An existing structure that would be prohibited under current zoning laws is called
a. a restrictive zone use.
b. a nonconforming use.
c. an impact statement property.
d. a land use restriction.
A woman who lived in a retirement home and had no relatives, told her friend that she
wanted her to have all of her property after she died, however she never made a will.
Upon her death, her estate would
a. pass to the friend, since that was her wish.
b. pass to the retirement home where she lived.
c. escheat to the state.
d. pass to an entity determined by the probate court.
A property is sold and the buyer promises the seller in writing that he, the buyer, will
repay the existing loan. This is called
a. assuming the loan.
b. buying down the loan.
c. loan satisfaction.
d. a partial release.
Community property could include
a. property acquired by one spouse before marriage.
b. gifts made to one spouse or the other.
c. property inherited by one spouse or the other.
d. property acquired before marriage and maintained with community funds.
A preliminary title insurance report will show all of the following EXCEPT
a. unrecorded easements.
b. mortgages of record.
c. property taxes and assessments.
d. judgements against the seller.
The sum of money agreed upon in advance to be the damages in the event certain
problems occur later is best described as
a. judgement damages.
b. liquidated damages.
c. default damages.
d. punitive damages.
The concept of insurance is to
a. reimburse the insured for financial losses.
b. insure that a loss-causing event will not occur.
c. both a and b.
d. neither a nor b.
Ownership in severalty occurs when
a. two or more persons have identical interests in the same property concurrently.
b. husband and wife share ownership of the same property.
c. property is owned by one person.
d. two or more persons own the same property in any form of title.
The exact layout of a subdivision is usually shown in detail on the
a. deed.
b. plat.
c. plot.
d. CC&Rs.
The basic authority for zoning laws is derived from a state’s
a. powers of eminent domain.
b. right of taxation.
c. both a and b.
d. neither a nor b.
If a foreclosed property has sold for less than the loan amount, the difference between
the indebtedness and the sale price of the real estate at the foreclosure sale is called the
a. net price.
b. deficit.
c. net market value.
d. deficiency.
A woman owns an $86,000 house on which she pays $329 per month interest. If she is
in a 28% tax bracket, how much less tax will she have to pay per year because she owns
it?
a. $131.60
b. $653.49
c. $1,105.44
d. $2,763.60
A real estate broker differs from a real estate salesperson under the law in that the
a. broker is liable for the acts of the salesperson.
b. salesperson may take a listing with him when he changes brokers.
c. law recognizes no differences.
d. salesperson is responsible for the acts of the broker.
Penalties for violation of the truth-in-lending laws include
a. a fine of up to $5,000 and/or imprisonment for up to 1 year.
b. penalties up to twice the amount of the finance charge up to a maximum of $1,000.
c. Court costs, attorney fees, and actual damages.
d. all of the above.
A lease for six months is classified as
a. a periodic estate.
b. an estate at sufferance.
c. an estate at will.
d. an estate for years.
A contract for deed on residential property
a. allows transfer of title to the purchaser at the inception of the mortgage.
b. transfers title to the purchasers at the fulfillment of the conditions of the mortgage.
c. does not provide for transfer of title.
d. requires the owner to occupy the property.
A land sales contract passes
a. the right to destroy the property.
b. equitable title.
c. legal title.
d. no interest whatsoever.
Pat bought a home for $75,000. He put up $5,000 earnest money and secured an 80%
loan. The bank charged four points and a 2.5% loan fee. Pat received a $900 credit from
the proration of taxes. How much cash will he need to bring to close this transaction?
a. $13,000
b. $13,900
c. $13,975
d. $18,000
The process of dividing ongoing expenses and income items as of the closing date is
called
a. prorating.
b. “as is” basis.
c. closing.
d. arbitrating.
A state-run program where real estate license fees are used, in part, to pay uncollected
judgements against licensees is a
a. bonding program.
b. recovery fund.
c. multiple listing service.
d. equalization fund.
The added value resulting from the combination of two or more parcels of land is called
a. replacement value.
b. liquidation value.
c. plottage value.
d. subjective value.
If the insured wishes to cancel his New York fire form policy,
a. he must give a 5-day notice.
b. he will receive a prorated refund.
c. his refund will be based on short-rate premiums.
d. he will receive no refund.
An investment property was purchased in 2008 for $180,000. The land accounted for
30% of this value. If figured on a 30-year life, what was the book value of this property
after one year of straight-line depreciation?
a. $54,000
b. $121,800
c. $126,000
d. $175,800
In any valid lease, the lessor by law gives an implied covenant of
a. quiet enjoyment.
b. satisfaction.
c. reconveyance.
d. undue duress.
A person owns property in severalty. He dies testate so the property
a. is acquired by the surviving joint tenant.
b. is probated and distributed according to the will.
c. escheats to the state.
d. is distributed equally among his relatives.
A licensed salesperson participating in a real estate transaction is allowed to accept a
commission from
a. the seller.
b. the buyer.
c. his broker.
d. the title company.
A power company wants to lay a service line across customer properties and must
acquire an irrevocable right to do so. This right would be called
a. an easement appurtenant.
b. an easement in gross.
c. a license.
d. an irrevocable lien.
The amount of money required to duplicate a property as of a certain date is called
a. reproduction cost.
b. depreciation cost.
c. duplication approach.
d. capital improvement.
The borrower under a deed of trust is called the
a. trustor.
b. beneficiary.
c. trustee.
d. grantor.
By the year 1980, in order to curb inflation, the policy of the Federal Reserve became
one of
a. generous monetary growth.
b. negative monetary growth.
c. restrained monetary growth.
d. constant, no-growth monetary supply.
The type of loan whereby the borrower makes interest only payments during the life of
the loan with the entire principal due for the final payment is called
a. a discounted loan.
b. an amortized loan.
c. a term loan.
d. a partially amortized loan.
With regard to real estate loans, life insurance companies tend to favor
a. single family houses.
b. interim construction loans.
c. large commercial buildings.
d. not being involved in real estate.
In most states, a person is exempt from licensure as a real estate agent when performing
which of the following activities, even if receiving a fee?
a. Renting resort condominiums for the owner as a commissioned rental agent
b. Negotiating an exchange of properties where no cash changes hands
c. Selling real property as an executor of an estate
d. Dealing in land options
The extent to which regions and cities are vulnerable to changes in the economic base
has little to do with the ability of base industries to consistently export their products.
____________________ is a broad term that simply refers to two or more individuals
who have combined to pursue an investment enterprise too large for any of them to
undertake individually.
Using the rule of thumb, which states that each discount point raises the yield by 1/8 of
1%, two discount points raise the effective yield of a typical home loan by1/4 of 1%.
The greatest estate in real property is a fee simple estate.
When a property sells at a foreclosure sale for less than the debt, a(n)
______________________________ may allow the lender to proceed against the
borrower’s other unsecured assets.
Under the provisions of RESPA payments outside closing are prohibited.
Kitty, a broker, has an option to purchase a residence which the owner has also
employed Kitty to sell for a commission. Before Kitty can exercise the option, she must
give notice to the seller that she will collect two commissions.
An insurer may suspend an insurance policy if the insured allows the hazard exposure
to the insurer to increase beyond the risks contemplated when the policy was issued.
A United States taxpayer can, on his income tax report, deduct depreciation on a tenant
occupied suburban home.
Almost all states use the tract indexing system.
Money set aside from the budget for expenses that do not occur every month is called
reserves.
A mortgage lender will lend based on a proportion of the appraisal or sale price,
whichever is less. This is called the loan-to-value ratio.
The relationship, which is created when one person authorizes another to act on his
behalf, is called ratification.
Expectations about inflation tend to parallel actual changes.
A listing agreement is a(n) ____________________ contract between a property owner
and a real estate broker.
The basic support for validity of the market data approach to appraisal iswilling buyers
and willing sellers acting without undue pressure.
The lessee’s right to quiet enjoyment allows the landlord no right of entry.
Municipal bonds that provide a source of mortgage money for home buyers pay interest
that is tax-free from federal income taxes.