Real Estate Post-licensing Course - Unit Exams
Qualifying broker Nikolaus just explained the brokerage's agency disclosure office policy to his newest licensee, Rudolph. Rudolph acknowledges his receipt and understanding of this policy in writing. For how long must Nikolaus retain a copy of this acknowledgment?
3 years
Under Alabama law, real estate professionals ______ technology like Skype or FaceTime during negotiations.
Are allowed to use
Active listening involves ______.
Giving your whole attention to the speaker
Johnstone's Realty is a new discount, menu-based brokerage firm. Its approach usually results in a lower listing commission rate than other firms offer. Johnstone's also offers a lower cooperating brokerage split than most other firms. Business is booming for Johnstone, and the remaining firms in town are concerned. These brokers agree to not show Johnstone's listings to their buyer clients. What is this an example of?
Group boycotting
Alabama broker Harry tells his client, Samantha, that the cracks in the foundation of the property she's buying from Bruce are "normal" and "nothing to worry about." Bruce doesn't know Harry has said this. Shortly after Samantha moves in, the basement floods, and after having the foundation examined, she learns it's in terrible condition. Which of the following is true of this situation?
Harry has misrepresented the facts of the property. He can face disciplinary actions from the commission.
Alabama broker Holly fails in her duty to provide the parties with copies of the purchase contracts they sign. Which of the following penalties can the commission impose?
License revocation or suspension
Katelyn really wants to include an inspection contingency in her purchase offer. Her agent explains that the inspection contingency will document which of the following?
The date by which all inspection issues must be addressed
Cheryl is feeling very cranky today. Her client refused to sign an offer to purchase because the seller wouldn't include the kitchen appliances in the sale. What has Cheryl failed to do?
Understand the needs of her buyer client
What's an effective pricing strategy when listing a home in a cold market?
Price the home below market value.
Among other items, which of the following property details can be verified online without previewing a property in person?
Proximity to schools
In which of the following types of financing does the seller hold a mortgage from the buyer for some or all of the purchase price?
Purchase money mortgage
The Hendersons don't have enough money to make the full 20% down payment their lender requires. To close the sale, the seller is willing to finance a loan for the gap between their down payment and the amount the institutional lender is willing to loan. What's this type of financing called?
Purchase money mortgage
What type of arrangement allows the buyer to retain title to the property but places a security interest in the property on behalf of the seller?
Purchase money mortgage
Which type of mortgage is seller financing in which the buyer gives a mortgage to the seller toward the purchase price, and which buyers use as down payment financing?
Purchase money mortgage
The acronym RECAD relates to what act in Alabama?
Real Estate Consumer's Agency and Disclosure Act
Which of the following options is something that you would only do for a buyer client and not a buyer customer?
Suggest an earnest money amount based on the practices in your area.
You're working with Angela, your buyer customer. Since there's no agency relationship in place, it's important for her to understand which of the following?
You represent the seller.
When one party to a contract transfers her rights and obligations under the contract to another, with the original party remaining liable, it's called ______ of contract.
Assignment
Alabama licensee Blair provides the parties with copies of their signed purchase agreement more than a week after they've signed the agreement. Which of the following penalties can the real estate commission impose for her failure to provide the paperwork with reasonable promptness?
A fine of between $100 and $2,500
A buyer, hoping to beat out all other offers, included a clause in the offer that reads, "Buyer to beat all competing offers by $1,000 up to a price of $700,000. Seller to provide copies of competing offer to buyer on acceptance." What type of offer is this an example of?
Escalator
Licensee Jake wants to form a transaction brokerage agreement with seller Emmy. Whose approval does Jake need to form this relationship?
His broker's
Rescission, suit for specific performance, liquidated damages, and acceptance of partial performance are all ______.
Options a wronged party has to remedy a breach of contract
Nancy wants to be able to read her clients better. Which of the following are ways she could do this
Pay closer attention to verbal and non-verbal cues.
Which of the following statements is true regarding a partially performed sales contract that otherwise contains all of the essential elements?
The contract is voidable.
How does discrimination testing work?
Two different applicants whose only difference is protected class apply for the same property.
"What's the difference between a fee and a proration?" your client asks. What should you tell him?
"A fee is a lump sum you pay for a service, such as for getting a loan, and a proration is a payment based on how long you use a particular service."
When it comes to building relationships with the people in their database, what tip could real estate licensees take from politicians?
"Press the flesh" (have in person meetings).
Working on one's business, as opposed to working in one's business, means that ______.
Business development activities are occurring
The most effective prospecting involves ______.
Consistency
______ are related to Alabama's real estate transfer tax.
Documentary stamp tax
Which of the following is true about errors and omissions insurance?
It covers licensees sued by consumers for inadvertent mistakes.
Under the statute of ______, if legal remedy is sought against a person, the pursuer must bring a court action within a specified period of time
Limitations
Good record retention is one way to ______ risk.
Manage
Natasha has been working her farm area and is starting to see results. She finds that her efforts are most efficient and effective when she sends out her newsletter to the contacts in her farm area on a ______ basis.
Monthly
Among other items, which of the following property details can be verified online without previewing a property in person?
Neighborhood information
What is the key difference between the assignment and novation of a contract?
Novation releases the original party from all obligations while assignment does not.
Cyberattacks are ______.
On the rise
______ email scams are designed to steal money.
Phishing
Trudy loved her new neighbors. The investor couple was buying up every house they could on Trudy's block, and working hard to renovate them and increase their value. Trudy decided that she'd sit back, relax, and let her property's value go up too, thanks to ______.
Progression
Which of the following is a good technique when prospecting expired listings?
Provide market data.
Rochelle has a database she loves to mine. How often, at minimum, should she set up an in-person meeting with each member of her database?
Quarterly
______ is naturally created when the gas in rocks and soil decays, and can cause cancer.
Radon
Alabama qualifying broker Sam must disburse the funds he's holding to the appropriate parties within ________ of the parties' agreement.
Seven business days
The ______ is the federal act dealing with telephone solicitation.
Telephone Consumer Protection Act
What is a SWOT analysis useful for determining?
The strengths, weaknesses, opportunities, and threats facing a business
Which of the following does encryption do?
Turns information into indecipherable code.
Which of these is the most current and secure method for protecting a wireless network?
WPA2
Dawn is a real estate licensee working with Midge, a buyer. If Dawn were trying to explain the advantages of a buyer representation to Midge, what could she say?
"Without a written representation agreement, I don't represent you."
Your buyer client Tyrone asks you, "I want to make sure that this house I'm buying doesn't have anything major wrong with it, so I don't get stuck with expensive repairs in a year or so. Is that possible?" How should you answer him?
"You will pay inspection fees outside of closing; this inspection is to make sure the house is in good shape."
A typical licensee can expect to pay approximately ______ each month in ongoing business expenses.
$200 to $1,000
Kris Kringal is purchasing his first house: a ranch in Birmingham. The house was listed at $270,000. The purchase price is $250,000. Kris is putting down $30,000 ($20,000 of that was a gift from his parents), and has taken out a mortgage on $220,000. On which amount will he be assessed the Alabama mortgage tax?
$220,000
Licensee Leo is found guilty of giving false information to a consumer. What's the maximum fine the Alabama Real Estate Commission can impose?
$2500
What's the maximum per-email fine you can be charged if you violate the CAN-SPAM Act?
$41,484
Two neighbors agree to equally split the cost of installing a chain link fence on a 2,880-foot boundary between their properties. How much will each neighbor owe if the chain link fence costs $6.04 per foot?
$8,697.60
What's the estimated value of a 3,240-square-foot home that's comparable to one with a price per square foot of $285?
$923,400
Carmen has written her mission statement for her brand new brokerage. She is now ready to establish goals. How many goals are reasonable for her to set?
1
What does the principle of substitution say?
A buyer won't pay more for a property if a similar property is available at a lower price.
Which option represents a physical condition of the property that would be disclosed?
A crack in the foundation of the property
Which of these principles of value is related to how a change to a portion of a property impacts the value as a whole?
Contribution
What are the primary types of financing available to a buyer?
Conventional, VA/FHA, and assumable mortgages
What should brokerages do with regard to using social networking sites to market real estate?
Create policies and procedures that address proper social networking use.
A(n) ______ is a hacker's attempt to do harm to or destroy a computer network.
Cyberattack
Licensees demonstrate ________________ when they can change course and adapt to various individuals and situations.
Flexibility
Sam wants to be a better listener. Which of the following are ways he could do this?
Give 100% of his attention to whomever is speaking.
What can brokerages do to ensure licensees use technology properly?
Have a solid policies and procedures manual in place.
What's Alabama licensee Jake's duty to his seller client?
He must fulfill all his lawful obligations in the agency contract.
Alabama broker Jim is acting as a dual agent for seller Christine and buyer Blake. Which of the following is required for Jim to act in this capacity?
He must get the written, informed, advance consent before entering into the relationship.
Inconsistent temperatures from room to room is a common ______ problem.
Heating and cooling
Dennis is a new licensee who's estimating his annual gross income for his first year. He plans to close at least five transactions that year, and he's researched average home prices in the area where he'll be working. Dennis finds that the average sale price is $280,000. What other data point does he need to complete his estimate?
His expected commission rate, minus his broker's split
Which of the following tasks would require a real estate license?
Host an open house
The MLS is a good source for data when researching a subject property. What information will you find there?
How long it took to sell last time
Pamela is your seller client. Which motivating factor would impact pricing strategy when performing a market analysis for her?
How soon Pamela needs to sell
"Without a written representation agreement, I don't represent you."
How we say it
Which of these situations represents the illegal practice of redlining?
Hunter, a mortgage broker, refuses to underwrite mortgage applications from applicants who are buying in specific neighborhoods.
Which of the following may cause the Loan Estimate to be revised?
Interest rate change, switch to fixed-rate loan, down payment amount change, and property appraisal reveals increase in value
Alabama's consumer information booklet can replace the Real Estate Brokerage Services Disclosure form in which situations?
It can never be used to replace the disclosure form.
Which offer would be the most appealing to a seller?
It depends on the needs and motivations of the seller.
Licensees are required to relate all information that's material to the transaction to their clients. How does this relate to presenting offers to the seller?
Licensees must present and explain all offers.
Which of the following statements is true regarding the Alabama Real Estate Brokerage Services Disclosure form?
Licensees should ask, but not require, that consumers sign to acknowledge its receipt.
Which of the following ongoing fees would a licensee expect to pay on a quarterly basis?
MLS fee
_________ is software intended to damage or disable computers and computer systems.
Malware
Errors and omissions insurance is an important way to do what?
Manage risk
Retaining paper and electronic records of transactional documents for the time period prescribed by your regulating authority helps to ______.
Manage risk
Which of the following statements about fees paid at or near closing is true?
Many closing costs can be negotiated between the buyer and seller.
Margie is selling her condo in Tuscaloosa. What's her responsibility regarding property defects?
Margie must disclose any defect that she knows could pose a health or safety risk to the buyer.
Rupert is a licensee preparing for a listing appointment. He'll use an analysis of ______ to create a strategy when setting a list price.
Market indicators
What does a CMA determine?
Market price range
Becky is speaking to a group of licensees about the importance of listening skills. Which of the following is a true statement?
Most of our communication consists of body language and voice quality.
Kendra enters a contract to sell her home to Madge. After the inspection, Madge insists that Kendra replace the roof, which is damaged. Kendra refuses, and the parties agree to cancel the deal. This is an example of ________.
Mutually rescinding the contract
Edgar is eager to sell his property because he's moving to another state for his job. Can his agent share this information with the buyer to speed up contract negotiations?
Only if Edgar authorizes the agent to do so; otherwise, the agent owes Edgar the duty of confidentiality
Under which types of agency agreement may a buyer and agent operate?
Open, exclusive right to represent, and exclusive agency
Licensee Dionne pointed out to her buyer client which items in the house she was showing would be considered real property. One of the key determinants, she explained, was whether the item was ______.
Permanently affixed to the property
According to the U.S. Department of Justice, which type of antitrust violation is an agreement between competitors to set contract terms for a certain length of time?
Price fixing
Which of these choices is an example of a listing agent negotiating on a seller's behalf?
Reviewing offers and explaining any special requests or requirements
Cicely is getting ready for her listing presentation to the Maxfield family. She's eager to have them sign on with her, and she's spent hours preparing all of the elements for the presentation. What information should be included in Cicely's marketing plan?
An outline of ways to promote the property
The economic principle known as ______ means that the value of property today is impacted by the current value of the total expected future benefits.
Anticipation
What information about a property is the licensee required to disclose to potential buyers?
Any material, adverse information that the licensee has actual knowledge of concerning the physical condition of the property
April and Wayne are the buyer and seller of a condo, respectively. April is represented by Steve. Wayne is represented by Wanda. Name the principal(s) in this transaction.
April and Wayne
______ is the method firms use to determine what risks they face.
Risk identification
Which of the following is a reason all licensees should have errors and omissions insurance?
Risk is an inherent part of real estate activities.
Which type of contract allows a buyer to legally possess the property after all of the terms and conditions have been met?
Sale agreement
Which marketing avenue is most successful in building a referral-based business?
Sphere of influence
When performing a market analysis, which of the following factors would require an adjustment to a comparable property?
Square footage differences
Kendra has applied for a loan from Acme Savings and Loan, but when she compares the Loan Estimate the loan officer gave her with the one from Best Bank, where she also applied for a loan, she decides she'd rather go with the loan from Best Bank. Which of the following is a true statement about this situation?
The Loan Estimate expires in 10 business days if Kendra doesn't tell Acme Savings and Loan that she wants to move forward with it.
Irene and Harold are buying a home. Which document will be used for this transaction?
Sales contract
The number of houses sold over a period of time is reflected in ______.
Sales volume
Disposal of electronic information requires it to be properly ______.
Sanitized
What responsibility does the seller's agent have to the seller?
Seek a sale at the best price at terms acceptable to the seller.
Who has an obligation to be knowledgeable about the real estate market conditions and property pricing for the seller client?
Seller's agent
Joe is an unlicensed real estate assistant. Which of the following acts can he complete?
Set up showing appointments
Alabama broker Sarah represents buyer Alice, who's making an offer on a home in Montgomery. Sarah prepares, and presents Alice with, a closing statement with her estimated closing costs. What else must Sarah do?
She must obtain Alice's signature acknowledging her receipt of the estimated closing cost statement.
What strategy will help protect hard copy information?
Shred all printouts before disposal.
______ are the easiest targets and yield lucrative results for scheming thieves.
Smaller businesses
Comparable properties are properties that have ______ recently and are similar to the subject property in terms of location, size, number of bedrooms and bathrooms, features, and age.
Sold
Marla's excited about closing on a cute lakefront cottage. But while talking to one of the property's neighbors, she learns that the chimney leaks and that the owners have had water damage at least twice. This wasn't on any of the seller's disclosures. Which of these is the best option for Marla?
Terminate the agreement and ask for a refund of her earnest money.
Among other things, a listing in the MLS should always include ______.
At least one photo
When does the seller's broker receive commission?
At or just after the closing
Jennifer's firm prohibits licensees from willfully engaging in dual agency transactions. By implementing this policy, her firm is ______.
Avoiding risk
When performing a market analysis, given the adjusted sales prices of three comparables, which comparable would you weigh most heavily?
The one that required less adjustment
What type of database program is best for keeping track of your sphere of influence?
The one you'll consistently use
Brandon wants to find out how many rental units are unoccupied in his area. Which market indicator provides this information?
Vacancy rates
With a land contract, who retains the title to the property?
seller
______ is an example of a weak password.
starwarsfan
Someone who's been given the authority to act on behalf of someone else is a(n) ______.
Agent
How will the buyer or seller know where and when the closing is being held?
Agents are responsible for ensuring their clients know where and when the closing's being held.
Can you recognize which of the following is identity theft?
Alex's credit card number was copied at the gas station and then used to pay for the thief's own gas.
Small business owners are most concerned about protecting ______.
All forms of confidential and sensitive information
In real estate, work-related tasks fit into one of two categories: business building and ______.
All other tasks
Which statement is true regarding how a face-to-face closing is conducted?
All parties are present and physically meet to sign and exchange documents.
Which of these landlord policies is discriminatory?
All residents must show a U.S. birth certificate as part of the application process.
Buyer Daphne and seller Kurt signed a sales contract with a definite closing date of May 15. Daphne now finds that she needs to move the closing date to June 15. She'll accomplish this with an ________ to the sales contract.
Amendment
Who at the closing table examines all documents for buyers or sellers and represents their best interests?
Buyer's or seller's attorney
Roberto is developing his mission statement. It should ______.
Define his company's objectives and approach to meet those objectives
You received an email telling you you've won a customer appreciation prize in a store where you've never shopped. You're asked to contact them immediately. What do you do?
Delete the email.
Which of the following statements describes a business goal?
Derived from the company's mission statement
Sally is developing a vision statement for her business. This statement should ______.
Describe the desired future position of her company
Which task is NOT the responsibility of an escrow officer?
Determine how earnest money is to be distributed in case of a dispute.
When you provide a well-researched comparative market analysis to your seller client, it benefits your client by ______.
Determining an appropriate list price according to market and property condition
Alabama real estate agents selling property as For Sale by Owner must _____
Disclose they are a licensed real estate professional
Why does discrimination still occur, even when it's illegal?
Discrimination is often not visible to the public.
Evan has his home and cell number on the Do Not Call Registry. He received an unwanted solicitation call from a new real estate licensee in the city. He told the licensee his number is on the Do Not Call Registry and that he does not wish to do business with the licensee. A few days later, he got another unwanted call from the licensee. What federal act is the licensee possibly violating?
Do Not Call Implementation Act of 2003
Which federal act makes phone solicitation to numbers on the Do Not Call Registry illegal unless a prior relationship or permission exists?
Do Not Call Implementation Act of 2003
The benefits of a home warranty for buyers are clear. Why might sellers want to offer a home warranty to buyers?
To protect themselves from any claims after closing.
Which of the following statutes is designed to ensure that lenders provide applicants with timely information about the total financial charge over the life of the loan?
Truth in Lending Act (TILA or Regulation Z)
Which of the following statements about unlicensed assistants in Alabama is true?
Unlicensed assistants may not perform any activities for which a license is required.
Seth is a licensee representing seller Dora. Which of these items is Seth required to disclose to prospective buyers about the property?
Dora doesn't use the back door because the steps leading to the yard are rotted.
Fewer buyers in a higher price range would create what kind of pressure on housing prices?
Downward
Purchase money mortgage
Duplex built in 1959
Luis, a listing agent, wants to post an ad for his new listing. Which of the following phrases is acceptable under fair housing guidelines?
Large, fenced backyard
In Alabama, a party to a property contract that's under seal has ______ from the date of a contract breach to sue the other party.
10 years
Alabama broker José is cleaning out his filing cabinets and shredding old records. He knows he must maintain the records of funds belonging to others for at least ________ years, but he destroys the older records.
3
Insurance claims might not appear on a CLUE report for a property if the claims were made more than ______ years ago.
7
Who would be most susceptible to a predatory lender?
A borrower with poor credit
Which of the following best defines traditional mortgage financing?
A loan, secured by the property being purchased, that a bank or mortgage lender issued to the buyer of real property
What is true about a material fact that a licensee must disclose?
A material fact may have more or less effect on a buyer based on the buyer's needs and values.
What do program developers typically include in program updates to fix any known problems or bugs?
A patch
Which of these is an example of blockbusting?
A real estate agent approaches a homeowner as soon as a demographic shift starts to occur in her neighborhood and convinces her that she needs to sell now, or she'll never be able to sell.
What's a trio?
A report that shows the parcel map, owner of record, and property profile
D'Wayne is acting as the buyer's agent for Alabama resident Rocky in a real estate transaction. In this transaction, D'Wayne is acting as ______.
A single agent
Shondra is acting as a buyer's agent for Tim and Johanna in a real estate transaction. What's the best description of her role?
A single agent
What would be considered a strength for a business in a SWOT analysis?
A skill or trait that is aligned with a business's goals
Megan finds herself in a breach of contract situation. While the other party met some of their obligations, some were not met. Megan thinks it would cost a lot of time and money to sue the other party. Thus, she decides to accept the work that has been done and call it good. This is an example of ________.
Accepting partial performance
Your buyer Billy wants to make an offer on the Craftsman house he saw today, but he wants the sellers to start the paperwork for a tax reassessment before closing. This isn't part of the standard sales contract in your area. What will you use to accomplish this request?
Addendum
A buyer requests that the warranty for the home's HVAC system be included as part of the agreement of sale. This is called a(n) ______.
Additional provision
What's a good strategy for pricing a seller's property?
Adjust pricing of comparable properties to determine a reasonable range for the market.
Your buyers love the 1891 Victorian they have under contract, but they want to get both the water and the paint tested as soon as possible. What are they testing for in both water and paint?
Lead
Quality photographs are a must! Include images of exteriors and street views, special architectural features, living rooms and bedrooms, kitchens and bathrooms, and ______.
Backyards, pools, and decks
An Alabama assistant must ______ to answer client questions about offers and negotiations.
Be licensed
Which of the following statements regarding electronic transactions in Alabama is true?
Both the federal UETA and Alabama laws allow, but don't require, electronic signatures, records transmission, and transactions.
Which of the following might require an adjustment to be made to a comparable (competitive) when preparing a CMA?
Busy street
The ______ is usually responsible for ordering and reviewing the survey of the property.
Buyer
If a buyer's agent gives the buyer misinformation about the property, who is responsible?
Buyer's agent
When licensees follow through on what prospects have asked, arrive for meetings on time, and come prepared, what trait are they exhibiting?
Competence
The Hendersons were hoping to list their home for $400,000; however, four other comparable homes in the neighborhood just went up for sale, and they now must list their property at $380,000 to sell quickly. Which economic principle is at work here?
Competition
Your buyer client, Percival, was pre-approved for the exact amount he needed to buy the home of his dreams, and he made an offer that was accepted by the seller. What's his next step?
Complete a loan application.
Which legislative act prohibits certain types of electronic communication?
CAN-SPAM
When a real estate licensee is studying market indicators, which of the following statements is true?
Changes in price levels within a given price range are indicators of supply and demand.
Which document(s) will the closing agent deliver to the buyer and seller after the closing?
Closing documents for the appropriate side of the transaction
A licensee has several tasks to perform for seller clients. One of these tasks is to ______.
Communicate all offers and counter-offers to the sellers
A licensee creating a CMA uses ______ to determine value.
Comparable sales
Which of the following is an opinion of list price range determined by looking at recently sold properties, comparing current competing properties and properties that didn't sell, and estimating buyer appeal regarding the style, location, and size?
Comparative market analysis
Which type of analysis starts with a visit to the property, a search on the MLS, and a comparison of comparable sales, and hopefully ends in a listing for a real estate licensee?
Comparative market analysis
An effective ______ includes incident response instructions, procedures for notice to affected individuals, and breach recovery procedures.
Data security program
What gets recorded and serves as public notice of ownership?
Deed
You've just received a trio from a title company. It contains an assessor's map, property profile, and ______.
Deed
A database is only useful if it's kept up to date. This means regularly culling, expanding, and ______ it.
Editing
What type of insurance covers licensees who are sued by consumers for inadvertent mistakes in a real estate transaction?
Errors and omissions
Which act attempted to eliminate discrimination caused by blockbusting, steering, and redlining?
Fair Housing Act of 1968
You've just received an offer from a potential buyer for a property you listed. When should you present the offer to your client?
Immediately
When a website has an S in the "http" portion of the URL, such as: "https://www.google.com," what does it mean?
It is a secure website.
In spite of her best efforts, Emily's seller client has overpriced his property. Why would she advise against this?
It may become stale on the market, resulting in lowball offers.
Broker Morgan enters into a brokerage agreement with buyer Suzanne. Which of the following does brokerage law require of this agreement?
It must include a statement of the terms and conditions of the brokerage services.
What's the purpose of a firewall?
It prevents hackers from infecting your system with viruses, worms, and malware.
Why should a licensee prepare a seller's net sheet, along with a comparative market analysis?
It shows the sellers what the recommended list price would net them.
Huntsville licensee Caden gave his buyer client a cash rebate as part of a recent real estate transaction. Which of the following statements about the cash rebate is true?
It's illegal for licensees to give cash rebates as part of a real estate transaction.
Drake's offer to purchase Kevin's condo currently has a financing contingency, an inspection contingency, an appraisal contingency, and a sale of current home contingency. Kevin also got an offer from Lucy, which came in at $5,000 less than Drake's offer but with only an appraisal contingency. What is true about Drake's offer compared to Lucy's?
It's likely viewed as a less favorable offer.
Nicholas is a new licensee in an area where there are a lot of condominiums and dwellings geared toward tourism and seasonal residents. He tries to drum up business by sending faxes to dozens of condo complexes. Which federal act might he be violating?
Junk Fax Prevention Act of 2005
What type of listing is illegal in Alabama?
Net listing
You want to make $50,000 in a year from your real estate business. You know that about 15% of the leads you get turn into clients. You earn an average of $8,000 on every closed transaction. Is this everything you need to know to use a funnel to determine how many leads you need to generate to get your $50,000?
No, you also need to know the percentage of clients who turn into closed transactions.
Four brokerage firms operate in the same small city as Jackson's firm. All the firms charge approximately the same listing commission and pay approximately the same cooperating commission to the selling broker. The commission splits within each firm are also similar. Is this an antitrust violation? Why or why not?
No. The fact that the firms' commission rates and splits are similar doesn't necessarily mean they agreed to fix those values.
In the strategic planning process, a business goal should be broken apart into smaller, achievable pieces known as __________.
Objectives
Eileen enters into a contract to buy Peter's home. The contract specifies that Peter must leave the refrigerator with the home and he must replace the roof before closing. After closing, Eileen arrives at the home and sees the nice new roof, but Peter took the refrigerator with him. This is an example of ______ of the contract.
Partial performance
A closing agent has several duties to perform both before and after the closing. Which of the following is a task the closing agent must complete after the closing?
Pay the existing loan off
Which type of listing can help a real estate professional determine how quickly a home in a given price range received an accepted offer?
Pending
Caden received an email from his credit card company's Fraud Detection Department indicating his account had been breached. The email told him he needed to update his account information with a new password, so he clicked on the link that was provided in the email and entered his new password. What type of scam did Caden just fall victim to?
Phishing
Parcels of land are valued at $50,000 each. However, when two of the parcels are joined, they are valued at $120,000. What economic principle is at work here?
Plottage
Which document is used to give a buyer an overview of the title history and information about what is or isn't covered in an insurance policy?
Preliminary report
Jonathan is a licensee who's just signed a listing agreement with his new client. Which of these actions should Jonathan plan to perform next, before he publishes the listing on the MLS?
Prepare a features list.
When multiple offers are received, licensees should do which of the following?
Prepare net proceeds statements on all offers.
What's part of the licensee's role in the closing process?
Preparing clients for closing
At what stage of the residential sales process would the listing agent typically obtain tax and property boundary information from the title company?
Preparing for listing
You're performing a CMA in preparation for a listing presentation. All the homes on the same street as your subject property are approximately the same size and age as your subject property. What would be needed to make any of these properties appropriate to use as comparables?
Recently sold
In 1934, when the Federal Housing Administration was created, it adopted the practice of crossing off cities and neighborhoods it considered risky and withheld mortgage funds those areas. What is this action called?
Redlining
What's the most important benefit a seller receives when signing an agency agreement?
Representation
When there's no buyer agency agreement in place, which of the following tasks can a licensee perform for the buyer?
Submit an offer on a listing.
Because 123 Main Street, which sold recently, is a comparable property, its sales price should be a good indicator of the value of 456 Elm. This demonstrates the principle of ______.
Substitution
This economic principle says that a property's value is determined by what it would cost to purchase a similar property.
Substitution
What well-known economic principle says that a property's value is determined by what it would cost to purchase a similar property?
Substitution
Wynona contracted with a gutter company that advertises a "Lifetime Guarantee of Trouble-Free Gutters." The agreement is that the company will replace her gutters with premium quality seamless aluminum. After she pays him, she learns that the new gutters are poor quality material and leak at the corners. The company refuses to remedy the situation. What can Wynona do to recoup the money she's lost?
Sue for damages
Jonathan wants to move to Las Vegas as soon as possible to start a new career as a blackjack dealer. He wants to sell his house immediately. What should you do as his listing agent?
Suggest that he accept a lower offer, even if it means a reduced commission for you.
When prices go down because there are too many homes on the market and too few buyers, this is an example of ______.
Supply and demand
When there are more homes for sale in an area than there are buyers, it means what?
Supply exceeds demand.
Who closes on the mortgage loan commitment at closing?
The buyer and the lender's attorney
Who should review the settlement statement before closing?
The buyer and the seller
If a buyer misses a contingency deadline, what's at risk?
The buyer's earnest money
Which individual is responsible for ordering, preparing, and reviewing closing-related documents such as the title policy and settlement statement?
The closing agent
You're about to attend your client's closing. Who will conduct the closing meeting?
The closing agent
When a seller consumer signs a brokerage agreement with a broker, this shows ______.
The consumer's acceptance of the relationship
Before cold calling, consult ______ and have a script ready.
The national Do Not Call Registry
Which of the following statements about the number of contingencies in a sales contract is true?
The inclusion of numerous contingencies makes it less likely that the buyer's offer will be accepted.
During a home inspection, Stan the inspector pointed out to the buyers that neither of the two bathrooms had vent fans installed. Why is this a potential problem that will be noted on the inspection report?
The lack of air circulation in a moist room leads to mold growth.
When a licensee represents a seller, which one of the following statements is true about the licensee's ability to list other properties that are for sale?
The licensee is permitted to list other properties for sale, even if they're competing properties.
A licensee's best source for leads and business is ______.
The licensee's sphere of influence
Which of the following states what the organization is about and its reason for being?
The mission statement
Which statement should licensee Shinwell disclose to prospective buyers about the property's condition that was left out of his client's Seller's Disclosure Statement? Assume Shinwell has actual knowledge of all of these.
The presence of a leaky toilet in the upstairs bathroom
In pricing a property, what might expired listings tell the real estate professional?
The price at which a property won't sell
Among other items, which of the following property details can only be verified by previewing a property in person?
The property's overall condition
When performing a market analysis, all adjustments are made to ______.
The sales price of the comparable properties
Prior to closing, who should request a loan payoff statement?
The seller
Which of the following scenarios describes actual knowledge that a licensee must disclose?
The seller didn't disclose any leaks, but the licensee sees moisture on the basement floor.
In Alabama, who generally prepares the seller's estimated closing statement?
The seller's agent
What factors determine how electronic media are disposed of?
The type of data, costs, environmental concerns, and compliance regulations
Assuming licensee Shannon has actual knowledge of all of the following property issues, which should she disclose to prospective buyers?
The upstairs bathroom has a leaky toilet.
When real estate licensees practice time blocking, what does this mean?
They don't answer their phone during that time.
Which of the following is true about for sale signs?
They require the seller's written permission to post.
Keira makes it a point to always include comparable active listings when she prepares a market analysis. Why?
They show sellers the current competition.
Under which of the following conditions is it okay for licensees to manipulate sale prices to help buyers qualify for a higher loan amount?
This is never okay.
Colleen, an Alabama licensee, has received a $25 gift card from an electrician to whom she referred a seller client. Which of the following is a true statement?
This would be illegal in Alabama, even if disclosed, because it's a referral fee (rebate).
The best way to start comparative market analysis data collection is to use properties that sold in the last ______.
Three to six months
Which type of antitrust violation occurs when the providing of one service is made dependent on the customer or client obtaining another recommended service?
Tie-in arrangement
John phoned a real estate licensee and heard the following message: "Hi. This is Avery with Elite Realty. When I'm with clients, I turn my phone off and give them my full attention. I'd be happy to do the same for you. Please leave a message, and I'll call you back as soon as I can." Obviously, Avery is practicing ______.
Time blocking
Your buyer is worried that after she closes on her property, she'll find out someone else has a claim to its ownership. What can reassure her?
Title insurance
Which of the following insures the policy owner against financial loss if the title to the real estate has covered defects?
Title insurance policy
What's the purpose of the Real Estate Brokerage Services Disclosure form?
To describe the types of brokerage services available to consumers in real estate transactions in Alabama
What's the purpose of the sales contract?
To document the buyer's offer to the seller to purchase the property identified in the agreement
A mission statement outlines what your business looks like today, while a(n) ________ describes what you want the future to look like.
Vision statement
Aside from paint, lead most commonly appears in ______.
Water pipe
In Alabama, an estimated closing statement must be provided to a buyer client ______.
When an offer is signed
Which of the following is a true statement about price ranges in a given market?
When studying price levels, you should look at how they rise or fall within a given price range, and not merely average sales price.
Which of these might bring a charge of illegal steering against a licensee?
When working with single female clients, Cassandra is careful to promote properties in neighborhoods she considers safe.
In what ways do people communicate?
Words, tones, gestures, body language, and facial expressions
Corinne, an escrow agent, is preparing for the Thomas/Trenton closing in four days. Which of these documents will Corinne prepare?
Working with the lender, she'll prepare the settlement statement, which details the costs the buyer and seller will have at closing.
Licensee Bert's seller client asks him not to tell prospective buyers that he's selling his house because he's lost his job and can't continue to afford the mortgage payments. Should Bert obey him?
Yes, because this is a lawful instruction, and this information should be kept confidential.
Your seller client Maurice has found a house he'd like to purchase, but he needs to sell his current house before he can make an offer. Should his desire for another property impact the pricing strategy on Maurice's house?
Yes, if his desire for the other property outweighs his need to get top dollar for his house.
Which of the following best demonstrates the fiduciary duty of disclosure?
You notify all parties of the existence of mold on the property.
What's your responsibility as a listing agent relative to the transaction as a whole?
You should manage the process from start to finish.
Frankie is writing an advertisement for her new listing. Which of the following adheres to federal fair housing guidelines?
You won't believe the view from this three-story investment chateau tucked in the mountains.
Steve is preparing a market analysis for the Joneses and has selected three comparable (competitive) properties. What's the maximum number of adjustments Steve should make to the Joneses' property?
Zero
Camille, a buyer, wants to change the price already agreed to in a sales contract. She should use a(n) ______.
Amendment
When Alabama licensee Jack is presenting an offer to his seller client, what else must he present to the seller?
An estimated closing statement, including the best estimate of the seller's closing costs
Lamar will close on his new home next week. It's a 37-year-old split level, so his agent asked if he's interested in purchasing a home warranty. "Why would I need a warranty?" he wondered. "Didn't the home inspection identify all of the issues, which have now been fixed?" What's the agent's best response to Lamar's question?
A home warranty covers things the inspection didn't address, like appliances, as well as structural issues that occur within the first year.
What is the mechanism by which asbestos can cause cancer?
Asbestos fibers decay, and the particles in the air can damage the lungs when inhaled.
In what type of financing arrangement does the buyer of a property take over payments on the seller's mortgage?
Assumable mortgage
Allen's property is being foreclosed upon. When must he be given notice of the right to redeem the property?
At least 30 days prior to the foreclosure sale
Which of the following is an example of an escalator offer?
Buyer offers $650,000 with clause that buyer will beat all competing offers by $3,000 up to $675,000.
Which of these agreement terms is typically a standard part of the sales contract?
Buyer's option to purchase a home warranty
Thad received multiple offers on his property and is reviewing them with his agent Nora. All of the offers have at least one contingency. Nora recommends that they reject the second offer, because it has a ______ contingency which is generally the most risky.
Home sale
When Marcy toured her new listing client's house, she noticed paint peeling off of the shutters. When she asked the seller if the house was painted with lead-based paint, he replied, "I'm not sure ... I inherited the house from my dad, who built it in the 1950s." What is Marcy required to do?
Inform the seller that he needs to complete the lead-based paint disclosure and provide the buyer with the EPA pamphlet regarding lead hazards.
What happens to an initial offer from the buyer after a seller counters?
It's no longer in play
Buyer Kristin has a buyer agency agreement with Carlotta, a licensee. Kristin's brother, Dalton, is going to showings with Kristin and working to help her decide which house is the best fit. Who is/are Carlotta's client(s)?
Kristin
Before sitting down to write a purchase agreement, a licensee should ______.
Review the contract for understanding of each section
Alabama licensee Rose is working with consumer Elijah who wants to buy a house. Which of the following is true?
Rose isn't required to present the consumer information booklet to Elijah at any time, but she may do so if she'd like.
Huntsville buyer Dorothea is responsible for paying her prorated portions of certain household expenses. In Alabama, which of the following methods is used to calculate prorations?
The 365-day method
When you use a comparative market analysis to calculate a suggested price range for a particular property, you will ______.
Use adjusted prices from sold comparables and refine the range with data about active listings, expired listings, and possibly pendings
