Exam

Question 1

A suit in court to force a party to a contract to complete the requirements of the contract is called a suit for

Answer 1

Specific performance

Question 2

The best way to avoid legal problems when preparing sales contracts is by

Answer 2

Putting all terms in writing

Question 3

True / false _ homosexuals are Not a protected class under federal fair housing law?

Answer 3

True

Question 4

When a mortgage is used in a real estate transaction, the evidence of the principal obligation is the

Answer 4

Note

Question 5

In the government rectangular survey system, section his located due:

Answer 5

East of section 11

Question 6

A mortgage broker -

Answer 6

Acts as an intermediary

Question 7

An owners’ policy of title insurance continues to be in force

Answer 7

As long as the insured has liability

Question 8

At an open house, an interested buyer asks the listing agent a number of questions. Can the agent tell the interested buyer why the sellers are moving?

Answer 8

No

Question 9

True/false -radon is a liquid released the in soil?

Answer 9

False

Question 10

Ceilings sprayed with a fluffy, stringy material may indicate the presence of:

Answer 10

Asbestos

Question 11

The absence of what would invalidate a deed?

Answer 11

Delivery

Question 12

Which type of interest is usually charged when financing a house?

Answer 12

Simple interest

Question 13

When presenting an offer to a seller and the seller has legal questions about the contract, the real estate professional should?

Answer 13

Advise the seller to consult a lawyer

Question 14

A seller engages a real estate broker to find a buyer ready, willing, and able to purchase the seller’s parcel of real property. The seller executes and delivers to the broker an exclusive right-to-sell employment contract. A few weeks prior to the expiration date of the employment contract, the seller decides to revoke the contract before any sale occurs and prior to the broker finding a buyer ready, willing, and able to buy the property. The owner:

Answer 14

Can revoke this contract but could be liable for damages

Question 15

Is recordation an essential element for a lawfully enforceable contract?

Answer 15

No

Question 16

The substitution of a new contract, which terminates and replaces an existing contract, is called:

Answer 16

Novation

Question 17

A money judgment of the court, when recorded, always becomes an

Answer 17

Involuntary lien

Question 18

What has priority claim over a previously recorded trust deed?

Answer 18

Unpaid property taxes

Question 19

The taxes are $858.92 for January through December 31. The taxes are paid in arrears. The closing is July 16, and the buyer owns the date of closing. What is the debit and credit?

Answer 19

$461.23
$858.92 ÷ 365 = $2.353205
Seller has owned 196 days x $2.353205 = $461.23
Debit the seller and credit the buyer $461.23

Question 20

The period over which a property may be profitably utilized is known as?

Answer 20

Economic life

Question 21

Who holds the title to real property when a mortgage is given?

Answer 21

Mortgagor

Question 22

If a seller accepted an offer but changed the date of possession and initialed that change - what would happen?

Answer 22

It would become a counteroffer, subject to acceptance by the buyer

Question 23

A buyer asked a listing broker when a property line was. Not knowing exactly, the broker estimated the location of the line. After closing, the buyer discovered that the actual location the of line was 3 feet inside where the broker estimated. Is the listing broker liable to the buyer?

Answer 23

Yes, brokers should only make statements they are sure are true.

Question 24

An escrow company acts as an

Answer 24

Agent for both the buyer and seller

Question 25

The deed covenant that obligates the grantor to perform any acts necessary to protect the title conveyed is called the covenant of

Answer 25

Further Assistance

Question 26

Certain economic principles are of considerable importance in the valuation of real estate. The principle that no "buyer will pay more for a product than the price be can pay for a reasonable duplicate"is known as the principle of:

Answer 26

Substitution

Question 27

A property on a lake is closing on August 1st. A boat dockage feel due to the homeowners association, for $240 for a six-month period, from July 1 to December 31 is due September 1I and will be paid by the buyer. What entry appears on the closing statement?

Answer 27

Credit to buyer $40 | $240 ÷ 6=$40 per month X 1 month (July 1-July 31) = $40 credit to buyer

Question 28

Taxation is:

Answer 28

One of the governments rights

Question 29

A title plant is a:

Answer 29

Collection of real estate records

Question 30

A house has an assessed value of $142,000. The property is taxed at 80% of the assessed value at a rate of $2.12 per $100. If the assessed valuation increased by 18%, what is the amount of taxes to be paid on the property?

Answer 30

$2,841.82 $142.000 x 1.18 = $167,560 increased valuation $167,560 x 0.80 = $134,048 New tax basis assessed value X tax rate = annual taxes 2.12 ÷100 =0.0212 $134,048 x 0.0212 = $2,841.82 annual taxes

Question 31

Is providing for control of rents a type of zoning control?

Answer 31

No

Question 32

The property manager working for the landlord must notify the potential tenant of:

Answer 32

Environmental contamination

Question 33

Two appraisers were asked to appraise an apartment property. Both arrived at the same net income, but the first appraiser used a capitalization rate of 6%, while the second appraiser used a capitalization rate of 8%. In this case, the property with the higher cap rate will have a?

Answer 33

Lower value -The more an investor wants in return on a property, the less he or she can pay to buy it. Therefore, the higher the cap rate, the lower the value

Question 34

The requirement that a contract not be for an illegal purpose or against public policy is referred to as:

Answer 34

Legality of object

Question 35

The broker working for the buyer must tell the seller-

Answer 35

If the buyer cannot qualify for a loan.

Question 36

In law, a trade fixture is:

Answer 36

Personal property

Question 37

The Do Not Call rules apply to telephone solicitations made:

Answer 37

Both in-state and state-to-state

Question 38

The right of the government to impose taxes on land is called the right of?

Answer 38

Taxation

Question 39

If a seller netted $315,180 after paying closing expenses of $6,260, an existing mortgage balance of $430,000 and a 7% commission, how much was the sales price?

Answer 39

``` $808,000 Looking for Whole (Sale price) $315,180 + $430,000 + $6,260 (P) 100% - 7% (R) Sale price $_ (W) W= ($315,180+$430,000+ $6,260) ÷ (100%-7%) W= $751,440÷93% W= $751,440÷ 0.93 W= $808,000 ```

Question 40

When the parties to a contract have fully performed the terms, the contract may properly be described as:

Answer 40

Executed

Question 41

The principal broker at XYZ Realty has told hers salespeople to try to only sign listing contracts that give the firm the most protection. In this case, the salespeople should be trying to get what type of listings?

Answer 41

Exclusive right-to-sell listings

Question 42

In researching records at the county clerk's office, a first mortgage and a second mortgage on the same piece of property can usually be distinguished by:

Answer 42

Date of recording

Question 43

The mortgage insurance premium on an FHA loan is paid by the:

Answer 43

Mortgagor