Real Estate Principles I Final
The applicant for a real estate salesperson's license must complete how many college-level courses before taking the licensing examination? a. One b. Five c. Three d. Seven
Three
129. The primary mortgage market consists of which of these? a. Lenders who initiate loans directly with borrowers b. FHA c. Entities who buy loans from lenders who make loans to borrowers d. Fannie Mae
a. Lenders who initiate loans directly with borrowers
67. The person who files a lawsuit against another person is known as the a. plaintiff. b. administrator. c. devisee. d. devisor.
a. plaintiff.
59. Bankruptcy laws are under the sole authority of a. the U.S. Congress. b. the Governor. c. each state individually. d. the probate court.
a. the U.S. Congress.
97. A tax deed is issued by
a. the county tax collector.
76. An example of an exception where the real estate law does not require licensing is
a. the resident manager of an apartment building.
103. An easement appurtenant usually is defined as
a. the right of the owner of one parcel of land to travel over an adjoining parcel.
30. A metes and bounds description can determine a property's a. value. b. perimeter. c. age. d. previous owner.
b. perimeter.
80. A fixture is anything that is
b. permanently attached or affixed to land
79. Which of the following is not one of the major rights of ownership?
c. Taxation
63. An encumbrance that makes property security for the payment of a debt is known as a. an easement. b. a license. c. a lien. d. a restriction.
c. a lien.
96. The type of deed that is used when property serves as security for a debt is a
a. trust deed
A contract that has no legal effect from its inception is a a. void contract. b. quasi contract. c. voidable contract. d. valid contract.
a. void contract.
The MOST commonly used form of listing agreement is the a. exclusive right to sell. b. exclusive agency. c. open agreement. d. net agreement.
a. exclusive right to sell.
34. A property interest that can be lost is a a. fee simple subject to a power of termination. b. fee simple absolute. c. freehold estate. d. life estate.
a. fee simple subject to a power of termination.
60. Title to real property is conveyed by grant from one person to another. The person receiving title is known as the a. grantee. b. beneficiary. c. grantor. d. trustor.
a. grantee.
Someone who receives real property is known as the a. mortgagee. b. devisor. c. grantor. d. grantee.
grantee
If a person dies without leaving a will, that person dies. a. testate b. administratively c. intestate d. statutorily
intestate
11. The limits on what can be paid out of the Recovery Account are a) $20,000 per licensee. b) $20,000 per licensee/$100,000 per transaction. c) $100,000 per transaction. d) $50,000 per transaction/$250,000 per licensee.
$50,000 per transaction/$250,000 per licensee.
1. The California Real Estate Law was upheld in a) 1900. b) 1950. c) 2000. d) 1919.
1919
How many sections are in a township? a. 6 b. 36 c. 24 d. 18
36
Every real estate broker must be licensed by the Department of a. Real Estate b. Corporations c. Housing d. State
Real Estate
Which type of deed would be used when the purchaser pays off a loan secured by the real estate? a. Quitclaim deed b. Trust deed c. Reconveyance deed d. Grant deed
Reconveyance deed
Which of the following deeds is a security instrument? a. Quitclaim deed b. Grant deed c. Trust deed d. Sherrif's deed
Trust deed
32. Which land measurement system describes land as "Beginning at a point on the..."? a. Metes and bounds b. Lot and block c. Rectangular survey d. All legal descriptions
a. Metes and bounds
32. Which land measurement system describes land as "Beginning at a point on the..."? a. Metes and bounds b. Lot and block c. Rectangular survey d. All legal descriptions
a. Metes and bounds
49. A married person who has two children dies without a will. What is the surviving spouse's share of the decedent's separate property? a. One-third b. One-half c. None d. All of it
a. One-third
119. The seller of residential property of one to four units must provide the buyer with a written a. Real Estate Transfer Disclosure Statement. b. neither of these. c. agency disclosure. d. both of these.
a. Real Estate Transfer Disclosure Statement.
Real property includes a. land. b. fixtures. c. appurtenances to land. d. all of these.
all of these
Community property is a. all property acquired by the husband during marriage. b. all property acquired during marriage that is not separate. c. all property acquired during marriage. d. the only form of ownership during marriage.
all property acquired during marriage that is not separate
Accretion is the process of accumulating new soil a. along a flowing body of water b. close to a baseline c. next to a lake d. adjacent to an ocean
along a flowing body of water.
Something that is used with the land for its benefit, such as a roadway or a waterway, is known as a. a fixture. b. an encumbrance. c. personal property. d. an appurtenance.
an appurtenance
30. The requirements for a valid deed are that the grantor must be competent and that the deed must be in writing, designate a grantee, have a granting clause, have an adequate description of the property, and be a) acknowledged. b) signed by the grantor. c) recorded. d) signed by the grantee.
b) signed by the grantor.
60. A remedy for a breach of contract is to sue to fulfill the terms of the contract, which is called a) unilateral rescission. b) specific performance. c) suit for actual damages. d) liquidated damages.
b) specific performance.
77. All California real estate agents, including both brokers and salespersons, must be at least how many years of age? a. 16 b. 18 c. 21 d. 28
b. 18
28. Compute the following area: S 1/2 of the SE 1/4 of Section 15, NE 1/4 of the NE 1/4 of Section 22, and W 1/2 of the NW 1/4 of Section 23. a. 180 acres b. 200 acres c. 320 acres d. 640 acres
b. 200 acres
Real estate loans generally include a promissory note and a a. purchase contract. b. security instrument c. settlement statement d. grant deed.
b. security instrument
47. Title to property in a trust is conveyed by the trustor to the a. grantor. b. trustee. c. devisor. d. beneficiary.
b. trustee
The federal agency that insures savings accounts is the a. FHA b. FNMA c. FDIC d. FHLMC
c. FDIC
51. A formal witnessed will is normally prepared by a. the testator. b. the court. c. an attorney. d. a notary.
c. an attorney.
74. Part of an improvement, such as a fence or driveway, that extends across a boundary line onto an adjacent property is a. a prescriptive easement. b. a zoning violation. c. an encroachment. d. a set-back requirement.
c. an encroachment.
A nonexclusive listing agreement is also known as a. a net listing. b. an option listing. c. an open listing. d. an agency listing.
c. an open listing.
51. The Transfer Disclosure Statement (TDS) is required in which type of transaction? a) Only in "as-is" sales b) Sales involving federally regulated lenders c) Sales involving co-owners d) Sales involving one- to four-family dwellings, except for specified exempt transactions
d) Sales involving one- to four-family dwellings, except for specified exempt transactions
31. The history of documents affecting title to a property is called a) a preliminary title report. b) a certificate of title. c) a guarantee of title. d) a chain of title.
d) a chain of title.
40. The penalty for violating a covenant is NOT as harsh as violating a) a subdivision deed restriction. b) a condominium bylaw. c) a deed restriction. d) a condition.
d) a condition.
24. A will that is in the testator's own handwriting is called a) a statutory will. b) a witnessed will. c) a nuncupative will. d) a holographic will.
d) a holographic will.
58. When a government agency decides a property is necessary for a public use, such as a highway, title is acquired through a. quiet title action. b. escheat. c. partition action. d. eminent domain.
d. eminent domain.
126. In a real estate loan transaction, the promissory note is a. the document that creates a lien on the property. b. a security instrument. c. used to identify the real property. d. evidence of the debt.
d. evidence of the debt.
A contract that has yet to be performed is known as an a. implied contract. b. executed contract. c. express contract. d. executory contract
d. executory contract
33. In medieval England, the highest form of land ownership was the a. estate for years. b. leasehold estate. c. life estate. d. freehold estate.
d. freehold estate.
5. A fictitious business name statement must be renewed every a) year. b) 18 months. c) five years. d) four years.
five years
14. All of the following describe personal property EXCEPT a) movable items. b) everything that is not real property. c) personalty. d) fixtures.
fixtures
9. The full term for a real estate broker's or salesperson's license is a) one year. b) 18 months. c) four years. d) two years.
four years
19. Ownership in severalty is a way of taking title to real estate that involves a) concurrent ownership by more than one person. b) separate ownership by one person. c) a combination of joint tenancy and community property. d) tenancy in partnership.
separate ownership by one person.
The four unities of joint tenancy do NOT include a. interest. b. severance. c. time. d. possession
severance
A real estate salesperson is supervised by a. the employing broker only. b. the buyer or seller. c. any licensed broker. d. the seller.
the employing broker only
Personal property is usually transferred by a a. will. b. bill of sale. c. deed. d. purchase contract.
will
104. Easements can be created by
a. either of these.
105. A license is
d. all of these
84. A life estate lasts
b. only as long as the life of an identified person in the deed creating it.
102. Bankruptcy is a
b. federal court proceeding.
17. A section contains a) 36 townships. b) 640 acres. c) 5,280 linear feet. d) 43,560 square feet.
640 Acres
18. Which of the following is NOT a less-than-freehold estate? a) Estate for years b) Life estate c) Periodic tenancy d) Estate at will
Life Estate
16. In a township, the section north of Section 10 is a) Section 3. b) Section 7. c) Section 12 d) Section 22
Section 3
12. Real property does NOT include a) land. b) fixtures. c) a mobilehome not permanently attached to a foundation. d) appurtenances.
a mobilehome not permanently attached to a foundation.
71. Ginnie Mae is a federal agency that backs a) FHA and VA residential loans. b) private lenders. c) hard money lenders. d) conventional loans.
a) FHA and VA residential loans.
41. A and B have two adjoining parcels of land. A gives B a written, revocable, nonexclusive right to cross over A's land as a short cut to B's rear yard. What is this right called? a) License b) Prescriptive easement c) Easement appurtenant d) Easement in gross
a) License
73. Regulations of municipalities and counties that control the use of real property are commonly known as a. zoning laws. b. government easements. c. condemnation laws. d. encroachment laws.
a. zoning laws.
Private land can be conveyed for public use or ownership by all of these methods EXCEPT a. deed b. common law dedication c. adverse possession d. statutory dedication
adverse possession
Land is torn away by the action of water in the process called a. accretion b. evolution c. avulsion d. reliction
avulsion
39. An easement by prescription terminates after nonuse for a) 180 days. b) 5 years. c) 3 months. d) 1 year.
b) 5 years.
64. A lien that is agreed to by the property owner is a. an involuntary lien. b. a voluntary lien. c. an easement. d. a license.
b. a voluntary lien.
61. To be valid, a grant deed requires all of the following except a. a granting clause. b. an acknowledgment. c. the signature of the grantor. d. the deed must be in writing.
b. an acknowledgment.
The repayment of a loan in equal installments that includes both interest and principal reduction is referred to as a. a straight loan. b. an amortized loan. c. a mortgage loan. d. a hard money loan
b. an amortized loan.
92. The term accession refers to
b. an increase in the property owned by either manmade or natural actions.
For tax purposes, a salesperson can work for the broker as a. a dual agent. b. an independent contractor. c. a subagent. d. a partner.
b. an independent contractor.
A contract that is a promise for a promise is known as a a. unilateral contract. b. bilateral contract c. void contract. d. voidable contract.
b. bilateral contract
107. Zoning is a law or ordinance specifying the possible uses of property imposed by
b. city or county government.
65. The judgment of a court, unless it provides otherwise, will impose a a. voluntary lien. b. general lien. c. mechanic's lien. d. specific lien.
b. general lien.
45. A listing agreement in which the owner retains the right to sell the property without paying a commission to the listing agent is known as a) an exclusive right-to-sell. b) a net listing. c) an exclusive agency. d) an open listing.
c) an exclusive agency.
46. The listing agreement in which a broker is entitled to a commission no matter who sells the property is known as a) an exclusive agency. b) a net listing. c) an exclusive right-to-sell. d) an open listing.
c) an exclusive right-to-sell.
26. The sudden loss of land through natural causes is called a) alluvion. b) accretion. c) avulsion. d) dereliction.
c) avulsion.
83. Which of the following estates would consist of the greatest amount of rights?
c. Fee-simple estate
136. To create a valid escrow for a real estate sale, the requirement(s) are a. a binding contract between the buyer and seller. b. a conditional delivery of the instruments of transfer to the escrow holder. c. both of these. d. either one or the other of these.
c. both of these.
50. The transfer of title by will is called a a. trust. b. conveyance. c. devise. d. codicil.
c. devise
68. For a federally related residential mortgage loan, the lender must give the borrower a) a transfer disclosure statement form. b) an agency disclosure. c) a copy of the completed loan application. d) the Closing Disclosure form.
d) the Closing Disclosure form.
52. Which of the following is NOT a way to acquire property by accession? a. Improvement b. Reliction c. Accretion d. Adverse possession
d. Adverse possession
137. Which of the following are exempt from escrow licensing requirements? a. Real estate brokers b. Attorneys c. Title insurance companies d. All of these
d. All of these
106. A covenant is a promise to do something or refrain from doing something which gives other property owners the right to which of the following?
d. Any of these
140. The Real Estate Law is found in Division 4 of the a. Civil Code. b. Financial Code. c. Government Code. d. Business and Professions Code.
d. Business and Professions Code.
Performance of a contract may be excused if a party can prove which of the following? a. A better deal elsewhere b. Novation c. Lack of negotiating skill d. Impracticability of performance
d. Impracticability of performance
124. Novation is when the parties to a contract a. cancel the contract. b. agree that neither party has an obligation to perform. c. disagree that one party can rescind and be released from performing. d. substitute a new agreement for the original one.
d. substitute a new agreement for the original one.
86. If no other method of taking title is specified, and parties are not married to each other, the default form of title created is
d. tenancy in common
121. An implied contract is established by a. a written agreement of the parties. b. an oral agreement. c. a written agreement of the parties, but only if it is signed by all parties. d. the conduct of the parties.
d. the conduct of the parties.
75. When a salesperson changes employment from one broker to another a. the new employing broker doesn't have to do anything. b. the salesperson must send their license certificate to Sacramento. c. the salesperson must immediately file a certified written statement of why they left the previous employing broker. d. the former employing broker must notify DRE immediately, in writing.
d. the former employing broker must notify DRE immediately, in writing.
Money is a medium of exchange as well as a measure of a. credit. b. intrinsic worth. c. investment potential d. value.
d. value.
10. The special fund established to help compensate parties who have obtained a judgment against licensees that is uncollectible is called a) the recovery account. b) the impound account. c) the commissioner's fraud fund. d) the broker trust fund.
the recovery account
15. The legal method of describing land that would be used to follow each boundary for a given distance for an irregular parcel is a) lot and block. b) government survey. c) fractional method. d) metes and bounds.
metes and bounds
California's Real Estate Law is found in the a. Government Code. b. Business and Professions Code. c. Civil Code. d. Financial Code.
Business and Professions Code.
32. A deed that conveys after-acquired title and contains implied warranties is a) a warranty deed. b) a trust deed. c) a grant deed. d) a quitclaim deed.
c) a grant deed.
Which of the following does NOT require a real estate license? a. Presenting an offer b. Negotiating a lease c. Taking a listing d. Selling your own property
Selling your own property
A holder of which of the following ownership interests can devise their share of the property to someone else? a. Community property with right of survivorship. b. Tenancy in common. c. Tenancy in partnership. d. Joint tenancy.
Tenancy in common
82. A metes and bounds legal description of real property starts at
a. a designated point, called the point of beginning.
The rectangular survey system is also known as the a. metes and bounds system b. lot, block, and tract system. c. Torrens system. d. U.S. government survey system.
U.S. government survey system
The highest form of modern land ownership is known as a. a fee simple absolute. b. an estate for years. c. a real estate trust. d. a life estate.
a fee simple absolute
13. An example of an appurtenance that "runs with" or is transferred with the land is a) a fixture. b) an emblement. c) stock in a mutual water company. d) a tree.
a fixture
8. To qualify for a real estate broker's license, a person must complete a) two college-level courses within 18 months. b) a two-year AA degree. c) a four-year college degree. d) eight college-level courses.
a four-year college degree
36. An owner of property can protect against a mechanic's lien for unauthorized work by filing a) a preliminary notice. b) a notice of nonresponsibility. c) a payment bond. d) a homestead.
a) a preliminary notice.
52. Agency agreements may be terminated by a) all of these. b) expiration. c) destruction of the property. d) death or bankruptcy of the principal or broker.
a) all of these.
58. To have a valid contract, an obligation or payment by each party must be made, which is referred to as a) consideration. b) adequate and sufficient value. c) duress. d) affection.
a) consideration.
42. A real estate broker who acts as a dual agent and represents both the buyer and the seller in the same transaction must make sure that both parties a) give their consent. b) pay a commission. c) act in good faith. d) sign the escrow instructions.
a) give their consent.
21. All of the following are unities of joint tenancy EXCEPT a) partition. b) interest. c) title. d) time.
a) partition.
64. Before a foreclosure sale takes place, the default can be cured and the borrower can exit the foreclosure process by paying all delinquencies and costs in a process known as a) reinstatement. b) hypothecation. c) equity sharing. d) alienation.
a) reinstatement.
109. The homestead exemption applies to owner occupied dwellings that include which of the following?
a. Any of these
An agent owes which of the following to a third party? a. Duty of disclosure b. Duty of representation c. Fiduciary duties d. Duty of trust
a. Duty of disclosure
TRID consolidates disclosures required to be made to consumers under the Truth in Lending Act and a. Real Estate Settlement Procedures Act b. California Finance Lenders Law c. California Residential Mortgage Lending Act d. Fair Credit Reporting Act
a. Real Estate Settlement Procedures Act
46. The concept of community property between spouses is a holdover from a. Spanish rule. b. medieval England. c. the inheritance tax laws. d. the bundle of rights.
a. Spanish rule.
114. Which of these typically provides authority for licensees to handle deposits? a. Standard listing agreement forms b. Standard sales agreement forms c. The Multiple Listing Service Rules d. The Code of Ethics
a. Standard listing agreement forms
110. In every agency relationship there are
a. a principal, an agent, and a third person.
76. An agent represents someone else, known as a principal, in dealings with third parties in a representation known as a. agency. b. listing contract. c. exclusive right to sell. d. power of attorney.
a. agency.
77. Expiration of an employing broker's license will result in
a. all licensees who work for the broker being placed on nonworking status.
70. When a property is landlocked and cannot be accessed from a roadway, the owner of that property would file for a. an easement by necessity. b. a prescriptive easement. c. a license. d. a lien.
a. an easement by necessity.
74. A real estate brokerage can operate as a. any of these. b. sole proprietorship. c. corporation. d. partnership
a. any of these.
Failure to perform a contract obligation is known as a a. breach. b. release. c. novation. d. recission.
a. breach.
62. A property interest may not be marketable, if there is a a. cloud on the title. b. condition subsequent. c. restriction. d. defect.
a. cloud on the title.
116. Every exclusive type of listing agreement must contain a a. commission agreement. b. definite, specified date of final termination. c. safety clause. d. provision that every property must be placed on the multiple listing service.
a. commission agreement.
138. A license to act as an escrow agent can be held only by a a. corporation. b. partnership. c. trust company. d. limited liability company.
a. corporation.
The security instrument of choice in California is the a. deed of trust b. quitclaim deed. c. grant deed. d. morgtage
a. deed of trust
117. A commission is earned by a real estate licensee who has entered into a listing contract when a. either of these. b. neither of these. c. the broker finds a buyer who is ready, willing, and able to purchase the property on the seller's original terms in the listing agreement. d. the seller accepts a purchase offer at an agreed on price and terms.
a. either of these.
135. Federal law makes electronic signatures a. have the same legal validity as written documents in every state. b. illegal. c. valid if they are witnessed. d. acceptable but only if all parties agree to use them.
a. have the same legal validity as written documents in every state.
113. The agency disclosure form a. is required in any transaction a real estate licensee is involved in. b. creates an agency relationship. c. is optional and can be provided at the licensee's discretion. d. is required in any transactions involving one-to-four residential units.
a. is required in any transaction a real estate licensee is involved in.
29. The important dimensions of any rectangular survey description are the a. metes and bounds. b. angles of measurement. c. compass points. d. map book pages.
a. metes and bounds.
133. One discount point equals a. one percentage point of the loan amount. b. one percentage point of the selling price. c. one percentage point of the cash down payment. d. one percent additional interest on the loan.
a. one percentage point of the loan amount.
A real estate broker works for the a. principal. b. third party. c. Department of Real Estate. d. real estate board.
a. principal.
48. The process by which a person takes title to real property from the estate of someone who has died is known as acquisition by a. succession. b. occupancy. c. accession. d. transfer.
a. succession.
The Real Estate Law allows a business opportunity to be sold a. by a PRLS licensee. b. by a financial planner. c. with a special endorsement. d. by a real estate licensee.
by a real estate licensee
50. An agent owes which of the following duties to the principal? a) Good faith and honesty b) All of these c) Obedience d) Full disclosure of all material facts
b) All of these
72. What does an escrow officer file with the court when the buyer and the seller are unable to resolve a dispute regarding the release of funds? a) Writ of possession b) Interpleader action c) Quiet title action d) Estoppel agreement
b) Interpleader action
57. Which of the following is NOT an example of actual fraud? a) A promise made without any intention of performing it b) Misrepresentations made without fraudulent intent c) Lying d) Suppressing known facts
b) Misrepresentations made without fraudulent intent
47. What type of listing is typically used when the broker may want to purchase the property? a) Net listing b) Option listing c) Exclusive agency d) Exclusive right-to-sell
b) Option listing
65. The return of title to a borrower after the payoff of a debt is accomplished by the trustee executing and delivering which document to the trustor? a) Quitclaim deed b) Reconveyance deed c) Grant deed d) Notice of default
b) Reconveyance deed
34. The instrument usually used to clear clouds on title or to terminate deed restrictions is a) a reconveyance deed. b) a quitclaim deed. c) a trust deed. d) a warranty deed.
b) a quitclaim deed.
25. The gradual addition to land through natural causes is called a) prescription. b) accretion. c) avulsion. d) alienation.
b) accretion.
29. To be valid, a deed must have all of the following EXCEPT a) be in writing. b) be recorded at the county recorder. c) a grantor's signature. d) a granting clause.
b) be recorded at the county recorder.
69. Loans that do NOT involve government cooperation, such as a guarantee or insurance, are known as a) hard money loans. b) conventional loans. c) secondary funding loans. d) mortgage-backed securities.
b) conventional loans.
44. Agency disclosure law requires specified agency disclosures a) on all sales of real property. b) in all residential transactions involving one to four dwelling units. c) only on dual agency transactions. d) only when there are two real estate companies involved in the transaction.
b) in all residential transactions involving one to four dwelling units.
23. When a person dies without a will, the person is said to have died a) testate. b) intestate. c) with a devise. d) with a bequest.
b) intestate.
55. A contract is NOT created until offer, acceptance, and communication of acceptance have taken place and the parties have arrived at a) novation. b) mutual consent. c) estoppel. d) rescission.
b) mutual consent.
28. Compute the following area: S 1/2 of the SE 1/4 of Section 15, NE 1/4 of the NE 1/4 of Section 22, and W 1/2 of the NW 1/4 of Section 23. a. 180 acres b. 200 acres c. 320 acres d. 640 acres
b. 200 acres
73. The law commonly referred to as the Real Estate Law is found in the a. Civil Code. b. Business and Professions Code. c. Corporation Code. d. Finance Code.
b. Business and Professions Code.
134. Freddie Mac was created to provide a secondary market for which of the following? a. FHA loans b. Residential conventional loans c. VA loans d. Cal Vet loans
b. Residential conventional loans
125. Which of the following provides that a lawsuit based on a written contract, such as a real estate sales contract, must be initiated within four years? a. The statute of frauds b. The statute of limitations c. The statute of perpetuities d. The statute of terminations
b. The statute of limitations
Which of the following is NOT a way to terminate a contract? a. Release b. Verification c. Recission d. Novation
b. Verification
101. A judgment is
b. a final determination of the rights of the parties in a lawsuit.
68. An encumbrance that transfers title to property pending the outcome of litigation is a. a lien. b. a judgment. c. an attachment. d. a restriction.
b. a judgment.
71. A temporary, nonexclusive right to travel across the property of another that can be terminated at any time is known as a. a prescriptive easement. b. a license. c. an easement appurtenant. d. a lien.
b. a license.
An instrument by which property is hypothecated to secure the payment of a debt or obligation is known as a. a reconveyance deed. b. a mortgage. c. a sheriff's deed. d. an encroachment.
b. a mortgage.
57. When a person dies and has no heir, title to the property passes to the state through a process known as a. quiet title action. b. escheat. c. interpleader action. d. bequest.
b. escheat.
115. A deposit check may be held uncashed by the broker until acceptance of the offer a. if the buyer has given written instructions to hold the check uncashed. b. if the seller is informed that the check is being held uncashed. c. if there is not enough money in the account to cash the check. d. under no circumstances. Deposit checks must always be cashed immediately.
b. if the seller is informed that the check is being held uncashed.
The cost of using money BEST describes a. credit. b. interest. c. a free market. d. an open market.
b. interest.
One of the MOST important duties of agent to principal is the duty of a. salesmanship. b. loyalty. c. beneficial conduct. d. hard work.
b. loyalty.
Real estate commission rates are a. fixed by law. b. negotiable. c. subject to cancellation. d. always 4 percent.
b. negotiable.
56. If a condition subsequent in a deed to real property is breached, the grantor has the right to reacquire title through a a. codicil. b. power of termination. c. probate proceeding. d. foreclosure.
b. power of termination.
54. When the federal government transfers land to a private party, such as by selling a military installation to a developer, the deed transfers by a. private grant. b. public grant. c. public dedication. d. quiet title action.
b. public grant.
130. Loan-to-value ratio refers to a. the difference between the selling price of a property and what a seller paid for the property when they acquired it. b. the percentage amount of the difference between the current appraised market value and the amount of the loan. c. the amount of the loan over 80% that the borrower will have to have insurance on. d. the amount of profit the owner has in the property.
b. the percentage amount of the difference between the current appraised market value and the amount of the loan.
33. A deed that makes no express or implied warranties that the grantor owns any interest in a property is a) a warranty deed. b) a trust deed. c) a quitclaim deed. d) a grant deed.
c) a quitclaim deed.
35. A lien is an example of a) an easement. b) an encroachment. c) an encumbrance. d) an exemption.
c) an encumbrance.
53. A contract that has NOT been fully performed by one or both parties is referred to as a) implied. b) executed. c) executory. d) unilateral.
c) executory.
49. A listing agreement is an employment contract that appoints a broker as an owner's agent for the purpose of a) selling the property at any price. b) earning a commission. c) finding a ready, willing, and able buyer. d) locating anyone willing to make an offer.
c) finding a ready, willing, and able buyer.
27. One of the requirements to acquire title by adverse possession is to pay all the property taxes for a) one year. b) three years. c) five years. d) seven years.
c) five years.
70. For VA loans, a portion of the principal is a) insured. b) neither guaranteed nor insured. c) guaranteed. d) both guaranteed and insured.
c) guaranteed.
43. Undisclosed dual agency is a) permitted so long as no injury is sustained. b) permitted so long as the principal paying the commission consents. c) illegal. d) permitted on residential property.
c) illegal.
37. A gas company that does not own adjacent land has a right-of-way over an owner's land. Such an interest is known as an easement a) by prescription. b) by implication of law. c) in gross. d) appurtenant.
c) in gross.
59. According to the statute of frauds, a lease of real property for more than one year must be a) acknowledged by a notary public. b) signed by both the lessor and lessee. c) in writing. d) written by an attorney.
c) in writing.
38. An easement by necessity is often created by the courts to prevent a) ingress and egress. b) easement by prescription. c) landlocked property. d) eminent domain.
c) landlocked property.
66. The MOST significant difference between a mortgage and a deed of trust is that, after a trustee's sale using a deed of trust, the trustor has a) a right of first refusal. b) a six-month redemption period. c) no post-sale right of redemption. d) a 72-hour redemption period.
c) no post-sale right of redemption.
54. To have the capacity to contract, a person must a) be 18 years of age or older. b) be a resident of the United States. c) not be under the influence of drugs. d) not be incarcerated.
c) not be under the influence of drugs.
63. The financing instrument favored in California is a) the mortgage. b) the quitclaim deed. c) the deed of trust. d) the grant deed.
c) the deed of trust.
62. When property is used to secure payment of a debt or obligation, a lien on the property is given by the borrower, who is called a) the mortgagee. b) the lender. c) the mortgagor. d) the trustee.
c) the mortgagor.
53. To acquire title by adverse possession, you must occupy the property in an open manner for how many years? a. Three b. Four c. Five d. Seven
c. Five
95. A gift deed will typically use which of the following phrases to indicate the nature of the consideration involved?
c. Love and affection
100. Which of the following would be an example of someone who would NOT qualify to file a mechanics lien?
c. Real estate brokers
A provision that gives the lender the right to demand full payment of a mortgage upon a sale of the property is a. a partition clause. b. an escalator clause. c. a due-on-sale clause. d. a notice-of-sale.
c. a due-on-sale clause.
118. A material fact is defined as a. every fact concerning the property. b. any consequential fact concerning the property, unless the seller tells the licensee not to tell the buyer. c. any fact that would affect the value or desirability of the property. d. inconsequential facts not having to do with the property.
c. any fact that would affect the value or desirability of the property.
To be enforceable, real estate sales agreements must a. be recorded. b. contain a granting clause. c. be in writing. d. be acknowledged.
c. be in writing.
The typical real estate purchase agreement is a. a voidable contract. b. a unilateral contract. c. bilateral contract. d. an implied contract.
c. bilateral contract.
81. Riparian rights refer to the rights of the owner of land
c. bordering a river or other flowing stream.
122. In a bilateral contract a. both parties make a promise to do something. b. both parties have an obligation to perform. c. both of these. d. neither of these, only one party makes a promise and has a duty to perform.
c. both of these.
91. Sales of real property in probate
c. can include paying real estate broker commissions but the amount may be subject to court approval.
127. Usury is a. an ancient lending practice that doesn't exist anymore. b. a way for lenders to make excessive amounts of interest. c. charging an exorbitant rate of interest and is regulated by both state and federal law. d. a law that limits amount of interest on real estate loans made or arranged by real estate brokers.
c. charging an exorbitant rate of interest and is regulated by both state and federal law.
31. In a metes and bounds description, the term metes refers to a. angles. b. degrees on the compass. c. distances. d. markers.
c. distances.
31. In a metes and bounds description, the term metes refers to a. angles. b. degrees on the compass. c. distances. d. markers.
c. distances.
99. Liens can be
c. either of these
120. A contract is a. a promise made by one person to another to do something. b. a promise made by one person to another to refrain from doing something. c. either of these. d. neither of these.
c. either of these.
98. The word encumbrance refers to anything that effects an owner's
c. either of these.
132. FHA loans a. have a prepayment penalty for the first five years. b. have a prepayment penalty for the life of the loan. c. have no prepayment penalties. d. have a prepayment penalty until 80% of the loan is paid off.
c. have no prepayment penalties.
128. When more than one person signs a promissory note, the resulting joint and several liability means a. only one of the parties will be held liable for the amount of the loan. b. if one party is identified as a cosigner they will not be held liable. c. if one cosigner defaults on the payment the lender can demand full payment from any other cosigner. d. the note is negotiable.
c. if one cosigner defaults on the payment the lender can demand full payment from any other cosigner.
When an agent represents both the buyer and seller in the same transaction, this action is a. against the law. b. an example of subagency. c. known as dual agency. d. prohibited by the MLS.
c. known as dual agency.
66. When an owner of real property wants protection against unauthorized work by a tenant, the owner can post and record a a. notice to quit. b. quiet title action. c. notice of nonresponsibility. d. notice of cessation.
c. notice of nonresponsibility.
When both parties to a contract agree to substitute a new agreement for the present one, this is known as a a. breach. b. release. c. novation. d. recission.
c. novation.
Both parties agree to cancel a contract in the process of a. reformation. b. novation. c. recission. d. release.
c. recission.
87. Property that was a married person's property before marriage
c. remains separate property after marriage unless there is an agreement to make it community property by the spouses or it is commingled with community property.
45. The four unities of a joint tenancy do NOT include a. time. b. title. c. severance. d. possession.
c. severance
93. The kind of deed a person receives at a court ordered execution sale is called
c. sheriff's deed.
90. A person who makes a will is called the
c. testator
108. An encroachment occurs when part of an improvement extends over a boundary line between properties
c. without permission
If an owner devotes land to a public use, such as a roadway, a transfer occurs by a. condemnation b. partition c. common law dedication d. escheat
common law dedication
4. A fictitious business name statement must be filed with a) the secretary of state. b) the county clerk. c) the local MLS. d) the superior court.
county clerk
56. A counteroffer is legally considered a) a contract. b) a novation. c) a rescission. d) a rejection.
d) a rejection.
61.The repayment of a loan that is made by installments of interest only with the principal due in a lump sum is a) a hard money loan. b) an amortized loan. c) a mortgage loan. d) a straight note.
d) a straight note.
22. The legal presumption is that all property acquired during marriage is a) joint tenancy. b) tenancy in common. c) severalty. d) community property.
d) community property.
48. In California, real estate commissions are a) 5%. b) always set by the courts. c) no higher than the maximum rate established by the MLS. d) negotiable.
d) negotiable.
28. An easement that is acquired by a use that is hostile to the interests of the owner is an easement by a) condemnation. b) implication of law. c) express grant. d) prescription.
d) prescription.
67. Real estate licensees act as mortgage brokers when they a) loan their own money. b) invest directly in participation loans. c) make construction loans. d) solicit borrowers or lenders for loans.
d) solicit borrowers or lenders for loans.
44. Which of the following is NOT considered concurrent ownership? a. Joint tenancy b. Tenancy in common c. Community property d. Ownership in severalty
d. Ownership in severalty
94. Escheat is the legal process the governments uses to take title to real property when
d. a person dies without any apparent heirs and no claimant comes forward within five years.
55. When a deed to real property is ambiguous, a party would try to avoid later problems by filing a/an a. quiet title action. b. interpleader. c. quitclaim deed. d. action for declaratory relief.
d. action for declaratory relief.
69. An easement may be created by a. contract. b. implication of law. c. express grant. d. all of the above.
d. all of the above.
139. A standard policy of title insurance covers a. forgery. b. recording defects. c. improper delivery of a document of title or incapacity of a grantor. d. all of these.
d. all of these.
The Real Estate Law treats a salesperson as a. a dual agent. b. a general agent. c. an independent contractor. d. an employee of the broker.
d. an employee of the broker.
88. All partners in a general partnership
d. are liable for debts of the partnership.
112. In a single agency a. an agent represents two principals in the same transaction. b. there is only one broker involved in the transaction. c. there can be no salesperson licensees involved in a transaction. d. each principal in a transaction is represented by a different broker.
d. each principal in a transaction is represented by a different broker.
85. The person conveying an interest in property with a deed is called the
d. grantor.
75. The homestead exemption is intended to protect the owner's a. automobile and house. b. business. c. investments. d. home equity.
d. home equity.
111. A multiple listing service (MLS) is an organization of member real estate agents that a. advertises properties for anyone who pays a fee. b. records deeds when properties are sold. c. is regulated by the state. d. makes property information available to its members.
d. makes property information available to its members.
Which of the following is NOT an institutional lender? a. thrift. b. savings and loan. c. insurance company. d. mortgage company.
d. mortgage company.
131. An acceleration clause in a loan can result in the lender demanding full payment of the balance on the loan if a. the borrower fails to pay the taxes. b. the borrower uses the property for an illegal purpose. c. either of the above. d. neither of the above.
d. neither of the above.
An agent is authorized to act in place of the principal by a a. purchase contract. b. multiple listing clause. c. listing agreement. d. power of attorney.
d. power of attorney.
72. Covenants and conditions all serve to control the use of land and may be referred to as a. easements. b. attachments. c. liens. d. restrictions.
d. restrictions.
89. The simplest form of business ownership is a
d. sole proprietorship.
123. The statute of frauds is a law that requires a. parties to a contract to not commit fraud. b. lawsuits to be initiated within certain time periods. c. buyers and sellers of real property to make specified disclosures about the condition of property. d. specified types of contracts to be in writing.
d. specified types of contracts to be in writing.
The right of a government agency to take private property for public use is called a. a quiet title action b. escheat c. eminent domain d. a partition action
eminent domain
Under the Real Estate Law, a real estate salesperson works for a broker as an a. agent. b. employee. c. associate broker. d. independent contractor.
employee
The right of possession is restricted under a a. freehold estate. b. life estate with a right of reversion. c. fee simple qualified. d. fee simple defeasible.
fee simple defeasible
Real estate licenses are renewable for a period of a. four years. b. two years. c. one year. d. three years.
four years
In medieval England, the highest form of ownership was the a. freehold estate. b. life estate. c. leasehold estate. d. estate for years.
freehold estate
Under Spanish rule, land was owned primarily by the a. conquistadors. b. king. c. missions. d. peasants.
king
A real estate broker's license may be obtained by any of the following except a a. sole proprietorship. b. corporation. c. limited liability company. d. partnership.
limited liability company
There are three principal baselines and meridians in California. The intersection of the Humboldt Baseline and Meridian is in a. a state other than California. b. central California. c. southern California. d. northern California.
northern California
The test for a fixture does NOT include a. intent of the parties. b. origin of manufacture. c. method of attachment. d. relationship of the parties.
origin of manufacture
Today, more than 50 percent of California land is owned by the a. municipalities. b. federal government. c. state government. d. private sector.
private sector
The term real estate means the same thing as a. intangible personal property. b. real property. c. ownership. d. personal property.
real property
In order to be valid, a grant deed does not require a. a proper writing b. recording c. the signature of the grantor d. a granting clause
recording
The right of the future holder of what is currently a life estate is a a. fee simple defeasible. b. remainder. c. fee simple subject to a power of termination. d. fee simple conditional.
remainder
The right of the future holder of what is currently a life estate is a a. remainder. b. fee simple defeasible. c. fee simple conditional. d. fee simple subject to a power of termination.
remainder
20. The special benefit of joint tenancy is a) concurrent ownership. b) color of title. c) right of possession. d) right of survivorship.
right of survivorship.
Ownership in severalty is a. separate ownership. b. community property. c. concurrent ownership. d. a joint tenancy.
separate ownership
3. The California Real Estate Commissioner is appointed by a) the governor of California. b) the head of the Business Transportation and Housing Agency. c) the California legislature. d) the local REALTOR® association.
the governor of California
6. Real estate licensees are authorized to help people buy and sell mobilehomes provided a) the buyer and seller consent. b) the licensee gets a special permit from the Department of Real Estate. c) the mobilehome has been registered with the Department of Housing and Community Development. d) the licensee registers as a mobilehome broker with the California Department of Motor Vehicles.
the mobilehome has been registered with the Department of Housing and Community Development.
2. The Real Estate Commissioner's regulations have a) authority only over the DRE staff. b) never been enforced. c) the same force and effect as law. d) no impact on licensees.
the same force and effect as law.
7. A prepaid rental listing service (PRLS) license is valid for a) one year. b) two years. c) 18 months. d) four years.
two years
When a real estate license expires, licensed activity must cease but the license may be renewed up to a. four years later. b. three years later. c. two years later. d. one year later.
two years later
A holographic will does NOT have to be a. witnessed b. entirely handwritten c. dated d. signed
witnessed
