. the location

All of the following would be permitted under the federal Fair Housing Act EXCEPT... a. an expensive club in New York renting rooms only to members who are graduates of a particular university b. the owner of a 20-unit residential apartment building renting to men only c. a Catholic convent refusing to furnish housing for a Jewish man d. an owner refusing to rent the other side of the duplex in which she lives to a family with children

b. the owner of a 20-unit residential apartment building renting to men only

What will happen to real estate when its deceased owner did not write a will and has no heirs? a. the ownership will pass by devise b. the ownership will pass escheat c. the courts will seize the ownership d. the ownership will revert to the previous owner

b. the ownership will pass escheat

In designated agency, all of the following apply EXCEPT... a. the broker could be a dual agent. b. the same agent may represent both the buyer and the seller at the same time. c. the broker can choose an agent in the office to represent the seller. d. the broker may appoint an agent to negotiate for the buyer.

b. the same agent may represent both the buyer and the seller at the same time.

All encumbrances and liens shown on the report of title, other than those waived or agreed to by the purchaser and listed in the contract, must be removed so that the title can be delivered free and clear. The removal of such encumbrances is typically the duty of... a. the buyer b. the seller c. the real estate professional d. the title company

b. the seller

Seller Jones sells property to Buyer Mulligan. The transfer deed tax is $1,368. Who owes the tax? a. the buyer b. the seller c. both a and b d. the mortgagor

b. the seller

Tenancy with survivorship means... a. the tenancy interest will be inherited b. the tenancy interest will pass to the surviving tenants upon the death of one c. the tenant's heirs are survivors d. this is not a legal tenancy

b. the tenancy interest will pass to the surviving tenants upon the death of one

An ownership interest that is based on annual occupancy intervals is a... a. leasehold b. time share c. condo d. cooperative

b. time share

Which of the following provides a buyer with the best assurance of clear, marketable title? a. certificate of title b. title insurance c. abstract of title d. general warranty deed

b. title insurance

The best reason for a buyer to obtain title insurance is... a. that the mortgage lender requires it b. to ensure that the seller can deliver marketable title c. to ensure that the abstractor has prepared a complete summary of title d. to pay future liens that may be filed

b. to ensure that the seller can deliver marketable title

The BEST reason for a buyer to obtain title insurance is... a. that the mortgage lender requires it. b. to ensure that the seller can deliver marketable title. c. to ensure that the abstractor has prepared a complete summary of title. d. to pay future liens that may be filed.

b. to ensure that the seller can deliver marketable title.

The title to real estate passes when a valid deed is: a. signed and recorded b. transfer title rights c. give constructive notice d. prevent adverse possession

b. transfer title rights

Generally, an oral lease for five years is... a. illegal b. unenforceable c. a short-term lease d. renewable only in writing

b. unenforceable

Charging more interest than is legally allowed is known as... a. escheat b. usury c. a deficiency d. an estoppel

b. usury

A void contract is one that... a. was not in writing. b. was never legally enforceable. c. was rescindable by agreement. d. was voidable by only one of the parties.

b. was never legally enforceable.

A tenant complained to HUD about his landlord's discriminatory practices in his/her building. A week later the landlord gave the tenant an eviction notice. Under which of the following situations would the Federal Fair Housing Act be violated? a. when the tenant is two months behind in his/her rent b. when the landlord evicts the tenant for reporting him to HUD c. when the tenant has damaged the premises d. when the tenant is conducting an illegal use on the premises

b. when the landlord evicts the tenant for reporting him to HUD

In absence of an agreement to the contrary, the mortgage having priority will be the one... a. for the highest amount b. which was recorded first c. which was signed first d. that is a construction loan

b. which was recorded first

Grantee is to a deed as devisee is to a... a. trust b. will c. estate d. leasehold

b. will

When must the Loan Estimate be given to a borrower? a. at first meeting b. within 3 days of completion of application c. when asked for by borrower d. at closing

b. within 3 days of completion of application

If a Title 5 inspection cannot be completed because of snow covering the septic tank, when must it be done? a. never b. within 6 months as long as the buyer and seller are aware it must be done c. when the house is sold again d. the snow must be cleared and the inspection done prior to closing

b. within 6 months as long as the buyer and seller are aware it must be done

When acting as an employee rather than an independent contractor, a sales associate may be obligated to... a. list properties in the sales associate's own name b. work set hours c. accept a commission from another broker d. personally pay all withholding taxes

b. work set hours

A lease in Massachusetts, to be valid, must be... a. oral b. written c. a percentage of rent collected d. none of the above

b. written

The commission on the sale of a house is $9,410, and 30% goes to the broker who listed the property. Of the remainder, the broker whose sales associate completed the transaction gets 45%, and the sales associate receives the balance. How much does the sales associate who made the sale receive? a. $4,389 b. $3,728 c. $3,622.85 d. $2,425

c. $3,622.85

The current market value of a property is $255,000, and it is assessed at 35% of its current market value with an equalization factor of 1.25. What is the amount of real estate tax due if the tax rate is $3.50 per $100 of assessed value? a. $2,756.25 b. $3,445.31 c. $3,904.69 d. $4,880.26

c. $3,904.69

A buyer purchased a half-acre parcel for $2.15 per square foot. What was the selling price of the parcel? a. $774 b.$1,376 c. $46,827 d. $93,654

c. $46,827

A sales associate took a listing on a house that sold for $329,985. The commission rate was 5%. A sales associate employed by another broker found the buyer. The seller's broker received 60% of the commission on the sale; the buyer's broker received 40%. If the seller's broker kept 30% and paid the seller's sales associate the remainder, how much did the seller's sales associate earn on this sale? a. $4,346.85 b. $5,774.74 c. $6,929.68 d. $8,249.00

c. $6,929.68

A property owner wishes to net $56,500 from the sale of her small building. After paying an advertising allowance of $160 and a 7% commission, what must the selling price be, rounded to the nearest dollar? a. $60,455 b. $60,626 c. $60,753 d. $60,925

c. $60,925 sales price - $56,500 net proceeds + $160 ad allowance - $56,660. - $56,660 divided by 93% (100% total costs - 7% commission) = $60,925 sales price

A home mortgage loan closed on July 1 for $765,000 at 5.5% interest amortized over 25 years at $4,697.77 per month. Using a 360-day year, what would the principal amount be after the monthly payment was made August 1? a. $764,936.30 b. $764,106.25 c. $763,808.48 d. $754,275.00

c. $763,808.48

An investment property was bought for $385,000. The land value was $140,000. If the useful life of the property is thirty years, what is the annual depreciation? a. $12,833 b. $4,667 c. $8,167 d. $17,500

c. $8,167

If a lender agrees to make a loan based on an 80% LTV, what is the amount of the loan if the property appraises for $114,500 and the sales price is $116,900? a. $83,200 b. $91,300 c. $91,600 d. $92,900

c. $91,600

An aggrieved party with a Fair Housing violation claim has how long to file a complaint with the Department of Housing and Urban Development? a. 1 month b. 1 week c. 1 year d. 7 years

c. 1 year

Which of the following investments cannot be depreciated? a. shopping mall b. single family home c. 100 acres of vacant land d. commercial building

c. 100 acres of vacant land

How many days after the recording of a Statement of Account does a contractor or subcontractor have to file a mechanic's lien? a. 30 days b. 60 days c. 90 days d. 120 days

c. 90 days

Which of the following BEST describes a voidable contract? a. A contract that has no legal effect and never had any b. An oral contract with no witnesses to the agreement c. A contract that may be either enforced or declared void by one of the parties d. A contract that has been accepted but the acceptance has not been communicated to the offeror.

c. A contract that may be either enforced or declared void by one of the parties

Which transaction is BEST described as involving a ground lease? a. A landowner agrees to let a tenant drill for oil on a property for 75 years. b. The tenant agrees to pay a proportionate, increased rental based on annual appraisals of the rented property. c. A landlord charges a commercial tenant separate amounts for the land and the leased building. d. The tenant pays a base amount for the property plus a percentage of business-generated income.

c. A landlord charges a commercial tenant separate amounts for the land and the leased building.

What would be evidence of a debt? a. A trust deed b. An abstract of title c. A promissory note d. A special note indicating money is owed

c. A promissory note

A person or company responsible for maintaining a client's property and maximizing the return on the client's investment is serving as: a. A rental agent b. A building maintenance specialist c. A property manager d. An investment counselor

c. A property manager

Which of the following would be used to clear a defect from the title records? a. A lis pendens b. An estoppel certificate c. A suit to quiet title d. A writ of attachment

c. A suit to quiet title

A buyer defaults in making payments on a loan, therefore the lender's action probably would result in: a. Subordination b. Escalation c. Acceleration d. Alienation

c. Acceleration

Which of the following is NOT used by an appraiser applying the income approach to value? a. Annual net operating income b. Capitalization rate c. Accrued depreciation d. Annual gross income

c. Accrued depreciation

Which of the following, if true, would NOT be grounds for revoking the broker's or salesperson's license? a. Paying a commission to an unlicensed person who acted as a real estate salesperson b. Inducing a seller to break a contract so the broker can present a higher offer c. Affirmatively soliciting residential properties for sale d. Accepting a disclosed, voluntary, net listing from a prospective seller

c. Affirmatively soliciting residential properties for sale

When is a certificate of occupancy issued? a. When the owner of a multifamily residential property wishes to limit the number of individuals who may live in a single unit b. At the time a property owner applies for a building permit c. After building construction work has been inspected and found satisfactory by the municipal inspector d. When an application for a variance or conditional-use permit has been granted by the zoning board

c. After building construction work has been inspected and found satisfactory by the municipal inspector

Removing existing barriers when readily achievable in public buildings, such as adding Braille markings to elevator buttons, is a requirement of which law? a. Fair Housing Act b. Equal Credit Opportunity Act c. Americans with Disabilities Act d. Regulation Z

c. Americans with Disabilities Act

The term reconciliation refers to which of the following? a. Loss of value due to any cause b. Separating the value of the land from the total value of the property to compute depreciation c. Analyzing the results obtained by the different approaches to value to form an opinion of value d. The process by which an appraiser determines the highest and best use for a parcel of land

c. Analyzing the results obtained by the different approaches to value to form an opinion of value

An FHA-insured mortgage loan would be obtained from which of the following? a. The Federal Housing Administration b. The Department of Housing and Urban Development c. Any FHA-approved lending institution d. Any FHA-approved insuring institution

c. Any FHA-approved lending institution

An FHA-insured mortgage loan would be obtained from which of the following? a. The Federal Housing Administration b. The Department of Housing and Urban Development c. Any FHA-approved lending institution d. Any FHA-approved insuring institution

c. Any FHA-approved lending institution

A real estate professional showed a pre-World War I house to a prospective buyer. The buyer has two toddlers and is worried about potential health hazards. Which of the following is TRUE? a. There is a risk that urea-formaldehyde foam insulation was used in the original construction. b. The real estate professional can offer to personally inspect for lead and remove any lead risks. c. Because of the age of the house, there is a good likelihood of the presence of lead-based paint. d. Removal of lead-based paint and asbestos hazards is covered by standard title insurance policies.

c. Because of the age of the house, there is a good likelihood of the presence of lead-based paint.

Which of the following applies to a security deposit in Massachusetts? a. It cannot exceed one month's rent b. It must be deposited in an interest-bearing escrow account c. Both a and b are correct d. Neither a nor b is correct

c. Both a and b are correct

Which of the following is a similarity between an exclusive agency listing and an exclusive right-to-sell listing? a. Under each, the seller retains the right to sell the real estate without the broker's help and without paying the broker a commission. b. Under each, the seller authorizes only one particular sales associate to show the property. c. Both types of listings give the responsibility of representing the seller to one broker only. d. Both types of listings are open listings.

c. Both types of listings give the responsibility of representing the seller to one broker only.

Which of the following would be considered a variable expense when a manager develops an operating budget? a. Employee wages b. Utilities c. Building repairs d. Basic operating costs

c. Building repairs

Title III of the Americans with Disabilities Act (ADA) impacts which type of property? a. Residential b. Industrial c. Commercial and public accommodations d. Privately owned

c. Commercial and public accommodations

Which of the following is NOT recognized in Massachusetts? a. Tenancy in common b. Quarter-share c. Common property d. Tenancy by the entirety

c. Common property

CMA is the abbreviation for which of the following? a. Comparative Market Appraisal b. Comparative Marketing Agreement c. Comparative Market Analysis d. Competitive Market Accounting

c. Comparative Market Analysis

Which of the following is an involuntary alienation of property? a. Quitclaim b. Inheritance c. Condemnation d. Gift

c. Condemnation

An apartment complex is severely damaged by a tornado, making it uninhabitable. What type of insurance covers the landlord against the resulting loss of rent? a. Fire and hazard b. Liability c. Consequential loss, use, and occupancy d. Casualty

c. Consequential loss, use, and occupancy

Which of the following is NOT a participant in the secondary mortgage market? a. Fannie Mae b. Ginnie Mae c. Credit union d. Freddie Mac

c. Credit union

All of the following affect how quickly the forces of supply and demand work EXCEPT: a. A property's specific geographic location b. Immobility of a property c. Degree of standardization of the property's price d. Uniqueness of a property

c. Degree of standardization of the property's price

Which of the following should a broker NOT do in regard to list price? a. Give the seller advice b. Provide information about comparable values c. Determine the list price d. Express concern about the seller's selected price

c. Determine the list price

What does the phrase the law of agency is a common law doctrine mean? a. It is a legal doctrine that is not unusual. b. It is one of the rules enacted by legislatures and other governing bodies. c. It is part of a body of law established by tradition and court decisions. d. It may not be superseded by statutory law.

c. It is part of a body of law established by tradition and court decisions.

A broker has four prospective clients: Joe refuses to sell to Boman Catholics, Kim refuses to sell to people of Welsh descent, Lee refuses to sell to people who own foreign cars, and Mike refuses to sell to "rich white guys". Which of the broker's prospective clients is engaging in unlawful discrimination? a. Joe, Kim, and Lee only b. Lee and Mike only c. Joe, Kim, and Mike only d. Joe, Kim, Lee, and Mike

c. Joe, Kim, and Mike only

Which of the following is classified as a general lien? a. Mechanic's lien b. Bail bond lien c. Judgment d. Real estate taxes

c. Judgment

Mortgagee title policies protect which parties against loss? a. Buyers b. Sellers c. Lenders d. Buyers and lenders

c. Lenders

A guest slips on an icy apartment building stair and is hospitalized. A claim against the building owner for medical expenses may be paid under which of the following policies held by the owner? a. Workers' compensation b. Casualty c. Liability d. Fire and hazard

c. Liability

Which of the following is a voluntary, specific lien? a. IRS tax lien b. Mechanic's lien c. Mortgage lien d. Seller's lien

c. Mortgage lien

An employee of a real estate corporation licensed as a real estate professional that is working as a member of the corporate's sales staff: a. Does not require a real estate salesperson's license b. Must be a licensed real estate broker c. Must be a licensed real estate salesperson or broker d. Does not require a real estate license provided that person is an officer of the corporation

c. Must be a licensed real estate salesperson or broker

Which of the following are required for a property manager? a. Must have a real estate salesperson's license b. Must have a college degree c. Must be hired by a property owner d. Must have a broker's license

c. Must be hired by a property owner

The listing agreement on a residential property states that it expires on May 2. Which event would terminate the listing before that date? a. The agreement is renewed before May 2. b. The owner becomes ill on April 29. c. On April 15, the owner and agent cancel the agreement. d. The house is destroyed by fire on May 3.

c. On April 15, the owner and agent cancel the agreement.

Which of the following is a voluntary alienation of the property? a. Adverse possession b. Condemnation c. Owner sale d. Foreclosure

c. Owner sale

A broker has received three offers on a property within an hour. The property is listed for $210,000. Offer-A is for $209,500, offer-B is for $190,000, and offer-C is for $175,000. What should she do? a. Ignore offer C because it is ridiculously low b. Find out if the makers of offers A and B want to raise their offers under the circumstances c. Present all offers immediately d. Present the highest offer only

c. Present all offers immediately

Broker James received an offer of $195,000 on a property listed at $200,000. Before he presents the offer to the seller, he receives another offer from a different buyer for $202,000. What must broker James do? a. Call the first buyer and reject the offer of $195,000 b. Present only the highest offer c. Present both offers d. Decide which is the best offer

c. Present both offers

A primary justification for zoning ordinances is to: a. Maintain conformity b. Prevent an oversupply of certain types of businesses c. Promote public health, safety, morals, and general welfare d. Control the quality of building construction

c. Promote public health, safety, morals, and general welfare

Which tax targets homeowners in particular? a. Personal property tax b. Franchise tax c. Real property tax d. Luxury tax

c. Real property tax

Under the Fair Housing Act, which action is legally permitted? a. Advertising property for sale only to a special group b. Altering the terms of a loan for a member of a protected class c. Refusing to make a mortgage loan to a member of a protected class because of a poor credit history d. Telling a member of a protected class that an apartment has been rented when in fact it has not

c. Refusing to make a mortgage loan to a member of a protected class because of a poor credit history

A buyer makes an earnest money deposit of $1,500 on a $15,000 property and then withdraws her offer before the seller can accept it. The broker is responsible for disposing of the earnest money by: a. Turning it over to the seller b. Deducting the commission and giving the balance to the seller c. Returning it to the buyer d. Depositing it in his or her trust

c. Returning it to the buyer

Which of the following BEST defines the law of agency? a. Selling of another's property by a properly licensed brokerage company b. Principles that govern conduct in business c. Rules of law that apply to the responsibilities of a person who acts as agent for another d. Rules and regulations of the state's licensing agency

c. Rules of law that apply to the responsibilities of a person who acts as agent for another

A purchaser went to the county building to check the recorder's records, which showed that the seller was the grantee in the last recorded deed and that no mortgage was on record against the property. The purchaser may assume which of the following? a. All taxes are paid and no judgments are outstanding. b. The seller has good title. c. The seller did not mortgage the property. d. No one else is occupying the property.

c. The seller did not mortgage the property.

If a seller collected rent of $900 from the buyer, payable in advance, on August 1, which statement is TRUE at the closing on August 15, if the closing date is an expense to the seller? (Use a 30-day month) a. The seller owes the buyer $900 b. The buyer owes the seller $900 c. The seller owes the buyer $450 d. The buyer owes the seller $450.

c. The seller owes the buyer $450

Many real estate contracts are in writing on forms. Parts of these contracts are written and parts are printed. In the interpretation of such contracts: a. Printed parts take preference over the written parts b. The written parts and the printed parts are given equal consideration c. The written parts take preference over the printed parts d. Any parts copied from the form take preference over those that are purely original

c. The written parts take preference over the printed parts

Homeowners are frantic because they want to sell their property and the deed is missing. Which of the following is TRUE? a. They may need to sue for quiet title. b. They must buy title insurance. c. They do not need the original deed if it has been recorded. d. They should execute a replacement deed to themselves.

c. They do not need the original deed if it has been recorded.

Which statement MOST accurately describes special assessment liens? a. They are general liens. b. They are paid on a monthly basis. c. They take priority over mechanics' liens. d. They cannot be prepaid in full without penalty.

c. They take priority over mechanics' liens.

A condominium rule prohibits pets. Art, a prospective buyer with a physical disability, relies on an animal to assist him. Which of the following is TRUE? a. A condominium has the right to establish such a private restriction if it chooses. b. This restriction is unenforceable only if the animal is used to assist people with visual impairments. c. This restriction is unenforceable when a person uses an animal for disability related assistance in any way. d. The condominium can waive the enforcement of the covenant only if there are suitable accommodations in the complex for an animal.

c. This restriction is unenforceable when a person uses an animal for disability related assistance in any way.

The usual period during which Massachusetts lenders advertise a property that is in foreclosure proceedings prior to sale is how many weeks? a. One b. Two c. Three d. Four

c. Three

An owner purchased an interest in a house in Beachfront. The owner is entitled to the right of possession only between July 10 and August 4 of each year. Which of the following is MOST likely the type of ownership that has been purchased? a. Cooperative b. Condominium c. Time-share d. Partnership

c. Time-share

Which of the following is NOT covered by a standard title insurance policy? a. Forged documents b. Incorrect marital statements c. Unrecorded rights of parties in possession d. Incompetent grantors

c. Unrecorded rights of parties in possession

An attorney drew up a contract between a buyer and a seller for the purchase of a property. The agreement included a liquidated damages clause calling for the payment of $500 in the event the buyer should default. Prior to the close of the escrow, the buyer decided that the home would not suit his family and canceled the purchase. If the seller were to sue for specific performance, he would most likely be... a. Successful because of the $500 id not adequate considering the value of the property b. Successful because the reason for canceling by the buyer was not strong c. Unsuccessful because the seller agreed to accept the $500 as liquidated damages in the contract d. Unsuccessful because an attorney drew the contract

c. Unsuccessful because the seller agreed to accept the $500 as liquidated damages in the contract

Change, contribution, plottage, and substitution are some of the basic principles that affect what aspect of real estate? a. Demand b. Depreciation c. Value d. Supply

c. Value

Which factor is MOST likely to influence demand for real estate? a. Number of real estate professionals in the area b. Number of full-time real estate professionals in the area c. Wage levels and employment opportunities d. Price of new homes being built in the area

c. Wage levels and employment opportunities

The difference between rescission and waiver is that... a. Rescission is assignable b. Waiver is retroactive c. Waiver leaves parties as they are d. Waiver allows specific performance

c. Waiver leaves parties as they are

Which of the following is NOT a type of listing contract? a. Open b. Exclusive agency c. Exclusive right to sell d. MLS

d. MLS

A buyer signed an agreement with a broker to compensate the broker even if the buyer purchases the property from a relative. This is called... a. an open buyer representation agreement. b. an exclusive agency buyer representation agreement. c. an exclusive buyer representation agreement. d. an invalid agreement.

c. an exclusive buyer representation agreement.

Regardless of who sells the house, the broker will collect a commission. This type of listing offers the most protection, therefore, to the broker. This is called... a. an open listing b. a net listing c. an exclusive right to sell listing d. an exclusive agency listing

c. an exclusive right to sell listing

A seller sold property to a neighbor without the services of a real estate broker; however, the seller still owes a broker a commission because the seller signed... a. an exclusive agency listing agreement. b. an open listing agreement. c. an exclusive right-to-sell listing agreement. d. a net listing agreement.

c. an exclusive right-to-sell listing agreement.

Real estate generally includes all the following EXCEPT... a. trees b. air rights c. annual crops d. mineral rights.

c. annual crops

Funds for FHA-insured loans are usually provided by... a. the FHA b. the Federal Reserve c. approved lenders d. the seller

c. approved lenders

A father and son could hold title together... a. in severalty b. as tenants by the entirety property c. as joint tenants d. as community

c. as joint tenants

An agency disclosure MUST be presented to the buyer... a. at the time of closing b. by the bank's attorney c. at the first personal meeting with a buyer to discuss a specific property d. at the time of the offer

c. at the first personal meeting with a buyer to discuss a specific property

An agency disclosure MUST be presented to the buyer... a. at time of closing b. by bank's attorney c. at the first personal meeting with a buyer to discuss a specific property d. at the time of the offer

c. at the first personal meeting with a buyer to discuss a specific property

All of the following instruments transfer an interest in real property EXCEPT a(n)... a. option b. lease c. bill of sale d. agreement of sale

c. bill of sale

The Massachusetts Mandatory Licensee-Consumer Relationship Disclosure requires that which of the following parties be given the agency disclosure? a. seller b. buyer c. both d. none of the above

c. both

A facilitator has which of the following duties? a. to be honest b. to account for funds c. both a and b d. the facilitator has no duties

c. both a and b

In Massachusetts, when there is a change of business address, who must notify the Board of Registration of Real Estate Brokers and Salespersons? a. the licensee b. the broker c. both a and b d. neither a nor b

c. both a and b

Instructors for salesperson and broker licensing must... a. be authorized by the Board of Registration b. hold a current broker's license c. both a and b d. none of the above

c. both a and b

A seller hired a broker under the terms of an open listing agreement. While that agreement was still in effect, the seller—without informing the first broker—hired another broker from a separate firm under an exclusive right-to-sell listing for the same property. If the first broker produces a buyer for the property whose offer the seller accepts, the seller must pay a full commission to... a. only the first broker. b. only the second broker. c. both brokers. d. neither broker.

c. both brokers.

In a dual agency situation, if it is permitted by state law, a broker may represent both the seller and the buyer in the same transaction provided... a. the broker informs either the buyer or the seller of this fact. b. the buyer and the seller are related by blood or marriage. c. both parties consent in writing to the dual agency. d. both parties are represented by attorneys.

c. both parties consent in writing to the dual agency.

Dual agency, under Massachusetts's regulations, is allowed when... a. the agent has disclosed the dual agency prior to a closing b. the agent is not required to disclose the agency under MA regulations c. both the seller and buyer have been disclosed and both have been given informed written consent d. both buyer and seller have been disclosed prior to the signing of a Purchase and Sales Agreement

c. both the seller and buyer have been disclosed and both have been given informed written consent

The Massachusetts Consumer Protection Act requires that the... a. broker keep all information that the seller has provided confidential. b. broker disclose everything that the seller tells him. c. broker disclose known material information that might affect the sale even though the buyer does not ask for it. d. seller disclose all facts that might affect the sale.

c. broker disclose known material information that might affect the sale even though the buyer does not ask for it.

A joint tenancy with right of survivorship may be created... a. automatically if the property is distributed to the surviving children b. by presumption if another form of ownership is not described c. by deed or will d. automatically if a deed is signed by both spouses

c. by deed or will

A buyer-agent... a. always has to be paid directly by the buyer. b. is not entitled to any compensation. c. can be paid his or her compensation from the proceeds of the sale. d. can be paid his or her compensation by the lessor.

c. can be paid his or her compensation from the proceeds of the sale.

Another term for personal property is... a. realty b. fixtures c. chattels d. fructus naturales.

c. chattels

Which of the following is an involuntary alienation of property? a. quitclaim b. inheritance c. condemnation d. gift

c. condemnation

The tenant leases a heated apartment during a bitterly cold winter, but soon after the tenant moves in, the landlord fails to provide heat because of a defective central heating unit. The tenant vacates the premises and refuses to pay any rent. This is an example of... a. abandonment b. actual eviction c. constructive eviction d. lessor negligence

c. constructive eviction

The tenant leases a heated apartment, but the landlord fails to provide heat because of a defective central heating plant. The tenant vacates the premises and refuses to pay any rent. This is an example of... a. abandonment b. actual eviction c. constructive eviction d. lessor negligence

c. constructive eviction

The covenant in a deed which states that the grantor is the owner and has the right to convey the title is called: a. covenant of further assurance b. covenant of warranty forever c. covenant of seisin d. covenant against encumbrances

c. covenant of seisin

A building is valued at $100,000 using a capitalization rate of 8%. If an investor demands a capitalization rate of 10%, the value of the building will... a. increase by 20%. b. increase by less than 20%. c. decrease more than $10,000. d. decrease less than $10,000.

c. decrease more than $10,000.

What is the function of a real estate appraisal? a. asset market value b. estimate market value c. determine market value d. establish the cost

c. determine market value

Real estate that is inherited from a person who died testate is referred to as a... a. legacy b. bequest c. devise d. demise

c. devise

Massachusetts General Laws Chapter 93A requires a real estate salesperson or broker to... a. refer all questions to the seller's attorney or seller. b. disclose positive information only. c. disclose all information material to the sale. d. disclose material information but only if asked.

c. disclose all information material to the sale.

To find the value of a property using the income approach to value, if the net operating income and the capitalization rate were known, the appraiser would... a. multiply the net operating income by the capitalization rate b. multiply the effective gross income by the capitalization rate c. divide the net operating income by the capitalization rate d. divide the capitalization rate by the net operating income

c. divide the net operating income by the capitalization rate

A tenant's tenancy for years will expire in two weeks. The tenant plans to move to a larger apartment across town when the current tenancy expires. In order to terminate this agreement, the tenant must... a. give the landlord immediate notice or the lease will automatically renew. b. give the landlord one week's prior notice or the lease will automatically renew. c. do nothing because the agreement will terminate automatically at the end of the current term. d. sign a lease for the new apartment, which will automatically terminate the existing lease.

c. do nothing because the agreement will terminate automatically at the end of the current term.

Agent B has a listing and shows it to Buyer M. Buyer M does not like the property because it does not have a garage. Agent B gives Buyer M several business cards and tells Buyer not to view or buy any property without Agent B. Buyer M goes to an open house hosted by Agent C and buys the property directly from Agent C. Agent B... a. is entitled to a commission. b. is a buyer's agent. c. does not have an agency relationship with Buyer M. d. is a subagent.

c. does not have an agency relationship with Buyer M.

If a married man willed all of his real estate to his sister and nothing to his wife, upon his death what rights would his wife have? a. none b. courtesy c. dower d. license

c. dower

A property on Main Street that was formerly a retail store will become the site of a new city hall, made possible by the government's power of... a. escheat b. possibility of reverter c. eminent domain d. taxation.

c. eminent domain

The purpose of building permits is to... a. generate revenue for the municipality b. control the activities of building inspectors c. ensure compliance with building codes d. prevent encroachments

c. ensure compliance with building codes

The purchaser's down payment is considered what type of funds... a. borrowed b. leverage c. equity d. capitol

c. equity

Which of the following would NOT be considered a freehold estate? a. fee simple estate b. life estate c. estate for the years d. defeasance fee estate

c. estate for the years

Under its police powers, a municipality may regulate all of the following about housing in a development EXCEPT... a. lot sizes b. building uses c. ethnicity of owners d. type of structure

c. ethnicity of owners

One of the methods a real estate investor may use to defer capital gains tax is to... a. sell the property for cash only. b. obtain the maximum amount of leverage c. exchange property for like-kind property d. build a reserve account for items likely to wear out

c. exchange property for like-kind property

A buyer has signed an agreement with a broker to compensate the broker even if the buyer purchases the property from a relative. This is called a(n)... a. open buyer agency agreement b. buyer agency agreement c. exclusive buyer agency agreement d. invalid agreement

c. exclusive buyer agency agreement

An agent who works with and not for the buyer or seller is a... a. general agent b. dual agent c. facilitator d. licensee

c. facilitator

All of the following would affect demand EXCEPT: a. Population b. Demographics c. Wage levels d. Monetary policy

d. Monetary policy

For a deed to be valid, it must be delivered to the... a. grantor b. Registry of Deeds c. grantee d. notary public

c. grantee

A homeowner may be allowed certain protection from judgments of creditors as a result of the state's... a. littoral rights b. curtesy rights c. homestead rights d. dower rights.

c. homestead rights

Under the statute of frauds, all contracts for the sale of real estate must be... a. originated by a real estate professional. b. on preprinted forms. c. in writing to be enforceable. d. accompanied by earnest money deposits.

c. in writing to be enforceable.

A group of investors is looking to buy a shopping mall to add to a portfolio of investment properties. Which of the following valuation methods would be most useful to them? a. comparative sales method b. asset based approach c. income approach d. cost approach

c. income approach

Sales associates who are paid in a lump sum and who are personally responsible for paying their own taxes are probably treated for tax purposes as... a. employees b. buyer's agents c. independent contractors d. transactional brokers

c. independent contractors

Upon discovering a latent defect in a property, Broker Alice should discuss the problem with seller Juan and then... a. tell him that the defect must be required. b. arrange for the repairs herself. c. inform any prospective buyers of the defect. d. contact the city building inspector about the defect.

c. inform any prospective buyers of the defect.

A broker is discussing a new listing with a prospective Mexican-American buyer. The buyer wants to inspect the property immediately, but the owner of said property has instructed the broker, in writing, not to show the house during the owner's three-week absence. The buyer insists on viewing the property. The broker should... a. show the property to avoid a violation of the Federal Fair Housing Act. b. request the Real Estate Commission arbitrate the problem. c. inform the buyer of the seller's instructions. d. notify the nearest HUD office.

c. inform the buyer of the seller's instructions.

An eligible veteran made a purchase offer of $180,000 on a home he wants to finance with a VA guaranteed loan. Four weeks after the offer was accepted, a certificate of reasonable value (CRV) for $177,000 was issued for the property. In this situation, the veteran could do all of the following EXCEPT... a. withdraw from the purchase without penalty b. purchase the property with a $3,000 cash down payment c. insist that the lender loan up the allowable maximum of the certificate of eligibility d. negotiate with the seller to reduce the price to $3,000

c. insist that the lender loan up the allowable maximum of the certificate of eligibility

An eligible veteran made a purchase offer of $180,000 on a home he wants to finance with a VA guaranteed loan. Four weeks after the offer was accepted, a certificate of reasonable value (CRV) for $177,000 was issued for the property. In this situation, the veteran could do all of the following except... a. withdraw from the purchase without penalty b. purchase the property with a $3,000 cash down payment c. insist that the lender loan up the allowable maximum of the certificate of eligibility d. negotiate with the seller to reduce the price to $3,000

c. insist that the lender loan up the allowable maximum of the certificate of eligibility

A person who has died without a will has died... a. testate b. in valid conveyance c. intestate d. under the acknowledgment clause

c. intestate

Title to real estate may be transferred during a person's lifetime by... a. devise b. descent c. involuntary alienation d. escheat.

c. involuntary alienation

A man owned two acres of land. He sold one acre to a neighbor and reserved for himself an appurtenant easement over his neighbor's land for ingress and egress. The man's land... a. is the servient tenement. b. can be cleared of the easement when the man sells the withheld acre to a third party. c. is the dominant tenement. d. is subject to an easement in gross.

c. is the dominant tenement.

Under which of the following types of liens can both the real property and the personal property of the debtor be sold to pay the debt? a. real estate tax lien b. mechanic's lien c. judgment lien d. assessment lien

c. judgment lien

In regulations regarding lead-based paints, HUD requires that... a. homeowners test for its presence. b. paint be removed from surfaces before selling. c. known lead-based paint hazards be disclosed. d. only homeowners deal with its removal.

c. known lead-based paint hazards be disclosed.

In regulations regarding lead-based paints, HUD requires that... a. homeowners test for its presence. b. paint must be removed from surfaces before selling. c. known paint hazards must be disclosed. d. only licensed contractors may deal with its removal.

c. known paint hazards must be disclosed.

TRID applies to the activities of... a. licensed real estate brokers when selling commercial and industrial properties. b. licensed securities salespeople when selling limited partnership interests. c. lenders financing the purchase of residential properties. d. Fannie Mae and Freddie Mac when purchasing residential mortgages.

c. lenders financing the purchase of residential properties.

Federal underground storage tank (UST) regulations require that... a. home fuel oil tanks in basements be registered with the EPA b. septic tanks be pumped every five years c. liquid petroleum tanks that store at least 10% of their volume underground be in compliance d. states not develop regulations more stringent than the federal requirements

c. liquid petroleum tanks that store at least 10% of their volume underground be in compliance

From the reproduction or replacement cost of a building, the appraiser deducts depreciation, which represents... a. the remaining economic life of the building. b. remodeling costs to increase rentals. c. loss of value due to any reason. d. costs to modernize the building.

c. loss of value due to any reason.

While the objective in the cost approach generally is to estimate the value of both land and improvements, the land typically is appraised using the... a. income approach b. gross rent multiplier approach c. market data approach d. option approach

c. market data approach

Tenancy by the entirety is a special form of ownership available only to... a. sole owners b. corporations c. married couples d. limited partners

c. married couples

A metes-and-bounds legal description... a. can be made only in areas excluded from the rectangular survey system. b. is not acceptable in court in most jurisdictions. c. must commence and finish at the same identifiable point. d. is used to complete areas omitted from recorded subdivision plats.

c. must commence and finish at the same identifiable point.

When an earnest money deposit is received, a broker... a. must give it to the seller. b. may deposit it in his account. c. must deposit it in an escrow account. d. must hold the check until the closing.

c. must deposit it in an escrow account.

A seller tells the agent that there is a crack in the foundation, but the insulation is covering it. The agent... a. does not have to tell the buyer b. must inform the seller it has to be repaired before listing the property c. must inform the buyer, even if the buyer does not ask about the foundation. d. does not have any responsibility concerning this issue.

c. must inform the buyer, even if the buyer does not ask about the foundation.

The amount of commission paid to a sales associate is determined by... a. state law b. the local real estate board c. mutual agreement with the broker d. mutual agreement with the client

c. mutual agreement with the broker

The lessor and lessee have agreed to a lease term of five years. In order to ensure that the rental income during the term is reflective of market conditions, the lessor could... a. negotiate a new lease each year. b. collect an additional security deposit each year. c. negotiate an index lease. d. negotiate a gross lease.

c. negotiate an index lease.

All of the following are characteristics of value EXCEPT... a. scarcity b. transferability c. obsolescence d. utility

c. obsolescence

Under an Exclusive-Right-to-Sell Listing agreement, if the seller produces a ready, willing, and able buyer he... a. will not have to pay a commission since he produced the buyer. b. will only have to pay the broker half the commission since he produced the buyer. c. owes the listing broker a full commission. d. will not be able to turn the buyer over to the listing agent since the agent has the exclusive right-to-sell the property.

c. owes the listing broker a full commission.

Mortgage lenders want assurance that future real estate taxes will be paid. The most common way to do this is to require the borrower to... a. obtain title insurance b. sign a note c. pay into an impound or escrow account d. submit paid tax receipts

c. pay into an impound or escrow account

A bill of sale is used to transfer the ownership of what? a. real property b. fixtures c. personal property d. appurtenances

c. personal property

A person who assumes an existing mortgage loan is... a. not personally liable for the repayment of the debt. b. not in danger of losing the property by default. c. personally responsible for paying the principal balance. d. generally released from liability, but not always.

c. personally responsible for paying the principal balance.

According to law, a trade fixture is usually treated as... a. realty. b. an easement. c. personalty. d. a license.

c. personalty

Wear and tear on a property would be an example of what type of obsolescence? a. economic b. functional c. physical d. scarcity

c. physical

To create a joint tenancy relationship in the ownership of real estate, there must be unities of: a. grantees, ownership, claim of right, and possession b. title, interest, encumbrance, and survivorship c. possession, time, interest, and title d. ownership, possession, heirs, and title

c. possession, time, interest, and title

To create joint tenancy in the ownership of real estate, there must be unities of... a. grantees, ownership, claim of right, and possession b. title, interest, encumbrance, and survivorship c. possession, time, interest, and title d. ownership, possession, heirs, and title

c. possession, time, interest, and title

Broker Casey was accused of violating antitrust laws. Of the following, she was MOST likely accused of... a. not having an equal housing opportunity sign in her office window b. undisclosed dual agencies c. price fixing d. dealing in unlicensed exchange services

c. price fixing

A broker was accused of violating antitrust laws. Of the following, the broker was MOST likely accused of... a. not having an equal housing opportunity sign in the office window b. undisclosed dual agency c. price-fixing d. dealing in unlicensed exchange services

c. price-fixing

When responsible for maintaining a client's property and maximizing return on the client's investment, a broker is serving as a(n)... a. rental agent. b. building maintenance specialist. c. property manager. d. investment counselor.

c. property manager.

The purpose of a building permit is to... a. indicate the property is suitable for habitation. b. maintain municipal control over the amount of building. c. provide evidence of compliance with municipal regulations. d. show compliance with restrictive covenants.

c. provide evidence of compliance with municipal regulations.

The 'Home Inspectors: Facts for Consumers' brochure must be presented to buyers by... a. home inspectors b. pest inspectors c. real estate agents d. mortgage officers

c. real estate agents

The process of applying all three appraisal approaches on the same property to determine value is called... a. summary b. comparison c. reconciliation d. assessment

c. reconciliation

A mechanic's lien claim arises when a contractor has performed work or provided material to improve a parcel of real estate on the owner's order and the work has not been paid for. Such a contractor has a right to... a. tear out the work. b. record a notice of the lien. c. record a notice of the lien and file a court suit within the time required by state law. d. have personal property of the owner sold to satisfy the lien.

c. record a notice of the lien and file a court suit within the time required by state law.

The illegal process of a banker refusing to approve loans for a neighborhood based on the racial composition of the area is: a. blockbusting b. steering c. redlining d. panic peddling

c. redlining

The Closing Disclosure must be used to illustrate all settlement charges for... a. every real estate transaction b. transactions financed by VA and FHA loans only c. residential transactions financed by federally related mortgage loans d. all transactions involving commercial property.

c. residential transactions financed by federally related mortgage loans

All of the following should be included in a management agreement EXCEPT... a. a description of the property. b. compensation. c. restrictions regarding ages of children. d. the extent of the manager's authority.

c. restrictions regarding ages of children.

A property owner's land is located along the banks of a river. This owner's water rights are called... a. littoral rights. b. prior appropriation rights. c. riparian rights. d. hereditaments.

c. riparian rights

One of the two, common nationwide water rights is... a. reflection rights b. marsh rights c. riparian rights d. siberian rights

c. riparian rights

Avoid, control, transfer, or retain are the four alternative techniques of... a. tenant relations b. acquiring insurance c. risk management d. property management

c. risk management

A corporation is a legal entity, recognized as an artificial person. Property owned solely by the corporation is owned in... a. trust b. partnership c. severalty d. survivorship tenancy.

c. severalty

The act of directing homeseekers toward or away from particular areas, either to maintain or to change the character of the neighborhood, is... a. blockbusting b. redlining c. steering d. permitted under the Fair Housing Act of 1968

c. steering

The LEAST specific method for identifying real property is... a. rectangular survey b. metes and bounds c. street address d. lot and block.

c. street address

Which of the following would terminate an agency relationship? a. abandonment by the agent b. revocation by the principal c. submission by the agent of two offers at the same time d. fulfillment of the agency purpose

c. submission by the agent of two offers at the same time

An existing mortgage loan can have its lien priority lowered through the use of a... a. hypothecation agreement b. satisfaction of mortgage c. subordination agreement d. reconveyance of mortgage

c. subordination agreement

When a tenant holds possession of a landlord's without a definite lease term but with the consent of the landlord, this is called... a. tenancy in common b. tenancy at sufferance c. tenancy at will d. trespass

c. tenancy at will

A buyer and a seller enter into a sales contract for the sale of a home. The seller changes his mind at the last minute, and the buyer suffers a financial loss of $1,500 and must rent a home in which to live. Unless the contract provides otherwise, all of these are legal actions that are likely to succeed EXCEPT... a. the buyer may sue the seller for specific performance, forcing the sale of the home to the buyer. b. the buyer may sue the seller for damages to recover the $1,500 loss. c. the seller is not liable because the buyer should not have incurred the $1,500 cost before the sale. d. the buyer may sue the seller for the rent he paid.

c. the seller is not liable because the buyer should not have incurred the $1,500 cost before the sale.

Your neighbors use your driveway to reach the garage on their property. Your attorney explains that the neighbors' real estate includes an easement appurtenant giving them the right to do this. Your property is... a. the leasehold interest b. the dominant tenement c. the servient tenement d. the license property

c. the servient tenement

A primary feature of property held in joint tenancy is that a. a maximum of two people can own the real estate b. the fractional interests of the owners can be different c. there is always right of survivorship d. additional owners may be added later

c. there is always right of survivorship

All of the following are true regarding public records EXCEPT... a. they give notice of encumbrances. b. they establish priority of liens. c. they guarantee marketable title. d. they provide constructive notice of interests in the identified property.

c. they guarantee marketable title.

A partition suit is used for which of the following? a. determination of party fences b. to allow construction of party walls c. to force a division of property without all the owners' consents d. to change a tenancy by entirety to some other form of ownership

c. to force a division of property without all the owners' consents

To assign a contract for the sale of real estate means to... a. record the contract with the county recorder's office b. permit another broker to act as agent for the principal c. transfer one's rights under the contract d. allow the seller and the buyer to exchange positions

c. transfer one's rights under the contract

Radon poses the greatest potential health risk to people when it is... a. contained in insulation material used in residential properties during the 1970s. b. found in high concentrations in unimproved land. c. trapped and concentrated in inadequately ventilated areas. d. emitted by malfunctioning or inadequately ventilated appliances.

c. trapped and concentrated in inadequately ventilated areas.

An oral contract for the sale of real estate is... a. illegal b. valid for property of low value c. unenforceable d. enforceable if notarized

c. unenforceable

The term nonhomogeneity refers to... a. scarcity b. immobility c. uniqueness d. indestructibility

c. uniqueness

A period of time over which an asset is expected to remain economically feasible to an owner is called its... a. salvage value b. cost basis c. useful life d. accelerated life

c. useful life

Mr. Rivera executed a deed to his nephew citing the consideration as $1.00. The deed is... a. voidable b. incomplete c. valid d. void

c. valid

A contract for the sale of real estate that does not state the consideration and provides no basis on which the consideration could be determined is considered... a. voidable b. executory c. void d. enforceable.

c. void

An agent working as a subagent of the seller would suggest that the buyer hire an inspector from an outside service in all of the following cases EXCEPT: a. when they smell gas in the basement b. when there is a slow drain in the toilet c. when a hinge is off the door d. when there is sawdust in the kitchen cabinets and in the unfinished attic

c. when a hinge is off the door

In order to satisfy the statute of frauds, a 14-month lease must be... a. written, acknowledged, and recorded b. written and recorded c. written d. recorded

c. written

Nationwide Multistate Licensing System Registry was created to register: a. Appraisers b. Property managers c. Home inspectors d. Mortgage loan originators

d. Mortgage loan originators

What is the annual real estate tax on a property valued at $135,000 and assessed for tax purposes at $47,250, with an equalization factor of 125%, when the tax rate is 25 mills? a. $945 b. $1,181 c. $1,418 d. $1,477

d. $1,477

A buyer offers $26,280 for a 20% share in a property. What is the total value of the property? a. $31,536 b. $32,850 c. $105,120 d. $131,400

d. $131,400

The Norris's sold their vacation home for $188,000. If they made a profit of 10%, what was the original cost of their property? a. $169,200 b. $179,000 c. $179,200 d. $170,909

d. $170,909

A broker sold a property that was owned by a bank that had acquired it through foreclosure, and the broker received a 6.5% commission. The broker gave the listing sales associate $3,575, which was 30% of the firm's commission. What was the selling price of the property? a. $55,000 b. $95,775 c. $152,580 d. $183,333

d. $183,333

An office rents for $450 per month and measures 12 feet by 20 feet. The advertised annual rent per square foot would be... a. $1.875 b. $4.50 c. $18.75 d. $22.50

d. $22.50

Two real estate professionals were found guilty of conspiring with each other to allocate real estate brokerage markets. A seller suffered an estimated $90,000 loss because of their activities. If the seller brings a civil suit against the two real estate professionals, what can the seller expect to recover? a. Nothing, because a civil suit cannot be brought for damages resulting from antitrust activities b. Only $90,000—the amount of actual damages the seller suffered c. Actual damages plus attorney's fees and costs d. $270,000 plus attorney's fees and costs

d. $270,000 plus attorney's fees and costs

A specific parcel of real estate has a market value of $160,000 and is assessed for tax purposes at 75% of market value. The tax rate for the county in which the property is located is 40 mills. The tax bill will be... a. $6,400 b. $5,000 c. $5,200 d. $4,800

d. $4,800

Appraiser Patrick appraised a property at $350,000, which reflected a 30% drop in value. What was the original purchase price of this property? a. $269,231 b. $245,000 c. $455,000 d. $500,000

d. $500,000

If a home is 44 feet long and is being built on a lot which has a 50-foot setback on each side, what frontage must that lot have? a. 1,232 square feet b. 44 feet c. 94 feet d. 150 feet

d. 150 feet

Margie listed her real estate for sale at $100,000. If her cost was 80% of the listing price, what will her percentage of profit be when her real estate is sold for the listing price? a. 10 percent b. 15 percent c. 20 percent d. 25 percent

d. 25 percent

An owner who is interested in selling a house is usually concerned about how much money the seller can get when it sells. A competitive market analysis may help the seller determine a realistic listing price. Which of the following is TRUE? a. A competitive market analysis is the same as an appraisal. b. A broker, not a salesperson, is permitted to prepare a competitive market analysis. c. A competitive market analysis is what is prepared by a certified real estate appraiser. d. A competitive market analysis contains a compilation of facts about similar properties that recently sold.

d. A competitive market analysis contains a compilation of facts about similar properties that recently sold.

All of the statements below are true, EXCEPT: a. A grant deed may convey "after acquired" title even when such warranty is not actually written into the contents of the deed b. A quitclaim deed may convey any right or title including fee simple title c. A deed is of no effect unless delivered d. A reconveyance deed is used to convey title to a new purchaser in connection with a "trust deed sale"

d. A reconveyance deed is used to convey title to a new purchaser in connection with a "trust deed sale"

Which clause would give a lender the right to have all future installments become due upon default? a. Escalation b. Defeasance c. Alienation d. Acceleration

d. Acceleration

Concerning business opportunities: a. The bulk sales law is contained in the Uniform Commercial Code b. A bill of sale is used to convey title to business items c. Sales tax is a tax on the sale of tangible personal property d. All are true statements

d. All are true statements

A lessee's interest is: a. Personal property b. A chattel real c. A grant to use property for a period of time which reverts to the grantor at the expiration of the term d. All of the above

d. All of the above

In portfolio risk management, a lender considers: a. Diversification b. Liquidity c. Reserves d. All of the above

d. All of the above

The right to foreclose a trust deed, under a trustee's power of sale, outlaws: a. In four years b. In three years c. In two years d. Never

d. Never

Doug and Darryl both die, leaving estates of well over $1 million each. Neither wrote a will. Doug's parents live in Argentina and haven't spoken to him since 1980. Darryl, who has no family members, left a note in a sealed envelope stating his wish that his property be given to a local animal shelter. How will the estates be divided? a. Both will escheat to Massachusetts. b. Doug's estate will go to his parents, and Darryl's will go to the shelter. c. Doug's estate will escheat to Massachusetts, and Darryl's will go to the shelter. d. Doug's estate will go to his parents, and Darryl's will escheat to Massachusetts.

d. Doug's estate will go to his parents, and Darryl's will escheat to Massachusetts.

In Massachusetts, when does a real estate salesperson's license expire? a. June 30 of every even-numbered year b. June 30 of every odd-numbered year c. December 31 of the third year of licensure d. Every two years on the salesperson's birthday

d. Every two years on the salesperson's birthday

A lease would be terminated by which of the following? a. Sale of the leased premises b. Death of the tenant c. Abandonment of the leased premises by the tenant d. Expiration of the term in a lease for years

d. Expiration of the term in a lease for years

Discrimination based on familial status was prohibited with the passage of the... a. Civil Rights Act of 1866 b. Civil Rights Act of 1964 c. Fair Housing Act of 1968 d. Fair Housing Amendments Act of 1988

d. Fair Housing Amendments Act of 1988

What type of federal law prohibits discrimination in the provision of housing and housing-related services (including lending) based on an individual's race, color, national origin, religion, sex, familial status, or disability? a. Licensing b. Lot size c. Home ownership d. Fair housing

d. Fair housing

A person wants to ensure that the ownership of real property can be willed to her children. Which form of ownership would the person want? a. Conventional life estate b. Joint tenancy c. License d. Fee simple estate

d. Fee simple estate

Damage from which of the following is NOT covered in a basic homeowners' policy? a. Fire and lightning b. Explosion c. Windstorm and hail d. Flood

d. Flood

All of the following are treated as personal property EXCEPT: a. Chattels b. Trade fixtures c. Emblements d. Fructus naturales

d. Fructus naturales

Which lien affects all real and personal property of a debtor? a. Specific b. Voluntary c. Involuntary d. General

d. General

Which factor primarily affects supply in the real estate market? a. Population b. Demographics c. Employment d. Governmental monetary policy

d. Governmental monetary policy

Chris is an on-site property manager for GreenPoint Apartments which includes negotiating leases for the apartments. Which of the following is true concerning an on-site manager? a. He is violating the license law b. He must have a broker's license c. He must have a salesperson's license d. He is exempt from the licensing requirements

d. He is exempt from the licensing requirements

Toni leases store space to Ken for a restaurant, and Ken installs his ovens, booth, counters, and other equipment. When would these items become real property? a. After they are installed b. After Ken defaults on his rental payments c. After the lease takes effect d. If Ken does not remove them at lease expiration

d. If Ken does not remove them at lease expiration

A buyer and a seller agree on a purchase price of $300,000 for a house. The contract contains a clause stating that "time is of the essence." Which statement is TRUE? a. The closing must take place within a reasonable period before the stated date. b. A "time is of the essence" clause is not binding on either party. c. The closing date must be stated as a particular calendar date, and not simply as a formula, such as "two weeks after loan approval." d. If the closing date passes and no closing takes place, the contract may be rescinded by the party who was ready to settle on the scheduled date.

d. If the closing date passes and no closing takes place, the contract may be rescinded by the party who was ready to settle on the scheduled date.

18. A tenant signs a lease that includes the following clause: "The stated rent under this agreement will be increased or decreased every three months based on the percentage change in the consumer price index (CPI) for that period." What kind of lease has this tenant signed? a. Percentage b. Net c. Graduated d. Index

d. Index

Why is the Civil Rights Act of 1866 unique? a. It has been broadened to protect the aged. b. It adds welfare recipients as a protected class. c. It contains "choose your neighbor" provisions. d. It provides no exceptions that would permit racial discrimination.

d. It provides no exceptions that would permit racial discrimination.

The four unities of possession, interest, time, and title are associated with which of the following? a. Community property b. Severalty ownership c. Tenants in common d. Joint tenancy

d. Joint tenancy

A buyer purchased a parcel of real estate. Title has passed, but to date the buyer has not paid the purchase price in full, as originally agreed. If the seller wants to force payment, which remedy is the seller entitled to seek? a. Attachment b. Mechanic's lien c. Lis pendens d. Judgment

d. Judgment

A buyer and a seller enter into a real estate sales contract. Under the contract's terms, the buyer will pay the seller $500 a month for 10 years. The seller will continue to hold legal title, while the buyer will live in the home and pay all real estate taxes, insurance premiums, and regular upkeep costs. What kind of contract do the buyer and seller have? a. Option contract b. Contract for mortgage c. Unilateral contract d. Land sales contract

d. Land sales contract

A general contractor recently filed suit against a homeowner for nonpayment. The contractor now learns that the homeowner has listed the property for sale with a real estate professional. In this situation, which of the following will the contractor's attorney use to protect the contractor's interest? a. Seller's lien b. Buyer's lien c. Assessment d. Lis pendens

d. Lis pendens

Buyers met an agent at an open house. In order to buy the listed property, the buyers needed to sell their house. The agent wrote an offer to purchase with the following terms. "Purchasers shall list purchasers property at 567 Main Street, Your Town, Your State with XYZ Realty within 24 hours of the acceptance of this offer, or this offer shall become null and void and the earnest money shall be refunded to the purchaser." Is this legal? a. Yes, this is exactly what the agent should do to secure the listing. b. Yes, if state law allows it. c. No, it is a violation of Regulation Z. d. No, it is a violation of the Sherman Antitrust Act.

d. No, it is a violation of the Sherman Antitrust Act.

A landlord owns property where young children (younger than age six) live. He is aware that the apartments have lead paint and has enacted interim controls from a licensed inspector. If the landlord is sued by a tenant, how would the court find him? a. Strictly liable b. Negligent c. Grossly negligent d. None of the above

d. None of the above

A real estate broker is usually: a. A fiduciary to a person interested in buying a property the broker has listed b. An attorney-in-fact c. An agent serving the principal under a duly executed power-of-attorney d. None of the above

d. None of the above

Real property would include... a. Real property tax lien b. Trust deed c. Crude oil which has just reached the surface in a pipe drilled beneath the land d. None of the above are real property

d. None of the above are real property

Which of the following is TRUE about a comparative market analysis? a. It is made by a professional appraiser. b. It is the same as an appraisal. c. It is based on a detailed market analysis of market conditions, property features, recent sales and listings, land value, and construction costs. d. None of these.

d. None of these.

A buyer of a residence, prior to the close of escrow, asks the broker for permission to move into the property. The broker should: a. Deny the buyer permission b. Grant the buyer oral permission c. Ask the buyer to sign a lease for the property d. Obtain written consent from the owner

d. Obtain written consent from the owner

Littoral rights would be of interest to someone living in which of the following situations? a. On the bank of a river b. On the side of a hill c. On the edge of a forest d. On an ocean beach

d. On an ocean beach

The broker's authority under a listing includes... a. Everything necessary to conclude a sale b. The customary duty of a general agent c. Any act performed in the owner's best interest d. Only the authority granted or implied

d. Only the authority granted or implied

Which of the following is considered personal property? a. Wood-burning fireplace b. Built-in microwave c. Bathtub d. Patio furniture

d. Patio furniture

Which of the following is not a necessary element in the formation of a contract: a. Offer b. Acceptance c. Consideration d. Performance

d. Performance

Which of the following items would usually NOT be shown on the plat map for a new subdivision? a. Easements for sewer and water main b. Land to be used for streets c. Numbered lots and blocks d. Prices of residential and commercial lots

d. Prices of residential and commercial lots

A homeowner constructs a five-bedroom brick house with an indoor pool in a neighborhood of modest two-bedroom and three-bedroom frame houses on narrow lots. The value of this house is MOST likely to be affected by what principle? a. Progression b. Assemblage c. Change d. Regression

d. Regression

What is the source of the rules that govern the use of real estate advertisements in all media, if they include mortgage financing terms? a. Equal Credit Opportunity Act b. Fair Lending Act c. Community Reinvestment Act d. Regulation Z of the Truth in Lending Act

d. Regulation Z of the Truth in Lending Act

Which of the following is NOT a prohibited landlord action? a. Renting dangerous property b. Failing to comply with housing codes c. Failing to reimburse a tenant for authorized repairs d. Requires an amount equal to three months' rent at the time the lease commences

d. Requires an amount equal to three months' rent at the time the lease commences

The mortgagee foreclosed on a property after the borrower defaulted on the loan payments. The unpaid balance of the loan at the time of the foreclosure sale was $140,000, but at the foreclosure sale, the house sold for only $129,000. If permitted by state law, what must the lender do to recover the $11,000 the borrower still owes? a. Sue for damages b. Sue for specific performance c. Seek a judgment by default d. Seek a deficiency judgment

d. Seek a deficiency judgment

Which of the following refers to ownership by one person? a. Tenancy by the entirety b. Community property c. Tenancy in common d. Severalty

d. Severalty

After a foreclosure sale, the borrower who has defaulted on the loan may seek to pay off the mortgage debt plus any accrued interest and costs under what right? a. Equitable redemption b. Defeasance c. Usury d. Statutory redemption

d. Statutory redemption

The MOST common source of harmful lead in older residential properties is... a. asbestos b. basements c. appliances d. alkyd oil-based paint

d. alkyd oil-based paint

In receiving a gift of a parcel of real estate, one of the two new owners was given an undivided 60% interest and the other received an undivided 40%. They now hold their interests as... a. Cooperative owners b. Joint tenants c. Community property owners d. Tenants in common

d. Tenants in common

The following ad appeared in the newspaper: "For sale: 4 BR brick home; Redwood School District; excellent Elm Street location; short walk to St. John's Church; and right on the bus line. Move-in condition; priced to sell." Which statement is TRUE? a. The ad describes the property for sale and is very appropriate. b. The fair housing laws do not apply to newspaper advertising. c. The ad should state that the property is available to families with children. d. The ad should not mention St. John's Church.

d. The ad should not mention St. John's Church.

Which of the following is TRUE about VA-guaranteed mortgages? a. Discount points must be paid by the seller b. The borrower may have a prepayment penalty clause in the loan c. Funding fee amounts are negotiable d. The borrower must apply for a certificate of eligibility

d. The borrower must apply for a certificate of eligibility

Which of the following is TRUE about VA-guaranteed mortgages? a. Discount points must be paid by the seller b. The borrower may have a prepayment penalty clause in the loan c. Funding fee amounts are negotiable d. The borrower must apply for a certificate of eligibility.

d. The borrower must apply for a certificate of eligibility.

A broker tells a buyer, "This home has the most beautiful river view." In fact, the view includes the river and the back of a shopping center. Which is TRUE? a. The broker has committed fraud. b. The broker is guilty of negligent misrepresentation. c. The broker is guilty of intentional misrepresentation. d. The broker is merely puffing.

d. The broker is merely puffing.

A broker has established the following office policy: "All listings taken by any sales associate of this real estate brokerage must include compensation based on a 7% commission. No lower commission rate is acceptable." If the broker attempts to impose this uniform commission requirement, which statement is TRUE? a. A homeowner may sue the broker for violating the antitrust law's prohibition against price-fixing. b. The sales associates of the brokerage will not be bound by the requirement and may negotiate any commission rate they choose. c. The broker must present the uniform commission policy to the local professional association for approval. d. The broker may, as a matter of office policy, legally set the minimum commission rate acceptable for the firm

d. The broker may, as a matter of office policy, legally set the minimum commission rate acceptable for the firm

For the transfer of title to be valid, which of the following requirements does NOT necessarily apply? a. There must be a written document b. Language equivalent to the word grant must be used c. The purchase price must be mentioned d. The deed must be recorded at the Registry of Deeds

d. The deed must be recorded at the Registry of Deeds

Which of the following is the BEST definition of actual eviction? a. The right of a landlord to use the rental premises. b.The enforcement of a court order to remove a lessor. c. The landlord's reversionary right in the rental premises. d. The enforcement of a court order to remove a lessee.

d. The enforcement of a court order to remove a lessee.

Which of the following statements is FALSE regarding the homestead right? a. The amount of the mortgage is exempt from the debt. b. The home must be the principal residence of the family. c. The homeowner, surviving spouse, and minor children have a life estate. d. The homestead right does not have to be recorded.

d. The homestead right does not have to be recorded.

Which of the following is TRUE of condominium ownership? a. It cannot be mortgaged b. The corporation pays the real estate taxes c. The ownership cannot be willed d. The limited common elements cannot be sold separately

d. The limited common elements cannot be sold separately

Which statement is TRUE of real estate closings in most states? a. Closings are generally conducted by real estate professionals. b. The buyer usually receives the rent for the day of closing. c. The buyer must reimburse the seller for any title evidence provided by the seller. d. The seller usually pays the expenses for the day of closing.

d. The seller usually pays the expenses for the day of closing.

The landlord's lease prohibits tenants from altering the property in any way. A young woman who uses a wheelchair cannot maneuver over the doorstep into her apartment by herself. In addition, she cannot access the bathroom facilities in her wheelchair. Which of the following is TRUE? a. The landlord is responsible for making all apartments accessible to people with disabilities. b. The tenant cannot remedy these conditions because of the terms of the lease. c. The landlord should not have rented this apartment to the tenant. d. The tenant is entitled to make the necessary alterations.

d. The tenant is entitled to make the necessary alterations.

What do urea-formaldehyde foam insulation (UFFI), lead-based paint, and asbestos have in common? a. They all pose a risk to humans because they may emit harmful gases. b. They all were banned in 1978. c. All three were used in insulating materials. d. They were all used at one time in residential construction.

d. They were all used at one time in residential construction.

In one state, a mortgagee holds legal title to real property offered as collateral for a loan, and the mortgagor retains the rights of possession and use. If the borrower defaults, the lender is entitled to immediate possession and rents. This state can be BEST characterized as what kind of state? a.Lien theory b. Mortgage theory c. Intermediate theory d. Title theory

d. Title theory

A buyer and a seller sign a contract to purchase. The seller backs out, and the buyer sues for specific performance. What is the buyer seeking in this lawsuit? a. Money damages b. New contract c. Deficiency judgment d. Transfer of the property

d. Transfer of the property

Which of the following requires that all advertising that references mortgage financing terms contain certain disclosures? a. Equal Credit Opportunity Act b. Fair Housing Act c. Community Reinvestment Act d. Truth in Lending Act (Regulation Z)

d. Truth in Lending Act (Regulation Z)

The federal law that makes contracts originated, negotiated, and executed over a combination of computer and cell phone enforceable is... a. CAN-SPAM b. Junk Fax Prevention Act c. COPPA d. UETA

d. UETA

Title to real estate can be transferred upon death by what type of document? a. Warranty deed b. Special warranty deed c. Quitclaim deed d. Will

d. Will

The Rose family owns a home in a semi-rural area, which is about five-years-old. Recently announced plans for a new regional airport will place their home directly in line with a main runway ending 1 mile before their home. If the airport is constructed, will this diminish the value of the Rose home? a. Yes, because of functional obsolescence b. No, because noise from aircraft passing overhead is not recognized as affecting property values c. No, because value would increase due to the location close to the airport d. Yes, because of economic obsolescence

d. Yes, because of economic obsolescence

All of the following are prohibited under the antitrust laws EXCEPT... a. competing property management companies' agreeing to standardized management fees. b. competing brokers allocating markets based on the value of homes. c. real estate companies agreeing NOT to cooperate with a broker because of the fees that broker charges. d. a broker setting a company commission schedule.

d. a broker setting a company commission schedule.

A person has permission from a property owner to hike on the owner's property during the autumn months. The hiker has... a. an easement by necessity b. an easement by condemnation c. riparian rights d. a license

d. a license

A real estate sales associate, classified by the IRS as an independent contractor, receives... a. a monthly salary or hourly wage b. company-provided health insurance c. a company-provided automobile d. a negotiated share of commissions on transactions

d. a negotiated share of commissions on transactions

All of the following are types of buyer agency agreements EXCEPT... a. an exclusive buyer agency agreement. b. an exclusive-agency buyer agency agreement. c. an open buyer agency agreement. d. a net buyer agency agreement.

d. a net buyer agency agreement.

Under a brokerage agreement with a property owner, the broker is entitled to sell the property for any price, as long as the seller receives $85,000. The broker may keep any amount over $85,000 as a commission. This type of listing might be illegal and is called... a. an exclusive right-to-sell listing. b. an exclusive agency listing. c. an open listing. d. a net listing.

d. a net listing.

Under a percentage lease, a commercial lessee may agree to pay... a. maintenance b. real estate taxes c.insurance d. a percent of the sales

d. a percent of the sales

All of the following are different types of compensation from which a property management firm may receive income EXCEPT... a. a fixed fee. b. a percentage of the net rentals collected. c. a fixed fee with a percentage on new rentals. d. a percentage of purchases made from suppliers.

d. a percentage of purchases made from suppliers.

All of the following would be acceptable as evidence of marketable title EXCEPT... a. a Torrens certificate b. a title insurance policy c. an abstract and legal opinion d. a property owner's warranty deed

d. a property owner's warranty deed

The buyers purchased a residence for $395,000, making a down payment of $79,000 and obtaining a loan for the balance. The loan is... a. a nonconforming loan b. a package mortgage c. a balloon note d. a purchase money mortgage

d. a purchase money mortgage

What type of mortgage is a form of financing in which the buyer makes a down payment and the seller finances the balance? a. a wraparound mortgage b. a closed mortgage c. an open-end mortgage d. a purchase money mortgage

d. a purchase money mortgage

A REALTOR® is BEST described as an individual who is... a. a real estate professional who acts as a point of contact between two or more people in negotiating the sale, purchase, or rental of property. b. any real estate professional who assists buyers, sellers, landlords, or tenants in any real estate transaction. c. a member of the National Association of Real Estate Brokers who specializes in residential properties. d. a real estate licensee and a member of the National Association of REALTORS® (NAR).

d. a real estate licensee and a member of the National Association of REALTORS® (NAR).

When a mortgage has been paid in full, it is important for the borrower to be sure that... a. the paid note is placed in a safe deposit box. b. the borrower obtains a deed of partial reconveyance. c. the paid mortgage is returned to the lender. d. a satisfaction of mortgage is recorded.

d. a satisfaction of mortgage is recorded.

When a mortgage loan has been paid in full, it is important for the borrower to be sure that... a. the paid note is placed in a safe deposit box. b. they obtain a deed of partial reconveyance. c. the paid mortgage is returned to the lender. d. a satisfaction of mortgage is recorded.

d. a satisfaction of mortgage is recorded.

A tenancy in which the tenant continues in possession after the lease has expired, without the landlord's permission, is... a. a tenancy for years b. a periodic tenancy c. a tenancy at will d. a tenancy at sufferance

d. a tenancy at sufferance

For appraisal purposes, accrued depreciation is NOT caused by... a. functional obsolescence b. physical deterioration c. external obsolescence d. accelerated depreciation

d. accelerated depreciation

Homeowner Ed acquired ownership of land that was deposited by a river running through his property by... a. reliction b. succession c. avulsion d. accretion

d. accretion

When a prospective buyer makes a written purchase offer that the seller accepts, then the... a. buyer may take possession of the real estate. b. seller grants the buyer possessory rights. c. buyer receives legal title to the property. d. buyer receives equitable title to the property.

d. buyer receives equitable title to the property.

A property with encumbrances that will outlast the closing... a. cannot be sold. b. can be sold only if title insurance is provided. c. cannot have a deed recorded without a survey. d. can be sold if a buyer agrees to take it subject to the encumbrances.

d. can be sold if a buyer agrees to take it subject to the encumbrances.

The memorandum required by the statue of frauds includes all the following EXCEPT... a. description of the premises b. identity of the parties and their signatures c. consideration d. closing date

d. closing date

A person lives in an apartment building. The land and structures are owned by a corporation, with one mortgage loan securing the entire property. Like the other residents, this person owns stock in the corporation and has a lease to the apartment. This type of ownership is called... a. condominium b. planned unit development c. time-share d. cooperative

d. cooperative

At closing, an item prepaid by the seller is... a. debited to the seller b. evenly divided between the buyer and the seller c. credited to the buyer d. credited to the seller

d. credited to the seller

All of the following factors would be important in comparing properties under the sales comparison approach to value EXCEPT... a. differences in dates of sale. b. differences in financing terms. c. differences in appearance and condition. d. differences in original cost.

d. differences in original cost.

In Massachusetts, an amortized mortgage loan is called a... a. straight loan b. traditional mortgage c. direct reduction mortgage d. direct reduction loan

d. direct reduction loan

The holder of a life estate may do all of the following EXCEPT... a. pay the property taxes and special assessments b. maintain the property c. mortgage the life interest d. direct the disposition of the property at the end of the measuring life

d. direct the disposition of the property at the end of the measuring life

The Federal Fair Housing Act does NOT prohibit... a. blockbusting b. discriminatory advertising c. redlining d. discriminating on the basis of marital status

d. discriminating on the basis of marital status

The federal Fair Housing Act does NOT prohibit a. blockbusting b. discriminatory advertising c. redlining d. discriminating on the basis of marital status

d. discriminating on the basis of marital status

The Federal Fair Housing Act of 1968 prohibits... a. blockbusting b. steering c. redlining d. discrimination based on race

d. discrimination based on race

If a large manufacturing plant was allowed to construct a new plant near a new subdivision, the depreciation for the subdivision would be considered... a. substitution b. physical c. functional d. economic

d. economic

The period of time over which an improvement to the property will remain useful for its original purpose is known as its... a. amortized life b. chronological life c. actual life d. economic life

d. economic life

Condemnation of private property for public use is exercised under which government right? a. taxation b. escheat c. manifest destiny d. eminent domain

d. eminent domain

The purpose of the Real Estate Settlement Procedures Act (RESPA) is to... a. make sure buyers do not borrow more than they can repay. b. make real estate professionals more responsive to buyers' needs. c. help buyers know how much money is required. d. ensure that buyers know all settlement costs that will be charged to them.

d. ensure that buyers know all settlement costs that will be charged to them.

Under the covenant of quiet enjoyment, a grantor... a. promises to obtain and deliver any instrument needed to make the title good. b. warrants that the property is free from liens and encumbrances. c. warrants that he or she is the owner and has the right to convey title to the property. d. ensures that the title will be good against the title claims of third parties.

d. ensures that the title will be good against the title claims of third parties.

Asbestos, sick building syndrome (SBS), and lead-based paint are all examples of... a. issues beyond the scope of a property manager's job description. b. problems found only in newly constructed properties. c. issues that arise under the Americans with Disabilities Act (ADA). d. environmental concerns that a property manager may have to address.

d. environmental concerns that a property manager may have to address.

That portion of the value of owners' property that exceeds the amount of their mortgage debt is called... a. equality b. escrow c. surplus d. equity

d. equity

What type of a listing agreement allows the owner to appoint an exclusive agent to sell his property, but retains the right to sell the property himself? a. open b. exclusive right to sell c. multiple listing d. exclusive agency

d. exclusive agency

An example of an estate in real property is... a. joint tenancy b. community property c. tenants in common d. fee simple

d. fee simple

The largest estate or ownership in real property is a(n)... a. estate in sufferance b. estate at will c. life estates d. fee simple estate

d. fee simple estate

A real estate loan payable in periodic statements, sufficient to pay the principal in full during the term of the loan is called... a. conventional loan b. straight loan c. partially amortized loan d. fully amortized loan

d. fully amortized loan

A deed states that the grantors are conveying all their rights and interests to the grantees to have and to hold. This is communicated in the... a. acknowledgement clause b. restriction clause c. covenant of seisin d. habendum clause

d. habendum clause

The purchaser of real estate under an installment contract... a. generally pays no interest charge. b. receives title immediately. c. is not required to pay property taxes for the duration of the contract. d. has only an equitable interest in the property's title.

d. has only an equitable interest in the property's title.

Janet Jones, a sales agent, placed an advertisement in the newspaper. She advertised her name, her office address, her telephone number, and her educational background. What was one important item she was missing? a. the area she services b. her areas of specialty c. her experience d. her broker's and agency's name

d. her broker's and agency's name

A real estate broker uses earnest money placed in the company trust account to pay for the rent owed on the brokerage's office. Using escrow funds for this purpose is... a. illegal, unless the client has approved the expenditure. b. legal if the trust account is reimbursed by the end of the calendar month. c. legal if the seller gives consent in writing. d. illegal.

d. illegal

The practice of channeling families with children away from other buildings into an apartment building where other families with children reside is... a. most practical b. blockbusting c. redlining d. illegal

d. illegal

CERCLA regulations for administration of the Superfund, which helps pay for cleanup of uncontrolled hazardous waste sites, ... a. exempt from responsibility those sites that contaminate neighboring properties. b. release from liability those owners of contaminated property who did not actually cause known contamination. c. make no provision for recovering Superfund expenses incurred in cleanup operations. d. impose strict, joint and several, and retroactive liability on potentially responsible parties.

d. impose strict, joint and several, and retroactive liability on potentially responsible parties.

The statute of frauds requires that real estate contracts be a. recorded at the courthouse. b. no longer than 10 pages. c. verbal to be enforceable. d. in writing to be enforceable.

d. in writing to be enforceable.

The law of descent and distribution applies when a person dies... a. testate b. leaving no heirs c. leaving minor children d. intestate

d. intestate

Larry owns property next to property that the city has condemned to extend the runways at the municipal airport. Larry feels his property has diminished in value due to this public use. He may seek compensation by an action of... a. taking b. condemnation c. confiscation d. inverse condemnation

d. inverse condemnation

Eminent domain and escheat are two examples of... a. voluntary alienation b. adverse possession c. transfers of title by descent d. involuntary alienation

d. involuntary alienation

A tenant has an estate for years. According to the written one-year lease, the tenancy will expire on May 1. To obtain possession as of that date, the landlord... a. must give the tenant 30 days' notice. b. must give the tenant 60 days' notice. c. must give the tenant notice before April 15. d. is not required to give the tenant any notice.

d. is not required to give the tenant any notice.

Successful property manages do all of the following EXCEPT... a. screen the tenants' ability to pay and their space needs. b. study rental rates in the area to get the best possible sense of supply and demand. c. consider the type of business the tenant has and how it will fit businesses already on the property. d. keep on good terms with tenants by overlooking infractions of building rules.

d. keep on good terms with tenants by overlooking infractions of building rules.

When one has permission to use land but has no other rights, one has a... a. tenancy in common b. leasehold estate c. tenancy in sufferance d. license

d. license

Freehold estate includes: a. estate for years b. leasehold estates c. periodic tenancy d. life estates

d. life estates

When a company furnishes materials for the construction of a house and is subsequently not paid, it may file a(n) a. deficiency judgment. b. lis pendens. c. estoppel certificate. d. mechanic's lien.

d. mechanic's lien

When a company furnishes materials for the construction of a house and is subsequently not paid, it may file a(n)... a. deficiency judgment b. lis pendens c. estoppel certificate d. mechanic's lien

d. mechanic's lien

When a company furnishes materials for the construction of a house and is subsequently not paid, it may file a(n)... a. deficiency judgment. b. lis pendens. c. estoppel certificate. d. mechanic's lien.

d. mechanic's lien.

A property description in a deed mentions point of beginning. What method was the description based on... a. surveyors method b. lot and block c. government survey d. metes and bounds

d. metes and bounds

A Savings & Loan institution would be violating the Federal Fair Housing Act by denying a loan to Mr. and Mrs. Brown for which of the following reasons? a. low earnings b. too many loans c. too old d. minority background

d. minority background

A real estate salesperson, classified by the IRS as an independent contractor, receives... a. a monthly salary or hourly wage. b. company-provided health insurance. c. company-provided automobile. d. negotiated commissions on transactions.

d. negotiated commissions on transactions.

Broker Ed enters into a listing agreement with a seller under which the seller will receive $22,000 from the sale of a lot and the broker will receive any sale proceeds over this amount. This type of listing is a(n)... a. gross listing b. legal and ethical way to ensure that the broker is compensated c. exclusive agency d. net listing

d. net listing

On Monday, the seller offers to sell his vacant lot to the buyer for $42,000. On Tuesday, the buyer counteroffers to buy for $40,500. On Friday, the buyer learns that several other prospects may be making offers on the property, so he withdraws the counteroffer and agrees to the original asking price of $42,000. Under these conditions, there is... a. a valid agreement because the buyer accepted the seller's offer exactly as it was made. b. a valid agreement because the buyer accepted before the seller advised the buyer that the offer is withdrawn. c. not a valid agreement because the seller's offer was not accepted within 72 hours. d. not a valid agreement because the buyer's counteroffer was a rejection of the seller's offer.

d. not a valid agreement because the buyer's counteroffer was a rejection of the seller's offer.

The municipality permit that allows habitation of a property is a/an... a. building permit b. deed c. lease d. occupancy permit

d. occupancy permit

Under TRID when must the loan estimate be given to the borrower? a. when the buyer asks for it b. 3 days prior to closing c. when the loan officer completes review of the application d. placed in the mail or delivered no later than the third business day after receiving the application

d. placed in the mail or delivered no later than the third business day after receiving the application

All of the following are important functions of a property manager EXCEPT... a. supervising the maintenance of the property. b. protecting the physical integrity of the property. c. meeting the functional requirements of the tenants. d. preparing the owner's income tax returns.

d. preparing the owner's income tax returns.

The type of deed where the grantor conveys interest that he has in property but does not give word regarding warranty of said property is known as... a. special warranty deed b. surety bonding deed c. sheriff's deed d. quit claim deed

d. quit claim deed

A mechanic's lien would be available to all of the following EXCEPT... a. subcontractors b. contractors c. surveyors d. real estate professionals

d. real estate professionals

Actions that are made illegal by federal and state fair housing laws do NOT include... a. offering advantageous loan terms to encourage the integration of a residential area. b. refusing to show certain residential property to non-English-speaking individuals. c. channeling members of a certain minority group into an area already predominately occupied by members of that minority. d. refusing to show certain residential property to people who are not financially qualified to purchase it.

d. refusing to show certain residential property to people who are not financially qualified to purchase it.

The gross rent multiplier is used as a guideline for estimating value based on the... a. ratio of the gross rents to the net rents after expenses b. proportion of rents due to the actual rents collected c. capitalization of the annual gross rental income d. relationship of sales prices to the rental income

d. relationship of sales prices to the rental income

All of the following will terminate an easement EXCEPT... a. when the need no longer exists b. nonuse of a prescriptive easement c. abandonment of easement d. release of the right of easement to the dominant tenement

d. release of the right of easement to the dominant tenement

If, upon the receipt of an offer to purchase his property under certain conditions, the seller makes a counteroffer, the prospective buyer is: a. bound by his original offer b. bound to accept the counteroffer c. bound by whichever offer is lower d. relieved of his original offer

d. relieved of his original offer

If, upon the receipt of an offer to purchase a property, the seller makes a counteroffer, the prospective buyer is... a. bound by the original offer b. not able to counter the counteroffer c. bound by whichever offer is lower d. relieved of the original offer

d. relieved of the original offer

If, upon the receipt of an offer to purchase property subject to certain conditions, the seller makes a counteroffer, the prospective buyer is... a. bound by the original offer b. bound to accept the counteroffer c. bound by whichever offer is lower d. relived of the original offer

d. relived of the original offer

Zoning ordinances normally define specific uses for land that are permitted within a municipality. All of the following are designated uses in such ordinances EXCEPT: a. industrial b. commercial c. residential d. rental

d. rental

An easement appurtenant... a. terminates with the sale of the property b. is a right-of-way for a utility company c. is revocable d. runs with the land

d. runs with the land

In a buyer brokerage situation, who pays the salespersons commission? a. buyer only b. seller only c. buyer and seller d. salesperson's broker

d. salesperson's broker

Peter leases store space to Kim for a restaurant, and Kim installs ovens, booths, counters, and other equipment. When do these items become real property? a. when they are installed b. when Kim defaults on her rental payments c. when the lease takes effect d. when the lease expires, if the items are not taken by the tenant

d. when the lease expires, if the items are not taken by the tenant