PSI Exam Prep: Practice of Real Estate

Question 1

Who can act like an escrow agent?

Answer 1

the broker,
a title company representative
or attorney

Question 2

Federal laws outline seven protected classes

Answer 2

Race, color, religion, sex, disability, familial status, and national origin.

Question 3

it prohibits housing discrimination based on race or color. There are no exemptions under this law. It is never legal to discriminate on the basis of race. This act protects the rights of U.S. citizens to buy, sell, convey, inherit, and possess property.

Answer 3

The Civil Rights Act of 1866

Question 4

This act prohibits housing discrimination based on race, color, national origin, and religion.

Answer 4

Title VIII of the Civil Rights Act of 1968 is the Fair Housing Act

Question 5

it added sex to the list of protected classes.

Answer 5

The Housing and Community Development Act of 1974

Question 6

it requires lenders to give consumers equal access to credit. The act prohibits discrimination based on race, color, religion, national origin, sex, marital status, or age with respect to granting credit and requires lenders to respond to all loan applications within 30 days, giving reasons for any application rejections.

Answer 6

The Equal Credit Opportunity Act (ECOA) of 1974

Question 7

it extended fair housing protection to cover familial status and disability and provides remedies to victims of housing discrimination. It requires that owners make reasonable accommodations to property rules, policies, and practices to provide persons with disabilities appropriate access.

Answer 7

The Fair Housing Amendments Act of 1988

FHAA

Question 8

it is an illegal, discriminatory practice by lenders or insurance companies that refuse or limit business within specific geographic areas based on the demographics of the area rather than on the creditworthiness of the specific borrower.

Answer 8

Redlining

Question 9

the practice of charging non-white borrowers higher fees or interest rates may be referred to

Answer 9

reverse redlining.

Question 10

it is the act of inducing property sales by threatening that the changing demographics or the entry of a minority resident will decrease values. Licensees who engage in this behavior for their own profit are guilty of violating fair housing laws.

Answer 10

Blockbusting

Question 11

it is the act of guiding prospective buyer/tenants to or away from a location based on their membership in a protected class. Licensees who engage in this practice are guilty of a fair housing violation.

Answer 11

Steering

Question 12

it prohibits protected class-based discrimination in the delivery of commercial and public programs, services, and activities.

Answer 12

Title II of the Americans with Disabilities Act of 1990

Question 13

What are some exceptions to Federally lawys?

Answer 13

Seniors of 55 and over, Mrs. Murphy exemption, Single-family housing sold or rented without a broker’s assistance, and religious organizations

Question 14

Statement that appears to a reasonable person as an exaggeration that wouldn’t be relied on. it is permissible but not suggested.

Answer 14

Puffery

Question 15

A statement, photo, or ad that a reasonable buyer would consider to be reliable and even when unintentional, can lead to a voidable contract.

Answer 15

Misrepresentation

Question 16

A statement made by a person who should have known it to be false; becomes fraud when it’s intentional.

Answer 16

Negligent misrepresentation

Question 17

Omission of a material fact is considered intentional misrepresentation.

Answer 17

Yes

Question 18

it protects consumers from unfair and deceptive advertising and it pays particular attention to ads that make health and safety claims.

Answer 18

The Federal Trade Commission (FTC)

Question 19

The FTC determines the severity of penalties based on the violation’s severity. Penalties range from

Answer 19

a cease-and-desist order (which becomes effective immediately) 
corrective advertising
 civil penalties
consumer and other monetary remedies
 and informational remedies.

Question 20

it is intended to protect consumers from unwanted telephone solicitations. The primary impact on licensees comes from the Do Not Call Registry (DNC). The act prohibits calls to consumers before 8 a.m. or after 9 p.m., anonymous and robo calls, and calls to cell phones.

Answer 20

The federal Telephone Consumer Protection Act (FTCPA), overseen by the Federal Communications Commission

Question 21

Licensees may call consumers with whom they have had an established business relationship for

Answer 21

18 months after the last interaction

Question 22

hose who violate the DNC may be subject to penalties in excess of

Answer 22

$40,000 per violation/separate call.

Question 23

what does caveat emptor states means?

Answer 23

non-full disclosure states

Let the buyer beware = caveat emptor

Question 24

its primary purpose is to prevent monopolies that would cause a restraint of trade.

Answer 24

The Sherman Act of 1890

Question 25

it prohibits mergers that would result in a monopoly.

Answer 25

The Clayton Act supports the Sherman Act

Question 26

it investigates antitrust violations and penalizes violators.

Answer 26

The Federal Trade Commission, created by the Federal Trade Commission Act

Question 27

it involves an agreement (or collusion) between competitors (brokers) to fix contract terms, services, or products at a specific price or level, such as suggesting there’s a “standard” fee for broker compensation.

Answer 27

Price fixing

Question 28

it involves an agreement between brokers to divide up the market and then refrain from competing for business.

Answer 28

Market allocation

Question 29

it include providing a service dependent on the customer/client obtaining (or not obtaining) another service from a specific provider.

Answer 29

Tie-in arrangements

Question 30

it is an agreement between two or more parties who conspire to not do business with a particular person or company.

Answer 30

Group boycotting

Question 31

it is one in which the competing firms agreed to violate antitrust laws. it means that authorities don’t need to make any additional inquiries about the violation to impose penalties. The fact that collusion existed is enough.

Answer 31

A per se antitrust violation

Question 32

Penalties for antitrust violations may be as much as

Answer 32

$1 million and 10 years in prison; for corporations, penalties may be as much as $100 million.

Question 33

Brokerage firms found guilty of violations may be subject to

Answer 33

court-ordered supervision for up to 10 years.

Question 34

it provided consumers with remedies if they became victims of discrimination in housing and also added familial status and disability to the list of protected classes.

Answer 34

Fair Housing Amendments Act of 1988

Question 35

is Filling in the contract blanks considered practicing outside your expertise?

Answer 35

No

Question 36

it included gender or a person’s sex in the list of protected classes.

Answer 36

Housing and Community Development Act of 1974

Question 37

What does the Federal Trade Commission consider to be an unfair ad?

Answer 37

Any ad that is likely to mislead consumers acting reasonably under the circumstances

Question 38

The Federal Trade Commission is concerned with all ad claims but is most likely to be most concerned with

Answer 38

Any ad that makes a health or safety claim or any claim that’s difficult for the consumer to evaluate

Question 39

Which of the following strategies would help to make a “Choose Your Neighbor” marketing letter non-discriminatory in its effect?

Answer 39

Listing the property on the MLS

Question 40

this act expressly prohibits collusive acts that result in an unreasonable restraint of trade or reduced competition.

Answer 40

The Sherman Antitrust Act of 1890

Question 41

Who is responsible for ensuring accessibility requirements for a commercial property are met?

Answer 41

Property owners and property managers

Question 42

The Controlling the Assault of Non-Solicited Pornography And Marketing Act of 2003,

Answer 42

CAN-SPAM

Question 43

Which act created an agency to investigate antitrust practices?

Answer 43

Federal Trade Commission Act

Question 44

What does the Federal Trade Commission consider to be an unfair ad?

Answer 44

Any ad or business practice that causes or is likely to cause injury is considered an unfair ad

Question 45

Which agency is charged with enforcing fair housing laws and holding all parties accountable for compliance with these laws and regulations?

Answer 45

Office of Fair Housing and Equal Opportunity

Question 46

When federal and/or state law interfere, which one should you use?

Answer 46

The more strict one

Question 47

What form are independent contractors require to fill out?

Answer 47

W-9

Question 48

What is true about existing building when ti comes to ADA regulations?

Answer 48

Existing buildings do not have strict regulations such as new construction

Question 49

The Office of Fair Housing and Equal Opportunity is a part of which federal department?

Answer 49

HUD