RE TEST 2 (16-19)

What is a buyer broker agreement?

a) An employment contract

The buyer is in front of a house for sale, and with a cell phone, calls the listing agent. What disclosures, if any, must the listing agent make to this buyer?

a) Any information that you give me at this time is not considered to be confidential.

A man owned his home for five years and when he married, he added his wife's name to the deed. Now they are preparing to sell the home they lived in for the last 25 years. Who must sign the listing agreement?

a) Both husband and wife

What document must be provided to the buyer at the earliest possible time?

a) Consumer Notice

In what type of buyer agency, if ever, is the broker entitled to a commission even if the buyer buys directly from the seller?

a) Exclusive buyer agency

What should the Seller's Property Disclosure Statement reveal?

a) Material defects

Which of the following has formulated a Code of Ethics for real estate licensees?

a) National Association of REALTORS®

In Pennsylvania, what document must real estate licensees present to all prospective sellers?

a) Official Notice

Which of the following is a unilateral contract?

a) Option

The buyers are concerned that they might overpay for the property. What information may their buyer agent provide to ensure that they make the BEST investment?

a) Prices of recently sold properties in the area

The home was built in 1955 and has been owned continuously since then by one couple. Now they are planning to sell it. What must they provide their buyers?

a) Protect Your Family from Lead in Your Home pamphlet

Which of the following actions would be considered legal?

a) Requiring a person with a disability to establish an escrow account for the costs to restore a property after it has been modified

For how long must a real estate licensee retain a copy of the signed Consumer Notice?

a) Six months

Which of the following is an example of dual agency?

a) The broker acting for both the buyer and the seller in the same transaction

The agent has visited the prospective sellers three times hoping to list the property. When should the listing agent present the Consumer Notice to these sellers?

a) The first time the licensee visits the home

Which of the following should be included in the listing agreement?

a) The listing price

At the time that the installment contract is signed, who has legal title to the property?

a) The vendor/seller

Who does the real estate broker represent?

a) Whoever hired the broker

In Pennsylvania, what is necessary in order to be compensated?

a) Written agreement between a real estate licensee and a consumer

In their offer to purchase a home, the buyers stated, "If we cannot obtain a mortgage loan for 5.5 percent or less, we will not purchase the property and we expect that the earnest money will be refunded." This clause is an example of

a) a contingency.

[18] The listing agreement should include

a) a description of the premises.

Before the agreement of sale is signed by both parties, real estate licensees must disclose all of the following details EXCEPT

a) a murder was committed on the property.

A discrimination suit may be filed in federal court by the

a) aggrieved person because of racial discrimination.

An owner enters into an agreement not to sell a property to other interested parties for a specified time in exchange for some consideration, additionally granting a right in the agreement for the property to be purchased on or before the end of that time for a specified price. This agreement is called

a) an option.

A customer may expect all of the following EXCEPT

a) confidential information.

A system of rules and standards that goes beyond the letter of the law is called

a) ethics.

An errors and omissions insurance policy would most likely offer protection against an allegation of

a) forgetting to turn on the burglar alarm after showing the property.

The National Association of REALTORS® Code of Ethics is binding on

a) its members.

The authority to install a For Sale sign on the property is usually included in the

a) listing agreement.

The buyers want to be represented by several different agents looking at various properties. This is an example of

a) nonexclusive buyer agency.

When hired by a management agreement, the broker represents the

a) owner

The Civil Rights Act of 1866 prohibits discrimination in housing based on

a) race.

A lender's refusal to lend money to potential homeowners attempting to purchase property located in predominantly minority neighborhoods is

a) redlining.

A licensee is hired as a buyer's agent by a first-time buyer to help with the purchase of a home. The buyer confides that being approved for a mortgage loan may be complicated by his bankruptcy filing two years ago. The buyer would like to find a seller who will accept an installment sale. In this situation, a correct statement about the licensee's responsibility regarding this information during the presentation of an offer to purchase a property is that the licensee is

a) required to disclose it because it is a material fact—information important to the seller's evaluation of the offer.

A creditor is permitted to refuse to make a loan to an applicant who is

a) too young to legally sign a contract

In Pennsylvania, the broker is providing communication and document preparation services and is assisting both parties in a transaction without advocating for either party. This broker is a

a) transaction licensee.

Which of these meets the HUD definition of family as a protected class?

b) A single parent with a foster child age 12 and a son age 19

After the buyer and the seller entered into contract, they negotiated the sale of the side lot at the same time as the transfer of the home. What is this second document called?

b) An addendum

Which of the following is a similarity between an exclusive agency listing and an exclusive right-to-sell listing?

b) Both give the responsibility of representing the seller to one broker only.

In Pennsylvania, how can a broker guide the seller to an appropriate asking price?

b) Conduct an appraisal

[17] What action is required by the Americans with Disabilities Act?

b) Reasonable accommodations must be provided to people with disabilities.

Which of the following may obligate a buyer client to owe a fee to the real estate agent?

b) Signed a written agency agreement

What is the effect when the buyer and the seller both sign a valid purchase contract?

b) The buyer receives an interest known as equitable title.

Which of the following BEST describes earnest money?

b) The money put up by the buyer at the time the offer is made

A buyer who is a client of the broker wants to purchase a house that the broker has listed for sale. Which of the following is TRUE?

b) The seller and the buyer must be informed and agree to have the broker represent both of them.

In Pennsylvania, when is a written agreement between the broker and consumer required?

b) When the consumer may be obligated to compensate the broker for services

The amount of earnest money deposit is determined by the

b) agreement between the parties.

It is illegal for a lending institution to refuse to make a residential real estate loan in a particular area only because of the

b) physical location of the property.

Statements by a real estate licensee exaggerating the benefits of a property are called

b) puffing.

A broker arrives to present a purchase offer to an invalid, and finds the woman's son and his wife present as well. In the broker's presence, the couple persistently urges the invalid to accept the offer, even though it is much lower than the price she has been asking for her home. If the invalid accepts the offer, she may later claim that

b) she was under undue duress from her son and daughter-in- law and that, therefore, the contract is void.

After a completed application is submitted, the application must be accepted or rejected within

c) 30 days.

An owner wants to know how to determine the best asking price. How does a comparative market analysis (CMA) compare to an appraisal?

c) A CMA contains a compilation of similar properties indicating trends and prices buyers are not willing to pay.

The agency responsible for the enforcement of the Fair Housing Act is the

c) Department of Housing and Urban Development.

Under what situation, if any, may a lender consider age when making a lending decision?

c) If the applicant's income will drop due to retirement

What is the effect of an option?

c) Keeps the offer open for a specified time

Two salespeople working for the same broker obtained offers on a property listed with their firm. The first offer was obtained early in the day. A second offer for a higher purchase price was obtained later in the afternoon. The broker presented the first offer to the seller that evening. The broker did not inform the seller about the second offer so that the seller could make a decision about the first offer. Which of the following is TRUE?

c) The broker has no authority to withhold any offers from the seller.

Which of the following gives the BEST evidence of the buyer's intention to carry out the terms of the real estate purchase contract?

c) The earnest money deposit

The relationship of a broker to a client is that of

c) a fiduciary.

A listing taken by a real estate salesperson belongs to the

c) broker.

The Americans with Disabilities Act (ADA) has the greatest impact on

c) office buildings.

A buyer agrees to buy a property for $230,000 and deposits $6,900 earnest money with the listing broker. However, the seller is unable to clear the title to the property, and the buyer demands the return of his earnest money as provided in the purchase contract. The broker should

c) return the entire amount to the buyer.

A buyer makes an earnest money deposit of $1,500 on a $150,000 property and then withdraws her offer before the seller can accept it. The broker is responsible for disposing of the earnest money by

c) returning it to the buyer.

If a buyer defaulted some time ago on a written contract to purchase a seller's real estate, the seller can still sue for damages if he is not prohibited from doing so by the

c) statute of limitations.

Complaints relating to the Civil Rights Act of 1866 are

c) taken directly to a federal court.

Unless some other written agreement has been made, the broker will usually receive the sales commission from the seller when

c) the transaction is closed.

At what time should a real estate licensee present the Consumer Notice to a prospective buyer?

d) At the first substantive meeting

"I hear they're moving in. There goes the neighborhood! Better put your house on the market before values drop!" This is an example of what illegal practice?

d) Blockbusting

A real estate licensee was representing a buyer. At their first meeting, the buyer explained that he planned to operate a dog-grooming business out of any house he bought. The licensee did not check the local zoning ordinances to determine in which parts of town such a business could be conducted. Which fiduciary duty did the licensee violate?

d) Care

A woman owns a two-unit apartment building and lives in the downstairs apartment. She wants to rent the second floor. She refused the first applicant, an African American male, stating that she did not want to rent to men. A few days later, this man noticed that a white male was moving into the building. The African American male may allege that the woman was discriminating against him under the

d) Civil Rights Act of 1866.

What is the maximum listing period, if any, in Pennsylvania?

d) Indefinitely, so long as the listing automatically renews

Who is responsible for completing the Seller Property Disclosure Statement?

d) Seller

The broker had a listing with a seller who had a heart attack and is in a coma and is not expected to live. In this situation, what is the status of the listing?

d) The agency relationship has been terminated.

By Pennsylvania law, all of the following must receive the Consumer Notice EXCEPT

d) a corporation is selling the property.

Under the Real Estate Seller Disclosure Act, the real estate licensee is responsible for

d) advising the seller of the duty to disclose defects.

A broker has an exclusive-right-to-sell listing on a building. The owner is out of town when the broker gets an offer from a buyer to purchase the building, provided the seller agrees to take a purchase-money mortgage. The buyer must have a commitment from the seller before the seller is scheduled to return to the city. Under these circumstances, the

d) broker must obtain the signature of the seller to effect a contract.

[19] When a prospective buyer makes a written purchase offer that the seller accepts, then the

d) buyer receives equitable title to the property.

A broker did not have enough money in the business account to pay two salespeople, so he wrote two checks out of a trust account. After the next closing, the broker put the money back into the trust account. This an example of

d) conversion.

The Pennsylvania Human Relations Act applies to

d) housing accommodations and commercial property.

Under a typical installment contract, the seller retains

d) legal title.

If, upon the receipt of an offer to purchase his property under certain conditions, the seller makes a counteroffer, the prospective buyer is

d) relieved of his original offer.