WRA Final Exam Practice
The penalty for knowingly or willfully violating the federal lead-based paint disclosure rules can be: A:$11,000 fine only B:$11,000 fine and imprisoned for up to one year, or both C:prison up to one year only D:10-year prison sentence
$11,000 fine and imprisoned for up to one year, or both Penalties for knowingly or willfully violating the federal lead-based paint disclosure rules can be up to $11,000 for each violation and imprisonment for up to one year, or both.
Four condominium units are valued at $200,000; $215,000; $220,000; and $225,000; a total value of $860,000. The four condominiums have an annual property maintenance fee $8,500. The amount of the property maintenance fee owed by each unit is based upon the unit's value in relation to the total value of all four units; what is the monthly maintenance fee of the most expensive unit? A:$184.17 B:$2,125.00 C: $177.08 D: $708.33
$184.17 The most expensive unit is $225,000. The total value of all the units is $860,000. $225,000 / $860,000 = .2616 or 26%. The annual maintenance fee for all the units is $8,500. $8,500 x .26 = $2,210 per year for the most expensive unit. $2,210/12 months determines the monthly maintenance fee of the most expensive unit is $184.17.
The owner of a property just found out that the municipality is going to be putting in sidewalks. The cost of the sidewalks is going to be assessed at $18.00 per linear foot. The owner has a 120-foot lot excluding the driveway. How much will the property owner's special assessment be? A:$2,160 B:$1,750 C:$2,000 D:$1,970
$2,160 120 feet x $18 = $2,160.
A borrower is obtaining a loan for $130,000. The loan is 95% of the property's value. The interest rate on the loan is 5% after the borrower pays two points. How much do the two points cost the borrower? A:$2,500 B:$2,600 C:$2,700 D:$2,800
$2,600 $130,000 principal loan amount x .02 = $2,600 cost of points.
A seller accepts an offer for $91,575 with a $10,000 mortgage carried by the seller for the buyer. After adjustments between the parties were made on the closing statement, the buyer ended up owing the seller $78,500 in cash on closing day. What was the amount of transfer tax paid by the seller? A:$244.80 B:$274.72 C:$235.50 D:$274.80
$274.80 $91,600 x .003 = $274.80.
The commission on the sale of 123 Anywhere Drive was $18,500, based on a 6.5 percent commission rate. What was the final selling price of the property? Use whole numbers. A:$28,462 B:$2,846,154 C:$2,846 D:$284,615
$284,615 $18,500/ .065 = $284,615.
A buyer purchases a property for $129,550. How much is the transfer fee for this transaction? A:$387.00 B:$388.80 C:$388.50 D:$388.65
$388.80 The transfer fee on a $129,550 purchase is $388.80. To calculate the transfer fee, round the purchase price up to the nearest $100 and multiply times .003. Round $129,550 up to $129,600 and multiply by .003 = $388.80.
Four condominium units are valued at $200,000; $215,000, $220,000; and $225,000. Together the annual property maintenance fees for the condominiums are $8,500. What is the total value of the units? A:$415,000 B:$868,500 C:$860,000 D:$465,000
$860,000 The total value of the four condominiums is $860,000.
Which of the following services may a licensee provide without an agency agreement? A:Advertise a seller's property on the Internet B:Write an offer to purchase C:Draft paperwork necessary to accomplish the instruction of the parties D:Answer a buyer's questions about the location of a property
Answer a buyer's questions about the location of a property Wis. Stat. § 452.135: No firm, and no licensee associated with a firm may provide brokerage services without an agency agreement that authorizes the firm to provide those brokerage services. Answering basic questions about a property does not constitute brokerage services. Subagents are authorized to participate in the transaction by the listing contract.
According to the WB-11 Residential Offer to Purchase who is responsible to pay special assessments levied against a seller's property after the date of the offer but prior to acceptance? A:Buyer B:Selling firm C:Seller D:Listing firm
Buyer Lines 416-418 of the WB-11 Residential Offer to Purchase.
The extension portion of the WB-1 Residential Listing Contract can be found on lines: A:205-219 B:151-158 C:220-224 D:159-166
C:220-224 This is the area of the listing contract that describes how the firm's listing contract is extended for a period of one year for protected buyers.
Jessica made her final mortgage payment to Bank of Money. Bank of Money will execute which of the following to reflect that Jessica has paid off her mortgage? A:Certificate of mortgage B:Release of mortgage deed C:Satisfaction of mortgage D:Promissory note
C:Satisfaction of mortgage satisfaction of mortgage is executed when a loan has been fully paid off
The WB-11 Residential Offer to Purchase indicates the seller shall provide title evidence in the form of: A:abstract of title B:gap endorsement C:title insurance D:warranty deed
C:title insurance Seller shall give evidence of title in the form of an owner's policy of title insurance in the amount of the purchase price.
Which of the following general warranty deed covenants guarantees the grantee's physical possession of the property will not be disturbed by former owners? A:Covenant against encumbrances B:Covenant of seisin C:Covenant of quiet enjoyment D:Covenant of warranty forever
Covenant of quiet enjoyment The definition of quiet enjoyment is the right to have uninterrupted use of the property without interference from former owners or tenants.
Four condominium units are valued at $200,000; $215,000; $220,000; and $225,000; a total value of $860,000. The four condominiums have an annual property maintenance fee $8,500. If the amount of the property maintenance fee owed by each unit is based upon the unit's value, what percentage of the total fee does the most expensive unit owe? A:25% B:26.5% C:3.8% D:26%
D:26% The most expensive unit is $225,000. The total value of all the units is $860,000. $225,000 / $860,000 = .2616 or 26%.
When comparing an appraisal to a market analysis which of the following is most correct? A:A market analysis takes value into consideration B:An appraisal determines value C:A market analysis is an objective opinion of value D:An appraisal justifies value by using past events
D:An appraisal justifies value by using past events An appraiser is trained to provide an unbiased estimate of value. The appraiser will justify the value of the real estate by looking at past events such as what have buyers paid for this type of property in the past.
Wisconsin fair housing laws prohibit discrimination in housing based on all of the following EXCEPT: A:marital status B:religion C:race D:conviction record
D:conviction record Conviction record is not a protected class under Wisconsin fair housing laws.
To ensure compliance with the lead-based paint (LBP) disclosure law, licensees: A:conduct lead-based paint testing on behalf of the buyer B:refuse to list the property unless the seller has a lead-free certificate for the home C:pay for a lead inspection D:must inform the seller of the seller's obligations under the federal LBP laws
D:must inform the seller of the seller's obligations under the federal LBP laws To ensure compliance with the LBP disclosure law, licensees must inform the seller of the seller's obligations under the federal LBP laws, ensure that the seller has performed all activities required by law, and provide the necessary disclosure documents for the seller to sign and provide them to the buyer as well.
Evelyn and her boyfriend, Noah, are getting married, and are looking to purchase a new home. They have asked you as their real estate licensee for advice on how to take title. What advice can you give them regarding on how they should take title? A:As tenants in common, so that each would have a one-half interest B:Suggest they speak to an attorney C:As joint tenants, so if one of them dies the other will get the property D:Suggest they speak to your supervising broker
Suggest they speak to an attorney Real estate licensees cannot give legal advice such as how to take title.
Which of the following is a CORRECT statement regarding Antitrust Laws? A:A conspiracy to restrain trade occurs when a firm independently decides to offer only buyer agency. B:When a company changes its commission structure the process should not be documented. C:The Sherman Antitrust Act was designed to maintain and preserve business competition. D:A conspiracy exists whenever a competing company acts according to an independent business decision.
The Sherman Antitrust Act was designed to maintain and preserve business competition. The Sherman Antitrust Act was designed to maintain and preserve business competition.
According to the Truth in Lending Act (TILA), what should be disclosed to a borrower? A:Financial statements of the mortgage company B:The annual percentage rate (APR) C:All liens and encumbrances on the property D:The name of the property insurance company that the borrower must use
The annual percentage rate (APR) The primary disclosures required under the Truth in Lending Act (TILA) are the financing charges, the annual percentage rate, the total amount financed, and total payments that will be made.
Who of the following should NOT sign a seller's real estate condition report? A:An engineer B:A seller C:A home inspector D:A listing licensee
A listing licensee Wis. Stat. § 709.02 Disclosures by Owners of Real Estate..."except that the owner may substitute for any entry information supplied by a licensed engineer, land surveyor or structural pest control operator or by an individual who is a qualified 3rd party or by a contractor about matters within the scope of the contractor's occupation if the information is in writing and is furnished on time and if the entry to which it relates is identified." A listing licensee should NEVER complete or sign a seller's real estate condition report.
Deadlines expressed as a number of days from an event, such as acceptance, are calculated by excluding the day the event occurred and by counting subsequent calendar days. When does acceptance occur? A:An offer to purchase that has been signed by all parties is delivered binding the parties B:One party tells another party that they have accepted the offer C:A licensee indicates an offer as being accepted in the MLS D:All parties have signed a copy of the offer to purchase
All parties have signed a copy of the offer to purchase The WB-11 Residential Offer to Purchase lines 43-44 states: "Acceptance occurs when all Buyers and Sellers have signed one copy of the offer, or separate but identical copies of the Offer."
A licensee offers payment for a buyer's home inspection. What is this offer from the licensee to the buyer called? A:Commission B:Fee-splitting C:A referral D:An incentive
An incentive Wisconsin allows incentives to be offered to buyers and sellers directly provided they are documented properly prior to closing. Such incentives may be offered in any amount in order to induce the buyers and sellers to purchase or sell.
Which of the following is NOT an essential term of a real estate sales contract? A:An inspection contingency B:The signatures of the parties C:The identity of the parties D:The price
An inspection contingency An inspection contingency is not an essential term of a real estate contract. Wis. Stat. § 706.02 Conveyance of Real Property requires the following of a contract: identifies the parties, identifies the land, identifies the interest conveyed and any material term condition, is signed by or on behalf of each of the grantors, is signed or joined in by separate conveyance by or on behalf of each spouse, and is delivered.
Firm A's supervising broker and Firm B's supervising broker were overheard at lunch discussing raising their commission rates. This is a violation of: A:MLS regulations B:RESPA C:company practice D:antitrust laws
antitrust laws The Sherman Act makes it illegal to conspire to restrain trade or the free flow of goods and services in a market place.
The WB-11 Residential Offer to Purchase does NOT have any information at lines 557 and 558. This means that: A:binding acceptance can only occur by delivery to the Party, not the agent B:the seller can determine how delivery will occur C:the buyer will accept delivery in any form D:the offer cannot be delivered
binding acceptance can only occur by delivery to the Party, not the agent The WB-11 states that delivery of documents and written notices to a Party shall be effective only when accomplished by one of the methods specified at lines 552-570. Even if the Parties select one or more methods of delivery, if a recipient is not named for delivery, then delivery can only occur to the Party.
A firm is allowed to act in a multiple representation relationship when: A:the seller agrees to multiple representation in the listing contract B:the offer to purchase is drafted by the Agent of Buyer and Seller C:both clients in the transaction consent in writing to the multiple representation D:the buyer consents to multiple representation in the buyer agency agreement
both clients in the transaction consent in writing to the multiple representation Wis. Stat. § 452.135(1) No firm may provide brokerage services to more than one client in a transaction without an agency agreement with each client and a written consent to multiple representation.
Acceptance occurs when all: A:buyers and sellers have signed an identical copy of the offer B:buyers and seller have signed different copies of the offer C:parties have signed the offer to purchase and it is delivered back to the buyer D:closing
buyers and sellers have signed an identical copy of the offer Lines 43-44 of the WB-11 Residential Offer to Purchase, "Acceptance occurs when all Buyers and Sellers have signed one copy of the Offer, or separate but identical copies of the Offer."
A firm has a contract with a person to pay a finder's fee if the person finds a buyer for the firm's listing. This is permissible if the: A:person is an unlicensed personal assistant B:person acts as a property manager for the listing C:person has a salesperson's license D:transaction closes
person has a salesperson's license Wis. Stat. § 452.19 No licensee may pay a fee or a commission or any part thereof for performing any act specified in this chapter or as compensation for a referral or as a finder's fee to any person who is not licensed under this chapter or who is not regularly and lawfully engaged in the real estate brokerage business in another state, a territory or possession of the United States, or a foreign country.
There are fair housing laws recognized at the federal, state, and local levels of government. A licensee should abide by the law: A:at the state level B:at the federal level C:at the local level D:that offers the most protection
that offers the most protection Local levels of government have the legal ability to enact fair housing laws as long as the local laws recognize the classes protected under the state law. However, not all local levels of government will have their own laws and unfortunately, some will have laws that contradict the state/federal law and allow discrimination under certain situations. A licensee must follow the law that offers the most protections.
Jimmy and Sara, a married couple, are selling their primary residence. Both Jimmy and Sara must sign all of the following EXCEPT: A:any amendments to the offer B:the listing contract C:the offer to purchase D:any deed transferring title
the listing contract The listing contract, unlike the other contracts, does not require the signature of both spouses in order to be valid. The courts have held that the party signing the contract is responsible for the commission. If only Jimmy signs the listing contract, Jimmy is stating that he alone is responsible for the commission.
A purchaser of real estate is entering into a land contract with the seller. The purchaser should expect legal title when: A:the land contract is recorded in public records B:making the first land contract payment to the seller C:the buyer takes possession of the property D:the seller has been paid in full
the seller has been paid in full A land contract is different from other types of financing in that legal title does not pass to the buyer during the term of the land contract. Legal title passes only when the seller is paid in full.
From the grantee's point of view, the best deed to receive is a: A:quitclaim deed B:personal representative's deed C:warranty deed D:deed in lieu of foreclosure
warranty deed The general warranty deed offers the most comprehensive guarantee of title. The grantor makes five promises to the grantee. They are the covenants of seisin, against encumbrances, further assurance, quiet enjoyment, and warranty forever.
Which of the following services should NOT be performed for a buyer-customer? A:Creating a market analysis of the property the buyer wishes to purchase B:Disclosing the fact that seller will not make the repairs called for in the offer by the deadline specified in the offer C:Refusing to provide legal advice regarding the validity of a contract D:Disclose the disadvantages of the seller's counter-offer when presenting it to the buyer
:Creating a market analysis of the property the buyer wishes to purchase A market analysis should not be performed for a buyer-customer. A licensee should provide market information to a buyer-customer that asks for it. This is typically accomplished by giving the buyer MLS datasheets, however; interpreting that data for the buyer is likely a violation of the loyalty duty owed to a seller.
Which of the following statements best describes the function of the VA guarantee, FHA mortgage insurance, and conventional private mortgage insurance? A:If the homeowner dies, the remaining mortgage will be paid off. B:If the lender forecloses, the lender is protected to some degree against potential loss. C:If the property declines in value, the buyer is guaranteed he will not suffer an equity loss. D:If the homeowner gets into financial difficulty, this coverage will make the monthly mortgage payment.
:If the lender forecloses, the lender is protected to some degree against potential loss. The VA guarantee, the FHA mortgage insurance and private mortgage insurance all protect the lender's risk when making a mortgage loan.
What is the purpose of a deed? A:It transfers title upon the death of a grantor B:It provides evidence of marketable title C:If delivered correctly it constitutes constructive notice D:It transfers legal title from a grantor to a grantee
:It transfers legal title from a grantor to a grantee A deed is a written instrument by which a grantor transfers ownership of the land to a grantee. The deed signals the end of ownership and the beginning of another.
"Time is of the essence" means that: A:The action required in the contract must be performed by the date stated in the contract or the party awaiting performance could call the contract void B:A breach of a stated deadline automatically voids the contract C:Under no circumstances will an extension of time be given if a date is missed D:The parties are given a reasonable time to perform upon breach of a stated date
:The action required in the contract must be performed by the date stated in the contract or the party awaiting performance could call the contract void Lines 88-93 of the WB-11 Residential Offer, "If 'Time is of the Essence' applies to a date or deadline, failure to perform by the exact date or Deadline is a breach of contract. If 'Time is of the Essence' does not apply to a date or Deadline, then performance within a reasonable time of the date or Deadline is allowed before a breach occurs."
A licensee is listing a 4-bedroom, two-story house. Which of the following would be the most suitable comparable property? A:A 3-bedroom, two-story house that was recently sold in the same neighborhood as the listed property B:A two-story mixed use property C:A 4-bedroom, two-story house that was recently foreclosed on D:A 4-bedroom, two-story house that is currently for sale in the neighboring town
A 3-bedroom, two-story house that was recently sold in the same neighborhood as the listed property A comparable property is a similar property currently being sold. The maximum value of a property tends to be established by value of similar properties that have recently sold. A foreclosed property does not provide a good comparison because it is not an arm's length sale.
What document does a seller use to convey ownership of personal property to a buyer? A:A bill of sale B:An abstract of title C:An evidence of ownership D:A warranty deed
A bill of sale A bill of sale is used to transfer ownership of personal property from one party to the new owner. You can think of a bill of sale as the "deed" for personal property. Ownership of real estate is transferred using a deed and ownership of personal property is transferred using a bill of sale.
Which of the following situations requires a written earnest money disbursement agreement prior to disbursement of funds when the earnest money is held by the listing firm? A:A party makes a counter-offer not acceptable to the other party B:The seller rejects the offer C:The seller has not accepted the offer and the offer has expired D:A buyer is not able to obtain financing
A buyer is not able to obtain financing The listing firm cannot do anything with the earnest money for 60 days after the scheduled closing date unless the parties reach a written agreement for the disbursement of the earnest money. The listing firm may wish to write a memorandum or letter to the buyer and seller and their respective attorneys, if any, pointing out lines 71-81 of the WB-11 Residential Offer to Purchase and explaining that this is how the earnest money disbursement must be handled. It is then up to the parties to work out their differences by negotiation or by going to small claims court.
A licensee is going to list a property improved with a structure. Which of the following statements best describes a licensee's inspection duties? A:A licensee needs to complete a reasonably competent and diligent inspection to detect observable, material facts. B:A licensee does not have an inspection obligation. C:A licensee needs to complete a reasonably competent and diligent inspection to detect observable, material adverse facts. D:A licensee needs to complete a reasonably competent and diligent inspection only if requested by the parties.
A licensee needs to complete a reasonably competent and diligent inspection to detect observable, material adverse facts. Wis. Admin. Code § REEB 24.07(1) A licensee, when engaging in real estate practice involves real estate improved with a structure shall conduct a reasonably competent and diligent inspection of accessible areas of the structure and immediately surrounding areas of the property to detect observable, material adverse facts.
According to the terms of the WB-1 Residential Listing Contract which of the following could be a protected buyer? A:A buyer who attended an open house B:A buyer who attended an individual showing C:A buyer who called the listing firm for the number of bedrooms D:A buyer who looked at the property on the MLS
A buyer who attended an individual showing According to the terms of the 2016 WB-1 Protected Buyers are defined on page 4 as, "a buyer who personally, or through any person acting for such buyer" 1) delivers to Seller or firm a written offer to purchase exchange or option on the Property during term of this listing; 2) views the property with the seller or negotiates directly with Seller by discussing with Seller the potential terms upon which buyer might acquire an interest in Property; 3) attends an individual showing of the Property only if firm delivers the buyer's name to Seller, in writing, no later than three days after the expiration of the Listing; 4) discusses with firm or cooperating firms the potential terms upon which buyer might acquire an interest in the Property, but only if the firm delivers the buyer's name to Seller, in writing, no later than three days after the expiration of the Listing. An open house is not an individual showing. If the firm wanted to have open house attendees be protected buyers, additional language would need to be included.
Which of the following real estate licensee is NOT required to ensure compliance with the federal LBP disclosure law? A:A buyer's firm paid by the buyer B:A selling licensee paid by the selling firm C:A selling firm receiving a commission from a cooperating firm D:A listing firm paid by the seller
A buyer's firm paid by the buyer Under the federal LBP law, an agent means any party who enters into a contract with a seller or lessor including any party who enters into a contract with a representative of the seller or lessor, for selling or leasing target housing. This term does not apply to purchasers or any purchaser's representative who receives all compensation from the purchaser.
Which of the following would a licensee have to disclose to all parties in the transaction? A:Receiving a referral fee from another licensee for the referral of a listing B:A buyer's licensee is representing the licensee's sister in the purchase of a property C:A buyer's firm is receiving commission from the buyer D:A seller is paying an incentive to a buyer at closing
A buyer's licensee is representing the licensee's sister in the purchase of a property A license acting as an agent in a real estate or business opportunity transaction may not act in the transaction on behalf of the licensee's immediate family without the prior written consent of all parties to the transaction. The buyer's licensee is an agent representing in this case a family member; therefore, they must disclose this interest.
Which of the following sales would need to include a lead-based paint addendum to the Offer to Purchase? A:Housing for the elderly built prior to 1978 B:A duplex built prior to 1978 C:Housing for persons with a disabling condition built prior to 1978 D:An efficiency apartment without bedrooms built prior to 1978
A duplex built prior to 1978 The LBP disclosure addendum is required on all transactions involving target housing. Target housing includes any housing built prior to 1978 except for housing for the elderly or persons with disabilities and 0-bedroom dwellings.
Housing that meets the Fair Housing Act's definition of "housing for older persons" may legally exclude: A:families with children B:individuals over the age of 62 C:families without children where all members are over the age of 65 D:an unmarried couple where both parties are over the age of 62
A:families with children If housing meets the Fair Housing Act's definition of "housing for older persons," then it may legally exclude families with children.
Which of the following likely constitutes secondary mortgage market fraud? A:A loan officer telling the seller and buyer to enter into a side agreement that will not be shared with the secured lender. B:A buyer applying for a loan even though it will be difficult to make the monthly payments. C:A real estate licensee drafting an amendment indicating that the seller will be escrowing cash at closing to pay for repairs. D:A seller agreeing to give the buyer a purchase money mortgage at closing.
A loan officer telling the seller and buyer to enter into a side agreement that will not be shared with the secured lender. Mortgage fraud occurs anytime a participant in a real estate transaction misrepresents facts with the intent to swindle another party of money. The key to committing mortgage fraud is keeping terms of a transaction away from the secured lender. Licensees should never draft paperwork that misrepresents the terms of a transaction and they are obligated to disclose all terms of a real estate transaction to the secured lender.
What is a planned unit development? A:A regulatory framework for protecting land near bodies of navigable water B:A process for a government to take private property for a public development C:A development where single family homes are owned as condominiums D:A regulatory process which promotes unified development for a development specially approved by the zoning authority for the developer
A regulatory process which promotes unified development for a development specially approved by the zoning authority for the developer A planned unit development (PUD) is a regulatory process which promotes large scale, unified land development by means of mid-range, realistic programs in chase of physically curable, social and economic deficiencies in land and cityscapes. A developer seeking to create a PUD must obtain approval for the relevant land use and zoning authorities.
Which of the following transactions must include a real estate condition report? A:New construction that has never been inhabited B:A transfer of property where the transfer is exempt from the transfer fee C:A personal representative selling property that the personal representative has never lived in D:A seller selling a duplex that the seller has never lived in
A seller selling a duplex that the seller has never lived in According to Wis. Stat. Chapter § 709 transactions involving the following properties are exempt from the real estate condition report requirements: property that has not been inhabited; transfers exempt from the Wisconsin transfer fee; transfers by personal representative, trustees, conservators, fiduciaries who are appointed by, or subject to the supervision by the court as long as the person has never occupied the property. There is NOT an exemption for a seller that does not live on the property or is not familiar with the condition of the property.
The Delivery of Documents and Written Notices section of the WB-11 Residential Offer to Purchase: A:allows the parties to designate alternative recipients for delivery by U.S. Mail B:requires that fees for commercial delivery always be prepaid to an account C:no longer allows personal delivery except by legal process server D:does not permit delivery by email
A:allows the parties to designate alternative recipients for delivery by U.S. Mail WB-11 Residential Offer to Purchase Lines 557-558 allow the parties to designate an alternative recipient for delivery of documents.
A seller is selling a condominium. What must accompany the seller's real estate condition report? A:A condominium addendum to the real estate condition report B:Floor plans of neighboring condominium units C:The names and phone numbers of units on either side of the seller's unit D:A copy of meeting minutes from the last three association meetings
A:A condominium addendum to the real estate condition report A seller of a condominium must provide a real estate condition report accompanied by an addendum to the condition report and an executive summary.
Which of the following is a duty owed ONLY to a client? A:Loyally represents interests B:Objective presentation of contract proposals C:Disclose material adverse facts D:Safeguard trust funds
A:Loyally represents interests The duties owed to a CLIENT include: Loyally represent the client's interest, provide information and advice on matters that are material to the client's transaction, disclose all material information, fulfill any obligation required by the agency agreement that is not in conflict with the law, and the duty to negotiate on behalf of the client, unless waived.
A Listing Contract is signed July 1, 2016. An Offer is presented to the seller on July 14, 2016 and the seller accepts the Offer July 15, 2016. The transaction closes on September 15, 2016. The listing firm must keep transaction documents for this transaction until: A:September 15, 2018 B:July 14, 2018 C:July 15, 2018 D:July 1, 2018
A:September 15, 2018 Wis. Admin. Code § REEB 15.04: A firm shall retain for at least two years exact and complete copies of all listing contracts, offers to purchase, leases, closing statements, deposit receipts, cancelled checks, trust account records and other documents or correspondence received or prepared by the firm in connection with any transaction. The retention period shall run from the date of closing of the transaction.
Which of the following is not considered real property? A:Farm equipment B:Fences C:Growing shrubs D:Built-in appliances
Farm equipment Shrubs, bulbs, trees, fences, and built-in appliances are all considered real property. Farm equipment, because it is not attached, is considered personal property like a car, trailer, or snowmobile.
A licensee with a plumbing background notices a defect with a seller's plumbing that is not mentioned on the Real Estate Condition Report or the home inspection report. What should the licensee do? A:Inform the listing firm so the firm can update the seller's condition report B:Inform the seller and ensure that the real estate condition report is amended to reflect the defect C:Inform the buyer and seller in writing of the defect D:Inform the buyer's attorney so the buyer's rights are protected
Inform the buyer and seller in writing of the defect Wis. Stat. § 452.23(3) A licensee shall disclose to the parties to a real estate transaction any facts known by the licensee that contradict any information included in a written report. Wis. Stat. § REEB 24.07(2) A licensee when engaging in real estate practice, shall disclose to each party, in writing and in a timely fashion, all material adverse facts that the licensee knows and that the party does not know or cannot discover through a reasonably vigilant observation, unless the disclosure of the material adverse fact is prohibited by law.
When a depository institution remits the interest earned on a firm's interest-bearing trust account to the Department they must inform the firm of all the following EXCEPT the: A:Account balance B:Service charges on the account C:Interest earned on the account D:Rate of interest applied to the account
Interest earned on the account Wis. Stat. § 452.13(2)(e)(1) When a depository institution remits interest to the Department they must furnish to the firm maintaining the interest-bearing trust account the rate of interest applied, the amount of service charges or fees deducted, if any, and the account balance for the period that the statement covers. The firm does not receive information on the interest that was actually paid.
What type of mortgage law is recognized in Wisconsin? A:Lien theory B:Abstract theory C:Intermediate theory D:Title theory
Lien theory Under lien theory, the buyer has legal title and the lender has the right to place a lien on the buyer's property given as collateral for the loan.
On what line does the buyer indicate they wish the seller to pay for a gap endorsement as part of the title insurance policy? A:Line 300 B:Line 390 C:Line 362 D:Line 400
Line 400 A buyer would indicate on line 400 of the WB-11 Residential Offer to Purchase that they wish for the seller to provide a gap endorsement at the seller's cost.
Which of the following allows a property owner to use property in a way that was once allowed but is no longer permitted under current zoning regulations? A:Nonconforming use B:Variance C:Spot zoning D:Conditional use
Nonconforming use A nonconforming use is a use of property was once permitted but is no longer permitted under current zoning regulations. The use is considered "grandfathered" in and the property owner can preserve nonconforming use status by continuing to use the property in the nonconforming way. An agent can list and sell a nonconforming use and the new owner typically needs to use the property in the same way to preserve the status as a nonconforming use.
A property protected under the WB-36 Buyer Agency Agreement Extension of Agreement Term is protected for how long after the expiration of the contract? A:Two years B:Six months C:One year D:18 months
One year Lines 252-257 Extension of the Agreement Term of the WB-36 Buyer Agency Agreement provides, "The Agreement term is extended for a period of one year as to any property The Agreement term is extended for a period of one year as to any Protected Property under this Agreement. Upon receipt of written request from Client or a firm that has a new buyer agency or tenant representation agreement with Client, the Firm agrees to promptly deliver to Client a written list of those Protected Properties known by the Firm and its agents to which the extension period applies. Should this Agreement be terminated by Client prior to the expiration of the term stated in this Agreement, this Agreement shall be extended for Protected Properties, on the same terms, for one year after the Agreement is terminated (lines 243-251)."
Which of the following is established by the time and date a document was recorded? A:Marketable title B:Priority C:Chain of title D:Quit claim
Priority The date and time of recording a document establishes priority. For example, the priority of liens is established by the date and time the lien is recorded.
Which of the following are NOT considered client funds? A:Advanced fees B:Earnest money C:Downpayments D:Promissory notes
Promissory notes Wis. Stat. § 452.13(a) "Client funds" means all downpayments, earnest money deposits, or other money related to a conveyance of real estate that is received by a licensee on behalf of a firm or any other person. "Client funds" does not include promissory notes.
Which of the following activities requires a real estate license? A:An adult child helping an elderly parent with the sale of their home B:Receiving compensation to procure a buyer for another person's business C:A property manager showing a rental unit D:A personal representative selling the real property of an estate
Receiving compensation to procure a buyer for another person's business Wis. Stat. § 452.01(d) A broker means any person who for another and for a commission, money or other thing of value, negotiates or offers or attempts to negotiate a sale, exchange, purchase or rental of any business, its goodwill, inventory, fixtures or an interest therein.
Which statement best explains why instruments affecting real estate, such as deeds or easements, are recorded in the register of deeds in the county where the property is located? A:Wisconsin real estate law requires interested parties to record instruments affecting real estate. B:Recording is mandatory to comply with the statute of frauds. C:A property cannot be transferred in whole or in part unless the documents are recorded. D:Recording gives constructive notice to the world of the rights and interests in a parcel of real estate
Recording gives constructive notice to the world of the rights and interests in a parcel of real estate Recording instruments affecting real estate such as deeds or easements give constructive notice to the world of the rights and interests in a parcel of real estate.
A seller lists a house with Salesperson A. A buyer attends Salesperson A's open house and decides to write an offer after signing a buyer agency agreement with Salesperson A. Which of the following correctly identifies the relationship between the buyer, the seller, and Salesperson A? A:Salesperson A has a single agency relationship with the buyer. B:Salesperson A has a multiple representation relationship. C:Salesperson A has a single agency relationship with the seller. D:Salesperson A has created an illegal relationship with the seller and the buyer.
Salesperson A has a multiple representation relationship. The buyer and the seller each have a signed agency agreement with Salesperson A, thus creating a multiple representation relationship.
Which of the following activities can an unlicensed personal assistant do? A:Attend showings B:Complete an offer for a buyer C:Schedule appointments D:Conduct an open house
Schedule appointments An unlicensed personal assistant cannot do any activities that would require a real estate license such as showings, open houses, or completing forms. An unlicensed assistant can complete activities that do not require a license such as scheduling appointments.
In the WB-1 Residential Listing Contract, who has the authority to accompany a home inspector during a home inspection? A:An appraiser B:The buyer C:The buyer's attorney D:The buyer's parents
The buyer The WB-1 Residential Listing Contract authorizes the buyer to accompany a home inspector during the inspection.
An offer is written and subsequently rejected. The buyer gave earnest money with the offer. What would be the proper procedure to return the earnest money? A:The earnest money can be returned after an amendment to the offer to purchase is signed directing the listing firm to return the earnest money to the buyer. B:The earnest money can be returned after a Cancellation Agreement and Mutual Release is signed. C:The earnest money can be returned to the buyer. D:The earnest money can be returned after an earnest money disbursement agreement is signed by both the seller and the buyer.
The earnest money can be returned to the buyer. Generally, the firm must deposit earnest money in a real estate trust account within 48 hours of receipt. Wis. Admin. Code Chapter REEB 18 allows for the disbursement of trust funds upon rejection, expiration or withdrawal, prior to binding acceptance, of an offer to purchase, Therefore, if the offer is rejected, withdrawn or expires prior to the 48 hours, the firm may return earnest money to the buyer. It would be prudent practice to make a photocopy of the earnest money check and document the return.
A licensee is working with a deaf individual. The individual needs an interpreter to understand the real estate contracts. Who is required to pay for the interpreter? A:The buyer B:The firm C:The seller D:Housing and Urban Development
The firm A public accommodation must provide auxiliary aids to individuals with disabilities who have physical or mental impairments, such as vision, hearing, or speech impairments that substantially limit the ability to communicate. A real estate office is a public accommodation and is required to incur the expense of the auxiliary aid unless it results in an undue burden
A buyer wants to have the interest earned on their earnest money deposit. Which of the following statements is most correct? A:The firm can give the interest to the buyer with written permission from the seller. B:The firm cannot hold the earnest money but they may draft an escrow agreement for the buyer and the seller C:The firm can give the interest to the buyer if the offer to purchase states that the buyer gets the interest. D:The firm cannot draft an escrow agreement for the buyer and seller.
The firm cannot draft an escrow agreement for the buyer and seller. Wis. Admin. Code § REEB 18.06 If the parties to a transaction do not desire that the firm hold the earnest money in the firm's real estate trust account, and wish to designate an escrow agent other than the firm, the firm may not draft the escrow agreement. The escrow agreement shall be drafted by the parties or an attorney. The firm may not hold the funds in the firm's real estate trust account, nor may the firm act in any way as custodian of the funds for the parties. The funds, pursuant to the escrow agreement, shall be held by some other party, such as a bank, a savings and loan association, a credit union, or an attorney.
A borrower is obtaining an adjustable rate loan where the initial rate is fixed for three years. After the initial period, the loan will adjust every six months. What is the borrower's initial principal and interest payment is based upon? A:An approximation of the interest rate in three years B:The interest rate at which the ARM is originated C:The interest rate obtainable for a 30 year fixed loan D:The interest rate at which the loan is originated plus two points
The interest rate at which the ARM is originated When calculating a principal and interest payment for an adjustable rate loan, one would use the interest rate at which the loan is originated.
Which of the following is CORRECT regarding a property owner who holds a real estate license? A:The property owner may place security deposits into a real estate trust account. B:The property may automatically place security deposits into their personal account. C:The property owner must pay interest on the security deposit equal to the standard interest rate paid at a federal reserve member bank. D:The property owner may spend the security deposits as long as they have the money available at the end of the lease
The property owner may place security deposits into a real estate trust account. Wis. Admin. Code § REEB 18.031 A licensee having an ownership interest in a rental property shall either place security deposits related to that property in a real estate trust account or shall provide in a lease for security deposits to be held in an account maintained in the name of the owner or owners.
What would a buyer's licensee NOT have to disclose to the buyer-client? A:There are negotiation strategies that may benefit the buyer more than the seller. B:There is a leak in the basement. C:The property the buyer is interested in purchasing will be difficult to sell in the future. D:The sellers are getting divorced and need to sell the house quickly.
The sellers are getting divorced and need to sell the house quickly. The sellers' divorce is the sellers' confidential information and cannot be disclosed to the buyer.
The WB-11 Residential Offer to Purchase describes which of the following as the way an earnest money payment should be handled as a result of a sale involving cooperating firms where the listing firm will hold the earnest money? A:In a transaction involving cooperating firms, the listing firm should transfer the earnest money to the selling firm within 24 hours of receiving bank clearance. B:The selling licensee holds all checks or cash received as earnest money until the time of closing. C:The selling licensee should have all earnest money checks paid directly to the listing firm. D:The selling licensee should transfer the earnest money to the listing firm within 24 hours of the accepted offer to purchase.
The selling licensee should have all earnest money checks paid directly to the listing firm. f the listing firm is holding earnest money, the cooperating firm should have initial and additional earnest money payable to the listing firm.
A licensee drafts an offer on behalf of some buyers. The husband is not available to sign the offer so tells his wife to sign his name. The offer was delivered back to the buyer. What is the status of the offer? A:Valid B:Unenforceable C:Voidable D:Void
Void The offer is void. There was never a contract because the essential elements of the contract were never met. Wis. Stat. § 706.02 states that a contract to convey must be signed by or on behalf of all parties and 706.03(1m) states that a conveyance signed by one purporting to act as agent for another shall be ineffective as against the purported principal unless such agent was expressly authorized, and unless the authorizing principal is identified as such in the conveyance or in the form of signature. If the wife had written permission to act as the husband's principal and indicated such on the offer then there would be a binding contract.
Which of the following does the Department of Natural Resources (DNR) describe as providing critical habitat for wildlife, water storage to prevent flooding and protect water quality, and recreational opportunities for wildlife watchers, anglers, hunters and trappers and boaters? A:Wetlands B:Water frontage C:Shorelands D:Piers
Wetlands The DNR describes wetlands as providing critical habitat for wildlife, water storage to prevent flooding and protect water quality and recreational opportunities for wildlife watchers, anglers, hunters and trappers and boaters.
At what point in the real estate transaction does a buyer receive equitable title? A:At closing B:When the offer is accepted C:When binding acceptance occurs D:When all contingencies have been removed
When all contingencies have been removed Equitable title is the right to obtain absolute ownership to property when legal title is held in another's name. A buyer obtains equitable title after all contingencies have been removed and they are ready to consummate the transaction.
Bob changed his mind about purchasing 456 Right Here Avenue. The seller has accepted the offer. The offer has not been delivered to Bob. What is the effect on the transaction if Bob's license calls the seller and says the deal is off? A:Rejection of the offer B:Breach of contract C:Counter-offer D:Withdrawal of the offer
Withdrawal of the offer A buyer may withdraw an offer any time prior to binding acceptance.
A builder completed a new home and is going to live in it for 3 weeks prior to closing of the sale to a buyer. Must the builder complete a real estate condition report? A:Yes, because the property meets the definition of one-to-four dwelling units. B:No, because the property is new construction and is exempt. C:No, because the property is not listed with a firm. D:Yes, because the property will establish a pattern of sales for the builder.
Yes, because the property meets the definition of one-to-four dwelling units. Sellers of vacant land or real estate containing one-to-four dwelling units, whether listed with a firm or for sale by owner, are required to complete a real estate condition report. There is an exemption for a property that has never been lived in but if the builder is living in the home prior to closing, the builder is not exempt and must complete a real estate condition report.
When a listing firm lists a property, the seller is: A:an employee B:an agent C:a client D:a customer
a client In a listing contract, the seller is the one who has hired the firm. Thus, the seller would be the principal/client in a listing contract.
All of the following may legally terminate a listing contract EXCEPT: A:condemnation B:fulfillment of purpose C:mutual consent D:a rise in interest rates
a rise in interest rates A rise in interest rates may make a property more difficult to market but it would not legally terminate the listing.
If a buyer wanted their second counter-offer to include the first three items discussed in their first counter-offer to seller, the buyer: A:can state any other terms in the second counter-offer and incorporate the first three items of the buyer's first counter-offer by reference B:must write a new offer C:would reissue the first counter-offer along with a multiple counter-offer to incorporate any additional changes D:cannot resubmit these provisions because seller has previously rejected them
can state any other terms in the second counter-offer and incorporate the first three items of the buyer's first counter-offer by reference The entire agreement between the parties is found in the offer to purchase and the most recent counter-offer. Therefore, any provisions that are acceptable must be incorporated either word for word or by reference from one counter-offer to the next.
The reason for including expired properties in a market analysis is to show the sellers that: A:comparable properties could not support an above-market list price B:their neighbors' properties are not comparable C:the seller cannot substitute the value of their neighbor's house D:the competition cannot sell their listings
comparable properties could not support an above-market list price Expired properties are usually priced above market value and may help convince an unrealistic seller of a more realistic list price.
The right held by utility company to install a gas line across another's property is likely a(an): A:encroachment B:judgment C:easement D:lien
easement An easement is the right held by one party to make use of the land of another for a limited purpose. Utility easements are common on privately held property.
The right of a governmental body to take ownership of real estate for public use is called: A:police power B:escheat C:condemnation D:eminent domain
eminent domain Eminent domain is one form of police power and is the power of a governmental body to take ownership of real estate for a public use.
Elements reserved for the exclusive use of one or more, but not all members of a condominium are called: A:limited common elements B:declarations C:common elements D:deed restrictions
limited common elements Limited common elements are elements that are reserved for one or more unit owners and are not available for use by all the unit owners as are common elements.
A licensee is required to disclose: A:that the property was the site of a specific act or occurrence, if the act or occurrence had no effect on the physical condition of the property or any structures located on the property B:the location of any adult family home, community-based residential facility, or nursing home in relation to the property C:material inconsistent with or materially contradictory to the seller's statements or the inspection report of a third party D:the information disclosed on third party inspection reports
material inconsistent with or materially contradictory to the seller's statements or the inspection report of a third party Wis. Admin. Code § REEB 24.07(6): If a licensee's reasonably and diligent inspection reveals facts materially inconsistent with or materially contradictory to the seller's statements or the inspection or investigation report of a third party, the inconsistency shall be disclosed in writing and in a timely manner to the parties.
When acting as a buyer's agent, a license must disclose buyer agency to all parties or risk a claim of: A:misrepresentation B:Fair Housing violations C:RESPA violations D:HUD violations
misrepresentation Failing to disclose an agency relationship with a buyer could lead to a claim of misrepresentation against a license if the seller or listing firm thought the licensee was acting as a selling firm.
The listing contract states that the washer and dryer are included in the sale. The offer to purchase does not mention the washer and dryer anywhere. At the time of closing the washer and dryer: A:are included in the sale B:will be purchased separately C:must be on the property D:must be removed
must be removed Lines 482-486 of the WB-11 Residential Offer to Purchase state "At time of Buyer's occupancy, Property shall be in broom swept condition and free of all debris, refuse, and personal property belonging to current tenants, or that sold to Buyer or left with Buyer's consent." The offer to purchase determines what property is included or excluded in the transaction. Since the washer are dryer are personal property if they are not addressed in the offer to purchase they must be removed at closing.
The duties to all parties include all of the following EXCEPT: A:negotiation B:safeguard trust funds C:provide brokerage services with reasonable skill and care D:disclosure of material adverse facts
negotiation Duties to all parties: Safeguard trust funds, provide brokerage services honestly and fairly, present contract proposals in an objective and unbiased manner, confidentiality, provide accurate information about market conditions within a reasonable time after the person's request, provide brokerage services with reasonable skill and care, disclosure of material adverse facts. The duty of negotiation is just for clients.
A listing firm and a seller can modify an Exclusive Right to Sell Listing Contract to create any of the following EXCEPT: A:open listing B:exclusive agency C:one-party listing D:net listing
net listing Wis. Admin. Code § REEB 24.10: Licensees shall not obtain, negotiate or attempt to obtain or negotiate any listing contract providing for a stipulated net price to the owner with the excess over the stipulated net price to be received by the firm as commission. Wis. Admin. Code § REEB 16.06(6): A licensee may alter an approved exclusive right to sell listing contract to create an exclusive agency listing or an open listing.
If a licensee is asked about the existence of any known sex offenders in the area, to achieve immunity from having to disclose this information, the licensee may: A:ignore the question B:provide the Department of Corrections' contact information in writing C:ask the seller to interview neighbors to find out if they are sex offenders D:never have immunity from such disclosures
provide the Department of Corrections' contact information in writing Wis. Stat. § 452.24 Disclosure duty; immunity for providing notice about the sex offender registry. (1) If, in connection with the sale, exchange, purchase or rental of real property, a licensee receives a request from a person to whom the licensee is providing brokerage services in connection with the sale, exchange, purchase or rental for information related to whether a particular person is required to register as a sex offender under s. 301.45 or any other information about the sex offender registry under s. 301.45, the licensee has a duty to disclose such information, if the licensee has actual knowledge of the information. Notwithstanding sub. (1), the licensee is immune from liability for any act or omission related to the disclosure of information under sub. (1) if the licensee in a timely manner provides to the person requesting the information written notice that the person may obtain information about the sex offender registry and persons registered with the registry by contacting the department of corrections. The notice shall include the appropriate telephone number and Internet site of the department of corrections.
A tree growing near the corner of a lot is ordinarily considered: A:personal property B:a security interest C:real property D:an encroachment
real property A tree is permanently affixed to the property. That makes it real property.
A lender is in the practice of restricting the number of loans or the loan-to-value ratio in certain areas of a community. This is a violation of fair housing law and is called: A:redlining B:blockbusting C:discounting D:steering
redlining Redlining is restricting the number of loans or the loan-to-value ratio in certain areas of a community. The decisions on whether or not to issue a loan or a homeowners insurance policy must be made on the creditworthiness of the individual not the location of the property.
Discount points enable a borrower to: A:reduce the term of the loan B:reduce the principal of the loan C:reduce the initial interest rate of the loan D:buy a house with less money down
reduce the initial interest rate of the loan The buy down provisions on a loan allow the borrower to pay points. The borrower purchases points to originate a loan at a lower than market interest rate.
A selling licensee can receive a commission from the: A:selling firm B:buyer C:buyer's firm D:seller
selling firm Wis. Stat. § 452.14(3)(f) Disciplinary proceedings shall be conducted by the board if it finds that a licensee accepted from any person except the firm with which the licensee is associated, if the licensee is associated with a firm, a commission or valuable consideration for the performance of any act specified in this chapter or as compensation for referring a person to another licensee or to any other person in connection with a transaction.
A city zoning board changes the zoning for a single parcel of property to meet a public need. This would be called: A:nonconforming use B:spot zoning C:downzoning D:a variance
spot zoning Spot zoning occurs when a single parcel of land rezoned. A variance allows a parcel to violate permanently a zoning law. Downzoning changes the use of all the properties within a zoning district.
Chain of title refers to: A:an insurance policy that protects the holder from challenges to the policyholder's ownership B:a summary or history of all instruments and legal proceedings affecting a specific parcel of land C:a series of links measuring 7.92 inches D:the succession of conveyances from some starting point whereby the current owner derives title to the real estate
the succession of conveyances from some starting point whereby the current owner derives title to the real estate The chain of title for a property is the succession of conveyances from some starting point whereby the current owner derives title to the real estate. A chain of title may start with the original grant of ownership from the United States to the first private owner and all subsequent conveyances up to the current owner.
Licensees shall advertise in a manner which is: A:false B:misleading C:deceptive D:true
true Licensees shall not advertise in a manner that is false, misleading, or deceptive.
