Lenders on real estate mortgages may require that the borrower provide
a. a replacement cost policy on the full amount of the loan.
b. insurance in an amount equal to the purchase price of the property.
c. inflation guard coverage.
d. content coverage.
Which of the following is NOT one of the three standard approaches to value?
a. Income approach
b. Cost approach
c. Price approach
d. Market approach
A property damage or public liability policy
a. can be cancelled at any time by the insured.
b. cannot be cancelled by the insured.
c. can be cancelled at any time by the insurer.
d. can be cancelled only after 30 day’s notice by either party.
A lease under which the amount of rent is based upon the tenant’s sales volume is
known as
a. a percentage lease.
b. a gratuity lease.
c. an escalation lease.
d. usury.
When there is a sudden increase in the demand for housing in a community, the price of
existing housing will
a. rise slowly over the next 12 months.
b. rise rapidly, then fall slightly as supply catches up with demand.
c. not reflect the increased demand for approximately 12 months.
d. none of the above.
Which has the greatest effect upon the interest rate an individual must pay for a real
estate mortgage loan?
a. Federal governmental borrowing
b. State governmental borrowing
c. Local governmental borrowing
d. Competition form commercial and industrial borrowers
Depreciation resulting from the closing of a large business in a small town is classed as
a. functional obsolescence.
b. physical deterioration.
c. economic obsolescence.
d. political obsolescence..
Which of the following terms would not apply to an industry that produces goods or
services that are locally consumed ?
a. Service industry
b. Accessory industry
c. Secondary industry
d. Filler industry
When a debt secured by a deed of trust is paid off, naked legal title reverts to the
borrower from the
a. mortgagee.
b. trustor.
c. beneficiary.
d. trustee.
The most accurate way to uniquely locate and bound a parcel of real property is to use
a. an aerial photograph.
b. a topographical map.
c. a full legal description.
d. latitude and longitude.
Individual units in a condominium development are classed as
a. separate property.
b. common elements.
c. cooperative elements.
d. limited common elements.
Easements, rights of way, and condominium parking stalls are examples of
a. emblements.
b. trade fixtures.
c. riparian rights.
d. appurtenances.
The right of the mortgagor to reclaim his property upon payment in full of the
obligation is
a. reconveyance.
b. redemption.
c. recapture.
d. right of deficiency.
A licensed agent must be diligent to determine the existing zoning and building
regulations for the property that he wishes to sell. Which of the flowing would cause the
fewest problems to the agent and his buyer?
a. A home, which lies two feet outside the offset line, described on the deed.
b. A conforming business that produces such noise and odors as to be an annoyance to a
nearby neighborhood.
c. A garage that was build by the seller without a building permit and slightly on his
neighbor’s lot.
d. A multi-family apartment building that is a non-conforming use.
A notary public’s commission expires on January 1, 2010. He may take a valid
acknowledgement
a. if he applied for renewal before that date.
b. within 30 days after that date.
c. through January 1, 2010.
d. any time, because notaries are commissioned for life.
A residence originally listed at $92,000 sold for 7% less than that. If the listing broker
gets half of the 6% sales commission and he gives his salesperson 60% of that, how
much does the listing salesperson receive? (rounded to the nearest dollar)
a. $1,540
b. $5,133
c. $2,567
d. $1,026
To be considered a good investment, when a property which generates a negative cash
flow is sold,
a. there must be a substantial increase in property value.
b. there need be little increase in property value.
c. the investor is best off if the property has decreased in value.
d. there must be a substantial down payment.
A property owner who holds fee simple title to land will have all of the following
‘sticks” in his bundle of rights EXCEPT the right to
a. occupy and use it.
b. restrict the use of it.
c. devise it.
d. violate building, health and safety codes.
When a loan evidenced by a note is secured by a mortgage, the funds are furnished by
the
a. grantor.
b. beneficiary.
c. grantee.
d. lender.
Which of the following may serve as an escrow agent?
a. A bank
b. An independent escrow company
c. A lender
d. Any of the above
In a planned unit development, a developer would be likely to dedicate to the public all
of the following EXCEPT
a. streets.
b. roads.
c. parks.
d. common elements.
A brother and sister owned property in joint tenancy. All of their other affairs were
separate. The sister died penniless, leaving many unsecured debts. Her creditors could
a. attach the property that was owned in joint tenancy.
b. place alien against the brother’s other pieces of property.
c. obtain no satisfaction since the property is now owned by the brother.
d. appeal to the probate court which would pay creditors out of the sale of the sister’s
property.
The APR is
a. usually lower than the interest rate.
b. made up of the interest rate combined with the other costs of the loan.
c. both a and b.
d. neither a nor b.
A landowner wishing to deviate slightly from existing zoning codes would ask for
a. an amendment to the zoning ordinance.
b. a variance.
c. a new zoning ordinance.
d. exclusion from zoning ordinances.
Regulation Z deals with
a. annual percentage rates.
b. escrow fees.
c. truth-in-lending.
d. statue of frauds.
In most subdivisions, the developer donates to the public
a. streets and roads.
b. common areas in the subdivision.
c. park lands.
d. school land.
Other lenders providing mortgage money might include
a. pension and trust funds.
b. credit unions.
c. commercial finance companies.
d. all of the above.
Traditionally, in residential sales, prior to the emphasis on buyer agency, the broker
considers the buyer to be
a. a client.
b. a customer.
c. a principal.
d. a fiduciary.
When one party to a contract makes a promise without first receiving any promise of
performance from the other, it is called
a. a bilateral contract.
b. an implied contract.
c. a unilateral contract.
d. an executory contract.
After an earthquake, a property manager had to meet with insurance adjusters to
arrange for repairs to several properties which she managed. The property owners had
given the manager what kind of agency authority?
a. Universal
b. Special
c. General
d. Power of Attorney
In order to make adjustable rate mortgage loans more attractive to borrowers, lenders
offer
a. lower initial interest rates.
b. gifts such as appliances, trips, etc.
c. lower insurance rates.
d. lower down payments.
All of the following are true of a tenancy in common EXCEPT
a. all tenants hold an undivided interest in the entire property.
b. each tenant must have a separate deed to his/her share.
c. the tenants may dispose of all or part of their shares without the agreement of the
other tenants.
d. there is no right of survivorship among the tenants.
The person placed in charge of an escrow is called an escrow ____________________.
Mortgage ____________________ do not lend their own money but simply put lender
and borrower together.
A listing that gives the broker the nonexclusive right to find a purchaser is a(n)
____________________ listing.
In the various phases in the life cycle of improved real estate investments,
____________________ come between tenancy stage and the maturity stage.
If a person has the right to rent a house and the guaranteed opportunity to buy it at a
fixed price at a later date, he would have what is known as a lease with option to buy.
Ownership by a corporation that in turn leases space to its shareholders best describes a
cooperative.
A ____________________ statement is a statement of the unpaid balance on a note
secured by a trust deed.
The title that the borrower grants to the trustee is sometimes called
____________________ or ____________________ title.
To ____________________ means to transfer only a portion of the rights under a lease.
Provisions for the defeat of a mortgage are found in the defeasance clause.
A contract that has no binding effect on the parties who made it is a(n)
____________________ contract.
Regulation Z requires creditors to state the maximum interest rate that an ARM loan
may adjust to.
“Buy for less than $600 a month” contains a trigger term under Regulation Z and
requires further disclosure.
A license may be revoked upon proof of violation of fair housing laws.
The person giving up ownership is called the grantee.