Moseley Final exam review!!!

An agent engaged by a buyer would breach her fiduciary duties by showing properties that the buyer is interested in to other prospective buyers. Select one: True False

False

If a person has been discriminated against in a real estate transaction, they could file a complaint with the HUD within: a. 1 year b. 90 days c. 180 days d. 2 years

a. 1 year

The statute of limitations as it applies to time-share properties is: a. 5 years b. 2 years c. 1 year d. 7 years

b. 2 years

If a developer (declarant) wants to convert an existing rental property to a time share, how many days notice must be provided to the existing tenants? a. 60 days b. 90 days c. 30 days d. 120 days

b. 90 days

These aid local zoning departments in enforcing zoning: a. Police powers b. Building permits c. Zoning plans d. Variances

b. Building permits

What does the option clause in a lease allow a lessee to do? a. Adjust payment frequency b. Extend existing lease c. Sublet the property to a third party d. Any of the above

b. Extend existing lease

A lease where the tenant pays taxes and maintenance costs is a: a. Gross lease b. Net lease c. Percentage lease d. Ground lease

b. Net lease

Due to a strike at the mill construction lumber is hard to come by lately. How could this shortage affect real estate prices in the area? a. New construction never affects real estate prices b. The real estate prices will rise c. The real estate prices will fall d. Real estate prices will stay about the same

b. The real estate prices will rise

A condensed history of the documents affecting real property is known as: a. the chain of title b. an abstract of judgments c. an abstract of title d. an affidavit of title

c. an abstract of title

Which agent needs to disclose their licensee status in a brokerage agreement? a. Limited service agent b. Standard agent c. Independent contractor d. All of the above

d. All of the above

A condominium could be which of the following descriptions? a. Multi-story building b. Townhouse community c. Industrial office park d. Any of the above

d. Any of the above

Owner Kelly is leaving the area for a one year period. She asks Salesperson Boren to manage her rental home for $45 per month while she is gone. In this situation, which of the following statements is true? a. This is fine because the time element is not longer than one year b. This is fine because the compensation is less than $1,000 c. Boren must put the $45 in an interest-bearing escrow account d. Boren must work through his broker

d. Boren must work through his broker

Broker Antonio has been found guilty of blockbusting, of the potential penalties which should he not be concerned about ? a. Suspension or revocation of his license b. Order to cease the violations c. Up to $100,000 in fines d. Up to 1 year in jail

d. Up to 1 year in jail

Which of the following actions is NOT an act of real estate brokerage? a. Selling a business for a relative b. Renting 1/2 of a duplex for a friend c. Taking a listing d. Helping a friend sell his house for a fee

a. Selling a business for a relative

Steven and his family of five live in a small neighborhood in the suburbs outside of Richmond, Virginia. Steven was just made aware that a registered sex offender moved in across the street and because he has young children has decided to sell his home. Is Steven required to tell any potential buyers the reason he is selling? a. Yes, if the registered sex offender lives within 1 mile of Steven's property b. No, disclosure of registered sex offenders is not required c. Yes, as long as the seller has actual knowledge of a registered sex offender in the area d.Yes, if the potential buyers have children (under age 16)

b. No, disclosure of registered sex offenders is not required

A developer owns four parcels of land. He plans to sell one parcel for construction of an office building. The building plans will require 2 acres, which will include the actual building, landscaping, and parking. Which of the following is the smallest parcel that would accommodate this construction? a. Parcel D: 140 feet x 900 feet b. Parcel C: 120 feet x 860 feet c. Parcel B: 102 feet x 840 feet d. Parcel A: 83 feet x 950 feet

b. Parcel C: 120 feet x 860 feet

If a prospective minority buyer asks an agent to show her some available properties, the agent should: a. Show her properties in areas that are predominantly of the same minority group b. Show her any property for which she is financially qualified c. Refer her to an agent with the same race or ethnicity d. Advise her there are no available properties, even though there are some available

b. Show her any property for which she is financially qualified

In which instance is a broker justified in removing funds from the firm's escrow account? a. To collect their commission b. With a written agreement of all of the parties c. To pay employee salaries d. To pay the firm electric bill

b. With a written agreement of all of the parties

In Virginia, sellers of residential property must disclose that the: a. previous owner was murdered b. basement floods during heavy rain c. neighbor is a registered sex offender d. current occupant is afflicted with HIV

b. basement floods during heavy rain

Tom shows a house with a faulty furnace. Should he tell the buyer/customer after finding out about this condition? a. no, unless he is a dual agent b. yes, because it is material c. yes, because there is an agency relationship d. no, unless he has the permission of the seller

b. yes, because it is material

Regarding appraisals, when an appraiser uses the income approach to estimate value he has to estimate the annual rate of return by either choosing a Capitalization Rate or using a Gross Rent Multiplier (GRM). Which is more accurate? a. Gross Rent Multiplier is more accurate b. Capitalization Rate is more accurate c. Both are equally accurate, just different ways of calculating annual rate of return d. None of the above

b. Capitalization Rate is more accurate

A person who has mineral rights on a property has what type of easement to enter the property and remove minerals? a. Easement by operations of law b. Easement by necessity c. Easement by implication d. Either A or B

c. Easement by implication

___________________________ raise funds through the sale of government guaranteed bonds (backed by its pool of mortgages) to further secondary mortgage market operations. a. Mortgage Lenders b. Mortgage Brokers c. Fannie Mae d. FHA

c. Fannie Mae

Salesperson Vida has been working with her clients, Amy and Aaron, for about two weeks when she has a family emergency that she knows will take her out of town for at least a month. She advises her clients to find a new agent and they agree, but they also give Vida $200 for her help the last couple weeks. Vida uses the gift to buy her plane ticket back home. Such action is: a. Legal, if Vida maintains a record of the gift b. Legal, if Vida performed as agreed for the past two weeks c. Illegal, because Vida can only accept money from her broker d. Illegal, unless properly disclosed

c. Illegal, because Vida can only accept money from her broker

Which legal instrument could convey a tenancy for years? a. Deed b. Land contract c. Lease d. Either A or B

c. Lease

Mel is a real estate agent with ABC Corp. Mel is selling his home and has an interested buyer on the phone, what is something Mel must tell the potential buyer? a. Mel must disclose the square footage of the home b. Mel must disclose when the last survey on the property was completed c. Mel must disclose he is a real estate licensee d. No disclosures are required until a formal disclosure form is presented to the buyer

c. Mel must disclose he is a real estate licensee

"For rent by owner. Share townhouse, 3 bdrm. 2 ba. conv. to shops and trans. Call 123-4567 for details. No handicap or males applicants." Is this ad in violation fair housing laws? a. Yes, handicap cannot be excluded b. Yes, gender types cannot be excluded c. No, this is a legal ad d. Both A and B

c. No, this is a legal ad

Which of the following actions is an example of commingling? a. Using personal funds to open an escrow account b. Placing earnest money from two buyers into the same escrow account c. Placing earned commissions in the same account as earnest money deposits d. Placing earned commissions in the same account as referral fees

c. Placing earned commissions in the same account as earnest money deposits

Escrow agents hold money or documents for a third party until the transaction is complete, who would not be allowed to act as an escrow agent? a. Principal broker b. Attorney c. Salesperson d. Both B and C

c. Salesperson

A broker is conducting a training class for her agents about property condition disclosure forms. Under State law, the ________________ must complete these forms to be provided to any potential buyers. a. Buyer's agent b. Seller's agent c. Seller d. Principal broker

c. Seller

If a broker purchases property through a "straw man" and does not disclose that information, which of the following statements is true? a. This is permitted as long as the seller does not find out b. This is not a violation of the License Law c. This is a violation of the License Law d. This is permitted if the "straw man" is also a broker

c. This is a violation of the License Law

Manteo and Ginnie are parties (buyers) to a real estate sales contract when Manteo loses his job and they decide to back out of the contract. They had provided a $1,500 earnest money deposit at the time the contract was signed and are now requesting their deposit back. Can the Broker simply return the deposit? a. No, the deposit must go to the seller since the buyer breached the contract b. Yes, as long as the buyer and seller agents agree c. Yes, If the sales contract stipulated the deposit must be returned d. Yes, as long as the real estate board approves

c. Yes, If the sales contract stipulated the deposit must be returned

Henry is selling his home and tells his agent to list the home with a sales price enough to generate at least a $20,000 profit so he will have enough money to put down on his next home. If the sale generates a $25,000 profit the agent will keep $5,000 as his commission. What type of listing agreement does Henry have with his agent? a. exclusive agency b. exclusive right-to-sell c. net d. open

c. net

An independent contractor is: a. not a real estate licensee b. subject to all agency duties and disclosures imposed by VA Law c. only subject to duties the licensee and client agree upon d. the same as a standard agent

c. only subject to duties the licensee and client agree upon

According to the Virginia Time-Share Act, advertisements that include a free gift or prize must disclose all of the following details, EXCEPT: a. odds of winning b. retail value c. start date of the offer d. expiration date of the offer

c. start date of the offer

Which fact would a broker most likely be liable for if he failed to disclose it to a buyer? a. the sidewalk is cracked b. the doorbell does not work c. the pipes leak d. the neighbor has loud parties

c. the pipes leak

A final disciplinary decision by the Board is NOT subject to an appeal or a hearing if it involves which of the following: a. A licensee found guilty of conversion b. A licensee who accepted an offer on behalf of a seller c. A licensee found guilty of steering d. A licensee who didn't pay the Transaction Recovery Fund assessment

d. A licensee who didn't pay the Transaction Recovery Fund assessment

The best example of hypothecation is: a. An appraisal b. A listing agreement c. An option d. A mortgage

d. A mortgage

A deed delivered in escrow is given to: a. The mortgagee b. The seller's attorney c. The buyer's attorney d. A neutral third party

d. A neutral third party

By virtue of a signed listing agreement, the broker will generally have authority to do all of the following actions without the seller's consent, EXCEPT: a. Use the MLS to market the property b. Use the services of another broker c. Use the services of the salespersons in his own brokerage firm d. Accept a full price offer for the seller

d. Accept a full price offer for the seller

In Virginia, what action is prohibited in an advertisement for real estate? a. Advertising property without client consent b. Failing to identify a general property description in a listing c. Advertising that a property listed by a firm is for sale by owner d. All of the above

d. All of the above

Harry gives his girl friend Megan a limited power of attorney to sign real estate documents for him while he out of town for work. Megan is best described as: a. A helpful girlfriend b.A real estate agent c. An attorney-at-law d. An attorney-in-fact

d. An attorney-in-fact

What type of estate to time share owner have? a. Estate at will b. Freehold estate c. Estate for years d. Both B and C

d. Both B and C

Which of the following statements is true if a broker has repaid the amounts awarded from the Transaction Recovery Fund? a. His license is automatically reinstated b. The Real Estate Board could deny reinstatement of his license, forever c. He may apply for license reinstatement d. Both B and C

d. Both B and C

This occurs when one or both parties in an agreement fail to do as they promised without a legally recognized excuse: a. Performance b. Defense is exercised c. Voided contract d. Breached contract

d. Breached contract

Deed restrictions usually affect: a. Subsequent owners only b. The current owner only c. All property owners within local government boundaries d. Current and subsequent owners

d. Current and subsequent owners

One of the principal purposes of zoning is to: a. Generate revenue through taxes b. Restrict building c. Restrict business activities d. Effectively plan

d. Effectively plan

When a buyer makes an offer and a seller accepts the offer, what is created? a. A contract b. A purchase agreement c. An agency relationship d. Either A or B

d. Either A or B

Which of the following firm names is in compliance with board regulations? a. Zen Realty b. Salesperson Sally Homes c. Broker Bill Realty d. Either A or C

d. Either A or C

A salesperson listed a property where a murder recently occurred. If the salesperson shows the property without advising potential buyers of the murder, the salesperson would be guilty of: a. Puffery b. Fraud c. Misrepresentation d. Nothing

d. Nothing

Kaylee owns a candy store in the local shopping mall. She pays the landlord rent plus 3% of any candy sale profits above $30,000 annually. What type of lease agreement does Kaylee have with her landlord? a. Reappraisal b. Ground c. Graduated d. Percentage

d. Percentage

If a broker holds an earnest money deposit in an interest-bearing escrow account, what is the disposition of any earned interest? a. It is always credited to the seller at closing b. It is, by regulation, credited to the buyer c. Escrow accounts cannot, by regulation, earn interest d. The broker may keep the interest

d. The broker may keep the interest

Which of the following terms is not an element of value? a. scarcity b. obsolescence c. transferability d. utility

b. obsolescence

Which of the following is the most common type of lease agreement? a. Ground/Land lease b. Gross lease c. Graduated Lease d. Percentage Lease

b. Gross lease

Using the _____________ approach to valuation would be most effective in the appraisal of a shopping center. a. Market Data b. Cost c. Income d. Substitution

c. Income

The unity that exists in both a tenancy in common and a joint tenancy is: a. Time b. Title c. Possession d. None of the above

c. Possession

Which item is personal property? a. Apartment lease b. Business reputation c. Tool shed attached to the brick foundation d. Both A and B

d. Both A and B

All of the following transactions are exempt from the Virginia Property Disclosure Act, except: a. Transactions between co-owners b. Transfers regarding foreclosure c. Transfers due to divorce settlements d. Transactions that occur without the help of a broker

d. Transactions that occur without the help of a broker

Which action returns the parties of a contract to their original position? a. subordination b. novation c. discharge d. rescission

d. rescission

The Do Not Call Registry rules applies to all EXCEPT: a. Business to Business calls b. Political organizations c. Charitable organizations d. All of the above

d. All of the above

What is not a valid method to describe real property? a. Metes and bounds b. Street address c. Government method of survey d. All of the above are valid methods

All of the above are valid methods

Harry the Homeowner buys a new home. The purchase is financed with a conventional, amortized loan equal to $67,000. The interest rate on the loan is 8%, payable over 30 years. Harry's first monthly payment is $500. What is the loan balance after Harry's first payment? a. $66,946.67 b. $65,088.65 c. $64,557.00 d. $60,000.00

a. $66,946.67

A broker is NOT required to hold money in an escrow account if: a. All parties to the contract consent b. Closing is scheduled in less than 30 days c. The deposit amount is less than $1,000 d. The deposit amount is less than his commission amount

a. All parties to the contract consent

Broker Adam is encouraging you to sell since your new neighbors will be Catholics. He says that once they move in, crime will increase and property values will tumble. Your broker is guilty of: a. Blockbusting b. Redlining c. Steering d. Puffery

a. Blockbusting

A licensee is reviewing the property disclosure form with their client, which of the following should be highlighted as most concerning? a. Lead based paint in the basement b. Garage door opener doesn't work c. Bedroom window lock broken d. Driveway needs to be sealed

a. Lead based paint in the basement

Federal Fair Housing Laws do NOT provide protection on the basis of: a. Marital Status b. Handicap c. Sexual preferance d. Both A and C

a. Marital Status

The Federal National Mortgage Association (Fannie Mae), The Government National Mortgage Association (Ginnie Mae) and The Federal Home Loan Mortgage Corporation (Freddie Mac) are all part of the: a. Secondary Mortgage Market b. Primary Mortgage Market c. Commercial Banking System d. Federal Reserve System

a. Secondary Mortgage Market

A broker represents a buyer. While showing a property to his client, the broker learns something that might influence the sale. Nevertheless, the broker may NOT disclose which of the following items to his client? a. That the current owner has HIV b. The broker is unrestricted because he represents the buyer c. That the seller will not accept an offer based on VA financing d. That the seller is in poor financial condition

a. That the current owner has HIV

Jon and Julie enter into a valid sales contract. Pursuant to state law, Jon gathers information about the property condition (including appliances, structural elements, and exterior items). However, Jon gets tired of gathering information and instead decides to sell his home "as is." Can Jon do this without violating the law? a. Yes, as long as Jon completes the necessary paperwork b. No, Jon must disclose each defect c. No, Jon must discover and disclose each defect d. Yes, as long as a buyer agrees

a. Yes, as long as Jon completes the necessary paperwork

Is a Virginia broker allowed to establish a firm office in her residential home? a. Yes, if the office is kept separate from the living space b. No, a firm office cannot operate on a residential property c. Not unless the home office is at least 500 square feet in size d. Yes, as long as there is a separate office parking area

a. Yes, if the office is kept separate from the living space

An appraiser is responsible for: a. estimating the market value b. computing the assessed value c. determining the listing price d. finding the market price

a. estimating the market value

Susan's Aunt Betty is leaving town for a month and has asked Susan to watch her home, pay the bills and take care of anything else that might come up while she is out of town. What will Aunt Betty need to provide Susan with in order for Susan to carry out these duties on her behalf? a. Deed of trust b. A Power of Attorney c. Lease agreement d. A bill of sale

b. A Power of Attorney

Which of the following choices is NOT subject to the Virginia Landlord-Tenant Act? a. The owner of 10 or more single-family rental homes b. A motel room rented for a period of 30 days c. The owner of 5 condominium rentals d. buildings

b. A motel room rented for a period of 30 days

"Dig with C.A.R.E.—Keep Virginia Safe!" is a message established by the Virginia State Corporation Commission (SCC) to assist in educating Virginia citizens about the Underground Utility Damage Prevention requirements. What does C.A.R.E stand for? a. Care, Allow, Respect, Excavate b. Call, Allow, Respect, Excavate c. Call, Avoid, Respect, Excavate d. Call, Allow, Respect, Examine

b. Call, Allow, Respect, Excavate

In Fair Housing discrimination cases, the burden of proof is on the complainant. The complainant must be able to prove: a. That the accused party intended to discriminate b. Discrimination occurred c. Actual damages resulted from the acts of accused d. The act of discrimination was not provoked by the complainant

b. Discrimination occurred

The Federal Fair Housing Act prohibits discrimination on the basis of all of these protected classes, except: a. Sex b. Elderly c. Family d. Religion

b. Elderly

Broker Sam lists a house and sells it 2 months into the listing period. Sam tries to collect his commission after closing, but the seller refuses and correctly asserts that she has no legal obligation to pay. What type of listing did Sam have? a. Exclusive agency listing b. Net listing c. Open listing d. Exclusive right-to-sell listing

b. Net listing

Which act prohibits credit lenders from discriminating against applicants based on race, color, religion, national origin, sex, marital status, age or dependence on public assistance? a. The Virginia Fair Housing Act b. The Equal Credit Opportunity Act c. The Financial Institutions Act d. The Mortgage Fraud Act

b. The Equal Credit Opportunity Act

When acting as a buyer's agent, what responsibilities should the broker have towards the seller of the property? a. To keep the seller informed b. To treat the seller fairly c. To maintain seller's confidentiality d. To maintain loyalty to the seller

b. To treat the seller fairly

A contract which calls for one party to misappropriate or steal money would be: a. Valid b. Void c. Enforceable d. Voidable

b. Void

An associate broker is described as a: a. Non-resident, licensed in another state as a broker b. Broker who is also licensed as a rental location agent c. Broker working for another broker d. A salesperson in training to become a broker

c. Broker working for another broker

Which agency administers and enforces the Real Estate Settlement Procedures Act (RESPA)? a. National Association of Realtors (NAR) b. State License Laws c. Consumer Financial Protection Bureau (CFPB) d. Federal Reserve Board

c. Consumer Financial Protection Bureau (CFPB)

When an agent represents the seller the buyer is: a. Secondary client b. Consumer c. Customer d. None of the above

c. Customer

Sara is purchasing a home. How much should Sara put down if she agrees to pay $80,000 for a house and wants to make a mortgage down payment of 25%? a. $25,000 b. $15,000 c. $30,000 d. $20,000

d. $20,000

A person who owns a fee simple estate could be subject to which of the following controls? a. Zoning and building codes b. Restrictive covenants c. Escheat d. All of the above

d. All of the above

A broker has the buyer's earnest money deposited in an escrow account. The amount of the deposit exceeds the amount of the broker's commission for the sale. The broker can ONLY remove his commission for the sale: a. Anytime since the offer has been accepted and there is a valid sales contract b. When the closing is completed c. Anytime as long as the seller consents d. Once the buyer has officially moved into the property

When the closing is completed

A buyer is purchasing a property for $400,000. His loan-to-value ratio is 80%. How much is the buyer financing? a. $320,000 b. $380,000 c. $340.000 d. $360,000

a. $320,000

Bob and Sue make a combined annual income of $80,000 and pay $1,200 in monthly rent. What percentage is the rent of Bob and Sue's annual income? a. 25% b. 18% c. 33% d. 17%

b. 18%

The FDIC insures depositors up to ___________________ per individual account and per institution. a. $100,000 b. $150,000 c. $250,000 d. $1,000,000

c. $250,000

An appraiser is estimating the value of a house. The sellers want to list for at least $260,000 since it has 4 bedrooms, 2 bathrooms, and a pool. A comparable property recently sold for $235,000 (with 3 bedrooms, 2 bathrooms, and a sun room). In the adjustment process, the appraiser estimates that an extra bedroom is worth $45,000, the pool is worth $4,000, and the sun room is worth $17,000. What is the adjusted sales price of the subject property? a. $202,000 b. $284,000 c. $267,000 d. $203,000

c. $267,000

Title to real estate can be transferred under the terms of all of the following documents except: a. A deed b. A simple will c. A living will d. A living trust

c. A living will

The force of water on land is known as: a. Annexation b. Littoral c. Accretion d. Riparian

c. Accretion

The alienation clause in a mortgage states: a. The loan may not be assumed by another person without lender approval b. The total balance of the loan is due upon the transfer of property c. Only US citizens are allowed to secure the loan d. Both A and B

d. Both A and B

A buyer and seller sign a purchase agreement and within the hour of the signatures the seller is pulled over and charged with DUI for a blood alcohol level of .13. What is the status of the purchase agreement? a. The purchase agreement is void b. The purchase agreement is valid c. The purchase agreement is voidable d. Either B or C

d. Either B or C

A contract cannot be consummated due to a disagreement between buyer and seller. The broker still has the earnest money deposit in his escrow account. The seller demands that the deposit be given to him, but the buyer demands that the deposit be returned to her. What can the broker legally do? a. Immediately give the funds to the seller b. Retain the funds as his commission c. Immediately return the funds to the buyer d. Hold the funds until ordered by the court to disburse

d. Hold the funds until ordered by the court to disburse

The Virginia Residential Landlord and Tenant Act does not apply to which of the following dwellings: a. All residential rentals b. All apartment complexes c. All duplexes d. single family houses when the owner rents 2 or fewer homes

single family houses when the owner rents 2 or fewer homes

Buyer Maximus and Broker Cornelius enter into a buyer-broker agreement. Maximus continues to ask Cornelius to have an open house and get more showings for his property, which doesn't happen even after a month of requests from Maximus. Maximus decides to revokes the agreement. All of the following statements could be true about this action, except: a. Maximus' revocation was justified because Cornelius failed to perform b. Maximus could sue Cornelius for specific performance c. Cornelius breached the contract d. Cornelius owes Maximus for damages

b. Maximus could sue Cornelius for specific performance

A broker manages three separate properties for the same owner. One property is in need of emergency repairs, but there is no money in the management account to cover the cost. The broker "borrows" money from another property's escrow account to make the needed repairs. Assuming he restores the borrowed funds on the next business day, which of the following statements is true? a. The broker is in violation of License Law for improperly handling escrow funds b. Such action by the broker is proper because all properties are owned by the same person c. The broker is required to make the repairs with his own funds, then receive reimbursement from the owner d. The broker acted properly by safeguarding his client's interests

a. The broker is in violation of License Law for improperly handling escrow funds

Which of the following items is a broker NOT required to disclose to a prospective purchaser? a. The property is haunted b. The monthly fee charged by the homeowners' associaton c. The property is subject to seasonal flooding d. The state plans to construct a new highway near the property

a. The property is haunted

Nancy and Kevin enter into a valid sales contract. Nancy makes all the required disclosures, but fails to mention that her home was the birthplace of a famous rock star. Fans trespass the premises on a daily basis because of that history. In fact, this is the reason Nancy decided to sell. How likely is it that Nancy has violated Virginia's disclosure laws? a. Very unlikely, because the events do not physically impact the house b. Very likely, because this will disturb the covenant of quiet enjoyment c. Unlikely, because Kevin may enjoy the attention d. Somewhat likely, because Nancy acted intentionally

a. Very unlikely, because the events do not physically impact the house