Real Estate License Law, real estate exam
The real estate commissioner would not permit which of the following mortgage loan advertisements:
"Call our toll-free number 1 800 FOR A LOAN"
What is the maximum amount that may be ordered paid from the recovery fund to satisfy valid claims against a licensee, for judgments rendered after January 1, 1980:
$100,000
When a real estate licensee negotiates the sale of a mobile home in California, written notice of transfer must be provided to the department of housing and community development within:
10 calendar days
The residential earthquake safety disclosure must be provided to the buyer in a sales transaction involving a woodframe structure, if the home was constructed in what year or earlier:
1960
Fault zones around known earthquake fault lines must be disclosed to perspective buyers of certain properties in California. Typically, these zones are:
A 1/4 mile wide
Which of the following is authorized to manage property for the general public:
A licensed real estate broker
In order to negotiate the sale of an existing promissory note that is secured by real estate, working on behalf of another and for consideration, you must be:
A licensed real estate broker or salesperson
Which of the following is the best example of the practice known as "puffing":
A licensee exaggerates certain features or benefits of a property
One of the following actions, taken in relation to advertising the sale of real property, is considered prima facie evidence by the real estate commissioner in California as being misleading or deceptive advertising. Which one is so regarded:
A misleading map directing prospective purchasers to the site of a property for sale
Collecting rents, fixing up the property, and showing vacant units are the types of responsibilities that would be assumed by:
A resident property manager
A real estate licensee submits a license renewal application, but his name is on a list of obligors who have not complied with a court ordered payment of child support. Which of the following is most nearly correct:
A temporary renewal will be issued, but the licensee must pay the delinquent amount within 150 days
Hopkins wanted to purchase 200 acres of land for future subdivision but did not have the necessary $65,000 cash. He persuaded his friend, Warner, to pay the $65,000 and purchase the land, and Warner then immediately signed a land contract for sale of the property to Hawkins for $88,000. This transaction would be:
A valid purchase and resale
When an agent took a listing she promised the seller that she would advertise the property in the newspaper until it was sold. The agent did not do the advertising that she promised. She is guilty of:
Actual fraud (A promise made without any intention of performing it)
If a real estate licensee misrepresents A property to a buyer while he is acting as an agent, he may subject himself to:
All of the above (disciplinary action by the licensing authority; civil action; criminal action)
Broker Smith took a listing on commercial acreage and also received the right to purchase the property within 30 days. On the 28th day of the listing, the broker decided to buy the property. Before buying the property, he must:
All of the above (disclose any outstanding offers; give the owner any material information; obtain written consent from the owner which acknowledges any profit or anticipated profit)
Which of the following represents a fraudulent misrepresentation by an agent:
All of the above (his representation is an obvious falsehood; his representation is made with a knowledge of the falsehood; his representation caused the aggrieved party to enter into the contract)
A formal declaration, not an oath, that a statement is true or that the declarer will tell the truth is:
An affirmation
Under the terms of the real estate law, a real estate sales person is considered to be:
An employee of the broker
A license to Real estate broker may legally negotiate the sale of:
Any registered mobile home
The total positive balances due to all beneficiaries of a brokers trust fund account must at all times equal the accounts:
Balance
Upon discovering that a sales person in his office was receiving a referral fee from a local lender for every real estate loan the sales person referred to the lender, the broker of record in that office took only two actions: he discharged the sales person, and he warned all the other sales persons in the office never to accept such fees. Based only on the foregoing, which of the following is most nearly correct:
Both broker and sales person may be subject to disciplinary action by the commissioner
When a broker hires a sales person under a valid independent contractor agreement, which of the following is correct:
Broker may be held liable for the sales person's contact in a real estate transaction
When a broker deposits his own personal or business of funds into a client trust fund account, that act is termed:
Commingling
According to the California Bureau of real estate regulations, it is commingling when a broker:
Deposits into the trust fund account a renters check for the security deposit on an income property the broker owns
The maximum commission a broker may charge for the sale of residential property is:
Determined by the brokers contract with his principal
A broker strongly recommends to her sales staff that they use the services of her in-house escrow company and an affiliated mortgage lender, for which they will receive extra compensation. With regard to disclosing this arrangement to clients, the salespersons are only required to:
Disclose the full amount of any additional compensation to be received, and obtain the clients approval
In order to operate a competitive, yet profitable business, a real estate broker needs to be concerned with "desk cost". Which of the following most nearly represents the correct way to calculate desk cost:
Divide the total operating expenses of the firm, including salaries, rent, insurance, etc., by the number of sales persons.
Real estate brokers who own and manage a local real estate office are required to have a written employment contract with:
Each member of their sales staff, including those who have a brokers license that do not have their own office
Under the Alquist-Priolo special study act a subdivider would be required to disclose to potential purchasers:
Earthquake fault lines
It is a requirement that most real estate records be kept for a period of three years, commencing from the date:
Either "B" or "C" above (of the listing agreement, if the sale is not consummated; that a sale transaction closes)
In a published advertisement for real estate, which of the following inclusions is considered adequate notice that the ad has been placed by a real estate licensee:
Either of the above (Bro; Agt)
Broker Hammerman, while exempt from some provisions of the escrow law, is still prohibited from doing certain acts when acting as an escrow agent for a principal. With one exception, doing any of the following acts would probably be grounds for disciplinary action by the commissioner. Which of the following acts would not violate real estate law:
Encouraging a buyer to alter escrow instructions, although such alterations have been initialed by all persons who signed the original instructions
A real estate broker sent all of his title business to wonderful title company. In appreciation of the business, the title company paid the broker $10 for each transaction. According to the real estate settlement procedures act, "RESPA", this practice is:
Forbidden
When a real estate licensee fails to renew a license before it expires, the licensee:
Has two years from the expiration to renew by paying a late fee, but will not be required to take the state exam again.
A person that sold his home and took back a note secured by a purchase money deed of trust. He selected a real estate broker from his telephone book and asked him to service this loan. If the broker takes on this duty, state law requires him to:
Have a written authorization from the holder of the note
If a listing to sell a mobile home expires and is not extended or renewed, how long does the broker have to remove all yard signs and stop all advertising of the mobile home:
He has 48 hours from the termination
If the trust account contains trust funds belonging to more than one beneficiary, the broker may not disperse any funds without the prior written consent of every principal who has funds in the account:
If such dispersal will reduce the balance of the total funds in the account to an amount less than the various owners have on deposit
When the real estate commissioner wishes to rescind approval of a new subdivision, he would likely do which of the following:
Issue a desist and refrain order
Broker Jones, who is not a member of any trade organization, has been using a new advertising slogan: "a new breed of realtor". Concerning this practice:
It is grounds for revocation or suspension of his real estate license
A broker advertise the sale of "Mega bucks trust deeds" in a newspaper. In the advertisement he offers a specific yield which he arrives at by looking at his yield for the past year. Which of the following is true concerning this advertisement:
It is legal if he also gives the actual interest rate specified in the note and the discount from the outstanding principal balance
Broker Knorr advertised in the newspaper that anyone who bought a property listed with the broker would receive a free microwave oven valued at $500 such action is:
Legal, provided full disclosure is made to all interested parties
Owner Armstrong gave broker weeks and exclusive authorization to sell Armstrong's ranch. As part of the agreement, broker weeks agreed to advertise the ranch in a catalog that weeks publishes and distributes to other real estate brokers. For this added service, Armstrong paid broker weeks $1000 for this advertising service at the time owner Armstrong signed the listing. Under current real estate law, this payment:
Must be deposited into a trust account and dispersed only to pay advertising expenditures incurred by broker weeks in advertising the ranch property
Potential buyer Marshall seeks to purchase a home in a new subdivision. A licensee assists Marshall in securing a loan for such purpose from a savings and loan association, explaining to Marshall the loan processing costs that will be involved at closing. Under these conditions, when the loan is arranged, a copy of the HUD booklet, "settlement costs and you":
Must be provided to Marshall by the lender within three days of the loan application
A broker would not be required to maintain trust records in which of the following transactions:
None of the above (not a check promptly delivered to escrow; not a check promptly delivered to the seller; not a check promptly delivered to the seller that was given as the deposit in an offer to purchase containing a contingency clause)
When a broker has two offers on the same property, both from sales people within his office, and both with a deposit, he is placed in a dilemma. He decides not to present the second offer until the first offer has been accepted or rejected by the seller. The seller is not informed of the second offer. The brokers action is:
Not permissible
A real estate sales person's license has been suspended because money was paid out of the recovery account to a person who had a judgment against the sales person. His license will not be reinstated until he:
Pay the recovery account for the money it paid plus interest
Under California law, the real estate commissioner has the authority to do which of the following:
Promulgate rules and regulations to enforce the California real estate laws
Commingle has a meaning of most completely opposite to:
Segregate
Broker Jones had a listing to sell seller Smith's house. Broker Jones received an offer on the house and presented it to seller Smith who hesitated in accepting the offer. The broker promised Smith verbally to find Smith another suitable residence before escrow closed. On the basis of that, the seller accepted the offer. If broker Jones failed to perform during the time period, which of the following is most nearly correct?
Seller Smith could initiate a civil suit and the broker would be responsible for damages
The law permits a real estate licensee to act as an agent in the sale of some mobile homes. All of the following acts are grounds for discipline by the real estate commissioner against a real estate sales person's license, except:
Selling, as agent, a mobile home which is greater than 8 feet in width and 40 feet in length
Broker Davis has had a house listed for sale for nine months without selling it. He knows that the building needs major structural repairs, and he has listed it at 10% above its fair market value. He runs an advertisement in a newspaper that says, "three bedroom, Victorian. You won't believe the price! Move right in. Davis 234-5678." This advertisement is bad because:
Since Davis knows that the property needs major repairs, it is deceptive and misleading
The Alquist - Priolo special study zone earthquake disclosure requirement applies to:
Specific types of structures located in known earthquake fault zones
A licensed real estate broker working under a typical exclusive listing incurs several expenses. He is not entitled to be reimbursed for these expenditures, unless:
Such expenditures were authorized by the principal
Which of the following federal laws requires public accommodations to be made accessible:
The Americans with Disabilities Act
Jones, who does not have a real estate license, is the owner and president of an investment firm. He advertises and sells properties for his clients. Since these transactions involve real estate, who will prosecute him for violating the real estate law:
The District Attorney
A brokers ad in a local newspaper says that if a buyer or seller will bring this ad to his office and either list or buy a property through him, that he will give that person $50. Which of the following is true:
The broker can give $50 to the buyer or seller
A brokers unlicensed assistant prepares a newspaper ad. According to the business and professions code, which of the following is most correct:
The broker is required to read the entire advertisement prior to publication
When a broker receives trust funds and places them in a trust account, which of the following statements is most nearly correct about interest earned on those funds:
The broker may not received directly or indirectly any interest on trust funds
The bank account used by a broker to hold his clients trust deposits must be properly set up in the name of:
The broker, as trustee
A dual agency is legal if:
The buyer and seller consent to it
When budgeting for a real estate office, the phrase "company dollar" means:
The income of an office after all commissions are subtracted
When a real estate licensee advertise properties on the Internet, World Wide Web, which of the following best describes the licensees responsibilities:
The licensee must exercise proper supervision over any non-licensee who responds to inquiries
Which of the following is primarily responsible for disclosure to the buyer of any existing Mello-Roos tax assessment on a parcel of real property:
The seller
The principle difference between the various required natural hazard disclosure and the transfer disclosure statement, TDS, is that:
The seller and or the seller's agent must consult published maps of known hazard areas to detect and disclose relevant hazards, where as the TDS requires disclosure of all known property defects.
Bob, a real estate agent, refers buyers to bug-b-gone termite company, and the company pays him a referral fee for each inspections sold. Which of the following is correct:
This arrangement is prohibited under the real estate law
If a licensee placed the following add in a newspaper which of the following would describe the ad? "Three bedroom, two bath, pool and spa, large lot Dash - $167,000. 555-1234
This is blind advertising
Agent John has given seller Henry an offer that includes the phrase "all kitchen appliances are to be left with the house and become the personal property of the buyer". Henry accepts all of the other terms of the offer, but objects to leaving the appliances. John crosses out that item and initials it on the contract on behalf of the buyers. He does this despite the fact that the buyers are on vacation and cannot be consulted about this. Such actions would most accurately be classified as:
Unlawful conduct
Jesse, and unlicensed employee of a real estate broker, hands out door hanger flyers and makes telephone solicitations, seeking buyers and sellers. Under the real estate law, his activities are:
Unlawful for both Jesse and the employing broker
According to the seller transfer disclosure act, a broker can:
Visually inspect the property and reveal pertinent information
In the parts of California where wood-destroying pests are found, a structural pest control report is required:
When buying residences financed by FHA or VA loans
When a licensee negotiates a loan secured by real property, the licensee must deliver a mortgage loan disclosure statement to the borrower:
When it is signed by the borrower
When is it legally permissible in California to sell property with and "as is" provision in the purchase agreement:
When the buyer is provided with a transfer disclosure statement and informed of all known property defects prior to making an offer.
When renting residential property, the amount of a security deposit which a lessor may legally charge from a lessee is determined in part by which of the following:
Whether the unit is furnished or not
Georgiane Creason is selling timeshares in her wild acres subdivision. She mailed advertisements to 10,000 people, offering them the chance to win a prize, that did not reveal that in order to be eligible, the person must visit wild acres and listen to a sales presentation. All of the prize winners had become owners in wild acre. Is there anything wrong with this situation:
Yes; anyone offering prizes or gifts must reveal any required attendance at a sales presentation when offering the prize or gift
