PRACTICE EXAM 5
A borrower has a $180,000 loan with an interest rate of 6%. What is the amount paid in interest each month? A900 Dollars ($) B980 Dollars ($) C4,650 Dollars ($) D10,800 Dollars ($)
A900 Dollars ($)
Which of the following does NOT have to be disclosed by a seller or seller's agent when selling a residential property? AA death that previously occurred on the property. BCracks in the foundation. CUncapped natural gas wells on the property. DTermite damage which have compromised the floor structure.
AA death that previously occurred on the property.
What will happen if the government increases the money supply in the economy, but the production of goods and services does not increase at the same pace? AA higher demand for housing BInflation CIncreased job growth DDeflation
AA higher demand for housing
Where does a buyer's earnest money deposit get placed prior to closing on the transaction? AA separate escrow account BThe listing broker's personal bank account CThe seller's attorney's personal bank account DAny bank account within the U.S.
AA separate escrow account
Which of the following loans is associated with monthly payments which fluctuate based on a standard index? AARM BFixed-rate mortgage CTerm loan DBlanket mortgage
AARM
Which of the following is a condensed history of title to a property? AAbstract of title BTitle insurance CDeed DChain of title
AAbstract of title
Which of the following is NOT permitted as a deduction on a homeowner's income tax return? AAppraisal fees BMortgage interest CProperty taxes for a primary residence DProperty taxes for a second home/vacation home
AAppraisal fees
Which of the following is considered an indirect cost? AArchitectural fees BCost of labor CCost of structural wood members DCost of concrete for the building's foundations
AArchitectural fees
The amount of heat required to raise the temperature of one pound of water by one degree Fahrenheit is known...? ABTU BR-value CAmperage DConduit
ABTU
Which of the following is illegal in New York State? ABalloon framing BPlatform framing CPost-and-beam framing DSteel framing
ABalloon framing
Which of the following loan types typically includes more than one property as collateral? ABlanket mortgage BARM CFixed-rate mortgage DTerm loan
ABlanket mortgage
Which of the following refers to the profit realized from the sale of real property? ACapital gain BCredit CCapital loss DDebit
ACapital gain
The actual act of taking private property for public use by the government is known as...? ACondemnation BForeclosure CGifting DEminent domain
ACondemnation
A broker represents a seller in a transaction. If the seller tells the broker they must sell the property quickly due to financial hardship, the broker cannot reveal this information to a prospective buyer. Otherwise, the broker will violate which of the following fiduciary duties? AConfidentiality BObedience CAccountability DFull disclosure
AConfidentiality
Which of the following is NOT one of the four units of concurrent ownership? ADedication BTime CTitle DPossession
ADedication
Which of the following is a payment made by a purchaser of real estate as evidence of good faith? AEarnest money deposit BBuydown CContingency payment DRider payment
AEarnest money deposit
A property owner passes away without any heirs to transfer his/her property. Under the State's power of ..........., the property will revert back to the State. AEscheat BCondemnation CEminent domain DForeclosure
AEscheat
The real estate agent serves as a/an ........to their client. AFiduciary BAttorney CConsultant DGeneral agent
AFiduciary
Which of the following is NOT considered real property? ALiving room furniture BOil or natural gas located beneath the property CVacant land DSmall garage
ALiving room furniture
The borrower in a transaction is known as the...? AMortgagor BGrantor CMortgagee DLessee
AMortgagor
What is the highest court in New York State? ANew York Court of Appeals BNew York District Court CJudiciary of New York DNew York Civil Court
ANew York Court of Appeals
Which of the following recommends zoning changes? APlanning Board BDepartment of Buildings CMunicipal Engineer's Office DZoning Board of Appeals
APlanning Board
When protesting a property assessment, the burden of proof falls on the ..........to prove the assessor was incorrect. AProperty owner BAttorney General CReal estate broker DReal estate attorney
AProperty owner
Which of the following is a naturally occurring radioactive gas, which typically enters a house through the basement? ARadon BCFCs CCardon monoxide DEMFs
ARadon
Which of the following allows a commercial tenant the option to match an offer from another prospective tenant? ARight of first refusal BLease option CClaim DRescission
ARight of first refusal
A common term for an easement is a...? ARight of way BAs of right CPossessory interest DVoluntary alienation
ARight of way
Who determines the commission that a broker will receive in a transaction? AThe broker and seller BThe buyer and seller CThe broker and buyer's attorney DThe seller's attorney and the buyer's attorney
AThe broker and seller
What happens to the salesperson's license if the license of their sponsoring broker is suspended? AThe license of the salesperson will also be suspended. BThe license of the salesperson will be revoked and the salesperson will be required to pay a fine. CThe license of the salesperson will automatically be moved under another sponsoring broker in the firm. DThe license of the salesperson will remain active.
AThe license of the salesperson will also be suspended.
Why is the old deed needed to help prepare for the closing? AThe old deed is used to prepare the new need. BThe old deed is used to determine the amount of insurance on the property. CThe old deed is used to prepare the promissory note. DThe old deed is not needed for the closing.
AThe old deed is used to prepare the new need.
If a broker enters into a listing contract, who is considered the client? AThe seller BThe buyer CThe salesperson DThe customer
AThe seller
This process calculates the value of an asset in the past, present, or future? ATime value of money BRate of return CCapitalization rate DInternal rate of return
ATime value of money
If a clause in a contract is illegal, the contract will be considered...? AVoid BVoidable CValid DSuspended
AVoid
If an investor purchased a property for $1,600,000 with a down payment of 30%, what is the cash-on-cash return if the property produces a monthly cash flow of $4,000? A8 Percent (%) B10 Percent (%) C12 Percent (%) D20 Percent (%)
B10 Percent (%)
ow many years of experience does an individual need as a NYS real estate salesperson in order to quality to obtain their broker's license? A1 year B2 years C3 years D4 years
B2 years
If a woman earns $300,000 in capital gains from the sale of her home, on what amount will she have to pay capital gain taxes? A0 Dollars ($) B50,000 Dollars ($) C250,000 Dollars ($) D300,000 Dollars ($)
B50,000 Dollars ($)
Which of the following is considered a leasehold estate? ASingle family house BCooperative CCondominium DMulti-family building
BCooperative
If the seller's broker in a transaction also serves as the mortgage broker to the buyer, what type of agency is created? AImplied agency BDual agency CGeneral agency DUndisclosed agency
BDual agency
Which structural member is located at the bottom of the building's foundation? ASill plate BFooting CGirder DBeam
BFooting
A property manager is an example of a/an .......agent. ASpecial BGeneral CUniversal DDual
BGeneral
When a real estate investor uses other people's money to increase his/her potential return on investment, they are using...? ATime value of money BLeverage CLiquidity DManaged risk
BLeverage
Which of the following is an example of a uni-lateral contract? AExclusive Right to Sell Agreement BOpen Listing Contract CBuyer Representation Agreement DIndependent Contractor Agreement
BOpen Listing Contract
Which of the following is a vertical wood member used to construct walls? ABeam BStud CJoist DSill plate
BStud
Where should a homeowner look to find the exact dimensions of their property? ABlock and lot map BSurvey CPromissory note DProperty inspection report
BSurvey
A broker and seller entered into an Exclusive Right to Sell Agreement. Who is entitled to a commission if the seller finds a buyer themselves? AA commission is not paid to anyone since the seller found the buyer. BThe seller's broker is still entitled to their full commission. CThe seller's broker is only entitled to a pre-determined flat fee. DOnly the buyer's broker is entitled to a commission.
BThe seller's broker is still entitled to their full commission.
If a tenant wants to throw late night parties in their apartment, what clause in the lease may prevent them from doing so? ARenewal clause BUse provisions CStatute of limitations DTerm of the lease
BUse provisions
If a property is purchased for $350,000 and the buyer needs to obtain a $280,000 mortgage, what is the loan to value ratio of the mortgage? A70 Percent (70%) B75 Percent (75%) C80 Percent (80%) D85 Percent (85%)
C80 Percent (80%)
Which of the following is an example of a conventional loan? AAn FHA-insured loan BA VA-guaranteed loan CA loan offered by a commercial bank without any participation by a government agency DA loan backed by FNMA
CA loan offered by a commercial bank without any participation by a government agency
Which of the following manages a cooperative? ABuilding Association BProperty manager CBoard of Directors DOffice manager
CBoard of Directors
Which of the following written instruments is used to convey a grantor's interest in real property? APromissory note BPlot plan CDeed DMortgage
CDeed
Which of the following is used to account for general wear, tear, and obsolescence of an investment property? AAppreciation BCapital gains CDepreciation DPoints
CDepreciation
An umbrella insurance policy is also known as...? ABasic insurance BDual insurance CExcess insurance DFlood insurance
CExcess insurance
Which of the following interests in real property includes the full bundle of rights? AEstate for years BLeasehold estates CFee simple absolute estates DCooperatives
CFee simple absolute estates
Which of the following types of insurance is also known as 'renter's insurance'? AHO-2 BHO-3 CHO-4 DHO-5
CHO-4
Which of the following creates express agency? ASales contract BLease CListing contract DDeed
CListing contract
The right of a property owner whose land borders on a body of water, such as a lake, ocean or sea, to reasonable use and enjoyment of the shore and water the property borders on is known as...? ARiparian rights BSub-surface rights CLittoral rights DAir rights
CLittoral rights
Which of the following contracts creates a general agency relationship between a property owner and a property manager? AListing agreement BSales contract CManagement agreement DManagement proposal
CManagement agreement
Which of the following values refers to the most probably price a property will get in an arm's length transaction? AMortgage value BInvestment value CMarket value DAssessed value
CMarket value
Income earned from a rental property is classified as what? AActive income BPortfolio income CPassive income DCapital income
CPassive income
If a lender refuses to make a loan on a property based on the demographics of the neighborhood of the property, they are most likely guilty of...? ASteering BBlockbusting CRedlining DTesting
CRedlining
If a real estate salespersons license expires, what must they do to get their license re-activated? ARetake the State exam only BRe-apply for their license only CRetake the State exam and submit a new license application DA real estate salespersons license does not expire
CRetake the State exam and submit a new license application
Which of the following is used to help pay for local streets or sidewalks? ACapital gains BRecovery funds CSpecial assessments DAppropriation
CSpecial assessments
What type of agency gives complete authority over any activity of the principal? ASpecial agency BGeneral agency CUniversal agency DExpress agency
CUniversal agency
Disability was added as a protected class to the Fair Housing Act in what year? A1968 B1974 C1980 D1988
D1988
Which of the following is NOT considered a homestead property? ASingle family home BVacant land of 5 acres CAgricultural land DCommercial property
DCommercial property
A device that melts and opens the circuit, causing electric power to stop when overheating occurs is known as a/an...? ACircuit breaker BAmperage CGFCI DFuse
DFuse
Which of the following estates provides the right of possession and control, but not title? AFee simple absolute BLife estate CFee simple determinable estate DLeasehold estate
DLeasehold estate
A ............. is for the rental of floor space this is not generally divided into rooms. AGross lease BNet lease CLand lease DLoft lease
DLoft lease
Which of the following is a measurement of the ability of insulation to slow the transfer of heat or cold? ABTU rating BAmperage CFlashing DR-value
DR-value
Which of the following allows an insured homeowner to be reimbursed for the actual cost of replacing damaged property? AActual cash value BAssessed value CMarket value DReplacement cost
DReplacement cost
Which of the following building materials is a panel that spans between wall studs and covers exterior walls? AFlashing BFascia CSiding DSheathing
DSheathing
Which of the following forms of ownership is limited to married couples? AJoint tenancy BTenancy in common COwnership in severalty DTenancy by the entirety
DTenancy by the entirety
Which of the following clauses in a commercial lease defines how the tenant can and cannot use the space? ALease duration BSubordination clause CEstoppel certificate DUse clause
DUse clause
The Agency Disclosure Form is NOT required for the sale of which of the following properties...? A1-4 family properties BCondominiums CCooperatives DVacant land
DVacant land
When is a real estate salespersons license required by a property manager? AWhen a property manager works exclusively for one owner. BWhen a property manager is an employee of the owner. CWhen a property manager earns a salary from an owner. DWhen the property manager works for more than one owner.
DWhen the property manager works for more than one owner.
