TUTOR EXAM - 4

The Pickets are purchasing a home for $780,000 and the lender is giving them a 90% loan at 5% interest, plus a 2% loan origination fee. How much is the loan origination fee?

$14,040

A tenant leased 3,000 square feet at $10 per square foot and 8% of gross income. The total annual rent she paid was $60,000. What was the gross income on which she paid percentage rent?

$375,000

A square is 1/8 of a mile by 1/8 of a mile. How many acres is this?

10 acres

A scale drawing shows a room to be 3 inches by 4-1/2 inches. Carpet, which is $15 per square yard, is to be installed in the room. If the scale is 1 inch to 4 feet, how much would it cost to install the carpet?

360

Which type of loan will result in the largest reduction of the principal balance most quickly?

6% over 15 years

Salesperson applicant Katherine is nervous about her upcoming real estate exam. What is the minimum score she needs in order to pass?

70%

Which is the best example of functional obsolescence?

A house with no electricity or running water

A real estate agent should tell the buyer, his customer, which of the following?

A pending or recent zoning change

A standardized yardstick expressing the true annual cost of borrowing is expressed as the what?

APR

Broker Bianca was guilty of converting $100,000 worth of trust funds. She was unable to pay and the Recovery fund had to pay the victim $50,000. What must Bianca do to continue selling real property?

Bianca's license is suspended until she pays the Recovery Fund back (with interest).

Which best describes why a buyer purchases a home using the market data approach?

Buyers buy after they compare the house with others.

In California, which of the following is true?

California is a community property state.

Which of the following is considered a conventional loan?

Commercial bank's 15 year loan

Discrimination is prohibited in lending practices under

ECOA

Who is NOT an originator of primary loans?

FHA

Who is the largest purchaser in the secondary market?

Fannie Mae

If a single parent is applying for a real estate loan, when would the fact have to be revealed that part of the parent's income is from child support?

If the parent was relying on the income for repayment of the loan

Which of the following is false regarding California's salesperson exam?

It is better not to guess if you are not sure, since you lose points for every wrong answer

Marjorie died intestate, leaving a large estate and no heirs. What is the most likely disposition of her property?

It will escheat to the state if no claims are made by possible heirs within five years.

Mrs. Jones, an appraiser, is appraising a single family residence for which she has located six closely comparable properties, all sold within the past six months. The subject property is rented for $1,500 per month. It is a custom-built home, approximately three years old. Mrs. Jones would probably give the most weight in her final estimate of value to which of the following appraisal methods?

Market data approach

Under an FHA graduated payment mortgage, which of the following fluctuates over the term of the loan?

Monthly payments

If advertised alone, which would be in violation of Truth in Lending?

No down payment required.

An owner advertised "beautiful acreage; only $5,000 down; owner will personally finance down payment." Would this be in violation of the Truth in Lending Act?

No. Owners are not covered by Regulation Z

A buyer assumes the mortgage. How is the owner relieved of the liability?

Novation

RESPA would prohibit which of the following acts?

Paying of kickbacks

In which of the following markets may a lender sell a loan that a mortgage banker has previously originated?

Secondary market

For a licensee acting on behalf of a mobile home owner, which of the following would NOT be a violation of license law?

Selling a mobile home that has been registered with HCD

Which transaction requires a securities license?

Selling shares in Fannie Mae

In most states, by paying the debt after a foreclosure sale, the mortgagor has the right to regain the property. What is this right called?

Statutory right of redemption

Which of the following would prevent a payout from the Recovery Fund?

The applicant has not tried to collect from the guilty licensee or employing broker

Which of the following would usually occur in a sale-and-leaseback transaction?

The property is sold on the condition that the new owner lease it back to the seller at the time title passes.

All of the following are true of conventional loans except what?

The qualification requirements are uniformly fixed by state law.

When the lender under a deed of trust requires title insurance, who would be the most likely person to pay for it?

The trustor

Which is true about restrictive covenants?

They are placed by private parties in a deed.

Why would a mortgagee have an appraisal on the property?

To assure the property value is sufficient to cover the loan

Why is the RESPA closing statement allowed to be examined on or before closing?

To check for mathematical errors

A veteran purchases a home under the Cal-Vet program. In such transactions, to whom is the deed issued?

To the California VA

An owner was selling his own home. Can he advertise the down payment?

Yes, because it was his own home.

The Rose family owns a home in a semi-rural area, which is about five years old. Recently announced plans for a new regional airport will place their home directly in line with a main runway ending 1 mile before their home. If the airport is constructed, will this diminish the value of the Rose Home?

Yes, because of economic obsolescence.

A buyer wanted to use a promissory note for consideration on the purchase of a property. Can he do this?

Yes. This is acceptable as long as the seller agrees.

In California, the appellate courts have accepted and enforced the common law rule that if any one of the four unities - time, title, interest or possession - is lacking,

a tenancy in common exists.

A buyer wants to take out an FHA loan. The broker should refer the buyer directly to

any approved lending institution such as a bank or savings and loan association.

The maximum permissible "loan to value ratios" are

based on sale price or appraised value, whichever is lower.

The primary purpose of Truth in Lending is to

disclose the true costs of obtaining credit.

Looking at shopping centers in the appraisal process, the social fiber of the community and distances from schools is called

neighborhood analysis.

Seller Jolita lists her house with Broker Fred. Fred then buys Jolita's house and collects the agreed-upon commission. This is an example of

self-dealing

Jacqueline suffered a large financial loss due to the wrongful act of Licensee Kristin in a real estate transaction. Jacqueline may receive payment of damages and arbitration from

the Recovery Fund.

The lender is required, under RESPA, to provide a detailed "Good Faith Estimate (GFE)" statement at the time of loan application or within three business days to

the buyer

A VA loan may be granted for the purchase of a one-family to four-family property if

the veteran agrees to live there.

A mortgage company makes a number of loans to be assembled into one package and sold to permanent investors. This process is an example of interim financing to the mortgage company and is called

warehousing