Final Exam

A purchaser of real estate is entering into a land contract with the seller. The purchaser should expect legal title when: A: the seller has been paid in full B: the buyer takes possession of the property C: the land contract is recorded in public records D: making the first land contract payment to the seller

A A land contract is different from other types of financing in that legal title does not pass to the buyer during the term of the land contract. Legal title passes only when the seller is paid in full.

What is a planned unit development? A: A regulatory process which promotes unified development for a development specially approved by the zoning authority for the developer B: A regulatory framework for protecting land near bodies of navigable water C: A process for a government to take private property for a public development D: A development where single family homes are owned as condominiums

A A planned unit development (PUD) is a regulatory process which promotes large scale, unified land development by means of mid-range, realistic programs in chase of physically curable, social and economic deficiencies in land and cityscapes. A developer seeking to create a PUD must obtain approval for the relevant land use and zoning authorities.

After entering into a sales contract a seller discovers a defect on the property, the: A: seller must comply with the terms of the sales contract B: buyer can direct the seller on how to repair the defect C: seller must update the real estate condition report and give a copy to the buyer D: contract becomes null and void at the buyer's discretion

A A real estate condition report is used to disclose defects known by the seller prior to the acceptance of the offer. After the offer is accepted, the sales contract dictates how the parties must proceed.

Which of the following is not considered real property? A: Farm equipment B: Fences C: Growing shrubs D: Built-in appliances

A Shrubs, bulbs, trees, fences, and built-in appliances are all considered real property. Farm equipment, because it is not attached, is considered personal property like a car, trailer, or snowmobile.

If a seller nets $140,000 on their home after paying the listing firm an 8% commission, what was the sales price of the home? A: $152,000.42 B: $152,200.68 C: $152,173.91 D: $152,500.50

C $140,000 / .92 = $152,173.91 sales price

A seller accepts an offer for $91,575 with a $10,000 mortgage carried by the seller for the buyer. After adjustments between the parties were made on the closing statement, the buyer ended up owing the seller $78,500 in cash on closing day. What was the amount of transfer tax paid by the seller? A: $244.80 B: $274.72 C: $274.80 D: $235.50

C $91,600 x .003 = $274.80.

The owner of a property just found out that the municipality is going to be putting in sidewalks. The cost of the sidewalks is going to be assessed at $18.00 per linear foot. The owner has a 120-foot lot excluding the driveway. How much will the property owner's special assessment be? A: $1,750 B: $1,970 C: $2,160 D: $2,000

C 120 feet x $18 = $2,160.

A buyer discovered defects during the home inspection and the seller has the right to cure. Which of the following forms would be used to inform a seller of defects a buyer would like to have repaired prior to closing? A: Multiple Counter-Proposal B: Counter-Offer C: Notice Relating to Offer to Purchase D: Amendment to Offer to Purchase

C A WB-41 Notice form should be used when one party unilaterally is giving notice to the other party relating to an accepted offer to purchase.

What document does a seller use to convey ownership of personal property to a buyer? A: An evidence of ownership B: An abstract of title C: A bill of sale D: A warranty deed

C A bill of sale is used to transfer ownership of personal property from one party to the new owner. You can think of a bill of sale as the "deed" for personal property. Ownership of real estate is transferred using a deed and ownership of personal property is transferred using a bill of sale.

When acting as a buyer's agent, a license must disclose buyer agency to all parties or risk a claim of: A: HUD violations B: Fair Housing violations C: misrepresentation D: RESPA violations

C Failing to disclose an agency relationship with a buyer could lead to a claim of misrepresentation against a license if the seller or listing firm thought the licensee was acting as a selling firm.

Which of the following advertisements does NOT violate fair housing laws? A: "No children under the age of 16." B: "Security deposit - $700 or $800 for tenant's with children." C: "Room available, shared bathroom, female only." D: "Perfect for young families."

C The Fair Housing Act and Wisconsin law make it unlawful to print or publish any statement, notice, or advertisement with respect to the sale or rental of a dwelling that indicates a preference of a federally protected class. An advertisement can mention gender if there will be shared living space such as someone renting out a room in a person's home.

How can a buyer terminate a buyer agency agreement according to the terms of the WB-36 Buyer Agency Agreement? A: Notarized statement B: Email C: In writing D: Verbally

C The WB-36 provides that early termination must be in writing.

A buyer hires a firm to locate a specific type of property for a buyer. The buyer's licensee, upon finding the property, does not make the buyer aware of it and purchases it for himself. What duty to the buyer did the licensee violate? A: Disclosure of material adverse facts B: Confidentiality C: Loyalty D: Accurate market conditions

C The duty of loyalty requires an agent to put the interests of the client ahead of everyone else. Purchasing a property without telling a client about it first violates the duty of loyalty.

Which of the following is NOT a duty owed to a customer? A: Confidentiality B: Reasonable skill and care C: Disclosure of material facts D: Acting in an honest and fair manner

C The requirement to disclose material facts only applies to a client. A licensee must disclose material adverse facts to all parties in the transaction.

Who must receive a copy of the signed offer to purchase? A: The lender, the buyer, the seller, and the appraiser B: The seller C: The seller and the buyer D: The buyer

C Wis. Admin. Code § REEB 15.02(1) A licensee shall promptly provide an exact and complete copy of any document utilized, prepared, or received by the licensee in real estate practice to any person who has signed the document.

Calculate the monthly payment for a mortgage of $120,000 at 9 percent for 20 years. The factor is 9. A: $1,200 B: $1,080 C: $960 D: $1,060

B $120,000 x 9 = $1,080,000. $1,080,000/$1000 = $1080. To find the mortgage payment, multiply the loan amount by the factor and then divide by 1000.

A borrower is obtaining a loan for $130,000. The loan is 95% of the property's value. The interest rate on the loan is 5% after the borrower pays two points. How much do the two points cost the borrower? A: $2,700 B: $2,600 C: $2,500 D: $2,800

B $130,000 principal loan amount x .02 = $2,600 cost of points.

The commission on the sale of 123 Anywhere Drive was $18,500, based on a 6.5 percent commission rate. What was the final selling price of the property? Use whole numbers. A: $2,846,154 B: $284,615 C: $28,462 D: $2,846

B $18,500/ .065 = $284,615.

If property is valued at $65,000 and assessed for 60 percent of its value, what is the tax if the rate is $5.30 per hundred? A: $2,677 B: $2,067 C: $2,670 D: $2,607

B $65,000 x .60 = $39,000 assessed value. $39,000 x .053 = $2,067 tax bill.

What type of loan program requires the borrower to pay 20% of the purchase price or to obtain private mortgage insurance to cover the difference? A: Nonconforming loan B: Conventional loan C: Federal Housing Administration (FHA) loan D: Department of Veteran's Affairs (VA) loan

B A conventional loan requires the borrower to invest 20% of the purchase price towards a down payment in order to receive financing. Lenders will originate loans to borrowers with a lower down payment if the borrower purchases PMI.

Which of the following would a licensee have to disclose to all parties in the transaction? A: Receiving a referral fee from another licensee for the referral of a listing B: A buyer's licensee is representing the licensee's sister in the purchase of a property C: A buyer's firm is receiving commission from the buyer D: A seller is paying an incentive to a buyer at closing

B A license acting as an agent in a real estate or business opportunity transaction may not act in the transaction on behalf of the licensee's immediate family without the prior written consent of all parties to the transaction. The buyer's licensee is an agent representing in this case a family member; therefore, they must disclose this interest.

Jessica made her final mortgage payment to Bank of Money. Bank of Money will execute which of the following to reflect that Jessica has paid off her mortgage? A: Release of mortgage deed B: Satisfaction of mortgage C: Promissory note D: Certificate of mortgage

B A satisfaction of mortgage is executed when a loan has been fully paid off.

How should a licensee number counter-offers? A: Show the date of the Counter-Offer in the blank provided in the upper right hand corner B: Number the form according to how many counters have been made in total by buyer and seller C: Identify the form ID number assigned to that particular Counter-Offer form D: Number the form according to how many counters have been made by that party

B WB-44 Counter-Offer, note at the top of the form.

Where in the WB-1 Residential Listing Contract would a seller indicate the seller's choice of multiple representation with designated agency? A: Line 115 B: Line 118 C: Line 287 D: Line 113

D

At closing, the seller needs to give a credit to the buyer for property taxes. Last year's taxes were $3,700 and there are 242 days from the first of the year through the day of closing. How much will the buyer's tax credit be? A: $2,346.15 B: $2,587.03 C: $2,453.15 D: $2,443.02

D $3,700 / 365 day year = $10.1370 daily proration. $10.1370 x 241 days between January 1 and the day prior to closing = $2,443.02.

If, after receiving an offer from a prospective buyer, the seller makes a counter-offer, the prospective buyer is: A: bound by the original offer B: relieved of further liability if the seller releases the buyer C: bound by the counter-offer D: relieved of further liability

D A counter-offer is a rejection of a previous offer. The parties of a rejected offer are no longer bound by the original offer.

What must firms provide to their licensees? A: Onsite supervising during normal business hours B: Training for how to develop and grow a real estate business C: An arbitration manual for alternative dispute resolution D: A written statement of procedures under which the firm and licensees associated with the firm shall operate with respect to transaction documents

D A firm must provide licensees associated with the firm with a written statement of procedures under which the firm and licensees associated with the firm shall operate with respect to handling documents relating to a real estate transaction

How long does a licensee have to notify the DSPS of a misdemeanor conviction? A: 10 days B: 24 hours C: 48 days D: 48 hours

D A license who is convicted of a misdemeanor or a felony must notify the DSPS of the conviction within 48 hours of the conviction.

A buyer orders a title insurance policy. The title insurance provider searches the public records for the title examination. The title company notifies the buyer in writing of the condition of the title with the: A: chain of title B: deed C: abstract of title D: title insurance commitment

D The title company notifies the buyer of the condition of title in writing with the title insurance commitment. This document is also sometimes call a preliminary report or the title insurance binder but in Wisconsin it is most commonly referred to as the title insurance commitment.

The extension portion of the WB-1 Residential Listing Contract can be found on lines: A: 205-219 B: 151-158 C: 159-166 D: 220-224

D This is the area of the listing contract that describes how the firm's listing contract is extended for a period of one year for protected buyers.

Which of the following is NOT a protected class under the Wisconsin Fair Housing Laws? A: Religion B: Sex C: Age D: Student

D Under Wisconsin fair housing law, the following are protected classes: race, color, religion, national origin, sex, familial status, disability, ancestry, age, sexual orientation, marital status, and lawful source of income.

Beth, Jenny, and Molly all purchased a farm together. The deed only listed each of their names. Which of the following forms of ownership are they presumed to have taken? A: Joint tenancy B: Tenants by the entirety C: In severalty D: Tenants in common

D Unless specifically stated as a joint tenancy, ownership as tenants in common will be presumed. The deed would have to specify "Beth, Jenny, and Molly as joint tenants with the right of survivorship" for them to be treated as joint tenants.

If a buyer wishes to give a Notice of Defects, the buyer MUST provide: A: verbal notice only B: a copy of the home inspector's report with an Amendment C: a Notice of Defects only D: a copy of the home inspector's report with the Notice of Defects

D When a buyer provides a Notice of Defects a copy of the home inspection report the WB-41 Notice Relating to Offer to Purchase should also be sent to the seller. Please refer to lines 421-423 of the WB-11 Residential Offer to Purchase.

When would a licensee NOT have to provide agency disclosure? A: A listing licensee answers a prospective buyer's basic questions at an open house B: A property manager negotiating a lease with a tenant C: A listing licensee is showing a commercial listing to a buyer D: A selling licensee is negotiating an offer to purchase with a buyer

A Agency disclosure to a client needs to occur either prior to entering into an agency agreement with the client. Agency disclosure to a customer must occur prior to negotiations. Holding an open house and answering a buyer's basic questions does not automatically constitute brokerage services. If the conversation went into more detail where a buyer was starting to discuss the terms under which the buyer would purchase the property, then an agency disclosure would need to be given.

To avoid a price-fixing violation, all decisions concerning commissions or fees must be: A: unilateral, independent business decisions B: bilateral, independent business decisions C: bilateral, codependent business decisions D: unilateral, codependent business decisions

A All decisions concerning commission or fees must be unilateral, independent business decisions made solely within the firm's office, without consultation or discussion with any from other real estate firms.

Jane is showing a home to prospective buyer Lester. Jane shows Lester the warped steps of the back porch stairs, describing it as "country charm." She then shows him the "beautifully landscaped herb garden," while pointing to patch of overgrown weeds. Which term below describes Jane's actions in describing the property to Lester? A: Puffing B: Concealment C: Fraud D: Negligent misrepresentation

A Any prudent buyer can see that the warped back porch stairs and overgrown weeds are what they are, rather than how Jane described them. Thus, Jane's statements are considered to be "puffing." Agents must be careful that they do not make any statements in a way to harm the buyer, or to take advantage of the buyer's lack of knowledge. Statements that harm the buyer or take advantage of their lack of knowledge constitute fraud.

Changing the zoning from residential to scenic reserve would be an example of: A: downzoning B: spot zoning C: bulk zoning D: buffer zoning

A Changing zoning from residential to scenic reserve is a change in zoning from a more active to a less active classification.

Licensees are required to disclose to all parties: A: possible material adverse facts B: known material facts C: possible material facts D: known sex offenders

A Licensees are required to disclose to all parties known material adverse facts and possible material adverse facts in writing and in a timely fashion. A licensee only needs to disclose material facts to a client.

The Distribution of Information section of the WB-11 Residential Offer to Purchase states that: A: the listing firm may deliver a copy of the offer to the title company B: selling agents may deliver copies of the offer to other interested buyers C: all information, including confidential information, may be given to an appraiser D: it is illegal to modify the delivery provisions of the offer

A Lines 272-277 state, "Buyer and Seller authorize the agents of Buyer and Seller to: (i) distribute copies of the Offer to Buyer's lender, appraisers, title insurance companies and any other settlement service providers for the transaction as defined by the Real Estate Settlement Procedures Act (RESPA); (ii) report sales and financing concession data to multiple listing service sold databases; and (iii) provide active listing, pending sales, closed sale and financing concession information and data and related information regarding seller contributions, incentives or assistance, and third party gifts, to appraisers researching comparable sales, market conditions and listings, upon inquiry.

"Time is of the essence" means that: A: The action required in the contract must be performed by the date stated in the contract or the party awaiting performance could call the contract void B: The parties are given a reasonable time to perform upon breach of a stated date C: A breach of a stated deadline automatically voids the contract D: Under no circumstances will an extension of time be given if a date is missed

A Lines 322-324 of the WB-11 Residential Offer, "If 'Time is of the Essence' applies to a date or deadline, failure to perform by the exact date or Deadline is a breach of contract. If 'Time is of the Essence' does not apply to a date or Deadline, then performance within a reasonable time of the date or Deadline is allowed before a breach occurs."

If a buyer has properly given a Notice of Defects and the seller does NOT have the right to cure, what is the status of the contract? A: Null and void B: Breach by the buyer C: Seller must cure D: Unenforceable

A Lines 410-433 of the WB-11 Residential Offer to Purchase. Specifically, lines 430-433, "This Offer shall be null and void if Buyer makes timely delivery of the Notice of Defects and written inspection report(s) and: (1) Seller does not have a right to cure..."

There are fair housing laws recognized at the federal, state, and local levels of government. A licensee should abide by the law: A: that offers the most protection B: at the state level C: at the federal level D: at the local level

A Local levels of government have the legal ability to enact fair housing laws as long as the local laws recognize the classes protected under the state law. However, not all local levels of government will have their own laws and unfortunately, some will have laws that contradict the state/federal law and allow discrimination under certain situations. A licensee must follow the law that offers the most protections.

The penalty for knowingly or willfully violating the federal lead-based paint disclosure rules can be: A: $11,000 fine and imprisoned for up to one year, or both B: 10-year prison sentence C: $11,000 fine only D: prison up to one year only

A Penalties for knowingly or willfully violating the federal lead-based paint disclosure rules can be up to $11,000 for each violation and imprisonment for up to one year, or both.

Evelyn and her boyfriend, Noah, are getting married, and are looking to purchase a new home. They have asked you as their real estate licensee for advice on how to take title. What advice can you give them regarding on how they should take title? A: Suggest they speak to an attorney B: As joint tenants, so if one of them dies the other will get the property C: As tenants in common, so that each would have a one-half interest D: Suggest they speak to your supervising broker

A Real estate licensees cannot give legal advice such as how to take title.

Chain of title refers to: A: the succession of conveyances from some starting point whereby the current owner derives title to the real estate B: a insurance policy that protects the holder from challenges to the policyholder's ownership C: a summary or history of all instruments and legal proceedings affecting a specific parcel of land D: a series of links measuring 7.92 inches

A The chain of title for a property is the succession of conveyances from some starting point whereby the current owner derives title to the real estate. A chain of title may start with the original grant of ownership from the United States to the first private owner and all subsequent conveyances up to the current owner.

Jimmy and Sara, a married couple, are selling their primary residence. Both Jimmy and Sara must sign all of the following EXCEPT: A: the listing contract B: any amendments to the offer C: the offer to purchase D: any deed transferring title

A The listing contract, unlike the other contracts, does not require the signature of both spouses in order to be valid. The courts have held that the party signing the contract is responsible for the commission. If only Jimmy signs the listing contract, Jimmy is stating that he alone is responsible for the commission.

Zoning laws may NOT be used to regulate which of the following? A: The placement of interior partitions B: The height and bulk of a building C: The number of persons a building may accommodate D: The purpose for which a building may be constructed

A The placement of interior partitions does not affect public safety. The purpose of zoning is to protect public safety and welfare.

The property being transferred has a purchase price of $475,450. What is the transfer fee the seller will pay at closing? A: $1,426.50 B: $1,426.35 C: $14,263.50 D: $1,440.00

A The transfer fee is $475,500 x .003 = $1,426.50

Which of the following real estate licensee is NOT required to ensure compliance with the federal LBP disclosure law? A: A buyer's firm paid by the buyer B: A selling licensee paid by the selling firm C: A listing firm paid by the seller D: A selling firm receiving a commission from a cooperating firm

A Under the federal LBP law, an agent means any party who enters into a contract with a seller or lessor including any party who enters into a contract with a representative of the seller or lessor, for selling or leasing target housing. This term does not apply to purchasers or any purchaser's representative who receives all compensation from the purchaser.

A licensee is required to disclose: A: material inconsistent with or materially contradictory to the seller's statements or the inspection report of a third party B: the information disclosed on third party inspection reports C: that the property was the site of a specific act or occurrence, if the act or occurrence had no effect on the physical condition of the property or any structures located on the property D: the location of any adult family home, community-based residential facility, or nursing home in relation to the property

A Wis. Admin. Code § REEB 24.07(6): If a licensee's reasonably and diligent inspection reveals facts materially inconsistent with or materially contradictory to the seller's statements or the inspection or investigation report of a third party, the inconsistency shall be disclosed in writing and in a timely manner to the parties.

A listing agent has an accepted offer to purchase on a listing. Another offer is being written and the buyer wants information about the existing offer. What information can the listing agent share with the second buyer? A: The existing offer has a continued marketing (bump) clause B: The seller is looking for secondary offers because the primary buyer's offer contains a well and septic inspection contingency that seller is supposed to pay for and the seller does not want to pay for the inspection C: The existing offer does not look very strong because the buyer is trying to obtain a loan for 100% of the purchase price D: The existing offer meets the seller's closing date requirement of July 15

A Wis. Admin. Code § REEB 24.12 A licensee cannot share the terms of one buyer's offer to purchase with any other buyer. A licensee can say another offer exists, that it has contingencies, or a continued marketing clause but nothing more specific than that.

Who of the following should NOT sign a seller's real estate condition report? A: A listing licensee B: An engineer C: A home inspector D: A seller

A Wis. Stat. § 709.02 Disclosures by Owners of Real Estate..."except that the owner may substitute for any entry information supplied by a licensed engineer, land surveyor or structural pest control operator or by an individual who is a qualified 3rd party or by a contractor about matters within the scope of the contractor's occupation if the information is in writing and is furnished on time and if the entry to which it relates is identified." A listing licensee should NEVER complete or sign a seller's real estate condition report.

A licensee offers payment for a buyer's home inspection. What is this offer from the licensee to the buyer called? A: An incentive B: Commission C: Fee-splitting D: A referral

A Wisconsin allows incentives to be offered to buyers and sellers directly provided they are documented properly prior to closing. Such incentives may be offered in any amount in order to induce the buyers and sellers to purchase or sell.

How are the listing contract and the buyer agency agreement similar? A: They both require all negotiations with a client go through the firm. B: They satisfy the minimum requirements to create a lawful agency relationship and ensure that the firm has the right to enforce its commission with a court. C: They recognize the firm's interests in the transaction as being superior to other parties. D: They will always create a multiple representation relationship.

B Administrative rules will require that all negotiations with a seller under a listing contract go through the listing firm. This is not true for a buyer agency agreement. A buyer that has a valid agreement with a firm is still able to negotiate with other firms or with a seller directly. Both of these forms create a single agency. Multiple representation does not automatically arise just because a firm has an agency agreement with a buyer or a seller. Finally, the firm always needs to put the interests of the client ahead of himself/herself.

When comparing an appraisal to a market analysis which of the following is most correct? A: A market analysis takes value into consideration B: An appraisal justifies value by using past events C: An appraisal determines value D: A market analysis is an objective opinion of value

B An appraiser is trained to provide an unbiased estimate of value. The appraiser will justify the value of the real estate by looking at past events such as what have buyers paid for this type of property in the past.

Omar lists his house with Dave. Nancy goes to Dave's open house and decides she wants to make an offer on the house. Nancy does not have an agency agreement with Dave and she asks Dave to write the offer. Which of the following CORRECTLY identifies the relationship between Dave and Nancy? A: Dave is Nancy's agent B: Nancy is Dave's customer C: Nancy is Dave's client D: Nancy is Dave's principal

B Dave has a listing contract with Omar. Nancy does not sign a buyer agency agreement with Dave. Dave provides brokerage services to Nancy as a customer.

The duties to all parties include all of the following EXCEPT: A: provide brokerage services with reasonable skill and care B: negotiation C: disclosure of material adverse facts D: safeguard trust funds

B Duties to all parties: Safeguard trust funds, provide brokerage services honestly and fairly, present contract proposals in an objective and unbiased manner, confidentiality, provide accurate information about market conditions within a reasonable time after the person's request, provide brokerage services with reasonable skill and care, disclosure of material adverse facts. The duty of negotiation is just for clients.

When renting commercial property to tenants, the property owner or property manager: A: must disclose knowledge of lead-based paint to potential tenants under the lead based paint disclosure law B: needs to be aware of any local equal opportunity ordinances that may affect commercial or industrial properties C: if licensed, must use the state-approved commercial lease form D: must take into consideration the Federal Fair Housing Laws

B Federal fair housing laws do not apply to commercial property. Lead-based paint disclosure is only applicable to target housing, which is housing built before 1978. Wisconsin does not have approved leases for commercial or residential property. Licensees must follow local fair housing or equal opportunity laws and those might apply to commercial properties.

Housing that meets the Fair Housing Act's definition of "housing for older persons" may legally exclude: A: families without children where all members are over the age of 65 B: families with children C: individuals over the age of 62 D: an unmarried couple where both parties are over the age of 62

B If housing meets the Fair Housing Act's definition of "housing for older persons," then it may legally exclude families with children.

Licensees must always avoid communications with licensees from other firms relating to: A: current fair housing law B: commission rates charged to clients C: the loan approval process D: home inspectors

B Licensees must always avoid communications with licensees from other firms relating to the commission rates charged to sellers and buyers, the rates paid to other firms for cooperative commission, and the compensation paid to licensees.

Susan decides to make an offer to purchase Brian's home. Susan has a buyer agency agreement with Nick. Nick writes the offer to purchase and takes it over to Brian's home personally. Nick learns that Brian is at Mike's house so Nick he goes to Mike's house to deliver the offer to Brian. Brian is not at Mike's. Nick hands the Offer to Purchase to Mike and asks him to give the Offer to Brian. For the delivery to Mike to be considered effective delivery under the terms of the offer, on what line of the WB-11 Residential Offer to Purchase would Mike's name need to be stated? A: Line 53 B: Line 38 C: Line 52 D: Line 54

B Line 38 of the WB-11 Residential Offer to Purchase reads, "Seller's recipient for delivery (optional)." Mike's name would need to be listed as seller's recipient (Brian is the seller). Line 39 is for Buyer's recipient for delivery.

How can a seller terminate a listing contract? A: With a phone call to the listing firm B: In writing, delivered according to the terms of the listing contract C: Written notice to the DSPS D: Only with a notarized statement from the seller to the listing firm's MLS

B Lines 263-271 of the WB-1 Residential Listing Contract.

The WB-11 Residential Offer to Purchase states that title evidence shall be given by the seller in the form of a/an: A: deed B: owner's policy of title insurance C: abstract D: promissory note

B Lines 340-342 of the WB-11 Residential Offer to Purchase state, "Seller shall give evidence of title in the form of an owner's policy of title insurance in the amount of the purchase price on a current ALTA form issued by an insurer licensed to write title insurance in Wisconsin."

According to the WB-11 Residential Offer to Purchase who is responsible to pay special assessments levied against a seller's property after the date of the offer but prior to acceptance? A: Listing firm B: Buyer C: Seller D: Selling firm

B Lines 360-362 of the WB-11 Residential Offer to Purchase.

A buyer receives an inspection report that discloses defects as defined by the inspection contingency. Under what circumstances will buyer NOT be able to give a Notice of Defects? A: The defects can be readily cured by seller. B: The buyer had knowledge of the defects at the time of the offer. C: The seller was not aware of the defects. D: The defects existed when seller bought the house.

B WB-11 Residential Offer to Purchase lines 425-426.

The listing contract states that the washer and dryer are included in the sale. The offer to purchase does not mention the washer and dryer anywhere. At the time of closing the washer and dryer: A: will be purchased separately B: must be removed C: are included in the sale D: must be on the property

B Lines 58-60 of the WB-11 Residential Offer to Purchase state "At time of Buyer's occupancy, Property shall be in broom swept condition and free of all debris and personal property belonging to current tenants, or that sold to Buyer or left with Buyer's consent." The offer to purchase determines what property is included or excluded in the transaction. Since the washer are dryer are personal property if they are not addressed in the offer to purchase they must be removed at closing.

Which of the following creates a multiple representation relationship? A: A buyer's licensee presents an offer to a seller B: A buyer's licensee writes an offer for a buyer on a property listed by the buyer's licensee's firm C: A listing licensee presents a counter-offer to a buyer D: A listing licensee writes an offer for a buyer on one of the listing licensee's listings

B Multiple representation occurs when a firm has an agency contract with both the buyer and the seller in the real estate transaction. The phrase "a buyer's licensee" tells us that the buyer has an agency agreement with the firm. "A property listed with the buyer's licensee's firm" tells us that the seller also has a listing contract with that firm. The buyer's licensee's firm has an agreement with both the buyer and the seller.

All of the following are true regarding discount points EXCEPT: A: discount points vary according to the specific loan program B: all loans have discount points associated with them C: they are paid to the lender to make up for the difference between the market rate of a loan and the origination rate of a loan D: they increase a lender's profit

B Not all lenders offer discount points to borrowers.

Which of the following is NOT true of both condominium and cooperative ownership? A: The owner owns the property interest in severalty B: The owner has a real property interest C: The owner has the ability to vote on decisions that affect the developments financial status D: The owner will typically pay a regular maintenance fee

B Ownership in a cooperative is a personal property interest whereas ownership in a condominium is a real property interest.

A buyer uses a buyer's licensee to draft an offer. The WB-11 Residential Offer to Purchase directs the buyer's licensee to make the earnest money check payable to the: A: selling firm's trust account B: listing firm's trust account C: buyer's firm's trust account D: seller's account

B The WB-11 Residential Offer to Purchase states: "Unless otherwise agreed, earnest money shall be paid to and held in the trust account of the listing broker (Buyer's agent if Property is not listed or Seller's account if no broker is involved), until applied to the purchase price or otherwise disbursed as provided in the offer."

A buyer's licensee is representing two separate buyers. Each buyer is interested in the same property. How should the buyer's licensee proceed? A: The licensee should disclose the terms each offer to the other buyer because it is material information. B: The licensee should draft competing offers on behalf of each buyer. C: One of the buyers should be referred to another licensee within the buyer's firm. D: One of the buyers must be turned into a customer.

B The WB-36 Buyer Agency/Tenant Representation Agreement at lines 159-163 provides, "Client acknowledges and agrees that the Firm and its agents may act for other buyers or tenants in connection with the location of properties and may negotiate on behalf of such buyers or tenants with the owner or owner's agent. In In the event that the Firm or its agents undertake to represent and act for other buyers or tenants, the Firm its agents shall not disclose to Client, or any other buyer or tenant, any confidential information of any buyer or tenant, unless required by law."

The WB-36 Buyer Agency Agreement provides that the buyer's firm has the exclusive right to: A: act as an attorney B: act as a buyer's agent C: negotiate for property D: locate property

B The WB-36 provides that the buyer's firm has the exclusive right to act as a buyer's agent. The form would need to be modified to create and exclusive right to locate or negotiate.

Which of the following is a duty owed ONLY to a client? A: Safeguard trust funds B: Loyally represents interests C: Disclose material adverse facts D: Objective presentation of contract proposals

B The duties owed to a CLIENT include: Loyally represent the client's interest, provide information and advice on matters that are material to the client's transaction, disclose all material information, fulfill any obligation required by the agency agreement that is not in conflict with the law, and the duty to negotiate on behalf of the client, unless waived.

Four condominium units are valued at $200,000; $215,000; $220,000; and $225,000; a total value of $860,000. The four condominiums have an annual property maintenance fee $8,500. If the amount of the property maintenance fee owed by each unit is based upon the unit's value, what percentage of the total fee does the most expensive unit owe? A: 3.8% B: 26% C: 26.5% D: 25%

B The most expensive unit is $225,000. The total value of all the units is $860,000. $225,000 / $860,000 = .2616 or 26%.

Four condominium units are valued at $200,000; $215,000; $220,000; and $225,000; a total value of $860,000. The four condominiums have an annual property maintenance fee $8,500. The amount of the property maintenance fee owed by each unit is based upon the unit's value; what is the monthly maintenance fee of the most expensive unit? A: $177.08 B: $184.17 C: $2,125.00 D: $708.33

B The most expensive unit is $225,000. The total value of all the units is $860,000. $225,000 / $860,000 = .2616 or 26%. The annual maintenance fee for all the units is $8,500. $8,500 x .26 = $2,210 per year for the most expensive unit. $2,210/12 months determines the monthly maintenance fee of the most expensive unit is $184.17.

Four condominium units are valued at $200,000; $215,000, $220,000; and $225,000. Together the annual property maintenance fees for the condominiums are $8,500. What is the total value of the units? A: $465,000 B: $860,000 C: $868,500 D: $415,000

B The total value of the four condominiums is $860,000.

What type of mortgage law is recognized in Wisconsin? A: Abstract theory B: Lien theory C: Intermediate theory D: Title theory

B Under lien theory, the buyer has legal title and the lender has the right to place a lien on the buyer's property given as collateral for the loan.

Which of the following documents does NOT have to be delivered promptly to the parties after it is signed? A: Counter-offer B: Lease agreement C: Amendment to offer to purchase D: Offer to purchase

B Wis. Admin. Code § REEB 15.02 Copies of documents - A licensee shall promptly provide an exact and complete copy of any document utilized, prepared, or received by the licensee in real estate practice to any person who has signed the document. A broker or salesperson shall promptly distribute an exact and complete copy of a lease or rental agreement which has been accepted and signed by all parties to the tenant upon execution of the lease or rental agreement when the tenant leases the property and to the landlord upon the landlord's request.

When using an approved form, a licensee may: A: delete form language on a computer before printing the form B: cross out provisions to reflect the agreement of a party to a transaction, provided that the deleted provisions remain legible C: add new numbered lines to the form D: charge a fee for preparing the form

B Wis. Admin. Code § REEB 16.06. A licensee cannot all additional lines. Any language that the party does not want included in the approved form may be stricken in such a way that the original language remains legible. Licensees cannot delete language from a form so that a party to the transaction is not aware of the deleted language. Licensees may never charge for completing a form.

Which of the following is CORRECT regarding a property owner who holds a real estate license? A: The property owner must pay interest on the security deposit equal to the standard interest rate paid at a federal reserve member bank. B: The property owner may place security deposits into a real estate trust account. C: The property owner may spend the security deposits as long as they have the money available at the end of the lease. D: The property may automatically place security deposits into their personal account.

B Wis. Admin. Code § REEB 18.031 A licensee having an ownership interest in a rental property shall either place security deposits related to that property in a real estate trust account or shall provide in a lease for security deposits to be held in an account maintained in the name of the owner or owners.

Which of the following activities requires a real estate license? A: A personal representative selling the real property of an estate B: Receiving compensation to procure a buyer for another person's business C: A property manager showing a rental unit D: An adult child helping an elderly parent with the sale of their home

B Wis. Stat. § 452.01(d) A broker means any person who for another and for a commission, money or other thing of value, negotiates or offers or attempts to negotiate a sale, exchange, purchase or rental of any business, its goodwill, inventory, fixtures or an interest therein.

Which of the following services may a licensee provide without an agency agreement? A: Write an offer to purchase B: Answer a buyer's questions about the location of a property C: Draft paperwork necessary to accomplish the instruction of the parties D: Advertise a seller's property on the Internet

B Wis. Stat. § 452.135: No firm, and no licensee associated with a firm may provide brokerage services without an agency agreement that authorizes the firm to provide those brokerage services. Answering basic questions about a property does not constitute brokerage services. Subagents are authorized to participate in the transaction by the listing contract.

Who signs a deed? A: The seller and seller's attorney B: The seller C: The buyer D: The seller and buyer

B Wis. Stat. § 706.02 says that a valid conveyance must identify the parties, identify the land, identify the interest conveyed, is signed by or on behalf of each of the grantors, is signed by each spouse is a homestead property, and is delivered

A licensee is listing a 4-bedroom, two-story house. Which of the following would be the most suitable comparable property? A: A 4-bedroom, two-story house that was recently foreclosed on B: A two-story mixed use property C: A 3-bedroom, two-story house that was recently sold in the same neighborhood as the listed property D: A 4-bedroom, two-story house that is currently for sale in the neighboring town

C A comparable property is a similar property currently being sold. The maximum value of a property tends to be established by value of similar properties that have recently sold. A foreclosed property does not provide a good comparison because it is not an arm's length sale.

How must a supervising broker delegate supervision to another broker? A: By email B: With a notarized Delegation of Supervision statement from the Department of Safety and Professional Services C: In a written statement signed by both brokers D: The delegating broker must transfer all ownership in the company to the receiving broker

C A firm can delegate supervision responsibility in writing as long as the delegation is signed by both the broker/firm delegating and the recipient of the delegated authority.

What must a firm provide to its licensees? A: Legal assistance in transactions B: Copies of the approved forms C: Reasonable access to a supervising broker D: Business cards

C A firm must provide its licensees with access to a supervising broker. The access must be reasonable and can be via phone, email, text, or other means if suitable.

The Statute of Frauds applies to all the following real estate transactions EXCEPT: A: a listing contract B: an option to purchase C: a lease for less than one year D: an offer to purchase

C A lease for less than one year can be an oral contract. A court would consider it enforceable against both parties.

What event would NOT terminate a listing contract? A: The seller declared bankruptcy. B: The seller decided not to sell the property at this time. C: A sales contract failed to close. D: A lender foreclosed on the seller's property.

C A listing contract can be terminated by: death or incapacity of the principals, destruction or condemnation of the property by eminent domain, expiration of the term, mutual agreement, breach, operation of law, or completion. Bankruptcy and foreclosure are examples of operation of law. The seller has the power to cancel the listing contract at any time. A sales contract that fails to close would not have any effect on the listing contract.

Which of the following services should NOT be performed for a buyer-customer? A: Refusing to provide legal advice regarding the validity of a contract B: Disclosing the fact that seller will not make the repairs called for in the offer by the deadline specified in the offer C: Creating a market analysis of the property the buyer wishes to purchase D: Disclose the disadvantages of the seller's counter-offer when presenting it to the buyer

C A market analysis should not be performed for a buyer-customer. A licensee should provide market information to a buyer-customer that asks for it. This is typically accomplished by giving the buyer MLS datasheets, however; interpreting that data for the buyer is likely a violation of the loyalty duty owed to a seller.

Which of the following allows a property owner to use property in a way that was once allowed but is no longer permitted under current zoning regulations? A: Variance B: Conditional use C: Nonconforming use D: Spot zoning

C A nonconforming use is a use of property was once permitted but is no longer permitted under current zoning regulations. The use is considered "grandfathered" in and the property owner can preserve nonconforming use status by continuing to use the property in the nonconforming way. An agent can list and sell a nonconforming use and the new owner typically needs to use the property in the same way to preserve the status as a nonconforming use.

Which of the following is NOT a right associated with property ownership? A: The right to sell or convey the property B: The right of enjoyment C: The right to use the property in any manner desired by the property owner D: The right to use the property as collateral for a debt

C A property owner has the following six rights: disposition, encumbrance, quiet enjoyment, control, possession, and exclusion. A property owner has a right to use the property but that right does not extend to using the property in an unlawful manner.

According to the terms of the WB-1 Residential Listing Contract which of the following could be a protected buyer? A: A buyer who attended an open house B: A buyer who looked at the property on the MLS C: A buyer who attended an individual showing D: A buyer who called the listing firm for the number of bedrooms

C According to the terms of the 2016 WB-1 Protected Buyers are defined on page 4 as, "a buyer who personally, or through any person acting for such buyer" 1) delivers to Seller or firm a written offer to purchase exchange or option on the Property during term of this listing; 2) views the property with the seller or negotiates directly with Seller by discussing with Seller the potential terms upon which buyer might acquire an interest in Property; 3) attends an individual showing of the Property only if firm delivers the buyer's name to Seller, in writing, no later than three days after the expiration of the Listing; 4) discusses with firm or cooperating firms the potential terms upon which buyer might acquire an interest in the Property, but only if the firm delivers the buyer's name to Seller, in writing, no later than three days after the expiration of the Listing. An open house is not an individual showing. If the firm wanted to have open house attendees be protected buyers, additional language would need to be included.

Which of the following activities can an unlicensed personal assistant do? A: Conduct an open house B: Complete an offer for a buyer C: Schedule appointments D: Attend showings

C An unlicensed personal assistant cannot do any activities that would require a real estate license such as showings, open houses, or completing forms. An unlicensed assistant can complete activities that do not require a license such as scheduling appointments.

A selling agent has given the buyer information on the real estate market and suggested a purchase price for the buyer's offer. The selling agent has likely created what type of agency with the buyer? A: General B: Express C: Implied D: Single

C By treating the buyer like a client, the selling licensee has likely created an implied agency agreement and possibly undisclosed multiple representation.

An offer is written and subsequently rejected. The buyer gave earnest money with the offer. What would be the proper procedure to return the earnest money? A: The earnest money can be returned after an earnest money disbursement agreement is signed by both the seller and the buyer. B: The earnest money can be returned after an amendment to the offer to purchase is signed directing the listing firm to return the earnest money to the buyer. C: The earnest money can be returned to the buyer. D: The earnest money can be returned after a Cancellation Agreement and Mutual Release is signed.

C Generally, the firm must deposit earnest money in a real estate trust account within 48 hours of receipt. Wis. Admin. Code Chapter REEB 18 allows for the disbursement of trust funds upon rejection, expiration or withdrawal, prior to binding acceptance, of an offer to purchase, Therefore, if the offer is rejected, withdrawn or expires prior to the 48 hours, the firm may return earnest money to the buyer. It would be prudent practice to make a photocopy of the earnest money check and document the return.

A seller accepts an offer for $175,000. Two weeks before closing a tornado causes $50,000 in damage to the property. What must the seller do? A: Allow the buyer to rescind the offer B: Amend the real estate condition report and deliver a copy to the buyer C: Notify the buyer in writing wait for the buyer to decide what happens next D: Repair the defect

C If defects are discovered after an offer is accepted, the language in the offer specifies what will occur. Lines 206-215 of the WB-11 Residential Offer to Purchase state "If, prior to closing, the Property is damaged in an amount of not more than five percent (5%) of the selling price, Seller shall be obligated to repair the Property and restore it to the same condition that it was on the day of this Offer. If the damage shall exceed such sum, Seller shall promptly notify Buyer in writing of the damage and this Offer may be canceled at the option of Buyer."

A buyer has selected multiple representation without designated agency. A seller has selected multiple representation with designated agency. The buyer wants to buy that seller's house. Which of the following is true? A: The seller's licensee can tell the seller that the buyer has been pre-approved for far more than the list price. B: The buyer's licensee can tell the buyer that the property is overpriced. C: The firm and all of its licensees must remain neutral. D: The firm must assign a designated agent for the seller and a designated agent for the buyer.

C If one party selects multiple representation with designated agency and the other party selects multiple representation without designated agency, the agency choices do not match. That means the firm and all its licensees must remain neutral.

In the event a seller unilaterally cancels the listing contract before its expiration date, what can a listing firm do? A: Report the seller to the DSPS B: Sue the seller for specific performance C: Demand compensation for the damages sustained as a result D: Inform the seller that they must go forward until the listing expires

C In the event that seller cancels the listing contract unilaterally before its expiration date, the firm may demand compensation for the damages sustained as a result. The firm cannot sue the seller for specific performance and cannot compel the seller to remain in the relationship as a party to the listing contract.

A licensee is required to do all of the following EXCEPT: A: be knowledgeable regarding laws, public policies, and current market conditions on real estate matters B: assist, guide, and advise the buying or selling public C: have the technical knowledge, skills, or training possessed by competent third-party inspectors and investigators of real estate and related areas D: protect the public against fraud, misrepresentation, and unethical practices

C Licensees are not required to have the technical knowledge, skills, or training possessed by competent third-party inspectors and investigators of real estate and related areas.

Elements reserved for the exclusive use of one or more, but not all members of a condominium are called: A: deed restrictions B: common elements C: limited common elements D: declarations

C Limited common elements are elements that are reserved for one or more unit owners and are not available for use by all the unit owners as are common elements.

What section in the WB-1 Residential Listing Contract requires licensees to disclose commission offered to cooperating firms? A: Commission B: Extension of listing C: Compensation to others D: Marketing

C Lines 52-53 of the WB-1 listing contract require the firm to disclose the commission offered to a cooperating firm

Multiple representation without designated agency is when: A: the seller is the firm's only client in the transaction B: the firm may place the interests of the seller-client ahead of the buyer-client C: both the seller and the buyer are clients of the firm in the same transaction D: a client does not have to consent prior to the firm's participation

C Multiple representation without designated agency is where both the seller and buyer are clients of the firm in the same transaction. Both the seller and the buyer have consented in writing to this relationship.

An agent pays her unlicensed personal assistant a percentage of each commission she earns. What is this called? A: Net listing B: Independent contractor negotiation C: Fee-splitting D: Hourly wages

C Paying an unlicensed individual a portion of a licensee's commission is fee-splitting. Fee-splitting is illegal.

A lender is in the practice of restricting the number of loans or the loan-to-value ratio in certain areas of a community. This is a violation of fair housing law and is called: A: discounting B: blockbusting C: redlining D: steering

C Redlining is restricting the number of loans or the loan-to-value ratio in certain areas of a community. The decisions on whether or not to issue a loan or a homeowners insurance policy must be made on the creditworthiness of the individual not the location of the property.

Which of the following statements is true of property held in joint tenancy? A: Joint tenants do not have the right to file a lawsuit asking for partition of the property B: A deed will not convey any interest unless signed by both spouses C: If a joint tenant dies, the surviving tenant or tenants receive the interest of the deceased joint tenant D: The deceased joint tenant's interest passes to the heirs of the deceased

C Survivorship between owners is a key element of a joint tenancy.

A Listing Contract is signed July 1, 2016. An Offer is presented to the seller on July 14, 2016 and the seller accepts the Offer July 15, 2016. The transaction closes on September 15, 2016. The listing firm must keep transaction documents for this transaction until: A: July 1, 2018 B: July 15, 2018 C: September 15, 2018 D: July 14, 2018

C Wis. Admin. Code § REEB 15.04: A firm shall retain for at least two years exact and complete copies of all listing contracts, offers to purchase, leases, closing statements, deposit receipts, cancelled checks, trust account records and other documents or correspondence received or prepared by the firm in connection with any transaction. The retention period shall run from the date of closing of the transaction.

A buyer wants to have the interest earned on their earnest money deposit. Which of the following statements is most correct? A: The firm can give the interest to the buyer with written permission from the seller. B: The firm cannot hold the earnest money but they may draft an escrow agreement for the buyer and the seller C: The firm cannot draft an escrow agreement for the buyer and seller. D: The firm can give the interest to the buyer if the offer to purchase states that the buyer gets the interest.

C Wis. Admin. Code § REEB 18.06 If the parties to a transaction do not desire that the firm hold the earnest money in the firm's real estate trust account, and wish to designate an escrow agent other than the firm, the firm may not draft the escrow agreement. The escrow agreement shall be drafted by the parties or an attorney. The firm may not hold the funds in the firm's real estate trust account, nor may the firm act in any way as custodian of the funds for the parties. The funds, pursuant to the escrow agreement, shall be held by some other party, such as a bank, a savings and loan association, a credit union, or an attorney.

Which of the following would violate advertising rules for real estate licensees? A: Advertising the square footage according to the assessor B: Advertising in a price range agreed to by the seller C: Advertising a property that has already been sold D: Advertising a home warranty offered by the seller

C Wis. Admin. Code § REEB 24.04(1) states, "Licensees shall not advertise in a manner which is false, deceptive, or misleading."

Which of the following are NOT considered client funds? A: Downpayments B: Advanced fees C: Promissory notes D: Earnest money

C Wis. Stat. § 452.13(a) "Client funds" means all downpayments, earnest money deposits, or other money related to a conveyance of real estate that is received by a licensee on behalf of a firm or any other person. "Client funds" does not include promissory notes.

A firm has a contract with a person to pay a finder's fee if the person finds a buyer for the firm's listing. This is permissible if the: A: transaction closes B: person is an unlicensed personal assistant C: person has a salesperson's license D: person acts as a property manager for the listing

C Wis. Stat. § 452.19 No licensee may pay a fee or a commission or any part thereof for performing any act specified in this chapter or as compensation for a referral or as a finder's fee to any person who is not licensed under this chapter or who is not regularly and lawfully engaged in the real estate brokerage business in another state, a territory or possession of the United States, or a foreign country.

If a licensee is asked about the existence of any known sex offenders in the area, to achieve immunity from having to disclose this information, the licensee may: A: ask the seller to interview neighbors to find out if they are sex offenders B: ignore the question C: provide the Department of Corrections' contact information in writing D: never have immunity from such disclosures

C Wis. Stat. § 452.24 Disclosure duty; immunity for providing notice about the sex offender registry. (1) If, in connection with the sale, exchange, purchase or rental of real property, a licensee receives a request from a person to whom the licensee is providing brokerage services in connection with the sale, exchange, purchase or rental for information related to whether a particular person is required to register as a sex offender under s. 301.45 or any other information about the sex offender registry under s. 301.45, the licensee has a duty to disclose such information, if the licensee has actual knowledge of the information. Notwithstanding sub. (1), the licensee is immune from liability for any act or omission related to the disclosure of information under sub. (1) if the licensee in a timely manner provides to the person requesting the information written notice that the person may obtain information about the sex offender registry and persons registered with the registry by contacting the department of corrections. The notice shall include the appropriate telephone number and Internet site of the department of corrections.

Which of the following statements is INCORRECT regarding a licensee's duty to inspect real estate? A: A licensee must conduct a reasonably competent and diligent inspection of accessible areas of a structure and immediately surrounding areas of the property to detect observable, material adverse facts. B: A licensee, prior to listing a property, shall make inquiries of the seller on the condition of the structure, mechanical systems and other relevant aspects of the property as applicable. C: A selling agent is also required to inspect a property prior to or during the showing of the property. D: A licensee does not need to view a home if the buyer wants to write an offer sight unseen.

D A licensee, when engaging in real estate practice that involves real estate improved with a structure, shall conduct a reasonably competent and diligent inspection of accessible areas of the structure and immediately surrounding areas of the property to detect observable, material adverse facts.

All of the following may legally terminate a listing contract EXCEPT: A: condemnation B: mutual consent C: fulfillment of purpose D: a rise in interest rates

D A rise in interest rates may make a property more difficult to market but it would not legally terminate the listing.

What term describes a debt secured by an item of personal property? A: A bill of sale B: A real estate mortgage C: A deed D: A security interest

D A security interest is an interest a creditor holds in an item of personal property when the debt is secured by that item of personal property. A lender may have a security interest in a car, a tractor, machinery, or restaurant equipment for example. A security interest is also know as a chattel mortgage though security interest is the more common term.

When purchasing the property, the owners disclosed that they received permission from the local municipality to build their deck onto the setback lines. This is an example of a: A: permitted use B: conditional use C: nonconforming use D: variance

D A variance grants permission to deviate from a zoning restriction

Which of the following transactions must include a real estate condition report? A: A personal representative selling property that the personal representative has never lived in B: New construction that has never been inhabited C: A transfer of property where the transfer is exempt from the transfer fee D: A seller selling a duplex that the seller has never lived in

D According to Wis. Stat. Chapter § 709 transactions involving the following properties are exempt from the real estate condition report requirements: property that has not been inhabited; transfers exempt from the Wisconsin transfer fee; transfers by personal representative, trustees, conservators, fiduciaries who are appointed by, or subject to the supervision by the court as long as the person has never occupied the property. There is NOT an exemption for a seller that does not live on the property or is not familiar with the condition of the property.

Which of the following is NOT an essential term of a real estate sales contract? A: The identity of the parties B: The price C: The signatures of the parties D: An inspection contingency

D An inspection contingency is not an essential term of a real estate contract. Wis. Stat. § 706.02 Conveyance of Real Property requires the following of a contract: identifies the parties, identifies the land, identifies the interest conveyed and any material term condition, is signed by or on behalf of each of the grantors, is signed or joined in by separate conveyance by or on behalf of each spouse, and is delivered.

Without the written consent of the supervising broker, an agent has the authority to: A: Amend the commission amount B: Enter into a mutual agreement to terminate the buyer agency agreement C: Shorten the term of the buyer agency agreement D: Amend a buyer agency agreement to exclude commercial and agricultural properties

D As stated on lines 243-251 of the WB-36 Buyer Agency/Tenant Representation Agreement, "Agents for Firm do not have the authority to enter into a mutual agreement terminate this Agreement, amend the compensation terms or shorten the term of this Agreement, without the written consent of the agent(s)' supervising broker."

Which of the following does NOT constitute accurate market conditions that would be disclosed by a licensee to all parties in a transaction upon request? A: The length of time a property has been listed B: The number of properties in the neighborhood that have recently sold C: The addresses and conditions of properties that were listed but did not sell D: The racial makeup of the neighborhood

D Licensees are not allowed to discriminate and providing information about people groups would be a violation of the fair housing laws.

According to the WB-1 Residential Listing Contract, which of the following parties is responsible to prepare the property to minimize the likelihood of injury? A: The listing licensee B: The selling firm C: The buyer's firm D: The seller

D Lines 253-258 of the WB-1 Residential Listing Contract. Seller is aware that there is a potential risk of injury, damage and/or theft involving persons attending an "individual showing" or an "open house." Seller accepts responsibility for preparing the Property to minimize the likelihood of injury, damage and/or loss of personal property. Seller agrees to hold the Firm and its agents harmless for any losses or liability resulting from personal injury, property damage, or theft occurring during "individual showings" or "open houses" other than those caused by the negligence or intentional wrongdoing of the Firm or its agents.

When marketing properties, a licensee's liability for providing information regarding lot lines, lot sizes, or room dimensions may lead to all of the following EXCEPT: A: possible filing of disciplinary complaints with the DSPS B: rescission of the transaction C: lawsuits for substantial damages D: a selling bonus

D Mistakes by licenses may be lead to lawsuits for substantial damages, and/or rescission of the transaction, and possible filing of disciplinary complaints with the DSPS.

The "bump clause" time frame does not begin to run until the: A: notice has been dropped into the buyer's agent's overnight box B: notice has been sent by mail to buyer C: notice has been delivered by fax to buyer D: buyer's actual receipt of the notice

D Please refer to lines 310-311 of the WB-11 Residential Offer to Purchase.

What does private mortgage insurance do? A: Ensures that a borrower's loan will be paid in the event the borrower runs into financial problems B: Protects the lender from defaults on FHA mortgages C: Insures the buyer for losses from defects in the title D: Protects the lenders from losses in conventional mortgage defaults

D Private mortgage insurance insures the top 20% of a loan to cover the extra risk to the lender for making a loan to a borrower with less than 20% down.

Which statement best explains why instruments affecting real estate, such as deeds or easements, are recorded in the register of deeds in the county where the property is located? A: Wisconsin real estate law requires interested parties to record instruments affecting real estate. B: Recording is mandatory to comply with the statute of frauds. C: A property cannot be transferred in whole or in part unless the documents are recorded. D: Recording gives constructive notice to the world of the rights and interests in a parcel of real estate.

D Recording instruments affecting real estate such as deeds or easements give constructive notice to the world of the rights and interests in a parcel of real estate.

A buyer may be protected under a previous firm's listing contract in all of the following ways EXCEPT: A: the buyer attended an individual showing of the property B: the buyer discussed the potential terms of purchasing the property directly with the seller C: the buyer submitted an offer to purchase D: the buyer saw the property at an open house

D See lines 205-219 of the WB-1 Residential Listing Contract. Protected Buyer: Means a buyer who personally, or through any Person Acting on Behalf of Buyer, during the term of this Listing: 1)Delivers to Seller or the Firm or its agents a written offer to purchase, exchange or option on the Property; 2)Views the Property with Seller or negotiates directly with Seller by communicating with Seller regarding any potential terms upon which the buyer might acquire an interest in the Property; or 3)Attends an individual showing of the Property or communicates with agents of the Firm or cooperating firms regarding any potential terms upon which the buyer might acquire an interest in the Property, but only if the Firm or its agents deliver the buyer's name to Seller, in writing, no later than three days after the earlier of expiration or termination (lines 263-271) of the Listing. The requirement in 3), to deliver the buyer's name to Seller in writing, may be fulfilled as follows: a)If the Listing is effective only as to certain individuals who are identified in the Listing, by the identification of the individuals in the Listing; or, b)If a buyer has requested that the buyer's identity remain confidential, by delivery of a written notice identifying the firm or agents with whom the buyer negotiated and the date(s) of any individual showings or other negotiations. A Protected Buyer also includes any Person Acting on Behalf of Buyer joined in interest with or otherwise acting on behalf of a Protected Buyer, who acquires an interest in the Property during the extension of listing period as noted on lines 220-224.

Which of the following sales would need to include a lead-based paint addendum to the Offer to Purchase? A: Housing for the elderly built prior to 1978 B: An efficiency apartment without bedrooms built prior to 1978 C: Housing for persons with a disabling condition built prior to 1978 D: A duplex built prior to 1978

D The LBP disclosure addendum is required on all transactions involving target housing. Target housing includes any housing built prior to 1978 except for housing for the elderly or persons with disabilities and 0-bedroom dwellings.

Deadlines expressed as a number of days from an event, such as acceptance, are calculated by excluding the day the event occurred and by counting subsequent calendar days. When does acceptance occur? A: A licensee indicates an offer as being accepted in the MLS B: An offer to purchase that has been signed by all parties is delivered binding the parties C: One party tells another party that they have accepted the offer D: All parties have signed a copy of the offer to purchase

D The WB-11 Residential Offer to Purchase lines 23-24 states: "Acceptance occurs when all Buyers and Sellers have signed one copy of the offer, or separate but identical copies of the Offer."

The WB-11 Residential Offer to Purchase does NOT have any information at lines 38 and 39. This means that: A: the buyer will accept delivery in any form B: the offer cannot be delivered C: the seller can determine how delivery will occur D: binding acceptance can only occur by delivery to the Party, not the agent

D The WB-11 states that delivery of documents and written notices to a Party shall be effective only when accomplished by one of the methods specified at lines 36-54. Even if the Parties select one or more methods of delivery, if a recipient is not name for delivery, then delivery can only occur to the Party.

Which of the following is specific to the WB-4 Condominium Listing Contract? A: The seller needs to indicate the date they completed the real estate condition report. B: The agency disclosure provisions are incorporated into the contract. C: The seller needs to address the property that is included and excluded in the sale. D: The seller needs to indicate whether the sale is subject to a right of first refusal.

D The WB-4 provides an area for the seller to indicate whether the condominium association has a right of first refusal on the unit.

Discount points enable a borrower to: A: reduce the term of the loan B: reduce the principal of the loan C: buy a house with less money down D: reduce the initial interest rate of the loan

D The buy down provisions on a loan allow the borrower to pay points. The borrower purchases points to originate a loan at a lower than market interest rate.

Which of the following general warranty deed covenants guarantees the grantee's physical possession of the property will not be disturbed by former owners? A: Covenant of warranty forever B: Covenant of seisin C: Covenant against encumbrances D: Covenant of quiet enjoyment

D The definition of quiet enjoyment is the right to have uninterrupted use of the property without interference from former owners or tenants.

Title insurance does NOT insure over: A: incorrect marital statements B: forged documents C: facts disclosed by survey D: defects found in public records

D The grantee was already aware of the defect before the transfer of title and the grantee had the ability to discover the defect prior to the purchase of the property.

The market data approach when used by a licensee: A: is an opinion of a property's value B: replaces the need for an appraisal C: is an appraisal D: gives an opinion of the price a property will most likely sell for on the open market

D The market data approach is used to establish the most likely price existing residential real estate will sell for on the open market.

The buyer, in an effort to meet the terms of the Financing Contingency found in the WB-11 Residential Offer to Purchase, delivers a notice to the seller indicating that the buyer is ready to proceed to closing. Has the buyer waived the Financing Contingency? A: No, because the buyer does not have a check from the bank. B: Yes, because the financing contingency has been removed. C: Yes, because the buyer wants to proceed to closing. D: No, because the buyer did not deliver a loan commitment.

D The offer to purchase states at line 219 that the financing contingency is removed when the buyer delivers a loan commitment to the seller within the specified number of days from acceptance. The delivery of the loan commitment removes the financing contingency.

A licensee wishes to sell the licensee's personally owned property without the assistance of the licensee's real estate company. At what point must the licensee disclose the licensee's licensed status? A: At some point prior to closing the transaction B: At the time the buyer decides to write the offer C: Prior to accepting the buyer's offer or counter-offer D: As soon as possible whether that be a showing or first contact with a buyer or agent of the buyer

D Wis. Admin. Code § REEB 24.05(5) A licensee acting as a principal in a real estate or business opportunity transaction shall disclose his/her status and intent to act in the transaction as a principal at the earliest of all of the following: The first contact with the other party or an agent representing the other party or the transaction is being exchanged, a showing of the property, any other negotiation with the seller or the listing firm.

A licensee is going to list a property improved with a structure. Which of the following statements best describes a licensee's inspection duties? A: A licensee needs to complete a reasonably competent and diligent inspection to detect observable, material facts. B: A licensee does not have an inspection obligation. C: A licensee needs to complete a reasonably competent and diligent inspection only if requested by the parties. D: A licensee needs to complete a reasonably competent and diligent inspection to detect observable, material adverse facts.

D Wis. Admin. Code § REEB 24.07(1) A licensee, when engaging in real estate practice involves real estate improved with a structure shall conduct a reasonably competent and diligent inspection of accessible areas of the structure and immediately surrounding areas of the property to detect observable, material adverse facts.

When a depository institution remits the interest earned on a firm's interest-bearing trust account to the Department they must inform the firm of all the following EXCEPT the: A: Rate of interest applied to the account B: Service charges on the account C: Account balance D: Interest earned on the account

D Wis. Stat. § 452.13(2)(e)(1) When a depository institution remits interest to the Department they must furnish to the firm maintaining the interest-bearing trust account the rate of interest applied, the amount of service charges or fees deducted, if any, and the account balance for the period that the statement covers. The firm does not receive information on the interest that was actually paid.

A firm is allowed to act in a multiple representation relationship when: A: the seller agrees to multiple representation in the listing contract B: the buyer consents to multiple representation in the buyer agency agreement C: the offer to purchase is drafted by the Agent of Buyer and Seller D: both clients in the transaction consent in writing to the multiple representation

D Wis. Stat. § 452.135(1) No firm may provide brokerage services to more than one client in a transaction without an agency agreement with each client and a written consent to multiple representation.

A salesperson may practice real estate for: A: only one seller at a time B: any seller who is willing to sign a listing contract C: multiple firms as long as each firm is aware of the other firms D: the firm with which the licensee is associated

D Wis. Stat. § 452.30(7) A salesperson may be associated with only one firm at a given time. (b) A salesperson may not engage in independent real estate practice and may engage in real estate practice only when associated with a firm.

When purchasing a condominium the buyer has the right to a copy of the condominium declaration bylaws within how many days prior to closing? A: 25 B: 20 C: 10 D: 15

D Wis. Stat. § 703.33(1): Not later than 15 days prior to the closing of the sale of a unit to a member of the public, the seller shall furnish to the purchaser a copy of the proposed or existing declaration, bylaws and any rules or regulations, together with an index of the contents.