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Which of the following forms of co-ownership, historically used for apartment buildings, is not considered a form of true direct co-ownership, but rather qualifies as a proprietary corporation? A.Cooperative B.Tenancy by the entirety C.Condominium D.Partnership A fishing company was formed […]

Most Adjustable Rate Mortgage (ARM) loans have been marketed with a temporarily reduced interest rate commonly referred to as a: A.rate cap B.teaser rate C.payment cap D.prepayment rate When using discounted cash flow analysis for valuation, an appraiser will prepare […]

Traditional home mortgage underwriting is said to rest on three elements, the “three C’s.” The housing expense ratio is one tool that lenders will use to address concerns associated with which of the “three C’s?” A.Collateral B.Creditworthiness C.Capacity D.Capability A […]

Which of the following types of ownership estates is the most complete bundle of rights, and therefore carries the greatest value? A.Fee simple absolute B.Fee simple conditional C.Ordinary life estate D.Legal life estate All taxable income from investment property sales […]

The starting point in calculating net operating income is the total annual income the property would produce assuming 100 percent occupancy and no collection losses. This is commonly referred to as: A.effective Gross Income B.potential Gross Income C.operating expenses D.capital […]

Given the following information, calculate the cash down payment required to purchase the specific property. Purchase Price: $500,000, Loan Amount: 80% of purchase price, Up-front financing costs: 2.5% of loan amount. A.$90,000 B.$110,000 C.$136,250 D.$200,000 Under certain circumstances, investors are […]

As with any valid contract, enforceable leases must meet a number of requirements. One of these requirements is for each party to provide appropriate consideration. In a lease, which of the following constitutes the landlord’s consideration? A.Promise to pay rent […]

Operating expenses can be divided into two categories: variable and fixed expenses. Which of the following best exemplifies a fixed expense? A.Utilities B.Property management C.Property taxes D.Trash removal Real estate taxes represent the largest single source of revenue for a […]

Especially in terms of retail properties, which of the following attributes is considered the most likely to result in drastic value differences between otherwise similar properties? A. Structural attributes B. Financing attributes C. Location attributes D. Land attributes Jeff owns […]

The expected costs to make replacements, alterations, or improvements to a building that materially prolong its life and increase its value is referred to as: A.operating expenses B.capital expenditures C.vacancy losses D.collection losses Which of the following terms refers to […]

Assume that a borrower has a choice between two comparable fixed-rate mortgage loans with the same interest rate, but different mortgage terms, one being a 30-year mortgage and the other a 15-year mortgage. Under financially unconstrained circumstances, which of the […]

Uncertainty of cash flows can vary significantly across property types. Which of the following property types is often considered to have the most uncertain expected cash flows? A.Multifamily B.Industrial C.Office D.Hospitality While there is no specific number of comparables that […]

Given the following information, calculate the leasing agent’s commission in dollar terms. Lease Term: 10 years, Monthly Rent: $5,000, Commission: 3%. A.$150 B.$1,500 C.$1,800 D.$18,000 A city’s potential for growth or its susceptibility to decline is determined by a set […]

Since the issues in many transactions are similar, brokers often use standard preprinted contract forms. Generally, the best standard form contracts are those prepared and approved by which of the following parties? A.Buyer B.Seller C.Local Board of Realtors D.Broker Violations […]

In acting as an agent for another person, the broker carries several special responsibilities, which by law must be adhered here to throughout the transaction process. These responsibilities constitute what is commonly referred to as a: A.Subagency relationship B.Dual agency […]

Real estate brokers operate under the law of agency, which gives a broker the right to act for a principal in trying to buy or sell a property. Which of the following types of agents is authorized by the principal […]