Exam Info

. 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 purchaser's 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. 9. D - The Sherman Antitrust Act does not allow tying (tie-in) agreements. To "tie" an offer to a listing agreement is not allowed.

11. A person died testate. After an extensive search, no additional heirs were found. The person's real property would transfer by A. escheat to the state. B. by descent and distribution. C. by demise. D. by devise. 11. D - When a person dies testate, it means the person died with a will. Real property is devised or transferred by the will. If a person dies intestate, or without a will, the laws of descent and distribution are followed. Demise is to give up the right of possession in a lease. (Yes, it also means someone has died.) Escheat means the property reverts to the state when it is classified as abandoned. This may happen when someone dies intestate and no heirs can be found.

14. If state law permits, the unities of time, title, interest, possession and person would be created when A. John, Peggy and George buy a cottage on the lake. B. Mr. and Mrs. Jones buy real estate. C. a corporation purchases investment property. D. Carrie buys her first house. 14. B - The unities of time, title, interest, possession and person are found in tenancy by the entireties, when two people are married to each other. Joint tenancy only has the unities of time, title, interest and possession.

16. The S1/2 of the NE1/4 and the NW1/4 of the SE1/4 would contain A. 2,344,560 square feet. B. 3,484,800 square feet. C. 4,395,340 square feet. D. 5,277,200 square feet. 16. D - 640 ÷ 4 ÷ 2 = 80 640 ÷ 4 ÷ 4 = 40 120 acres x 43,560 = 5,227,200 square feet

17. In 1969 Carmel purchased a condo for $15,000. Today she sold the property for $85,000 and agreed to finance the loan for the buyer. This transaction is known as a/an A. conventional loan. B. unconventional loan. C. land contract. D. blanket mortgage. 17. C - A land contract is also known as an installment sale. The seller agrees to finance the property in a land contract.

22. A habendum clause would be found in a/an A. mortgage. B. note. C. deed. D. sales contract. 22. C - The habendum clause is found in a deed. The seller is transferring the rights to the new owner "to have and to hold." It is sometimes called the granting clause.

24. An agent received a thank you note from a lender for the referral of a buyer. The note included a $35 gift card to a local restaurant. The law that makes this kickback illegal is A. Regulation Z B. RESPA C. CRA D. ECOA 24. B - The Real Estate Settlement Procedures Act (RESPA) prohibits kickbacks from service providers.

25. The sale price of the property is $150,000 and borrower has a 20% down payment. The mortgage rate chart indicates that the monthly payment on a 30 year loan at 4% is 4.775 per $1,000. How much is the monthly payment? A. $716.25 B. $644.63 C. $573.00 D. $480.00 25. C $150,000 x .80 = $120,000 Loan $120,000 divided by $1,000 = 120 120 x 4.775 = $573 Monthly P and I payment

4 Ways to create a Lien V.I.S.E. V - voluntary (eg taking a mortgage) I - Involuntary (not a matter of choice) S - Statutory (e.g. real estate tax) E - Equitable (common-law, charge card etc)

3 Forms of Estate Ownership 1 - Severalty (sole owner/indiv or corp) 2 - co-ownership (2 or more people) 3 - Intrust (neutral individual holding for benefit of another)

4 Economic Characteristics of real estate - scarcity (land is not limitless) - improvements (can affect values of neighbors, e.g. new mall, toxic waste dump) - permanence of investment (longterm & relatively stable) - area preference (location, location, location)

9 Types of Housing: 1 - single family home 2 - apartment complex 3 - condominiums 4 - cooperatives (own stake/sock in the building, not the units) 5 - Planned Unit Developments (PUDs, communities w/markets, post office etc, Celebration inFLA) 6 - Mixed-Use Developements (MUDs - housing & retail, Natick Collection) 7- Modular Home / Manufactured (prefab, my house) 8 - Mobile Homes 9 - Timeshares

A transaction broker is not known as a fiduciary. A transaction broker is a facilitator, intermediary, or nonagent, because neither party in the transaction is a client. The parties are customers. A fiduciary is a person placed in a position of trust and confidence.

A general agent is expected to be involved in an on-going business relationship. A special agent in limited to a specific transaction. A universal agent is acting on behalf of a person, as if he/she was the person. (Guardian) A licensee who has listed a property is a general agent to the broker, because they are expected to be in an on-going business relationship; and the licensee is a special agent to the seller, because the agency relationship is limited to that transaction.

An agent is listing a vacant city lot. Which method of legal description would MOST LIKELY be found in the deed? A. Metes and Bounds B. Lot and Block C. Government Survey D. Rectangular Survey Correct Answer - B. A lot-and-block survey is used to describe subdivisions and vacant city lots. It is also called a recorded plant because the lot and block number refer to a plat map filed in public records office.

A surveryor would calculate which of the following to compensate for the curvature of the earth? A. Section lines B. Township lines C. Check lines D. Correction lines Correct Answer - D. Correction lines are used to compensate for the curvature of the earth.

26. An appraiser is going to estimate the market value of a library. Which appraisal method will he/she most likely use? A. Gross Rent Multiplier B. Gross Income Multiplier C. Cost Approach D. Market Approach 26. C - The Cost Approach is used to appraise special purpose properties such as houses of worship, libraries, post offices and new buildings where there are no comparable properties.

A. "Empty Nesters are perfect for this community!" B. "Great house for a man!" C. "No more than two children are allowed in the apartment." D. "This house has a wheelchair ramp." 27. D - Remember, describe the property, not the people! It is legal to say that a house has a wheelchair ramp.

. Which of the following would be future interests in a fee simple defeasible estate? A. Remainder/ Reversion B. Reconveyance/Redemption C. Possibility of Reverter/Right of Re-Entry D. Dower/Curtesy 12. C - A fee simple defeasible estate means that the title may revert upon the occurrence or non-occurrence of a specified event. The two types of fee simple defeasible estates are special limitation with the possibility of reverter and condition subsequent with the right of re-entry.

Agnes, Zelma and Jayne are sisters and own a property as joint tenants. Jayne sold her share to Maggie. Upon closing, Maggie is a A. joint tenant with Agnes and Zelma. B. tenant in common with Agnes and Zelma. C. tenant by the entirety with Agnes and Zelma. D. tenant at will with Agnes and Zelma. 13. B - Joint tenancy requires the unities of time, title, interest and possession. When Jayne sells her property to Maggie, the unity of time and title is breached. Agnes and Zelma are still joint tenants, but Maggie would be a tenant in common with them.

A. adjusted sections. B. fractional sections. C. prescriptive sections. D. managed sections. Correct Answer - B. Oversized or undersized sections are called fractional sections.

Benchmark: a standard or point of reference against which things may be compared or assessed. "a benchmark case" synonyms: standard, point of reference, gauge, guide, guideline, guiding principle, norm, touchstone, yardstick, barometer, indicator, measure, model, exemplar, pattern, criterion, specification, convention "the settlement became the benchmark for all future negotiations" 2. a surveyor's mark cut in a wall, pillar, or building and used as a reference point in measuring altitudes.

If a broker refused to give a deposit to a seller when the seller demanded it, this conduct would subject the broker to disciplinary action by the Real Estate Commissioner. You must remember; the deposit belongs to the s

Constructive Notice attaches once a document is recorded. Once recorded, subsequent buyers will be deemed to have received "Constructive Notice" regarding the document and its effect on the property in question. This could also be taken by taken possession. Actual Notice is when an individual has first-hand knowledge of something. [For example, if a buyer has knowledge that someone has taken possession of the property that is for sale.]

Property Investment Considerations - appreciation of property - equity increase - tax deduction - capital gains tax exclusion ($500k for a couple, $250 for a single if owned & occupied for at least 2 years)

Electronic Contracts UETA - Uniformed Electronic Transaction Act E-Sign - Electronic Signatures in Global & National Commerce Act

1. D - The right of survivorship is a right found in joint tenancy and tenancy by the entirety, but it is not a part of the bundle of legal rights. The bundle of legal rights include the right of possession, control, enjoyment, transfer, exclusion, and disposition (lease, sell, leave to someone in a will, gift, etc.)

Emblements are annual crops that are classified as personal property of the person who grew them. (Potatoes, tomatoes, tobacco, and corn) They are also known as fructus industralies, or fruits of industry (work). Trees, grasses, and perennials that do not require annual planting are classified as real property. They are also classified as fructus naturales, or fruits of nature.

Factors affecting real estate SUPPLY - labor force availability - construction & material costs - government controls - financial policies

Factors affecting real estate DEMAMD - population - demographics - employment & wage levels

Laws that affect real estate - contracts - state & local zoning - fed and state environemental regulations & tax laws

Housing Affordability & Factors for Loans FHA - Federal Housing Authority VA - Dept. of Veteran Affairs PITI - (Principle, Interest, Taxes & Insurance) - cannot exceed 28% of monthly gross

The Real Estate Settlement Procedure Act (RESPA) applies to what types of real estate transactions? a. All cash sales b. Sales involving seller financing correct c. Federally related mortgage loans d. Sales involving rental agreements e. All of the above.

If a deed is valid it must be: a. Signed b. Recorded c. Witnessed d. All of the above. correct e. Both a and c

UETA - Uniformed Electronic Transaction Act 4 - Provisions - contract cannot be denied, it's illegal - a record or signature cannot be denied, it's illegal - If state law requires a signature, an electronic signature is sufficient - if state law requires a written record, an electronic record is legal

National Do Not Call List Under FTC (Fed Trade Comm) Real estate agents call call up to 18 months after last transaction real estate agents can call up to 3 months after an inquiry If they ask to be taken off your call list, you must, and it's enforced for 5 years

A check is an area of land that is A. 1 mile by 1 mile. B. 6 miles by 6 miles. C. 12 miles by 12 miles. D. 24 miles by 24 miles. Correct answer - D. A check is an area of land that is 24 miles by 24 miles.

The section that is reserved for a school is section number A. 12 B. 16 C. 20 D. 24 Correct answer - B. Section number 16 is reserved for the schools.

The bronze disk that is used to establish elevations and altitudes above sea level is the A. datum. B. benchmark. C. stake. D. spike. Correct answer - B. A benchmark is a bronze disk that is used to establish elevations and altitudes above sea level.

To determine the heights of buildings the surveyor would locate the A. datum. B. plat. C. benchmark. D. monument. Correct answer - A. A datum is a point, line or surface from which elevations are measured.

Economic obsolescence occurs when factors unrelated to the property itself and outside of the owner's control diminish its value. A quick way to judge whether or not a property has become economically obsolete is to analyze whether, under the new circumstances, the location would still be chosen as a home site and, if yes, at what value compared with the current property.

Warehousing refers to the process whereby banks and other lenders make mortgage loans to consumers for the purpose of quickly selling those loans on the secondary market. The distinctive characteristic of the freehold estate is that they endure for an interminable duration.

Which of the following types of discrimination are prohibited by the Fair Housing Act of 1968? a. Behavior b. Age c. Marital Status correct d. Number of children (familial status)

What must a homeowner in foreclosure do to exercise his right of redemption? a. Pay the entire mortgage b. Pay the entire mortgage, plus interest c. Pay the entire mortgage, plus court costs and legal fees correct d. Pay the entire mortgage, plus court costs, legal fees and interest

Benchmarks, iron spikes, and wooden stakes are examples of A. metes. B. bounds. C. datums. D. monuments. Correct answer - D. A monument is a natural or artificial marker that identified the intersection of imaginary boundary lines.

Which of the following is FALSE regarding legal descriptions? A. The metes and bounds legal description is characterized by degrees. B. The rectangular survey is based on two sets of intersecting lines called principal meridian and base lines. C. The lot and block survey is used to record the subdivision of vacant land. D. Sections that are oversized or undersized are called correctional sections. Correct answer - D. Sections that are oversized or undersized are called fractional sections.