Step 1 of 50 2% 1. A seller has a free-standing cabinet that was custom-made to fit in the corner nook of the house. When the house sells, what type of property is this? Personal property Chattel Fixture Trade fixture 2. A state wants to build a publicly owned convention center to attract private development in its largest city. Can the state use eminent domain to acquire the land? No, because private investments would not be allowed. Yes, if just compensation is paid to the owners of the land. No, because eminent domain can only be used for highway expansion. Yes, if the owners hold fee-simple interest in the land. 3. An owner lists his home and agrees to pay a 6% commission provided he nets $10,000 after paying the commission and the balance of his mortgage, which is $75,000. To the nearest dollar, what should the selling price be to net the owner his $10,000 (rounded to the nearest dollar)? $90,426 $90,100 $85,638 $89,787 4. All mortgage paperwork, contracts, and disclosures have been delivered to the buyer. What situation will automatically give the buyer 3 days to review the paperwork? APR change Inspection repairs completed Home warranty documents Title work 5. Buyer wants to purchase an old gas station and turn it into a doughnut shop. What type of environmental inspection will the lender require? Phase I Phase II Phase III The lender cannot make any requirement. 6. Purchase agreement states the tenants will be gone from the property by closing. Closing is completed and tenants are still there. Whose responsibility is it to make sure the tenants are gone? Seller Seller’s agent Buyer Buyer’s agent 7. Under the terms of their listing contract, the owners may sell their house themselves and pay no commission. If their agent sells it, a commission will be due. What kind of listing contract does the owners have? Exclusive agency listing Exclusive right-to-sell listing Exclusive ownership listing Net listing 8. You and your husband live in a community property state. Which of the following assets owned by you would be considered community property? A car given to you after your marriage. A duplex that you and your husband purchased after your marriage. Stock inherited by your husband after your marriage. A house that you owned before you were married. 9. One who has ownership rights of real estate that could continue forever, and which provide that no other person can claim to be the owner of or have any ownership control over the property has fee simple interest life estate determinable fee condition subsequent 10. Which of the following terms would include the interests, benefits, and rights inherent in the ownership of real estate? Chattel Personal property Real property Trade fixtures 11. Two people own a three-unit apartment building as joint tenants. One wants to sell but the other does not. Which of the following statements describes the legal rights of the party who wants to sell? The party may request a court to partition the building. The party may require the co-owner to sell. The party may record a lis pendens on the property. The party may refinance the mortgage in her or his own name, thus eliminating the co-owner's interest in the property. 12. A deed contains a promise that the title conveyed is good and a promise to obtain and deliver any documents necessary to ensure good title. This deed contains an example of which covenant? Further assurances Seisin Quiet enjoyment Warranty forever 13. What is the required earnest money deposit in a purchase contract? 1% 5% $1,000 0% 14. Which person would NOT be protected under the familial status definition according to the federal fair housing law? A 19-year-old girl living with her mother A 17-year-old boy living with his father A 14-year-old girl living with a person who is seeking legal custody of her A 21-year-old woman who is pregnant 15. A buyer wants to purchase a home for $60,000. The lender appraises the home for $58,000 and offers to finance it with an 80% LTV loan charging a loan origination fee of 1.5 points. How much will the buyer’s loan origination fee be? $696 $720 $900 $870 16. A broker was offered a listing by homeowners who stated that they would not sell to a minority. The broker should accept the listing and allow the owners the right to choose the buyer. file a complaint with the local board of REALTORS®. accept the listing and ensure that no minorities are shown the property. refuse to accept the listing based on this condition. 17. Phillip signed an offer to purchase in a state of obvious drunkenness. The next morning, he realized what he had done and told the broker that he did not want to be bound by the terms of the contract. This would be an example of a(n) valid contract. void contract. voidable contract. unenforceable contract. 18. You had an exclusive-right-to-sell listing with a seller, and you showed the property to a prospective buyer during the listing term. The seller openly negotiated with this prospective buyer and asked him to wait until the listing had expired to buy the property so there would be a commission savings on the transaction. You found out that the property was sold to the prospective buyer within a month of the time the listing expired. Are you entitled to a commission? Why or why not? No; because the entire transaction occurred after the listing expired. No; because exclusive right-to-sell listings allow the seller to sell the property themselves without owing a commission. Yes; because you were the procuring cause of the sale. Yes; because you are entitled to a commission if the property is sold by anyone within a year of the listing period. 19. Which of the following is a requirement for a valid deed? The grantee must sign the deed The consideration must be in dollars It must contain a subordination clause It must contain a granting clause 20. An agent is showing a customer a house and no agency has been confirmed. What statement would indicate to the customer that you are NOT their buyer agent: You should get preapproved because most offers require it. You should have a home inspection. You should offer $20k under asking because comps don’t support this. You should consider all options before making any decision. 21. You and your brother have purchased an apartment building as joint tenants. All the following statements correctly describe your situation EXCEPT you and your brother hold the right of survivorship owners must be related in order to own joint tenancy the unities of title, time, interest, and possession are required to create a valid joint tenancy you and your brother may partition the land. 22. The main difference between tenancy in common and joint tenancy is that with tenancy in common, when a co-owner dies, his undivided interest passes to the surviving co-owners. his undivided interest passes to his heirs. his undivided interest must be sold. his undivided interest is equally shared between his heirs and surviving co-owners. 23. Becky contacts a real estate agent to discuss selling her mom’s house, which her mom (deceased) had in a trust. Becky mentions her two sisters are also listed on the trust. What should the agent do? List the property with Becky’s authorization Get Becky’s ID and a copy of the trust, review it, and decide the next steps Have her sisters sign a liability form/waiver that allows the sister to negotiate and sign on their behalf Have an attorney review the trust documents. 24. A claim based on adverse possession of property must NOT be Notorious. Open. Hostile. Secretive. 25. You removed an old furnace and installed a new furnace with central air conditioning in your home. This newly installed personal property becomes a trade fixture. chattel fixture. fixture. land fixture. 26. A homeowner is willing to let his neighbor park an RV in his backyard. He does NOT want to make the permission permanent in case he dislikes others who might move next door in the future. What should he give his neighbor? License Easement appurtenant Encroachment Easement by necessity 27. Andrew, who works for broker Christopher on a 50-50 basis, sold a house listed by broker Elisa for $193,950. The seller agreed to pay a 6% commission but stipulated in the listing that 60% was to go to the selling broker. How much commission will Andrew make on this sale? $2,327.40 $2,909.25 $3,491.10 $4,189.32 28. You listed a home for sale under an exclusive right-to-sell agreement and showed the property to a person who wrote an offer with an earnest money check that was subsequently rejected by the owner. What should happen to the earnest money check? It should be deposited into the broker's trust account. It should just be returned to the buyer. It should be returned to the buyer only after the seller signs a release form. It should be given to the seller. 29. A lender will make an 80% LTV loan on a property that appraised for $72,250 and sells for $73,500. If the buyer has saved $14,450 for a down payment, how much more will he need in order to make the down payment required? $1,250 $0 $250 $750 30. A meat packing plant has just been built one block from your house. The strong odors are lowering property values in your neighborhood. The loss in value would be classified as Functional obsolescence Physical deterioration Principle of change External obsolescence 31. In theory, which of the following types of deeds gives a property buyer the MOST protection against problems that may arise with the title? Quitclaim Bargain and sale Special warranty General warranty 32. A town located near a small recreational lake enacts a new zoning code. Under the new code, commercial buildings are not permitted within 1,000 feet of the lake. A commercial building that is permitted to continue in its former use even though it is built on the lakeshore is an example of nonconforming use. variance. special use. conditional use. 33. To be valid, every deed must be executed by the grantor. be executed by the grantor and the grantee. be executed by the grantee. signatures are not required to create a valid deed. 34. A property owner got an offer from two parties. The first offer is from a company that wants the property’s mineral rights. The second offer is from a farmer that wants the land for a cow farm. What should an agent advise in the client's best interest? Sell the surface rights to the cow farmer and subsurface rights to the mineral company. The seller must choose only one buyer as the seller cannot sell the property to two buyers. Suggest finding a buyer that wants all the land. Take the home off the market. 35. An old couple comes to an agent to buy a house. They state that if the husband dies, they want his wife to inherit the house. They ask what type of ownership they should take. What is inappropriate for an agent to suggest? State this is beyond the agent’s expertise and cannot help them. Advise them to speak with an attorney. Recommend they take title with joint tenancy or tenancy by entirety. Suggest they consider setting up a trust or life estate with a licensed professional. 36. In a mortgage loan, discount points: decreases the yield for the lender increases the yield for the lender decreases the yield for the seller increases the yield for the seller 37. Your home is valued at $143,000. Property in your city is assessed at 80% of its value, and the local tax rate is $3.65 per $100. What is the amount of your monthly taxes? $319.37 $347.97 $352.73 $357.50 38. A contract in which the intentions of the parties are shown by their conduct is an express contract. an implied contract. a bilateral contract. an executory contract. 39. A property is in an area that is a very hot market that has been increasing in value, but a company in the area has shut down. What should the agent suggest to the seller? Attempt to house sell now Wait until a new company opens up Wait as the market will likely continue to go up in value Sell the house now at a bottom dollar price since the market will fall 40. A 5-unit apartment complex rents each unit for $850 per month. One of the unit tenants did not pay rent for 3 months. What is the effective gross income for this property? $48,450 $51,000 $4,250 $2,550 41. You are taking a listing on a property and notice that a neighboring building appears to have a roof overhang encroaching on the property line. The seller has never noticed this, even though the building has been there for several decades. Which of the following statements BEST identifies this situation? The seller must record a party wall easement prior to transferring title. The seller must perform a title search to discover if this represents a cloud on the title. The neighbor may be entitled to a prescriptive easement guaranteeing the right to leave the building as is. The neighbor may claim ownership of the property under the roof under the doctrine of prior appropriation. 42. Alfonso owns a life estate, and Anita holds the future interest in the life estate. When Alfonso dies, Alfonso's wife will become the owner under her dower interest. Alfonso's life estate will pass to his heirs according to the terms of his will. Alfonso and Anita will hold title as tenants in common. Anita will hold title to the property. 43. A potential buyer is interested in the residential property of your client. The buyer earns a living by making crafts and selling them from home and caring for children in the late afternoons. In this situation, you should suggest buyer check the zoning ordinances and subdivision requirements Tell the buyer to move on and not buy this property. Tell the buyer they will have no issues since the property is currently being used as a day care. Tell the buyer to ask their lender for advice. 44. A person who receives real property by will is called a trustee. devisee. testator. hypothecator. 45. Lois gave Mark a deed with no express or implied warranty. The deed was MOST likely a general warranty deed special warranty deed bargain and sale deed quitclaim deed. 46. Which statement best explains why instruments affecting real estate are recorded? Recording gives constructive notice to the world of the rights and interests claimed in the identified parcel of real estate. Failing to record will void the transfer. The instruments must be recorded to comply with the terms of the statute of frauds. Recording proves the execution of the instrument. 47. A broker has listed a home. The broker is generally considered to have earned her commission when she submits an offer to purchase to the seller. the seller indicates that he thinks an offer to purchase is acceptable. she finds a "buyer ready, willing, and able" to buy on the terms of the listing. the closing takes place. 48. A seller wants to extend the closing timeline after signing a contract to 40 days. The original contract has 30 days for closing. All the following are options for the seller, EXCEPT Seller can ask buyer to make this change bilaterally. Buyer and seller can sign a contract amendment changing the date. Seller can unilaterally make this change since it benefits the parties. Buyer and seller can mutually agree to rewrite the original contract with the change to the date. 49. An easement can be terminated by all the following, EXCEPT non-use of a prescriptive easement. merger of titles. release of easement by servient tenement. release of easement by dominant tenement. 50. A tenant has right of first refusal to purchase a space they are currently renting. If the seller does not sell the property, what remedies can the tenant pursue? Sue the seller for specific performance. The tenant has no recourse. Break the lease with the landlord. Reduce the rent to make up for the loss in rental expense
