A mortgage or trust deed is considered to be
a. an estate in land.
b. a promissory note.
c. chattel.
d. debt security.
A borrower does not have the right, under the truth-in-lending laws, to rescind a credit
transaction
a. for a consumer loan on personal property.
b. for the acquisition of the borrower’s principal dwelling.
c. both a and b.
d. neither a nor b.
For a successful wraparound, it is necessary to have an existing mortgage with
a. a below-market interest rate.
b. a due-on-sale clause.
c. an above market interest rate.
d. an alienation clause.
From an investor’s point of view, which is the most attractive allowable depreciation
period for an investment property?
a. 40 years
b. 30 years
c. 27.5 years
d. 15 years
Commercial banks are most likely to deal heavily in
a. interim loans.
b. 40-year residential loans.
c. home improvement loans.
d. VA loans.
The real estate brokerage industry is an example of a
a. base industry.
b. secondary industry.
c. export industry.
d. primary industry.
The “Americans With Disabilities Act” deals primarily with
a. single family residences.
b. multi family residences.
c. commercial properties.
d. all real estate.
A borrower signs a loan agreement for $50,000. Out of this, the lender charges a
$500.00 loan origination fee and two discount points. How much cash does the
borrower get?
a. $46,600
b. $47,000
c. $48,500
d. $49,000
A corporation, composed of many stockholders, desired to take title to real property.
They would most likely take title
a. as a legal life estate.
b. in severalty.
c. as tenants in common.
d. as holders of corporate property.
Documents are recorded by
a. placing the original document on file in the recorder’s office.
b. submitting the original document which is photocopied and placed on file.
c. copying the original document and returning it and the copy to the grantor.
d. filing the name and address of the property owner.
Which of the following is an essential element of a contract?
a. A counter offer
b. Acceptance
c. Performance
d. A fair price
From whom would a borrower obtain a VA or FHA loan?
a. Approved mortgage lender
b. VA or FHA
c. Insurance companies
d. Sale of bonds
The New York fire insurance form
a. was originally enacted by the legislature of New York state.
b. provides the foundation for most property damage insurance policies in this country.
c. both a and b.
d. neither a nor b.
Current legal thinking with regard to owner’s obligations under a residential rental
contract is that
a. if a service is not promised in writing, it will not be forthcoming.
b. the owner is obligated to keep the premises repaired.
c. the owner has an obligation only to collect the rent and pay the utilities.
d. only expressed agreements may be pursued in court.
Who benefits the most by the inclusion of a subordination clause in a mortgage?
a. Borrower
b. Lender
c. Selling broker
d. Trustee
When property is purchased using a land sales contract, the instrument used to convey
legal title would be
a. an executory deed.
b. a bargain and sale deed.
c. a warranty deed.
d. non-existent since legal title is not transferred until the contract is paid off.
The covenant, which states that the grantor is the owner and has the right to convey, is
called the covenant of
a. quiet enjoyment.
b. seisen.
c. further assurance.
d. encumbrances.
A valid, written lease will automatically be terminated by
a. death of the lessor.
b. sale of the leased premises.
c. court eviction of the tenant.
d. imprisonment of tenant.
Local government programs and services are financed primarily through
a. property taxes.
b. federal income taxes.
c. state income taxes.
d. state sales taxes.
If the vendee is in default, the vendor
a. cannot pursue the right of foreclosure.
b. is in title.
c. no longer has equitable title.
d. retains color of title.
One of the advantages of condominium ownership versus cooperative ownership is that
a. condominium ownership has no common ownership.
b. cooperative ownership is free from periodic dues from members.
c. cooperative ownership is usually corporate owned and sells stock through the
secondary money market.
d. condominium units can be individually mortgaged.
A contract entered into by a minor is
a. illegal.
b. voidable.
c. valid.
d. unenforceable.
A real estate contract can be declared void if
a. it is signed and not read.
b. It is signed with a witnessed X.
c. signed by only one party.
d. it is signed by an unmarried minor.
Truth in lending laws require a lender to provide figures for all EXCEPT
a. loan amount.
b. interest rates.
c. maintenance costs.
d. annual percentage rate.
A licensed salesperson is paid 2% commission on all sales that he produces. How much
dollar volume of real estate would she have to sell each month to make $3,500 per
month?
a. $122,900
b. $135,000
c. $175,000
d. $210,000
In a general partnership
a. each partner has limited financial liability.
b. each partner pays individual taxes on his or her share of the partnership’s earnings.
c. the right of survivorship exists.
d. individual shares are not taxed.
You are offered a four-unit residential building in which each unit rents for $500 per
month. Given a 5 percent vacancy rate, operating expenses of $700 per month, and
mortgage payments of $1,500 per month, you can anticipate a monthly
a. net spendable income of $200.
b. net spendable income of $300.
c. negative cash flow of $200.
d. negative cash flow of $300.
Which of the following is true of an acknowledgement?
a. It may be witnessed by a notary public.
b. Many states require that deeds be acknowledged before title passes.
c. The notary must attest that the deed is valid.
d. It is required by the Statute of Frauds.
What feature in an adjustable rate mortgage protects the borrower against very large
monthly payment increases?
a. Index rate
b. Adjustment period
c. Interest rate cap
d. Margin
When land that was previously zoned for higher-density use is rezoned for
lower-density uses, it is called
a. spot zoning.
b. buffer zoning.
c. conditional use.
d. down zoning.
Since real estate agents will be handling other people’s money, some states will examine
licensee’s
a. bank account.
b. credit history.
c. age.
d. financial statement.
Improvements made to real property become part of the real property because of
a. reliction.
b. attachment.
c. devise.
d. descent
Four unities are required for the creation of joint tenancy. They are time, possession,
interest, and
a. consideration.
b. competent parties.
c. title.
d. legal purpose.
Hallie and Wally, husband and wife, owned property as tenants by the entirely. Wally
sold the property without his wife’s signature. One day later, he died. The property goes
to
a. the purchaser.
b. the purchaser and Hallie share equally.
c. Hallie who owns the entire estate.
d. no one, there is a cloud on the title.
The Society of Real Estate Appraisers offers the CREI designation.
A single woman applied for an FHA loan to buy a property she intends to use as a
rental. Her application will probably be denied.
A nonjudicial foreclosure does not go to court and is not heard by a judge.
Most states do not require that documents be acknowledged before being eligible for
recording.
Both fiat money and real savings represent ____________________ labor and
materials.
When a lender voluntarily takes a lower position than he would normally be entitled to
the process is known as ____________________.
RESPA prohibits ____________________ and fees for services not performed during
the closing process.
In an escrow closing, funds are disbursed when all escrow papers have been signed and
the buyer brings in the money.
For land title to be passed, the deed must be recorded.
The margin is for the lender’s cost of doing business, risk of loss on the loan, and profit.
Under an exclusive authority to purchase agreement, the buyer becomes a principal.
The Americans with Disabilities Act is a federal law giving individuals the right of
access to ____________________ facilities open to the public.
____________________ laws divide land into zones (districts) and within each zone
regulate the purpose for which buildings may be constructed.
A(n) ____________________ of ____________________ is the linkage of property
ownership that connects the present owner to the original source of title.
The difference between the market value of a property and the debt owed against it is
called the owner’s ____________________.