Real Estate Principles

Question 1

When did California become a territory of the United State?

Answer 1

California achieved full statehood on September 9, 1850.

Question 2

The law designates the rights that accompany ownership of real property as the bundle of rights. What are the bundle of rights?

Answer 2

1) The right to OWN property
2) The right to POSSESS property
3) The right to USE property
4) The right to ENJOY property
5) The right to ENCUMBER property or borrow money on the property
6) The right to DISPOSE of property
7) The right to EXCLUDE those who do not share ownership of the property

Question 3

The right of the owner of land bordering on a river to use the river water in a reasonable manner is called?

Answer 3

Riparian Rights

Question 4

What is the main feature of personal property?

Answer 4

It’s Mobility

Question 5

The right of the state to give permission to a nonriparian owner to take water from a river or lake is called?

Answer 5

Right of Appropriation

Question 6

Which group of explorers and colonizers set up presidios and pueblos in the early days of California?

Answer 6

Spanish

Question 7

Arnold and Sally are tenants in an apartment. They add temporary shelves in the kitchen. When they move, the shelves will probably be considered?

Answer 7

Personal Property

Because the shelves are temporary they can take them with them when they move, becoming personal property.

Question 8

The words ‘chattel’ and ‘chose’ stand for?

Answer 8

Personal Property

Question 9

Wall-to-wall carpeting in a single-family dwelling is usually considered to be?

Answer 9

A Fixture

Question 9

All other things being equal, in a dispute between a buyer and a seller over a fixture, the courts tend to favor?

Answer 9

The Buyer

Question 11

Personal property that is attached to the land in such a manner that it becomes part of the real property is called?

Answer 11

A Fixture

Question 12

Garcia leases a retail store and operates a jewelry business. When she moves, her business machines and shelves will probably be considered?

Answer 12

Trade Fixtures.

(Articles of personal property that a business tenant has attached to real property because of their need to be used in a trade or business.)

Used by the business, not sold to customers

Question 13

The water flowing down a river gradually builds up the land along the bank by leaving deposits of soil; what is this action called?

Answer 13

Accretion

Question 14

Growing vegetable crops are sometimes referred to as?

Answer 14

Emblements

Question 15

Which material is not considered capable of absolute or exclusive ownership until reduced to possession?

Answer 15

Oil.

Oil and gas are special classes of minerals and are governed by the rule of capture because of their shifting nature.

Question 16

Ms. Jones was killed in an automobile accident. When the courts were called upon to distribute her property, they found she had died interstate. This means what?

Answer 16

That she died without a will.

Question 17

If a married man with two children died without leaving a will, separate property that was purchased by him before he married and was maintained as separate property during the marriage would be distributed how?

Answer 17

One-third to the widow and two-thirds to the children.

Interstate Succession (No Will)
Separate Property distribution:

Spouse and one child (50/50)
Spouse and two or more children (1/3 & 2/3)
No spouse, no children (all goes to next of kin)

Question 18

The state urgently needs a piece of property to complete a project for public use. The owner did not wish to sell. What method would be used to acquire the property?

Answer 18

Eminent Domain

must be taken for a public use

Question 19

Tests of a Fixture:

Answer 19

• Method of attachment
• Adaptability
• Relationship
• Intention
• Agreement

MARIA

Question 20

An orange tree in a suburban backyard is real property. An orange on the ground that has fallen off the tree is?

Answer 20

Person property, because it’s movable.

Question 21

Hostile, open, and notorious use of another person’s land for five years is required for title by?

Answer 21

Adverse Possession

Question 22

An instrument by which the government grants title to a person is a(n)?

Answer 22

Patent

Question 23

A deeds to B, who does not record the deed or take physical possession of the property. A then deeds to C, who had no notice of the prior deed to B. C records the deed. In a dispute over title between B and C, what is a general rule to remember?

Answer 23

The first to record is the the first in right.

Question 24

An after acquired title provision occurs in what type of deed?

Answer 24

Grant Deed

Question 25

When does a Private Grant occur?

Answer 25

Private Grant occurs when an owner voluntarily conveys his or her ownership rights to another. The basic instrument used in this transaction is a deed.

Question 26

A _______ will is a formal typewritten document signed by the individual who is making it, wherein he or she declares in the presence of at least two witnesses that it is his or her will. The two witnesses, in turn, sign the will.

Answer 26

Witnessed

Question 27

Because of its peculiar shape, the state of California requires three principal base lines and meridians. What are they?

Answer 27

Humboldt Base Line and Meridian (Northwestern California. The actual point of beginning is on Mt. Pierce, south of Eureka, California.) Mt. Diablo Base Line and Meridian (Central and Northwestern California. The actual point of beginning is on Mt. Diablo, near Walnut Creek, California.) San Bernardino Base Line and Meridian (Southern California. The actual point of beginning is the intersection of Base Line Street and Meridian Avenue in San Bernardino, California.)

Question 28

How many acres in a township?

Answer 28

640 Acres

Question 29

One acre is how many square feet?

Answer 29

43,560 Square Feet

Question 30

A _______ will is a document written, dated, and signed in its entirety in the hand writing of the maker. It requires no witnesses.

Answer 30

Holographic

Question 31

The term 'escheat' is a legal term meaning?

Answer 31

Title has reverted to the state. (Escheat is the legal process whereby ownership of property reverts to the state due to lack of heirs or want of legal ownership.)

Question 32

A ________ will is a preprinted form approved by the state in which a person merely fills in the blanks, usually without formal legal assistance. This will requires at least two witnesses.

Answer 32

Statutory

Question 33

What is avulsion?

Answer 33

Avulsion occurs when a river or stream, during a storm or earthquake, carries away a part of the bank and bears it to the opposite bank or to another part of the same bank.

Question 34

How many feet are in one square acre?

Answer 34

208.71 Feet

Question 35

It is impossible for a corporation to legally hold title as a: A) Trustee B) Joint Tenant C) Tenant in Common D) California Corporation

Answer 35

B) Joint Tenant A corporation is not allowed to hold title as a joint tenant because, in theory, a corporation never dies.

Question 36

When does Foreclosure Action take place?

Answer 36

Foreclosure Action takes place when a person holding a delinquent lien on a property institutes proceedings requesting the forced sale of property.

Question 37

Which of the following is considered to be a less-than-freehold estate? A) Fee simple absolute B) Life estate C) Leasehold estate D) Fee simple defeasible

Answer 37

C) Leasehold Estate Less-than-freehold estates are interests held by tenants who rent or lease property. Tenants are also called lessees or leaseholders.

Question 38

When does a Public Grant occur?

Answer 38

A Public Grant occurs when a governmental agency deeds property to an individual or institution.

Question 39

How many feet are in a mile?

Answer 39

5,280 Feet

Question 39

The single most important characteristic of joint tenancy is what?

Answer 39

Right of Survivorship (The most important characteristic of joint tenancy is the right of survivorship. This means that if one tenant dies, the surviving joint tenant(s) acquire the deceased interest without a court action such as probate.

Question 41

A deeds a life estate to B; upon B's death, title is to pass to C. What is this an example of?

Answer 41

Remainder Estate. Example: if the person granting the life estate (A) designates that the title is to go to some other person upon the death of the life estate holder (B), the person so designated (C) is said to have an estate in remainder.

Question 42

Fee Simple Defeasible is?

Answer 42

The term Fee Simple Defeasible is when an owner holds title subject to deed restrictions. (Fee simple qualified (defeasible), which the owner holds title subject to special conditions, limitations, or private deed restrictions that limit the use of the property.)

Question 43

A, B, and C are joint tenants, and they hold title to the NW 1/4 of Section 24 in some township. C deeds her interest to D. A) D is a joint tenant with A and B B) D acquired approximately 53.33 acres C) D owns a one-third interest in 160 acres D) A, B, and D are all tenants in common with each other

Answer 43

C) D owns a one-third interest in 160 acres. 1/4 of Section 24 = 160 A, B, and C = Joint Tenants 640 divided by 4 (1/4NW) = 160 acres

Question 44

How can you remove an easement on a parcel of land from the records?

Answer 44

The most common way to terminate an easement is by express release. The dominant tenement usually issues a quitclaim deed to the servient tenement owner, which extinguishes the easement.

Question 45

In California, without any evidence to the contrary, a husband and wife or registered domestic partners are presumed to hold title as?

Answer 45

Community Property

Question 47

If an owner files a notice of completion, a general contractor has how many days to file a mechanics' lien?

Answer 47

Sixty Days

Question 48

What are the four unities of joint tenancy?

Answer 48

1) Unity of Time 2) Unity of Title 3) Unity of Interest 4) Unity of Possession

Question 49

For a married person or registered domestic partner, what is most likely to always be delegate property?

Answer 49

Gift

Question 50

A plaintiff takes a case to court and obtains a judgment. To create a lien on the defendant's property, the plaintiff must record what?

Answer 50

An Abstract of Judgment.

Question 51

Materials were delivered to a building site for the construction of a commercial building. To be sure the supplier can collect for the cost of the material, he or she should file what?

Answer 51

A Preliminary Notice (The law requires that all mechanics and material suppliers must give written notice to the owner, the general contractor, and the construction lender, if there is one, of their right to file a lien against the property if they are not paid.)

Question 52

What does 'ingress' mean?

Answer 52

Entering

Question 53

When a property owner discovers that a neighbor has built a structure on a portion of his or her property, how long does the property owner normally have to bring an action against the neighbor?

Answer 53

Three Years

Question 54

What does 'egress' mean?

Answer 54

Exiting

Question 55

A judgment is considered what type of lien?

Answer 55

An Involuntary Lien. Could also include mechanics' lien, tax liens, and attachments.

Question 55

Once properly recorded, how long is an abstract of judgment good for?

Answer 55

Ten Years

Question 56

Can an infant take title to real property?

Answer 56

Yes, an infant can receive title by gift or inheritance but cannot convey title without a guardian or other court approval.

Question 57

Define 'estates'?

Answer 57

An estate is defined as the degree, quantity, nature, and extent of interest a person has in property.

Question 58

What is a 'deed'?

Answer 58

A deed is a written document by which (when properly executed, delivered, and accepted) title to real property is transferred from one person, called a grantor, to another person, called a grantee.

Question 59

If an owner files a notice of completion, a subcontractor has how many days to file a mechanics' lien?

Answer 59

Thirty Days

Question 61

Can a person take title under an assumed name?

Answer 61

Yes, but upon resale, he or she may have difficulty proving identity for a notary public.

Question 62

Private deed restrictions are known as CC&Rs. What does the first C stand for?

Answer 62

Covenant *covenant, conditions and restrictions*

Question 62

If a landlord wishes to be protected from a mechanics' lien on work ordered by a tenant, upon discovery of the work, the landlord must file a notice of no responsibility within how many days?

Answer 62

Ten Days

Question 63

A real estate agency exists between: A) The seller and the buyer B) The broker and the principal C) The borrower and lender D) The landlord and tenant

Answer 63

B) The Broker and Principal Principal (seller) appoints agent (real estate broker) to find a buyer.

Question 64

What is a fiduciary relationship consist of?

Answer 64

A fiduciary relationship is one of loyalty, obedience, and confidentiality.

Question 65

The use of cooperating agents is illegal under California law? True or False

Answer 65

False. If the seller gives permission in the listing agreement, an agent can assign some of his or her duties to other licensed agents. The other agents are called subagents but most feel uncomfortable being called subagents so instead prefer to be viewed as cooperating agents.

Question 66

What are the three ways a real estate agency can be created?

Answer 66

1) Agreement 2) Ratification 3) Estoppel

Question 67

There are six ways to terminate a real estate agency. What are they?

Answer 67

Termination by: 1) Competition of the agency agreement 2) Expiration of Time 3) Death of the principal or death of the agent 4) Destruction of the property 5) Mutual consent 6) Unilateral action of the agent or the principal

Question 68

How does a salesperson become an agent?

Answer 68

By his or her association with a broker. A salesperson's license is valid only when he or she is working for a real estate broker. It is through this association with the real estate broker that a salesperson also becomes an agent.

Question 69

A salesperson collects his or her commission directly from the seller. True or False

Answer 69

False. A real estate salesperson can receive compensation only from his or her broker. When escrow is closed, the escrow company usually sends the entire commission to the employing broker, who in turn writes a delegate check to the salesperson.

Question 70

Unless instructed to hold the check unwashed, a buyer's deposit must be placed with the appropriated party or account within how many business days?

Answer 70

Within three business days.

Question 71

The maximum amount per individual claim against the Department of Real Estate Recovery Fund is?

Answer 71

$50,000

Question 72

When a real estate agent mixes his or her personal funds with that of a principal, the agent is guilty of what?

Answer 72

Commingling

Question 73

In today's real estate market, when a real estate agent uses agents from other real estate companies to help find a buyer, the other agents are called?

Answer 73

Cooperating Agents

Question 74

Under a buyer's agency, the fiduciary relationship is between the broker and who?

Answer 74

It is between the broker and the buyer.

Question 75

What is the most common form of a listing agreement found in California?

Answer 75

An exclusive authorization and right-to-sell listing.

Question 76

What listings must have a definite termination date?

Answer 76

Exclusive agency and exclusive authorization and right-to-sell listing.

Question 77

What listing stipulates that the agent may earn anything over the seller's stipulated amount after giving the seller proper disclosure?

Answer 77

A net listing

Question 78

A listing is?

Answer 78

A bilateral contract

Question 79

What is another term for 'deposit receipt'?

Answer 79

A purchase agreement

Question 80

A contract that still needs some action by one or more of the parties is?

Answer 80

Executory

Question 81

Who signs the real estate transfer disclosure statement?

Answer 81

Buyer, seller, and agent/broker.

Question 82

What is Megan's Law?

Answer 82

Megan's Law shows the location of registered sex offenders.

Question 83

A fully amortized promissory note with equal payments to liquidate a debt would be a what?

Answer 83

An installment note

Question 84

Under a deed of trust (trust deed), the lender is?

Answer 84

The beneficiary

Question 85

What is a due-on-sale clause?

Answer 85

An alienation clause

Question 86

The disclosure requirement concerned with special flood areas, dam failure, high fire severity, wildland forest fires, earthquake fault zones, and seismic hazard zones is the?

Answer 86

Natural hazard disclosure statement

Question 87

Under which financing. Instrument is the seller known as the vendor?

Answer 87

An installment sales contract

Question 88

Once a trustee records a notice of default, how much time does the borrower have to make up the delinquencies and stop the foreclosure?

Answer 88

Ninety days prior to the sale

Question 89

The executrix of an estate is?

Answer 89

Named in the testator' will.

Question 90

"Beginning on a point on the North line of Bard Avenue distant 218.00 feet East from the Northeast corner of Bard Avenue and Elm Street." This legal description is?

Answer 90

Metes and bounds

Question 91

Recording of a deed gives?

Answer 91

Constructive notice

Question 92

A telephone company's right to enter your property to maintain power lines is an example of?

Answer 92

A mechanics lien

Question 93

If zoning laws allow a property to be used in such a manner that is prohibited by a lawful deed restriction, the..?

Answer 93

Zoning allowance should prevail over a deed restriction.

Question 94

If a real estate salesperson decides to work for a new broker, the existing listings obtained by the salesperson belong to whom?

Answer 94

The former broker

Question 95

Ms. Lightdeer showed a property to Mr. and Mrs. Chu without having an agency agreement with the owner. Later the owner accepted the offer to purchase, which was submitted by Ms. Light deer on behalf of Mr. and Mrs. Chu. The owner consented to Ms. Lightdeer's unauthorized acts. Under these circumstances, an agency could be created by?

Answer 95

Ratification

Question 96

Homeowner Raymond appoints Broker Cecilia to find a buyer. Later a qualified buyer is found, all papers are signed, and all loans are approved. The home is scheduled to be transferred on June 1. On May 30, Homeowner Raymond dies. What happens?

Answer 96

The real estate agency is canceled, and Broker Cecilia has earned the commission.

Question 97

If during the escrow process but prior to closing the sale, a fire destroys the home being sold, what would happen?

Answer 97

The buyer need not complete the purchase and is entitled to the deposit back.

Question 98

When a buyer is purchasing a condominium or a unit in a planned unit development (PUD), said buyer must be given which of the following regarding the CC&Rs, homeowner dues, and financial and legal status of the homeowner's association? A) A seller financing addendum and disclosure statement B) A real estate transfer disclosure statement C) A common interest development general information D) A natural hazard disclosure statement

Answer 98

C) A common interest development general information

Question 99

A buyer and seller sign a valid California Residential Purchase Agreement and Joint Escrow Instructions contract. Per the terms of this contract, any statutory and lead disclosures cannot be waived by the mutual agreement of the buyer and the seller. True or False

Answer 99

True