REAL ESTATE SALESPERSON EXAM- chapter 2 questions
A BUYER PURCHASED A PROPERTY OBTAINING A LOAN FOR $130,000, PAYMENTS OF $908 PER MONTH, AND INTEREST RATE OF 7.5% AND A 30-YEAR TERM. HOW MUCH TOTAL INTEREST WOULD BE PAID OVER TIME? a. $130,000 b. $196,880 c. $296,750 d. $326,880
b
A PROPERTY SOLD FOR $85,000 WITH THE BUYER MAKING A MONTHLY PAYMENT OF $12 PER $1000 OF LOAN AMOUNT. IF THE BUYER'S MAXIMUM PRINCIPAL AND INTEREST MONTHLY PAYMENT WAS $750, WHAT WOULD BE THE DOWN PAYMENT? a. $18,500 b. $22,500 c. $29,750 d. $33,000
b
A SALESPERSON IS AN INDEPENDENT CONTRACTOR FOR A BROKERAGE COMPANY. WHICH OF THE FOLLOWING STATEMENTS ARE TRUE REGARDING THIS SITUATION? a. the salesperson would be required to attend all the sales meetings b. the broker would not withhold any taxes out of commission checks paid to salesperson c. the broker must purchase independent contractor insurance d. the salesperson would not be allowed to take yearly vacations
b
ACCORDING TO REGULATION Z (TILA), AND ADVERTISEMENT INCLUDING WHICH OF THE FOLLOWING TERMS WOULD REQUIRE THAT ALL THE FINANCING TERMS BE DISCLOSED? a. low monthly payment b. 7% interest rate c. low down payment d. FHA financing available
b
WHICH OF THE FOLLOWING BEST DESCRIBES THE TERM "VENDEE"? a. one who sells or tries to sell b. one who buys or offers to buy c. one who loans or offers to loan d. one who borrows or tries to borrow
b
A BUYER BOUGHT A $72,000 PROPERTY OBTAINING A 90% LOAN. THE LENDER REQUIRED ANNUAL PRIVATE MORTGAGE INSURANCE (PMI) OF .5% PAID UP FRONT AND 1/12 EACH MONTH. WHAT WAS THE MONTHLY PMI? a. $27 b. $34 c. $39 d. $45
a
A LICENSEE IS IN RECEIPT OF AN EXECUTED OFFER TO PURCHASE CONTRACT, TO WHOM SHULD THE LICENSEE GIVE THE CONTRACT? a. the principle broker b. the title company c. the real estate commission
a
A REAL ESTATE PURCHASER IS SAID TO HAVE EQUITABLE TITLE WHEN: a. the real estate contract is signed by both buyer and seller b. conveyancing occurs c. the offer is submitted to the seller d. the purchaser gives an earnest deposit
a
HOW DOES A BUYER BECOME A CLIENT OF A BROKER? a. by signing an agency agreement with a broker b. by looking at a broker's in-house listings c. by writing a sales contract with a broker d. by looking at other companies' listings with a broker
a
THE STANDARD AGENCY RELATIONSHIP THAT EXISTS BETWEEN THE LISTING BROER AND THE SELLER IS: a. special b. general c. universal d. ostensible
a
WHERE WOULD A PERSON GO IN ORDER TO OBTAIN AN FHA OR VA LOAN? a. an approved mortgage banker b. an insurance company c. an FHA or VA office d. an FNMA office
a
WHICH OF THE FOLLOWING ITEMS WOULD BE PRORATED AT CLOSING a. annual real estate taxes b. earnest money c. inspection fee d. closing fee
a
WHICH OF THE FOLLOWING STATEMENTS IS TRUE OF AN ADJUSTABLE RATE MORTGAGE? a. the interest rate can change based upon market indexes agreed to up front b. the interest rate can only be changed with the borrower's consent c. the interest rate cannot change unless it goes up or down more than 2% from the original starting rate d. the loan cannot be sold on the secondary mortgage market
a
WHICH OF THE FOLLOWING VIOLATE THE SHERMAN ANTI-TRUST LAWS? a. a group of brokers setting a common commission rate b. a broker establishing a commission split between the employer and employee c. an agent directing buyers toward areas based on race d. a lender limiting loans to a certain geographical area
a
A HOUSE WAS LISTED FOR $127,000. AN OFFER OF $120,000 WAS MADE AND ACCEPTED. THE COMMISSION OF THE SALE WAS 7% OF WHICH THE SALESPERSON RECEIVED 40%. HOW MUCH WOULD THE SALES PERSON RECEIVE? a. $1,680 b. $3,360 c. $3,556 d. $5,334
b
A LENDER CHARGES DISCOUNT POINTS IN ORDER TO: a. limit the number of qualified buyers b. increase the effective yield of the loan c. decrease the profit of the lender d. decrease the annual percentage rate over the life of the loan
b
A LISTING AGENT IS SHOWING THE LISTED PROPERTY TO A PROSPECTIVE BUYER. THE BUYER TELLS THE LISTING AGENT THAT A FAVORABLE ZONING IS COMING WITH REGARD TO THE LISTING PROPERTY. WHAT SHOULD THE LISTING AGENT DO? a. call the broker for help b. tell the seller because of the fiduciary obligation to the seller c. don't tell the seller as this violated confidentiality to the buyer d. don't tell anyone as the buyer could sue the agent for damages as disclosed
b
A LOAN THAT IS PAID OFF EITHER BY THE SALE OF THE PROPERTY OR THE DEATH OF THE BORROWER IS CALLED: a. shared appreciation mortgage (SAM) b. reverse annuity mortgage (RAM) c. growing equity mortgage d. package mortgage
b
A PROFESSIONAL TENNIS PLAYER IS TRYING TO PURCHASE REAL ESTATE AND OBTAIN A LOAN. THE TENNIS PLAYER HAS A SUBSTANTIAL DOWN PAYMENT BUT DOES NOT HAVE CONSISTENT VERIFIABLE INCOME. WHAT TYPE OF LOAN WOULD BE BEST FOR THIS SITUATION? a. an FHA loan b. a secured personal loan from a bank c. a VA loan d. an SBA loan
b
AN AGENCY TAKES A LISTING ON A COMMERCIAL PROPERTY. THE AGENCY FINDS A BUYER FOR HTE PROPERTY AND THE BUYER AND THE SELLER BOTH SIGN A CONTRACT FOR THE PURCHASE. PRIOR TO CLOSING, THE AGENT LEARNS THAT THE CITY PLANS ON PUTTING IN A RAMP ON THE BACK OF THE PROPERTY. WHAT SHOULD THE AGENT DO? a. not disclose to the seller so the seller has no liability b. disclose to the seller do the buyer can be informed c. disclose to the seller and then let the seller determine whether or not to disclose to the buyer d. disclose to the buyer only
b
FROM WHOM CAN A BROKER RECEIVE COMMISSION MONEY FROM ON A REAL ESTATE TRANSACTION? a. a residential property manager b. a commercial tenant c. an appraiser d. a lender
b
ON AN FHA LOAN, THE MORTGAGE INSURANCE (MIP) ENDS WHEN: a. the borrower dies b. the loan is paid in full c. the property is sold d. when the property is condemned
b
SELLERS WHO HIRE AGENTS TO REPRESENT THEM AND SELL THEIR PROPERTIES ARE: a. agents b. principals c. customers d. sub-agents
b
THE PROPERTY MANAGEMENT AGREEMENT IS BETWEEN THE PROPERTY MANAGER AND: a. his/her employer b. the property owner c. the tenants d. the lender
b
WHAT AUTHORIZES ONE PERSON TO ACT FOR ANOTHER PERSON? a. attorney-in-fact b. power of attorney c. estoppel certificate d. certificate of no defense
b
WHICH OF THE FOLLOWING IS TRUE REGARDING A REAL ESTATE COMMISSION? a. maximum commission rates are set by the government b. it is always negotiable between the seller and broker c. buyers normally pay the real estate commission d. it is illegal for both the seller and buyer to pay commission on the transaction
b
WHICH OF THE FOLLOWING STATEMENTS BEST DESCRIBES WHY SELLERS HIRE A REAL ESTATE AGENT TO SELL THEIR HOME? a. to sustain values for the area b. to produce a ready, willing and able buyer c. to allow the sellers to sell their property to persons of certain religion d. to help establish a sale price for the lender's appraiser
b
WHICH OF THE FOLLOWING TERMS BEST DESCRIBES THE SELLER IN AN AGREEMENT OF SALE? a. offeror b. vendor c. trustor d. mortgagor
b
WHY IS THE ANNUAL PERCENTAGE RATE (APR) HIGHER THAN THE INTEREST RATE? a. because the APR uses a calendar year and interest rate is computed based upon 360 days b. because the APR includes the finance charges the buyer pays in addition to the interest c. because the APR is quoted annually and the interest rate over 30 years d. because the APR includes the interest rate and the broker's commission
b
A LOAN WAS AMORTIZED FOR A 30-YEAR PERIOD. IF THE REMAINING LOAN BALANCE WAS DUE AT THE END OF 7 YEARS, THIS IS BEST DESCRIBED AS WHICH OF THE FOLLOWING: a. reverse annuity b. term note c. balloon payment d. amortized segment
c
A PERSON BUYS A PROPERTY OBTAINING A 30-YEAR MORTGAGE. AFTER A FEW YEARS, THE OWNER SELLS THE PROPERTY AND SES THE PROCEEDS TO PAY OFF THE LOAN. THE BEST WAY TO PROVE THAT THE MORTGAGE HAS NEED PAID OFF IS WITH A(N): a. mortgage defeasance clause b. quitclaim deed c. release or satisfaction of mortgage d. accurate copy of the final closing statement
c
A PROPERTY SOLD FOR $129,000 WITH THE BUYER PUTTING 20% DOWN. THE LENDER CHARGED 2 POINTS AND $750 CLOSING COSTS. WHAT IS THE TOTAL DUE FROM THE BUYER AT CLOSING? a. $2,814 b. $3,330 c. $28,614 d. $29,130
c
AN AGENT TOOK A LISTING IN WHICH THE SELLER SAID TO SELL IT IN "AS IS" CONDITION. THE AGENT THEN FOUND A MAJOR STRUCTURAL FLAW IN THE PROPERTY. WHICH OF THE FOLLOWING BEST DESCRIBES WHAT THE AGENT WHOULD DO. a. tell the buyer the property is sold "as is" b. not reveal the flaw unless asked by the buyer c. inform the buyer of the flaw d. not reveal the flaws as the agent is a fiduciary of the seller
c
FROM WHOM DOES THE SALESPERSON RECEIVE A COMMISSION? a. owner b. multiple listing service (MLS) c. the salesperson's broker d. a cooperating broker
c
THE BEST WAY TO DESCRIBE THE PURPOSE OF A MORTGAGE IS TO: a. promise payment for the loan b. secure the deed c. pledge property as collateral d. allow for interest rate adjustments during the term of the loan
c
WHAT DOES A BLANKET MORTGAGE COVER? a. both real and personal property b. more than one transaction c. more than one piece of property d. both the property and the appropriate mortgage insurance
c
WHAT IS THE PURPOSE OF A BORROWER PAYING FOR PRIVATE MORTGAGE INSURANCE (PMI)? a. to protect the seller in case the transaction did not close b. to protect the borrower's interest c. to insure the lender in case of default d. to insure the lender in case of casualty loss
c
WHICH OF THE FOLLOWING DUTIES WOU DBE OWED TO A CLIENT? a. care, obedience, and management b. honesty and fairness c. care, obedience, loyalty and disclosure d. fairness and accuracy
c
WHICH OF THE FOLLOWING ITEMS SHOULD BE THE LISTING SALESPERSON'S PRIMARY CONCERN WHEN THE SELLER IS FINANCING THE PROPERTY DIRECTLY TO THE BUYER? a. seller's current income b. terms of payment c. buyer's financial condition d. validity of title
c
WHICH OF THE FOLLOWING NORMALLY TRIGGERS A DUE-ON-SALE OR ALIENATION CLAUSE? a. failure to pay mortgage payments b. failure to pay taxes c. sale or assignment of the mortgaged property d. cancellation of the insurance
c
WHICH OF THE FOLLOWING TYPES OF MORTGAGE WOULD ALWAYS USE BOTH REAL ESTATE AND CHATTEL A SECURITY? a. equity b. blanket c. package d. wraparound
c
WHICH OF THE FOLLOWING WOULD CAUSE A PROPERTY TO BE CLASSIFIED AS STIGMATIZED? a. a crumbling foundation b. pink wallpaper through the house c. a murder had taken place in the basement d. a hidden roof leak
c
A MORTGAGE CLAUSE THAT STATES THAT THE MORTGAGE IS DUE AND PAYABLE UPON CERTAIN CONDITIONS, SUCH AS NON-PAYMENT, WOULD BE CALLED: a. prepayment b. subordination c. defeasance d. acceleration
d
A PRE-PAYMENT CLAUSE IN A MORTGAGE WOULD BE USED IN ORDER TO: a. prevent a buyer from being sold the mortgage being assumed by a new buyer b. give lenders interest before any liens are satisfied c. allow the lender to raise the interest rated based on criteria d. establish the terms and conditions if a borrower wants to pay off the loan early
d
A SELLER AND BUYER AGREED ON THE SALE AND PURCHASE OF A HOUSE. AS PART OF THE AGREEMENT, THE BUYER WAS TO TAKE OVER LIABILITY FOR THE SELLER'S EXISTING LOAN AS WELL AS THE PAYMENTS. THIS TYPE OF ARRANGEMENT WOULD BE A: a. subordination clause b. alienation clause c. subject to d. loan assumption
d
THE RIGHT OF A PERSON TO REGAIN TITLE TO PROPERTY AFTER PAYING ALL DEBTS IS KNOWN AS: a. release b. reversion c. remainder d. redemption
d
WHAT IS IT CALLED WHEN A BUYER PURCHASES A PROPERTY, MAKES MONTHLY INSTALLMENT PAYMENTS TO THE SELLER, AND RECEIVES THE DEED AFTER THE ENTIRE PURCHASE IS COMPLETELY PAID? a. an option b. a lease c. a right of first refusal d. an installment contact
d
WHICH OF THE FOLLOWING BUYS MORTGAGES IN THE SECONDARY MARKET? a. federal reserve b. department of veteran's affairs c. federal housing administration d. federal national mortgage association
d
WHICH OF THE FOLLOWING CALCULATIONS WOULD BE CORRECT FOR FIGURING WHAT A BUYER OWES AT CLOSING? a. total buyer credits minus seller debits b. total seller credits minus buyer debits c. total buyer debits less earnest money d. total buyer debits minus buyer credits
d
WHICH OF THE FOLLOWING DUTIES BEST DESCRIBES THE DUTY OF A PROPERTY MANAGER TO THE OWNER? a. fair b. honest c. accurate d. fiduciary
d
WHICH OF THE FOLLOWING STATEMENTS WOULD BE TRUE REGARDING A VETERAN'S ADMINISTRATION LOAN? a. the buyer must be currently active in the military b. the buyer must have a down payment of at least 5% c. the buyer can use the loan for the acquisition of a rental property d. the buyer must live in the property
d
