Lesson 12 cumulative Quiz

7. What document, which was a precursor to title insurance, summarized who had previously owned a property and listed any encumbrances found in the public records? Abstract of title Certificate of title Chain of title Preliminary report

Abstract of title

2. Which of the following is the document that the borrower must receive at least three days before closing? Affiliated business arrangement disclosure Closing disclosure Impound account statement Loan estimate

Closing disclosure

1. What federal law requires a buyer to withhold 15% of a non-resident alien seller's net proceeds and send them to the Internal Revenue Service? ERISA FIRPTA RESPA TILA

FIRPTA

Which of the following would need to be licensed as an escrow agent? Employee of insurance company that provides escrow services Independent escrow company Lawyer who provides escrow services as part of a client's transaction Real estate broker who provides escrow services in transaction where he was an agent

Independent escrow company

Which of the following loans is not exempt from RESPA? Agricultural loan Loan to purchase four-unit residential building Loan to purchase 30 acres Seller financing

Loan to purchase four-unit residential building

Which of the following is an escrow company not required to do? Join the Escrow Agents' Fidelity Corporation Maintain a minimum of at least $1,000,000 in liquid assets Maintain a trust account Supply the Department of Business Oversight with annual independent audits

Maintain a minimum of at least $1,000,000 in liquid assets

Which of the following is a legal action by a title insurer in California? Charging less than the price on a rate schedule submitted to the Commissioner Charging to prepare a preliminary report Not submitting financial reports to the Commissioner Offering a kickback

Not submitting financial reports to the Commissioner

Which of the following is not a requirement for a valid escrow? Enforceable contract Irrevocable deposit Escrow agent Payment of escrow fee

Payment of escrow fee

Which of the following is false regarding affiliated business arrangements? A customer can't be required to use the services of the affiliated provider A disclosure of the arrangement must be made when referring customers An affiliated business arrangement exists if someone in one company is in a position to make referrals and has an ownership interest in the other company Referrals to affiliated providers are prohibited

Referrals to affiliated providers are prohibited

8. What type of title insurance coverage would not cover 'post-policy' matters, such as encroachments that appeared after the buyers purchased the property? Extended coverage Homeowner's coverage Lender's policy Standard coverage

Standard coverage

12. A buyer takes possession of a property a few weeks before closing, in order to do some remodeling before moving in. The house burns down prior to closing. What happens? The buyer still receives title and is responsible for the agreed-upon purchase price The buyer still receives title and is responsible for the new market value of the destroyed property The seller cannot enforce the contract and the buyer's deposit is returned The value of the loss is divided between the buyer and seller

The buyer still receives title and is responsible for the agreed-upon purchase price

20. Which of the following statements about title insurance is false? The insurer is always liable for the total amount of the insured's losses, if a problem occurs The lender's policy remains in force until the loan has been paid off The owner's policy remains in force as long as the buyer owns the property Title insurance requires only one premium payment, at closing

The insurer is always liable for the total amount of the insured's losses, if a problem occurs

Which of the following is not a method of terminating an escrow? At closing Default by one party Mutual agreement Unilateral withdrawal by one party

Unilateral withdrawal by one party

10. An escrow agent is a: dual agent and a general agent dual agent and a special agent single agent and a general agent single agent and a special agent

dual agent and a special agent

. A transaction collapses, and the buyer and seller dispute ownership of funds placed into escrow. The escrow agent deposits the funds with a court and files a suit to determine the funds' owner. This action is known as a/an: declaratory relief interpleader action partition action quiet title action

interpleader action

A standard title insurance policy: covers encumbrances and adverse possession, as well as invalid deeds is also known as a CLTA policy is also known as a mortgagee's policy will be based partly on a surveyor's inspection of the property

is also known as a CLTA policy

3. A preliminary report: is a binding representation of the condition of the title is also known as an abstract of title is not a basis for liability on the part of the title insurance company will result in denial of coverage if any title problems are found

is not a basis for liability on the part of the title insurance company

A title insurance policy for the benefit of the buyer is known as a/an: lender's policy mortgagee's policy mortgagor's policy owner's policy

owner's policy

A seller deposits a deed into escrow, and then dies the next day, before closing occurs. The transfer of title is considered to have happened as of the day the deed was deposited into escrow, under the: duty to defend intestate succession statute relation back doctrine Uniform Vendor and Purchaser Risk Act

relation back doctrine

Escrow instructions are usually: oral instructions, issued jointly by buyer and seller oral instructions, issued separately by buyer and seller written instructions, issued jointly by buyer and seller written instructions, issued separately by buyer and seller

written instructions, issued jointly by buyer and seller