Real Estate Course 1 Exam Prep Part 2

A property owner stores commercially used petroleum in a tank on her property. The tank is registered with the Minnesota Pollution Control Agency. What can we reasonably conclude based on this?

The tank is underground and has a capacity of at least 110 gallons.

Which of the following is a benefit of a redeemable ground lease?

The tenant can buy out the lease from the landlord.

Marin was the victim of a Minnesota real estate licensee's dishonest practices. She received a final judgment in court but hasn't been paid, despite going through all legal proceedings, reviews, and appeals. She's seeking recovery from the Real Estate Education, Research, and Recovery Fund. What's the maximum she'd be paid?

150,000

Clarisse is sitting for the Minnesota licensing exam. How many hours of pre-licensing education must she have completed in order to do this?

30 hours

How many acres are in a square mile?

640

Jane found a house she loved that was listed at $345,000. Her offer of $330,000 was accepted, but the appraisal came in at $300,000. Jane plans to finance $275,000. What's the loan-to-value ratio?

92%

Which of the following best describes a lease agreement?

A legally binding, written contract between a landlord and a tenant

______ is a fee that a lender charges for the processing of a loan.

A loan origination fee

In Minnesota, an area where a petroleum leak has occurred is known as what?

A petroleum tank release site

Which of the following could qualify for a Minnesota homestead exemption?

A primary dwelling situated upon 150 acres of land

A licensee wishes to place a sign in the yard of a new listing he's pursuing. What must be in place before that sign hits the ground in Minnesota?

A signed listing agreement

Which of the following provides a summary of the title history?

Abstract of title

Two competing firms are found guilty of illegal market allocation. Which of the following scenarios must be true?

The two firms have agreed not to compete in one another's markets.

You're a buyer's agent, meeting with the buyer and the buyer's lender, Chuck, who is a ______ the transaction.

Third party to

Which of the following describes a manufactured home?

Traditional mortgage financing is difficult to obtain.

A quitclaim deed does which of these?

Transfers without warranty any interest or title the grantor has when conveying it

Which of the following statements best describes how the abstract and Torrens land recording systems are used in Minnesota?

With the abstract system, these actions are recorded with the county. With the Torrens system, actions affecting ownership are registered with the court.

You've just purchased a rural property, and the attorney at the closing tells you, "You have a dominant estate." What does that mean to you?

You'll be using an easement across your neighbor Jim's property.

Which of the following tanks must be registered with the Minnesota Pollution Control Agency?

An above-ground, 1,000-gallon tank that's used to store commercially used petroleum

You're trying to locate the northwest corner of a recently surveyed 10-acre property you will be listing for sale. The deed tells you that this corner is marked with a monument. What are you looking for?

An iron rod with a surveyor's cap

Which of the following is true about the statute of frauds?

Any form of written contract, including email communication, may be considered "in writing" and binding.

Which document establishes path and proof of ownership?

Chain of title

Justin is representing the seller in a transaction. Which of the following tasks is he permitted to perform for the unrepresented buyer as a non-agent?

Explain to a buyer the purpose of the seller's property disclosure.

Terry represents seller Farrah, and Michael represents Troy, the buyer. Who is (or are) the principal(s) in this transaction?

Farrah and Troy

In Minnesota, the floodplain consists of the floodway and the _______________.

Flood-fringe

Which method of involuntary alienation involves a lien holder forcing the sale of the owner's property in order to generate the funds with which to satisfy the lien?

Foreclosure

What is a code of ethics?

Guidelines for conduct

Which of the following is a possible title issue with a real estate owned transaction?

Internal audit delays

You're a Minnesota licensee hosting an open house at your colleague's listing while she's on vacation. A visitor at the open house asks several questions about the house, and you answer them without mentioning that it's not your listing. Why is this a problem?

It's a misrepresentation of your status.

Which of these statements is NOT true about a specific lien?

It's always involuntary.

Robert is the general contractor for a home being constructed in a new development. The foundation has been poured, and he's working with the homeowners to make some decisions that weren't identified in the blueprints he's working from. Which of the following details are guided by local building codes?

Number and type of electrical breakers

Your buyer client, Percy, wants to start searching for his dream house and knows he needs to obtain financing to accomplish that. What's his first step?

Obtain a pre-qualification letter.

Brandon has a right-to-use timeshare. What can he NOT do with this type of timeshare?

Pass the timeshare on to an heir.

Commercial lenders operate in the _____mortgage market, making loans directly to consumers.

Primary

What type of ownership interest needs to be disclosed in writing to all parties?

Property held directly or indirectly by the licensee, the licensee's immediate family member, the licensee's firm, or a member of the licensee's firm

A RAM is a type of equity financing. What does RAM stand for?

Reverse annuity mortgage

Greta is working with agent Brandon to sell some property. Nelson represents the buyer, Rigby. Of these four parties, who will pay the earnest money?

Rigby

What language may be included in a contract after the assignor's name to make it clear that the contract is assignable?

"And/or assigns"

Clint is interested in making an offer on a house with hardwood floors that will need to be replaced. The hallway is 18' x 6'. The kitchen is 20' x 30'. The living room is 25' x 45'. There are two bedrooms, which measure 12' x 16' each, plus a master bedroom that is 14' x 20'. If the cost of the flooring is $5.48 per square foot, and the cost of installation is $1.49 per square foot, how much can Clint plan to spend to replace the floors?

$17,404.09

You've just helped Maribella and Antonio Vega purchase a new home. Which of the following should be recorded to ensure that someone else doesn't try to claim ownership of the same property?

Deed

In situations where no will exists, the deceased person's estate's assets are distributed according to the law of __________________.

Descent and distribution

LaTonya's aunt left her a bungalow on the outskirts of the city. For many years, it was the place for family holiday gatherings, and LaTonya's sister was even married there. That's why her family is so upset to learn that she plans to sell the bungalow as soon as she gets it cleaned out. Which real property right allows her to sell the property?

Disposition

What must you do to convert a fraction to a decimal?

Divide the top number by the bottom number.

Lenders are more comfortable when borrowers have around 20% of the property's purchase price to serve as what kind of payment?

Down payment

Oscar is a buyer in Minnesota who provided a promissory note to his real estate agent as earnest payment. Did his agent violate license law by accepting this as earnest payment?

No, as long as the licensee deposited the item with an authorized escrow agent.

Is it a good idea for a licensee to buy a property listed by their employing broker?

No, the licensee may put their own interests before those of the client.

Eminent domain is the governments' power to take private land for public use. What is it called when the government actually seizes someone's property?

Condemnation

Which of the following elements is always required for a real estate contract to be valid?

Consideration

In which method of involuntary alienation does a court decide how the proceeds from the sale of land owned by tenants in common will be distributed?

Court-ordered partition of property

An unrepresented ______ who's a party to a transaction is known as a principal.

Customer

Jameis is a landlord in Minnesota who charged a screening fee to each of these applicants. Which of these applicants' screening fees is Jameis required to return?

Kenneth was screened and rejected due to a reason not listed on the screening fee disclosure.

Lead is a highly toxic metal that may cause a range of health problems, especially in young children. Which one of the following is a true statement about lead hazards?

Lead may cause behavioral problems, learning disabilities, seizures, and, in extreme cases, death.

What could be a consequence if there were no secondary mortgage market?

Lenders might not have funds available to make new loans to the public.

Property owners who live on or next to water have certain rights. An example of one of these rights includes ______.

Littoral

A community that undertakes a comprehensive master plan is ______.

Taking the first step in urban planning

Who should review the settlement statement before closing?

The buyer and the seller

Lauren had a listing agreement with Florence, a Minnesota real estate broker. After Lauren's agreement with Florence ended, she re-listed her home with Jamal and sold the property within two months. Florence is seeking compensation from Lauren because the property sold to a buyer that showed interest when the property was listed with Florence. Which of the following could allow Florence to receive compensation?

The buyer's name was on the protected list provided to Lauren two days after contract expiration. The contract included a three-month override clause.

Which of the following is a potential disadvantage for a buyer who enters into a lease with an option to buy contract?

The buyer/lessee could lose any funds credited to the purchase price if he breaches the lease's terms.

Amanda leases a unit in a building that Elroy owns in St. Paul. They have a signed, written lease agreement between them. Which of the following MUST be true?

The lease is for a unit in a building that has at least 12 residential units.

Rachel is talking with a co-worker, Shawna, about homebuying. Rachel shares some general market trends and talks about the impact of rising interest rates. She notes that the listing price of Shawna's neighbor's house seems lower than it should be, and then they talk about the importance of getting pre-approved for a loan early in the process. Which of her statements might have created an implied agency situation?

The listing price of the neighbor's property