RE exam Flashcards
A buyer paid a $10,000 earnest money deposit at the time of contract for a property that is selling for $197,000. The lender has agreed to a loan for 90% of the purchase price at 4.5% interest for 30 years. The buyers closing costs will be $6,540. What is the additional cash the buyer must bring to closing? (Unit 12) A. $6,540 B. $16,240 C. $19,700 D. $26,240
$16,240 Additional Cash Due at Closing
A developer purchased two 150-front foot lots for $45,000 net each and divided them into three 100-front foot lots. The developer sold the lots for $450 per front foot. Calculate the developer’s percentage profit. (Unit 14) A. 30% B. 50% C. 70% D. 75%
50% Profit
A homestead property is located in Tampa, Florida, in Hillsborough County. The city tax rate is 7.0 mills, the county tax rate is 8.3 mills, and the school district tax rate is 4 mills. The homeowner is a blind widow and has qualified for homestead exemption. What must the homeowner pay in property taxes, if the home has been assessed at $250,000? (Unit 18) A. $3,667.00 B. $3,767.00 C. $3,818.50 D. $4,825.00
$3,767 Total Taxes
A lease calls for annual minimum rent of $12,000 plus 4 percent of annual gross sales in excess of $250,000. What is the annual rent for the year if the annual gross sales are $350,000? (Unit 9) A. $16,000 B. $16,500 C. $50,000 D. $52,500
$16,000 Total Rent
A person works for an owner-developer and is paid on a salary basis. Along with that, they also earn a bonus for each lot sold in the development. Are they required to hold an active real estate license?
Yes, anyone who makes a commission from sales must hold an active real estate license.
A prospective buyer of an existing condominium (resale) unit must receive what document(s)?
- Most recent year-end financial report 2. Rules of the association 3. Governance form
A sales associate receives an earnest money deposit check on Thursday. When must the associate deliver the deposit to their broker?
Friday. (By the end of the next business day)
An FHA loan borrower has monthly housing expenses of $1,800, total monthly obligations of $2,550 and gross monthly income of $5,000 What is the total obligations ratio for this borrower? (Unit 13) A. .15 B. .36 C. .51 D. .87
.51 Total Obligations Ratio
An industrial property is valued at $530,000. The land value is 20% of total value. Calculate the annual IRS depreciation deduction (round to the nearest dollar). (Unit 18) A. $10,872 B. $13,590 C. $15,418 D. $19,273
$10,871.79 -> Rounded to $10,872
An owner of an apartment complex offers a $150 bonus to tenants who refer people that become tenants. Is this legal under Chapter 475?
No, the maximum referral fee allowed is $50 for unlicensed tenants.
Can the Florida Real Estate Commission (FREC) impose restitution to an injured party?
No, they can impose a probationary period, suspension, or require completion of a course.
Closing is scheduled for March 8. The buyer is assuming the seller’s mortgage loan that has a principal balance of $235,000 at 5 ½% interest. The day of closing is charged to the buyer. What is the proration and how is it entered on the closing disclosure? (Unit 14) A. $247.88 credit buyer only B. $247.88 debit to seller, $247.88 credit to buyer C. $247.88 credit to seller, $247.88 debit to buyer D. $849.86 debit to seller, $247.88 credit to buyer
$247.88 debit to seller, $247.88 credit to buyer
For brokers, what anti-competitive acts are prohibited under the Sherman Antitrust Act?
- Price-fixing (competing brokers establish standard commission rate) 2. Market allocation (brokers agree to split markets among themselves)
For residential income-producing property, what is the established useful asset life under the IRS code?
27.5 years.
How long does a lender have to provide a borrower with a written Loan Estimate under the TILA-RESPA Integrated Disclosure Rule?
It must be provided no later than 3 business days after receiving the borrower’s loan application.
How many business days does a broker have to notify FREC if a broker requested an escrow disbursement order (EDO), but the buyer and seller ended up settling their dispute?
10 business days.
How many sections are in a township, and which section is directly west of section 15 in a given township?
36 sections total, section 16.
How must compensation be paid (if any)to a sales associate who performs a broker’s price opinion (BPO)?
Any compensation must be paid to the broker, never directly to the sales associate.
How will any prorated rental income that is paid in advance appear on the Closing Disclosure?
Credit to the buyer, debit to the seller.
How would unpaid property taxes appear on the Closing Disclosure if the closing is set for July 15th?
Debit to the seller, credit to the buyer.
How would you convert a tax rate expressed in mills to a decimal?
Move the decimal point three places to the left (1,000th place). EX: 9 mills = .009
If a comparable property is better than the subject property, how would you calculate the adjusted sale price of the comparable?
CBS: Comparable Better Subtract *If the comparable property was inferior, CIA: Comparable Inferior Add
If a developer wants to sell or lease lots in a subdivision with 100 or more lots, which agency must the subdivision be registered with?
The Consumer Financial Protection Bureau.
If a landlord would like to keep a security deposit in an interest-bearing account, what is required?
1) A separate Florida bank account, 2) 5% of the simple interest paid to the tenant per year 3) OR at least 75% of annualized average interest rate that is payable on the account.
If a sales associate is working under a broker, what type of agent would the associate be?
A general agent
If a licensee receives a citation and the allegations in the citation are NOT disputed, the penalty will go into effect and the case will be closed. This process has the same effect as what FREC determination?
A final order.
If a sales associate wants to advertise as an agent, what must they include in the advertisement?
The brokerage firm that they work for.
If an individual has attained a four-year degree or higher in real estate from an institution of higher education, what education requirement(s) would they be exempt from?
Post-licensing requirements.
If assets are being exchanged in either a business brokerage or a real estate brokerage, what is required?
An active real estate license.
If one of the co-owners in a joint tenancy sells their interest in a property, what type of tenant would the person receiving the interest be?
A tenant in common. (Interest goes to heirs according to will) *A joint tenancy features right of survivorship (Interest goes to remaining co-owners)
In a title theory state, who holds the title to real property?
The mortgagee (lender)
In certain nonresidential transactions where the buyer and seller both have assets of $1 million or more, and two associates can act as single agents in the same transaction, what disclosure form MUST be signed by the buyer and the seller?
The designated sales associate notice.
In Florida, can a broker associate hold more than one license?
No, sales associates and broker associates may only be registered under one employer in Florida, but they can hold licenses in other states.
Is a seller required to have a property tested for lead- based paint if it was built prior to 1978 and the test is requested by the buyer?
