Real Estate Flashcards
(25 cards)
A lease for a three-year term that called for rent to be paid quarterly expired. If at the end of the term, the landlord were to accept another payment of rent, the lease would be
A) extended another three years
B) a periodic Tenancy
C) extended for a term not to exceed one year.
D) cancelled in any event
B (The original three-yea contract is no longer in effect, and when the broker accepts additional rent, it creates a periodic tenancy)
Marx gets to one of his barns by driving across McDonald’s land. He has been making the drive daily for the past six years. McDonald has often asked Marx to stop this practice. Marx now says he has legal right to continue this use of McDonald’s land. Marx’s right, if valid, is an easement by
A) necessity
B) implied grant
C) prescription
D) defeasement
C (A Prescriptive easement is acquired through adverse use of another’s property for a five year, continuous period. From the facts given in the statement it would appear that this is an easement by prescription).
The general term value means
A) the function of an object
B) the average use and function of an object to all people
C) the worth, usefulness, or utility of an object to someone for some purpose
D) a good buy
C (Value is subjective depending on the individual’s needs. There are four elements to value: demand, utility, scarcity and transferability. Value increases when there is high demand for the same product, creating utility for that product. Value further increases when the product is scarce, creating more demand than supply. Finally value increases when the product is highly transferable from one party to another. The worth, usefulness and utility of the product is subjective, however driven by the four elements of value
A prospetive purchaser obtained a four-month option on a parcel of real proptery by paying $200 to the owner. All of the following are true except
A) the optionee has created a legal interest in the property
B) the optionor is totally restricted by having recieved a “valueable” consideration
C)the agreement imposes no obligation on the optionee to purchase the property
D) a unilateral contract has been created
A (An option is not an interesting property; it is a unilateral contract in which the optionor is bound, but the optionee is not
Race restrictions limiting the sale or lease of property to persons of the Caucasian race were imposed on a subdivision in 1920, due to expire in 2020. The restrictions are presently
A) valid, as long as the origional owner is still alive
B) unenforeable, even if the majority of homeowners want them
C) enforceable . if the buyer agrees
D) Binding
D (Origional cost has very little or nothing to do in any cost appraisal of an older structure)
All of the following would have an effect on the final estimate of value when making an appraisal of an old family residence except:
A) Purpose of the appraisal
B) Suitability of the residence to the site
C) Physical condition of the building
D) Origin al cost of the building
D (The Uniform Settlement Statement must be delivered to the borrower at, or before closing. Should the borrower waive this right, and not be present at closing, the statement should be delivered as soon as possible after the transaction closes
How long does a victim have to file a complaint about discrimination with the Department of Housing and Urban Development? A) three months B) six months C) nine months D) one year
D (The Department of Housing and Urban Development enforces fair housing laws on the federal level. Complaints must be filed within one year
The best synonym for “value” is
A) cost
B) worth
C) uselessness
D) asking Price
B (“Value” can be defined as “Present worth of future benefits”)
In real estate ‘Devise” refer to
A) a conveyance or real property by will
B) an inheritance
C)destruction of man-made structures by acts of god
D) probate action when one dies intestate
A (In popular usage, devise means death. In real estate, it means a transfer real property under a will)
Under federal income tax law, the basis of real property is the property’s
A) purchase price minus any existing assumed loans
B) assessed value prior to sale
C) fair market value
D) original cost plus cost of any improvements
D (Basis, cost, cost basis, and purchase price, plus adjustments for capital improvements and deductions for depreciation expense can all be defined as what was paid for the property
If you hold an undivided interest in the common areas, and a separate interest in a specific unit of an industrial, commercial, or residential building, you you would own a
A) stock cooperative
B) condominium unit
C) community apartment project
D) landlord
B (This is the definition of a condominium. The individual has a fee ownership of the unit and joint ownership of the land and common area. The key wording is “separate interest in the unit.” A community apartment project allows for use or occupation only of the unit.
A listing agreement is essentially a/an
A) employment contract
B) purchase contract
C) option to sell
D) all of the above
A ( A listing is an employment contract hiring the broker to do a job)
Which of the following is an “interest” but not an “estate” in real property?
A) Remainder
B) Mortgage
C) Reversion
D) Leasehold
B (A mortgage is merely an interest in property. An estate refers to an interest in the land whether as an owner or a lessee.
Which of the following is correct concerning delinquent taxes and redemption rights?
A) The important effect of a “sale to the state” by the tax collector is to start the redemption period running, but the delinquent owner’s possession remains undisturbed
B) The homeowner is required to make monthly installment payments to liquidate the delinquent property taxes and accrued penalties that are owed
C) In event the delinquent owner transfers or otherwise alienates the property, the redemption period is automatically terminated
D) The property is automatically deeded to the state if the property is not redeemed within one year
A (The important effect of a “Sale to the state” by the tax collector is that it starts the redemption period running; however, the delinquent owner’s possession remains undisturbed for five years)
The “mortgagor” is the one who
A) sells the property
B) signs the note
C) holds the trust
D) accepts a mortgage
B (The mortgagor (buyer/borrower) would sign the note and mortgage in favor of the lender. The seller, owner or grantor sells the property, the trustee holds the title in trust, and the mortgagee (lender) takes the mortgage)
The majority of money used for loans on real estate comes from
A) individual savings
B) federal reserves
C) co-op savings
D) government bonds
A (The vast majority of money loaned out through banks and credit unions is the depositors’ money placed with their institution. Therefore, the source of the money is individual savings)
Which of the following is required for a valid escrow in the conveyance of title to real property A) B) C) D)
B (These are two legal requirements for a valid escrow in California)
A testament is a A) B) C) D)
A (A testament is another word for a will. A male person who makes a will is a testator)
Definitions of market value are least concerned with A) B) C) D)
A (The original cost of the materials has very little to do with value)
The key factor in a development A) B) C) D)
A (Population and high traffic count are helpful, but it is important that the residents in the area have good purchasing power)
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A (When a contract is voidable, one of the parties may reject it because there is a deficiency (defect) in the contract that injures him or her. The injured party may proceed with the contract, but also has the option to disaffirm it (have the court terminate the contract).
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B (Short blocks are expensive because more land is devoted to streets)
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D (It is also called “plottage.” In appraising it is an important factor influencing value)
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B (The sole purpose of a trust deed is to secure the note. it is used to place real property as security in the event of nonpayment on the note. The note is the incident of the debt. A trust deed in not held by the trustor (borrower), but rather, it is given the trustor and held by the beneficiary (lender)
