Real estate
What form of legal land description uses a plat map?
Lot and block (The lot and black method identifies land by reference to lot and block numbers appearing on maps or a plat map. The lot and block survey system is a method used in densely populated metropolitan areas, suburban areas and suburbs. It is sometimes referred to as the recorded plat survey system or the recorded map survey system.)
Which valuation method or appraisal approach involves comparing a property to other recently sold properties in the same area of similar size and condition?
Market Data Approach or Sales Comparison Approach
There are three different main approaches that appraisers use while they make an appraisal. What are they?
Market Data Approach, Cost Approach, and Income Approach
Local zoning ordinances often regulate all of the following EXCEPT
Market value of property
During the listing agreement a commission of 6% is established. The house is sold for $250,000. What is the commission?
$15,000.00
The EPA requires real estate professionals to give purchasers and tenants of residential dwelling a pamphlet about Lead-Based paint if the dwelling was built before when?
1978
The majority of homes before ___ used lead paint
1978
The majority of homes before _______ used lead paint.
1978
According to the Do Not Call list and Established Business Relationship (EBR) Rules, how many months does a company have to call the consumer if they made an inquiry with the company?
3 months
How many miles does a township contain?
36 square miles (Each square, six miles by six miles, is called a township. Since each township is six miles by six miles, townships contain 36 square miles, each one forming a section.)
Find the annual GRM. A 9-unit building in Cleveland Ohio, with an asking price of $500,000 and gross annual rents of $75,000.
6.66 (Gross rent multiplier = property price / gross rental income. 5000,000/75,000 = 6.66)
A parcel of real property that has an easement over another piece of property is best described as:
A Dominant Estate
A parcel of land that is subject to an easement is best described as:
A Servient Estate
A property owner wishes to build a neighborhood grocery store in an area zoned for residential use. Which of the following would MOST likely be used to obtain permission to build the store
A conditional use permit or zoning variance
Which of the following statements does NOT correctly describe fiduciary
A fiduciary is a neutral third party
Which of the following best describes a balloon payment?
A large payment during the term or at the end of the payment schedule
An example of economic obsolescence in real estate is
A noisy highway built right next to your home.
A buyer wants to be represented by several different agents while looking at various properties. This is an example of what?
A nonexclusive buyer agency (A non-exclusive buyer agency agreement allows buyers to hire more than one agent to find their home; however, buyers must inform each agent they work with that another agent is involved and whether they have shown them specific homes.)
Alienation Clause
A provision in a mortgage requiring full payment of the debt upon the transfer of title to the property, due on sale. Prevents loan assumptions.
The term "Licensee," is commonly used in real estate law. A licensee is just:
A real estate agent
What best describes an agent hired to perform a specific duty?
A special agency
State laws differ on whether a buyer is entitled to know about:
A suicide that occurred in the house last year.
Which of the following best describes Eminent Domain?
A term used to describe the right of the government to takeover privately owned real estate.
What best describes an agency relationship where an agent has legal authority to act on behalf of the principle?
A universal agency
Steve (a real estate agent of five years) was at his local coffee shop with some agents from other offices. The subject of commissions came up, and agents began to compare their commission rates. What should Steve do?
Advise the other agents this could constitute a violation of the Sherman Antitrust Act.
Under the terms in a mortgage, the lender must be paid in full if the property is sold to another person. This is known as the
Alienation Clause
In order for a month-to-month tenancy to be legally valid which of the following MUST the contract include? -Oral or written consent -Offer and acceptance -Consideration -All of the following
All of the following
In order for a month-to-month tenancy to be legally valid which of the following MUST the contract include? offer and acceptance oral or written consent consideration all of the following
All of the following
A buyer and seller entered into a contract, they negotiated the sale of the side lot at the same time as the transfer of the home. What is the second document called?
An addendum
When contracting parties have signed a contract and both parties have done all they promised to do, it is called this:
An executed contract
A property owner enters into a listing agreement with an agent. Another agent obtains a buyer for the house, and the first agent does not receive a commission. The listing agreement between the first agent and the property owner was probably
An open listing.
Which of the following best describes the term "emblements?"
Annual crops produced by cultivation legally belonging to the tenant. (Emblements are annual crops cultivated by a tenant that is treated as the tenant's personal property.)
If a legal description is too long to include in the body of a sales contract, a real estate professional should do what?
Attach it to the contract and make reference to it
Restrictive covenants, are also known as
CCRs
In preparing for variable expenses in a property management budget, the property manager should set up a what?
Cash reserve fund
Fees that the buyer pays to close the deal are called
Closing cost
Title III of the Americans with Disabilities Act (ADA) impacts which type of property?
Commercial and public accommodations
Traditionally real estate agents are paid through a fee paid for performing a transaction called a
Commission
What is the LAST requirement in the process of offer and acceptance that creates an executory contract?
Communication of acceptance
which of the following fiduciary duties continues after a listing agreement expires?
Confidentiality
Which of the following fiduciary duties continues after a listing agreement expires?
Confidentiality (The fiduciary duty of confidentiality lasts forever. Confidentiality requires that you do not disclose any information learned about your clients, their business, financial or personal affairs or motivations. Again, this duty lasts forever.)
If a leased premises becomes uninhabitable deliberately in an attempt to remove the tenant. What is this action called?
Constructive eviction
Which business structure traditionally features a board of directors
Corporation
Which business structure traditionally features a board of directors?
Corporation
Which answer includes 3 actual types of business structures? Choose the best answer.
Corporation, Sole Proprietorship, Limited Liability Company
Appraiser Larry has a set of special-purpose and public service buildings like schools, churches, and post offices, which he needs to appraise. Which approach to value would Larry, the appraiser choose to complete the task?
Cost approach
By which of the following can you not lose title to your property involuntarily?
Dedication (Dedication in property law means the donation of your land. Dedication would be considered voluntary, while the others are all involuntarily.)
Which of the following is a private land-use control?
Deed restrictions
What is the total quantity that buyers are willing to buy at a given time at certain prices?
Demand
Which of the following would NOT apply to the income approach in the valuation process?
Depreciation
If someone is unlawfully forced to execute a contract it is called what?
Duress (Duress is the unlawful constraint or action exercised upon a person whereby the person is forced to perform an act against his or her will. A contract entered into under duress is voidable.)
Which of the following enforces all federal environmental rules and regulations?
EPA
Aaron can't get to his property from a public road without crossing over his neighbor Ron's property. In this situation, Aaron needs a/an:
Easement for ingress and egress over Ron's property.
Enacted in 1974, which of the following is a regulation that aims to give all legal individuals an equal opportunity to apply for loans?
Equal Credit Opportunity Act (ECOA)
What is the difference between the market value of your home, and the amount you owe the lender who holds the mortgage
Equity
An elderly man in a nursing home, has no family and is suffering from Alzheimer's. Because of his Alzheimer's, he doesn't remember much. Eventually, he passes away in his sleep. There is no will for the man, and again he has no family. So what happens to the money left in his savings account and his old farm that has been untouched since he entered the nursing home?
Escheat
Richard is renting property from Becky. Richard is on a month to month lease agreement. This past month he did not pay his rent. Richard's interest would be classified as:
Estate at Sufferance
During your time as a agent you will run into many different types of people from areas across the world. Closing is called many names depending on which region of the U.S. you are from. Which of the following is not a legal name for closing?
Exchange and Transfer
What is it called when parties have fully performed the terms of a contract?
Executed
Generally speaking, what is the most common type of contingency?
Financing or Home Inspection (Home inspection contingencies are one of the most common home buying contingencies. According to NAR, around 80% of homebuyers include a home inspection contingency in their purchase agreement. Financing is right behind it, as it allows the buyer to terminate the contract if they cannot obtain a loan.)
Typically a warranty deed contains how many covenants?
Five to six
Altering a written document by improperly signing someone else's name to an instrument is what?
Forgery
The real estate contract clause that almost always begins with the words "to have and to hold".
Habendum Clause
Earnest money should be deposited into a trust account:
In a timely manner, according to state laws.
If a contract has prepayment penalties, they can be found in which real estate contract clause?
In the Prepayment Penalty Clause
An appraiser has been hired to prepare an appraisal report of a property for loan purposes. The property is a 25-year-old strip mall/ To which approach to value should the appraiser give the greatest weight when making this appraisal?
Income approach
Amendments and addendum are essentially the same thing, correct? Choose the best answer.
Incorrect. An amendment typically changes terms of a contract. An addendum "adds" terms to a contract.
The fifth and fourteenth amendments of the U.S. Constitution permit the government to exercise its power of eminent domain. Eminent Domain is commonly used for:
Infrastructure
What does the Federal Housing Administration do?
Insures loans made by private lenders.
Which of the following best describes the term "encroachment?"
Intrusion on a person's territory or property.
Which type of lien is a claim imposed against a property without the consent of its owner?
Involuntary lien
Which of the following statements is NOT true about radon?
It is a liquid released in soil. (Radon is a GAS not a liquid.)
If a buyer refuses to go ahead with a purchase of property which he has signed a contract, what usually happens to the earnest money?
It is kept by the seller
A lease agreement where the tenant has the right to buy the property within a specified period of time is called what?
Lease Option
When you borrow money to buy real estate, you give the lender a __________ against the property
Mortgage lien
What specific formula would be used to estimate the value of a property using the income approach?
Net Operating Income / Capitalization Rate = Market Value
When, if all, can an executed contract be assigned?
Never. Under no circumstances. (Remember, execution means the contract is closed and cannot be assigned. Only executory contracts can be assigned.)
A property owner enters into an exclusive agency listing with an agent. The seller ends up obtaining a buyer for the house themselves. Is the agent entitled to compensation?
No, because it's an exclusive agency listing.
A seller is asked whether any known plumbing defects exist on her property. She replies that to the best of her knowledge there are no plumbing defects. However, unknown to her the pipes are corroded and due for replacement. Is the seller in violation of her disclosure responsibilities?
No, since she is unaware of the plumbing issue, she is not liable for failure to disclose material defects.
An agent took a listing and later discovered that her client had previously been declared incompetent by the court. The listing is now
Of no value to the agent because the contract is void
Under a lease for a commercial property, a tenant agrees to pay $3,000 per month plus 4% of the gross monthly sales. This type of lease is called a:
Percentage lease
The "time is of the essence" contract clause in real estate contracts generally has to do with what?
Performance
An example of an antitrust violation is
Price fixing
The person who hires or appoints an agent is called the:
Principal
What type of court handles the analysis and transfer of real estate or general estate assets of a deceased person (without a will)?
Probate (Probate is the analysis and transfer administration of estate assets previously owned by a deceased person. When a property owner dies, his or her assets are commonly reviewed in a probate court if they do not have a will.)
A contract that legally binds two or more parties together, to specific obligations, that create a legally binding contract between the buyer and the seller.
Purchase Agreement
Liquidated damage is most likely to be found in which of the following documents?
Purchase contracts
After smoking, this is the second leading cause of lung cancer in the United States. A naturally occurring gas that forms in rocks, soil, and water. A) Radon B) Chlorine C) Lead Paint D) Carbon Monoxide
Radon
What is radioactive gas dispersed from natural decay of mineral in earth (odorless, colorless, tasteless)?
Radon
The cost of public services is distributed among real estate owners through a. personal property tax b. sales tax c. real property tax d. special assessment
Real property tax
The cost of public services is distributed among real estate owners through what?
Real property tax (Property tax is an ad valorem tax assessed on real estate by a local government and paid by the property owner. Public services for real estate owners are paid by real property tax.)
What of the following is required by the Americans with Disabilities Act (ADA)?
Reasonable accommodations must be provided to people with disabilities
What of the following is required by the Americans with Disabilities Act(ADA)?
Reasonable accommodations must be provided to people with disabilities.
Antitrust laws prohibit competing brokers from all of the following EXCEPT
Receiving compensation from both the buyer and the seller.
What form of legal land description consists of principal meridian lines that cover most states in the US, running north to south and baselines running east to west?
Rectangular survey system
A lender's a refusal to lend money to potential homeowners attempting to purchase property located in predominantly minority neighborhoods is
Redlining
D.U.S.T.
Remember DUST and your essential elements of value. Demand: This means the desire to buy and an ability to pay. Utility: The item satisfies a human need or desire; such as shelter, income, or recreation. Scarcity: Limited in supply, as supply diminishes, value increases. Transferability: Able to transfer from one owner to another.
A buyer of a home was not informed that his house was on a septic tank system. The buyer has the right to:
Rescind the contract
An appurtenant easement has several ways of legal termination. Which of the following is NOT a valid way to terminate an easement?
Revocation by the servient owner (Easements are appurentent meaning generally pass along with ownership changes in real estate, but there are several ways of legally terminating them. Expiration, release, merging, and abandonment of the easement are all ways to legally terminate the applicable easement. The servient estate serves the dominant estate and cannot terminate the easement even through revocation.)
Which of the following is an economic characteristic of real estate?
Scarcity
Commingling is the opposite of what?
Separation (Commingling refers to mixing brokers funds with clients funds. The opposite of commingling is separation, which is just separating the funds.)
Real property can be converted to personal property by
Severance (Severance is the opposite of attachment. Severance is taking an item that is attached to the land and removing it as personal property.)
Which of the following situations would a percentage lease be most commonly used in?
Shopping centers (Percentage lease which pertains to commercial real estate. A Percentage lease is a rental that is based on a percentage of the monthly or annual gross sales made on the premises. Percentage leases are common with large retail stores, especially in shopping centers.)
What is the proper procedure for changing a contract that already has become binding?
Sign a separate amendment
Who dictates trust accounts and when to deposit earnest money or other trust funds?
State Specific License Law (Each state determines the rules for brokerage firm trust accounts and how earnest money must be deposited.)
Why is an oral lease for two years not generally enforceable in law?
Statute of Frauds (The statute of frauds is a legal concept that requires certain types of contracts to be executed in writing (real estate included). The statute specifically covers contracts for the sale of land, agreements involving goods worth over $500, and contracts lasting one year or more.)
Which of the following would NOT be covered under a builder's new home warranty?
Structural damage caused by flooding
Which of the following would NOT be covered under a builder's new home warranty?
Structural damage caused by flooding (Weather-related issues and normal wear-and-tear are generally not included in a builder's home warranty. Other items that a builder's warranty may not cover include: Household appliances. Defects resulting from work conducted by the homeowner or anyone else after the builder's work is completed. No warranty covers damages caused by natural disasters.)
Which of the following real estate contract clauses establishes order of priorities of financial claims (liens)?
Subordination Clause
What is the general technique of determining three-dimensional positions of point and the distances and the angles between them?
Surveying
Tina and Tom are two unmarried individuals who own property with equal interests and without a right of survivorship. Which of the following forms of ownership would Tina and Tom most likely have?
Tenancy in common
Who administers real estate law in California?
The California Department of Real Estate (DRE)
CRV stands for Certificate of Reasonable Value and is issued by who?
The Department of Veterans Affairs (Once the appraisal has been performed on a property being bought with a VA loan, the Department of Veterans Affairs (VA) issues a Certificate of Reasonable Value. A Certificate of Real Estate Value documents the price at which a property was sold as well as any unique terms that were added to the transaction prior to its completion.)
Which of the following laws prohibits discrimination in the buying, selling, renting or financing of housing. These laws prohibit discrimination based on race, religion, color, sex, disability, children, nationality and more.
The Fair Housing Act
Who or what determines the amount of an earnest money deposit?
The agreement between the parties
Generally speaking, what happens when the supply of available houses in an area increases significantly?
The average cost of housing goes down
What usually pays the loan origination fee on a Federal Housing Administration (FHA) loan?
The borrower
At the very minimum advertising property or services by real estate professionals, should include what?
The brokerage firms name
A non licensed buyer negotiated the purchase of a house. During a conversation with the seller, the seller agreed to include both the washer and dryer, in the sale, and this was included in the sales contract. In this situation, if the seller takes the appliances, what recourse (if any) does the buyer have?
The buyer may sue the seller for specific performance
Which of the following is NOT a main element of a valid real estate contract?
The contract must have monetary consideration.
In case of a standard tax lien who gets paid first?
The government
Which situation is legal under the Federal Fair Housing Act of 1968?
The insistence of a widowed woman on renting her spare bedroom to another woman
What is the government issued plan to guide the long-term physical development of a particular area?
The master plan. (The comprehensive plan, aka, master plan is a document that is prepared by local government to guide growth and development. It is generally a plan looking 10 to 20 years into the future for the area. These plans can be found at many levels, from neighborhoods, to cities and counties on up to the state level, all across the US.)
To whom does an agent always owe their fiduciary responsibility?
The principal (The principal is always the one whom you have an agency relationship with and therefore is the person whom you owe fiduciary responsibility.)
A bilateral contract is one in which
The promise of one party is given in exchange for the promise of the other party.
Whose obligation is it to disclose potential lead-based paint to buyers of homes built before 1978?
The seller
Which of the following best describes the prepayment penalty clause?
The statement that a lender can penalize a borrower if the borrower pays off the mortgage much sooner than usual.
statute of fraud
The statute of frauds is a common law concept that requires written contracts for certain agreements to be legally binding. The statute applies to land sales and most purchases of goods over $500 (this includes real estate sales agreements).
Servient Estate
The tract of land burdened by an easement.
Typically a trust is a _____ -party relationship.
Three
What type of ownership model is used for vacation real estate in which multiple purchasers own allotments of usage, typically in one-week increments, for the same property?
Timeshare
What is Ginnie Mae's primary responsibility?
To guarantee the security of loans
What is an item on a property that is installed by the tenant and is related to the tenant's business classified as?
Trade fixtures
which of the following contracts would best be described as a contract in which only one party makes a promise to perform an action?
Unilateral contract
Which of the following are the main are the main participants in real estate markets?
Users, owners, renters, developers, renovators, and facilitators
What is the illegal action or practice of lending money at unreasonably high rates of interest?
Usury
The fact that land has a number of important uses is the basis for the element of value called _____.
Utility
An individual seeking to be excused from the requirements of a zoning ordinance needs a
Variance
When a home is purchased using an adjustable rate mortgage or ARM, the monthly loan payment on the mortgage will:
Vary over the life of the loan depending on fluctuations in the interest rate to which the loan is referenced.
What is the difference between void and voidable contracts? Choose the best answer.
Void contracts are not contracts, while voidable contracts have the necessary elements to be enforceable, but can be rejected by one party.
A buyer was negotiating the purchase of a lot to build a new family house, the seller indicated that the land was firm enough to support the construction of a building when, in fact, the seller knew it was not. The contract is?
Voidable by the buyer because of fraud.
Which of the following statements about water rights is true? Choose the best answer.
Water rights are appurtenant. (Water rights are appurtenant, meaning they run with the land and not with the original owner.
Government power is the constitutional authority and inherent power of a state to adopt and enforce laws and regulations to promote and support the public health, safety, morals, and general welfare. Escheat is?
When a property owner dies and leaves no proper documented inheritance plan, the property ownership reverts to the government
Josh agrees to represent Susan in the sale of her home. The listing contract states that Josh will receive a fee of $15,000 from Susan at closing, regardless of the sales price. Is this a legal and a valid form of compensation?
Yes. Compensation can be determined in different ways, as long as the seller and broker agree. (Compensation is negotiated between the broker and the seller and may be transferred and distributed in many ways. As long as the seller and broker agree compensation no matter how much, when, or in any avenue is legal.)
In real estate, a deed is best defined as:
a written legal document by which ownership of real estate is conveyed from one party to another.
When talking about business and professional ethics, as a licensed real estate agent, it is important to make sure:
all clients are treated in the same fair and honest manner.
The owner of a condominium has the use of many facilities there, including a pool. Under the typical condominium arrangement, the facilities are owned by
all the condominium owners in the form of percentage undivided interests.
Which of the following best describes real property?
all things attached to the land and all the legal rights to it.
The best way to determine fair value.
appraisal
An offer to purchase real estate becomes a contract when it is signed by the
buyer and seller.
Fees that the buyer pays to close the deal are called:
closing costs
In the appraisal of a building constructed in the 1930s, the cost approach would be the least accurate method because of difficulties in
estimating depreciation, estimating changes in the cost of construction, and estimating changes in prices of building materials.
Closing is always the ____ step in executing a real estate transaction.
final
Which of the following would be an example of a deed restriction?
house color
According to the Do Not Call list and Established Business Relationship (EBR) Rules, a real estate professional may contact a past client for relationship building purposes when?
indefinitely
What is the document that defines the relationship between the broker and the seller?
listing agreement
Mrs Thompson hired a broker to find her a 100+ unit apartment complex for sale. Upon finding one she liked, she made an offer for $2.5 million to include all the personal property as well. In order to include all the personal property Mrs Thompson needs a/an: A. Investment Unit Loan B. Amortized Loan C. Package Loan D. Balloon Loan
package loan
A legal way to dissolve the relationship when the parties don't voluntarily agree to its termination is called
partition (Partition is a term used in real estate to describe an act, by a court order, to divide up a concurrent estate into separate portions representing interests of the owners of a property.)
The amount borrowed is called the:
principal amount (The amount owed is called the principal and the price of borrowing the money is called the interest.)
Choose the best answer. Which of the following is an example of a Special Use property? sports bar strip club public hospital chuck e cheese
public hospital (Special use properties are properties that are there to "benefit the public," such as: Schools, Hospitals and Police Stations. These properties are described as different, because they are usually designed in a way that cannot fit in a typical zone.)
Commingling is the opposite of what?
separation
Using a trust typically has advantages and disadvantages. One of the main advantages of Land Trusts are:
that the actual property owner can remain anonymous.
Usury
the illegal action or practice of lending money at unreasonably high rates of interest.
Market value is
the price the property is sold for or an estimate of the present property plus future potential. (This just means the actual selling price of the property.)
When you buy real property, you gain several different kinds of rights. One of which are rights called "surface rights." What are surface rights?
the rights to use the surface of the earth.
Which of the following is a common example of real estate police power?
zoning
What is the maximum paid out (per judgment) from the California Consumer Recovery Account?
$50,000 for each transaction; and $250,000 for any one licensee. (Per California License law the maximum paid out of the Real Estate Recovery Fund is $50,000 for each transaction; and $250,000 for any one licensee.)
Which of the following best describes the acceleration clause?
A contract provision that requires a borrower to repay all of an outstanding loan if upon a breach of the contract. (The acceleration clause is a contract provision that requires a borrower to repay all of an outstanding loan if upon a breach of the contract.)
Corporation
A corporation is managed and operated by a board of directors. A corporation has certain rights, privileges, and liabilities beyond those of partnerships.
If a seller rejects a written offer made by a buyer, changes the terms of the offer, and has the new offer delivered to the buyer, it is considered what?
A counteroffer
Which of the following real estate contracts is a service contract?
A listing agreement (Service Contracts are agreements between a customer or client and a person or company who will be providing services. A listing agreement is a service contract between the seller and the broker, or brokerage company.)
What is the test done to locate where to place a septic system?
A percolation test (Percolation is the process of a liquid slowly passing through a filter. It's how coffee is usually made. For real estate, a percolation test is a test to determine the water absorption rate of soil in preparation for the building of a septic drain field or infiltration basin. The results of a percolation test are required to properly design a septic system.)
Which of the following statements is TRUE about trusts and trustees?
A trustee can be an individual or a financial institution such as a bank. (Trusts can be created during an individual's lifetime, or they can be established following someone's death. A trust works as it follows: the first party, the trustor or settlor, transfers a property upon the second party for the benefit of the third party, the beneficiary)
Which of the following two real estate contract clauses protect the lenders in some way, usually by asking for some form of payment(insurance)?
Acceleration Clause and Prepayment Penalty Clause
A property owner acquired the ownership of land that was deposited by a river running through his property by what?
Accretion (In real estate, the increase of the actual land via a stream, lake or sea by the action of water which deposits soil upon the shoreline is accretion.)
The legal principle under which a person who does not have legal title to a property acquires legal ownership based on the continuous occupation of the property.
Adverse Possession (Adverse possession is a legal principle under which a person who does not have legal title to a property acquires legal ownership based on the continuous occupation of the property.)
A real estate contract can be rescinded because of what? Misrepresentation Mistake Fraud All of the following
All of the following
Requires public accommodations to remove barriers in existing buildings such as adding braille markings to elevator buttons, is a requirement of which law?
Americans with Disabilities Act
Johnny is purchasing a house and does not want to purchase all of the furniture that is being left behind. He signs the contract on Tuesday, and on Thursday changes his mind about the furniture. He calls his agent, and they add the furniture to the contract. What is this an example of?
An addendum (An addendum would be drafted to include the furniture he is purchasing, and any additional charge(s) for that furniture. Remember an addendum ADDS terms to a contract. An amendment typically changes terms of a contract. There is a difference, make sure to understand it!)
Mrs. Jane lives in a small residential neighborhood. 100-year-old trees surround her home, and her neighbor Mr. Joe claims the trees are on his property and is planning on cutting them down. Mrs. Jane tries to reason with Mr. Joe, but he refuses to listen. Mrs. Jane files a lawsuit that includes a court order for Mr. Joe to stop his actions until they can work something out. What type of court order is this?
An injunction (If a dispute is pending, the court will likely issue an injunction preventing Mr. Joe from cutting down the trees until they are entirely resolved. Injunctions can be used to protect interests in real property. A court ordered injunction can be used to prevent a harmful action, stop ongoing or repeated conduct, or force a defendant to take action to prevent harm.)
What is a one-of-a-kind contract that is solely between the seller and the buyer. In this arrangement, the seller gives the buyer the option to purchase property at a given price for a set period?
An option contract (A real estate option contract is a one-of-a-kind contract that is solely between the seller and the buyer. In this arrangement, the seller gives the buyer the option to purchase property at a given price for a set period.)
A couple owns an older home in a neighborhood that is becoming a commercial area. Because of the change in the use of the land, the couple can expect the value of their parcel to increase at some future time. This is an example of the principle of
Anticipation (The principle of anticipation in appraisal is the principle that the value of property today is the present value of the sum of anticipated future benefits)
A collection of federal and state government laws that regulate the conduct and organization of business corporations, normally to promote fair competition for the benefit of consumers.
Antitrust Laws (Antitrust Laws are a collection of federal and state government laws that regulate the conduct and organization of business corporations, normally to promote fair competition for the benefit of consumers. In retrospect, antitrust laws protect the consumer and are healthy for a stable economy.)
The increase of value with the passage of time is best described as:
Appreciation
appreciation
Appreciation, in general terms, is an increase in the value of an asset over time. The increase can occur for a number of reasons, including increased demand or weakening supply, or as a result of changes in inflation or interest rates.
What hazardous substance is an odorless, colorless gas that can cause death within hours of inhalation?
Carbon monoxide
A claim that has the appearance of having valid title, but in reality, the person either does not hold actual title, or there is a significant defect in the written documents supporting title, that makes it invalid. This an example of which legal concept:
Color of Title (Color of title refers to a claim to title that appears to be legally valid but may be defective. This legal concept is often discussed in adverse possession claims. If adverse possession is claimed under color of title, usually the claims are met sooner or in an easier fashion.)
What is the procedure used by a public or private entity with the powers granted to take privately owned real estate?
Condemnation (Condemnation is the procedure used by a public or private entity with the powers granted from eminent domain to take privately owned real estate. eminent domain is the right which grants the government to take privately owned land from someone while condemnation is the action of taking that land.)
Constructive Eviction
Constructive eviction is a term used in the law of real property to describe when a landlord sidesteps the formal, legal eviction process, and instead attempts to force the eviction of the tenant by rendering the property uninhabitable. A tenant who is constructively evicted may terminate the lease and seek damages.
Appraiser Leo was hired to prepare a feasibility study for a 12-unit apartment complex in which the owner is considering putting in a swimming pool. Which basic principle of appraising should Leo use?
Contribution (Leo should use Contribution. Contribution is most commonly applied to determine how renovation and property changes may affect the property's overall cost.)
What is the agency responsible for the enforcement of the Fair Housing Act?
Department of Housing and Urban Development (The U.S. Department of Housing and Urban Development's Office (or HUD) administers and enforces federal laws and establishes policies that make sure all Americans have equal access to the housing of their choice.)
An elderly man in a nursing home, has no family and is suffering from Alzheimer's. Because of his Alzheimers, he doesn't remember much. Eventually, he passes away in his sleep. There is no will for the man, and again he has no family. So what happens to the money left in his savings account and his old farm that has been left untouched since he entered the nursing home?
Escheat (Instead of being handed down to his family(since he has none), his assets (farm included) are going to go to the government in the process called escheat. Escheat is the government's right to take ownership of unclaimed real estate or assets.
How often is continuing education required for California real estate licensees?
Every four years (All individuals who hold an active California real estate license are required to complete 45 hours of Commission approved continuing education during each four year renewal period.)
Which of the following can be achieved by dividing the price of the property by the rent that is produced?
Gross Rent Multiplier
A broker's listing on a house expired. The next day it was listed with another broker and offered in the MLS. A week later, a third licensee called the first broker and asked for the key to show the home. The broker should inform the caller that:
He is no longer the listing agent.
A senior housing development may refuse to rent to families if what?
If all units are occupied by people over the age of 62. (In order to qualify for the Fair Housing Act's "Housing for Older Persons" Exemption, at least 80 percent of the units must have at least one occupant who is 55 years of age or older OR all units are occupied by residents over the age of 62.)
This approach determines what the property generates in profit for it's owner or potential owner.
Income Approach
Which of the following is not a type of depreciation used in the cost approach?
Intangible Deterioration (Intangible Deterioration. There is no such thing as intangible deterioration. All the others are forms of depreciation.)
A seller named Joan gave a buyer named Bob an option for thirty days to purchase her property for a consideration of $750. There is no anti-assignment clause in the contract. Which of the following statements is NOT true?
Joan can force Bob to purchase the property. (Joan is the optionor, and Bob is the optionee. And Bob can assign an option if he wants. Joan cannot force to purchase the property. Remember, a seller cannot force a buyer to buy the property with an option to purchase. It's worth noting that they can in a lease to purchase, but in the question, it specifies it's an option contract.)
Holding earnest money without depositing it, is what?
Legal with written authority (Holding earnest money is only legal with written authorization, and even then it's best to deposit it as soon as possible. Having verbal authority is not good enough, and in many states is considered illegal.)
Acceleration is a term associated with which type of document?
Mortgages (Acceleration is a term associated with mortgages. The acceleration clause is a contract provision that allows a lender to require a borrower to repay all of an outstanding loan if payments are not being made or there is a breach of contract.)
Fee packing, equity stripping, and balloon payment abuses are all examples of what?
Predatory lending practices (Predatory lending typically refers to lending practices that impose unfair, deceptive, or abusive loan terms on borrowers. While these practices are wrong, unfortunately sometimes they are perfectly legal.)
As a general rule of thumb ALL written offers must be:
Presented to the seller (As a general rule of thumb all written offers must be presented to the seller. It is a serious breach of a real estate agent's fiduciary duty to the seller not to present all purchase offers.)
Antitrust laws prohibit competing brokers from all of the following except:
Receiving compensation from both the buyer and the seller. (Receiving compensation from both the buyer and the seller is not an antitrust violation. Dual agency is when one real estate agent represents both the buyer and seller in a transaction. While it may seem ideal from an agent's perspective, it can lead to some significant risks, which is why it is illegal in eight states)
Which act amended the comprehensive environmental response, compensation, and liability act (also known as CERCLA)?
SARA ( The Superfund Amendments and Re-authorization Act of 1986 (SARA) was passed when the original act, CERCLA, expired in 1985. It amended the comprehensive environmental response, compensation, and liability act. The big change had to do with liability. When a property owner has been innocent of all involvement with a hazardous waste site, under certain circumstances, he may claim immunity from responsibility. In plain terms it allows truly innocent landowners to have immunity from legal liability. SARA also required EPA to revise the Hazard Ranking System to ensure that it accurately assessed the relative degree of risk to human health and the environment posed.)
California Real Estate Law describes several prohibited practices (Commissioner's Regulation 2780). Which of the following are NOT prohibited practices listed in the regulation? -Discriminating in the terms, conditions, or privileges of sale, rental, or financing the purchase of property. -Representing to any person that property is not available for inspection, sale, or rental when such property is in fact available. -Soliciting sales, rentals, or listings of real estate from any person, but not from another person within the same area because of differences in a protected characteristic. -Selling more than fourteen properties within your six month agent limit.
Selling more than fourteen properties within your six month agent limit. (There is no limit to the number of properties you can sell in California. While the rest of the following are prohibited practices.)
If a court decides a remedy for a seller compelling them to sell the property, it is known as what?
Specific Performance (Specific performance is a legal remedy that binds the parties of a contract to the terms of the contract. Specific performance asserts that parties must perform the exact terms of the agreement as they promised to do when the agreement was made.)
Your client signs a contract to buy a house and the seller refuses to sell the house at the very last minute. Your client still wants the house. What should your client do?
Sue for specific performance (A lawsuit for specific performance would grant your client the house. Specific Performance asks the court to force the opposing party into a contract that binds them to actually perform the contract at issue, rather than award damages for breach of contract.)
A tenant rented an apartment, signing a 12-month lease. After the lease expired, the tenant paid 1 month's rent and got a receipt. What kind of leasehold does the tenant have?
Tenancy at Will
Tenancy at Will
Tenancy at Will is a property tenure that can be terminated at any time by either the tenant or the owner or landlord. It exists without a contract or lease and usually does not specify the length of a tenant's duration or the exchange of payment.
Which of the following real estate contract clauses is typically seen in blanket mortgages and allows for the freeing of all or part of a property from a claim through a proportional or full amount of the mortgage being paid off?
The Release Clause (A release clause is a contract provision (typically in a blanket mortgage) that allows for the freeing of all or part of a property from a claim through a proportional or full amount of the mortgage being paid off.)
The execution date or date executed is the day a contract is signed. The effective date is what? Choose the best answer.
The day the contract goes into effect. In some cases the execution date and effective date are the same.
What is the difference between a lease option contract and lease purchase contract?
The difference between a lease option and a lease purchase agreement is that the lease option only obligates the seller to sell. ( The difference between a lease option and lease purchase agreement is that the lease option only obligates the seller to sell. With a lease option the buyer is not forced to buy the property, if they change their mind or cannot obtain financing. A lease purchase agreement commits both parties to the sale barring breach of contract or the buyer's inability to secure a mortgage.)
Income Approach
The income approach determines how much a property generates income for it's owner, that income, or potential for income. This is used to calculate or identify the market value of the property. The income approach is primarily used for rental properties as not all properties normally generate income.
What is Fannie Mae's primary responsibility?
To maintain an active secondary market for mortgages. (Fannie Mae's primary responsibility is to maintain an active secondary market for mortgages. Ginnie Mae is a government agency that guarantees securities backed by loans issued under other government agency programs, such as the VA and FHA. Fannie Mae, is a private corporation that buys loans from private lenders, assembles them into mortgage-backed securities to maintain an active secondary market.)
The ability to buy and sell is also known as what essential element of value?
Transferability
Which of the following fits the description? "A mortgage loan available for military service members, veterans, and eligible surviving spouses; which often comes with better terms than a traditional mortgage."
VA Loans
A contract agreed to and signed under duress is what?
Voidable (The contract was established under duress, fraud, deception, or coercion making it voidable. A voidable contract is a legal agreement between two parties that may be unenforceable for any number of reasons.)
Researching recently sold homes in the area and homes that haven't been sold in the area and comparing their prices. Is an example of
a comparative market analysis. (A comparative market analysis is an examination of the prices at which similar properties in the same area recently sold)
A married couple intends to purchase property, but only if they can qualify for a mortgage loan at a reasonable rate. The qualification is
a contingency. (A contingency clause is considered one of the most important purchase contract provisions for the potential buyer of real property. A contingency is a future event or circumstance which is possible but cannot be predicted with certainty. So in this instance, the married couple intends to purchase property, but only if they can qualify for a mortgage loan at a reasonable rate. That is a contingency.)
The statute of frauds, applies to
all real estate sales agreements.
A mortgage loan that requires monthly payments of $400.00 for 15 years and a final payment of $20,000. Typically a loan structured like is called a
balloon loan
Complete the statement and make it factually accurate. "In title theory states, banks or mortgage lenders hold the title of a property until it is paid in full. In lien theory states:
banks or mortgage lenders never retain title to the property." (The correct statement is: "In title theory states, banks or mortgage lenders hold the title of a property until it is paid in full. In lien theory states, however, banks or mortgage lenders never retain title to the property." In lien theory states banks or mortgage lenders never retain title to the property. Instead, the mortgage lender holds a lien against the property.)
Puffing is a term referring to
extravagant claims made by sellers in order to attract buyers.
Mortgage points, also known as discount points, are
fees paid directly to the lender at closing in exchange for a reduced interest rate.
Andrew created a life estate on his property for his sister Gabby. Under the terms of the deed, ownership of the property will last until
her death.
A real estate agent advertised a home for $250,000. When a Chinese couple asked the agent for the price of the house. The agent told them the seller wanted $260,000 instead. Under the federal Fair Housing Act of 1968, such a statement is
illegal because the terms of the potential sale were changed for the Chinese couple. (The Fair Housing Act is a law that prohibits discrimination in the buying, selling, renting or financing of housing. These laws prohibit discrimination based on race, religion, color, sex, disability, children, nationality and more. Changing terms of a sale because someone is Chinese is clearly illegal and a violation of The Fair Housing Act.)
Purchase agreements come big and small, and are a crucial aspect of real estate contract law. Which of the following would be an example of a purchase agreement?
ordering something online and checking a box that says terms and conditions.
The purpose of the California Consumer Recovery Account is to enable
people to get recourse of uncollected judgement against licensees. (The Consumer Recovery Account is funded from a portion of the fees paid by licensees. It enables a person who has been defrauded or had trust funds converted by a real estate licensee in a transaction requiring that license, and who satisfies specified requirements (California Business and Professions Code Section 10471 et seq.) to recover at least some of his or her actual loss when the licensee has insufficient personal assets to pay for that loss.)
The California Bureau of Real Estate (CalBRE) conducts its business in order to
protect the public interest. (The California Real Estate Commission administers and enforces the laws of the state relating to real estate activities. The real estate commission conducts its business in order to protect the public interest. Think of the commission like the executive branch of the federal government. The commission is in charge of enforcing California real estate law, while different parts of the government do other aspects like writing and creating laws.)
A buyer was negotiating the purchase of a lot to build a new family house, the seller indicated that the land was firm enough to support the construction of a building when, in fact, the seller knew it was not. The contract is
voidable by the buyer because of fraud.
Compliance with zoning ordinances is monitored through the issuance of
zoning permits (Compliance with zoning ordinances is monitored through the issuance of zoning permits; where the property owner or developer cannot substantially alter the use of the property without getting a zoning permit, which will not be issued unless the proposed development conforms to the zoning ordinance. Zoning permits are usually required before building permits can be issued.)
