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Quiz on National Real Estate Exam , created by chantelle cotnoir on 14/11/2017.

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National Real Estate Exam

National Real Estate Exam

Question 1 of 76

1

A licensee was showing property in an 8 unit complex to a prospective tenant using a motorized wheelchair. The tenant wanted to rent a unit, install grab bars in the bathroom, and lower all door handles. The landlore

Select one of the following:

  • can allow the tenant to make these modifications and pay for them to be made

  • can refuse to rent to the individual because it would devalue the property

  • must allow the tenant, at the tenant's expense, to make the modifications, but cannot require restoration at the end of the lease

  • must allow the tenant to make the modifications at the tenant's expense, but can require, by the terms of the lease, restoration of the property

Explanation

Question 2 of 76

1

Which of the following is the best description of a fee simple estate?

Select one of the following:

  • ownership of a property that extends for the period of a person's life

  • the most complete ownership in property that one can obtain

  • interest in a property for which a party to the transaction has paid a fee

  • interest in a property for which the leasehold estate is supported by consideration

Explanation

Question 3 of 76

1

A licensee plans to send out an email offering his services. According to the CAN-SPAM Act, the licensee must

Select one of the following:

  • include only the brokerage firm's name in the "Reply-To" line

  • email individuals who have given prior permission to be emailed

  • hire a company to market services

  • tell recipients how to opt out of receiving future emails

Explanation

Question 4 of 76

1

The owner of an apartment building has just signed an agreement with a real estate firm. Has an agency been formed?

Select one of the following:

  • No, because an agency is formed only with a listing agreement between a seller and real estate licensee

  • No, because an agency with a licensee is formed only in situations of buying and selling, not managing, real estate

  • Yes, because an agency is formed whenever one party delegates to another the right to act on his behalf in certain business transactions

  • Yes, because an agreement between a property owner and a property manager creates a universal agency

Explanation

Question 5 of 76

1

The most typical purpose of a deed restriction is to

Select one of the following:

  • ensure that the property will not be encumbered

  • encourage varied uses of the property

  • control future uses of the property

  • limit costs of new houses in a subdivision

Explanation

Question 6 of 76

1

A managing broker requires his licensees to mention a particular lender to buyers. The broker has a financial interest in this particular mortgage lender. which of the following should the licensee recommend to buyers?

Select one of the following:

  • Use this lender for the best rate

  • Seed advice from an accountant before selecting a lender

  • Contact other lenders in the area before contacting this lender

  • Consider this lender, disclosing the broker's interest, and other lenders

Explanation

Question 7 of 76

1

A couple leased a waterfront bungalow. The lease began on June 15 2010, and continued through July 31 2010. The couple had

Select one of the following:

  • a tenancy at will

  • a tenancy by entireties

  • an estate for years

  • a holdover tenancy

Explanation

Question 8 of 76

1

A licensee anxious to make a sale violates his duties toward his principal if he volunteers which of the following pieces of information to a prospective buyer?

Select one of the following:

  • You should make an offer for less than the listing price because the owner is anxious to sell

  • If anything in the contract is changed by my client, you have the option of accepting or rejecting the counteroffer

  • You can get your earnest money deposit back if the offer of financing is rejected

  • This house has been listed for 5 months and 10 days

Explanation

Question 9 of 76

1

An owner obtains a new mortgage on her house because the house has appreciated in value and she wants money for an investment. The new mortgage rate is 1% lower than the old rate. What is this process called?

Select one of the following:

  • Refinancing

  • Disintermediation

  • Rollover

  • Subordination

Explanation

Question 10 of 76

1

An enforceable purchase agreement is formed when

Select one of the following:

  • both parties have orally accepted the agreement

  • the seller makes a counteroffer

  • the buyer knows of the seller's written acceptance of the offer

  • the earnest money is paid

Explanation

Question 11 of 76

1

Which of the following is generally income tax deductible in home ownership?

Select one of the following:

  • down payment on the property

  • major home improvements

  • points paid to obtain the loan

  • maintenance on the property

Explanation

Question 12 of 76

1

Which of the following is true concerning eminent domain?

Select one of the following:

  • the property must be used solely for recreation

  • the property is taken through the process of condemnation

  • the owner must be paid based on the mortgagor's perceived value

  • the property owner is not compensated for the property

Explanation

Question 13 of 76

1

When a borrower defaults on a mortgage, an acceleration clause allows the lender the option of

Select one of the following:

  • attaching the borrower's personal property

  • demanding immediate payment of the entire loan balance

  • reporting the borrower to both the FHA and the VA

  • preventing conveyance of the mortgaged property

Explanation

Question 14 of 76

1

An owner has been asked to grant a 60-day option to purchase property. When should the purchase price be decided?

Select one of the following:

  • upon creation and signing of the offer to purchase

  • at the closing

  • at any time during the 60-day option period

  • within the last 10 business days of the 60-day option period

Explanation

Question 15 of 76

1

Which of the following is true about prepayment penalties on VA or FHA loans for single-family dwellings?

Select one of the following:

  • the VA requires a prepayment penalty of 2% of the outstanding loan balance

  • the FHA requires a prepayment penalty of 2% on the principal amount

  • Both the VA and the FHA require prepayment penalties of 3% of the outstanding loan balance

  • neither the VA not the FHA allows prepayment penalties

Explanation

Question 16 of 76

1

When managing property, which of the following actions is legal?

Select one of the following:

  • refusing to rent to families with children

  • requiring a power of attorney from all prospective tenants

  • collecting larger security deposits from all prospective tenants with support animals

  • obtaining information from prospective tenants to determine if they are financially able to afford rent

Explanation

Question 17 of 76

1

A licensee is representing prospective buyers. The licensee orally informed buyers that the developer would be paving streets in front of a house in a rural subdivision. The licensee had not verified this but assumed that it was true because the developer had done the paving in similar subdivisions. The buyers relied on the licensee's statement in deciding to buy the house. If no contract exists spelling out paving responsibilities, who can be held responsible for the damages?

Select one of the following:

  • the developer because it is a developer's responsibility to pave streets up to existing arteries

  • the licensee because his unverified statement was misrepresentation

  • the county because it has jurisdiction over roads in rural areas

  • no one because no written promise of street paving was made by either the licensee or the developer

Explanation

Question 18 of 76

1

Which of the following is a characteristic of a limited partner's role in a limited partnership?

Select one of the following:

  • reduced personal liability and no management decision making

  • a fixed return on investments and a loss of income tax on write-offs

  • official anonymity with certain tax exemptions and a loss of annual profits exceeding 20% of the investment

  • authority over larger decisions and active interest investment potential

Explanation

Question 19 of 76

1

For a real estate contract to be valid, it must include

Select one of the following:

  • options

  • contingencies

  • consideration

  • a rescission clause

Explanation

Question 20 of 76

1

A home equity line of credit it

Select one of the following:

  • for a 30-year term

  • fully tax deductible

  • a secured loan

  • available on rental property

Explanation

Question 21 of 76

1

Which of the following factors tends to increase the price of residential real estate in a given area?

Select one of the following:

  • a zoning change allowing a group home

  • a large manufacturing plant opening in the city

  • higher interest rates on home loans

  • an abundance of homes in a preferred area

Explanation

Question 22 of 76

1

A buyer made an offer on a property and the seller accepted the offer. A week later, the seller asked the licensee to amend the contract's provision for closing from 60 days to 90 days. The licensee completed the amendment and all the parties initialed the change. The buyer now asks if the seller would agree to split the cost of any needed repairs found during the home inspection. Which of the following would be prepared to include this provision?

Select one of the following:

  • an amendment

  • an addendum

  • a unilateral contract

  • a bilateral contract

Explanation

Question 23 of 76

1

Four people bought an investment property together, each having equal ownership interest. They took title in such a manner that if one died he could leave his 1/4 interest to his heirs. How did they take title to the real estate?

Select one of the following:

  • joint tenants with the right of survivorship

  • tenancy by the entirety

  • tenants in common

  • year-to-year tenancy

Explanation

Question 24 of 76

1

A seller agreed to list an older house for sale on an "as is" basis. He told the licensee that the roof leaked occasionally and that the plumbing and electrical systems were old and outdated. After signing the listing agreement, the seller had the house inspected for termites and rot damage. Both termite and rot damage were present,and the seller notified the licensee. If neither the seller nor the licensee told the buyer about the damage and the buyer personally inspected the property before closing, would the buyer be able to sue at a later date when the termite damage is found?

Select one of the following:

  • No, because the seller sold the property on an "as is" bases

  • No, because the buyer was free to inspect the property and ask any questions prior to the sale

  • Yes because the damages were from more than one cause

  • Yes. because the licensee did not alert the buyer once he discovered the damage

Explanation

Question 25 of 76

1

A buyer has a properly executed option with a seller to buy property, which runs through Sept. 15. The buyer decides not to exercise the option. What should the seller do to terminate the option?

Select one of the following:

  • Nothing, as the option expires automatically

  • Have an attorney file a declaration of novation

  • Exercise the statute of frauds

  • Execute the contingency clause in the option

Explanation

Question 26 of 76

1

The closing date is approaching on the sale of a property to a buyer who is represented by a licensee. Although the sellers have both signed the sales contract, the licensee learns that a relative of the sellers may have a title claim on this property. In this situation, the licensee should

Select one of the following:

  • ignore the existence of the relative because if title claim is not asserted before the closing, the buyer can experience no future title problems

  • ask the listing licensee to advise the seller to contact an attorney to seek a quitclaim deed from the relative

  • advise the buyer to contact an attorney in preparation to sue for specific performance

  • inform both the buyers and sellers that the closing cannot occir

Explanation

Question 27 of 76

1

The primary purpose of the real estate settlement procedures act (RESPA) is to

Select one of the following:

  • inform the buyers and sellers of all settlement costs in real estate transation

  • control the number of nonfederally-related mortgage loans in the country

  • standardize the amount of settlement costs in real estate closings

  • standardize settlement procedures in all parts of the country

Explanation

Question 28 of 76

1

Under which of the following circumstances may a seller keep the earnest money deposit of a defaulted buyer?

Select one of the following:

  • if the seller wants to declare the sales contract forfeited, and there is a forfeiture clause in the contract

  • if the seller wants to put the buyer on notice that the contract is being rescinded

  • if the seller suspects that the buyer never intended to execute the contract

  • under no circumstances

Explanation

Question 29 of 76

1

A deed restriction in a subdivision created a community playground that used a few square feet from the rear of every owner's lot. An owner has begun making plans to convert the rear half of his lot to a garden. The plans would require the removal of park equipment. A neighbor objects to these plans. The neighbor should

Select one of the following:

  • do nothing since an individual landowner has no authority to enforce deed restrictions

  • apply for a court injunction against the owner's plans

  • inform the owner that the playground is community property

  • file a lis pendens as soon as possible

Explanation

Question 30 of 76

1

An appraisal prepared using the amount of rent generated by the property is an example of which of the following approaches to value?

Select one of the following:

  • cost

  • market data

  • square footage

  • income

Explanation

Question 31 of 76

1

Which of the following best describes steering?

Select one of the following:

  • A licensee sells a property to a family with six children in a predominately older neighborhood.

  • A lending institution refuses to lend mortgage money within a certain areas due to the ethnic make-up of the area

  • Because of a prospect's national origin, an individual selling her own property advises the prospect that the property is sold when it's not

  • A licensee shows prospects of a particular race properties only in areas populated by families of the same race

Explanation

Question 32 of 76

1

When using the sales comparison approach, a licensee determines that a comparable property's tile floor in the entry way is worth $2,000. The subject property does not have tile floors at all. Which of the following adjustments should be made?

Select one of the following:

  • The comparable should be adjusted upward

  • The comparable should be adjusted downward

  • The subject property should be adjusted upward

  • The subject property should be adjusted downward

Explanation

Question 33 of 76

1

An owner has accepted an offer. Another buyer approaches the licensee with an offer on the same property. The licensee should tell this second offeror that

Select one of the following:

  • there is a contact on the property and this offer cannot be presented

  • this offer will be presented and he will encourage the owner to cancel his existing contract

  • he will present this offer for consideration since the title has not yet been transferred

  • this offer can be presented as a back up offer only

Explanation

Question 34 of 76

1

A real estate licensee was hired by a property management company to lease and manage commercial properties. Each commercial lease was different based on the negotiations of the parties. Which of the following should the licensee do in this circumstance

Select one of the following:

  • seek legal counsel to write and review leases

  • prepare the leases as he trained in real estate

  • fill in the blanks on reprinted residential lease forms

  • renegotiate the lease agreements so they are the same

Explanation

Question 35 of 76

1

On Feb 1, a licensee with ABC Reality takes a 3-month exclusive right-to-sell listing on a house. On March 1, the licensee moves out of state and inactivates his license. What happens to this listing?

Select one of the following:

  • It is automatically terminated

  • It becomes an open listing contract

  • It is voidable by the owner because the licensee is no longer active

  • It remains a valid exclusive right-to-sell listing contract with ABC Realty

Explanation

Question 36 of 76

1

A person bought a property from a seller and received a general warranty deed. Two years later, the seller's brother cam forth and claimed he had an ownership interest in the real property. The brother stated he knew the court would uphold his interest. In a general warranty deed, the buyer is protected from a situation by the covenant

Select one of the following:

  • of further assurance

  • of seisen

  • against encumbrances

  • of special warranty

Explanation

Question 37 of 76

1

What do special, general and universal types of agency have in common?

Select one of the following:

  • the originate with the principal

  • they create ongoing work for the agent

  • they empower the agent to sign all contracts for the principal

  • they terminate upon the acceptance of an offer to purchase

Explanation

Question 38 of 76

1

Which of the following could be deducted as expenses from annual income taxes on an investment property?

Select one of the following:

  • marketing additional principal payments

  • replacing a roof

  • installing a new furnace

  • painting a structure

Explanation

Question 39 of 76

1

A buyer has been pre-approved for a loan up to $300,000. The buyer plans to make a down payment of 20% on a property. The buyer will most likely apply for which of the following types of mortgage loans?

Select one of the following:

  • open end

  • home equity

  • wraparound

  • conventional

Explanation

Question 40 of 76

1

A listing licensee has which of the following obligations to the buyer?

Select one of the following:

  • accounting

  • negotiation

  • honesty

  • loyalty

Explanation

Question 41 of 76

1

A builder is obtaining a construction loan of $95,000 for a single-family residence. Under the Truth-in-Lending Act, disclosure of prepayment penalty by the lender is

Select one of the following:

  • not required when the amount of the loan is less than $100,000

  • not required for a business loan

  • required for new construction under $100,000

  • required for a single-family dwelling

Explanation

Question 42 of 76

1

Which of the following is a unilateral contract?

Select one of the following:

  • an option

  • lease

  • purchase agreement

  • an exclusive right-to-sell listing

Explanation

Question 43 of 76

1

Which of the following is a purpose of a staked survey?

Select one of the following:

  • estimating the value of a property

  • determining assessed value

  • locating property boundaries

  • evaluating marketability of title

Explanation

Question 44 of 76

1

A licensee was taking an upper bracket listing from a seller. The seller told her that they had lived in the neighborhood a long time, had many friends there, and wanted to be selective about who bought their house. The licensee was to tell them the race and nationality of anyone making an offer. How should the licensee respond to this requirement?

Select one of the following:

  • she should refuse to do so by explaining she would not always know the people making the offer

  • she should refuse to do so and explain that the seller's instructions could be a violation of federal law.

  • she could take the listing as it is legal as long as no discriminatory advertising is used

  • she should agree to it because, as the agent of the seller, the licensee has the duty of obedience to the seller's instructions

Explanation

Question 45 of 76

1

A licensee is typically authorized to do which of the following on behalf of this principal?

Select one of the following:

  • Submit all written offers to purchase

  • Place a client's money in the licensee's personal savings account to draw interest

  • Bind the principal to the contract

  • Withhold known information from a buyer concerning hidden defects in the listed property

Explanation

Question 46 of 76

1

A metes and bounds description must contain which of the following?

Select one of the following:

  • at least one artificial monument

  • a baseline from which measurements are taken

  • a lot and block number assigned to it in the county recorder's office

  • a point from which the description begins and at which it ends

Explanation

Question 47 of 76

1

A prospective buyer says he only has $1,000 from earnest money, but he anticipates receiving $4,000 as a gift from his aunt. The licensee accepts the $1,000 and a promissory note for the remaining $4,000 as a deposit. Must the promissory note be tied to the buyer's mortgage?

Select one of the following:

  • Yes, the note is negotiable and becomes part of the mortgage

  • Yes, the note is part of the financing instrument required by the lender

  • No, the note is only a personal document this is unsecured and not part of the mortgage

  • No, the note is a personal promise to repay a debt and is a complete contract alone

Explanation

Question 48 of 76

1

A buyer wants a high initial equity investment in a house. Which of the following should the buyer seek as part of the mortgage terms on the house?

Select one of the following:

  • shortest mortgage term available

  • longest mortgage term available

  • smallest down payment

  • largest down payment

Explanation

Question 49 of 76

1

In the appraisal process, the relationship between basic and non-basic employment patterns as a means of predictions population and income is known as

Select one of the following:

  • economic-base analysis

  • economic life

  • market analysis

  • income approach

Explanation

Question 50 of 76

1

Replacing the furnace filters at a rental property on a regular basis is what type of maintenance?

Select one of the following:

  • corrective

  • constructive

  • deferred

  • preventive

Explanation

Question 51 of 76

1

During the property inspection, there are indications that a methamphetamine laboratory had been in the house. This may constitute

Select one of the following:

  • an environmental hazard

  • a latent defect

  • curable obsolescence

  • physical deterioration

Explanation

Question 52 of 76

1

A minor leases an apartment. Immediately upon reaching the age of majority, the lessee notified the lessor that the lease was being terminated. Which of the following is true in this situation?

Select one of the following:

  • The lease is fully enforceable regardless of the lessee's age

  • the termination is possible because the rescission was made within a reasonable amount of time after the lessee reached the age of majority

  • the termination is not possible because all lessees are subject to the principal of caveat emptor

  • the termination is not possible because the lessee cannot unilaterally terminate a signed lease

Explanation

Question 53 of 76

1

A seller wants to allow a buyer to assume the existing mortgage. The sellers want to be sure that they will not be liable for the mortgage after it is assumed. Which of the following will best meet the seller's needs?

Select one of the following:

  • release

  • escalation

  • novation

  • due-on-sale

Explanation

Question 54 of 76

1

Which of the following types of information should a licensee disclose to a seller at the time of listing?

Select one of the following:

  • current market conditions

  • names of potential buyers

  • asbestos in a neighbor's home

  • racial composition of the neighborhood

Explanation

Question 55 of 76

1

To allow for most intensive use of a subdivision land, a zoning variation is required to permit with of the following?

Select one of the following:

  • a decrease in the number of outbuilding allowed per block

  • an increase in the number of building sites per acre

  • deed restrictions prohibiting the sale of any residential lot to a family of fewer than 4 persons

  • deed restrictions prohibiting the shrinkage of the backyard area in any residential lot

Explanation

Question 56 of 76

1

A licensee was completing a listing with a seller as the seller's agent. When they were walking through the property together, the licensee noticed that new paneling had been installed in the basement. When asked, the seller told the licensee that there had been a leak in the basement wall, but the crack had been patched and the paneling installed. Therefore, the seller said it need not be discussed with a buyer. In this case, which of the following is most appropriate?

Select one of the following:

  • As an agent of the seller, the licensee should follow the seller's instructions and not disclose any defects

  • Tell the buyer the basement had a leak but had been successfully repaired and was no longer a problem

  • Tell the buyer the basement had leaked and there had been some repair work done, but the buyer is entitled to an inspection of the basement

  • Since the licensee works for the seller, he cannot discuss with the buyer potential problems in the property

Explanation

Question 57 of 76

1

To qualify as a tax-deferred exchange, a property must be

Select one of the following:

  • a principal residence

  • held for productive trade in business

  • financed through a federal institution

  • amortized over a 30-year period

Explanation

Question 58 of 76

1

A buyer wants to buy a larger house and open a beauty salon in her home. She tells the listing licensee her plans and looks at the property with that licensee. They find a property she likes and she makes an offer this is accepted. After the closing and moving into the property, she finds out there are deed restrictions in the subdivision that prohibit a business operating out of one's home. Which of the following is true?

Select one of the following:

  • the buyer was solely responsible for researching the deed restrictions before buying the property

  • the licensee was representing the seller and had no duty to the buyer to investigate the restrictions

  • since the licensee knew of the buyer's intended use, the licensee should have ascertained whether or not the property could be used for that purpose

  • the seller was solely liable for not telling the buyer she would be unable to open a beauty shop in the property

Explanation

Question 59 of 76

1

A listing licensee has an exclusive right to represent a new subdivision. She shows properties in the subdivision to prospective buyers who are not working with other licensees. She prepares the offers for those who decide to buy. Which of the following statements best describes this situation?

Select one of the following:

  • the buyers are represented by the listing licensee

  • the buyers are not represented by a licensee

  • the licensee owes these buyers the duty of obedience

  • the licensee owes half of her commission to the developer

Explanation

Question 60 of 76

1

A licensee was showing a buyer an older home built in 1976. The buyer was concerned about the possibility of lead-based paint having been used on the house. The licensee should tell the buyer

Select one of the following:

  • that there is no law regulating this, but the buyer could require an inspection

  • that the residential lead-based paint reduction act requires disclosure by the seller on houses built before 1978, and they buyer could require an inspection

  • a lead-based paint disclosure is required on all houses built after 1978, but the buyer is entitled to an inspection if he chooses to have one

  • that lead based paint is no longer problematic as long as it has been painted over

Explanation

Question 61 of 76

1

A person wants to lease a small building to use a coffee shop. The tenant and the landlord agree upon a lease where the tenant will pay all utilities and taxes, in addition to rent. The landlord will pay the insurance. This type of lease is best known as a net lease

Select one of the following:

  • gross lease

  • net lease

  • gross rent multiplier

  • flat lease

Explanation

Question 62 of 76

1

The real estate market in a property owner's area is deflated. During a listing period of 6 months, the owner lowered the price of her property a total of $20,000 before finally selling. Upset at taking such a loss on the property, the owner tells the licencee that she is going to lower the percent of commission on the property. Does the owner have legal basis for this action?

Select one of the following:

  • Yes, the loss that the owner took on the property should rightfully be shared by the licensee through a lower commission rate

  • Yes, since commission rates are negotiated, they can be changed at any time by licensee or seller

  • No, once a commission rate has been negotiated and agreed upon in the listing contract, it cannot be changed unless both parties agree

  • No, commission rates are set by the state real estate commission and cannot be changed

Explanation

Question 63 of 76

1

An owner operated a gas station for 15 years. The city has decided to rezone the area from commercial to residential use. Which of the following is true regarding this situation?

Select one of the following:

  • The owner can continue to operate the station only if he obtains a variance

  • The owner has a non-conforming use and can continue to operate

  • The owner will have to stop using the property as a gas station because of the rezoning of the area

  • The owner will need to sell the property and limit it to residential buyers only

Explanation

Question 64 of 76

1

A buyer's licensee described the boundaries of a property to a client without disclosing that the boundaries describes were not exact. After purchasing the property, the new owner extended a fence within the described boundaries. A neighbor then brought an injunction against the new owner because the fence extended beyond the actual property boundaries. Can the licensee be accountable for misrepresentation?

Select one of the following:

  • Yes because the licensee must present a lot and block survey before closing

  • Yes because the licensee knew the boundaries cited could be false

  • No because the licensee's description was oral

  • No because the prospective buyer is responsible for obtaining a survey before closing

Explanation

Question 65 of 76

1

A farmer continuously plowed and planted an unused field that neighbored his property for a statutory period of time set be state law. He did not have the owner's permission to do this. After the statutory time period, the farmer put in a claim of ownership. He may become the owner of the land through

Select one of the following:

  • eminent domain

  • a prescriptive easement

  • a quitclaim deed

  • adverse possession

Explanation

Question 66 of 76

1

A church owns a retirement home and restricts the rental of the units to church members regardless of age, sex, race, color or national origin. Is this policy a violation of federal fair housing laws?

Select one of the following:

  • Yes because all discrimination on the basis of religion is illegal

  • Yes because the only owners of the single-family homes may discriminate on the basis of religion

  • No because the nonprofit organizations are not subject to federal housing provisions

  • No because religious organizations may limit the occupancy of dwelling units they own to persons of the same religion

Explanation

Question 67 of 76

1

The best way to determine whether or not there is an encroachment of a boundary line is to

Select one of the following:

  • have a survey done

  • require an appraisal of the property

  • examine a plat map

  • have a title search done

Explanation

Question 68 of 76

1

Real property taxes are on

Select one of the following:

  • cars, boats and trailers

  • a house and the land on which it sits

  • underdeveloped land only

  • all home furnishings and outbuildings

Explanation

Question 69 of 76

1

Which of the following is the most important element for a property manager to consider when selecting rental rates?

Select one of the following:

  • the rates for similar units in the area

  • the types of tenants desired for the property

  • the number of units available to rent

  • the square footage of each of the units

Explanation

Question 70 of 76

1

A licensee who finds a buyer a house listed with his own firm and is paid a fee by the buyer for finding a suitable house has what type of agency?

Select one of the following:

  • universal

  • general

  • implied

  • dual

Explanation

Question 71 of 76

1

A licensee has a property under contract with a financing contingency. The mortgage lender calls the licensee and asks if the contract price on the property can be decreased by 5000. The mortgage lender explains that this will help the buyer qualify for a loan and help the seller close. Which of the following should the licensee do?

Select one of the following:

  • prepare an addendum to the contract to indicate the price change

  • notify the sellers that the buyer is not financially qualified

  • contact a new mortgage lender for the buyer

  • refuse to change the price as this is illegal

Explanation

Question 72 of 76

1

A pest inspection is ordered and an infestation is found. Who pays to correct the problem?

Select one of the following:

  • the buyer

  • the broker

  • the seller and buyer split the cost

  • the party specified in the contract

Explanation

Question 73 of 76

1

A buyer bought a home from an owner. The owners agreed to owner-finance the property. The parties agreed to amortize the loan over a 15 year period. The buyer become the owner of the record of the property, and the seller had a lien against the property. What type of instrument was used to purchase the property?

Select one of the following:

  • a loan assumption

  • a land contract

  • a purchase money mortgage

  • a reverse annuity

Explanation

Question 74 of 76

1

A buyer signs a contract to purchase a house, but then attempts to have the contract voided. He is able to prove that he was legally mentally ill when he signed the contract. Will the buyer likely have the contract declared void?

Select one of the following:

  • Yes because his mental illness renders the contract voidable

  • Yes because any buyer can void a purchase agreement before closing

  • No because mental illness is unrelated to the enforceability of contracts

  • No because the contract was written and signed by both parties

Explanation

Question 75 of 76

1

The Real Estate Settlement Procedure Act (RESPA) applies to which of the following loans?

Select one of the following:

  • a 30-acre farm

  • a contract for a deed

  • an installment contract

  • a first mortgage home loan

Explanation

Question 76 of 76

1

A buyer bought a house in a subdivision zoned residential. The buyer wanted to open a day care in the home. To do so legally, the buyer should obtain a

Select one of the following:

  • conditional use permit

  • nonconforming use permit

  • bulk zoning permit

  • permit for a buffer zone

Explanation

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