RE exam wrong questions
What's the term for a charge that either party has to pay at closing? Topic: Real Estate Related Computations and Closing of Transactions Subtopic: Closing Statements Balance Credit Debit Mortgage
A debit is a charge that either party has to pay at closing.
Kenneth entered into a contract to sell his home to Valerie, who put down a $5,000 earnest money deposit. At the last minute, Valerie backed out of the deal, and Kenneth kept the earnest deposit. This is an example of ______. Accepting liquidated damages Accepting partial performance Suing for damages Suing for specific performance
All of the answer options are actual remedies to breach of contract, but in this scenario, Kenneth kept the earnest money, which is known as accepting liquidated damages.
Alluvion describes new deposits of land that are the result of what natural process? Accretion Erosion Exclusion Reliction
Alluvion, or new deposits of land, is the result of the process of accretion.
What types of investors should take into consideration the risk of a holding period? Any type of investor Buy and hold investors only Fix and flip investors only Wholesalers only
Any type of investor No matter what type of investor you're working with—a fix and flip investor, a wholesaler or one looking for long-term appreciation and passive income—it is important for the investor to factor into investment risk a holding period.
What is multiple licensure? A broker who also holds a firm license A broker working at two brokerages An out-of-state licensee holding an in-state license at the same time A salesperson getting licensed as a property manager
Brokers who manage their own brokerage and work at other brokerages must have multiple licenses.
Daniel has several properties listed around town. He receives a call from a prospective buyer who is very interested in one of the properties and wants to schedule a showing. What should Daniel do? Assume the buyer understands that Daniel is the seller's agent. Disclose his agency relationship with the seller to the prospective buyer. Refer any questions about the property to the seller. Schedule the showing.
Daniel must disclose his agency relationship with the seller at the first substantive contact with a buyer. This is a substantive contact.
IRMA helps identify the four tests of a fixture. The I stands for _______. Immovability of the property Indecisiveness of the parties Intention of the parties placing the property Irreconcilable differences of the parties
IRMA helps identify the four tests of a fixture commonly used to determine if it is real or personal property. IRMA stands for: intent of the parties placing the item, relationship of the parties, method or degree of attachment, and adaptation of the item.
Jerry is appraising a five-bedroom home in the suburbs. After identifying the purpose of the appraisal, what does he need to do next? Determine the highest and best use. Estimate the value of the land. Identify the data that is needed. Use three approaches to estimate the value.
Identify the data that is needed. The first step is to state the problem so the appraiser can then identify the data that is needed.
Daniella has invested in an income property and borrowed funds to finance most of the purchase. If interest rates go up, what effect does this have on the value of her property as an investment? Topic: Real Estate Investments and Business Opportunity Brokerage Subtopic: Assessment of Risks It decreases the value. It has not effect on the value. It increases the rate of return. It increases the value.
It decreases the value An increase in interest rates decreases the value of an investment. Daniella will be paying more interest, so the investment yields less.
The economic principle of ______ says that when there are two houses in the same neighborhood with the same size, appeal, and utility, the lower-priced one will tend to sell first. Topic: Real Estate Appraisal Subtopic: Approaches to Estimating Real Property Value Correlation Substitution Supply and demand Under-bidding This is called the economic principle of substitution, which states that the lower-priced option of two properties of equal quality will likely sell first.
Substitution
Margot has fallen in love with a three-bedroom, 2,500-square-foot property in her friend's neighborhood. It's listed for $400,000. However, just down the street, another three-bedroom, 2,400-square-foot home very similar to the one Margot loves was just listed for $350,000. Margot and her agent immediately make an offer on the second property. Which economic principle is at work here? Topic: Real Estate Appraisal Subtopic: Market Value Anticipation Conformity Progression Substitution
Substitution Margot knows paying $50,000 more for a nearly identical substitute property isn't the smart choice.
As a stipulation of a specific act, lenders must offer reasons when rejecting loan applications and must respond to all applications within 30 days. What's the name of this act? Topic: Federal and State Laws Pertaining to Real Estate Subtopic: Federal and State Fair Housing Law Americans with Disabilities Act of 1990 Equal Credit Opportunity Act of 1974 Fair Housing Amendments Act of 1988 Federal Fair Housing Act of 1968
The Equal Credit Opportunity Act of 1974 requires lenders to give businesses and consumers equal access to credit.
Prior to a certain act's existence, there was no legal protection for women who endured sexual harassment from landlords and sellers when they attempted to obtain housing. What's this act called? Civil Rights Act of 1866 Fair Housing Amendments Act of 1988 Federal Fair Housing Act of 1968 Housing and Community Development Act of 1974
The Housing and Community Development Act of 1974 included gender or a person's sex in the list of protected classes.
The Housing and Community Development Act of 1974 added which protected class to federal fair housing law? Topic: Federal and State Laws Pertaining to Real Estate Subtopic: Federal and State Fair Housing Law Color Disability Religion Sex
The Housing and Development Act of 1974 added sex as a protected class, which helped prevent discrimination and sexual harassment for individuals seeking housing.
With a land contract, who retains the title to the property? Topic: Residential Mortgages Subtopic: Other Types of Financing Beneficiary Buyer Seller Trustee
The seller retains the title in a land contract. With a purchase money mortgage, the buyer retains the title.
Which of the following is true about net listings? Topic: Real Estate Contracts Subtopic: Contracts Important to Real Estate The listing agent is guaranteed at least some commission. They don't include compensation for the buyer's agent. They often involve a conflict of interest. They're legal in all 50 states.
They often involve a conflict of interest. Net listings are prohibited in several states, and there's no guarantee of commission. The conflict could occur if the listing agent didn't present offers that left little for a commission, even though the offers met the seller's needs.
Leon and Beth own 1/13 of a timeshare estate. They own weeks 20 and 21, and also weeks 40 and 41. These weeks are inheritable. What type of ownership is this? Topic: Property Rights: Estates, Tenancies; Condominiums, Cooperatives, Community Development Districts, Homeowner Associations, and Time-Sharing Subtopic: Cooperatives, Condominiums, and Time Sharing Estate for life Fee simple Leasehold estate Periodic estate
Timeshare estates are owned as fee simple estates. They convey all rights of ownership and can be sold or passed down to heirs.
To make valid computations of adjustments for the sales comparison approach to value, elements of comparison must be applied in a specific order. Which element is applied first?√ Topic: Real Estate Appraisal Subtopic: Approaches to Estimating Real Property Value Conditions of sale Financing terms and cash equivalency Market conditions Physical characteristics
Financing terms and cash equivalency When using the sales comparison approach, appraisers consider elements in a specific order: financing terms and cash equivalency, conditions of sale, market conditions at the time of contract and closing, location, and physical characteristics.
Your buyer client Heather just signed a purchase agreement for a $520,000 home. The LTVR is 60%. How much is Heather putting down on the purchase? Topic: Residential Mortgages Subtopic: Math - Finance $208,000 $220,000 $300,000 $312,000
A 60% LTVR means that Heather is financing 60% of her purchase and putting down 40%. Forty percent of $520,000 is $208,000 ($520,000 x 0.40).
Which of the following actions occurs prior to closing? A number of contracts are signed by the parties in attendance at the closing, such as the sale agreement, the mortgage loan commitment, and the title insurance contract. The buyer obtains a binder for insurance coverage on the new home. The buyer's check is given to the seller. The seller is paid the balance of the purchase price.
A buyer should obtain homeowners insurance before closing. That way, the property is protected the moment ownership (title) changes hands.
When does the listing agreement between you and a seller client need to be in writing to be enforceable? Topic: Real Estate Contracts Subtopic: Statute of Frauds Always When the term of the listing agreement exceeds one year When you are acting as a transaction broker When you are to be paid a commission
A listing agreement with a term that exceeds one year falls into the category of contract types that are covered by the statute of frauds and must be in writing to be enforceable.
You've committed a per se antitrust violation. Which of the following is true? The violation must have involved market allocation. The violation must have involved price fixing. Your competitor will be forced out of business. Your defense will not be allowed in court.
A per se violation is one where guilt is determined simply by the circumstances; no defense is allowed, needed, or permitted.
What's the permanent marker used primarily for marking datums when measuring elevation? Topic: Legal Descriptions Subtopic: Types of Legal Descriptions Benchmark Monument Point of beginning Sea level
Benchmarks are permanent reference points used for marking datums.
Which of the following statements about an easement appurtenant is TRUE? Topic: Titles, Deeds, and Ownership Restrictions Subtopic: Ownership Limitations and Restrictions It does not involve an adjoining property. It's an encumbrance on the dominant property. It's a permanent right that runs with the land. It's a temporary agreement between two parties.
An easement appurtenant involves adjoining property, and it's a permanent right that runs with the land. The encumbrance is on the servient property.
Which option is defined as the type of hearing that is held in front of the FREC as long as none of the facts of the complaint are disputed? Arbitration Formal Informal Stipulation
An informal hearing is held in front of all of the FREC commission members who did not serve on the probable cause panel, as long as none of the facts of the complaint are disputed.
When the government takes private land for public use, compensation is required. This taking process is known as __________. Topic: Titles, Deeds, and Ownership Restrictions Subtopic: Ownership Limitations and Restrictions Deed restriction Eminent domain Escheat Police power
Answer -Eminent domain Police power is the government's authority to restrict use of private land for public safety, health, or welfare. No compensation is required. However, when private land is taken for public use (e.g., for a road widening), compensation is required.
Which economic principle pertains to how a change in a property affects its value as a whole? Topic: Real Estate Appraisal Subtopic: Market Value Anticipation Conformity Contribution Substitution
Contribution pertains to how a change in a property impacts the value as a whole. Does converting a garage into a family room contribute to or detract from value? The answer to that would be in the eyes of the buyer.
The quasi-judicial powers of the FREC include which of the following responsibilities? Adopt a seal Discipline licensees Enact rules and regulations Foster education of applicants and licensees
Discipline licensees The FREC's quasi-judicial responsibilities include suspending or revoking licenses and imposing administrative fines.
Rhonda and Oliver bought an old schoolhouse with the hope of transforming it into a residence. They owned the property as joint tenants. After Oliver died, how did Rhonda own the building? As a joint tenant with rights of survivorship As a tenant in common with Oliver's heirs In severalty In trust
In severalty When there are only two joint tenants, the death of one dissolves the joint tenancy. Rhonda is now the sole owner of an estate in severalty.
Federal law requires disclosures about what potential hazard in residential properties built prior to 1978? Topic: Real Estate Contracts Subtopic: Contracts Important to Real Estate Arsenic Asbestos Lead Radiation
Lead Prior to 1978, many manufacturers used lead in their paint, which can pose health problems if ingested.
The Perfect Home brokerage firm was found guilty of running deceptive ads. The Federal Trade Commission might require all of the following EXCEPT ______. Topic: Real Estate Brokerage Activities and Procedures Subtopic: Advertising Letters of apology to all affected consumers New ads to correct previous misinformation Notification to consumers about deceptive ad claims Specific disclosures to consumers
Letters of apology to all affected consumers The Federal Trade Commission may require the Perfect Home to run corrective ads, notify consumers of deceptive claims it made, include specific disclosures in future ads, or provide consumers with other information.
When does substantial performance of a contract occur? Topic: Real Estate Contracts Subtopic: Termination of Contracts Both parties fully meet the contract's terms. One or both parties have completed only a portion of the terms agreed to in the contract. One party did not meet the terms of the contract in the specified timeframe and is being required to do exactly what was agreed to in the contract. One party has met most but not all of the terms specified in the contract, and may be required to pay damages for the terms not met. Substantial performance of a contract occurs when one party has met most, but not all, of the terms specified in the contract and may be required to pay damages for the terms not met.
One party has met most but not all of the terms specified in the contract, and may be required to pay damages for the terms not met. Substantial performance of a contract occurs when one party has met most, but not all, of the terms specified in the contract and may be required to pay damages for the terms not met.
Kurt promised his grandmother he'd pay her $200 a month to live in the room above her garage, and she never asked him to put that agreement in writing. He lived there a few months without paying a dime and then disappeared one night after trashing the place. How long does Grandma have to sue Kurt? Topic: Real Estate Contracts Subtopic: Statute of Limitations Five years Four years One year Two years
Poor Grandma! If she does seek damages from Kurt, she needs to do so within four years, according to the Florida statute of limitations for oral agreements. If they had put the agreement in writing, the limit would have been five years.
In Florida, which of the following scenarios is considered a violation of FTC advertising rules? Topic: Real Estate Brokerage Activities and Procedures Subtopic: Advertising Marcy just listed the Brown property with the following description: "2,000 square feet of living space for a total of 2,800, including two outbuildings and an unfinished garage." Sarah has just started her career as a solo agent and decides to try a new marketing campaign slogan: "Come let our team of hard-working agents find you the home of your dreams!" Shelia just closed on the Martin property yesterday. She's taken down all the signs and online listings for it. Vickey posted an MLS listing for the Kennedy property without her principal broker's approval.
Sarah has just started her career as a solo agent and decides to try a new marketing campaign slogan: "Come let our team of hard-working agents find you the home of your dreams!" While it may seem innocent enough, claiming to be a part of a team when you aren't is misleading and deceptive advertising.
The DBPR has issued a cease and desist order to Malika. Which of the following must be true? Topic: Real Estate License Law and Commission Rules Subtopic: Department of Business and Professional Regulations (DBPR) She is a certified public accountant. She is a commission member. She is a real estate licensee. She is unlicensed.
She is unlicensed. The DBPR issues citations to discipline licensees. The cease and desist order applies to unlicensed individuals.
Question 14 Which of these options best describes a sale subject to a mortgage? Topic: Residential Mortgages Subtopic: Methods of Purchasing Mortgaged Property The buyer takes over the seller's mortgage payments and a lender isn't involved. The lender, buyer, and seller create a novation (an entirely new loan). The lender qualifies the buyer, who must apply to take over the mortgage payments. This is a cash-only transaction where the buyer pays off the seller and lender at once.
The buyer takes over the seller's mortgage payments and a lender isn't involved. In a sale subject to mortgage, the buyer simply assumes the seller's mortgage payments. A lender isn't involved.
Which of the following is a risk that the seller assumes when agreeing to a sale subject to a mortgage? Topic: Residential Mortgages Subtopic: Methods of Purchasing Mortgaged Property If the seller's lender learns of the arrangement, the seller will have to pay a fine. In this scenario, the seller must pay an assumption fee. The lender can get a deficiency judgment against the seller. The seller can't use this option if the property was purchased with a VA loan.
The lender can get a deficiency judgment against the seller. If the buyer doesn't make the payments, the lender can sell the house. If the proceeds aren't enough to pay off what's owed, the lender can get a deficiency judgment against the seller.
Question 13 Who usually pays Florida's documentary stamp tax on deeds? Topic: Real Estate Related Computations and Closing of Transactions Subtopic: Math - Computations The buyer The lender The listing agent The seller
The seller or grantor usually pays the documentary stamp tax on deeds in Florida.
You sign a contract to purchase a machine that will allow you to travel back in time and meet Abraham Lincoln. Assuming that time machines don't actually exist (for now), what type of contract is this? Enforceable Unilateral Void Voidable
Void A party can't promise to do something that's actually impossible in a contract. This contract is void because the seller of the machine literally can't perform his side of it.
Your buyer clients Jen and Tony really like the patio set and bedroom furniture in the house you've just shown them. Because the market is hot, what would you advise they do? Topic: Real Estate Contracts Subtopic: Contract Negotiation Ask for the one thing they like best as part of their offer but not the other. Ask for those items and more as part of their offer. Ask for those items as part of their offer. Don't include those items in their offer.
When working in a hot market, many real estate professionals suggest that buyers not ask for personal items.
Xavier deposited a $3,000 earnest money check into his personal account for safekeeping while he was on vacation. The balance in his account when he left on vacation was $4,200, and when he returned, it was $2,800. He withdrew enough funds from his savings account to cover the earnest money check and delivered the funds to the escrow agent. Which statement best represents Xavier's issue? Topic: Violations of License Law, Penalties, and Procedures Subtopic: Legal Terms to Know Xavier is guilty of commingling and conversion. Xavier is guilty of commingling only. Xavier is guilty of conversion only. Xavier is guilty of theft.
Xavier is guilty of commingling and conversion. Because Xavier's balance fell below the amount required to cover the earnest money check, he's guilty of both commingling and conversion, even though he replaced the funds.
As a licensee, you're helping a couple buy a new home when you come across issues that could mean there's a cloud on the title. What should you do? 1 Encourage the couple to move forward with the purchase and not worry about the clouded title. 2 File an affidavit with the court about the knowledge of the clouded title and tell the couple to move forward with the sale. 3 Keep moving forward with the sale but recommend the couple purchase title insurance to insure against any potential title problems. 4 Recommend the couple find another property to purchase, or ask the seller to settle the title through a quiet title action to clear any cloud before moving forward with the sale.
You should recommend the couple find another property to purchase, or ask the seller to settle the title through a quiet title action to clear any cloud before moving forward with the sale.
