One of the main advantages of being a limited partner is
a. the profits of a limited partner are tax free.
b. limited partners can help with management.
c. limited partners are not held responsible for management.
d. limited partners are separate legal persons.
A typical exclusive right to sell listing requires the owner to
a. exclude other brokers from advertising or placing a sign on the property.
b. pay a commission if a purchaser is found who agrees to buy at the price and terms
stipulated in the listing.
c. both a and b.
d. neither a nor b.
In an exclusive right to sell listing
a. the broker can claim a commission without presenting an offer.
b. there must be a definite termination date.
c. the broker cannot claim a commission if the seller sells the property herself.
d. there can be an indefinite term of the agreement.
If a monthly principal and interest payment for a 30-year, 12% loan of $1,000 would be
$10.29 what would the monthly payment be for a home purchased at $75,500 with an
80% loan on those terms?
a. $10.29
b. $621.52
c. $755.90
d. $776.90
In making an appraisal by the market comparison approach, an appraiser should
a. consider the physical and economic features of the subject property.
b. consider the yield of the subject’s property with competitive rates of return.
c. make adjustments to the value of the subject property with competitive rates of
return.
d. utilize comparable listings withdrawn from the market.
The practice of directing home seekers to particular neighborhoods based on race, color,
religion, sex, or national origin
a. is known as steering.
b. is prohibited by the Civil Rights Act of 1866.
c. constitutes blockbusting.
d. all of the above.
A real estate broker could most likely be held liable to a buyer if the broker
a. makes a misrepresentation to the buyer based on false information given to him by
the seller.
b. signs an agreement with the buyer on behalf of the seller under the power of attorney
granted by the seller.
c. acts in excess of the authority given to him by the seller under a listing agreement.
d. retains the buyer’s check at the seller’s request after an offer has been accepted by the
seller and acceptance has been communicated to the buyer.
Cost-push inflation is the result of
a. increased manufacturing costs.
b. increased demand for a product.
c. changes in the money supply.
d. changes in interest rates.
Fannie Mae buys and sells all mortgages EXCEPT
a. FHA loans.
b. VA loans.
c. conventional loans.
d. chattel mortgages.
A community’s economic base is determined by its ability to produce goods and/or
services for consumption within the local area.
Property taxes are
a. levied according to square footage.
b. a lien until paid.
c. based on income of the owner.
d. an encroachment until paid.
When land is gradually added to an existing parcel by the action of water, the process is
called
a. avulsion.
b. accretion.
c. erosion.
d. reliction.
A home buyer wants to borrow $100,000. The lender quotes a loan origination fee of
one point and a loan discount of one point. What size loan must be obtained to pay the
two points and still leave $100,000?
a. $96,000
b. $98,039
c. $102,000
d. $102,041
A deed which does not imply that the grantor owns title is a
a. general warranty deed.
b. special warrant deed.
c. bargain and sale deed.
d. quitclaim deed.
Escrow accounts are opened for the protection of the interests of the
a. general public.
b. seller.
c. buyer and seller.
d. buyer.
In the event of default and subsequent foreclosure, which borrower is responsible for
making good any losses suffered?
a. FHA
b. VA
c. HUD
d. 90% conventional
Lonnie and Connie had a one-year lease that ended November 30. They were still living
in the apartment as of December 12 without a new lease and without the landlord’s
permission. They have become
a. tenants at sufferance.
b. tenants in common.
c. tenants at will.
d. tenants for years.
A purchase agreement for the purchase of real property is
a. not necessary in a cash sale when the amount of earnest money paid equals the
purchase price.
b. a legally enforceable contract which is binding on the seller as soon as it is signed by
the buyer if the price and terms of the listing agreement are met exactly.
c. legally enforceable and binding on the buyer as soon as it is signed by him.
d. enforceable when the seller signs it and the buyer is notified of the seller’s
acceptance.
A promissory note
a. describes the property being hypothecated.
b. is the primary evidence of a loan.
c. is an agreement not to do a certain thing.
d. is not negotiable when secured by a mortgage.
To properly convey title to land and its building, a deed must describe the
a. land.
b. buildings.
c. appurtenances.
d. easements.
In most states, the maximum amount a broker may charge a seller is
a. 6%.
b. 7%.
c. 10%.
d. Any amount agreed to between the seller and the broker.
A municipality is installing new sidewalks in a neighborhood. The cost of this project
would most likely be paid for by means of
a. individual contracts with property owners.
b. income taxes.
c. a dedication.
d. a special assessment.
A person who sells real estate for others
a. must be licensed in order to collect compensation.
b. need not be licensed if no compensation is involved.
c. both a and b.
d. neither a nor b.
The proration of prepaid condominium association dues will result in a
a. charge to the seller and credit to the buyer.
b. charge to the buyer and credit to the seller.
c. charge to the seller and credit to the association.
d. charge to the association and credit to the buyer.
The broker and the seller know of major plumbing repairs needed on the seller’s
property. They, therefore, sell the house to a buyer “as is” but do not disclose plumbing
problems. The buyer discovers the defects after closing and decides to sue the broker
and seller. What is the most likely outcome of this decision?
a. The broker and the seller will win because of “caveat emptor”
b. The buyer has no cause because he signed an agreement to purchase “as is”
c. The buyer can collect because “as is” applies to obvious defects only
d. The buyer would probably win because the defects should have been disclosed
The role of the FHA in residential mortgage lending is
a. guaranteeing the loan.
b. insuring the loan.
c. loaning the money.
d. as a secondary lender.
Deed restrictions are examples of
a. government limitations on land.
b. private control of land.
c. police power.
d. Increased power in the hands of the zoning authority.
The phrase “time is of the essence” means
a. that the broker must present the offer quickly.
b. that the transaction must close as soon as possible.
c. that punctual performance of the time limits set by the contract is essential.
d. little, since the phrase has no specific meaning.
A borrower defaults on a deed of trust loan. Before the lender can foreclose, the lender
must
a. offer to modify the loan terms to allow the borrower to catch up.
b. appoint a trustee if the deed of trust is of the automatic trustee form.
c. notify the borrower, trustee and all interested parties of the default.
d. advertise the sale several weeks in advance and perform the sale himself, on the site
of the property securing the loan.
What is an abstract of title?
a. Title insurance
b. A history of all recorded activity affecting a parcel of real estate
c. A judgement on real property
d. A patent
The real cost of interest is the
a. rate stated on the promissory note.
b. inflation-adjusted cost.
c. annual percentage rate.
d. rate stated on the promissory note plus any discounts.
An easement may be created by a written document granting the right to another.
Monuments and points of beginning are used with the metes and bounds type of land
description.
FIRREA and the Community Reinvestment Act provided strong incentives for private
lenders to engage in affordable housing loans.
The appraisal method most likely to provide only a rough estimate of the value of a
rental property is the cost approach.
Mortgage brokers do not lend their own money but simply put lender and borrower
together.
The escrow agent is always selected by the real estate broker.
A written, exclusive right to sell listing is most likely to specify that the commission has
been earned upon procurement of a full price offer or upon acceptance of an offer by
the seller.
In using the market approach, the appraiser assumes that the cost to rebuild is related to
the present value.
Because a corporation is an entity (or legal being) in the eyes of the law, the corporation
must pay income taxes on its profits.
An insurer may suspend an insurance policy if the property is left vacant beyond a
specified time.
A mortgage secured by two or more properties is called a ____________________
mortgage.
A document issued at a tax sale that entitles the purchaser to a deed at a later date if the
is not redeemed is known as a tax deed.
A written lease agreement is still legal even though it fails to include the terms of the
lease.
A mortgagee allows a clause in his contract stating that another lender’s interest will be
allowed to take precedence over his own. This clause is a subordination clause.
In a typical limited partnership, the organizers are ____________________ partners.
The sales associate, affiliated with a broker, who brings about a sale is paid by the title
company.