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— Extra random (began with ca principles-6/23) —

1) When does the licensee’s duty of confidentiality to the client end?
2) Drake has a new listing, and he signs a sub-agency agreement with Erika. Erika has a buyer customer, Trinity, who wants to see the listing and eventually buys it. What’s true about the agency relationship in this situation?
3) Serena’s customer, Ben, has some defects in his property’s title. He asks her to please keep this information to herself. What’s Serena obligated to do in this situation?
4) Which laws prevent real estate licensees from setting a standard rate for commissions or compensation?
5) Eric is making an offer on his dream home. He is ready to write the earnest money check. To whom should he make the check out?
6) Fraud is always _______.
7) Buyer brokerage relationships ______.
8) What’s the overhang on a roof called?
9) Aside from price, which of the following is a legitimate reason to counter an offer?
10) Which type of buyer usually has a fixed income and is looking for a home with little to no maintenance?
11) What type of listing agreement provides the most protection for the listing agent’s commission?
12) What do you call the person who or entity that oversees trust or escrow money?
13) Tom is comparing heating systems. He’s looking at an 80,000 BTU system with an AFUE of 85%. Which of the following statements about these measures is true?
14) Which of the following bears the weight of the building?
15) Homeowners can take several actions related to pest infestations, but ______ should be left to professionals.
16) Which of the following would be considered a substantive communication about a property?
17) Which of the following items go into the seller’s credit column and the buyer’s debit column?
18) What electrical component is usually placed in the garage or basement for ease of access?
19) Which of these is a colorless, odorless, radioactive gas that is released when uranium decays?
20) What not a good idea to post photos of your clients’ expensive belongings in place?
21) Who must provide a copy of the seller instructions if a cooperating broker requests it?
22) Your Aunt Peggy works in another county and is thinking of buying a townhome. She’s working with the seller’s agent but isn’t under an agency agreement. What should you tell her about this situation?
23) When a prospective homebuyer isn’t represented, what doesn’t she have?
24) Which of these is a problem with a property that would have a negative impact on the property value or pose an unreasonable risk on the people who will reside in it?
25) Which type of contract is not based not on words, but is based on the parties’ actions or behaviors?
26) To prepare for financing, buyers should ______.
27) Before a blueprint and building specifications will receive a building permit, the blueprint must be stamped by __________.
28) Which of these must be obtained before a developer can begin construction?
29) Mixing escrow funds with personal funds is illegal and is called _______.
30) Who determines the earnest money amount?
31) Francois wants his transaction broker, Shelly, to refuse to show her other customers and clients the property he wants to buy. What should Shelly say to Francois about his request?
32) Which of the following statements best illustrates how the National Electrical Code is enforced?
33) When using the farming approach, diversity is a key factor when identifying a neighborhood. Which statement best describes diversity?
34) What’s your relationship with a buyer who’s not a client but is a customer?
35) Which party is usually responsible for appraisal and credit report fees?
36) In a transaction broker situation, the transaction broker represents _____.
37) Calculate the total debt ratio based on the following information, assuming the lender does not consider any debt with 10 or fewer payments remaining: $1,500 condo payment; $100 monthly association fees; $150 monthly student loan payment; $300 car payment (with only four payments remaining); and a monthly gross income of $5,000.
38) Which of the following would be considered a first practical opportunity for communication about a property?
39) You are not expected to be an expert at investigating or inspecting environmental issues if it is outside your area of expertise. Encourage your clients to seek professional property inspection services to determine material _______ facts.
40) Daria is representing Max, a seller. Unbeknownst to either of them, Max’s home has a serious foundation issue that is only detectable by a trained professional. This type of problem is considered a(n) ______.
41) Which of the following expenses is typically the buyer’s responsibility?
42) Jarvis is a builder. The building codes that apply to Jarvis’s work were established at what level (or levels) of government?
43) Harmful gases resulting from waste incineration are disposed of in a special process. Where are they stored once processed?
44) The seller pays for which of the following closing expenses?
45) Which fees are negotiated between the seller and the broker, and can be either a lump sum or a percentage of the listing amount?
46) As a transaction broker, you are responsible for representing _______.
47) When a loan pre-approval is provided to a buyer, what does it mean?
48) You’re working with buyers who have found their dream home, but it’s almost more than they can afford. When the appraisal comes in, it’s higher than the agreed-upon sales price. Now what?
49) What type of window consists of one or more panes that either move up and down or side to side in tracks?
50) The _______ of a property assumes normal market conditions, a willing buyer and seller, and an arm’s length transaction.
51) Licensee Brooke receives a $1,000 bonus from the seller when she encourages her buyer client to purchase the seller’s property. She doesn’t let her client know about the bonus. Has Brooke committed a violation, and, if so, what violation has she committed?
52) You represent the Taylors, who have minor children and are looking to buy a home. They ask you whether there are registered sex offenders in the area. How should you respond?
53) Which party to the transaction pays earnest money to solidify his or her commitment to completing a real estate transaction?
54) What’s the difference between direct capitalization and yield capitalization when appraising income property?
55) Llorona is working with her transaction broker, Jorge, to list her home for sale. She asks Jorge for advice on setting the listing price for her property. What is Jorge legally allowed to tell Llorona?
56) Which of the following appears on the closing statement?
57) Which of the following statements is true regarding earnest money in Kansas?
58) States where the burden to determine a property’s condition rests on the buyer are considered _______ states.
59) When preparing a market analysis, or CMA, what’s the maximum number of adjustments you can make to the subject property?
60) Bob wants an open listing agreement. Why might this not be in Bob’s best interest?
61) Andy is interested in buying a home, but his credit score isn’t the greatest. Which of the following is a way he could improve it?
62) Private sewage disposal systems, such as septic systems, are governed by the _______.
63) Marnie decided the listing she was representing would be perfect for her family. She had her brother buy it, and after closing, he sold it to her. What is this an example of?
64) Freida is planning the plumbing system for her new building project. She wants the least expensive and easiest-to-install material for all her supply lines. She’s highly sensitive to chemical smells and hopes to avoid the use of chemicals to install the pipes. What’s her best choice in piping materials?
65) What is an escalator offer?
66) A title representative offers to pay you a referral fee for sending more clients to her. Would accepting this fee be a violation?
67) Anthony meets up with his buddy, Ted, a licensee for a brokerage in Shreveport, to discuss the possibility of Anthony getting licensed. Why does his friend tell Anthony it’s so important to get E&O coverage?
68) Cameron had a listing agreement with a client named Ben. Ben got mad at Cameron and said he was terminating the agreement. Can Ben do this?
69) Sometimes when a buyer can’t qualify for a loan, the property seller drops the price and accepts a second mortgage without disclosing it to the original lender. This is a form of mortgage fraud known as ______.
70) From whom or what entity do licensees receive compensation for brokerage services once a transaction is closed?
71) From a real estate professional’s point of view, what’s the purpose of qualifying buyers?
72) What’s the best way to respond when your buyer’s offer is accepted verbally?
73) –
74) When drafting a sales contract, how should a licensee handle areas that don’t pertain to the current transaction?
75) Last week, The Rialdis’ listing agreement ended after months on the market and not even a single offer to show for it. Today, they received a call from Mindy, a real estate professional who would like to relist the property and has some new ideas for getting it sold. What approach is Mindy using to find listings?
76) Keeping an area dry and keeping the air circulating can ______.
77) In order to avoid wire fraud, always contact the closing officer in order to ______.
78) Karissa is financing her home through a lender and is offering no money as a down payment. What type of loan is she most likely using?
79) When a listing agreement is signed, the two parties who enter into the agreement together are ______.
80) Properly pricing a property that is entering the market will ______.
81) Marissa, a buyer, asks you what she can do to prepare to buy. What should you tell her?
82) A licensee may accept compensation from ______.
83) If buyers see evidence of a pest infestation, they should always inquire with the seller to see if there is ______ on the property.
84) Rick represents Jules, a seller, who wants to know if he has to disclose his leaking roof to buyers. Rick says yes, since the problem constitutes _______.
85) When an investor receives title to a property—often by using a straw buyer—doesn’t make the mortgage payments, and rents out the home until foreclosure occurs, the investor is committing a type of mortgage fraud known as ______.
86) What is an initial cap, as it relates to an adjustable rate mortgage?
a. The number of percentage points that are added to the index to determine the rate
b. The value that limits the amount that interest can adjust at the mortgage’s first interest rate adjustment
c. The value that limits the amount the rate can adjust at subsequent adjustment dates
d. The value that limits the amount the rate can adjust over the life of the loan

87) Licensees must always be paid by their brokers, unless ________.
a. The broker authorizes otherwise in writing
b. The commission is less than $1,000
c. The payment is from a nonprofit organization
d. The payment will be deposited into a corporate account

88) Fiona and her husband, Ed, have just entered into their first-ever agency agreement with their new agent, Ken. The couple is a little nervous, but they like the idea that they have something in writing that explains both their agent’s responsibilities and what they’re expected to do as part of the relationship agreement. Life is good. What type of agency exists between Ken and his clients?
a. Implied agency
b. Oral express agency
c. Undocumented agency
d. Written express agency

89) Wayne conveys a property to Robbie until Robbie’s death, when the property is conveyed to Tiffany. What is this scenario an example of?
a. Fee simple estate
b. Homestead
c. Leasehold estate
d. Life estate

90) Which type of mortgage has a payment that adjusts (usually upward) based on a predetermined schedule and amount?
a. Amortized
b. Blanket
c. Bridge
d. Graduated payment

91) What occurs when one or both parties don’t meet all terms of the contract?
a. Impossibility of performance
b. Partial performance
c. Performance of a contract
d. Specific performance

92) When a buyer and seller enter into an agreement to transfer ownership of property, what type of contract will be used to complete the transaction?
a. Buyer agency agreement
b. Listing agreement
c. Option agreement
d. Sales contract

93) A borrower makes the same monthly mortgage payment for the entire term of the loan. At the end of the loan period, all of the interest and principal is paid off. This is known as a ______ loan.
a. Fully amortized
b. Growing equity
c. Negative amortization
d. Reverse annuity

94) Sheila and Vickie are sisters who enter into a contract to buy a vacation property. The sisters get into a dispute, and Vickie no longer wants any part of the deal. However, Sheila talks her younger brother Joe into replacing Vickie on the contract. Vickie agrees to the substitution. This is an example of ________.
a. Assignment
b. Fraud
c. Mutual mistake
d. Novation

95) Buyer Josephine had just signed a contract on a house when she discovered that seller’s agent Franklin knew that this house was 3500 square feet, but he listed it at 3900 square feet. Which essential contract element has been compromised?
a. Consent
b. Consideration
c. Legal purpose
d. Offer and acceptance

96) An acre of land costs $15,000. Jerry would like to purchase four acres. How much will this cost?
a. $100,000
b. $15,000
c. $3,750
d. $60,000

97) Janice’s life tenant, Jacob, is currently living on her property. Once Jacob dies, Janice has made arrangements that the property will go to the School for the Gifted. What interest does the School for the Gifted currently have?
a. Ownership
b. Possession
c. Remainder
d. Reversionary

98) ______ is the legal concept of property ownership.
a. Certificate of occupancy
b. Deed
c. Title
d. Will

99) Burt is an unrepresented buyer of Sima’s home. Sima’s listing agent is Aubrey. Who’s the client in this transaction?
a. Burt
b. Burt and Aubrey
c. Burt and Sima
d. Sima

100) Assume you’re entering into an agreement with a client to help him look for a property to call his own. What type of contract will you use to identify your agency relationship’s terms?
a. Buyer agency agreement
b. Option agreement
c. Purchase contract
d. Sales contract

101) A(n) ________ is a set of guidelines for ethical conduct.
a. Code of ethics
b. Contract
c. Option
d. Rule book

102) Shawn has agreed to pay $275,000 for his new home, with a $30,000 earnest money deposit. His bank is loaning him 80% of the appraised value of $350,000. In addition, the settlement costs he’s required to pay amount to 6% of the purchase price. If you wanted to calculate how much additional money Shawn needs to bring to closing, which of these would be a good place to start?
a. Calculate 5% of $295,000.
b. Calculate the difference between purchase price and settlement costs.
c. Calculate the loan amount that Shawn will receive from the bank.
d. Figure out why Trish’s agent doesn’t renegotiate the purchase price based on the appraised value.

103) Which of the following is an example of a limited agent?
a. Attorney
b. Escrow officer
c. Facilitator
d. Transactional broker.

104) Who’s responsible for conducting the closing meeting?
a. The broker
b. The buyer
c. The closing agent
d. The seller

105) What’s a brownfield?
a. An abandoned or unused commercial or industrial site with suspected contaminants
b. A partially restored residential area
c. A special use landfill
d. A wild space saved from development

106) Which of the following actions does the secondary mortgage market commonly take?
a. Issues loans to consumers.
b. Purchases loans from lending institutions.
c. Regulates lending institutions.
d. Sets interest rates.

107) What is the legal effect on the purchase agreement if an attached contingency is rejected or not met?
a. The agreement has to be renegotiated.
b. The contract is voidable.
c. The party who failed to meet the contingency must pay a fine.
d. The party who rejected the contingency must offer an alternative.

108) What type of agency exists because of the actions and behavior of the parties?
a. Action agency
b. Behavioral agency
c. Express agency
d. Implied agency

109) As part of the license application, prospective appraisers must submit ________.
a. A fingerprint card
b. An employment bond
c. Performance reviews
d. Physical exam results

110) Along with your two siblings, you have a one-third interest in your childhood home. You’ve all decided to put the house on the market and you’ll serve as the listing agent. What must you disclose to parties to the sale?
a. Nothing, since you own less than 50%
b. That the house is an estate with its owner in a nursing home
c. That you have a financial interest in the house
d. That your siblings will take much less than the list price

111) A subdivision that includes space for offices, shopping centers, movie theaters, and apartment buildings is an example of a _________________.
a. Converted-use development
b. Cooperative
c. Mixed-use development
d. Planned unit development

112) Shawn specializes in the sale of retail stores and shopping centers. What types of properties are these?
a. Commercial
b. Industrial
c. Residential
d. Special purpose

113) Which of the following items go into the seller’s credit column and the buyer’s debit column?
a. Credits
b. Debits
c. Prepaids
d. Prorations

114) Which of the following are addressed by the Subdivided Land Act?
a. Development requirements
b. Financing requirements
c. Labor requirements
d. Reporting requirements
115) Which term refers to the ordinances/regulations that protect the community and control property development within subdivisions?
a. Environmental impact statement
b. Plat book
c. Subdivision plat
d. Subdivision regulations

116) Which of the following statements about restrictive covenants is true?
a. They are permanent and follow the land forever.
b. They are temporary and have a specific time limit.
c. They may run with the land forever, or they may have a time limit.
d. They must last at least 30 years.

117) Donna rents an apartment in a building that’s being converted to condominiums. By law, the owner of the building must give Donna ________.
a. 10 days’ notice before evicting her
b. The option to buy her unit or continue as a tenant for a specified period of time
c. The option to buy the unit at a reduced price
d. The option to continue renting the unit at a reduced rate

118) Marvin purchased the right to use a resort unit for two weeks every year, although he doesn’t own the property itself. What kind of timeshare is this?
a. Divided timeshare
b. Right-to-use timeshare
c. Timeshare estate
d. Timeshare in perpetuity

119) Which option best defines voluntary alienation?
a. A person dies without a will.
b. A property is taken from a property owner due to failure to pay real property taxes.
c. A property owner intentionally transfers property to another.
d. Someone takes possession of another’s property by adding a previous claim to their own.

120) In how many states is undisclosed dual agency legal?
a. 18
b. 38
c. All 50
d. Zero

121) What is a lifetime cap, as it relates to an adjustable rate mortgage?
a. The number of percentage points that are added to the index to determine the rate
b. The value that limits the amount that interest can adjust at the mortgage’s first interest rate adjustment
c. The value that limits the amount the rate can adjust at subsequent adjustment dates
d. The value that limits the amount the rate can adjust over the life of the loan

122) Which document is provided to borrowers no fewer than three days prior to closing and provides details about the costs of the transaction?
a. Closing Disclosure
b. Escrow Closing Notice
c. Loan Estimate
d. Mortgage Servicing Transfer Disclosure

123) What is typically used to prove there are no encroachments on the property?
a. Abstract of title
b. Chain of title
c. Deed
d. Survey

124) Which of the following is a right included with real property?
a. Contamination
b. Encroachment
c. Exclusion
d. Hazardous acts

125) Sue, the seller, and Carl, the buyer, are preparing to close on their transaction. Who is responsible for reviewing the settlement statement before closing?
a. Carl only
b. Sue and Carl
c. Sue only
d. Sue’s and Carl’s attorneys

126) How do predatory lenders take advantage of consumers?
a. Making loans to consumers who can’t afford them
b. Not selling their loans on the secondary market
c. Selling their loans on the secondary market
d. Underwriting loans

127) Dominique purchased a timeshare that conveys the right to occupy the property for two weeks each year, continuing for 20 years. However, the timeshare does not convey ownership. This is an example of a ______ timeshare.
a. Estate for life
b. Fee simple ownership
c. Renewable
d. Right-to-use

128) Only brokers may do which of the following?
a. Conduct brokerage activities
b. Hold open houses
c. Receive compensation directly form buyers or sellers
d. Work directly with buyers and sellers

129) Which essential element of a deed contains the words, “does hereby bargain, grant, deed, and convey?”
a. Acknowledgment
b. Conveyance
c. Delivery and acceptance
d. Recording

130) What does procuring cause refer to?
a. A condition that must be met in order for a contract to be legally binding
b. An uninterrupted series of events that results in a successful transaction
c. Compensation for loss, damage, or injury caused
d. Failure to perform an act agreed upon by all parties

131) If Elizabeth is a property manager, she is acting as what of type of agent?
a. Dual
b. General
c. Special/specific
d. Unlicensed

132) Which of these describes a deed?
a. Abstract of title
b. Ownership document
c. Promissory note
d. Recording fee

133) What happens to a joint tenant’s share of property when the joint tenant dies?
a. The joint tenant’s interest goes to the remaining joint tenants. If only one joint tenant is left, that joint tenant owns the property in severalty.
b. The property must be sold, with the proceeds from the joint tenant’s share distributed to heirs.
c. The tenancy remains, but the joint tenant’s interest passes to heirs.
d. The tenancy terminates, and the joint tenant’s share goes to the state.

134) Which of the following statements about covenants is true?
a. A bargain and sale deed will always come with covenants of warranty.
b. Every conveyance comes with a fully warrantied title.
c. The full covenant and warranty deed contains the strongest and broadest form of guarantee of title.
d. The “full covenant” typically means three covenants are included.

135) Which of the following opinions can a real estate licensee provide?
a. An opinion regarding the appraisal value of a property
b. An opinion regarding the effect of breaking an existing agreement to accept a new offer
c. An opinion regarding the listing price
d. An opinion regarding whether a roof needs to be replaced

136) A dwelling is in untenantable if it substantially lacks
a. A heating unit

137) Transfer of all of a tenant’s rights under a lease is
a. An Assignment

138) If a landlord wants to increase the rent on a unit that is regulated by the Tenant Protection Act of 2019, what’s the maximum allowed as an annual increase?
a. 5% plus the cost of living
139) Malcolm loves his apartment, even though he’s rarely there. His job in international development has him on the road for months at a time. He doesn’t have to worry about missing out on his lease renewal though, because he has a(n) _____________
a. Periodic Estate
140) Eric’s residential tenant hasn’t paid rent for more than three months, and so Eric went to court to start eviction proceedings. He’s now been granted the right to remove the tenant. This is a(n) _________________ eviction.
a. Actual
141) A security deposit on furnished residential property can be no more than
a. 3 month’s rent
142) A retail business has a percentage lease based on 5% of gross income of up to $25,000 per month and 2 1/2% of gross income above that amount. The minimum to be paid is $1,000 per month. For a month in which the business has a gross income of $47,000, what will be the rent payment?
a. $1,800
143) The owner of 417 Main, an office building, receives a guaranteed monthly income from her tenants and pays no expenses. She has
a. A Net Lease
144) Which of these landlords had filed an unlawful detainer suit?
a. Chet tried to kick his tenant out, but he would not leave, so he’s started eviction proceedings.

145) A landlord has a right of entry
a. In an Emergency
146) Buyer Penelope adores the house at 212 Maple Street, but two weeks after making her offer, she’s discovered it’s got some issues that weren’t identified on the state-required seller disclosure form. She still wants to buy the house. Since the seller appears to have lied on the disclosure form, what can Penelope do?
a. Ask the seller to make the repairs needed, or ask for a credit to cover the cost of those repairs.
b. Because the seller lied on the disclosure forms, the purchase contract is invalidated, so Penelope must make a new offer.
c. Complete the transaction, then sue the seller for fraud.
d. Reduce the amount of her offer
147) Jose, who is 16, entered into a contract to sell a condo he owned. Because Jose is a minor, ______.
a. Either Jose or the buyer may void the contract due to Jose’s minority
b. It makes no difference; if he signed the agreement, he must abide by it
c. Only Jose may void the contract
d. The contract is void
148) Which of these is a system that many states use to determine lien priority?
a. First in time, first in right
b. Government payments come last
c. Largest lien has first priority
d. Mortgage liens before judgment liens
149) What’s the definition of a land contract?
a. Buyers purchase a piece of undeveloped land.
b. Land owners divide their land into parcels.
c. Property owners lease their land to someone else, who develops the property.
d. Sellers provide funds or credit to buyers in order to close the transaction.
150) Where is a complaint against a licensee filed?
a. On the Real Estate Commission’s Web site.
b. With a co-worker of the licensee
c. With the licensee themselves
d. With the supervising brokerage
151) Which of the following is true about condominium ownership?
a. A condo is a multi-family dwelling.
b. A condo is a single-family dwelling.
c. It involves proprietary leases.
d. There is a large yard to maintain.
152) What’s a subordination agreement?
a. It’s a document that’s produced by the court during bankruptcy trials that states the order of payment for creditors.
b. It’s an agreement that a previous lender signed allowing a later lender to take over the primary, or first, loan position.
c. It’s an agreement that borrowers sign to determine the order or priority for lien holders against their property.
d. It’s an agreement the lender signs saying it will provide title to the property to the borrower when the loan is paid off.
153) Which act gives companies the right to sue a competitor for making deceptive ad claims?
a. The Gramm-Bliley Act
b. The Lanham Act
c. The Privacy Act
d. The Truth in Advertising Act

154) What’s a benchmark?
a. A permanent reference point for marking datums
b. The beginning point for lot and block surveys
c. The beginning point for metes and bounds surveys
d. The beginning point for rectangular surveys
155) You have clients who are interested in purchasing a property in a floodplain. As their agent, what do you want to ensure they are aware of?
a. That resale will be difficult because the home is in a floodplain.
b. The client will not need flood insurance.
c. The house most definitely has the potential for some kind of flood damage in the next 100 years.
d. Their lender may require flood insurance, which may affect the affordability of the home.
156) What type of ground lease allows a tenant to buy out the lease?
a. Conceivable
b. Irretrievable
c. Redeemable
d. Retrievable
157) Lenders will require which type of fund for taxes and insurance?
a. Balloon fund
b. Emergency fund
c. Mortgage fund
d. Reserve fund
158) In order for you to earn compensation for brokerage activities, you must be employed as the agent of the client. How is this employment accomplished?
a. The client must be a buyer.
b. The client must make an express agreement to pay a commission to your broker.
c. You must be employed by a broker.
d. You must express an interest in representing the client.
159) A broker’s price opinion is generally written by ______.
a. A buyer
b. An appraiser
c. A real estate broker for a buyer
d. A real estate broker for a lender
160) In states without full disclosure requirements, whose responsibility is it to review disclosures, ask questions, and obtain a home inspection?
a. Buyer
b. Licensee representing the buyer
c. Licensee representing the seller
d. Seller
161) A good way for real estate licensees to prevent problems at the closing is to ____________.
a. Check up on the other party in the transaction so they don’t forget anything
b. Communicate frequently with your client and make sure they know what to do
c. Show up early
d. Work only with a known, trusted settlement officer

162) Whose responsibility is it to keep track of all buyer contingency deadlines and ensure they’re not missed?
a. The buyer
b. The buyer and the buyer’s agent
c. The seller
d. The seller and the seller’s agent
163) Which term refers to a permitted deviation from current zoning restrictions that allows an owner to use land for a purpose that’s otherwise prohibited, and requires the owner to prove the zoning creates an unnecessary hardship?
a. Moratorium
b. Property variance
c. Special use permit
d. Use variance
164) Assigning a lower-density use zone to an area that previously allowed higher density and that may reduce property values is known as ______.
a. `Bulk zoning
b. Density-reduction zoning
c. Downzoning
d. Reduction zoning
165) Mortgage lenders will ___________
a. Not use the FICO® score, only their personal judgment
b. Only use the FICO® score to determine creditworthiness of the applicant
c. Sometimes extend credit, even when a FICO® score is low
d. Weigh poor credit from the past the most heavily, even if FICO® scores have improved
166) The location of wetlands and springs at a development site is part of ______.
a. Development cost
b. Development impact
c. TDR
d. Topography
167) Which loan type is a fixed-rate mortgage where the monthly payments increase over time, according to a set schedule?
a. Blanket
b. Growing equity
c. Negative amortization
d. Pledged account
168) Octogenarians Gertie and Frank met in Sunset Living, a skilled nursing center for people with advanced Alzheimer’s disease, where they’re both residents. They fell in love and get hitched, signing a marriage certificate. This is an example of a(n) ______ contract.
a. Executory
b. Implied
c. Invalid
d. Valid

169) What’s a foreclosure?
a. A property sale that occurs in less than one week
b. A sale that fails to receive a high enough bid at auction and then falls to the bank’s ownership
c. The forced sale of a property due to the borrower defaulting on the mortgage loan
d. The sale of a property when the market value of the home is less than what is owed, plus closing costs

170) _______ can be defined as everything that’s not real property.
a. Land property
b. Personal property
c. Private property
d. Real estate

171) Which of the following items must be included in the security instrument used for a real estate transaction?

a. Borrower credit report
b. Legal description of the property
c. Lender disclosures
d. Title insurance abstract

172) Which of the following statements best describes a mortgage broker?
a. An institution that focuses on commercial lending
b. An institution that specializes in taking in savings deposits then lends money out as loans and mortgages
c. A person who works for a specific lender and can offer products from that particular institution
d. A person who works with multiple lenders to find the product that works best for the client

173) Appraiser Niles uses ______ to determine a range of values based on comparing a subject property to comparable sales. He makes sure to use some comparables that lack features of his subject property, and others that have even more desirable features, to balance out the comparison.
a. Bracketing
b. Competition
c. Correlation
d. Substituting

174) At what point in a residential transaction must a seller’s agent deliver a completed Residential Real Property Disclosure Report to a buyer?
a. At least five days prior to closing
b. Prior to showing the property to the prospective buyer
c. Prior to the parties signing a purchase agreement
d. Within three days after the parties sign a purchase agreement

175) Which of the following is a residential dwelling with attached walls, where the owneralso typically owns the land on which the home sits?

a. Apartment
b. Condominium
c. Single-family detached home
d. Townhome

176) A ______ is the expected rate of return on an investment.
a. Capitalization rate
b. Cash flow
c. Income ratio
d. Profit margin

177) Carolyn is representing John in the sale of his home. Which listing agreement clause gives her additional authority and obligates her to distribute the listing to other brokers?
a. Broadcast clause
b. Broker extension clause
c. Marketability clause
d. Multiple listing clause

178) _______ are artificial attachments to land that include items such as fencing, buildings, and walkways.
a. Emblements
b. Encroachments
c. Improvements
d. Levies

179) Violators of the Sherman Antitrust Act may be subject to fines. For what amount may corporations and individuals be liable?
a. Up to $100,000 for corporations and $1,000 for individuals
b. Up to $100 million for corporations and $1 million for individuals
c. Up to $10 million for corporations and $1 million for individuals
d. Up to $1 million for corporations and $100,000 for individuals

180) You helped Frasier buy his penthouse condo. He’s just received the keys and you two have said your goodbyes after closing, and you’re heading back to the office to close out the transaction file. Which of your fiduciary duties continue?
a. Accounting and loyalty
b. Confidentiality and accounting
c. Confidentiality, loyalty, and accounting
d. Reasonable skill and care, confidentiality, and loyalty

181) When licensee Linda asks potential seller clients about their reasons for selling, what’s her purpose?
a. To create a data set about typical seller characteristics
b. To develop a rapport with the customer
c. To help her determine a suggested listing price
d. To help her gauge the seller’s motivation as part of her qualifying process

182) In the conveyance of real property after death, what trumps any terms specified in the deceased person’s will?
a. Heirs’ wishes
b. Intestate
c. Nothing
d. Operation of law

183) Which agency duties survive termination of an agreement?
a. Accounting and loyalty
b. Confidentiality and accounting
c. Confidentiality, loyalty, and accounting
d. Reasonable skill and care, confidentiality, and loyalty

184) With regard to contingencies, what responsibility does licensee Wanda have when representing buyers?
a. She should avoid contingencies altogether because they tend to put sellers off.
b. She should maximize the number of contingencies used to avoid being sued.
c. She should use a standard set of contingencies with each buyer.
d. She should use contingencies judiciously to protect her clients and the deal.

185) With which approach to value does the appraiser analyze a property’s ability to earn future income?
a. Cost approach
b. Income approach
c. Sales comparison approach
d. Taxable revenue approach

186) Which federal lending act was introduced to combat lending discrimination in low- and moderate-income neighborhoods?
a. Community Reinvestment Act
b. Consumer Credit Protection Act
c. Equal Credit Opportunity Act
d. Home Mortgage Disclosure Act

187) How large is an acre?
a. 10,000 square meters
b. 43,560 feet
c. 43,560 square feet
d. 5,480 square feet

188) Federal fair housing laws prohibit ______.
a. A 49-year-old, single woman from describing herself as such in an advertisement for a roommate
b. An ad stating families with small children need not apply
c. Evicting a tenant who sells drugs from the property
d. Refusing to rent a property to smokers

189) In a life estate, all of the following apply during the term except ______.
a. Control
b. Ownership
c. Possession
d. Transferability

190) Zoning regulations must be aligned with an area’s ______.
a. Comprehensive plan
b. Government plan
c. Majority opinions
d. Political jurisdictions

191) The courts use three primary tests to determine whether something is personal property or real property. What are the names of the three tests?
a. Method of attachment, acknowledgement and adaptation
b. Method of attachment, agreement, and accessory
c. Method of attachment, agreement, and adaptation
d. Method of reimbursement, agreement, and adaptation

192) Why is it important for a buyer to know if an underground storage tank is present on a property?
a. Buyers don’t need to know.
b. Older tanks may leak and contaminate the ground.
c. The buyer may want to use the tank.
d. The buyer will need to check if the tank is correctly sized.

193) Which of the following is appropriate to include in a buyer agency agreement?
a. A list of duties the agent owes to the buyer
b. An automatic renewal clause
c. The buyer’s age and number of children
d. The buyer’s preference for ethnic ratio of a neighborhood

194) Tim, a new buyer client, is pre-approved for a mortgage loan of as much as $250,000. This information can help to _______.
a. Identify properties
b. Inspect a property he has identified
c. Research a property he is interested in
d. Show him properties

195) It’s not a good idea to post photos of your clients’ expensive belongings. Why is that?
a. It can attract the attention of thieves.
b. It will decrease the market value of the property.
c. It will discourage criminals.
d. It will make the property less attractive to potential buyers.

196) Broker Alex learns that his friend Joann is frustrated with the broker who listed her home. Alex encourages her to break her existing agency agreement and sign with him instead. This violation is an example of ______.
a. Contractual interference
b. Failure to disclose an agency relationship
c. Making a substantial and willful misrepresentation
d. Performing services that would qualify as practice of law

197) Which document provides an estimate of the costs a buyer is likely to pay at settlement?
a. Closing Disclosure
b. HUD-1 statement
c. Loan Estimate
d. Mortgage Servicing Transfer Disclosure

198) Bob and Mary are financing $80,500 for a new home. Their lender will approve an interest rate of 6.5% if Bob and Mary pay three-and-a-half discount points at closing. How much is this?
a. $2,415
b. $2,817.50
c. $5,232.50
d. $8,050

199) What’s the purpose of a short sale?
a. To avoid foreclosure
b. To avoid responsibility for taking the traditional route to selling property
c. To replenish the local real estate market with fresh properties in a short amount of time
d. To sell the property quickly when the real estate market is booming

200) Wyatt is selling his home to Kirk, and promises in writing to have a licensed professional repair the home’s leaky roof. After closing, Kirk, who financed the purchase, discovers that Wyatt patched the roof poorly and it leaks whenever it rains heavily. Under the Illinois statute of limitations, if Kirk wishes to sue Wyatt, he must do so within ________ of the contract breach.
a. 10 years
b. Five years
c. Three years
d. Two years

201) The Lanham Act gives companies the right to ______.
a. A trial by jury
b. Make misleading advertising claims less than 10% of the time, which is known as the Lanham Percentage Right
c. Pursue clients by whatever means possible
d. Sue competitors that are using deceptive claims in ads

202) The power of the state to claim property when the owner dies without a will and without locatable heirs or creditors is also known as ______.
a. Eminent domain
b. Escheat
c. Life estate
d. Taking

203) Agents owe fiduciary duties to their clients. Among these are loyalty, reasonable skill and care, confidentiality, accounting, and disclosure. Which fiduciary duty is missing from this list?
a. Kindness
b. Obedience
c. Profitability
d. Strategy

204) George just applied for a conventional loan on a cottage he wants to buy. What percentage of the loan can he expect to submit as a down payment?
a. 0%
b. 20%
c. 25%
d. 5%

205) Which of the following best describes what an appraisal is?
a. It’s a broker price opinion.
b. It’s a comparative market analysis.
c. It’s an assessment of market value.
d. It’s an opinion of value.

206) Which of these is a recommended best practice after any discussion between a licensee and a client or other party involved in a transaction?
a. Allow no more than 48 hours to pass without additional contact.
b. Enter notes about the discussion in the property’s listing in the MLS.
c. Send a follow-up email to create a written record of the discussion.
d. Send a hand-written thank you note.

207) How do licensees use the funnel?
a. To calculate the number of homes sold in an area that the licensee may be able to list
b. To calculate the number of leads required to generate a certain amount of income
c. To calculate the number of transactions to close each year to reach a certain amount of income
d. To sift through leads to find the clients worth spending time on

208) Your clients, the Meltons, found their dream home, which they will be financing with ABC Lending. What should they include with their offer?
a. A letter describing their family’s lineage
b. A loan commitment
c. A pre-approval letter from ABC Lending
d. Cash (no checks)

209) In which of the following situations is it legal to receive compensation?
a. You help a neighbor buy a foreclosed home, and in addition to your commission, your neighbor pays your rent for that month.
b. You help your aunt sell her house as a for sale by owner, and she gives you a $5,000 savings bond.
c. You refer a client to your favorite mortgage broker, who gives you 10% of the money earned.
d. You refer a client to your sister, who works at another real estate agency. When she gets her commission check, she sends you a thank you note.

210) Dominic’s seller clients want him to lower his commission rate. What’s the best way for him to reply?
a. “I base my fees on my services. Which services would you like to give up?”
b. “No way!”
c. “Sure!”
d. “This is the standard rate in this market.”

211) Whose consent and agreement are required to conduct a short sale?
a. The buyer’s attorney’s
b. The court’s
c. The lien holder’s
d. The seller’s attorney’s

212) Bart and Claire are under contract for Claire to buy Bart’s house, but her financing fell through. They decide to cancel the contract just as if it never happened. Which termination method does this describe?
a. Reformation
b. Release
c. Rescission
d. Restraint

213) Which of these photo descriptions may be a potential MLS violation?
a. A photo of the master bedroom, including the bed, dresser, and jewelry armoire
b. Multiple exterior photos, taken in different seasons
c. Photos taken after a professional cleaning service and stager spruced it up
d. Wide-angle photos of the recently updated bathrooms and kitchen

214) The ______ provides buyers with an approximation of the costs they’re likely to pay at settlement.
a. Closing Disclosure
b. HUD-1 statement
c. Loan Estimate
d. Mortgage Servicing Transfer Disclosure

215) Which of the following activities occurs before closing?
a. The buyer and lender close on the mortgage loan commitment.
b. The buyer obtains an insurance binder.
c. The seller and buyer agents close on their cooperative brokerage agreement.
d. The seller is paid the balance of the purchase price.

216) _________ occurs when the parties meet all terms of the contract.
a. Impossibility of performance
b. Partial performance
c. Performance of contract
d. Specific performance

217) Under what circumstances may a seller legally terminate an exclusive right-to-sell listing agreement before its listing term has passed?
a. If the listing broker agrees in writing to the termination
b. If the seller has found a ready, willing, and able buyer with no assistance from the listing broker
c. If the seller loses his job
d. Under no circumstances

218) When an ______ is added to a sales contract, it changes the original terms of the contract.
a. Addendum
b. Amendment
c. Annexation
d. Appurtenance

219) For a deed to be valid, which two elements are required?
a. Habendum clause and habeus corpus clause
b. Signature of the grantee and habendum clause
c. Signature of the grantor and habendum clause
d. Signatures of the grantee and grantor

220) Agreeing to a specific price, price range, or minimum or maximum charges among competing firms is an example of which type of antitrust violation?
a. Group boycotting
b. Market allocation
c. Price fixing
d. Tie-in arrangement

221) After signing a purchase contract, buyer Pam and seller Waylon both realize that the address for Pam’s newly-purchased home reads “344 Beverly Way” instead of the correct address: “334 Beverly Way.” Which of the following is true about this situation?

a. Pam has clear evidence that Waylon tried to trick her.
b. Pam or Waylon can void this contract and present a new one with the correct address.
c. The contract is invalid because there is no offer and acceptance.
d. This is definitely a case of fraud.

222) What’s the difference between an exclusive right-to-sell and an exclusive agency agreement?
a. No commission is earned if the seller locates the buyer with exclusive agency.
b. No permission is required for dual agency with an exclusive right to sell.
c. One is for buyers, and one is for sellers.
d. They are two names for the same thing (no difference).

223) Sanjiv recently signed a brokerage agreement with a landlord client. To be considered a valid contract in Illinois, the agreement must have either a provision for the client’s right to terminate annually with a 30-day written notice or ______________________.
a. A firm expiration date
b. An automatic renewal clause
c. An option to renew clause
d. A right to early termination waiver

224) Jamilynn violated antitrust law by engaging in price fixing. Which of these actions did she most likely perform?
a. She agreed with licensees from other brokerages not to engage in business with licensees from a certain firm.
b. She followed her brokerage’s pricing policy.
c. She sets her commission based on the services she performs.
d. She told a consumer the commission rate is standard for the industry.

225) What are the three most common forms of legal descriptions?
a. Lot and block, rectangular government survey, and monument
b. Metes and bounds, lot and block, and plat map
c. Metes and bounds, lot and block, and point of beginning
d. Metes and bounds, lot and block, and rectangular government survey

226) What type of loan may be used if the buyer is obtaining seller financing?
a. Graduated payment mortgage
b. Pledged account mortgage
c. Purchase money mortgage
d. Wrap-around mortgage

227) Nina signed an exclusive buyer agency agreement with Ken, her client. Ken buys a property from another agent. What might happen?
a. Ken may owe commission to Nina.
b. Ken may void the transaction.
c. Nina may void the transaction.
d. Nothing; buyers are free to work with whomever they choose.

228) The zoning ordinances changed 10 years after Stan built his home, and it was grandfathered into the current zoning through nonconforming use. Now Stan is selling the home. Which of the following is true regarding the new owners’ responsibilities to comply with zoning regulations?
a. They’ll have to apply for new zoning.
b. They’ll have to comply with the current zoning.
c. They’ll have to get an area variance.
d. They’re able to continue nonconforming use.

229) This statement is part of a promissory note attached to a security instrument: “I have the right to make payments of Principal at any time before they are due.” What’s the name of the clause where this statement is included?
a. Lock-in clause
b. Penalty clause
c. Pre-payment clause
d. Principal clause

230) If a buyer you represent waives the inspection, what should you do?
a. Congratulate yourself—this is going to be an easy deal
b. Get the waiver in writing
c. Hire an inspector anyway
d. Perform it yourself

231) Blake recently negotiated a net lease for space in an office building he owns. Under a net lease, the tenant pays ________.
a. All of the property expenses
b. All of the property taxes
c. A portion of the property expenses
d. No rent

232) Which laws does the Office of Fair Housing and Equal Opportunity uphold?
a. Civil rights laws
b. Equal opportunity laws
c. Federal fair housing laws
d. The Fair Housing and Equal Opportunity Act

233) What was the estimated cost of improvements?
a. value = site value improvement cost – depreciation
b. or
c. improvement cost = value -site value depreciation

234) Which of the following measurement systems is mostly used in states that were part of the original 13 colonies?
a. Compass and ruler
b. Lot and block
c. Metes and bounds
d. RGSS

235) You have found the perfect home for Lucy and she is ready to make an offer. The home was built in 1938. Who is responsible for scheduling paying for the home’s lead inspection?
a. The buyer
b. The listing agent
c. The mortgage company
d. The seller

236) Which of the following is a true statement about options and option fees?
a. An option fee may be for any amount agreed to by the parties.
b. Neither party is obligated to perform with an option.
c. Once the option fee is paid, both parties are obligated to exercise the option.
d. The option is a bilateral contract.

237) The state claimed Sophia’s home under eminent domain. It appraised her property and offered to pay Sophia the appraised value for the home. What’s this process called?
a. Condemnation
b. Inverse condemnation
c. Inverse taking
d. Regulatory taking

238) ______ is when one party didn’t meet the terms of the contract in the specified timeframe, and is now being required to do exactly what was agreed to in the contract.
a. Impossibility of performance
b. Partial performance
c. Performance of a contract
d. Specific performance

239) Jay’s new loan to purchase a property includes the seller’s existing mortgage. What type of loan is this?
a. Blanket
b. Package
c. Unsecured
d. Wraparound

240) What are PCBs?
a. A chemical compound that occurs naturally in the environment
b. A substance resulting from the decay of uranium
c. A substance that grows due to moisture problems
d. Chemical compounds used in cooling and insulating, mainly in electrical transformers

241) Which term is used to define a search of public records going back at least 60 years to establish a property’s title history?
a. Correction deed
b. Limited search
c. Title examination
d. Title report

242) Which of the following describes the appropriate capital gains exclusion for a taxpayer’s primary residence?
a. The taxpayer lived in the home at least five of the seven years immediately preceding the sale, with an exclusion of up to $125,000 for single taxpayers, $250,000 for couples filing jointly.
b. The taxpayer lived in the home at least five of the seven years immediately preceding the sale, with an exclusion of up to $250,000 for single taxpayers, $500,000 for couples filing jointly.
c. The taxpayer lived in the home at least two of the five years immediately preceding the sale, with an exclusion of up to $125,000 for single taxpayers, $250,000 for couples filing jointly.
d. The taxpayer lived in the home at least two of the five years immediately preceding the sale, with an exclusion of up to $250,000 for single taxpayers, $500,000 for couples filing jointly.

243) When is a transfer tax payable?
a. During the title search
b. When passing property from parent to child or between siblings
c. When the deed is recorded
d. When there is an equitable distribution between divorced spouses

244) A buyer can submit the earnest money deposit in the form of __________.
a. A personal check
b. A postdated check
c. A promissory note
d. Verbal assurance

245) Licensees’ ethical duties to the public include not naming false consideration, _________________________, and completing paperwork accurately.
a. Memorizing the Code of Ethics
b. Sharing confidential information
c. Staying informed about real estate issues
d. Taking twice as many continuing education courses as required

246) The cost approach to finding an appraised value measures ______.
a. The cost to acquire a property only
b. The cost to acquire land and construct a reproduction
c. The cost to construct a reproduction only
d. The expenses the property is expected to produce for the owner

247) Wendell is a first-time home buyer who needs to take out a loan to help finance his purchase. What is the first thing Wendell must do once the seller has accepted his offer and the contract has been finalized?
a. Check his credit score
b. Pay off all his credit cards
c. Request that the settlement date be delayed by 30 days
d. Submit a written application for financing

248) What is the highest penalty an unlicensed individual practicing real estate may be fined for more than two offenses?
a. $10,000 per violation
b. $1,000 per violation
c. $25,000 per violation
d. $2,500 per violation

249) Which of the following is an example of a development cost?
a. Crime rates
b. Increased demand on infrastructure
c. Lower unemployment
d. School ratings

250) Which of the following items is something a lender is prohibited from doing if the lender wants to write qualified mortgages?
a. Amortization
b. Balloon interest
c. Debt-to-income ratios less than 43%.
d. Payback terms longer than 30 years

251) The question, “What’s the purpose of this appraisal?” can be answered by which step of the appraisal process?
a. Determine highest and best use.
b. Estimate land value.
c. Identify data needed.
d. State the problem.

252) A valid deed must contain all of the essential elements, and ______.
a. It must be approved by the local judge
b. It must be in nuncupative form
c. It must be in writing
d. It must be sealed in an envelope and sent to all parties via registered mail

253) In order for an owner-occupant of a building with rental units to reject applicants based on sex, marital status, gender identity, and/or sexual orientation, they must not own more than how many rental units in a building?
a. Five
b. Four
c. Three
d. Two

254) How do discrimination testers work?
a. They hold focus groups and ask questions of attendees about fair housing.
b. They provide a 20-point questionnaire on discrimination and score it, with a passing score set at 70% or more.
c. They send a minority into a place offering housing to test how they’re treated.
d. They send two different applicants whose only difference is status within a protected class, and test whether the applicants are treated differently.

255) The VA guarantees _____ of the home loan amount.

256) Investors in commercial real estate often give up _________ when they purchase a new property.
257) A limited liability company combines some advantages of
258) There are many versions of property management agreements, although all management agreements should include
259) Soundproofing and decorative material, shingles and siding made before 1970 contain what hazardous material?
260) The listing agreement is a legally binding contract between __________________.

261) Rick, a builder, is getting a loan in which two properties are used for collateral. This is an example of a _______ loan.
262) Which one of the following is a buyer required to disclose in the Purchaser’s Representations section of the Regional Sales Contract?
263) What is a land contract?
264) What must occur to effect a transfer of title?
265) It’s very important that a buyer obtain a/an _________that shows that he has obtained homeowners fire and hazard insurance.
266) What is the depreciation schedule for a residential income-producing property?
267) Radon has natural origins and is a colorless, odorless, radioactive gas that’s released when ___________ decays.
268) A buyer can submit the earnest money deposit in the form of a check or __________
269) How many approaches do appraisers use when estimating a property’s value?
270) What regulation or regulatory authority identifies sites that have hazardous substances, and requires clean-up by the responsible parties?
271) What is a gaseous compound used in refrigeration cleaning solvents, Styrofoam, and aerosol propellants?
272) The definition, “The earth’s surface extending downward to the center and upward to infinity and including permanently attached natural objects,” describes ____________.
273) When possible, comparable sales from ______ should be used.
a. At least six other properties
b. Competing market areas
c. No more than 24 months ago
d. The same neighborhood

274) In relation to appraisals, what is a “federally related transaction”?
a. An appraisal that a federally licensed appraiser conducts
b. A real estate transaction in which a federal financial agency or regulatory authority is involved
c. A transaction involving the sale of government secrets
d. A transaction in which financing is obtained from foreign investors

275) Which type of REIT receives most of its revenue from rental of its properties?
a. Equity REIT
b. Leasehold REIT
c. Mortgage REIT
d. Tax-deferred REIT

276) The income approach to appraisal is based on which value principle?
a. Anticipation
b. Capitalization
c. Competition
d. Substitution

277) Ownership in a planned unit development consists of ______.
a. A house, but not the property it sits on
b. A house, the property it sits on, and shared ownership of commercial enterprises
c. A parcel of land and the structures on it
d. A parcel of land, the structures on it, and shared common areas

278) Land, plus all things permanently attached to it naturally or artificially, is ______.
a. Interest
b. Private property
c. Real estate
d. Real property

279) John is an investor who wants to find out how much his money could’ve earned if he’d put it into a different investment, which is known as the ______.
a. Capital recapture
b. Cost of capital
c. Return of investment
d. Return on investment

280) Archie wants to buy Claire’s membership share in a cooperative. Assuming he has submitted his application, which of the following statements is true?
a. Archie need not submit an application to the cooperative board.
b. At Claire’s request, the cooperative is obligated to approve Archie’s application.
c. Claire can sell her membership share to whomever she wants, regardless of what the cooperative board says.
d. The cooperative board must approve Archie’s application before Claire can sell her membership share to him.

281) Which of the following establishes requirements for property appraisals in order to protect home buyers who use a conventional loan?
a. Appraiser Independence Requirements
b. Building codes
c. Contract laws
d. TILA

282) A property is uninhabitable in its current state. What effect will its utility have on the value?
a. Utility doesn’t influence value.
b. Value will be pushed downward.
c. Value will be pushed upward.
d. Value will remain the same.

283) Lucille is estimating the property’s loss in value for both curable and incurable items of depreciation. Which method is Lucille using to measure depreciation?
a. Age-life
b. Capitalized Value
c. Market Extraction
d. Observed Condition

284) If an adjustment is needed for sales or financing concessions, when should an appraiser make this adjustment?
a. After adjusting for specific features
b. After adjusting for time
c. First, before adjusting anything else
d. Last, after adjusting for all other factors

285) Which part of the cost approach equation is considered the most difficult part to estimate accurately?
a. Accrued depreciation
b. Property value
c. Reproduction/replacement cost
d. Site value

286) Where in the Uniform Residential Appraisal Report would you find the number of total rooms, bedrooms, and bathrooms?
a. Improvements
b. Neighborhood
c. Sales comparisons
d. Site

287) Property that is free-standing and not attached to real estate is called ______.
a. Land property
b. Personal property
c. Real property
d. Vacant property

288) Which of the following is the presentation of the appraiser’s solution to the appraisal problem for a commercial property?
a. Financial report
b. Narrative report
c. Property value report
d. Subject property report

289) Real estate, plus all of the interests, benefits, and rights included in ownership, is also known as ______.
a. Estate
b. Land
c. Personal property
d. Real property

290) Which approach to finding value would licensed appraiser Christina probably weigh most heavily when appraising a three-unit rental property?
a. Cost
b. Income
c. Sales comparison
d. Substitution

291) What’s the name of a process that estimates future income and then applies a discount rate in order to provide an investment’s present value?
a. Direct capitalization
b. Discounting
c. Reversion capitalization
d. Yield capitalization

292) You’re touring your new seller clients’ property. While you visually assess the property and measure rooms, what else should you do?
a. Ask about the age of the appliances and roof, heat sources, and whether there have been any issues with moisture, pests, or any systems
b. Give them a ballpark range for a list price
c. Have them look over the seller’s disclosures
d. Offer staging advice for the rooms

293) Why should a listing agent include a seller net sheet with a comparative market analysis?
a. This is not a good strategy.
b. To bulk up the CMA with extra paperwork
c. To remind the sellers how much commission they will owe
d. To show the sellers what the current recommended list price will net them

294) Which of the following will an appraiser do first when using the sales comparison approach?
a. Compare properties to the subject property and adjust for differences.
b. Estimate a fair and current market value for the subject property.
c. Identify features of the subject property that are in demand in the market.
d. Select recently sold comparables that are substantially similar to the subject property.

295) What type of information might an appraiser find at the local chamber of commerce?
a. Comparable data
b. Construction cost data
c. General data
d. Specific data

296) Your client has an income-producing property that generates $30,000 per year. The property is valued at $400,000. What is your client’s capitalization rate?

a. 6
b. 7.5
c. 8
d. 8.5

297) Building codes, zoning laws, and environmental legislation can all influence the value of real property. How do appraisers refer to this type of value influencer?
a. Geographic
b. Governmental
c. Physical
d. Social

298) When the building value is known, but the land value is unknown, the ______ technique can be used.
a. Building residual
b. Capital recapture
c. Direct capitalization
d. Land residual

299) What’s the name for a capitalization method which converts a single year’s expected income into a market value?
a. Direct capitalization
b. Income analysis
c. Indirect capitalization
d. Yield capitalization

300) A capitalization rate takes an investment’s ability to produce income and converts it into ______.

a. Anticipated profit
b. Expected ROI
c. NOI
d. Value

301) Which factor that influences value addresses the ease with which the property can be conveyed to another?
a. Demand
b. Scarcity
c. Transferability
d. Utility

302) What type of capitalization helps to determine the expected return on investment the property is capable of producing in a single year?
a. Annuity method of capitalization
b. Direct capitalization method
c. Sales comparison approach
d. Yield capitalization method

303) The income approach to value relies on _______ when valuing single-family and two- to four-unit properties.
a. Capitalization rate
b. Gross income multiplier
c. Gross rent multiplier
d. Monthly net rent

304) What’s an appraisal?
a. An inspection of a home for defects
b. An unbiased estimate of property value as of a specified date
c. The process of forming an opinion of a property’s value
d. The study of a property, potentially for land use or marketability

305) Real property rights include the right ______.
a. Of enjoyment
b. To avoid taxation
c. To encroach on a neighboring property
d. To pollute a neighboring property

306) Which of the following best describes how an appraiser reconciles the adjusted sales prices of the comparable properties to indicate the value of the subject property?
a. The appraiser calculates the average of the three adjusted sales prices to use as the indicated value.
b. The appraiser selects the adjusted sales price of the property most like the subject to use as the indicated value.
c. The appraiser selects the highest value of the three adjusted sales prices to use as the indicated value.
d. The appraiser selects the middle value of the three adjusted sales prices to use as the indicated value.

307) Who is responsible for developing the Uniform Standards of Professional Appraisal Practice (USPAP) that licensed appraisers must follow?
a. Appraisal Practices Board
b. Appraisal Qualifications Board
c. Appraisal Standards Board
d. Appraisal Subcommittee

308) By comparing the number of houses sold to the number of houses listed for sale in a recent time period, appraisers can determine what trend?
a. Built-up percent
b. Neighborhood growth
c. Property values
d. Supply and demand

309) An appraiser is working to find the market rent for a 10-unit apartment building. In order to compare the subject property to similar properties, she will ______.
a. Calculate a gross income multiplier
b. Calculate a gross rent multiplier
c. Convert monthly contract rent to scheduled rent
d. Convert monthly rental income to annual dollars per room

310) Which of the following will an appraiser use to determine potential gross income for an income property appraisal?
a. Capitalized rent
b. Contract rent
c. Market rent
d. Scheduled rent

311) ____________ is when one party didn’t meet the terms of the contract in the specified time frame and is now being required to do exactly what was agreed to in the contract.

312) What’s the purpose of a home inspection?

313) Rick, a builder, is using two properties as collateral for a loan. This is an example of a (n) ________ loan.
314) An acre is equal to _________.
315) Niko has decided to move somewhere else when his lease ends on April 30. This would be considered termination through _________.
316) Which liens take priority over other liens?
317) Real property ownership has significant tax advantages. Which of the following is an advantage?
318) If licensees are asked to discriminate, what must they do?
319) What is self-dealing?
320) Why was the Civil Rights Act of 1866 monumental among fair housing and anti-discrimination laws?
321) The ________ protects consumers from unwanted email solicitations.
322) Given all of the laws prohibiting discrimination in housing, why does it still occur?
323) How does the income from property taxes benefit the community?
324) Which of the following is a benefit of the MLS from a broker’s standpoint?
325) Jamal is a real estate licensee. What’s his responsibility regarding household lead hazards?
a. He must disclose the possible presence of lead-based paint to a buyer if the home was built prior to 1978.
b. Or
c. He must remind the sellers to disclose the possible presence of lead-based paint to a buyer if the home was built prior to 1978.
326) What’s the depreciation schedule for a residential income-producing property?
327) Which of these items should real estate professionals help first-time buyers with recent credit issues understand?
328) Switches that are warm to the touch, damagd panels, and lights that dim or flicker when other appliances are in use can be signs of a (n) _________ problem.
329) With local land use, the stress placed on the community’s infrastructure is an example of __________.
330) What protects the buyer before the sale and can reimburse the buyer after the sale if a title issue arises?
331) If Mega Corporation owns real property, chances are it owns it in _________.
332) What instruments are commonly used to secure the purchase of real property?
333) Jimmy always has a face-to-face meeting before he works with any buyer. What might be a good reason for this?
334) What’s a survey?
335) _________ pay earnest money to solidify their commitment to completing a real estate transaction.
336) A defect on a title that can be monetary or physical is called an _______.
337) Sampson is acting as a buyer agent. What duties does he owe the seller in the transaction?
338) When does the sales contract become a legally binding document?
339) What’s a licensee’s responsibility regarding household lead hazards?
340) What’s the purpose of testing with regards to fair housing?
341) Local real estate developments, such as a new subdivision, will likely impact _______ the most.
342) When banks have lots of funds available for lending, what tends to happen to interest rates?
343) If Rina wants to pay off her mortgage early, what might she consider before doing so?
344) Fiona signed an agreement to either buy or not buy Nick’s vacant lot for $310,000 by a specific date. What’s this agreement called?
345) Edgar’s in the process of selling his home as a short sale. What’s a short sale?
346) You represent a buyer of a $1 million property. The seller’s agent, through the seller, offers a 2.5% cooperative agent commission. Who’s your client?
347) If a rectangular building were 40 feet by 20 feet, the area would be _________.
348) ________ may be found in paint in homes built before 1978.
349) Real estate, plus all of the interest, benefits, and rights included in ownership is also known as ________.
350) Which entity ensures that contractors perform their work according to code by inspecting their job sites?
351) How do you decide whom you represent in a transaction?
352) Which mortgage market is comprised of lending institutions that lend directly to the consumer?
353) What happens when a married couple who owns a property as tenants by the entirety divorce?
354) In caveat emptor states, whose responsibility is it to review disclosures, ask questions, and obtain a home inspection?
355) Who is responsible for ordering an appraisal, completing the loan application, ordering a home inspection, and obtaining homeowners insurance before closing?
356) Which type of antitrust violation involves two or more businesses conspiring against another business?
357) What instrument is generally used to convey property?
358) As a security precaution, when posting on social media, what should you do?
359) When a buyer hands over an earnest money check to you as the buyer’s agent, what’s your responsibility?
360) When assigning a contract, the assignor should also check to be sure that language regarding ________ is part of the purchase contract.
361) In full seller disclosure states, whose responsibility is it to notify the seller of the seller’s duty to disclose all known material defects?
362) Ken, Dale, and James are brothers who own more than 100 acres as tenants in common. The relationship between Ken and James disintegrated, and so James initiated a lawsuit. The end result is that the court gave each brother a designated set of acres to own. What was granted by the court?
A. Bifurcation
B. Parcel
C. Partition
D. Severalty

363) Eva, Stella, and Lynn own a vacation home two blocks from the beach. Sadly, Stella passed away this winter, and so when summer arrives Eva and Lynn will be sharing the home with Stella’s nephew Drew, to whom Stella willed her share of the property. What type of ownership is this?
A. Estate in severalty
B. Joint tenancy
C. Tenancy by the entirety
D. Tenancy in common

364) One way to demonstrate reasonable skill and care is by acting within the scope of your duties. When working an open house for one of her listings, Keira meets a young couple. They’re not looking to purchase anything right now, but are trying to get a sense for how much house their money will buy in different areas of town. Keira tells them about a few listings she knows about and the listing prices compared to house size and amenities. They also ask about financing a new home, the best way to save money for a down payment when they have other debt, and how much they should save. She tells them that in order to receive the best terms, they should have about 20% of the sale price saved for a down payment and that other debt will factor into the ability to obtain financing, so they should pay off anything they can. She also tells them that fixed-rate mortgages are better than adjustable-rate mortgages.
365) Was Keira’s discussion with the couple within the scope of her expertise?
A. Yes. Since the couple are not clients, she has more flexibility in what she can tell them.
B. No. She shouldn’t have told the couple about other properties around town.
C. No. She shouldn’t have given the couple advice related to specific mortgage types.

366) A friend of Keira’s represents sellers of a two-bedroom bungalow that would be perfect for Keira’s buyer client. She shows the buyer the property, but doesn’t tell them she knows the seller’s agent.
A. Loyal
B. Disloyal
367) Keira has a buyer looking at condos downtown, but she shows him a condo in the same price range slightly farther away from his desired area so he can see the difference in what his money will buy.
A. Loyal
B. Disloyal
368) Which of the following statements about the fiduciary duty of confidentiality is true?
A. It doesn’t extend to material facts relating to the property.
B. It encompasses any and all information the client tells the agent, not just confidential information.
C. It ends with the termination of the agency agreement.
D. It never conflicts with the duty of disclosure.

369) Which of the following is an example of the duty of loyalty?
A. Carrying out a client’s instructions without question
B. Keeping a client’s confidential information confidential
C. Never questioning a client’s opinion
D. Putting the client’s interest first

370) Which of the following statements best describes a listing that terminates by performance?
A. Evan performed all required fiduciary duties and tasks in listing Von’s house, even though it didn’t sell before the listing expired.
B. Greg listed a property that failed to sell during the term of the listing agreement. Aside from that, he performed all the tasks promised to the seller.
C. Marty listed Todd’s condo. With Marty’s efforts they got almost to closing only to have the buyer’s financing fall through.
D. Roberto listed a property for Terrence. After two failed offers, the property made it to a successful closing.

371) Which act prevents the fraudulent sale of property sight unseen through the regulation of land sales across state lines?
A. Interstate Land Sales Full Disclosure Act
B. Intrastate Citizens Protection Act
C. Police Power Act
D. Subdivision Act of 1997

372) The statute of frauds states that if a contract transferring ownership of real property is not in writing it is __________.
A. Enforceable
B. Executory
C. Void
D. Voidable

373) What is the key difference between assignment and novation of a contract?
A. Assignment releases the original party from all obligations, while novation does not.
B. Individual contracts must specifically allow novation, but not assignment.
C. Novation is disallowed in many states, while assignment is not.
D. Novation releases the original party from all obligations, while assignment does not.

374) When property changes hands, the deed is recorded. There’s a fee for recording. What is the benefit to the grantee of having the deed recorded?
A. It impacts who owns the property.
B. It protects against foreclosure.
C. It puts the public on notice regarding ownership.
D. It’s required by law.

375) How long after a notice of cessation or completion is filed can a contractor file a mechanics lien?
A. Within 60 days
B. Within 90 days
C. Within six months
D. Within two years

376) Frank has waited 30 days after notifying a client that the project he finished remains unpaid. The client has not filed a notice of completion or cessation with the county clerk. How long does Frank have left to file a mechanic’s lien?
A. 10 days
B. 30 days
C. 60 days
D. 90 days

377) What is the six-month rule for homestead exemptions?
A. No liens may be filed against homesteads unless at least six months’ notice has been given to the homeowner.
B. The property owner has six months to sell the property after a lien is filed.
C. The property owner must live in the home for at least six months before they may qualify for a homestead exemption.
D. The property owner must reinvest the homestead exemption amount within six months in another homestead to protect it from creditors.

378) Kris made an offer on Lincoln’s townhouse. However, Kris offered no earnest money. If Lincoln accepted her offer, would it be binding?
379) Which type of lien affects real and personal property?
380) What law governs the rules and regulations that tenants and landlords must adhere to in counties with 75,000 residents or more?
381) Which document is used to protect the buyer from title defects after closing?
382) In a typical real estate transaction, who is the seller?
383) A property manager is a ______ agent for the owner, and as such is authorized to perform all of the duties related to the property on the owner’s behalf.
384) Which scam, as described by the FBI, involves an appraiser working secretly with a borrower and providing a fraudulent appraisal report to the lender?
385) Which act encourages fair, truthful, non-deceptive, and evidence-supported claims in advertising?
386) Your assistant, Brady, often answers client questions about offers and negotiation. What do we know about Brady?
387) Sandra enters into a contract to sell her home to Paul. Under the statute of frauds, in order to be legally enforceable, the written contract must name the contracting parties, identify the subject matter of the contract, and ______.
388) A complaint was filed against Regina, a real estate licensee. At the TREC hearing, her license was revoked. How many commission members must have agreed with that decision?
389) Which of the following is true about title to a property?
390) The price for which an owner offers to sell a property is called the ______.
391) Per the TAR Purchase and Sale Agreement, when does the sales contract become a binding agreement?
392) In real estate contracts, which are required: legal descriptions or street addresses?
393) If a licensee is serving as a facilitator, rather than representing a buyer or seller, this must be disclosed to whom?
394) A consumer has just sued TREC for its role as an administering authority of license law. What will the likely outcome be?
395) What’s the maximum the Real Estate Education and Recovery fund will pay out on behalf of a single licensee, regardless of the number of awards or transactions involved?
396) Lacey is preparing an offer for her buyer clients, and it’s time to enter the amount of earnest money they’re going to offer. Which of the following statements is true regarding what earnest money the buyers should offer?
397) Which of these is an example of illegal market allocation?
a. Based on licensee expertise, Uptown Homes agrees with Country Cottage Realty to focus exclusively on suburban, rather than rural, homes.
b. A month-to-month lease agreement is considered to be this type of leasehold estate, in which the total duration is unknown.
c. estate at will
398) What may be found in paint in homes built before 1978?
399) A property appraised for $257,000 and the buyer paid $249,000. Which value will a lender use when determining the loan-to-value ratio?
400) Per the EPA, what must be conducted before a project may be approved for development?
401) What’s the purpose of the Interstate Land Sales Full Disclosure Act?
402) As required by the statute of frauds, every deed must have which of the following?
403) Which of the following is an adverse material fact?
404) What must a license applicant demonstrate to minimize the chance of license denial?
405) Errors and omissions insurance covers _______ who are sued by consumers for inadvertent mistakes in a real estate transaction.
406) At its most basic level, which type of antitrust violation is a conspiracy between business competitors to set their prices to buy or sell goods or services at a certain price point?
407) In what type of market might an agent ask the multiple buyers who have submitted offers to submit their highest and best?

408) Which choice correctly identifies the seven protected classes according to the Fair Housing Act?
409) Your clients, the Jamesons, are selling their lakefront property. They receive an offer, and the buyer has included a pre-approval letter. The Jamesons balk, saying, “We want a pre-qualification letter, or we’re not selling.” What do you tell them?
410) Which one of the following statements regarding depreciation schedules is true?
411) Which entity guarantees loans?
412) Based on the duty of reasonable skill and care, if clients ask agents for advice in areas outside of an agent’s scope of expertise, what should agents do?
413) When finding listings, which statement describes the farming approach?
414) Mary, who’s suffering from Alzheimer’s disease, signs a contract to buy Edgar’s home. Before the deal closes, it’s determined that Mary lacks legal capacity to enter into a contract. Which party is permitted to void the contract?
415) Historically, what do property values tend to do over long periods of time?
416) Which type of estate conveys possession and control, but not title?
417) Broker Regina tells her client that a property is zoned as residential, even though she’s pretty sure it’s zoned commercial. This violation is an example of _________.
418) Uh-oh. You failed to present an offer on behalf of your client in a timely manner. As a result, the seller accepted a lower offer from another buyer. For which of the following could your buyer sue you?
419) What’s a covenant between a lessor and lessee?
420) ______ is when the buyer and seller settle all terms of their agreement.
421) What type of real estate market occurs when both supply and demand are low?
422) Once signed, the listing agreement is a legally binding contract between _______.
423) Proposed zoning ordinances must undergo tests to determine their validity. These tests include which of the following?
424) Which type of buyer tends to know little about the homebuying process and has limited funds?
425) In a deed, this person is referred to as “the party of the first part.”
426) When preparing the sales contract, when is it acceptable for a licensee who is not an attorney to offer legal advice to the client?
427) Loans available through the Farm Service Agency have which of the following characteristics?
428) Which type of property manager works mostly with real estate developers and investors?
429) How can a licensee earn commission from a seller who has not listed the property through an agent?
430) The owner-manager relationship is based on the property manager performing particular duties. This would include ______.
431) What would the monthly rate be if annual taxes are $890? Round to the nearest cent.
432) Before closing, who is generally responsible for obtaining an appraisal, completing the loan application, ordering a home inspection, and securing homeowner’s insurance?
433) Co-ownership with inheritance rights is what kind of real property ownership?
434) To what properties does the Tennessee Residential Property Disclosure Act apply?
435) Jorge is a dual agent. He owes his clients all of the following fiduciary duties except ______.
436) The Title and Conveyance paragraph of the TAR Purchase and Sale Agreement stipulates that the seller is conveying the property to the buyer with ________________.

437) An affiliate broker may perform brokerage duties under what circumstances?
438) What is a primary factor a lender reviews when determining if a borrower is a good credit risk?
439) Under which of the following conditions is it unacceptable to disclose confidential information?
440) What type of real estate market occurs when supply is high and demand is low?
441) Brenda, a new licensee, wants to impress her buyer clients, the Changs, who are practically royalty in China, their country of origin. Her responsibility is to _________.
442) Kevin, a real estate licensee, works independently instead of under a sponsoring broker. This means that he is licensed as ________.
443) Your clients, the Samsons, ask you to provide them with an appraisal in order to determine a list price for their property. Since you’re not an appraiser, what should you do?
444) Which of the following is a violation of federal fair housing law?
445) When a higher-quality property is adjacent to a lower-quality property, it can increase the lower-quality property’s value. What economic principle is this?
446) The Emery family, along with 20 other families, purchased a timeshare estate that will enable them to share a condominium in a resort community. A timeshare estate involves a ______ type of ownership.
447) Which of these pieces of legislation work together to prevent discriminatory lending practices?
448) Which of the following scenarios is an example of group boycotting?
449) Caveat emptor means ________.
450) Michael doesn’t have a real estate license, but he helps his friend, Nancy, sell her home. What can Michael legally receive as compensation?
451) Which type of real estate license requires successful completion of a 90-hour course and passing the licensing exam before a license is issued?
452) Brendon is obtaining a loan to buy a home. When reviewing his loan documents, he sees one called a note and one called a mortgage. What is the role of the note?
453) How many approaches to value do appraisers generally use?

454) Mark works at Farm and Country Bank, and has arranged an agricultural loan for Josh, a local organic farmer. Josh didn’t meet the bank’s normal underwriting standards, but Mark made the loan because he was able to arrange for a guarantee from ______.
a. Farmer Mac
b. The Farm Credit System
c. The Farm Service Agency
d. The Federal Agricultural Housing Authority

455) When a developer selling timeshare units receives earnest money deposits or down payments, what is the developer required to do with that money?
a. Forward the money to the timeshare owner’s association
b. Hold the money in the developer’s escrow account for no more than three days
c. Hold the money in the developer’s escrow account through the buyer’s rescission period
d. Maintain the money in a trust fund account that will be used for maintenance of the timeshare complex

456) Which type of events are generally on a title insurance policy’s schedule of exceptions?
a. Claim from an owner with an unrecorded deed
b. Claim that was filed on the public record before a title insurance policy’s effective date
c. Liens or claims that aren’t on the public record
d. Mechanic’s liens filed prior to a title insurance policy’s effective date

457) Annie and George have been saving and are finally ready to purchase their first home for their family (including their two toddlers). They want to make an offer on a sweet little bungalow in a quiet Richmond neighborhood. If the sellers are represented by a real estate licensee, which situation would be a violation of fair housing laws?
a. Their offer is rejected because it’s too low.
b. Their offer is rejected because the seller knows the neighbors don’t like children.
c. They rescinded their offer when a house they were previously outbid on became available again.
d. They rescinded their offer when their inspection revealed structural issues with the house.

458) Who is responsible for testing private wells for water safety?
a. Property owners
b. The DEP
c. The EPA
d. The local water utility

459) Which of these statements about cooperating with other licensees is true?
a. Licensees must cooperate with and compensate other licensees, but only when it’s their client’s best interest.
b. Licensees must cooperate with and compensate other licensees, even if it is not in their client’s best interest.
c. Licensees must cooperate with other licensees, but only if it’s in their client’s best interest, and there’s no obligation to compensate cooperating licensees.
d. Licensees must cooperate with other licensees, even if it is not in their client’s best interest.

460) Who is responsible for testing community wells?
a. The DEP
b. The EPA
c. The local health department
d. The local water utility

461) The ______makes it illegal to send unsolicited commercial solicitations via fax without the recipient’s permission or an established relationship.
a. Anti-Telemarketer Act of 2000
b. CAN-SPAM Act of 2003
c. Do Not Call Implementation Act of 2003
d. Junk Fax Prevention Act of 2005

462) What is a general lien?
a. A claim against a person and all of that person’s property
b. A claim against a specific piece of property
c. A type of mortgage lien
d. A type of tax lien

463) Under standard lease provisions, a demising clause would contain ______.
a. A demising clause states when the landlord will lease the property and the date the tenant will take possession.

464) A requirement for legal competence
a. The date the tenant will take possession of the property
b. The schedule for rate increases
c. The street address and unit number, if applicable, and possibly the legal description
d. The date the tenant will take possession of the property

465) Which of the following statements describes laws and ethics?
a. Both laws and ethics establish what actions are deemed illegal and are punishable.
b. Ethics are consistent from person to person, whereas laws may change.
c. It’s not a punishable offense to violate either laws or ethics.
d. Laws are made by the government, and ethics are dependent on conscience and values.

466) How many hours of continuing education must first-year salespersons take?
a. 16
b. 30
c. 60
d. None; they must take 30 hours of post-licensing education

467) Activities that restrain trade and reduce competition and choices for consumers are considered to be what kind of violations?
a. Agency law
b. Antitrust
c. Fair housing
d. License law

468) When prospecting and soliciting for new business, licensees should be familiar with what federal acts?
a. Do Not Call Implementation Act, CAN-SPAM Act, and Junk Fax Prevention Act
b. Do Not Call Implementation Act, Sherman Act, and Unfair Trade Practices Act
c. Human Relations Act, Fair Housing Act, and Americans with Disabilities Act
d. Sherman Act, Clayton Act, and Unfair Trade Practices Act

469) Real property ownership may have significant tax advantages. Which of the following is a potential advantage?
a. Depreciation
b. Insurance expenses
c. Taxable gains
d. Transfer tax

470) Your neighbor Mort wants to buy an investment property but he’s a busy man and asks you to act as his attorney in fact as well as his buyer’s agent. What should you tell Mort?
a. Sure, but it only under a specific power of attorney
b. Sure, but only because I also hold a law degree
c. That would be a conflict of interest
d. That would not be possible because neighbors are not allowed to be attorneys in fact

471) What’s an MLS?
a. A classified advertising site that charges by the column inch
b. A free service for real estate professionals and the public
c. An online database of active, under contract, sold, expired, and withdrawn listings
d. A proprietary site open only to real estate professionals

472) Carson is purchasing a $600,000 property by obtaining an 80/20 loan. How much is Carson financing?
a. $120,000
b. $420,000
c. $480,000
d. $600,000

473) Why does HUD test for housing discrimination?
a. To create revenue through fines
b. To educate the public
c. To punish blatant discrimination
d. To uncover hidden discrimination

474) Which of the following options describes a method by which a licensee can determine an appropriate listing price range?
a. Appraisal
b. Comparative market analysis
c. Creative market analysis
d. Proforma

475) The secondary market is comprised of _________________________.
a. FNMA, GNMA, FHLMC, and lending institutions that buy loans from other lenders
b. Lending institutions that lend directly to consumers
c. Savings and loans, thrifts, and credit unions
d. The VA and the FHA

476) Which of these is NOT a form of ownership for real estate?
a. Joint tenancy
b. Riparian
c. Severalty
d. Tenancy in common

477) What is the purpose of the Common Interest Communities Law?
a. To administer and promulgate fair housing laws within the scope of common interest communities.
b. To collect taxes from common interest communities.
c. To create a policy board and regulations to administer the Virginia Property Owners’ Association Act, Cooperative Act, Condominium Act, and Time-share Act.
d. To develop regulations for licensure of real estate professionals who specialize in common interest communities.

478) What are two types of evictions?
a. Actual and constructive
b. Easement and encroachment
c. Proactive and reactive
d. Probationary and statutory

479) Federal and state fair housing laws are designed to _______:
a. Allow the disabled to pay lower rents
b. Group like-minded people together in neighborhoods and housing units
c. Help those from other backgrounds assimilate into American culture
d. Protect certain classes of people from housing discrimination

480) If you’re in a caveat emptor state, which statement about property condition disclosures is true?
a. The seller isn’t obligated to proactively disclose property defects.
b. The seller must conduct a home inspection in addition to providing disclosure forms.
c. The seller must proactively disclose any known defects.
d. The seller must proactively disclose any known defects and the seller must have a home inspection conducted.

481) What can a wet environment with little air circulation do?
a. Kill mold
b. Lead to mold growth
c. Prevent mold from growing
d. Remove mold

482) When does the purchase agreement become a legally binding contract?
a. After an attorney reviews it
b. Once both parties sign it
c. Once the seller provides verbal agreement to the buyer’s offer
d. The moment the buyer signs the document and sends it to the seller

483) Joe and Emma Parsons begin informally working with their neighbor Kyle, who’s a real estate licensee, to find a bigger house. The parties have not signed any agreements or discussed the arrangements. This is an example of a(n) ______ agency agreement.
a. Executory
b. Express
c. Implied
d. Unspoken

484) A broker’s price opinion is generally written by whom?
a. A buyer
b. An appraiser
c. A real estate broker for a buyer
d. A real estate broker for a lender

485) Licensee Kyle has had a few casual meetings with a potential client, Mary. Mary told Kyle the type of home and area she’s interested in, and Kyle mentioned a few homes he thinks Mary might be interested in. Although Kyle hasn’t said he will continue to look for homes for Mary, Mary believes he’ll do just that. Which of the following statements about this situation is correct?
a. Because Kyle doesn’t know if Mary is working with another agent, he’s just inadvertently created a dual agency situation.
b. Because Kyle has performed some agency-related tasks for Mary, he has an express agency agreement with her.
c. Kyle and Mary have no agency agreement—either express or implied—until Kyle begins showing Mary homes.
d. Kyle’s actions may have created an implied agency agreement with Mary.

486) Which document spells out for buyers all settlement costs in a federally related residential real estate transaction?
a. Closing Disclosure
b. Consumer Notice
c. Freddie Mac borrower disclosure
d. MLS affidavit to consumers

487) Google and “if this, then that” alerts can assist you with which of the following?
a. Guaranteeing that the property owner receives all rental income
b. Monitoring your online listings for rental scams
c. Posting your online listings for rent
d. Removing your listings from a rental website

488) The number of properties available describes this factor that influences value.
a. Demand
b. Scarcity
c. Transferability
d. Utility
e. Scarcity is related to demand, and reflects the supply of property, or lack thereof.

489) Which of these items should real estate professionals help first-time buyers and buyers who have experienced recent credit issues to understand?
a. Appropriate financing
b. High-risk loan products
c. Rental options
d. Rental options and high-risk loan products

490) Jill needs to pay the web developer who created a new website for her brokerage, but her checking account is low, so she floats herself a loan from earnest money kept in the brokerage’s escrow account and deposits it in her account for a few days before paying the developer. Which answer correctly identifies the violation(s) Jill has committed?
a. Commingling and conversion
b. Commingling only
c. Conversion only
d. Deceptive business practice

491) Which of these situations would result in the earnest money being disbursed to the seller?
a. The buyer backs out when the appraisal comes in too low to satisfy the contingency.
b. The buyer includes hard money in the purchase offer, then terminates the sale when the appraisal comes in low.
c. The escrow agent converts the earnest money.
d. The seller gets cold feet and cancels the transaction.

492) Your client, Bruno, is an investor. He is in the process of selling a fourplex and mentions to you that he hates the idea of the capital gains tax he’ll be subject to. What should you tell him?
a. “Capital gains do not apply to investment properties.”
b. “Investors don’t pay taxes.”
c. “Taxes are required, no matter what you do.”
d. “You might consider a 1031 tax-deferred exchange.”

493) Mary is preparing a purchase offer for her buyer client. It’s a pretty standard offer: a little less than list price, with the seller paying a little toward the buyer’s closing costs. Mary fills in the blanks on a standard form used in her brokerage firm based on the current situation. Is this okay?
a. No, Mary is not an attorney and shouldn’t prepare contracts.
b. No, Mary should have her client prepare the offer.
c. No, Mary should hire an attorney to prepare the purchase offer.
d. Yes, Mary can use the standard forms that her brokerage uses (assuming these forms were originally created or approved by an attorney).

494) Cracks, holes, or rotten areas on a soffit are common ______ issues.
a. Chimney
b. Foundation
c. Roof
d. Window

495) A licensee says, “This is a dream home with the best views in town.” This is an example of _______.
a. A lie
b. Intentional misrepresentation
c. Positive misrepresentation
d. Puffery

496) Plat of Block 28, Woodmen Heights Tract, recorded in Map Book 27, page 68, at the Eldor County Records Office is an example of which essential element of a deed?
a. Consideration
b. Granting clause
c. Habendum clause
d. Legal description

497) Which of the following best describes the fiduciary duty of confidentiality?
a. You must keep all material facts confidential.
b. You must keep all parties’ information confidential.
c. You must not discuss confidential matters with your client.
d. You must not share your client’s confidential information.

498) ______ is a process in which an appraiser determines a probable range of values for a property by comparing a group of comparable sales to the subject. The appraiser attempts to include both superior and inferior units of comparison, such as age, transaction price, etc.
a. Bracketing
b. Bridging
c. Substituting
d. Surrounding

499) Cultivated crops are considered personal property even though they’re part of the soil, and they’re known as _______.
a. Accessories
b. Accoutrements
c. Emblements
d. Produce

500) Which statement best describes a trade fixture?
a. A fixture or item installed by a commercial tenant that becomes personal property of the landlord when the tenant moves out
b. A fixture or item installed by a commercial tenant that’s considered personal property of the tenant
c. Personal property of the tenant used as a bargaining chip when negotiating a sale
d. Property of the landlord that’s used by the tenant and must remain on the premises when the tenant moves out

501) A landlord discovers that his married tenants are expecting their first child. He wouldn’t have rented to the couple had he known they were going to have children, so he serves them with an eviction notice and tells them they must be out in 30 days. The landlord is guilty of ______.
a. Familial status discrimination
b. Racial discrimination
c. Religious discrimination
d. Sex discrimination

502) What types of monies received from income-producing properties should be deposited into an escrow account?
a. Current rent and prepaid rent
b. Current rent and security deposits
c. Current rent, prepaid rent, and security deposits
d. Prepaid rent and security deposits

503) Which option best describes a delivery and acceptance of a deed as required?
a. Grantor has acknowledged and voluntarily signed the deed in front of a public notary and delivered it in person to the grantee or an agent of the grantee
b. Grantor has handed the grantee the deed and the grantee has signed it in front of a public notary voluntarily accepting it.
c. Grantor has mailed the deed to the county clerk’s office for recording.
d. Grantor has signed the deed and left it on the grantees patio.

504) What’s the purpose of a POA’s restrictive covenants?
a. To encourage the residents to live there long-term
b. To make it harder to sell the properties within the POAs
c. To preserve a community’s overall aesthetic
d. To weed out people of certain ethnicities

505) What is the term used to describe submerged land below the mean water mark?
a. Aqueducts
b. Channels
c. Mud pits
d. Water bottoms

506) In which of these situations does the disclosure for unrepresented parties need to be provided?
a. Any time an agent is interacting with an unrepresented party and the discussion starts to become substantive
b. Any time an agent speaks to a party who is not represented by an agent
c. Any time an agent speaks to the opposing party without their agent present
d. To any prospective buyer attending an open house

507) An organization with many investors who jointly participate in a real estate investment and must adhere to the rules and regulations of the Securities and Exchange Commission is a ______.
a. C corporation
b. Partnership
c. S corporation
d. Syndicate

508) Which term describes the process of real property becoming personal property by detaching it from the land?
a. Accoutrement
b. Annexation
c. Emblement
d. Severance

509) What’s the purpose of testing with regard to fair housing?
a. To educate applicants
b. To increase fines on landlords
c. To punish blatant discrimination
d. To uncover hidden discrimination

510) A borrower has a 30-year, $500,000 loan with an interest rate of 6.25%. His monthly principal and interest payment is $3,078.59. How many payments will he make over the course of the loan?
a. 180
b. 240
c. 30
d. 360

511) All of the homes on Elm Street are currently on septic systems. However, the county plans to extend the sewer lines to Elm Street within the next two years. What’s the biggest reason why it’s important for your buyers to know this?
a. Public sewers have a better safety record than septic systems.
b. Sewer installation means construction traffic.
c. Some people prefer septic systems to having to tie into public sewers.
d. The county will likely impose an installation fee on Elm Street residents to cover the costs.

512) Which statement about lead-related health problems is true?
a. Lead can be traced to senioritis.
b. Lead causes blindness upon contact with the eyes.
c. Lead is associated with coronary heart disease.
d. Lead may cause behavioral problems, learning disabilities, seizures, and, in extreme cases, death.

513) John’s property is shaped like a triangle. The street side is 185 feet, and from the street to the longest point of the triangle is 225 feet. How do you calculate the square footage of John’s property?

a. Add 185 to 225.
b. Multiply 185 by 225, then divide by four.
c. Multiply 185 by .5; multiply your answer by 225.
d. Multiply 185 x 225.

514) Using the capitalization formula, what is the value if the net operating income is $20,000 and the rate of capitalization is 10%?
a. $2,000
b. $20,000
c. $200,000
d. $2 million

515) A fire destroyed Meredith’s house. Meredith contacted her insurance company, and she was shocked to learn her insurance policy didn’t fully cover what she paid for the property. How does the insurance company determine the replacement value of her home?
a. Its current market value
b. The amount it appraised for
c. The amount it would cost to completely replace her home
d. The original sales price when it was first constructed

516) A quitclaim deed does which of these?
a. Transfers a property with only the covenant of warranty
b. Transfers the property with full covenants
c. Transfers without warranty any interest or title the grantor has when conveying it
d. Transfers with warranty any interest or title the grantor has in the property when conveying it

517) In many cases, property managers must get explicit permission in order to disburse funds from a trust account. What is one common way to do so without this explicit permission?
a. Ensure the bank has a signature card for the property manager.
b. Give the property manager a power of attorney.
c. Have all who supply trust funds sign waivers.
d. Put it in the property management agreement.

518) Johannes must obtain a permit for a construction project that is located right next to a wetlands. Which federal law or regulation requires him to get the permit?
a. Army Corps Construction Regulations
b. Clean Water Act
c. Coastal Zone Management Act
d. Rivers and Harbors Act

519) When a licensee is working with a property located near a Superfund site, what does that mean?
a. A portion of the sale price must go to the EPA to fund clean-up of the site.
b. The licensee is required to disclose potential health threats to anyone in the area when showing the property.
c. The licensee must disclose the existence of an environmental hazard in the area.
d. The property cannot be sold until the site is removed from the NPL.

520) Which of these situations represents the illegal practice of redlining?
a. Arlo, a licensee, distributed a flyer in several neighborhoods warning of impending commercial developments that would negatively impact property values.
b. Eunice refuses to allow her agent to show her house to families with children.
c. Hunter, a mortgage broker, refuses to underwrite mortgage applications from applicants who are buying in specific neighborhoods, based on the neighborhood’s demographics.
d. Jaime is working with Korean clients. He’s focusing on homes in Korean communities because he thinks his clients will be more comfortable there.

521) Redlining is the practice of selecting geographical areas in which no mortgage loans will be written (based on demographics instead of creditworthiness).
522) Jeanetta leases an apartment from Quad City Leasing. Jeanetta has filed a complaint with the state real estate licensing division stating that Marissa, Quad City’s property manager, breached her fiduciary duty of loyalty to Jeanetta. Which of these statements about this situation is true?
a. As a property manager, Marissa doesn’t owe fiduciary duties to clients or residents.
b. As a property manager, Marissa owes fiduciary duties to her client and the apartment community.
c. If Marissa did breach a fiduciary duty to Jeanetta, Jeanetta has a legitimate complaint.
d. Marissa owes fiduciary duties only to the landlord.

523) Property managers owe fiduciary duties to their clients (the landlord) and the community as a whole, not to individual residents.
524) In which of these situations would the property most likely be conveyed with a trustee’s deed?
a. Karla is the executor of her father’s estate and is selling his farm.
b. Marvin and Tricia are selling their house.
c. Tim’s property will be sold at auction in a foreclosure action.
d. TLC Lending is selling an REO property.

525) states that use a deed of trust as security for a mortgage, the trustee conveys foreclosed property with a trustee’s deed.
526) Luci’s client Kaden wants to purchase a new construction property, and he wants to get as much house as he can afford. Which of the following does Luci need to advise Kaden about regarding interest rates when purchasing a newly built home?
a. If Kaden uses his builder’s lender, he can get a better interest rate and won’t have to worry about market fluctuations between now and closing.
b. Kaden doesn’t need to worry about interest rates for his long-term mortgage until 90 days prior to closing when he can lock in the best rate.
c. Kaden needs to allow for the possibility of an interest rate increase between now and closing because lenders aren’t likely to lock in an interest rate for more than 90 days before closing.
d. Kaden needs to lock in the interest rate on his long-term mortgage now to avoid unexpected increases that could put his loan amount over his approval amount.

527) Jerrica is set to close on the property she’s buying on Friday. Because of other delays in the closing date, Jerrica’s interest rate as of the day of closing will increase by 1/4 of a percent. What impact does this have on the closing?
a. A new Closing Disclosure must be issued at least three days before the closing date.
b. A new Loan Estimate must be issued, so the closing date must be moved back.
c. Jerrica will not be able to close until she re-applies for her loan.
d. The closing date will remain the same, but Jerrica will need to bring additional funds to the closing

528) Mike’s been friends with Tim since college. They often work together: Mike flips houses and Tim’s an appraiser that he uses frequently. It works out great for both friends and Mike definitely gets a better appraised value on the flips Tim handles. For every appraisal Tim handles for him, Mike gives him a $100 gift card. In what illegal practice does it sound like they’re engaging?
a. Equity skimming
b. Falsely inflating appraisals
c. Under-valuing the homes
d. Violating fair housing laws

529) For conventional loans in which the loan-to-value ratio is in excess of of a certain percentage, lenders generally require private mortgage insurance. What’s this percentage?
a. 75%
b. 80%
c. 85%
d. 90%

530) Loans above 80% don’t conform to Fannie Mae/Freddie Mac guidelines, so a lender may require PMI to offset the risk.
531) Corinne is 68 years old and employed full time. She’s of Spanish descent, is raising her 12-year-old grandson, and lives with her partner, Katherine. She requires an accessible apartment because she uses a wheelchair. Under which of the following federally protected classes might Corinne be protected if she faces housing discrimination?
a. Age, employment status, national origin, familial status, and sexual identity
b. Age, race, familial status, sexual identity, and disability
c. National origin, sex, disability, and familial status
d. Religion, familial status, and disability

532) Federal fair housing laws don’t name age, employment status, or sexual identity as protected classes. Corinne would be protected if she experienced housing discrimination based on her national origin, sex, disability, or familial status.
533) Savvy’s buyer client made an offer on a property but is having second thoughts. Savvy tells her client that she’ll ask the seller’s agent for an extension on the inspection period “to gather more bids,” and use that time to look at other properties to avoid losing out on the current property. Savvy’s client found a property she liked better, so they made an offer. The offer was accepted, so Savvy contacted the first property’s agent to terminate that offer. Is this wrong?
a. No, she acted in her client’s best interest.
b. No, she fulfilled her duty of loyalty to her client.
c. Yes, she broke a contract.
d. Yes, she did not treat the other party honestly, or act in good faith.

534) In pricing a property, what might expired listings tell the real estate professional?
a. The price at which a property is most likely to sell
b. The price at which a property won’t sell
c. The property’s competition
d. When the home will sell

535) How are principal meridians and baselines used in the rectangular government survey system?
a. All legal descriptions in this system use a single principal meridian and multiple baselines.
b. A principal meridian separates each township from the next and baseline separates each tier from the next.
c. Each legal description in this system originates at the intersection of a principal meridian and a baseline.
d. The boundary formed by two principal meridians and two baselines forms a township.

536) A buyer is purchasing a property for $400,000. His loan-to-value ratio is 80%. The lender also charges a 1% loan origination fee. How much is the loan origination fee?
a. $3,200
b. $3,600
c. $4,000
d. $800

537) An 80% LTVR means the buyer is financing 80% of the purchase price. This equates to $320,000, and 1% of this amount is $3,200.
538) Margo’s accountant tells her that she’s eligible to deduct the property taxes she paid last year. Select the statement about this deduction that’s true.
a. Margo can only deduct the property taxes charged back to her at closing.
b. Margo has to be an investor to be eligible to deduct property taxes.
c. Margo is in the ownership stage of the property ownership lifecycle.
d. Margo is in the reversion stage of the property ownership lifecycle.

539) Katherine is purchasing a second home as an investment/vacation property. She has a large down payment, and the seller is financing the rest of the purchase. Which of these statements is true?
a. The CFPB provides forms similar to the Closing Disclosure and Loan Estimate for seller/financers to use.
b. The Closing Disclosure and Loan Estimate aren’t required in a seller-financed transaction.
c. The seller is required to provide the same disclosure forms to Katherine as a standard lender would provide.
d. The seller will provide the Closing Disclosure and Loan Estimate to Katherine but has a longer timeframe to do so than a traditional lender would have.

540) In a seller-financed transaction, the Closing Disclosure and Loan Estimate aren’t required. Some other form of statement may be prepared to show the buyer and the seller their respective closing figures.
541) The purchase price of the home Leroy is buying is $300,000. He’s putting $100,000 down and is paying three discount points. How much will this cost?
a. $2,000
b. $4,000
c. $6,000
d. $9,000

542) What title guarantees will Jody have if her property is deeded to her after a foreclosure?
a. The covenant against encumbrances
b. The covenant of further assurances
c. The covenant of quiet enjoyment
d. The covenant of seisin

543) Which of these statements about statutory duties and fiduciary duties is true?
a. Statutory duties are typically imposed in addition to fiduciary duties.
b. Statutory duties spring from common law and include six duties that licensees owe clients.
c. Statutory duties spring from state statutes and tend to be more specific than fiduciary duties.
d. Statutory duties tend to be more broad than fiduciary duties.

544) The two real estate firms in one small town, Vineyard Realty and Homestead Homes, agree to charge the same commission rate to avoid the possibility of clients selecting a firm based simply on price. What specific federal legislation prohibits this?
a. The Clayton Act of 1914
b. The Federal Trade Commission Act of 1914
c. The Restraint of Trade Act of 1894
d. The Sherman Antitrust Act of 1890

545) Which of these examples describes a prepayment penalty?
a. A fee the government charges the lender if the borrower pays off a loan before its intended time
b. A fee the lender charges for servicing a loan
c. A loan origination fee charged to the borrower
d. A monetary penalty imposed on a borrower for paying off a loan before its intended time

546) An abandoned or otherwise unused commercial or industrial site with suspected contaminants is known as what?
a. A brownfield
b. A Brown Zone
c. A space that cannot be used
d. A special use landfill

547) year! Kim is taking a leave of absence from her job to accompany Marta. They don’t want their home in a gated community to sit empty, so they’d like to rent it out for the year. What might prohibit them from doing so?
a. County ordinance
b. Homeowner regulations
c. Neighborhood watch group
d. State law

548) County or state laws likely wouldn’t address homeowners’ ability to lease an owned piece of property, but HOA regulations might.
549) What’s the primary difference between an ordinary and a pur autre vie life estate?
a. An ordinary life estate ends when the grantor dies; a pur autre vie life estate ends when the estate holder dies.
b. An ordinary life estate ends within a specified period of time; a pur autre vie life estate ends when the estate holder dies.
c. An ordinary life estate ends with the death of the estate holder; a pur autre vie life estate ends with the death of someone other than the life estate holder.
d. A pur autre vie life estate ends within a specified time period; an ordinary life estate ends when someone other than the estate holder dies.

550) Elaine owns a home on a flag lot behind James. Her easement for a common driveway runs through James’s property. What kind of ownership rights does Elaine have of the driveway that runs through James’s property?
a. Absolute
b. Non-possessory
c. Possessory
d. Temporary

551) Jerry and Simon signed a contract so that Jerry could purchase all of Simon’s restaurant equipment for one price after Simon closes his restaurant next month. The contract contains a provision that states Jerry has one year from the purchase date to file a suit relative to the purchase. After the year is up, Jerry forfeits the right. What kind of contract clause is this?
a. Specific time
b. Statute of limitations
c. Time is of the essence
d. Time of performance

552) Dave’s company just did some renovation work on a free-standing hobby store in order to ensure that it’s ADA compliant. As Dave is doing the final walk-through, he notes that the aisles are now wider, the restrooms each have an accessible stall, and the water fountain near the restrooms is lower and has more clearance. But he notices that one critical renovation hasn’t been made. Which of these is key for ADA compliance?
a. The cash register should be lower with no visual barrier.
b. There should be a completely separate accessible restroom.
c. There should be an accessible pay phone in the store.
d. There should be a ramp in addition to steps for wheelchair accessibility.

553) Pay phones aren’t required, nor are accessible cash registers. But ramps for wheelchair access to the store are key!
554) How many acres are in a parcel described as, “The E 1/2 SE 1/4 NE 1/4 Section 3, Township 4 North, Range 2 East of the 6th PM”?
a. 160
b. 20
c. 40
d. 80

555) If the private individual owner doesn’t own more than three single-family homes at one time, which exemption from the Fair Housing Act could apply?
a. Housing designated for senior use
b. “Mrs. Murphy” exemption
c. Owner-occupied buildings with no more than four units
d. Single-family housing sold or rented without the use of a broker

556) Celia was obtaining a conventional loan, and she put $50,000 down as a down payment. Why might her lender also require her to obtain private mortgage insurance?
a. Her down payment of $50,000 isn’t at least 20% of the purchase price.
b. Her lender is a subprime lender.
c. PMI is triggered at the $50,000 down payment amount.
d. She has poor credit.

557) Roland’s farm land is assessed at 1.5 million dollars and the improvements for $500,000. At a tax rate of 4 mills, how much are Rolan’s monthly taxes?
a. $6,667.00
b. $667.00
c. $8,000.00
d. $80,000.00

558) Which of these areas would be included in the livable area calculation?
a. A detached garage
b. An attached garage
c. An unfinished attic area with seven-foot ceilings
d. A pool house connected to the house by a hallway

559) In a residential real estate sale involving a federally related loan, what entity is required to provide Real Estate Settlement Procedures Act disclosures to the consumer?
a. The consumer’s lender
b. The consumer’s mortgage broker
c. The consumer’s real estate broker
d. The settlement officer for the transaction

560) Shalonda is looking to purchase a home for $325,000 using a conventional loan. She has $49,000 to place as a down payment on the house. Which of the following statements is true?
a. Her down payment on the loan only needs to be 3.5%.
b. She must come up with another $16,000 to purchase the house.
c. She will be required to purchase MIP.
d. The loan-to-value ratio exceeds 80%.

561) Seller Jamison is closing on his property with buyer Conrad. Jamison paid the current year’s property taxes already. Is this a prepaid or accrued expense, and how will it be represented on the settlement statement?
a. The taxes are an accrued expense, and will appear as a buyer credit and a seller debit.
b. The taxes are an accrued expense, and will appear as a buyer debit and a seller credit.
c. The taxes are a prepaid expense, and will appear as a buyer credit and a seller debit.
d. The taxes are a prepaid expense, and will appear as a buyer debit and a seller credit.

562) These taxes have already been paid, so they are a prepaid item. They’ll appear as a buyer debit and seller credit at closing.
563) If there’s no state or local building code to cover a specific situation, what code must the builder abide by?
a. The Builder Code of 1912
b. The builder’s own
c. The Development Code of 1986
d. The federal building code

564) A closing agent has several duties to perform both before and after the closing. Which of the following is a task the closing agent must complete after the closing?
a. Obtain title insurance
b. Pay the existing loan off
c. Perform a title search
d. Prepare a closing statement

565) A brokerage firm that hires licensees as employees instead of as independent contractors must ______.
a. Advise the state licensing regulators of the non-traditional working relationship
b. Avoid controlling their activities too closely to ensure proper worker classification
c. Offer incentive bonuses to ensure a motivated workforce
d. Pay licensees a regular salary regardless of the revenue they generate

566) Stu is buying Freddie’s property. What must occur for the transfer of title to take place?
a. Freddie and Stu must sign the deed.
b. Freddie must intend to convey the property to Stu.
c. Stu must convey the deed.
d. Stu must sign the deed.

567) What’s the penalty for violating federal do not call rules?
a. A fine of more than $40,000 for each day violations took place
b. A fine of more than $40,000 for each violation
c. Restrictions on all business telephone use
d. Suspension of the violator’s business license

568) Which of the following is an example of commingling?
a. Mixing earnest money with personal funds
b. Mixing two earnest money deposits
c. Paying licensee bonuses from forfeited escrow deposits
d. Using escrow funds to pay business expenses

569) Your clients are purchasing a $160,000 home. If they have a down payment of 25% and the bank charges two points at closing, how much are they paying in points?
a. $2,350
b. $2,400
c. $2,450
d. $2,475

570) Christine listed her house with you. Tailleur represents the buyer, Rebecca, and the seller’s mother, Freida, is paying your commission. Which of these factors determines how legal agency is determined in this situation?
a. Christine listed the property with you.
b. Christine’s mother, Freida, owns the house you listed.
c. Freida is paying your commission.
d. Tailleur represents the buyer.

571) LaTonya’s aunt left her a bungalow on the outskirts of the city. For many years, it was the place for family holiday gatherings, and LaTonya’s sister was even married there. That’s why her family is so upset to learn that she plans to sell the bungalow as soon as she gets it cleaned out. Which real property right allows her to sell the property?
a. Control
b. Disposition
c. Exclusion
d. Possession

572) The right of disposition includes the right to determine how, when, and if the property is to be sold or transferred to another owner.
573) Which of the following would be a description used for real property and a fixture?
a. Above-ground
b. Free-standing
c. In-ground
d. Movable

574) Your client Faye is buying a condo downtown for $565,000 and financing 60% of the purchase. Her lender is charging a one-point loan origination fee and two discount points. Can you help Faye calculate the dollar amount for points she’s going to pay on her loan?
a. $10,170
b. $16,950
c. $4,520
d. $6,780

575) Jansen and his listing agent just left the closing on Jansen’s house. What kind of notice does Jansen, his agent, the buyer, and the buyer’s agent have regarding the sale of Jansen’s house?
a. Actual notice
b. Constructive notice
c. Legal notice
d. Personal notice

576) Dale and Barbara, your buyer clients, aren’t thrilled about the current interest rates on home loans. They opt to pay two discount points to their lender to bring down their monthly payment. They’re financing $235,000 on their new $400,000 home, so how much can they expect to pay for points at closing?
a. $2,350
b. $3,300
c. $4,700
d. $8,000

577) Why are lenders required to provide the Loan Estimate and Closing Disclosure forms to loan applicants and borrowers?
a. Because interest rates may rise if the buyer doesn’t close on time
b. So borrowers can compare loans and make decisions regarding the affordability of loans offered
c. So government entities can track the numbers of borrowers who decline certain types of loans
d. So they can collect information about loan applicants and borrowers

578) While walking around the exterior of a rural home she’s inspecting, Juanita noticed a metal vent pipe sticking out of the ground 25 feet from the house. She documents this because it may be a sign of what potential environmental hazard?
a. Capped well
b. Radon vent system
c. Septic system
d. Underground storage tank

579) What factors directly affect an adjustable rate mortgage?
a. Amortization tables, index, and rate
b. Index, tax basis, and margin
c. Rate, index, and margin
d. Rate, loan-to-value ratio, and index

580) Sondra thinks the new business contract she signed with her business partner is valid. Both parties are legally competent, the contract has a legal purpose, an offer was made and accepted, and a fee has been negotiated and documented. Which essential element of a valid contract has Sondra not yet considered?
a. Whether consent was voluntary
b. Whether the contract has been translated into all possible languages
c. Whether the contract is in writing
d. Whether the parties are over 21

581) The only element Sondra hasn’t considered is whether the consent to enter into the contract was voluntarily given. Only real estate contracts have to be in writing, and parties are legally competent to enter into contracts from the age of 18.
582) Danette hasn’t paid the first quarter water bill on her property. It was due on April 1. She’s closing with the buyer, Jason, on April 1. What type of expense is this and how will it appear on the settlement statement?
a. This is an accrued expense, and will appear as a buyer debit and a seller credit.
b. This is an accrued expense, and will appear as a seller debit and a buyer credit.
c. This is a prepaid expense, and will appear as a buyer debit and a seller credit.
d. This is a prepaid expense, and will appear as a seller debit and a buyer credit.

583) Shira bought a condominium in a planned unit development. The development has a small playground, tennis and basketball courts, and a putting green. Who owns these recreational facilities?
a. The businesses located in the PUD
b. The condo owners
c. The development investors
d. The PUD developer

584) Joe gave land to a school, but still wanted to have some control over its use, so a deed was prepared that gave the school title as long as the land is used for educational purposes. What type of interest does the school have?
a. Fee simple conditional
b. Fee simple determinable
c. Fee simple subject to a condition subsequent
d. Legal life estate

585) Ashton, an appraiser, is estimating value using the sales comparison approach. He applies more weight to two comparables over several others he used. What process is he utilizing?
a. Averaging
b. Bracketing
c. Conformity
d. Correlation

586) Through a correlation process, the most weight may be given to one or two comparables, or equal weight may be given to all. The term reconciliation is often synonymous with correlation.
587) Casey signed a contract form offering a purchase price of $309,000 on a home, and gave his agent a $5,000 earnest money deposit. The owner is out of town and her agent can’t reach her. At this point what does Casey have?
a. An executory contract
b. An implied contract
c. An offer
d. A voidable contract

588) Sandra is purchasing a home for $200,000 and provides a $3,000 earnest money check to the seller. Her closing costs and down payment total $7,000. Assuming that Sandra is financing the purchase, how much should she bring to the closing?
a. $2,000
b. $3,000
c. $4,000
d. $5,000

589) Alexandra sells her house to Clark for $178,000. They negotiate to split the transfer tax, which has a rate of $0.33 per $100. What do they each pay to cover the transfer tax?
a. $29.37
b. $293.70
c. $58.74
d. $587.40

590) Joan is representing the buyer, Carlton, and Reggie is representing the sellers, Zeb and Teresa Martin. Carlton’s Great Aunt Matilda has agreed to pay any portion of Joan’s commission the sellers don’t cover. Teresa’s father, Teddy, has agreed to pay half of the sales commission that will be owed to the listing agent. Which of these statements is true?
a. Carlton and the Martins are the agents’ principals in this transaction.
b. Matilda and Teddy are the agents’ principals in this transaction.
c. Reggie’s clients are Zeb, Teresa, and Teddy.
d. Since she’s paying Carlton’s share of the commission, Matilda is Joan’s client.

591) What’s a typical prepaid item that will go into a seller’s credit column and a buyer’s debit column on a closing statement?
a. Broker fees
b. Loan fees
c. Property taxes
d. Recording fees

592) Related to the legal test of a fixture, in the acronym MARIA, what do the two As stand for?
a. Acceptability of the fixture and agreement of the parties
b. Adaptability of item and accessibility to the property
c. Adaptability of item to land’s use and agreement of the parties
d. Allowable use and acceptable use

593) Which of these is NOT one of the ways in which an agency relationship may be terminated without penalty for either the agent or the principal?
a. Delaney signed a buyer’s representation agreement with Martha. After Delaney made an offer on a house, she changed her mind and terminated the agency agreement.
b. Martha listed Sonja’s home for sale. Martha helped Sonja negotiate an offer and performed the other tasks required of her. The closing has taken place.
c. Phyllis listed her home with Brad. Brad put the property on the MLS, but Phyllis hasn’t heard from him in more than two months.
d. Richard listed Ole’s ski chalet for sale. Two weeks later, an avalanche destroyed the property.

594) Which statement best describes an adjustable rate mortgage?

595) Helen is purchasing a home for $150,000 and provides a $2,500 earnest money check to the seller, which will be applied to her down payment. She’s financing the transaction, and her closing costs and down payment total $4,800. How much should Helen bring to the closing?
a. $2,300
b. $2,700
c. $4,800
d. $7,300

596) Which task is NOT the responsibility of an escrow officer?
a. Determine how earnest money is to be distributed in case of a dispute.
b. Manage transaction documents from all parties.
c. Prepare closing documents and manage the closing meeting.
d. Verify funding of the buyer’s loan.

597) Which of these is NOT a likely features of a bridge loan?
a. Amortized loan paid back over a period of no more than five years
b. Interest-only loan
c. Secured by the borrower’s existing home
d. Temporary, short-term loan

598) Following all of the client’s lawful instructions describes which fiduciary duty?
a. Disclosure
b. Loyalty
c. Obedience
d. Reasonable skill and care

599) Georgina is an escrow agent who’s holding funds for several transactions. Which of these statements about how she’ll disburse these funds is true?
a. If the transaction closes, Georgina will disburse the earnest money to the listing broker as part of his commission.
b. If the transaction closes, she’ll refund the earnest money to the buyer, since the buyer brings the full amount necessary for the down payment and loan costs to closing.
c. If the transaction doesn’t close, Georgina will disburse the earnest money as instructed by the parties or according to state law.
d. If the transaction doesn’t close, Georgina will refund the earnest money to the buyer.

600) A prospective buyer is curious why a previous owner is selling such a perfect home. The licensee knows that the previous owner recently died due to complications from AIDS. How should the licensee respond to the prospective buyer’s inquiry?
a. The licensee can disclose that the owner had AIDS, but can’t reveal whether the owner died from the disease.
b. The licensee can obtain permission from the seller to reveal the previous owner’s AIDS diagnosis.
c. The licensee can share that the previous owner died from AIDS.
d. The licensee can’t disclose that a previous owner had HIV or AIDS.

601) Broker Sam has extended an offer to licensee Jane, who has accepted the offer. Jane will work as an independent contractor for Sam. Based on this, which of the following statements is true?
a. As an independent contractor, Jane will not have to fill out any tax-related or IRS-related paperwork.
b. It is up to Jane whether or not she wants to have taxes withheld from her pay. If she does choose to have taxes withheld, she must complete a W-4.
c. Jane will need to fill out a W-4 for tax withholding information.
d. Jane will need to fill out a W-9 for IRS reporting purposes.

602) You’re showing your buyers a house that clearly has a second-story addition. What important thing do you need to find out from the sellers?
a. How much the seller’s heating and cooling bills went up after the addition was put on
b. Whether or not a licensed general contractor did the work
c. Whether or not the addition was permitted
d. Whether or not the materials used match the original construction

603) Shemar owns a starter home a few miles outside of the city center, and he wants to deed it to his grandson, Tyler. According to the paperwork Shemar had drawn up, Tyler will own the property as long as he continues to pay the property taxes on time. After the second missed property tax payment, ownership would revert to Shemar. What did Shemar place on the deed?
a. CC&Rs
b. Deed condition
c. Deed covenant
d. Deed limitation

604) Gus has applied for a home equity line of credit from his federally insured bank so that he can make some renovations to his kitchen. The same bank is his lender for his home mortgage. Will this loan be subject to Real Estate Settlement Procedures Act requirements?
a. No, because Gus won’t be using a real estate professional.
b. No, because there’s no transfer of title involved.
c. Yes, because RESPA applies to any residential loan transaction from a federally insured financial institution, including equity lines of credit.
d. Yes, because the bank is also the lender for his home mortgage. If he’d used a different lender, RESPA would not apply.

605) Chip is a residential and commercial agent. His friend asks him to list his cattle ranch for sale, but Chip’s never listed an agricultural property before. How should Chip handle this listing so he can still work for his friend but also not work outside his area of expertise?
a. Disclose to his friend that he’s not an agricultural expert and ask his friend’s permission to work with an agricultural expert in his firm.
b. Refer the listing to an agricultural agent and ask his friend to keep him informed of the transaction’s progress.
c. Take the listing and apply commercial real estate practices, since agricultural sales are similar to commercial sales.
d. Turn down the listing, citing his lack of experience in agricultural work.

606) Tiers in the rectangular government survey system are formed by ______.
a. Parallel baselines
b. Parallel principal meridians
c. Parallel range lines
d. Parallel township lines

607) SARA is an amendment to which environmental act?
a. CERCLA
b. Clean Air Act
c. Clean Water Act
d. Environmental Responsibility Act

608) Rhonda purchased an existing pet store in her neighborhood, and she’s so excited! Her animal-loving aunt is thrilled for Rhonda but disappointed that she won’t be able to visit the store in her wheelchair, as the aisles are narrow and there isn’t enough room to move around. What is true about Rhonda’s responsibilities to her aunt and other people with disabilities?
a. At a minimum, Rhonda is required to add an accessible bathroom.
b. At a minimum, Rhonda is required to add an accessible entrance to the building.
c. Because Rhonda purchased a retail business, she must meet the same ADA requirements as new construction buildings.
d. Since Rhonda purchased an existing building and business, the ADA requirements aren’t as strict as with new construction and vary by building.

609) Related to reasonable accommodation of being allowed to have an assistance animal, which statement is true?
a. If the disability for which the tenant is making the request is obvious, the landlord may not ask why it is needed.
b. If the disability is not obvious, the tenant must provide the landlord with full medical records to support the request.
c. The landlord is not obligated to consider the request unless the tenant can produce either the original or a certified true copy of the animal’s service certification.
d. The landlord must consider the request but may require an additional “pet” security deposit.

610) Henry submits an offer on a condo and includes an earnest money check for 10% of his offer, which the seller accepts. Later on at closing, he brings a cashier’s check for $34,450 (comprising the remaining half of his 20% down payment and $7,950 in closing costs). What’s the condo’s purchase price in whole dollars?
a. $132,500
b. $265,000
c. $344,500
d. $88,333

611) Subtract the closing costs from cashier’s check amount ($34,450 – $7,950=$26,500) for half of down payment. The total DP was double this ($53,000). Next, divide $53,000 by 20% (to find purchase price ($53,000 ÷ .2=$265,000). Purchase price is $265,000.
612) What’s the estimated value by cost approach for a property if the site value is $25,000, the new cost of improvements is $100,000, and the total depreciation estimate is $15,000?
a. $110,000
b. $115,000
c. $140,000
d. $90,000

613) An appraiser used the cost approach to estimate a property’s value at $220,000. The site value was $50,000, and the total depreciation estimate was $4,000. What was the estimated cost of improvements?
a. $166,000
b. $174,000
c. $266,000
d. $274,000

614) Dean’s new business venture is a software services firm where IT professionals handle programming and customer service tasks for a number of business clients. His employees all work at tables in an open office space. Dean most likely has a _______ lease for the office space.
a. Gross
b. Loft
c. Percentage
d. Triple net

615) The best way to start comparative market analysis data collection is to use properties that sold when?
a. 18 to 24 months ago
b. Between two and three years ago
c. In the last 12 to 18 months
d. No later than three to six months ago

616) Why is proof of ownership required when transferring real property?
a. It places the new owner’s name on the deed.
b. It provides evidence that the title is marketable.
c. It provides proof that property taxes have been paid for the property.
d. It verifies the property address.

617) Tom and Martha live in a neighborhood where lawn ornaments are prohibited. They want to put up a nativity scene at Christmas and argue that the covenant doesn’t apply to temporary decorations but only to permanent ones. Their homeowners association disagrees. Which entity enforces subdivision covenants?
a. The civil court system
b. The homeowners association
c. The municipal code enforcement agency
d. The original developer of the neighborhood

618) At what point must a listing agent disclose material facts to all parties involved in the transaction?
a. As soon as possible
b. If asked directly by a party to the transaction
c. Never
d. Only with the seller’s permission

619) Which of these situations might be addressed by limitations or a subject to clause in the deed Jane is using to convey property to Moira?
a. An easement runs across the property, permitting Jane’s neighbors to access the neighborhood boat dock.
b. Jane has given Moira 24 hours to accept delivery of the deed.
c. Jane wants to limit her liability for any title defects that may occur.
d. Moira’s acceptance of the deed is subject to receiving her financing

620) Most often, what’s the first course of action for disputed home warranty claims?
a. Arbitration
b. Condemnation
c. Litigation
d. Mediation

621) Gabe’s home has an assessed value of $172,000, and his tax rate is .55%. What are the annual taxes?
a. $1,125
b. $1,265
c. $935
d. $946

622) First you have to convert the percentage to a decimal. .55% = .0055, so multiply the assessed value by the tax rate to calculate annual taxes: $172,000 × .0055% = $946.
623) Which of the following is an acceptable ad based on Regulation Z?
a. Get a low interest rate of 4.75% (4.925% APR) with as little as 10% down payment and a 30-year fixed rate with no points.
b. Get a low interest rate of 4.75% on a monthly payment of $900.
c. Get a low interest rate of 4.75%, with 85% loan to value.
d. Get a low interest rate of 4.75% with as little as 3% down.

624) Citytown officials know that they have an abandoned factory site that has been identified for cleanup under CERCLA. When city officials tried to trace the ownership of the property, they found several shell corporations but can’t determine which individual or corporate entity actually owns the property. What is a likely outcome of this situation?
a. Citytown will apply to the CERCLA trust fund for cleanup costs.
b. Citytown will bill the EPA for cleanup costs.
c. Citytown will end up paying for cleanup.
d. The factory site won’t be cleaned up and will sit empty.

625) Quentin brought an application before city council to build a shopping mall on 17 acres south of town that currently don’t have a zoning designation. The council referred him to the planning commission, which will review the application in light of the city’s ________.
a. Comprehensive plan
b. Economic development plan
c. Health and sanitation ordinances
d. Zoning ordinances

626) Since the parcel isn’t currently zoned, zoning should be established in alignment with an area’s comprehensive plan.
627) Belinda is a licensee whose client asked her to draft an addendum containing complicated terms that even Belinda doesn’t fully understand. Belinda should ______.
a. Avoid unauthorized practice of law
b. Hire an attorney
c. Refuse to work with this client
d. Use legalese

628) Which act sets guidelines for public and common use areas at housing developments?
a. Accessibility Options Act
b. Americans with Disabilities Act
c. Fair Housing Act
d. Multi-Family Dwelling Act

629) Sebastien’s four-story home includes a 400-square-foot unfinished bonus room on the top floor, an upper level with 850 square feet, a main level with 1,450 square feet (which includes a garage that’s 500 square feet), and a finished basement that’s 900 square feet. The MLS system in Sebastien’s area includes below-grade square footage. What square footage will be reported on his MLS listing?
a. 2,200
b. 2,700
c. 3,600
d. 4,100

630) Sebastien should exclude the unfinished bonus room and the garage and add the remaining area (850 (1,450 – 500) 900).
631) Your buyer, Billy, wants to make an offer on the craftsman house he saw today, but he wants the sellers to start the paperwork for a tax reassessment before closing. This isn’t part of the standard sales contract in your area. What will you use to accomplish this request?
a. Addendum
b. Amendment
c. Annotation
d. Appendix

632) Joaquin sold his house for $327,600. He bought it several years ago for $139,900 with a $100,000 loan. The loan balance when he sold it was $73,400. What was Joaquin’s equity?
a. $114,300
b. $187,700
c. $214,300
d. $254,200

633) Kelly is closing on the house she’s purchasing on Wednesday. Which of these statements is true?

a. Kelly must receive the Loan Estimate at least four days before closing.
b. The closing officer must deliver the Closing Disclosure at closing.
c. The lender must provide the Closing Disclosure by Friday of the week before closing.
d. The Loan Estimate amounts must be within 1/4 of a percent of the final settlement costs.

634) Gerald practices real estate in a state that recognizes sub-agency. Which of the following statements is true of Gerald’s authority to appoint a sub-agent?
a. He can independently appoint a sub-agent at any time during the transaction.
b. He must receive the principal’s permission in writing in order to appoint a sub-agent.
c. Only Gerald’s broker can appoint a sub-agent.
d. Only the principal can appoint a sub-agent.

635) How many acres are in a parcel described as, “The S 1/2 NW 1/4 Section 3, Township 4N, Range 2W of the 6th PM”?
a. 160
b. 20
c. 40
d. 80

636) If a community isn’t growing in an orderly fashion, which local land use group is likely at fault?
a. Downtown business association
b. Planning board
c. PTA
d. Zoning board of appeals

637) Tracy is looking in the MLS and sees a listing marked “REO.” Which of these statements regarding REOs is correct?
a. An REO property is one that the lender is trying to help the owner sell before beginning foreclosure proceedings.
b. Banks acquire REOs through failed foreclosure sales or deed in lieu of foreclosure actions.
c. REOs are properties that the lender has given permission to sell for less than the loan amount.
d. REOs refer to investment properties a bank owns.

638) Melisa’s mother gave her house to Melisa, along with a signed copy of the deed granting ownership to Melisa. Years later, Melisa decides to downsize by selling the property. The title company shows that the property is still in Melisa’s mother’s name. What does Melisa have to do to clear this up?
a. File a suit to quiet title.
b. Present the signed deed to the new buyer.
c. Present the signed deed to the title company.
d. Record the signed deed.

639) What’s a good policy that a buyer’s agent should employ regarding contingencies?
a. Avoid contingencies because they tend to put sellers off.
b. Maximize the number of contingencies allowed.
c. Use a standard set of contingencies with each buyer to avoid missing any.
d. Use contingencies judiciously to protect the clients and the deal.

640) Alice owned a double lot on the waterfront. She sold the lot to Ronesha and included a deed restriction prohibiting construction of any building taller than one story. Ronesha wants a three-story house. What should she do?
a. Apply to the zoning board of appeals for a variance.
b. Check to see if the building code will permit a larger house.
c. Conform to the deed restriction.
d. File a suit against Alice to have the restriction removed.

641) What type of arrangement allows the buyer to retain title to the property, but places a security interest in the property on behalf of the seller?
a. A straight-term loan
b. Land contract
c. Purchase money mortgage
d. Wrap-around mortgage

642) Tristan’s offer has been signed by all parties and delivered back to the seller. This means that ______ has occurred.
a. Acceptance
b. Binding acceptance
c. Notarization
d. Personal delivery

643) Compared to conventional loans, what are typical characteristics of construction loans?
644) An __ contract or agreement is one that exists based not on words, but on the parties’ actions or behaviors.
645) __ consist of agreements in which the terms are stated by the parties. The terms may be stated orally or in writing. But the contract as a whole must reflect the intention of the parties.
646) The Equal Credit Opportunity Act is designed to prevent discrimination in ______.
647) __ asks the court to force the opposing party into a contract that binds them to actually perform the contract at issue, rather than award damages for breach of contract. In real estate litigation, a buyer can force a reluctant seller to live up to the purchase and sale agreement.
648) __ are typically voluntary liens. Voluntary liens are placed on the subject property with the consent of the owner. This is usually done through the loan documents (mortgage and promissory note).
649) When a loan is recasted, what does it essentially become?
650) Which of the following may be used to defer paying taxes when there is an almost immediate repurchase of what’s called a “like-kind” property?
651) What is a clear zone?
652) When it comes to advertising in real estate, a __ is an established zone created to prevent safety hazards and unsightly advertising.
653) ______ is a leasehold estate of definite duration that terminates automatically and is inheritable.
654) Sandra enters a contract to sell her home to Paul. Under the statute of frauds, the written contract must name the contracting parties, identify the subject matter of the contract, and ______.
655) What is a capital gain?
656) For an investor, purchase price plus closing expenses is known as ___________________.
657) Your client, Lee, a foreign investor, is selling his property and learns a 15% withholding of the sales price will be imposed. Why is this?
658) The requirement is two of the last five years, and the exclusion is up to $250,000 for single taxpayers and __ for couples filing jointly.
659) The __ is a person who applies for a mortgage and makes a home purchase on behalf of another. The actual buyer may be someone with bad credit who is unable to qualify for a mortgage themselves, or a scam artist looking to profit by manipulating the mortgage and real estate transaction process.
660) A __ typically has no right of survivorship. This means that if A and B are tenants in common of Blackacre, and A dies, A’s share does not to go B. Rather, A’s share goes to the party selected in A’s will.
a. tenancy in common

661) Kevin, your buyer client, signed a contract to buy Lydia’s home. The contract states that “time is of the essence.” You correctly advise Kevin that this means ______.
662) Ensuring land is put to the use for which it is best suited while also protecting livability of a community and property values is achieved through ______.
663) The local planning and zoning commission is reviewing multiple applications at this week’s meeting. Which of the following new developments is likely to be reviewed relative to a mixed-use zoning ordinance?
664) A __ lease is usually for a large open space that may have few amenities.
665) A __ is the “embryo stage” of a land purchasing process that analyzes and determines if the property is practical for the planned use of the land. This task can also include reviewing all aspects of the property from both a financial and environmental perspective as well.
666) A __ is a legal proceeding that asks the court to remove any claims, or “clouds,” against the title so that it can be conveyed.
667) Terry has a costume shop in a commercial building. He has a one-year lease that automatically renews for another year unless either Terry or the landlord terminates. What type of leasehold estate is this?
668) __ does impact property values and may be perceived as infringing on personal rights; therefore, public opinion is sought before zoning changes are made.
669) In an amortized mortgage, the monthly payment is the same each month. While the portion used to pay interest decreases over time, the portion used to repay principal ______________.
670) Edgar is in the process of selling his home in a short sale. What’s a short sale?
671) ______ is allowed to perform appraisals on any type of real estate.
672) Frank took out a mortgage from First National Bank in order to purchase a new home. In a lien theory state, who or what retains the title to the property?
673) Which type of property management situation requires a license?
674) According to the Telephone Consumer Protection Act guidelines, who or which entity may call a person listed on the Do Not Call Registry?
675) With an interest-only payment plan, ______.
676) Which term involving trespassing is used when someone other than the owner claims title to real property?
677) Which of the following is true about pocket listings?
678) What type of contract is one in which the terms of the agreement and consideration to be exchanged are defined in words, whether verbally or in writing?
679) A landlord locks a tenant out and requires the tenant to pay past-due rent before regaining access to the unit. This is considered ______.
680) Which activity requires a license?
681) In addition to residential and commercial real estate sales, King County Realty has an active residential property management department. The firm rarely holds earnest money on sales transactions, so it has a single trust account for earnest money and security deposits. The firm ______.
682) How do you decide which party you represent in a transaction?
683) What is a margin, as it relates to an adjustable rate mortgage?
684) Your client, Brian, is an investor who likes to put as little cash down on his investments as possible. Brian believes in the power of ______.
685) In order to be enforceable, what does the statute of frauds require a real estate contract to be?
686) What is usury?
687) Stanley is having second thoughts about taking his neighbor to court over a written agreement they have concerning who pays the rent on a storage unit that they share, because it’s used to store stolen merchandise. Stanley doesn’t think the contract will stand up in court. What type of contract does Stanley have?
688) What brokerage activities can Austin perform if his license is inactive?
689) Seller Darlene wants to know when she’ll be paid the full amount of the purchase price for her property. What should you say?
690) Three friends entered into a contract to buy a vacation property. The friends got into a dispute, resulting in one of them wanting out of the deal. The remaining two friends didn’t want to lose the deal, but couldn’t afford it on their own. They talked a fourth friend into replacing the person who backed out of the contract. The seller agreed to the substitution, and they moved forward with the purchase. What does this describe?
691) Cheryl wants new carpeting for her rectangular living room. Her living room is 18 feet by 12 feet. How much carpeting does she need?
692) What’s alienation with regard to real estate?
693) One regulatory requirement says that a broker has a specified amount of time to provide copies of transaction documents to a managing or designated broker. How long is this window of time?
694) Carlos, a property manager at Your Best Bet Property Management Company, manages multiple properties for their owners. Which of the following statements is true?
695) When you refuse to screen prospective buyers based on their ethnicity, your client, Matt, “fires” you as his agent, and you agree to his decision to part ways. Do you still owe this guy any fiduciary duties?
696) Liz listed her property with an agreement end date of May 31. The property went under contract on May 12, and the buyer’s earnest money was deposited on May 13. Based on the home inspection results, the buyer legally terminated the contract on May 20. When did the listing agreement between Liz and the listing broker officially terminate?
697) Curtis is having second thoughts about taking his partner to court over a written agreement they have concerning the purchase of a rental property. Curtis doesn’t think the contract will stand up in court because the partner is only 17 years old. What type of contract does Curtis have?
698) The appraiser applies a capitalization rate to an income comparison of similar properties with which of the four methods used to measure depreciation?
699) Janice’s life tenant, Jacob, is currently living on her property. Once Jacob dies, Janice has arranged for the property to be given to the School for the Gifted. What interest does the School for the Gifted currently have?
700) James creates a trust to hold a piece of real estate he owns. He directs a corporate fiduciary to hold title to the real estate and provides instructions for the management, control, and disposition of the real estate upon his death. Given that the trust only holds real estate, James likely set up a(n) ______ trust.
701) Which entity is responsible for deciding the general layout of a specific municipality —a city, town, or village—and mapping the zones and the uses allowed within each zone?
702) What’s the purpose of a brief adjudicative hearing?
703) What is the purpose of an operating budget?
704) Janie’s got an open house scheduled for Sunday, but lets her friend in on Saturday to preview it. It’s love at first sight! With the owner out of town, Janie decides to cancel the open house so there won’t be any other offers. Her friend makes an offer and it’s accepted on Monday. What fiduciary duty or duties has Janie breached?
705) During the closing, whose job is it to deliver the title commitment after ensuring the title is marketable and without defect?
706) Isabella is thinking about buying a one-bedroom residence in a cooperative. A residence in a cooperative, unlike a condominium, is considered ______.
707) What is the term for paying off a loan over time?
708) Maria’s neighbor is building a shed in his backyard that appears to be about a foot over the property line into her yard. What term describes the placement of the shed on Maria’s property?
709) The Jeffersons would like to sell their home. However, they had their home painted last year and never paid the contractor. The contractor has placed what type of lien on the home?
710) Which of these is an example of a lot and block description?
711) Which term refers to the division of community land into designated districts on a map that includes a text description defining the uses permitted under each classification?
712) What’s a vendee’s lien?
713) The Consumer Financial Protection Bureau ______.
714) The government’s power to take private land for public use is called ______.
715) A tenant is entering into a 12-month agreement with an owner of an upscale apartment complex to rent an apartment. What type of contract will be used to identify the rental arrangement’s terms?
716) Dual agent Barbara Park can only disclose Seller Carrie’s reason for moving if:
717) Which term is used when someone claims someone else’s property by using it for an extended period of time?
718) Which of the following is a residential dwelling with shared walls where the owner also typically owns the land on which the home sits?
719) The ______ provides administration and enforcement of federal fair housing laws.
720) –
721) Which liens take priority over all other liens?
722) What form should be provided to borrowers no fewer than three days prior to closing?
723) Which of the following statements about agents and the duty of obedience is true?
a. An agent can ignore a client’s instructions if they negatively affect the agent’s commission.
b. An agent should carry out the client’s instructions as long as they are within the law.
c. An agent should never question a client’s instructions.
d. The duty of obedience extends beyond the termination of the agency agreement.

724) What does REO stand for?
a. Real estate office
b. Real estate owned
c. Rental equality ownership
d. Rental equal opportunity

725) What does the rectangular government survey system use as the basis for legal descriptions?
a. Principal meridians, base lines, and sections
b. Reference to a subdivision plat
c. Reference to degrees latitude and longitude
d. The beginning point of a boundary line as identified by a surveyor

726) Randi is a licensee who would like to update her advertising. What must she be sure to include on any advertising listed with her or any other brokerage?
a. Brokerage name
b. Fax number
c. Franchise logo
d. Personal photo

727) Seller Randy signed a listing agreement with Barbara, who worked very hard to find him a buyer. Randy’s cousin decided to purchase the house during the listing period. Is Barbara owed a commission?
a. No, because sellers don’t have to pay a commission if a relative purchases the property.
b. Yes, because Randy is not a licensee.
c. Yes, because she worked hard for Randy.
d. Yes, if she has an exclusive right-to-sell agreement.

728) Mario doesn’t want to include a religious preference in his listing ad, so which of the following phrases should he use?
a. Apartment available for members of attached temple
b. Close to Catholic cathedral
c. Jewish community
d. Within walking distance to a mosque

729) Homeowners can take several actions related to pest infestations, but which of the following actions should be left to licensed pest management professionals?
a. Applying pesticides
b. Installing a vapor barrier
c. Looking for sings of an infestation
d. Removing moisture from the home

730) Which of these transactions would require the Missouri licensee to provide written disclosure of his or her interest?
a. Henry is the listing agent for a vacant property in the condo complex where he lives.
b. John is the listing agent for his neighbor’s house.
c. Sally is the buyer’s agent for a couple that was referred to her by her previous client.
d. Step is her father’s buyer’s agent.

731) Which of the following is true about an attorney’s opinion of title?
a. It protects buyers from material defects.
b. It’s no longer required anywhere.
c. It’s the document that notes the cloud on the title.
d. It uses public records to validate property transfers.

732) What’s designed to protect buyers from financial loss if the title to the property they buy has defects?
a. Abstract of title
b. Chain of title
c. Title insurance
d. Title search

733) When considering buying property subject to an existing lease, it’s critical to understand the lease terms, including the lease duration, rent amount, renewal/purchase options, and the __________________.
a. Lease start date
b. Property management responsibilities
c. Security deposit amount
d. Tenant’s occupation

734) Which of these may be covered by a builder-backed home warranty?
a. Custom exterior paint
b. Owner-installed landscaping
c. Ugly carpeting
d. Workmanship

735) Jasper has a new listing, and he appoints Esther as his sub-agent. Esther brings Julie, a buyer customer, to the transaction, and Julie buys Jasper’s listing. What’s true about the agency relationships in this situation?
a. Esther owes her loyalty to the seller
b. is the sub-agent to Esther.
c. Jasper is the sub-agent to the seller.
d. Julie is the sub-agent to Jasper.

736) Heath leases space in a commercial building for his sporting goods store, and the building owner insisted on having Heath sign a percentage lease. Under the terms of a percentage lease, Heath must pay ________.
a. All of his net income to the property owner
b. A percentage of his sales to other tenants in the building
c. A percentage of his sales to the property owner
d. A percentage of the rental rate of charity

737) With which type of government power can a lien be placed on a property, giving the government a claim to the property?
a. Eminent domain
b. Escheat
c. Police power
d. Taxation

738) The Johnsons are shopping for a mortgage loan and are attracted to the below-market interest rate offered for the first year of an adjustable rate mortgage. What’s this type of rate called?
a. Bait and switch
b. Balloon payment
c. Fixed rate
d. Teaser rate

739) At a business meeting among heads of the top brokerages in town, the keynote speaker discussed a minimum listing fee. What’s this is an example of?
a. Group boycotting
b. Market allocation
c. Price fixing
d. Tie-in arrangement

740) The tax associated with property taxes is relatively stable and a high revenue generator because ______.
a. No one is exempt from paying property taxes
b. People enjoy paying taxes
c. Property values tend to remain stable over time
d. Taxes are always increasing.

741) A fee a lender charges for processing a loan is called _______.
a. A buydown
b. A loan origination fee
c. A loan servicing fee
d. An appraisal fee

742) The Knolls are purchasing a property and are concerned about the title. They want to have a title search performed. Who can perform a title search?
a. A property inspector
b. A title insurance company
c. The Knolls
d. The Knolls’ real estate agent

743) What type of emails are prohibited by the CAN-SPAM Act?
a. Customer service emails
b. Emails containing more than three hyperlinks or attachments
c. Junk emails
d. Subscriber emails.

744) Clara signs a net lease for office space. Under a net lease, she’ll be responsible for ________.
a. A portion of the property’s operating expenses.
b. Cleaning the property’s common areas herself.
c. Ensuring the parking areas are well lit and safe.
d. Paying for repairs to the property’s foundation.

745) Charles is selling his home to Sheila. Charles has an existing loan that he will continue to make payments on. Charles is also extending credit to Sheila for the balance of the purchase price. Sheila will make monthly payments to Charles. What type of financing is used in this transaction?
a. Home equity loan
b. Loan amalgamation
c. Refinance
d. Wrap-around loan

746) Which of the following equals one furlong?
a. 16.5 feet
b. 220 yards
c. 2.47 acres
d. 7.92 inches

747) Which of the following is considered an act of discrimination under federal fair housing laws?
a. Renting only to Catholics
b. Renting to a married lesbian couple
c. Renting to a white man who has good credit
d. Showing a property to qualified buyers only

748) Compared to working without a buyer agency agreement, a buyer who works under a buyer agency ?
749) Switches that are warm to the touch, damaged panels, and lights that dim or flicker when other appliances are in use can be signs of a(n) ______ problem.
750) What is the purpose of the Consent for Dual Agency form?
751) What types of leases must be recorded?
752) Which of these is an example of a rectangular survey system description?
753) Jorge is a dual agent in a single-license dual agency situation. He owes his clients all of the following fiduciary duties EXCEPT ___________.
754) Shelly buys Mark’s house, which is still in an option period with Monique. Monique decides to exercise her option after Shelly moves in. What will happen?
755) Your client exchanged one property for a similar property and did not have to pay capital gains taxes that year. How did he do this?
756) Soundproofing and decorative material, shingles, and siding may contain what hazardous material?
757) Jay’s new loan to purchase a property includes the seller’s existing mortgage. This type of loan is called a ______ loan.
758) What is one drawback of a real property transfer?
759) When assigning a contract, the assignor should ensure that ______ is not prohibited in the purchase contract.
760) You’re trying to impress your neighbors, who are considering selling their house. You’d like to get the listing. They ask you about a listing your firm has that’s been on the market forever. Why isn’t it selling, they want to know? You answer:
761) Which of the following occurs when a property owner dies without having a will in place, and no heirs or creditors can be found?
762) To effect a transfer of title by deed, _________________ must occur.
763) When operating under a power of attorney concerning the transfer of real property, who may sign in place of the principal?
764) Carla Ricardo asks the landlord if she could be let her out of her lease early. The landlord agrees to let her out of her lease, no strings attached. Carla and her landlord have decided to terminate the contract through _________________.
765) Single agency is _______.
766) Which of the following closing activities occurs on the day of closing?
767) In relation to appraisals, what’s a “federally related transaction”?
768) First-time homebuyers can access up to $________ of their Roth IRA accounts, penalty-free, under certain conditions.
769) Which of the following is the best definition of a covenant between a lessor and lessee?
770) Which of the following is a material fact that must be disclosed to prospective buyers?
771) The National Fair Housing Alliance believes in promoting the message that __________ neighborhoods are stronger neighborhoods.
772) Which of the following can indicate drainage problems?
773) Which of the following are landlords required by law to ensure?
774) A deed must be ______________ before it can be recorded.
775) What type of agency exists because a written or oral agreement is in place?
776) Which act introduced the “innocent landowner” defense that states that a landowner isn’t responsible for clean-up of contamination that occurred prior to their ownership, provided they have not tried to cover up the contamination and can prove due diligence in investigating the property when it was purchased?
777) Which of the following terms best describes real property?
778) In the sales comparison approach, the appropriateness of the various comparable sales in relationship to the subject is considered in a process known as ______, where certain factors may be given more weight.
779) What is the definition of a testator?
780) You are meeting with prospective clients in person for the first time. What are you required by law to explain to them?
781) Which of the following is true?
782) What type of tenancy can be automatically created if a tenant under a lease stays beyond the lease’s terms, and the landlord continues to accept rent from that tenant?
783) What might the financial implications be if a buyer needed to use individual retirement account funds toward a down payment?
784) Kip is a sub-agent working with a buyer customer, Charlie, for Sheila’s listing of May’s property. To whom does Kip owe his loyalty?
785) When a lower-quality property is adjacent to a higher-quality property, it can diminish the value of the higher-quality property. What economic principle is this?
786) –
787) Which portion of a mortgage payment is the financial institution’s charge for the use of its money?

a. Insurance
b. Interest
c. Principal
d. Tax

788) What’s it called when a person who has possession of a property through a life estate abuses the property or allows it to deteriorate?

a. Act of waste
b. Escheat
c. Estate at sufferance
d. Reversionary interest

789) Which ownership type involves one person owning the property?
a. Co-ownership
b. Dual ownership
c. Estate in severalty
d. Property partnership

790) Which of the following is designed to protect buyers from financial loss if the title to the property they buy has defects?
a. Abstract of title
b. Chain of title
c. Title insurance
d. Title search

791) When people are treated differently because they were born in another country or are from a specific part of the world, this is discrimination based on _______.
a. Color
b. Familial status
c. National origin
d. Race

792) You’re obligated to preserve all the confidential information you receive from a seller client. This obligation ______.
a. Can be ignored if you’re sharing confidential information with someone other than the buyer
b. Ceases once the seller’s property is sold
c. Continues even after your fiduciary relationship with the client ends
d. Ends 30 days after you’ve received the confidential information

793) REEB automatically suspended the licensee’s real estate license when the board found the licensee guilty of which of these offenses?
a. Cynthia, a salesperson, accepted a commission payment from her buyer client.
b. Jeannie, a salesperson, failed to properly remit an earnest money deposit she received.
c. Teresa, a broker, failed to disclose to the buyer a property defect that her seller client told her about but didn’t want to disclose.
d. Tom, a real estate licensee who works in property management, denied a rental application from Ram and Aarthi Ramesh because of their race.

794) Which one of the following elements of a deed signify the grantor’s intention to transfer title to the grantee?
a. Act of conveyance
b. Consideration
c. Evidence
d. Grantor/grantee

795) The transfer tax rate is $0.37 per $100. A property that sold for $300,000 would have a ______ transfer tax.
a. $1,110
b. $1,200
c. $2,200
d. $920

796) How does discrimination still occur, even though it’s illegal?
a. Discrimination is human nature.
b. Discrimination is often not visible to the public.
c. Discrimination makes good business sense.
d. Not all laws make sense.

797) As a property manager, Darby expects to _______.
a. Charge tenants for maintenance calls
b. Have the property owner reimburse her for expenses
c. Include free lawn care service
d. Pay some expenses out of pocket

798) Which type of estate conveys all rights of ownership?
a. Fee simple estate
b. Leasehold estate
c. Legal estate
d. Life estate

799) Alexandra is perusing her closing statement, particularly those amounts that are a benefit to her. What’s the term for these items?
a. Benefits
b. Credits
c. Debits
d. Favorables

800) You’ve signed a listing agreement with a client. Which of the following activities will you address next in order to complete the sales process for your listing?
a. Deposit the earnest money check.
b. Hold an open house.
c. Prepare a features list.
d. Publish the MLS listing with photos.

801) Which stage of the property ownership life cycle can be affected by income tax issues?
a. Acquisition, ownership, and reversion can all be affected by income tax issues.
b. Only acquisition
c. Only ownership
d. Only reversion

802) How can an agent offer dual agency legally?
a. By getting general agreement from both parties
b. By having clients sign waivers
c. By not disclosing one of the agency relationships
d. By obtaining informed consent in writing from both parties

803) Which type of contract involves an exchange of consideration between two parties?
a. Bilateral
b. Executed
c. Mutual
d. Unilateral

804) A clause that allows the parties to agree that they won’t litigate if there are any contract disputes is a/n _________.
a. Arbitration clause
b. Choice of law clause
c. Indemnification clause
d. Severability clause

805) Conrad and Evan have been renting their house in Green Bay for several years. The end of their current lease is approaching, and the couple wants to continue renting the home. Which of the following is true of the lease arrangement they will enter into with their landlord?
a. They can simply extend the lease they are currently in.
b. They must enter into a new lease.
c. They must go on a month-to-month lease.
d. They must pay a renewal fee to the state.

806) What is the definition of a tax lien?
a. A tax lien can be attached to a property as a result of an unpaid mortgage.
b. A tax lien can be attached to a property for a violated covenant restriction.
c. A tax lien can be attached to a property for work performed on a property by a contractor.
d. A tax lien can be attached to property for failure to pay any type of taxes, including property taxes and income taxes.

807) What figure results when you subtract the buyer credits from the buyer debits on the closing statement?
a. The amount the broker will distribute on behalf of the buyer
b. The balance due from the buyer at closing
c. The balance due to the seller at closing
d. The buyer’s total expenses and fees

808) Roger just discovered that his loan includes a hidden balloon payment, so now he must ________.
a. Make one large final payment to pay off the principal
b. Make one large initial payment to pay down the principal
c. Pay off the interest with a second mortgage
d. Pay off the interest with higher payments for the first year

809) Mario does not want to include a religious preference in his listing ad, so he decides to use which of the following phrases?
a. Apartment complex with a temple
b. Close to Catholic cathedral
c. Jewish community
d. Within walking distance to a mosque

810) Juniper is buying a newly constructed home with a fireplace and garage. A _______ is required, per state laws.
a. Carbon monoxide detector
b. Radon test
c. UST
d. Well inspection

811) Seller Julius knows he has asbestos in his insulation, and he wants to remove it before listing his house. What’s Julius’s best option for removal?
a. Hire an odd jobs contractor
b. Hire someone with proper and training and certification
c. Leave it for the buyer to deal with it
d. Remove the insulation himself

812) A listing agreement describes how compensation the seller’s agent earns will be shared with the licensee who brings the buyer. This is known as the _______.
a. Buyer’s split
b. Cooperating broker’s split
c. Honor system
d. Office fee

813) Fred wants to make sure that his home is radon free. He wants to check all likely access points, including which of the following?
a. Doorways
b. Drains
c. Outlets
d. Windows

814) Ralph has a right of first refusal agreement on his neighbor’s property. When the property goes up for sale, how will Ralph exercise his right?
a. He’s allowed to review and refuse any offer the seller would like to accept, giving him control over who lives next door.
b. His neighbor isn’t allowed to market the property until Ralph has decided to either purchase the property at market value or give up his right of first refusal.
c. His neighbor must notify Ralph as soon as he receives his first offer, giving Ralph the opportunity to match the offer and buy the property. If Ralph doesn’t do so, he gives up his right of first refusal.
d. Ralph is allowed to refuse any material change to the property, including a sale, lease, or substantial change to the property improvements.

815) Which of the following is an example of a deed restriction?
a. Eminent domain
b. EPA wetland conservation guidelines
c. Fence height
d. Zoning regulation

816) A property manager is authorized to perform all of the duties related to the property on whose behalf?
a. The lender’s
b. The owner’s
c. The state’s
d. The tenant’s

817) uyer Yun-Wah is purchasing a property for $400,000. His loan-to-value ratio is 80%. The lender also charges a one-point loan origination fee. How much will his loan origination fee be?
a. $2,400
b. $3,200
c. $3,600
d. $800

818) What’s the area of a rectangular building that’s 40 feet by 20 feet?
a. 800 feet
b. 800 square feet
c. 80 feet
d. 80 square feet

819) Karen wants to sell her lakeside vacation home. Upon visiting for the first time in six months, she discovers it flooded during the rainy season. She should have the property checked for _______.
a. Formaldehyde
b. Lead-based paint
c. Mold
d. Radon

820) Al is a real estate licensee. Assuming that none of the following people are his clients but are parties to a potential transaction, to whom must he provide an agency disclosure form?
a. Any party
b. Only buyers
c. Only sellers
d. Only tenants

821) REALTOR® Jim wants to become a social media influencer to get his name out there as an exceptional real estate professional. Why might this be a good idea?
a. It isn’t; NAR prohibits REALTORS® from becoming social media influencers.
b. Social media platforms are exempt from license law.
c. The Code of Ethics doesn’t apply to social media, so he can get away with more ruthless marketing tactics.
d. Used the right way, it can be a great way to find clients.

822) What is it called when a seller removes an item or fixture from a property (so that it becomes personal property instead of real property) before an agreement of sale has been signed or after negotiations have commenced?
a. Adaptation
b. Annexation
c. Detachment
d. Severance

823) Which of the following is something the seller is required to disclose to a buyer in a transaction?
a. Any and all offer amounts from other buyers.
b. The kitchen drain often clogs and backs up into the sink.
c. The seller has HIV.
d. The seller’s willingness to offer seller financing.

824) Which of the following is a duty that licensees owe to ALL parties in a transaction?
a. Exercising reasonable skill and care
b. Negotiating on a party’s behalf
c. Placing a party’s interests first
d. Protecting confidential information

825) Which of the following is a reason that wetlands are protected?
a. To be developed at a later date
b. To grow commercial crops
c. To open them to commercial fishing
d. To stabilize soil and help control erosion

826) What’s an encumbrance?
a. A claim on property that limits the owner’s use or rights, or decreases the property value
b. A defect on the property found during inspection
c. An unauthorized claim to property
d. Anything that affects the marketability of a property

827) Felicity doesn’t mind if her listing firm represents potential buyers of her home, but she would prefer that her listing agent only represent her in the transaction. What type of agency relationship should she select in her residential listing contract?
a. Designated agency only
b. Multiple representation relationship with designated agency
c. Multiple representation relationship without designated agency
d. Rejection of multiple representation relationships

828) Vanessa has just returned $200 to a former tenant whose security deposit was $800. What else, if anything, must she do?
a. She doesn’t have to do any of these things.
b. She must send a letter to the tenant that confirms the end of the lease in writing.
c. She must send the tenant an itemized statement that details how the missing money was spent.
d. She must use the missing $600 to fix the damage caused by the tenant’s normal wear and tear.

829) In terms of encumbrances, what’s a license?
a. Permission to alter someone’s land or property
b. Permission to do something on another’s land while also possessing an interest or ownership in the land
c. Permission to do something on one’s own land
d. Permission without possession, interest, or ownership

830) Shelly is a landlord and places an advertisement for her apartment complex saying, “Bienvenido! These Spanish-style apartments are perfect for the Spaniard in you.” Is this a fair housing violation?
a. No, because as the property owner, Shelly can advertise as she likes
b. No, because it appeals to a certain style of housing
c. Yes, because it’s discriminating based on national origin
d. Yes, because Shelly doesn’t know for a fact that the housing is Spanish-style

831) What’s the term for an addition to a sales agreement form that can be added before it is signed without changing any of the other terms that have already been agreed upon?
a. Addendum
b. Amendment
c. Annexation
d. Appurtenance

832) Ella, a listing agent, accidentally discriminated on the basis of familial status by using which statement in her advertisement?
a. “Families will love it here!”
b. “Features a cozy fireplace.”
c. “House located on quiet street.”
d. “Offers a spacious family room.”

833) Which of these is a requirement when licensees present a party’s written proposal to their client?
a. Ensure the client’s decision is given to the party in person.
b. Ensure the party is promptly notified of the client’s acceptance; rejection doesn’t require notification of the party.
c. Present the client’s decision to the other party within 24 hours of receiving the written proposal.
d. Promptly notify that party of their client’s decision.

834) Which of these statements regarding the purpose of real estate governance is the most accurate?
a. Real estate governance organizations are created primarily to ensure that licensees have the appropriate education and experience before becoming licensed.
b. Real estate licensing law is in place to assure that brokers treat licensees equitably.
c. States enact licensing laws to ensure that licensees are well-qualified and that they act within the law.

835) Lease types, space planning, area design, and building layout are especially important for a property manager who’s working with a ______.
a. Condominium property
b. Non-residential property
c. Residential property
d. Vacation property

836) What responsibilities does a real estate professional have regarding property taxes?
a. Assist with paying property taxes at closing
b. Determine whether property taxes have been correctly assessed
c. Testify at property tax hearings
d. Understand how property taxes are calculated and disclose to buyers what their property taxes will be based on true taxes, not assessed value nor taxes after exemptions are taken

837) Licensees conduct CMAs to determine ______.
a. An appropriate listing price
b. Appraisal value
c. Construction costs
d. Multiple methods

838) Listing agent Paula receives three offers for the property overnight and finds them in her inbox first thing in the morning. How should she handle them?
a. For any offers that a buyer has submitted directly, she must first verify the source. Those that come from other agents should be presented to the seller promptly.
b. She must present them one at a time in the order received, according to the time stamp on the email. The seller must make a decision on the offer before she presents the next one.
c. She should present them all promptly to the seller for review.
d. She should present them promptly to the seller unless the seller already has an offer under consideration. If so, she must hold all other offers until the seller has made a decision.

839) A home sells for $225,000. Per the listing agreement, the total commission is 7% of the sales price. The listing brokerage will split the full commission with the buyer’s broker 50/50. Kiko the seller’s listing agent has a 70/30 split arrangement with her brokerage, with Kiko receiving the “70”. After sharing the commission with the buyer’s broker and her commission split with her brokerage, how much will Kiko receive?
a. $15,750
b. $2,362.50
c. $5,512.50
d. $7,875

840) Determine which of the following statements is TRUE when an as-is clause is used.
a. Sellers are exempt from lead-based paint disclosure requirements.
b. Sellers are required to fill out Real Estate Condition Reports.
c. Sellers have no disclosure obligations.
d. Sellers must still disclose any potential material adverse facts.

841) What do buyers provide to the seller as an indication that they are serious and intend to go through with the purchase?
a. A copy of the signed agency agreement
b. A promissory note
c. Earnest money
d. Their word

842) To avoid discriminating against those with disabilities in her advertisements, June, a listing agent, should use which of the following phrases?
a. Fourth-floor walk-up
b. Ideal for active singles
c. No service animal allowed
d. No wheelchairs on premises

843) Lenders require that borrowers purchase and maintain adequate _____, which is usually bundled into their monthly PITI payment.
a. Hazard and flood insurance
b. Legal counsel
c. Personal property insurance
d. Pest and hazard inspections

844) Where is an appropriate place for a broker to place client trust funds?
a. In an interest-bearing account within the state, with a ledger entry noting they are trust funds
b. In a non-interest-bearing general business account
c. In a trust fund account or neutral escrow account
d. In the broker’s personal checking account

845) You should make sure that any property management agreement you sign has _______ that outlines why and when you have the right to terminate a contract with an owner.
a. A hold harmless clause
b. An activation clause
c. A reasonable care clause
d. A termination clause

846) REEB has received information that leads the board to believe that a broker has pursued a continuing course of mortgage fraud. Which of these statements about the board’s authority is true?
a. REEB may issue a summary suspension pending a disciplinary investigation and hearing.
b. REEB may petition the attorney general’s office for a temporary injunction against the broker.
c. REEB must give the licensee an opportunity to appear at a hearing before taking any action against the licensee.
d. REEB must schedule a show cause hearing before beginning an investigation or commencing any disciplinary action.

847) The potential for health hazards related to ______ must be disclosed when selling or renting homes built before 1978.
a. Arsenic
b. Asbestos
c. Lead
d. Radiation

848) Which law requires the EPA to establish air quality standards?
a. The Clean Air Act of 1970
b. The Clean Air Act of 2010
c. The Environmental Quality Act of 1970
d. The EPA Air Quality Standards Act

849) In which type of contract does only one of the parties offer consideration?
a. Bilateral
b. Executed
c. Mutual
d. Unilateral

850) Which of the following is a private agreement that impacts the use of the land?
a. Assessment
b. Deed restriction
c. Encroachment
d. Encumbrance

851) John is a qualified third party conducting a standard review of a property. John is conducting a(n) ______.
a. Analysis
b. Inspection
c. Review
d. Test

852) Lester, a confirmed bachelor, decided to celebrate the fact that he just made the final payment on his home in Oshkosh. He invited several friends over for a “burn the mortgage” party. How does Lester own his home now?
a. As chattel
b. As tangible property
c. Encumbered
d. In severalty

853) Jerome is buying Joanne’s bungalow in Kenosha. Both parties decided they would prefer a title agent hold the earnest money prior to closing. In what type of account is the earnest likely to be deposited?
a. Broker’s operating account
b. Escrow account
c. Mortgage account
d. Trust account

854) A late spring snow melt caused a river to swell past its bank. The flooding led to many landowners losing portions of their properties. What is the process called that caused this land loss?
a. Accretion
b. Avulsion
c. Erosion
d. Prior appropriation

855) Wanda wants to use some copyrighted material on her website. The law _______.

a. Allows her to legally use up to 15% of the original work
b. Offers no rules permitting the use of a specific number of words or percentages of a work
c. Permits her to use whatever she wants
d. States that she can legally use 300 words

856) Which of the following describes a timeshare?
a. Non-transferable property
b. Property with a divided form of ownership or use rights that is usable during defined periods
c. Real property that can be used at any time
d. Theoretical property
857) When can real estate agents give legal advice to a buyer about backing out of a contract?

a. An agent should never give legal advice unless the agent is also a practicing and licensed attorney.

b. They can give legal advice any time.

c. They can give legal advice any time they are asked by the buyer, if the information is provided orally.

d. They can give legal advice any time they are asked to do so by the buyer, and they provide the information in writing.
858) Raj wants to protect some of the equity in his home in case of bankruptcy or foreclosure. He should file a(n) _____.

a. Equity Protection form

b. Foreclosure waiver

c. Homestead exemption

d. Security Interest form

859) A claim of misrepresentation can stand up in court if it includes ________ elements.

a. Five

b. Four

c. Three

d. Two
860) The ______ form is used to form the type of contract that only binds the seller, who must not sell the property to anyone else during the specified time period. The buyer, on the other hand, isn’t bound by the contract.
a. WB-1
b. WB-11
c. WB-24
d. WB-35

861) Hilary just learned that some of the repairs the seller was going to make on the house she is buying in the Milwaukee suburbs will not be completed before closing. Rather than delaying the closing, what can Hilary and the buyer do?
a. Draft a post-closing escrow agreement with instructions for how the seller will pay for the repairs.
b. Hilary can hire her own contractor to finish the repairs and send the seller the bill.
c. Nothing, Hilary will have to pay for any repairs that are not made before closing.
d. Require the contractor to work overnight to complete all repairs.

862) Levinia is preparing a sales contract for her clients Rose and Lily. When is it acceptable for her to offer them legal advice?
a. Never
b. When covering the options for terms and contingencies
c. When determining the purchase price amount
d. When discussing the amount of earnest money to place as a down payment

863) What’s the term for paying off a loan over time?
864) What occurs when a tenant moves out because an issue with the unit makes the unit uninhabitable, such as a lack of heat in the winter?
865) What’s true of a contract amendment once it’s signed by both parties to the transaction?
866) What term is used to describe the illegal use of escrow funds, such as earnest money?
867) Serena works in the property management department of a large apartment complex. For which of the following tasks would she be required to hold a real estate license?
868) When preparing a property for showing, which of the following is true?
869) Sam the appraiser is most likely to use the cost approach for which of the following properties?
870) Why might a buyer want to assume a loan?
871) Leading up to closing, who should ensure that all deadlines are being met, all contingencies are cleared, and all paperwork is fully executed and delivered?
872) Which of the following responsibilities does the commercial property manager have that the residential property manager doesn’t have?
873) Which mortgage market is made up of lending institutions that lend directly to the consumer?
874) Which IRS forms are independent contractors and employees required to complete?
875) Lacey is preparing an offer for her buyer clients, and it’s time to fill in the amount of earnest money they’re going to offer. Which of the following statements is true regarding what earnest money the buyers should offer?
876) Jamie enters an agreement to buy Yolanda’s home. Per the agreement, Jamie promises to provide a $5,000 earnest money deposit, whereas Yolanda promises to sell her home to Jamie. These promises represent forms of ________, which are required to make the contract valid.
877) As supply increases, price ______.
878) Which of these statements about licensee cooperation is true?
879) Which term describes a contract in which the parties have met all agreement terms?
880) Which type of REIT receives most of its revenue from rental of their properties?
881) Government tax assessment offices determine the _________________ by comparing similar properties in a geographic area.
882) Dawn and John own a home together, but they’re getting a divorce. They agree that John will keep the house and assume the loan they signed together. Will the alienation clause in their security document prevent the assumption?
883) The process the government uses to take someone’s property is called __________.
884) The designated broker for Jennifer’s firm left the firm without warning. Can Jennifer and her fellow licensees continue to provide brokerage services?
885) Abe signs a contract to buy Penelope’s home. The deal eventually closes, but Penelope fails to hand over the home’s keys to Abe. A week passes, and Abe files a lawsuit in an attempt to force Penelope to give him the keys. This is an example of ________.
886) Archie wants to buy Claire’s membership share in a cooperative. Which of the following statements is true?
887) A line of credit that’s based on a percentage of the equity a person has in a property and which can be drawn upon for a number of years is known as a ______.
888) Which of the following statements about the duties that seller and buyer clients owe to their agents is true?
889) Janie’s got an open house on Sunday but lets her friend in on Saturday to preview it. It’s love at first sight! With the owner out of town, Janie decides to cancel the open house so there won’t be any other offers. Her friend makes an offer and it’s accepted on Monday. What fiduciary duty or duties has Janie breached?
890) What must you disclose to be in full compliance with an agent’s fiduciary duty to disclose?
891) How should you respond to a buyer who says the following? “I know that you technically can’t show me just the white neighborhoods, but I’m paying for your help. My time is valuable, and I don’t want to waste it going to showings in neighborhoods I don’t want to see. If you won’t screen properties for me the way I want you to, I’ll find someone else who will.”
892) When preparing the sales contract, when is it acceptable for a licensee to offer legal advice to the client?
893) Which option is a right guaranteed under the Privacy Act of 1974?
894) After selling your first house, you decide to cash the commission check yourself, and then give a bonus to your licensed assistant. What type of violation have you committed?
895) What’s the purpose of police power?
896) Trinity is 18 and wants to be a managing broker in Washington. She has completed the required 90 hours of coursework. What else might prevent her from taking the managing broker’s licensing exam?
897) Place the stages of the loan approval process in the correct order.
898) What’s the term for a contract for which one or more terms have yet to be completed?
899) The DOL director received a complaint against broker Carl Savage and has decided to investigate. What’s the next step in the process?
900) You prepared a comparative market analysis and have a plan for educating the seller about the value you can provide. Which stage of the residential sales process are you in?
901) What’s a legal description?
902) Jacob and Cynthia are purchasing a house from Carlos. They want to be protected from having to purchase the house if they find substantial property condition defects. What can they do with the contract to protect themselves?
903) Which of the following is an example of the duty of obedience?
904) Prior to closing on the property, Monica substituted her daughter’s name, Melanie, as the buyer. Although Melanie is now listed as the buyer, Monica isn’t released from her contractual obligations. This is an example of ______.
905) According to the Federal Communications Commission, who or which entity may call a person listed on the national Do Not Call Registry?
906) Why would a retail tenant be willing to sign a lease in which a percentage of sales proceeds are paid to the landlord?
907) What type of agency exists when a buyer’s broker is the listing agent for the same property?
908) Which term refers to a tract of land divided into lots or plots and used for building purposes?
909) How are independent contractors compensated and their income reported?
910) Which of the following statements is true about a licensee’s duties to a landlord the licensee represents?
911) A property owner’s right to access ponds, lakes, oceans, and other closed bodies of water bordering the owner’s land is called ______ rights.
912) Melissa, a new broker, is excited to meet with her first seller. She knows she needs some sort of form to outline her agreement with the seller. What should she do?
913) Renatta is under contract to sell her home to Marcus. Marcus has a financing contingency, and he finds that he’s unable to get financing for the home. He terminates the contract under this contingency. Renatta’s brokerage firm is holding the earnest money. What is their responsibility regarding disbursement of those funds?
914) You represent Cynthia and Ronald, who signed a contract to buy Margie’s home. The contract included the phrase, “time is of the essence.” You explain to Cynthia and Ronald that this phrase means ______.
915) The installment land contract is what type of financing?
916) A real estate licensee can provide which of the following opinions?
917) The secondary mortgage market is comprised of _________________________.
a. FNMA, GNMA, FHLMC, & lending institutions that buy loans from other lenders
b. Lending institutions that lend directly to consumers
c. Savings and loans, thrifts, and credit unions
d. The VA and the FHA

918) Which document is provided to borrowers no fewer than three days prior to closing and provides disclosures about the costs of the transaction?
a. Closing Disclosure
b. Escrow Closing notice
c. Loan Estimate
d. The Mortgage Servicing Transfer disclosure
e.
919) Which document given before closing provides an estimate of the costs a buyer is likely to pay at settlement?
a. Abstract of title
b. Closing Disclosure
c. Loan Estimate
d. The Mortgage Servicing Transfer disclosure
920) If a lead-based paint risk assessment or inspection reveals hazards on the property and the seller refuses to fix the problem, what options does the buyer have?

a. The buyer can declare the contract null and void or remove the contingency and continue with the purchase of the property.

b. The buyer can report the seller to the EPA and force the seller to make the repairs or serve jail time.

c. The buyer can sue the seller for breach of contract.

d. The buyer has only one option and that is to back out of the contract.
921) How much notice must a tenant give if they want to terminate their lease?

a. 30 days
b. It depends on the type of tenancy.
c. Three weeks
d. Two weeks
922) Elisa and Simone signed an agreement to list Simone’s house for sale. After the contract was signed, Simone lost her job, and her father, George, offered to help Simone out by paying Elisa’s commission. The buyer’s agent, Carl, also reduced his commission by a quarter of one percent to help Simone out. Who is Elisa’s client?

a. Carl
b. Carrie
c. George
d. Simone
923) Renae showed a property to a Shannon, a buyer client, then to another client later that week. The second client made an offer and the seller accepted. The next day, Shannon called Renae to make an offer on the property and was angry that Renae showed it to another buyer. Did Shannon have a case?
a. No. Renae hasn’t violated agency law by showing the same property to two separate buyer clients.
924) How does the building department ensure that a builder who has obtained a permit builds according to code?
925) When must informed consent for dual agency be obtained?
926) When a local planning board is reviewing density, it would consider ______.
a. Federal impact
b. Impact on neighboring states
c. Property values
d. Setbacks and boundaries
927) What regulation or regulatory authority identifies sites that have hazardous substances, and requires the responsible parties to clean them up?
928) Agatha helped her client Rufus complete the form that documents Rufus’s purchase offer to the seller for the property he’d like to buy. What is this form?
a. Buyer representation agreement
b. Listing agreement
c. Promissory note
d. Sales contract

929) Which of the following is an example of positive misrepresentation?

a. An agent knowingly made a false statement that caused harm.
b. An agent made an unintentional error that resulted in a positive outcome.
c. An inadvertent error occurred.
d. It results in a positive outcome.

930) What type of violation are you committing when you fail to include a material fact or make false or misleading advertising statements?
a. Conflict of interest
b. Improper brokerage commission
c. Improper delivery of instruments
d. Misrepresentation
931) Although Kirk has been paying rent toward his ground lease for more than 17 years, he will never be able to buy the lease from the landowner. What type of ground lease does Kirk have?
a. Assumable
b. Irredeemable
c. Non assumable
d. Redeemable

932) Dan is buying Chuck’s property, which is listed with Nevin’s brokerage. Who are the parties to the exclusive right-to-sell listing agreement?
a. Chuck and Nevin’s brokerage
b. Dan and Chuck
c. Dan and Nevin
d. Dan, Chuck, and Nevin

933) Which formula calculates net to seller?
a. (Net amount mortgage or other expenses) / (100% ‒ commission rate)
b. Sales price ÷ (100% – commission rate)
c. Sales price – (100% – commission rate)
d. Sales price x (100% – commission rate)

934) Which of the following terms best describes an item that is both a fixture and real property?
a. Built-in
b. Chattel
c. Free-standing
d. Movable
935) To indicate that they understand and consent to the terms that appear on each page of the sales contract, what are the seller and buyer required to do?
a. Check the “We understand and consent to the terms presented on this page” statement.
b. Initial and date the bottom of each page of the contract.
c. Nod their heads ‘yes.’
d. Sign a consent form.

936) A negotiable instrument must contain an order to pay or a ________.
a. Flexible sum of money
b. Hand written signature
c. Notary stamp
d. Promise to pay

937) Offers become binding contracts when they’re ______.
938) Cari is preparing an operating budget, and it shows a net loss. What should she do?
939) What is tortious interference?
940) Which of the following statements is true regarding conventional loans?
941) Genevieve is a licensee interested in purchasing a new home. She found the perfect place, which happens to be listed by the brokerage where she’s affiliated. What must she do if she intends to purchase the property?
942) What pricing strategy could work well in any market, primarily by generating buyer interest?
943) Why is it important for a company to revisit its objectives periodically?
944) A(n) _______ is an independent contractor who’s an employee by statute for certain employment tax purposes. An example is a food delivery driver who’s paid on commission.
945) A ____________________ is a worker who’s classified by the common understanding of the profession. An example would be a food server.
946) Georgette is meeting with her buyer clients to fill out the purchase and sale agreement. Which of the following must be true?
947) You’re writing an offer for your buyer client in a cold market. What would be a good negotiation strategy?
948) What’s it called when a real estate company establishes policies and procedures designed to keep confidential information secure, particularly regarding in-house transactions?
949) The buyer and seller are prorating property taxes. Step one is to calculate the daily rate. Next, the number of_________ is multiplied by the daily rate to get the prorated amount.
950) When evaluating the income listed on a loan application, what will the lender consider?
951) Not wanting to cause the sellers or mortgage lenders unnecessary concern, Gwen, the buyer’s agent, wasn’t exactly forthcoming about a slight change in her client’s financial status that her client had shared with her in confidence. Which fiduciary duty to the customer is Gwen violating?
952) What determines how frequently an interest rate adjusts in an adjustable rate mortgage?
953) Which of the following is an example of what would be included in a mission statement?
954) You’ve just accepted a new listing. Why would you want to view the details of past listings for this property?
955) Liam is buying Abigail’s home. Per their agreement, Liam promises to buy the home for $325,000, and Abigail promises to sell her home to Liam. These promises represent forms of ______, which are required to make the contract valid.

956) Jacob and Alexa have decided that they’ve had enough of city life and it’s time to move to the county. Which of the following should be included in the listing agreement they sign with Carla?
957) When preparing a purchase agreement, when is it appropriate for a licensee to offer legal advice to the client?
958) What’s the best way to describe your sphere of influence?
959) Terry just passed her licensing exam, and she’s been working with a broker for the last two months. So far, though, she doesn’t have any clients. How can she spend her time most productively?
960) Which of these is the best definition of a property’s market value?
961) Which entity guarantees government loans?

962) Of the benefits of seller agency, which is the most important to convey to a seller?
963) When you interview with a broker, which of the following goals should your questions help you confirm?
964) You have a duty of honesty and fairness to customers. You have a duty of obedience to your clients. What happens if a client asks you NOT to be honest about a material fact related to the property?
965) What’s a residential marketing plan?
966) Jan is a listing agent assisting the Chesters with the sale of their home. What is one of Jan’s duties?
967) When performing a market analysis, you’ll want to evaluate the number of houses on the market in a given price range and region. What is this data point called?
968) In Janie’s comparative market analysis, comparable A has an adjusted price of $118,000, comparable B has an adjusted price of $112,500, and comparable C has an adjusted price of $121,300. What would be a good way to use this data?
969) What is the purpose of the seller net sheet?
970) Stella is looking for a good broker with whom to affiliate. She begins her search by identifying brokerages located in a particular area. Which of these would be most important in terms of location?
971) Which of the following statements about using real estate assistants is true?
972) Minimizing risk in part means avoiding public networks, unsecure sites, and ______ sites.
973) Which of the following is the best piece of advice you would give to a licensee for avoiding legal concerns over any contract?
974) If you’re alone at an open house, what should you never post online?
975) Broker Janelle is deciding on an office location for her new firm. The main purpose of the office will be to meet with customers and clients. Where can she find data about where her prospective clients are located to help her decide on an office location?
976) Matt is representing the Tyler family in the sale of their house. What should he tell them about the property disclosure form?
977) What are vacancy rates, new building permits, inventory rates, and sales volume?
978) Clayton is your seller client, and you’ve provided him with an appropriate list price range for his house. He’s now found another house he’d like to purchase, but he needs to sell his current house before he can make an offer. Should his desire for another property impact pricing strategy?
979) Jose, a listing agent wants to write an ad for his new listing. Which of the following phrases is acceptable under fair housing guidelines?
980) Benji is a buyer’s agent, and he’ll receive a split of the commission paid from the sale of Harriet’s listing. The property sold for $425,000. The total commission paid from the sale is 6%, split evenly between the buyer and seller brokerages. Benji has an agreement with his broker that he earns 80% of the commission received. How much will Benji be paid from this sale?
981) To meet legal and ethical standards, all transactional records that you keep should be complete and ________.
982) Built-to-Last Construction, Inc., entered into a contract to build a new home for Jane and Dick Monahan. The contract specified that the home must be completed by June 1. Built-to-Last Construction finished the home on May 28. What’s this an example of?
983) Calculate the housing ratio based on the following information: $1,500 condo payment; $100 association fees per month; $150 monthly student loan payment; $300 car payment (with only four payments remaining); and a gross monthly income of $5,000.
984) Which of the following options describes a method by which a person with a real estate license can determine an appropriate listing price range?
985) In an analysis of comparables, property A is next door to the subject property and had six adjustments. Property B is three blocks away and had three adjustments. Property C is six blocks away and had two adjustments. Property D is one block away and had eight adjustments. Which comparable should carry the most weight in determining a list price range?
986) Your client, Arliss Xavier, insists on finding a buyer who is willing to pay top dollar for her property. You, on the other hand, would like to get the property sold so you can get your commission. What should you do?
987) Camille makes it a point to check the MLS for seller clients’ properties’ former MLS listings. What information will she find there?
988) Can Jeremy, a licensee, receive a referral fee for sending his buyer client to Ajax Title?
989) Marcus is representing a seller client. Which of the following is a true statement?
990) Last week, The Rialdis’ listing agreement ended after months on the market, with not even a single offer to show for it. Today, they received a call from Mindy, a real estate professional who would like to relist the property and has some new ideas for getting it sold. What approach is Mindy using to find listings?
991) What’s the purpose of the loan application?
992) Because of the lack of control over the individual by the employing party, which of the following persons is not classified as an employee?
993) From a seller’s perspective, what’s one reason to use the MLS to promote a property?
994) REALTOR® Randy has a seller client who’s proving difficult to work with, and Randy knows he won’t appreciate the advice Randy needs to give him: The market has cooled and the listing price they agreed to should be lowered. He puts off contacting his client, hoping someone will make an offer in the meantime. Is Randy acting according to the NAR Code of Ethics?
995) Sylvia, who’s suffering from early onset Alzheimer’s, signs a contract to buy Theodore’s home. Before the deal closes, it’s determined that Sylvia lacks legal capacity to enter into a contract. Which party or parties is permitted to void the contract?
996) Why is it important to try to view the world from your client’s perspective?
997) While reviewing her purchase contract, Jeanette’s client asked, “What does this inspection contingency do?” How should Jeanette frame her response?
998) Edmond, a broker, signs a listing agreement with Julia, who’s selling her home. Julia insists that the agreement state that only Christians will be allowed to buy her home. For what reason would this agreement be considered void?
999) The formula for net to seller is sales price x (100% – _______).
1000) Besides building seller rapport, what’s a key purpose of touring a subject property?
1001) Which of the following phrases should Monica include in her new listing ad if she wants to be careful to avoid including a religious preference?
1002) What value principle assumes that if an identical property were sold recently, its sales price should be a good indicator of the value of the subject property?
1003) Which term means a calculated percentage used to determine who owes how much of a given expense over a certain period of time?
1004) Traci is hosting an open house for her seller, Alex. Rashid, a potential buyer, stops by, loves the home, and starts talking with Traci about buying the property. Rashid isn’t working with a broker. How does Traci avoid an undisclosed, unintentional dual agency situation?
1005) In accordance with RESPA prohibitions, rebates may only be offered by licensees to transaction parties, if _____.
1006) Lorena is getting ready to post information about her new listing on social media. Which of the following should she do?
1007) One type of seller financing is a(n) ______.
1008) In most states, tenancy in common is the assumed form of property ownership unless otherwise noted in a contract. Which of the following statements about tenancy in common is also true?
1009) Which of the following is a legitimate business deduction for income tax purposes for a real estate licensee?
1010) Which of the following statements applies to both employees and independent contractors?
1011) What’s the acronym for the legislation that eliminates illegal referral fees among settlement service providers?
1012) If an appraisal contingency is in place, what happens when a property appraises lower than the agreed-upon sales price?
1013) What measurement indicates how many properties are selling in a given area?
1014) Per the Real Estate Settlement Procedures Act (RESPA), licensees may not receive or give referral fees or finder fees (or anything of value) from/to whom?
1015) Where are the top two places you should spend your marketing dollars?
1016) When does express agency exist?
1017) The Real Estate Settlement Procedures Act is a consumer protection statute that ______.
1018) What’s a cooperating broker?
1019) You’re the agent for a 2,500-square-foot property that has four bedrooms, two baths, and a full basement. Your first comparable is a 2,400-square-foot home with three bedrooms, one-and-a-half baths, and no basement that’s listed for $239,000. You adjust the price by $2,500 for the lack of a bedroom, $3,000 for the missing half bath, and $5,000 for the reduced square footage. What is the adjusted price of the comparable property?
1020) Although open houses don’t usually result in the sale of the home, they’re still important. Why?
1021) How does a budget compare to a forecast?
1022) What is another name for a land contract?
1023) Which of the following is a map of a proposed subdivision development that must be approved by the planning commission, before development may begin?
1024) What’s the most common way that buyers’ brokers protect their compensation?
1025) Who’s ultimately responsible for determining the role a licensee is expected to play in any transaction?
1026) Why do licensees help buyers estimate closing costs?
1027) A $400,000 property depreciated in value by 2%. What’s its new value?
1028) To determine the indicated market value of a subject property, which of the following data would be correct to use?
1029) Which buyer negotiation strategy is unlikely to work in a hot market?
1030) It’s not a good idea to post photos of your clients’ expensive belongings. Why is that?
1031) As supply increases, what happens to price?
1032) Denise is a real estate licensee performing a market analysis. She uses the rule of three, which means that she selects three comparables that ______.
1033) What’s your responsibility regarding contingencies when representing a buyer?
1034) Which one of the following best describes the fiduciary duty of confidentiality?
1035) Which of the following are common with hot markets?
1036) Three friends entered into a contract to buy a vacation property. The friends got into a dispute, resulting in one of them wanting out of the deal. The remaining two friends didn’t want to lose the deal, but couldn’t afford it on their own. They talked a fourth friend into replacing the person who backed out of the contract. The seller agreed to the substitution, and they moved forward with the purchase. What does this describe?
1037) What does the Rule of Three say about comparables when preparing a CMA?
1038) As demand increases, what happens to price?
1039) What element of the listing presentation outlines the various ways a licensee will advertise and boost awareness of a seller’s property to potential buyers?
1040) How does the seller agency relationship benefit the seller?
1041) What is closing?
1042) Prior to closing on the property, Monica substituted her daughter’s name, Melanie, as the buyer. Although Melanie is now listed as the buyer, Monica isn’t released from her contractual obligations. What is this scenario an example of?
1043) Which type of worker is defined in statute under tax law as an independent contractor and not an employee, examples of which include direct sellers, licensed real estate agents, and certain companion sitters?
1044) Matt and Elaine are brokers who plan to go into business together, and they’re working on a business plan to present to prospective lenders. Which section will provide a synopsis of the plan?
1045) Jillian just received a trio from a title company. It contains a property profile, deed, and ______.
1046) If a seller receives a full-price offer, which of the following is a true statement?
1047) You represent Cynthia and Ronald, who signed a contract to buy Margie’s home. The contract included the phrase “time is of the essence.” How do you explain to Cynthia and Ronald what this phrase means?
1048) After adjusting sales prices of comparables for a market analysis, which comparable carries the most weight in determining a list price range?
1049) Kathy is preparing a market analysis for her clients, the Winstons. Why might she include a seller net sheet?
1050) The Nguyens must get top dollar. Competitive properties are priced at $250,000 and $255,000. What’s a good pricing strategy?
1051) The _______ orders the title search in an escrow closing.
1052) What’s the purpose of the buyer pre-qualification letter?
1053) Mona is a licensee who strives to be professional in all of her actions, so how does she keep her business account?
1054) Which of the following is a true statement regarding short sales?
1055) Mary is preparing a purchase offer for her buyer client. It’s a fairly standard offer: a little less than list price, with the seller paying a little toward the buyer’s closing costs. Mary fills in the blanks on a standard form used in her brokerage firm based on the current situation. Is this okay?
1056) What is the purpose of a pre-closing checklist?
1057) –
1058) When Shelby had lunch with an old high school friend, he mentioned his new career as a real estate licensee. They spent a few minutes discussing the real estate market, and Shelby’s friend promised to call when he and his wife started looking for a home to buy. Then they continued reminiscing about old times. Is the cost of the meal now an allow
1059) James’s brokerage, Urban Roots, will specialize in urban living spaces. During the situational analysis, he found that the population his brokerage will serve prefers to meet with sales agents virtually. Part of the brokerage’s mission statement is: “Help our customers to find the perfect urban living space in a way that suits their busy lifestyles.” Which of the following should be included in Urban Roots’ plan to address this?
1060) Henrietta makes an offer for $250,000 on Ollie’s bungalow. Ollie has until June 21 to respond to her offer. Before Ollie responds, Henrietta finds a house she likes better, and she withdraws her offer to Ollie. Which of the following is true of this situation?
1061) Which of the following hardware and software configurations is best suited for a brokerage office that will primarily serve as a meeting place for virtual sales professionals?
1062) You’re working with sellers who need to maximize their proceeds. Competitive properties are priced at $370,000 and $375,000. What’s a good pricing strategy?
1063) Nancy is thinking about paying off her mortgage loan early. She looked at the loan contract and found that her lender charges a pre-payment fee based on a percentage of interest paid within six months. The lender charges 80% of six months’ interest. Nancy’s mortgage has $50,000 remaining, and she pays 6% interest. How much would she owe in penalty fees?
1064) An example of confidential information is ______.
1065) Which of the following best describes the purpose of the Truth in Lending Act?
1066) Adam owes $125,000 on his home. It’s currently worth $340,000. How much equity does Adam have in his home?
1067) As a security precaution when posting information for a listing, which of the following should you do?
1068) One reality of real estate is that you’ll often need to ______ in order to make a sale.
1069) In the income capitalization approach to appraisal, NOI is found by ______.
1070) What is a reason a homeowner may seek a short sale?
1071) Peter is a broker with a listing agreement with the sellers, the Averys. Under the terms of the listing agreement, Peter will earn his commission whether he, the Averys, or another brokerage finds a buyer for the property. What type of listing agreement did the Averys sign?
1072) Why is it important to include active comparable listings in a market analysis?
1073) What, when signed by all parties to a sales contract, changes the original terms of the contract ?
1074) After the open house has ended, it’s best to _______.
1075) Your sellers, the McIntoshes, ask you about the MLS and why they should market their house on it. Which of the following would you tell them?
1076) Two types of prorations are _______.
1077) Bart is an independent contractor. Which of these does his managing broker have the right to do?
1078) Abe signs a contract to buy Penelope’s home. The deal eventually closes, but Penelope fails to hand over the home’s keys to Abe. A week passes, and Abe files a lawsuit in an attempt to force Penelope to give him the keys. Of what is this an example?
1079) When interest rates are lowered, real estate purchases become more ______ for buyers.
1080) When looking for a broker with whom to affiliate, an important consideration is to find out if the broker is ___________ .
1081) Under which of the following circumstances might you be advised to refuse to write a listing contract with sellers?
1082) –
1083) What is usually the first place serious buyers look for homes for sale?
1084) Risks to computer systems can be reduced by avoiding public networks, ______ sites, and suspicious sites.
1085) Which of the following is an action that real estate licensees may take without practicing law illegally?
1086) The multiple listing service is a go-to resource for data when researching a subject property. What information will you find there?
1087) Pam is a new real estate licensee who must receive a high level of supervision. Even with the supervisory requirement, the Internal Revenue Service allows Pam to be classified as an ______.
1088) A listing agent’s primary duty to a seller is to ______.
1089) What does a credit score tell a lender?
1090) Which of these is a factor in calculating a consumer’s credit score?
1091) Ginger, a licensee, tours a home that’s packed with clutter. She should ______.
1092) Real property ownersip has significant tax advantages. Which of the following is an advantage?
1093) Ways to minimize computer risks include avoiding public networks, unsecure sites, and ______ sites.
1094) Which of the following describes a sale subject to a mortgage?
1095) Homes built before 1978 may have what environmental hazard in their paint?
1096) Why would a buyer want to know whether any additions or alterations were made to a property?
1097) When a client understands what dual agency is and agrees in writing to allow a firm to act as a dual agent for them in a real estate transaction, this is known as ______.
1098) What is one drawback of sub-agency from a seller’s standpoint?
1099) In a real estate transaction, who may a licensee represent?
1100) Members of the Real Estate Commission serve _________-year terms.
1101) If a consumer wants to file a deceptive ad complaint, which entity should be contacted?
1102) Species habitat, beauty, erosion control, and pollution treatment are all reasons why wetlands are ___________.
1103) Kerry is a real estate licensee who has committed an ethical violation. Which of the following is a true statement about her potential penalties?
1104) One of Mrs. Wilson’s tenants is leaving in a few months. She hates to see this particular tenant go because he has been an ideal tenant—always paying his rent on time, keeping his place clean, and never a complaint. Unlike so many of her other tenants, this tenant deserves to get back his security deposit. By law, when must Mrs. Wilson return the deposit to her tenant?
1105) If a licensee is convicted of a controlled substance offense, what can the Real Estate Commission do?
1106) A buyer asked Clifton why she would benefit from signing an agency agreement with him. Clifton answered: ______
1107) At a business meeting attended by the heads of the top brokerages in town, the keynote speaker discussed a minimum listing fee. This is an example of ______.
1108) What type of agency relationship exists if an agent from ABC Realty represents a buyer and the seller is affiliated with Net Realty?
1109) Article 3 of the Code of Ethics requires NAR brokers to cooperate except
1110) Which term describes the addition of alluvion land to a property through the natural process of accretion?
1111) Which of the following are examples of Single Agency?
1112) Under what name must sole proprietors conduct business?
1113) Glenda is engaged as seller’s agent. Gary, the seller, hasn’t consent to dual agency. A prospective buyer would like Glenda’s assistance in drafting an offer to present to Gary. Can Glenda do this?
1114) The lender, the loan applicant, and the _____________ all complete part of the request forms for verification of deposit forms.
1115) April is having a limited coverage searched performed on her condo. When is a limited coverage search used?
1116) Which Law does the Office of Fair Housing and Equal Opportunity Uphold?
1117) According to the NAR code of Ethics and Standards of Practice Preamble, “REALTORS should recognize that the interests of the nation and its citizens require the ____________.”
1118) Ownership is a right in the bundle of rights. Which of the following is considered a form of ownership?
1119) Which of the following financing types involves the sale of personal property with the real property?
1120) In a transfer of ownership in real property, who conveys the title?
1121) At what level or levels does antitrust oversight exist?
1122) Stephanie’s primary residence is in SC, has a fair market value of $225,000, and is in an area with a millage rate of .325. Stephanie qualifies for the state homestead exemption. What could she expect to pay in property taxes?
1123) Sally is a licensee working under a written brokerage agreement with buyer Barney. Although she’s assisting him in the transaction, he’s her customer (not her client), and she doesn’t owe him any fiduciary duties. Based on this, you know that Sally’s acting as a __________.
1124) –
1125) Which of the following describes the appropriate capital gain exclusion for a taxpayer’s primary residence?

— ++—0ceshop0 principles—5.3.23—
1) What is the California Department of Real Estate responsible for?Top of Form
a. Advertising listings in California
b. Connecting consumers with real estate licensees
c. Regulating the real estate industry
d. Valuing real property in California
2) Where can California real estate law be found?
a. Code of Civil Procedure
b. Family Code
c. In the Business and Professions Code
d. Revenue and Tax Code
3) How many members make up the Real Estate Advisory Commission?
a. 10
b. 12
c. Four
d. Six
4) What does the Real Estate Advisory Commission do?
a. Determines real estate policy and issues regulations to enforce law
b. Discusses real estate policy and makes recommendations to the Commissioner
c. Issues real estate licenses
d. Values real property in California
5) Which of these describes the composition of the California Department of Real Estate Advisory Commission?
a. Top of Form
b. Eight members, seven of whom are unlicensed consumers and one who is a licensed real estate broker
c. Six members, all of whom must be real estate brokers with at least five years of experience
d. Ten members, six of whom are real estate brokers and four who are unlicensed consumers
6) What is the role of the Real Estate Commissioner?
a. Act as chief executive officer of the California DRE
b. Advise the governor on personal real estate dealings
c. Preside over real estate cases in court
d. Value properties listing for sale or rent in California
7) What is the goal of real estate law?
a. Limit activities real estate professionals can perform
b. Limit the services consumers can obtain from real estate professions
c. Promote the interests of real estate professionals
d. Protect and promote public safety, health, order, and welfare
8) What is the difference between real estate law and Regulations of the Real Estate Commissioner?
a. Real estate licensees only need to follow the law, not the regulations.
b. Real estate licensees only need to follow the regulations, not the law.
c. Regulations are used to enforce and clarify the law. Real estate licensees must abide by both.
d. The law governs real estate licensees, whereas the regulations govern California DRE activities.
9) How many members on the Real Estate Advisory Commission are unlicensed consumers?
a. Eight
b. Four
c. Six
d. Ten
10) How is an individual selected to act as Real Estate Commissioner?
a. A public vote
b. The individual is appointed by the governor
c. The individual is selected by the attorney general
d. The Real Estate Advisory Commission holds a vote
11) How are members selected to serve on the Real Estate Advisory Commission?
a. They are appointed by the governor
b. They are appointed by the Real Estate Commissioner
c. They are elected by former Real Estate Advisory Commission members
d. They are elected in a public election
12) Which of the following actions can an individual holding only a prepaid rental listing service (PRLS) license perform?
a. Listing properties for rent
b. Negotiating lease agreements on behalf of the landlord
c. Negotiating lease agreements on behalf of the tenant
d. Providing listings of residential properties available for rent to prospective tenants for a fee
13) Jim would like to sell his own home. What is the minimum real estate license he must possess?
a. Associate broker
b. Broker
c. None
d. Salesperson
14) Which of the following properties is considered a manufactured home?
a. A structure transported in three units and built in 1975 on a permanent foundation
b. A structure transported in two units and built in 1975 on a permanent chassis
c. A structure transported in two units and built in 2005 on a permanent chassis
d. A structure transported in two units and built in 2005 on a permanent foundation
15) What must be true for a corporation to conduct real estate activities?
a. All officers must hold a broker license
b. All officers must hold a salesperson license
c. At least one officer must hold a broker license
d. At least one officer must hold a salesperson license
16) Consuela is a real estate licensee, and she has three other licensees working under her supervision. What type of license does Consuela hold?
a. Associate broker
b. Broker
c. Office manager
d. Salesperson
17) Jimbo doesn’t yet have a real estate license. Which activity is he legally allowed to perform without one?
a. Give advice to a friend who is negotiating the purchase of a house.
b. List a friend or family member’s home for sale for a fee.
c. Negotiate the sale of a house for two friends and receive a tip as thanks.
d. Receive payment for managing real estate.
18) Edwina has a California salesperson license. Which of these statements is true?
a. She must associate with a broker in order to perform any real estate activities.
b. She must obtain a broker’s license before she can perform any real estate activities.
c. She’s allowed to perform a limited set of real estate activities with this license.
d. She’s allowed to perform all real estate activities, and may choose to work as an individual licensee or to associate with a broker.
19) –
20) In which of these scenarios does the consumer need a real estate license?
a. Jessie is searching for a new home for a friend moving into town, who will compensate her 2% of the sale price for her time and effort.
b. Mickey is selling his own home and isn’t using the services of a listing agent.
c. Peter is helping his sister, Kristen, find a new apartment and will not be compensated in any way.
d. Ronald is acting as executor of his uncle’s estate, which includes selling the property his uncle owned.
21) Which real estate brokerage ownership types may do business under a fictitious name?
a. Partnerships only
b. Sole proprietorships and partnerships only
c. Sole proprietorships only
d. Sole proprietorships, partnerships, and corporations
22) When is a real estate license required?
a. When performing maintenance work for one property owner
b. When performing real estate activities for others, for compensation of any kind
c. When performing real estate activities for others, without compensation
d. When performing real estate activities for yourself
23) Which of the following tasks would require a real estate license in California?
a. Assemble closing documents
b. Calculate a commission check
c. Host an open house
d. Place a for sale sign in a front yard
24) What must be true for a partnership to conduct real estate activities?
a. All partners must hold a broker license
b. All partners must hold a salesperson license
c. At least one partner must hold a broker license
d. At least one partner must hold a salesperson license
25) Which of the following tasks is an unlicensed assistant at a California brokerage permitted to perform?
a. Interpret contract information for a client.
b. Negotiate a commission.
c. Show property.
d. Write advertisements for broker approval.
26) Amy acts like a salesperson and is supervised by a broker, but she holds her broker’s license. What is her job title?
a. Associate broker
b. Broker of record
c. Confused
d. Salesperson
27) Which of the following properties is considered a mobile home?
a. A structure transported in three units and built in 1975 on a permanent foundation
b. A structure transported in two units and built in 1975 on a permanent chassis
c. A structure transported in two units and built in 2005 on a permanent chassis
d. A structure transported in two units and built in 2005 on a permanent foundation
28) Which of the following statements best describes a sole proprietor?
a. A brokerage owned by a single person
b. A brokerage owned by at least two people
c. An entity owned by one or more parties
d. An individual who holds a real estate license
29) Lynnette works for a regional bank. Her role is to gather information from buyers looking to obtain a home loan and make a recommendation as to whether the loan should be approved. Does she need a real estate license?
a. If her compensation is tied to the transaction being completed, she needs a real estate license.
b. No, bank employees are exempt from licensure.
c. Yes, any individual, including lenders, involved in the purchase of real property must have a license.
d. Yes, employees of banks, credit unions, and lending institutions must obtain a real estate license.
30) You’ve been studying real estate in California for a while and are a few weeks from taking the exam and getting your real estate license. Which activities are you able to do?
a. Charge your friends for real estate advice.
b. Go to auctions and buy real estate on a friend’s behalf and split the profit when he flips the house.
c. Negotiate and buy your own property.
d. Sell your friend’s property for a small percent of the profit.
31) Which of these parties must obtain a real estate license before performing real estate activities?
a. Apartment resident managers or their employees
b. Attorneys-at-law performing legal services for a client
c. Persons holding a duly executed power of attorney from the real property’s owner
d. Persons representing buyers or sellers who will receive compensation for their services
32) River is an unlicensed assistant at a brokerage. Which of the following tasks is she permitted to perform for her broker?
a. Assemble closing documents.
b. Host an open house.
c. Negotiate on a client’s behalf.
d. Suggest a sale price for a client’s listing.
33) You decide to help negotiate the sales price of a buddy’s place even though you don’t yet have a California real estate license. After the sale he pays you $50 in appreciation of your efforts. Why would this be considered an illegal activity?
a. Because anything over $25 is considered to be an illegal form of compensation to anyone without a license.
b. Because you can’t accept any amount of compensation for negotiating the sales price of a home that isn’t your own if you don’t have a license.
c. Because you didn’t have the compensation agreement written down before the sale, the compensation is illegal.
d. Because you offered advice negotiating the sales price when you shouldn’t have.
34) What must be true for a business to perform real estate activities?
a. All employees of the business must have a real estate license
b. At least one employee must have a broker license
c. At least one employee must have a salesperson license
d. At least one employee must have a salesperson license and another employee must have a broker license
35) Which real estate brokerage ownership types require a separate license?
a. Corporations only
b. Partnerships and corporations only
c. Partnerships only
d. Sole proprietorships only
36) Adam is an unlicensed assistant working with Sarah, a licensed salesperson. The following tasks are on their plates. Which of these actions can only Sarah performed?
a. Placing a for sale sign on a property
b. Preparing marketing materials for the property
c. Providing factual information about the property
d. Showing the property to prospective buyers
37) Amanda helps her neighbor sell his home by assisting with negotiations. She receives no compensation for her assistance. Based on this one transaction, Amanda ______.
a. Doesn’t need a real estate license
b. Must have a broker license
c. Must have at least an associate broker license
d. Must have at least a salesperson license
38) What types of real estate licenses are issued in California?
a. Broker and salesperson licenses
b. Broker, salesperson, and associate broker licenses
c. Only broker licenses
d. Only salesperson licenses
39) Angela is an unlicensed assistant working with Sam, a licensed salesperson. The following tasks are on their plates. Which of these actions can only Sam perform?
a. Draft the buyer’s offer to the seller
b. Negotiate on the client’s behalf
c. Provide factual information about a property
d. Schedule showings for a buyer
40) Tom is an unlicensed individual helping his sister, Katie, find a new house, in return for a trip to Europe. Which of the following activities can Tom legally perform?
a. He can negotiate the sale of her old house.
b. He can purchase a new property for Katie at an auction.
c. He can receive compensation from Katie for assisting in the purchase of her new house.
d. He can search real estate sites and resources to find available homes in the area.
41) June has worked with buyers and sellers for years. When homeowners default on their mortgage, June acts as trustee for the deed of trust. Under the deed of trust, June has the authority to sell the property. Does June have a real estate license?
a. If she receives compensation for performing this activity, she must have a real estate license.
b. No, trustees selling properties under a deed of trust are exempt from licensure.
c. She only needs a real estate license if she is selling her own property.
d. Yes, she is selling property for others. She must have a real estate license.
42) Which activity can you perform without a license in California?
a. Negotiate rent for another tenant in the office building where you work.
b. Negotiate rent of an office building for the nonprofit where you work.
c. Negotiate the sale price of a friend’s office building for a fee.
d. Sell your neighbor’s house for a fee.
43) In California, an individual performing real estate activities under the judgment or order of a court, such as a trustee in a bankruptcy, is ______.
a. An exception to the real estate licensing requirement
b. Required to have a broker license
c. Required to have at least an associate broker license
d. Required to have at least a salesperson license
44) Which of the following statements best describes a real estate partnership?
a. A brokerage owned by a single person
b. A brokerage owned by at least two people
c. An entity owned by one or more parties
d. A team of two individuals who each hold a real estate license.
45) Which of the following describes a prepaid rental listing service (PRLS)?
a. A PRLS is a group of real estate licensees who only deal with residential property rentals.
b. A PRLS is a type of real estate brokerage.
c. A PRLS provides listings of residential properties available for rent to prospective tenants for a fee.
d. A PRLS represents landlords by marketing their properties to prospective tenants for a commission.
46) Which of the following statements best describes a real estate corporation?
a. A brokerage owned by a single person
b. A brokerage owned by at least two people
c. A group of individuals who each hold a real estate license
d. An entity owned by one or more parties
47) What are common ownership structures for real estate brokerages?
a. Partnerships only
b. Sole proprietorships and partnerships only
c. Sole proprietorships only
d. Sole proprietorships, partnerships, and corporations
48) California licensee Donald has a new listing for the house next door to his. He’s never had problems with these neighbors and hopes to keep it this way by making sure the “right” people move in. He doesn’t show the property to any prospective buyers with children. These actions soon bring complaints of a fair housing violation. What effect does this have on Robert (Donald’s sponsoring broker)?
a. Neither Robert nor Donald will be affected by the fair housing violation.
b. Only Robert is liable for Donald’s actions, and he alone will be sanctioned as a result of Donald’s fair housing violation.
c. Robert is liable for Donald’s actions and could be sanctioned along with Donald as a result of Donald’s fair housing violation.
d. Robert is not liable for Donald’s actions and is not affected by the fair housing violation.
49) Sally just obtained her salesperson license. How long is the license valid?
a. Four years
b. One year
c. Three years
d. Two years
50) Jackson holds a real estate broker license with an MLO endorsement. How many hours of continuing education must he complete each year to renew this endorsement?
a. 10 hours
b. 20 hours
c. 45 hours
d. Eight hours
51) To best prevent risk associated with licensee non-compliance with real estate-related federal regulations, brokerage firms should do which of the following?
a. Encourage licensees to obtain outside training on real estate-related federal regulations.
b. Include a review of related federal legislation in the policies and procedures manual and provide appropriate training.
c. Rely on licensees to make themselves aware of all federal regulations related to real estate.
d. Require licensees to keep a tracking journal of all activities as proof that they’ve not violated federal regulations.
52) What is the minimum amount of full-time real estate industry experience that an individual must have to qualify for a broker’s license?
a. Four years
b. One year
c. Three years
d. Two years
53) Brenda is a real estate salesperson. Jim is her sponsoring broker. Brenda is moving to a different area in the state and will no longer be able to work with Jim. Her new sponsoring broker will be Cindy. What must take place for Brenda to transfer her license to Cindy?
a. Brenda completes a change application.
b. Brenda must complete a new license application.
c. Cindy completes a new license application for Brenda.
d. Jim must notify the California DRE and give Brenda her license certificate. Brenda and Cindy complete a change application.
54) Which agency issues the MLO endorsement?
a. California Department of Real Estate
b. Department of Finance
c. Department of Licensing
d. Nationwide Mortgage Licensing System and Registry (NMLS&R)
55) Which of these does a sponsoring broker owe their associate brokers and salespersons?
a. Free desk and office support
b. Passing along leads
c. Paying for marketing materials
d. Supervision of activities
56) What is vicarious liability as it applies to real estate?
a. A broker commits an illegal act.
b. A broker directs a licensee to commit an illegal act
c. A broker is held responsible for the actions or omissions of the broker’s licensees.
d. One licensee witnesses another licensee’s misconduct.
57) How old must an individual be to qualify for a real estate broker license in California?
a. 18
b. 19
c. 20
d. 21
58) Sally is a real estate salesperson. How many hours of continuing education must she complete before the license expiration date in order to renew it for another four years?
a. 25 hours
b. 30 hours
c. 45 hours
d. 8 hours
59) How long is an MLO endorsement valid?
a. Four years
b. One year
c. Three years
d. Two years
60) Maura is a real estate salesperson who does not have an MLO endorsement. Which of these actions can she perform for her client, who is financing the purchase of a single-family home?
a. Offer to negotiate the terms of the client’s loan application.
b. Offer to provide the client with a list of lenders they could consider working with to obtain the loan.
c. Service the client’s loan.
d. Take the client’s residential mortgage loan application.
61) How many hours of continuing education must a California licensee complete in order to renew a real estate license?
a. 135 hours
b. 30 hours
c. 45 hours
d. 8 hours
62) Jackson holds a real estate broker license with an MLO endorsement. How often must he renew his MLO endorsement?
a. Every four years
b. Every three years
c. Every two years
d. Every year
63) Bradley has a real estate salesperson’s license. He’s done some traveling recently and missed the deadline to renew his license. It’s now 30 days past the expiration date. What must he do to renew his license?
a. Complete the continuing education requirements and submit a renewal and late fee.
b. File an appeal with the Real estate Commissioner.
c. Re-qualify for a real estate license by completing pre-licensing courses and passing the state licensing exam.
d. Retake the state licensing exam.
64) What must take place if a real estate salesperson wants to transfer their license to a new sponsoring broker?
a. The existing sponsoring broker must notify the California DRE and give the salesperson their license certificate. The salesperson and new sponsoring broker complete a change application.
b. The new sponsoring broker completes a new license application for the salesperson.
c. The salesperson completes a change application.
d. The salesperson must complete a new license application.
65) Al is 70 years old and has held his real estate broker license in good standing for 30 consecutive years. His license is up for renewal soon. How many continuing education hours must he complete?
a. 0 hours
b. 30 hours
c. 45 hours
d. 8 hours
66) Years ago, Rachel held a real estate license. She took some time off to travel and start a family. Now she’s ready to get back in the saddle. Her license expired three years ago. What must she do to renew her license and start practicing real estate again?
a. Complete the continuing education requirements and submit a renewal and late fee.
b. File an appeal with the Real Estate Commissioner.
c. Requalify for a real estate license by completing pre-licensing courses and passing the state licensing exam.
d. Retake the state licensing exam.
67) Which federal act requires states to pass laws relating to mortgage loan originator (MLO) endorsements?
a. Consumer Financial Responsibility Act
b. Regulation Z
c. SAFE Act
d. Senate Bill 36
68) How many hours of continuing education must real estate licensees complete each year to renew their MLO endorsement?
a. 10 hours
b. 20 hours
c. Eight hours
d. Four hours
69) What is the relationship between a policies and procedures manual and the broker’s obligation to supervise agents?
a. Brokers who can prove that all agents have access to the PPM won’t be cited for failure to adequately supervise agents.
b. Brokers who enforce policies and procedures outlined in an effective PPM have proof of efforts to properly train and supervise agents.
c. The PPM may be used in place of face-to-face orientation training for new licensees.
d. The PPM outlines the broker’s responsibility to supervise and provides detailed proof of scheduled one-on-one meetings and group training sessions.
70) Karla is a sponsoring broker who owns her own brokerage. She has two associate brokers and two salespersons, who all work as independent contractors. She also has an unlicensed assistant on payroll as an employee. Which of the following is true of Karla’s liability?
a. Karla is liable for the actions of all members of her firm, both the independent contractors and the employee.
b. Karla is only liable for the actions of her associate brokers.
c. Karla is only liable for the actions of her associate brokers and salespersons.
d. Karla is only liable for the actions of her salespersons.
71) As a managing broker, you’re responsible for your associate brokers’ actions. Which of the following risk management techniques helps prevent the risk associated with vicarious liability?
a. Equipping your office with fire alarms and sprinklers
b. Prohibiting licensees from recommending third party vendors to clients
c. Providing training and policies/procedures documentation to staff
d. Purchasing a general liability insurance policy
72) Which of these real estate licensees may be exempt from the continuing education requirements for license renewal?
a. Al is 70 years old and has been licensed in good standing for 30 consecutive years.
b. Candice is 55 years old and has been licensed in good standing for 30 consecutive years.
c. Savannah is the broker of record responsible for supervising five salespeople.
d. Willard is 70 years old and has been licensed in good standing for 20 consecutive years.
73) What must real estate licensees who obtain the MLO endorsement do?
a. They must complete 20 hours of education, pass an examination, submit fingerprints to NMLS&R, and authorize a credit report pull.
b. They only need to complete 20 hours of education.
c. They only need to complete 20 hours of education and pass an examination.
d. They only need to pass an MLO exam containing national and state-specific content.
74) Steve holds a real estate license in Oregon but would also like to perform real estate activities in California. What must he do?
a. As long as Steve holds an active license in a neighboring state, he can practice real estate in California.
b. California does not have reciprocity agreements with any other states. Individuals licensed in other states must complete all of the requirements that an unlicensed individual completes.
c. California has a reciprocity agreement with Oregon. Steve can complete a California application to receive a license.
d. Steven cannot hold licenses and perform real estate activities in multiple states.
75) How old must an individual be to qualify for a real estate salesperson license in California?
a. 18
b. 19
c. 20
d. 21
76) Seamus sent a letter to the residents of Maywood Park, stating, “The Mormons are moving in! Sell your houses before property values plummet.” This is a fair housing violation, and also ______.
a. A license law violation
b. A strong business practice
c. Creative advertising
d. Morally ambiguous
77) If your license is suspended, it’s only temporary. If your license is revoked, it is permanently removed and requires ______.
a. Additional education
b. A new license application after the penalty period
c. A small fee
d. A verbal reprimand
78) What happens to a California real estate licensee if they are involved in a case and cannot pay the judgment amount, and the consumer is awarded money from the real estate Recovery Account?
a. Nothing! That is what the fund is for!
b. Their commissions will be garnished until the amount paid out to the victim is repaid.
c. Their license will be suspended until they pay back the amount paid to the victim, plus interest.
d. They can continue to practice real estate, but must pay back the amount paid out, plus interest.
79) In most states, which of the following situations would most likely be grounds for suspension or revocation of a real estate license?
a. Failure to determine the correct list price in a comparative market analysis
b. Failure to find a buyer for a listed property
c. Failure to include a broker protection clause in a listing agreement
d. Failure to specify a definite termination date in a listing contract
80) Bobby is representing his fiancé in a real estate transaction. Does he have any special disclosure requirements?
a. No, because they are not married yet
b. Only if the wedding will occur before the closing date
c. Yes, because all special relationships must be disclosed
d. Yes; licensees must always disclose their marital plans
81) Serious violations of the real estate license laws typically result in which disciplinary action or actions?
a. Additional education
b. A small fine
c. License suspension or revocation
d. Reprimand
82) Shana has a former conviction for petty theft, and one for armed robbery—two events that occurred more than five years ago. When she applies for her real estate license, what should she do with regard to these convictions?
a. Disclose both, because any criminal conviction must be disclosed.
b. Disclose only the armed robbery.
c. Disclose only the petty theft, because armed robbery is not a reportable offense.
d. Not disclose either, because they occurred more than three years ago.
83) James represented a client who believes James was guilty of misrepresentation. The client files a complaint against James. Which entity will investigate?
a. A private investigator
b. California DRE
c. James’ broker
d. The state attorney general
84) If a licensee commits a violation and it’s found the broker didn’t adequately supervise the licensee, whose license in jeopardy?
a. Both the broker’s and licensee’s
b. The broker’s
c. The licensee’s
d. The license of any future licensee of the firm
85) Rita missed an important deadline for her client. This is an example of a(n) ______.
a. Conversion
b. Negligence
c. Ordinary mistake
d. Personal dealing
86) When a complaint is filed against a real estate licensee in California, who is responsible for investigating the complaint?
a. An arbitrator
b. A private investigator
c. California DRE
d. The state attorney general
87) If Jan is using the designation GRI (Graduate of the Real Estate Institute), but she has not paid her annual membership dues, is this a violation?
a. No, because failure to pay dues does not constitute non-membership
b. No, because GRI is not covered in real estate law
c. Yes, because failure to pay dues is considered petty theft
d. Yes, because it is dishonest
88) James is a California licensee accused of serious license law violations. Which of these will NOT be part of the process of investigation by the DRE?
a. It will hold a formal hearing before a judge to determine if the charges should be dismissed or are proven.
b. It will impose disciplinary actions against James as deemed appropriate based on the violations he committed.
c. It will issue a warrant for James’s arrest, and James will be held while the DRE completes its investigation.
d. It will obtain statements and records related to the inquiry from James, the complainant, and any witnesses.
89) What is the maximum amount that will be paid out of the Recovery Account for a transaction?
a. $10,000
b. $100,000
c. $25,000
d. $50,000
90) The DRE investigated Sheila and has imposed a license suspension. What does this mean for Sheila?
a. Her license is void. She’s not allowed to practice real estate anymore, and can’t reactivate her license.
b. She may perform all her normal licensed activities, but she’s on probation so she better mind her Ps and Qs.
c. She must pay a fine to have the suspension removed, and may not perform real estate activities until she does so.
d. She’s not allowed to practice real estate during the term of the suspension, but after that time she can continue performing licensed activities.
91) What is the maximum amount that will be paid out of the Recovery Account per licensee?
a. $100,000
b. $250,000
c. $50,000
d. $500,000
92) Requiring a licensee to submit detailed reports related to trust fund accounting is an example of a condition that may be placed on a licensee with a ______ license.
a. Restricted
b. Retracted
c. Revoked
d. Suspended
93) If Sima entered a plea of no contest in a criminal case she ______.
a. Must not report this; as it would be a violation of confidential information
b. Must report this to California DRE only if the charge is related to theft
c. Must report this to California DRE under all circumstances
d. Need not report this to California DRE because it is not a guilty verdict
94) Gina received an earnest money check from her buyer on Friday, after the office had closed and her broker had gone home for the day. For safekeeping, Gina should ______.
a. Cash the check and write a new check Monday for the same amount
b. Deposit the money into her savings account so her client can earn interest over the weekend
c. Hold onto the check until Monday, and give it to her broker then
d. Return the check to her client
95) Tabor’s uncle hired him as a listing agent. Because of their relationship, what may Tabor do with regard to the termination date of the agreement?
a. Include an automatic renewal clause.
b. Include a reasonable termination date.
c. Leave it out.
d. Write “family member” in the termination date field.
96) A cabin has 120 feet of lake frontage. The cabin owner’s ability to access the lake is based on ______.
a. An aquifer
b. An easement
c. Littoral rights
d. Riparian rights
97) Which economic characteristic of land contains the concept that a land’s value can be affected by the changes made to it, such as construction of buildings or fences?
a. Improvements
b. Permanence of investment
c. Scarcity
d. Uniqueness
98) Property owners who live on or next to water have certain rights. An example of one of these rights includes ______.
a. Contamination
b. Hazardous waste
c. Littoral
d. Reversionary
99) A river runs adjacent to a rancher’s property. The rancher’s ability to use the water from the river is based on ______.
a. Aquifer rights
b. Encroachment rights
c. Littoral rights
d. Riparian rights
100) Which of these is the best definition of real estate?
a. Everything that’s not real property
b. Land, plus all things permanently attached to it naturally or artificially
c. Real property, plus all of the interests, benefits, and rights included in ownership
d. The earth’s surface extending downward to the center of the earth and upward to infinity, including permanently attached natural objects
101) Annette really wants to move to San Francisco, but she’s unsure whether she’ll be able to afford to live there. Housing is very expensive because there simply is no room to build any new housing units. Which economic characteristic does this reflect?
a. Area preference
b. Improvements
c. Permanence
d. Scarcity
102) The right to access non-navigable rivers, streams, and other flowing bodies of water adjacent to a property is called ______ rights.
a. Land
b. Littoral
c. Mineral
d. Riparian
103) California resident George has purchased a property with riparian rights. What does this mean?
a. He has the right to use, divert, store, or sell the water that’s on or under his land.
b. He has the right to use the percolating ground water, but only for growing crops.
c. He has the right to use the water that flows across his land.
d. The water rights have been separated from the land he now owns.
104) What’s the best definition of land?
a. Everything that’s not real property
b. Land, plus all things permanently attached to it, naturally or artificially
c. Real estate, plus all of the interests, benefits, and rights included in ownership
d. The earth’s surface, extending downward to the center of the earth and upward to infinity, including permanently attached natural objects
105) Littoral rights allow property owners to take which of these actions?
a. Construct a dock to moor their boat.
b. Irrigate from a stream running through the property.
c. Navigate the river running through the property.
d. Use the water from the lake bordering the property.
106) Over time, a river running through Farmer Jones’ ranch deposits sediment along the banks of the river and adds half an acre of land to the ranch. This is an example of what process?
a. Accretion
b. Avulsion
c. Erosion
d. Riparian buffering
107) Physical characteristics of land include its immobility, indestructibility, and ______.
a. Location
b. Permanence of investment
c. Scarcity
d. Uniqueness
108) In many areas of the country, Marcellus Shale has become a hot commodity. This type of rock produces gas, which can be mined, stored, and sold. Abe learned that his family farmstead sat over a rich deposit of Marcellus Shale. What type of rights does Abe have relative to this shale?
a. Air rights
b. Sub-surface rights
c. Surface rights
d. Water rights
109) Sarah owns her own home. As part of her basic property rights, she has the right to decide who may or may not access the property. Which right is this?
a. Disposition
b. Enjoyment
c. Exclusion
d. Possession
110) Hal and Sara own a 212-acre farm. Their property is landlocked, but they have permitted water rights to use the stream located six miles away for irrigation purposes. What kind of water rights do they hold?
a. Alluvial
b. Littoral
c. Prior appropriation
d. Riparian
111) The right to access ponds, lakes, and other stationary bodies of water is ______.
a. Littoral
b. Mineral
c. Riparian
d. Water
112) Jamie owns a lakeside home. Over a period of years, the water has receded quite a bit, doubling the size of the sand beach on his property. What’s the name of this process?
a. Accretion
b. Erosion
c. Exclusion
d. Reliction
113) Licensee Arlene is helping a client purchase a property that’s suitable for use as a private school, meaning it needs to have classrooms, assembly rooms, and sports fields. She locates two properties in the area that have the required attributes. What category of property is this considered?
a. Commercial
b. Industrial
c. Residential
d. Special purpose
114) Basic property rights include the rights of possession, control, exclusion, enjoyment, and ______.
a. Destruction
b. Disposition
c. Encroachment
d. Reliction
115) Doreen owns an office building and receives income from six stable tenants. What category of real estate does Doreen own?
a. Agricultural
b. Commercial
c. Industrial
d. Residential
116) Which physical characteristic of land addresses the concept that land isn’t interchangeable, and one piece of land isn’t exactly like another?
a. Immobility
b. Indestructibility
c. Permanence of investment
d. Uniqueness
117) Jordan bought 25 acres along a navigable river. Several years later, Jordan calculates that the river has slowly carried away almost two acres of land. What process caused this?
a. Accretion
b. Avulsion
c. Erosion
d. Riparian buffering
118) When Henry first began his real estate career, he focused on residential properties. As he gained more experience, he found that he really enjoyed helping business owners find warehouses for their products, or properties where they could conduct manufacturing activities. Of the primary categories of real estate, what types of properties does Henry handle?
a. Industrial
b. Leisure
c. Residential
d. Retail
119) Property ownership gives the title holder a bundle of rights. What’s significant about the concept of a bundle of rights?
a. It describes an infinite number of rights associated with property ownership.
b. It describes the ability to separate one right from the others while leaving the rest of the bundle intact.
c. It’s an ancient Latin term meaning the property owner’s rights can’t be taken away.
d. The property owner must identify each separate right that will be purchased; they’re not automatically included in a transfer.
120) Along with property ownership, rights are granted to use the land’s physical components. Which right allows a property owner to use or sell the underground resources, such as natural gas and minerals?
a. Air
b. Sub-surface
c. Surface
d. Water
121) Which term would you most likely see associated with a lake?
a. Fracking
b. Littoral
c. Percolating
d. Riparian
122) Which physical characteristic of land addresses the concept that the geographic location of a piece of land is fixed and can never be changed?
a. Immobility
b. Indestructibility
c. Scarcity
d. Uniqueness
123) Ruby just bought a few undeveloped acres in the California desert. Once she installs her manufactured home, she plans to obtain water for herself and her animals by digging a well to access the ______.
a. Appropriated water
b. Percolating ground water
c. Public water source
d. Riparian water
124) What’s the best definition of personal property?
a. Artificial attachments to land that include things such as fencing, buildings, and walkways
b. Everything that’s not real property
c. Land
d. Property that’s fenced
125) Allen and Lewis are friends who each recently purchased real estate. Allen purchased a patio home in a small town an hour from the city, while Lewis purchased a condo in a really hot area near the city center. Although they paid similar amounts for their properties, Lewis’ condo is worth much more two years later. Which economic characteristic does this demonstrate?
a. Area preference
b. Improvements
c. Permanence
d. Scarcity
126) Juan has decided to invest his small inheritance in real estate. He is drawn to the fact that he can add a building where there wasn’t one previously and immediately increase the value of his investment. Which economic characteristic of real property is this?
a. Area preference
b. Improvements
c. Permanence
d. Scarcity
127) The owners of Brick and Brack, a development company, have purchased several acres of vacant land for their latest development. They plan to build a community of affordable single-family homes. What category of real estate will these be in after construction?
a. Agricultural
b. Commercial
c. Industrial
d. Residential
128) Your neighbor bought rights that will prevent you from ever building above two stories. What type of rights are these?
a. Air
b. Littoral
c. Mineral
d. Riparian
129) Sally and Pete are city dwellers who have always dreamed of living in a rural setting. When Pete inherits a 600-acre cattle ranch from his uncle, they don’t waste a moment packing up and moving to the ranch. What category of real estate is their new home considered?
a. Agricultural
b. Commercial
c. Industrial
d. Residential
130) What do riparian rights give landowners the ability to do?
a. Drill an agricultural water well.
b. Prohibit others from using the water.
c. Use a pond adjacent to the property.
d. Use a river running through the property.
131) Jacob is a developer who purchased 78 acres and had it subdivided into half-acre lots. He decided to install sewer and underground electric for the entire subdivision, because he thinks that he will easily recoup his initial infrastructure investment. This is an example of which economic characteristic of real property?
a. Area preference
b. Immobility
c. Permanence of investment
d. Scarcity
132) What’s the best definition of real property?
a. Artificial attachments to land that include things such as fencing, buildings, and walkways
b. Earth, soil, and air
c. Land, plus all things permanently attached to it naturally or artificially
d. Real estate, plus all of the interests, benefits, and rights included in ownership
133) Alluvion describes new deposits of land that are the result of what natural process?
a. Accretion
b. Erosion
c. Exclusion
d. Reliction
134) John and Tara have lived in their home for 23 years and are excited to move to Florida for retirement. As homeowners, what right allows them to sell their home?
a. Disposition
b. Enjoyment
c. Exclusion
d. Possession
135) Which of the following is true about air rights?
a. They allow the owner to use the open space above buildings.
b. They allow the owner to use the space directly below buildings.
c. They cannot be bought or sold.
d. They include mineral rights.
136) What are improvements with regard to property?
a. Another name for a building permit
b. Artificial attachments to land that include items such as fencing, buildings, and walkways
c. Natural fixtures that are part of the land and that enhance its value
d. The right to increase the value of a property
137) Which physical characteristic of land addresses the concept that while improvements may deteriorate over time, the land itself cannot be destroyed?
a. Immobility
b. Indestructibility
c. Permanence of investment
d. Uniqueness
138) Which of the following is included with real property rights?
a. Enjoyment
b. Hazardous acts
c. Right to destroy
d. Right to encroach
139) Shannon’s rural property in San Diego County has a small stream that runs across one corner where her horses are pastured, and her horses use it as a water source. What’s true about this situation?
a. Shannon has a riparian right to use the water flowing across her property as a water source for her animals, though she may not divert the water.
b. Shannon is violating the state’s water laws, which prohibit any use of water that flows across a property.
c. She must have a permit from the state water board to use the water from the stream that runs across her property.
d. The doctrine of prior appropriation makes this use of the stream water illegal, since it originates on another person’s property.
140) The right to access rivers, streams, and other flowing bodies of water adjacent to a property is called ______.
a. Land
b. Littoral
c. Mineral
d. Riparian
141) Display shelves installed by a business owner in a rented building are a good example of ______.
a. Leased premises
b. Real estate
c. Real property
d. Trade fixtures
142) The Acme Company is planning to build a factory on the three-acre property it just purchased in Southern California. The factory will need access to a large amount of water. How will the company gain the right to the water it needs?
a. It must apply for a water permit from the California State Water Resources Control Board.
b. It must negotiate a deal with a property owner with previous water rights under the doctrine of prior appropriation.
c. It must purchase water rights from a current property owner with riparian rights.
d. It must use reclaimed water from the local water treatment plant.
143) What term explains the complexity of property ownership rights and how rights for a single property can be “owned” by multiple parties at the same time?
a. Littoral rights
b. Physical component rights
c. Riparian rights
d. The bundle of rights
144) Licensee Dionne pointed out to her buyer client the items that would be considered real property. What is one of the key characteristics of an item that is real property (also known as a fixture)?
a. Internal or external to the house
b. Made of the same material as an interior or exterior wall
c. Over or under a certain value
d. Permanently affixed to the property
145) Of the following, which is most likely to be considered a fixture?
a. a fence around a field
b. a pasture
c. a stream
d. a tractor
146) Mrs. Blanchard cut down a tree growing on her property. Which of the following has occurred?
a. A fixture has become real property.
b. Personal property has become real property.
c. Real property has become a trade fixture.
d. Real property has become personal property.
147) What are emblements in real estate?
a. Cultivated crops
b. Detached fixtures
c. Free-standing plants
d. Open spaces
148) Having _______ on file allows lenders to confiscate personal property pledged as collateral in the event of a borrower default.
a. A chain of title
b. A title insurance policy
c. A UCC security agreement and financing statement
d. Proof of ownership
149) What’s the Uniform Commercial Code?
a. A set of business laws created to regulate commercial transactions, including contracts dealing with personal property
b. A set of business laws created to regulate financial contracts dealing with real estate
c. A set of standards created to create a uniform way in which all commercial real estate transactions must be conducted
d. A set of standards for commercial business code of ethics
150) Which of the following is an example of a fixture that is real property?
a. Above-ground pool and pool accessories
b. Bathroom mirror hanging on a hook
c. Photos and wall hangings
d. Shelves attached to the wall with brackets
151) What’s contained in a UCC security agreement?
a. A complete description of the personal property used as collateral
b. A list of personal character references
c. A list of security services provided under the contract
d. A signature of an authorized representative of the lender
152) Bart just toured his fourth patio home of the day. To help him remember what he saw in each one, he’s making notes about décor, updates, and inclusions that will stay with the property. Which of the following items is NOT considered personal property and would therefore stay with a home?
a. The area rug in the dining room
b. The banker’s lamps in the den
c. The chandelier in the foyer
d. The patio heater on the back patio
153) Who is required to sign a security agreement for security arrangements under the Uniform Commercial Code?
a. The borrower
b. The lender
c. The seller
d. The testator
e. The UCC requires the borrower to sign a security agreement for any security arrangements. When used in the financing of real estate, the agreement must adequately identify personal property used as collateral.
154) Which of the following would be considered personal property?
a. Built-in microwave
b. Custom curtains
c. Free-standing TV
d. In-ground pool
155) Which of the following are included in the transfer of real property unless specifically excluded in writing?
a. Chattel
b. Fixtures
c. Personal possessions
d. Personal property
156) What is the best way for a seller and buyer to demonstrate their agreement that the home’s existing refrigerator and a dishwasher are included in the property sale?
a. By including a bill of sale or agreement in the purchase contract
b. By shaking hands on it on the day of the sale
c. By verbal agreement after the sale
d. By verbal agreement before the sale
157) Which of the following would be used to describe an item that is both a fixture and real property?
a. Above-ground
b. Free-standing
c. In-ground
d. Movable
158) An item that would most likely be considered a fixture because of agreement between buyer and seller is _____.
a. a garage door opener
b. a garbage disposal
c. draperies
d. kitchen cabinets
159) Ron’s company leased a building so that it could build an escape room experience. After operating for two years, attendance (and thus its profits) started to drop significantly, so it decided to close the location. When the workers started taking down the installation, they realized that some of the structures would damage the walls if they were to try to remove them. Which of these is true about these trade fixtures?
a. If Ron leaves them in place and the lease expires, he has three months to remove them.
b. Ron is required to leave the fixtures if they’re attached.
c. Ron is required to take the fixtures and return the premises to its original condition.
d. Ron may take the fixtures as long as he repairs any damage caused by removal.
160) If an item is permanently attached to a property, a court would most likely consider it a fixture if it passes which of the following tests?
a. Adaptability of the item to the land’s use
b. Agreement of the parties
c. Method of annexation
d. Relationship of the parties
161) When using the MARIA acronym to test whether an item is a fixture, what do the two As stand for?
a. Acceptability of the fixture and agreement of the parties
b. Adaptability of item and accessibility to the property
c. Adaptability of item to land’s use and agreement of the parties
d. Allowable use and acceptable use
162) Ted’s seller client is adamant that she’ll be uprooting and taking most of the fruit trees in the backyard when she sells her home. Ted makes a note to himself that he’ll need to include the ______ of the trees in the comments for his listing.
a. Abatement
b. Annexation
c. Defenestration
d. Severance
163) In the consideration of real property and personal property, severance is ______.
a. The process of cancelling the agreement or bill of sale for a real estate transaction.
b. The process of converting personal property to real estate.
c. The process of removing a fixture before agreement or after negotiation, to designate it as personal, rather than real, property.
d. The test of how an item is attached to the property and how permanent the attachment is.
164) If the sale of a property that includes soybean fields occurs before the crops are ready for harvest, which of the following is the best option for the parties to the transaction to take?
a. The buyer should assume the crop transfers with the property.
b. The contract between the parties should clarify the disposition of the crop.
c. The seller should assume the crop does not transfer with the property.
d. The seller should harvest the beans before the sale closes.
165) Tim and Tina Wells bought a home with absolutely beautiful perennial gardens in the back. The plantings were designed to bring birds, bees, and butterflies and to provide color for most of the year. When they did the final walkthrough, they were dismayed to see that many of the shrubs and flowering plants had been removed. They expected these plantings to be considered part of the real property because of the ______.
a. Adaptation to the land
b. Agreement of the parties
c. Intention in placing the item
d. Method of annexation
166) The MARIA acronym helps to identify the five tests of a fixture. Which of the following tests refers to how and whether the item is attached to the property?
a. Adaptability of the item to the land’s use
b. Agreement of the parties
c. Intention in placing item on land
d. Method of annexation
167) Which of the following is NOT one of the five basics tests that courts use to determine whether an item is a fixture or personal property?
a. Agreement of parties
b. Legally permissible use
c. Method of annexation
d. Relationship of the parties
168) In which form of co-ownership is a person’s ownership inheritable?
a. Joint tenancy
b. Tenancy by the entirety
c. Tenancy in common
d. Tenancy in severalty
169) Once Greg and Caitlin were married, they decided to purchase a home together. Since it was a shotgun wedding after a weekend in Vegas, they made sure that their ownership included the right of survivorship as well as protection from the other spouse attempting to sell the house from under them. Though not recognized in all states, the most likely form of co-ownership under which they would make this purchase is ______.
a. Estate in severalty
b. Joint tenancy
c. Tenancy by the entirety
d. Tenancy in common
170) John and Dale are married in San Francisco, and soon purchase a condo. They’ll take title to it by default as ______ according to California law.
a. Community property
b. Joint tenants
c. Tenants by the entirety
d. Tenants in common
171) California couple Tim and Roxanne own a condo as community property. When Tim stops paying his credit card debt, can the creditor put a lien on their condo?
a. No. Community property is exempt from liens and judgments.
b. No. Creditors may not place a lien on community property to collect on an individual co-owner’s debt.
c. Yes. A lien may be placed on community property for a debt owed by one of the co-owners.
d. Yes, as long as Tim’s debt was incurred while he and Roxanne were married.
172) Property with ownership by more than one person is known as ______.
a. Co-ownership
b. Dual ownership
c. Estate by severalty
d. Property partnership
173) Billie (Wilhelmina) Silva was just licensed as a broker, and she plans to hang out a shingle and go into business for herself. As a sole proprietor, which of the following business names can she NOT use?
a. Billie Silva
b. Billie Silva Realty
c. Happy Homes Realty
d. Wilhelmina Silva Realty
174) Sam and Bridget are cousins who jointly own property. They are both named on the deed, they received title at the same time, they have the right of survivorship, and they each have equal interest and undivided rights of possession. What type of ownership do they have?
a. Estate in severalty
b. Joint tenancy
c. Tenancy by the entirety
d. Tenancy in common
175) Ken, Barbie, and Skipper owned a property as a joint tenancy. When Skipper moved out of state, she sold her interest to Midge. Two years later, Ken died. How is the interest in the property divided?
a. Barbie and Midge each own 50%.
b. Barbie and Skipper each own 50%.
c. Barbie, Midge, and Ken’s heirs each own one-third.
d. Barbie owns two-thirds, and Midge owns one-third.
176) Siblings Julia and Gene are co-owners of a small retail building in which a tanning salon is currently operating. Gene really wants to leave his ownership interest to his son when he dies, but the way in which they own the property doesn’t allow him to do so. What type of ownership do they have?
a. Joint tenancy
b. Tenancy by the entirety
c. Tenancy in common
d. Tenancy in
177) Debbie and Chris are a married couple in California. When they purchase their first home together, they want to make sure that if one of them dies, the other will inherit ownership of the property. How should their ownership be recorded on the deed?
a. Community property
b. Community property with right of survivorship
c. Tenants by the entirety
d. Tenants in common with right of survivorship severalty
178) Which ownership type is defined by four unities: time, title, interest, and possession?
a. Freehold estate
b. Joint tenancy
c. Tenancy by the entirety
d. Tenancy in common
179) Which type of ownership includes the unity of time, title, interest, possession, and marriage, and dissolves to a tenancy in common after a divorce?
a. Estate in severalty
b. Joint tenancy
c. Tenancy by the entirety
d. Tenants in common
180) Which one of the following statements about community property rights and property ownership is true?
a. All property purchased before and during the marriage or legal union automatically becomes community property.
b. All property purchased separately before the marriage or legal union must be sold and the profits divided equally between the partners.
c. Any property purchased before the marriage or legal union must have the spouse as the beneficiary.
d. Property owned separately before the marriage or legal union is separate from the community property, but property purchased during the marriage is owned equally.
181) Ryanne is a tenant in a single-family home owned by Dominick. What type of interest does Ryanne have in the property?
a. Freehold
b. Homestead
c. Leasehold
d. Lifelong
182) Which of the following describes an estate for an unknown period of time, with either party permitted to terminate the lease by giving notice to the other?
a. Estate at will
b. Estate for years
c. Leasehold estate
d. Life estate
183) Lucas, Ivan, Chad, and Trace own a property as joint tenants. After a few years, Ivan sells his interest to Tom (with permission from Lucas, Chad, and Trace). Chad dies intestate but is survived by a wife, Amy. Trace also then passes away but wills his property to Monique. Who owns the property after Trace’s death?
a. Lucas
b. Lucas and Tom
c. Lucas, Monique, and Amy
d. Lucas, Tom, Amy, and Monique
184) What form of ownership is inheritable and includes the entire bundle of rights, not subject to any conditions or qualifications?
a. Fee entire
b. Fee on condition
c. Fee simple absolute
d. Qualified fee
185) In California, an estate at will is known as ______.
a. A life estate
b. Chattel interest
c. Personal property
d. Real chattel
186) Eva, Stella, and Lynn owned a vacation home two blocks from the beach. Sadly, Stella passed away over the winter, so when summer arrived, Eva and Lynn shared the home with Stella’s nephew Drew, to whom Stella willed her share of the property. What type of ownership is this?
a. Estate in severalty
b. Joint tenancy
c. Tenancy by the entirety
d. Tenancy in common
187) Which of the following is a life estate in property held by a widow?
a. Curtesy
b. Dower
c. Estate at will
d. Homestead
188) Lewis and Elliot started a real estate investment business together. After much discussion with their attorney, they decided to incorporate, but in such a way that they are treated like a partnership and don’t have to pay corporate taxes. What form of business do they have?
a. Double proprietorship
b. Limited liability partnership
c. Subchapter C corporation
d. Subchapter S corporation
189) Rhonda and Oliver bought an old schoolhouse with the hope of transforming it into a residence. They owned the property as joint tenants. After Oliver died, how did Rhonda own the building?
a. As a joint tenant with rights of survivorship
b. As a tenant in common with Oliver’s heirs
c. In severalty
d. In trust
190) Ken, Dale, and James were brothers who owned more than 100 acres as tenants in common. The relationship between Ken and James disintegrated, and so James initiated a lawsuit. The end result was that the court gave each brother a designated set of acres to own. What did the court grant?
a. Bifurcation
b. Parcel
c. Partition
d. Severalty
191) An inheritable freehold estate that’s a fee simple defeasible (where the grantor can reclaim ownership) is also known as ______.
a. Fee absolute
b. Fee simple
c. Qualified fee
d. Tenancy at will
192) What’s the difference between reversionary interest and remainder interest in a property?
a. Remainder interest applies only to heirs.
b. Reversionary interest only applies to spouses.
c. With remainder interest, the property remains with the owner, even when a life tenant possesses the property.
d. With reversionary interest, the property reverts to the owner after the death of the life tenant.
193) Sherman, who owns property in a life estate, neglects the property, significantly diminishing its value. This is called ______.
a. A lease option
b. An act of waste
c. An estate at sufferance
d. A possessional prerogative
194) Non-lawful possession after the expiration of a lease is called ______.
a. Estate at sufferance
b. Estate at will
c. Estate for years
d. Leasehold estate
195) A sole proprietor is a familiar business model. If you practice real estate as a sole proprietor, which of the following is a true statement?
a. You are on a salary.
b. You cannot be held liable for your actions.
c. You have a partner.
d. You’re an independent contractor.
196) Peter is a tenant in a single-family home owned by Cheyenne. What type of interest does Cheyenne have in the property?
a. Freehold
b. Homestead
c. Leasehold
d. Lifelong
197) Dan and Rita are a married couple in California. Which of these items will NOT become community property for them?
a. The 10-bedroom, 10-bath home they purchase together.
b. The horse Rita buys with income from her paycheck.
c. The Maserati Dan buys with income from his investments.
d. The ruby slippers Rita inherits from her Auntie Em.
198) ______ is the form of ownership used by married couples in certain states. It includes automatic survivorship rights.
a. Tenancy by five unities
b. Tenancy by the entirety
c. Tenancy by union
d. Tenancy in common
199) To what type of estate does pur autre vie apply?
a. Fee simple
b. Freehold estate
c. Homestead
d. Leasehold
200) Which one of the following types of ownership termination allows each tenant to have a specific, divided portion (partition) of the property exclusively?
a. Termination by division
b. Termination of co-ownership by partition
c. Termination of estate in severalty
d. Termination of joint tenancies
201) Which form of real property ownership (for owners other than married couples) means there’s equal ownership shares with undivided possession rights?
a. Joint tenancy
b. Tenancy by the entirety
c. Tenancy in common
d. Tenancy in severalty
202) Jenner purchased his first home, to which he’ll have access forever, as far as he knows. Jenner owns ______.
a. A freehold estate
b. A leasehold estate
c. An estate for years
d. An ownership estate
203) In California, an estate for years is known as ______.
a. Annual chattel
b. Chattel annual
c. Chattel real
d. Personal interest
204) Widget Corporation just bought land on which it plans to build a new manufacturing facility. How is the land owned?
a. It’s a joint tenancy.
b. It’s held as a tenancy in common.
c. It’s owned as an estate in severalty.
d. There isn’t enough information to tell.
205) Which of the following is NOT a characteristic of a corporation?
a. Corporations are recognized legal entities.
b. Corporations are tangible and nontaxable.
c. Corporations are taxable.
d. Corporations have tax rates separate from individual tax rates.
206) Which of the following is a life estate in a property held by a widower?
a. Curtesy
b. Dower
c. Estate at will
d. Remainderman
207) Limited liability companies and limited liability partnerships are favorable forms of business because ______.
a. Owners of the LLC or LLP are personally liable for LLC/LLP obligations.
b. They aren’t taxed as partnerships.
c. They don’t require a general partner.
208) All trusts have three parties: the trustor, the beneficiary, and the ______.
a. Attorney in fact
b. Broker
c. Founder
d. Trustee
209) When Edmund died, he left several properties to his heirs. He owned a grocery store and a campground outright, and a strip mall that was held in a living trust. Which of the properties, if any, did NOT have to go through the probate process after his death?
a. The campground
b. The grocery store
c. The strip mall
d. They all had to go through probate.
210) Marcia Weinstein died, and her property wasn’t held in a trust. Thus, her estate will go through ______ to ensure her property is distributed to her beneficiaries in accordance with her will.
a. A moderator
b. An attorney
c. Estate planning
d. Probate
211) Under a land trust, the owner directs a ______ to hold title to the real estate.
a. Corporate fiduciary
b. Family member
c. Friend
d. Real estate broker
212) What primary benefit does a living trust have over a will?
a. It avoids probate.
b. It avoids taxes.
c. It’s easier to establish.
d. It’s less expensive.
213) Peter wants to set up a land trust so that his children can benefit from his real estate investments after he dies. He asked his financial advisor Tom to manage the trust, and Tom agreed. How is the trust created?
a. Peter conveys the real estate to Tom.
b. Peter dies.
c. Peter purchases the real estate.
d. Tom distributes income from the real estate investments.
214) Julian and Clara want to leave their real estate holdings to their children. If at all possible, they’d like those holdings to avoid the probate process after they’re deceased. Their attorney recommends a land trust. Is there a type of trust they could establish that would avoid probate?
a. No, all trusts go through probate.
b. Yes, a C trust would avoid probate.
c. Yes, a living trust would avoid probate.
d. Yes, a testamentary trust would avoid probate.
215) Which one of the following statements about testamentary trusts is true?
a. Like living trusts, testamentary trusts avoid probate.
b. Testamentary trusts do not avoid probate.
c. Testamentary trusts do not need to be reviewed by an attorney.
d. The costs of administering a testamentary trust is not borne by the beneficiaries.
216) Martin placed all of his real estate investments in a trust, and the proceeds are distributed through the trust to his son Nathan. Martin still manages the properties indirectly, and Nathan currently benefits, as he’s past the required beneficiary age of 18. What type of trust is this?
a. Indirect trust
b. Living trust
c. Probate trust
d. Testamentary trust
217) Martin placed all of his real estate investments in a trust, and the proceeds will be distributed through the trust to his son Nathan. In this situation, Nathan is the ______.
a. Beneficiary
b. Fiduciary
c. Trustee
d. Trustor
218) In a trust, the trustee is the person who ______.
a. Creates the trust
b. Is empowered to void the trust for any reason
c. Makes sure the terms of the trust are carried out
d. Receives the benefits of the trust
219) Which one of the following statements is true about land trusts?
a. A beneficiary’s interest in the land must be conveyed through a deed.
b. Land trusts generally continue for a specified term, such as 10, 20, or 30 years.
c. The identity of the trust owner is made public.
d. The person who establishes the trust (the trustor) is rarely the beneficiary.
220) Which of the following trusts is created according to the terms of the will of a deceased person?
a. Juvenile
b. Living
c. Tertiary
d. Testamentary
221) XYZ Trust would like to sell its property. Which of the following is the legal title holder?
a. The beneficiary
b. The personal representative of the estate
c. The trustee
d. The trustor
222) Which of the following statements is true regarding trusts?
a. Any asset may be held in a trust.
b. The beneficiary can’t be a minor.
c. The trustee conveys title to the trustor.
d. The trustor is the person who carries out the trustee’s wishes.
223) A living trust differs from a testamentary trust in that a living trust is established to convey property as well as to ______.
a. Dictate terms of care in the event the trust creator becomes incapacitated
b. Hasten the probate process
c. Shelter income from taxation
d. Transfer ownership before death and avoid probate
224) There are many advantages to holding property within a trust. One of the most important advantages is that some trusts ______.
a. Avoid probate
b. Need not be reviewed by an attorney
c. Require probate
d. Typically take years to sort out
225) Henry died, and his property wasn’t held in a trust. Thus, his estate will go through probate to ensure his property is distributed to his beneficiaries in accordance with his will. The probate process often takes ______ before the property is distributed.
a. 20 years or more
b. A few days
c. A few hours
d. A year or more
226) All sorts of trusts, including living trusts, have three parties: a trustee, a trustor, and a beneficiary. In the case of a living trust, the person who places property in trust while still alive for the benefit of another person is the ______.
a. Beneficiary
b. Optee
c. Trustee
d. Trustor
227) When a land trust expires, the trustee must either extend the trust term or sell the real estate and ______.
a. Give all of the proceeds to the attorneys involved
b. Give the proceeds to the beneficiary
c. Give the proceeds to the trustor
d. Retain the proceeds
228) Darren set up a land trust so that his children could benefit from his real estate investments after he dies. He asked his financial advisor Tom to manage the trust. Darren is the ______.
a. Beneficiary
b. Executor
c. Trustee
d. Trustor
229) What type of asset is held in a land trust?
a. Always tillable land
b. Cash
c. Real estate
d. Stocks and bonds
230) Beneficiary interest in land that’s part of a land trust is considered ______.
a. Personal property
b. Protected from creditors
c. Real property
d. Subject to partition
231) Anthony owns a new commercial strip mall with several units. He’s hired Jillian as his agent to find tenants to rent each unit. Is Jillian required to provide Anthony with an agency disclosure form?
a. It depends on how many units are for lease.
b. No, agency disclosure is only required for residential transactions.
c. No, agency disclosure is only required on sales of commercial properties.
d. Yes, Jillian is required to provide Anthony with an agency disclosure form.
232) Rob is searching for a new apartment that he can lease for the next two years while he’s working in the area. He has hired Danielle to represent him as his agent in this transaction. Is Danielle required to provide Rob with an agency disclosure form?
a. No, agency disclosure is only required on leases shorter than one year.
b. No, agency disclosure is only required on sales of residential properties with one to four units.
c. No, Danielle does not provide the agency disclosure to her client. He only provides it to the landlord involved in the transaction.
d. Yes, agency disclosure is required on leases exceeding one year.
233) Simon is a buyer represented by Peter. Peter shows Simon several homes currently on the market. What is Peter’s relationship to the sellers, if he doesn’t represent them?
a. Peter has no relationship with the sellers.
b. Peter is a fiduciary for the sellers.
c. The sellers are Peter’s customers.
d. The sellers are Peter’s principals.
234) Cam is a broker. His licensees, Jane and John, represent two sides in a single transaction. Jane represents the seller; John represents the buyer. What relationship does Cam have to the buyer and the seller?
a. Cam is a designated agent to both the buyer and seller.
b. Cam is a designated agent to the buyer and a dual agent to the seller.
c. Cam is a designated agent to the seller and a dual agent to the buyer.
d. Cam is a dual agent to both the buyer and seller.
235) Rhonda is an unrepresented buyer who’s purchasing Tony’s townhome. Gary represents Tony in the sale of his property. What’s Rhonda’s relationship to Gary?
a. A client and fiduciary
b. A customer
c. A customer and client
d. A fiduciary
236) As Tina’s agent, Marcus has broad responsibility to handle all the details of a specific transaction. What type of agent is Marcus?
a. Dual
b. General
c. Limited
d. Specific or special
237) Stacey, a buyer, is working with Rebecca, a licensee, in a state that doesn’t recognize or permit implied agency. Rebecca doesn’t represent Stacey, however, and is performing only ministerial tasks for her. Which of the following statements about this situation is correct?
a. Rebecca can’t work with Stacey without an agency agreement.
b. Rebecca is acting in an agency capacity for Stacey.
c. Stacey is Rebecca’s client.
d. Stacey is Rebecca’s customer
238) Which of the following lease agreements should be accompanied by an agency disclosure?
a. 15-month lease
b. Nine-month lease
c. Six-month lease
d. Three-month lease
239) Jill is selling her property and hired David as her agent. David brings another client, Kirk, to see the property, which Kirk is interested in purchasing. What kind of agent is David acting as in this scenario?Top of Form
a. A buyer’s agent
b. A dual agent
c. A seller’s agent
d. A sub-agent
240) An unrepresented ______ who’s a party to a transaction is known as a principal.
a. Agent
b. Broker
c. Client
d. CustomerBottom of Form
241) When a licensee has broad responsibility to handle all details of a specific transaction, what type of real estate agency relationship usually exists?
a. Designated
b. General
c. Special
d. Universal
242) You’re holding an open house for Brenda. Walt and Mary walk in and ask you for a flyer that gives details about the property. At this point, what’s your relationship with Walt and Mary?
a. Clients
b. Confidantes
c. Customers
d. Friends Top of Form
243) Which one of the following definitions best describes a consumer?
a. Someone who is hired to act on behalf of a client
b. Someone who is in a position of trust and loyalty
c. Someone who is involved in a transaction but represents neither party
d. Someone who uses or purchases a product or service
244) Which of the following best indicates that Harold is Kelsey’s seller client?
a. At an open house, Harold asked Kelsey about her commission rate and sales track record.
b. Harold and Kelsey talked at a local elementary school event about the real estate market and the possibility of Harold selling his house.
c. Kelsey and Harold have a signed agency agreement.
d. Kelsey cold-called Harold, and he mentioned that he had been thinking of selling his house.
245) Javier represents Marcus, who’s selling his rental property to Ben. Ben is represented by another real estate licensee, Francis. What is Ben’s relationship to Javier?
a. Client and fiduciary
b. Customer
c. Customer and client
d. Fiduciary
246) What types of transactions in California may require agency disclosure?
a. Commercial leases only
b. Residential and non-residential sales and leases
c. Residential leases only
d. Residential sales onlyBottom of Form
247) What’s the term for someone who’s been given the authority to act on behalf of someone else?
a. Agent
b. Client
c. Mortgage lender
d. Trustor
248) Phil is a property manager, which means he serves as a _______ agent to his landlord/client.
a. Designated
b. General
c. Special
d. Universal
249) Jennifer is selling her property and hired Larry as her agent. Jane brings her prospective buyer client, Andrew, to see Jennifer’s property. What is Larry’s role in this scenario?
a. A buyer’s agent
b. A dual agent
c. A seller’s agent
d. A sub-agent
250) Which of the following statements regarding buyer and seller agency is true?
a. A seller’s agent represents the buyer, while the buyer’s agent represents the seller.
b. A seller’s agent represents the seller, while the buyer’s agent represents the buyer.
c. A sub-agent represents the buyer.
d. Seller agents are dual agents.
251) Terry represents seller Farrah, and Michael represents Troy, the buyer. Who is (or are) the principal(s) in this transaction?
a. Farrah
b. Farrah and Troy
c. Terry and Michael
d. Troy
252) Which of the following describes a universal agent?
a. Buyer’s agent
b. Conservator
c. Escrow officer
d. Listing agent
253) Paulo is a property manager for several large properties. Which type of agent is he in relation to the landlord/client?
a. Dual
b. General
c. Limited/special
d. Unlicensed
254) April and Wayne are the buyer and seller of a condo, respectively. April is represented by Steve. Wayne is represented by Wanda. Name the principal(s) in this transaction.
a. April and Wayne
b. Only Wanda
c. Only Wayne
d. Steve and Wanda
255) Listings for sale or lease involving ______ to ______unit residential and commercial properties require agency disclosure in California.
a. One; 10
b. One; 40
c. One; five
d. One; four
256) You have a listing agreement with Sam. Because of this, what is Sam’s relationship to you?
a. Client
b. Confidante
c. Customer
d. Friend
257) Tamron owns a commercial strip mall with several units. She’d like to sell the property and move on to another project. She has hired Christopher as her agent. Is Christopher required to provide Tamron with an agency disclosure form?
a. No, agency disclosure is not required on commercial properties.
b. No, agency disclosure is only required on sales of residential properties with one to four units.
c. No, Christopher does not provide the agency disclosure to his client. He only provides it to prospective buyers.
d. Yes, agency disclosure is required on commercial properties
258) Which of the following is the most serious consequence of treating a customer as a client?
a. Breaching your duty to your actual client
b. Drumming up potential business
c. Wasting your time
d. Working for someone for free
259) In general, what is the term for a person who’s been placed in a position of loyalty and trust?
a. Attorney in fact
b. Client
c. Fiduciary
d. Mortgage lender
260) Which type of agent is an escrow officer?
a. General agent
b. Limited agent
c. Single agent
d. Universal agent
261) Taylor is the owner of a new apartment building. She has 15 units she needs to lease, so she has enlisted Pablo as her agent. Is Pablo required to give Taylor an agency disclosure form?
a. No, agency disclosure is not required for residential transactions involving five or more units.
b. No, agency disclosure is only required for commercial transactions.
c. No, agency disclosure is only required on sales of residential properties.
d. Yes, agency disclosure is required for lease transactions.
262) Gregory is looking for an apartment to rent for six months. He’s hired Franklin as his agent to help with this search. Is Franklin required to provide Gregory with an agency disclosure form?
a. No, agency disclosure is only required for commercial transactions.
b. No, agency disclosure is only required for lease agreements exceeding one year in length.
c. No, agency disclosure is only required on sales of residential properties.
d. Yes, agency disclosure is required for lease transactions.
263) What’s the term for someone who has agency representation with the licensee?
a. Client
b. Consumer
c. Customer
d. Fiduciary
264) Which of these transactions in California is exempt from agency disclosure requirements?
a. 10-year lease of a commercial unit
b. Sale of a 10-unit residential building
c. Sale of a single-family home
d. Two-year lease of a residential unit
265) Melanie is selling her single-family home. She has hired Damian to represent her as her agent in this transaction. Is Damian required to provide Melanie with an agency disclosure form?
a. No, agency disclosure is not required on sales of residential properties with one to four units.
b. No, agency disclosure is only required on leases exceeding one year.
c. No, Damian does not provide the agency disclosure to his client. He only provides it to others involved in the transaction.
d. Yes, agency disclosure is required on sales of residential properties with one to four units.
266) When working with a client on a real estate sale, a real estate licensee is usually acting as which type of agent?
a. Designated
b. General
c. Special
d. Universal
267) In most cases, what type of agent is a real estate licensee when working with a client on a real estate sale?
a. Double
b. Dual
c. General
d. Limited or special
268) Your college friend Dave found out that you have a real estate license, and has asked you to help him put together an offer on his neighbor’s house. You agree. What is your relationship with Dave?
a. Dave is your client.
b. Dave is your customer.
c. Dave is your principal.
d. You are Dave’s customer.
269) After the closing, Donna ensures that her client has keys to the property and copies of all the transaction paperwork. Which fiduciary duty is Donna performing?
a. Accounting
b. Confidentiality
c. Disclosure
d. Loyalty
270) Micah’s client often tells him to do things that Micah doesn’t necessarily agree with and that create a lot more work for him. Micah has multiple clients and can’t spend all of his time doing the bidding of just one demanding client. Micah decides to pick and choose which of his client’s instructions he is going to follow. What might be the consequence if Micah doesn’t fulfill his duty of obedience to his client?
a. Micah may be forced to send the client a written apology.
b. Micah may lose the client’s business.
c. Micah may receive a slap on the wrist from his broker, and be told to shape up or ship out.
d. Micah’s commission may be at risk.
271) In which of these situations did the licensee breach the fiduciary duty of loyalty?
a. Margo tells her seller client Troy that his property is worth less than it really is so he will get a quick sale.
b. Michael submits all offers he receives on Jarrod’s property.
c. Steven postponed his vacation so he could attend his seller client’s closing.
d. Tanaka refuses to encourage his seller client to lower his asking price.
272) Informing parties of material facts related to a transaction describes the duty of ______.
a. Accounting
b. Disclosure
c. Loyalty
d. Reasonable skill and care
273) What happens when two fiduciary duties conflict? For instance, your clients ask you not to show their property on evenings and weekends, when most showings occur. To obey (a fiduciary duty) means to fail in reasonable skill and care (another fiduciary duty). What should you do?
a. Discuss the issue with your clients and let them decide.
b. Obey. It always trumps reasonable skill and care.
c. Refuse to work with these unreasonable clients.
d. Wait until your clients are out of town, then show the property.
274) Which of these situations addresses the fiduciary duty of confidentiality?
a. Jeanette, a seller’s agent, tells the buyer’s agent that her client must sell his home because of an illness.
b. Mark discloses the commission split he receives from his broker to a colleague at another firm.
c. Regina tells her seller client that he’s required to disclose the roof damage.
d. Todd’s lender shares Todd’s financial information with the loan underwriter.
275) Monica meets a colleague from another firm, Kate, for lunch, and discovers that a former seller client, Reuben, is now Kate’s buyer customer. Monica tells Kate, “You know Reuben inherited a bunch of money right before he sold his house, right?” Which of these statements is true?
a. This is a breach of confidentiality because confidentiality survives forever.
b. This is a breach of confidentiality because the information impacts Reuben’s negotiating ability with the seller.
c. This isn’t a breach of confidentiality because Reuben is no longer Monica’s client.
d. This isn’t a breach of confidentiality because the information shared doesn’t negatively impact the client.
276) If an agent fails to perform the duty of obedience, what might the legal consequence be?
a. The agent may be charged with misrepresentation.
b. The agent may be given a verbal warning by his broker.
c. The agent may receive a nasty call from the client.
d. The agent may receive a reduced commission.
277) Norman, the seller’s agent, notices a significant crack in the foundation that the inspector failed to note in the inspection report. Norman decides to keep this information to himself. He really needs to close this deal. Which fiduciary duty has Norman breached?
a. The duty of accounting
b. The duty of disclosure
c. The duty of obedience
d. The duty of reasonable skill and care
278) Specifically, what does the fiduciary duty of disclosure relate to?
a. Adverse material facts and publicly recorded facts only
b. Conflicts of interest and confidential information only
c. Conflicts of interest, material facts, and adverse material facts
d. Material facts and adverse material facts only
279) The duty of confidentiality survives agency unless the information is known from other sources or ______.
a. it will help another client.
b. the former client has moved out-of-state.
c. the former client is found guilty of fraud.
d. the transaction has closed.
280) Carrying out a client’s instructions describes the duty of ______.
a. Accounting
b. Loyalty
c. Obedience
d. Reasonable skill and care
281) Alex’s client doesn’t want prospective buyers to track dirt and mud throughout her clean home. She asks Alex to place a box of booties by the front door with a sign asking visitors to wear the booties while viewing the home. Alex does as his client instructs—no questions asked. What fiduciary duty is this an example of?
a. The duty of accounting
b. The duty of loyalty
c. The duty of obedience
d. The duty of reasonable skill and care
282) When does an agent’s fiduciary duty of loyalty to the client begin?
a. Five days after both parties have signed the agency agreement
b. The moment both parties agree to an agency relationship
c. The moment the client enters into a sales transaction with another party
d. The moment the seller accepts the buyer’s purchase offer
283) Gary’s new seller client is concerned about privacy and doesn’t want her listing posted on the MLS. Gary explains to her the potential impact this will have on marketing her property, but the client remains adamant. Gary doesn’t list the property on the MLS. What fiduciary duty is at play?
a. The duty of confidentiality
b. The duty of disclosure
c. The duty of loyalty
d. The duty of obedience
284) If you fail to notify your client of a conflict of interest, in addition to the duty of loyalty, what other duty have you breached?
a. Confidentiality
b. Disclosure
c. Obedience
d. Reasonable skill and care
285) Nadine is a busy California licensee. She receives an offer for one of her listings, conveyed to her by a buyer’s representative. What’s true Nadine’s obligation to others in this situation?
a. She must be loyal to her client, which means providing the buyer in this transaction with as little care and attention as possible.
b. She owes everyone she comes in contact with, whether they are part of a transaction or not, the duty of reasonable skill and care.
c. She owes her client the duty of reasonable skill and care and must treat the buyer with honesty and fairness.
d. She owes her client the duty of utmost skill and care, and other principals in the transaction (such as the buyer making the offer on her listing) the duty of reasonable skill and care.
286) Your clients closed on their property yesterday, but you still have some paperwork that you need to deliver to them as soon as possible. Under which fiduciary duty are you acting?
a. The duty of accounting
b. The duty of confidentiality
c. The duty of disclosure
d. The duty of obedience
287) What’s one of the most fundamental of all fiduciary duties, and is the one that underlies all other duties?
a. Accounting
b. Disclosure
c. Loyalty
d. Obedience
288) Your buyer client, Ben Dalton, tells you two weeks before closing that he’s lost his job. He doesn’t have any other income at the moment, and may not be able to follow through on his purchase of the house you’re helping him buy. However, he doesn’t want to miss out on his dream home and is optimistic that he’ll find something soon, so he asks you to keep it confidential. What should you do?
a. Disclose this fact to all parties to the transaction if Ben refuses to do so.
b. Keep it confidential, because you owe him that fiduciary duty.
c. Keep it confidential, but only on the condition that Ben promises not to tell anyone he told you, so you can play dumb.
d. Send an anonymous note to the seller’s agent telling him the truth.
289) Select the situation that correctly represents a true conflict of fiduciary duties.
a. Kai learns that her buyer clients’ inspector will be reporting a furnace issue to the buyers. She doesn’t want to break the news to them. Her duty of confidentiality to the seller and her duty of loyalty to her buyers are in conflict.
b. Nikki’s seller client has instructed her not to present offers that are less than the listing price. This is a conflict of Nikki’s duty of disclosure, which requires her to present all offers, and her duty of obedience.
c. Renee’s clients don’t want showings on weekends. Renee knows this may reduce market exposure and she feels it’s not in her client’s best interests. This is a conflict of her duty of loyalty and her duty of obedience.
d. Terrance’s buyer clients don’t want him to share with the seller that they’re having trouble coming up with the down payment. Terrance’s duty of loyalty to his clients is in conflict with his duty of disclosure.
290) Which of the following details may you share with the buyer if you’re the seller’s agent?
a. None of these facts may be shared with the buyer if you’re the seller’s agent.
b. The roof leaks when it rains.
c. The seller is in a hurry to move because his wife is seven months pregnant.
d. The seller is willing to take less than the asking price.
291) Simone can’t believe that her client won’t let her put a lockbox on the property. How does he expect other agents to be able to show the home? Oh well, it’s not as if he’s asking her to do something illegal. The client’s wish is her command. What fiduciary duty is this an example of?
a. The duty of accounting
b. The duty of loyalty
c. The duty of obedience
d. The duty of reasonable skill and care
292) To which of these individuals does California licensee Nadine owe the duty of reasonable skill and care rather than utmost skill and care?
a. Don, a seller, and Betty, a buyer, who have agreed to use Nadine as the dual agent in their transaction
b. Fred, the buyer offering for Ruby’s house, who is represented by another licensee
c. Nicholas, Nadine’s buyer client
d. Ruby, Nadine’s seller client
293) A seller tells his agent that he has to sell his house quickly because of a divorce proceeding, and that he’s willing to accept less than his list price. His agent tells a buyer that the seller will accept as much as $10,000 less than the list price. Which of these is true?
a. The agent has breached his duty of confidentiality to his client.
b. The agent hasn’t violated any fiduciary responsibilities to his client.
c. The buyer is prohibited from making an offer because of the agent’s breach of confidentiality.
d. Unless the agent has the seller’s permission to share this information, the agent should have disclosed only that the seller is willing to reduce his price, not the amount.
294) Henry is Monica’s listing agent. As Monica’s agent, Henry has a duty to account for and properly handle her funds and ______.
a. Financial investments
b. Paperwork
c. Personal savings
d. Property taxes
295) While hosting an open house, Liza speaks with prospective buyers. They’re interested in the house, but think the listing price is a little high. They ask her what other incentives they could include in their offer to get the seller to come down on their price. If Liza helps them, what duty may she be breaching?
a. Accounting
b. Loyalty
c. Obedience
d. Reasonable skill and care
296) You might tell a new client, “This means that I, as the agent, have to keep certain private information you tell me, or that I find out otherwise in our relationship, to myself,” when describing your duty of ______ to the client.
a. Confidentiality
b. Loyalty
c. Obedience
d. Reasonable skill and care.
297) What happens when your client asks you to do something that’s against the law?
a. According to the duty of obedience, you must obey, but document the request.
b. You must break your duty of obedience.
c. You must obey, but ask your client to sign a disclaimer for your actions.
d. You must report your client to the authorities.
298) Which of these would be a breach of Margo’s fiduciary duty of confidentiality?
a. Margo told a potential buyer that the city council was considering rezoning the area around the property to commercial/light industrial.
b. Margo told her seller client Troy the percentage commission split she gets from her broker.
c. Under court order, Margo revealed conversations about the financial status of her previous client.
d. When asked by the buyer’s agent if the seller was firm on his price, Margo said, “Everything’s negotiable,” and winked at the other agent.
299) Shari’s clients want her to post that there are “no showings on weekends” on the MLS. Shari knows that will significantly cut down on their market exposure. Her duty of reasonable skill and care is in conflict with her duty of ______.
a. Accounting
b. Disclosure
c. Loyalty
d. Obedience
300) What does the letter R in the acronym for fiduciary duties (OLD CAR) stand for?
a. Rationality
b. Reasonable skill and care
c. Respect
d. Responsibility
301) Which of these situations is addressed by the fiduciary duty of disclosure?
a. The buyer fails to disclose to the seller his need to close on the property quickly.
b. The buyer’s home inspector refuses to share the inspection report with the seller.
c. The seller refuses to complete a property disclosure form.
d. The seller’s agent fails to disclose a conflict of interest.
302) Which one of the following is an example of the duty of loyalty?
a. Carrying out a client’s instructions without question
b. Keeping a client’s confidential information confidential
c. Never questioning a client’s opinion
d. Putting the client’s interests first
303) Jim represents Joel in the sale of Joel’s country acreage and house. Jim’s business partner, Rolly, informed Jim that he wants to put an offer in to purchase the property, with the intention to subdivide it. Which statement best represents the disclosure requirements regarding this transaction?
a. Because Jim isn’t buying the property for himself, he has no disclosure requirements.
b. Jim may disclose that he’s partners with Rolly, only if Rolly agrees.
c. Jim must disclose that Rolly is his partner and that Rolly intends to subdivide the property.
d. Rolly must disclose that he and Jim are business partners.
304) A client has asked her agent for a 24-hour notice on showings. The agent knows this will have a negative impact on the number of showings. Which duty is in conflict with reasonable skill and care?
a. Accounting
b. Confidentiality
c. Disclosure
d. Obedience
305) Newt’s buyer client isn’t happy with him. The buyer has accused Newt of breaching his duty of ______ by mishandling the earnest money.
a. Accounting
b. Confidentiality
c. Disclosure
d. Obedience
306) Which of these is an example of an agent NOT executing the duty of reasonable skill and care?
a. Kevin, Corinne’s buyer agent, helped her write her offer and reviewed it to make sure it was what she wanted before presenting it to the seller’s agent.
b. Marta agreed to list a commercial property even though her expertise is in residential real estate.
c. Morgan is careful to protect and manage all his client’s earnest money deposits.
d. Rex promptly submits all offers to his seller client.
307) Which fiduciary duty requires agents to handle their clients’ funds and paperwork properly?
a. The duty of accounting
b. The duty of confidentiality
c. The duty of disclosure
d. The duty of obedience
308) Which of these is NOT a duty that California licensees owe to the non-client principals in a transaction?
a. Disclosure of material facts
b. Honesty, fairness, and good faith
c. Loyalty
d. Reasonable skill and care
309) Which of these tasks that Jenna performs does NOT represent the fiduciary duty of accounting?
a. She avoids commingling trust funds with her firm’s operating funds.
b. She discloses the terms of the listing agent’s compensation to her client.
c. She meticulously manages all her clients’ transactional paperwork.
d. She properly records the earnest money her buyer client gave her.
310) Facts that negatively affect a property’s value are known as:
a. confidential.
b. Immaterial facts.
c. Material facts.
d. property fraud.
311) Which of these circumstances does NOT require agent disclosure?
a. As part of his corporation, Sean, a licensee, owns several investment properties. He’s selling one.
b. Gary represents the buyer. He’s a shareholder in the title insurance company the buyer has selected.
c. Marty is representing Dwayne in both the sale of his current home and the purchase of his new home.
d. Megan has listed her brother’s townhome for sale.
312) Which of the following statements about the fiduciary duty of confidentiality is true?
a. It doesn’t extend to material facts relating to the property.
b. It encompasses any and all information the client tells the agent, not just confidential information.
c. It ends with the termination of the agency agreement.
d. It never conflicts with the duty of disclosure.
313) Which of the following is an example of the duty of disclosure?
a. Carrying out a client’s instructions without question
b. Informing parties to the transaction of material facts related to the transaction
c. Keeping a client’s confidential information confidential
d. Keeping the client in the loop on all that is happening with the transaction
314) Jessie, the buyer’s agent, decides to informally inspect the property while she waits for the professional inspection. She notices a small puddle of water in the basement behind a stack of boxes. Later, Jessie calls the seller’s agent and tells him what she found. The agent tells her not to worry; the seller is aware of the leak and plans to have it fixed within the week. Which one of these statements about this situation is true?
a. Jessie can check the basement later to be sure the leak is fixed.
b. Jessie can rely on the inspector to discover and disclose the leak.
c. Jessie should disclose this to her buyer.
d. Since the seller intends to fix the leak, Jessie doesn’t need to disclose it to her buyer.
315) When agents put their clients’ interests ahead of their own, this describes the duty of ______.
a. Accounting
b. Loyalty
c. Obedience
d. Reasonable skill and care
316) Which of the following statements about the fiduciary duty of disclosure is true?
a. It only applies to the seller’s agent.
b. It requires licensees to disclose everything to all parties.
c. It’s owed to other parties, not just to the licensee’s clients.
d. It’s owed to the licensee’s clients only.
317) Which fiduciary duty may continue even after the transaction closes?
a. The duty of accounting
b. The duty of disclosure
c. The duty of obedience
d. The duty of reasonable skill and care
318) Layla, a licensee, has had a few casual meetings with a potential client, Marcus. Marcus has told Layla the type of home and locations he’s interested in. Layla has mentioned a few homes that she thinks Marcus might be interested in. Although Layla hasn’t said that she will continue to look for homes for Marcus, Marcus believes she’ll do just that. Which of these statements about this situation is correct?
a. Because Layla doesn’t know if Marcus is working with another agent, she’s just inadvertently created a dual agency situation.
b. Because Layla has performed some agency tasks for Marcus, she has an express agency agreement with him.
c. Layla and Marcus have no agency agreement, either express or implied, until Layla begins showing Marcus homes.
d. Layla’s actions may have created an implied agency agreement with Marcus.
319) Max has a written agency agreement with Rufus in which Max will receive all of the listings in the subdivision that Rufus purchased (with Max’s representation) and is developing. One day when Rufus is visiting the site of the subdivision, a work truck accidentally runs him over and he’s seriously injured. Rufus can no longer run the development of the subdivision. What happens to Max’s agency coupled with interest?
a. It’s still in place because it doesn’t terminate on the death or incompetence of the principal.
b. Max has no recourse; the agency relationship is terminated and he receives no compensation.
c. Max now owns the subdivision as a result of the principal’s death or incapacity.
d. Rufus must now pay Max the commission that he didn’t get from the original listing, and the agency relationship is terminated.
320) Leigh Ann is a licensee. Her cousin, Carly, is interested in buying a house. Leigh Ann shows Carly how to look for properties online and runs some CMAs for her. When Carly finds a property she likes and asks Leigh Ann to help her make the offer, Leigh Ann decides she should ratify the agreement with Carly. What are Leigh Ann’s options for accepting an agency relationship after the fact?
a. Continue to assist Carly and have her sign an estoppel certificate.
b. Leigh Ann’s only option is to get a signed listing agreement.
c. Prepare an agency agreement or continue to assist Carly with the purchase.
d. Prepare an estoppel certificate and a listing agreement.
321) Elisa agreed to list Simone’s house for sale. After the listing contract was signed, Simone lost her job, and her father, George, offered to help Simone by paying Elisa’s listing commission. The buyer’s agent, Carl, also reduced his commission. Who is Elisa’s client?
a. Carl
b. George
c. No one
d. Simone
322) When the listing agreement’s purpose has been fulfilled, what happens to the agency agreement?
a. Agency continues for future transactions.
b. Agency continues until the agreement’s expiration date.
c. The agency agreement terminates by completion.
d. The agent can renounce the listing agreement to terminate it.
323) Alice listed a three-bedroom home for her client, but before she finds a buyer, the home burns to the ground. What happens to the agency agreement that Alice has with her client?
a. The agency agreement continues as created unless Alice and her client can mutually agree to terminate it.
b. The agency agreement is terminated if the property is destroyed.
c. The agency agreement must be extended until the home is rebuilt, or for six months, whichever is longer.
d. The agreement must continue, but it can be modified due to the changed value of the property.
324) Jenson signed a seller agency agreement with Susan. Right before closing, a hurricane destroyed the property. What happened to Jenson and Susan’s agreement?
a. It’s terminated once the specified term in the agency agreement expires.
b. Jenson and Susan can mutually agree to terminate the agreement.
c. The agreement terminates by force of law.
d. The client can revoke the agreement but may be considered in breach of contract.
325) Which one of the following actions would result in the legal termination of an agency agreement?
a. The client wants the seller to make improvements to the property.
b. The client wants to attach an addendum to the sales contract.
c. There’s an unexpected death in the agent’s family.
d. The term specified in the agency agreement expired.
326) In which of the following listing agreement terminations is there LEAST likely to be a penalty for terminating the agreement?
a. The agent abandons the listing.
b. The client and agent mutually agree to terminate the listing.
c. The client revokes the listing agreement to sell the property to a family member.
d. The seller withdraws the listing, deciding instead to stay in the property.
327) Imagine that you’re an active real estate licensee as well as an architect, and you’d like to partner with a builder who’s just beginning a development. Which of these creates agency coupled with interest?
a. You agree to design the houses for this builder in return for getting the listings when the properties are finished.
b. You agree to list the properties for a reduced commission once they’re built.
c. You have the builder and developer sign listing agreements now that will be effective when the properties are complete.
d. You tell the builder that he has to hire you to design the houses if the builder wants you to list them when they’re finished.
328) In which of these situations would a listing be most likely to terminate due to listing agreement expiration?
a. A market with high inventory and low demand
b. A market with low inventory and high demand
c. A moderately-priced home in a neighborhood slated for renewal
d. A moderately priced home sold as-is in a market full of investors
329) Marcus listed his property with Home Sweet Home Realty and one of its listing agents, Ron Savage. About a month later, Ron filed for bankruptcy. Which of the following statements about this situation is true?
a. Bankruptcy has no impact on agency agreements.
b. Marcus can choose whether or not to continue the listing agreement with Ron.
c. The agency agreement is terminated because the agent filed for bankruptcy.
d. The agency agreement only terminates if the broker or the principal declares bankruptcy.
330) What happens if a real estate licensee acting as a finder performs duties beyond just introducing the buyer and seller?
a. An agency relationship is created. The licensee can face disciplinary action if an agency is formed without proper agency disclosures.
b. Nothing. The person has a real estate license and can perform other duties as needed.
c. The licensee can get in trouble for acting as a dual agent.
d. The licensee is guilty of misrepresentation.
331) You represent the buyer, and another licensee from your brokerage represents the seller in the same transaction. What type of agency relationship do you and the other licensee have with your clients?
a. Buyer agency
b. Dual-licensed dual agency
c. Seller agency
d. Single-licensed dual agency
332) Broker Adeline’s firm has a listing for a condo downtown. Maurice is a cooperating agent. What does this mean?
a. He doesn’t mind working with other brokers.
b. He’s from another brokerage and brings a potential buyer for the listing.
c. He’s the listing agent for the condo and also represents a buyer interested in the condo.
d. He works at Adeline’s firm and is helping to market the condo listing.
333) Which fiduciary duties does a finder owe?
a. A finder doesn’t owe any fiduciary duties.
b. A finder only owes the duties of confidentiality and loyalty.
c. A finder only owes the duty of confidentiality.
d. A finder owes the duties of obedience, loyalty, disclosure, confidentiality, accountability, and reasonable skill and care.
334) Hanna represents the buyer, and Hank, an agent from a different firm, represents the seller in the same transaction. What type of agency relationship does Hanna have with her client?
a. Buyer agency
b. Dual-license dual agency
c. Seller agency
d. Single-license dual agency
335) Estelle is representing seller Margaret. Which of the following tasks is one that Estelle is required to perform as Margaret’s agent?
a. Determine the property’s listing price based on comparables.
b. Give the buyer’s earnest money to Margaret to deposit into her personal checking account.
c. Hire someone to market the property.
d. Inform Margaret about required property condition disclosures.
336) Which of the following is an example of a sub-agency situation?
a. Kayla is a licensee with ABC Realty and lists a property for seller Devon. Maurice is a salesperson with XYZ Realty Group, and he has a buyer customer who wants to see the property.
b. Kermit is represented by Burt, an agent with Street Realty. Today they are seeing Oscar’s house, which has been listed by Oscar’s agent, Ernie, from Energy Realty.
c. Rita is a licensee with Hawthorne Realty. She has a client, Dinah, who is selling her condo. Rita thinks Dinah’s house will be perfect for Ruby, a customer.
d. Tim and Tom are both licensees with Acme Realty. Tim is the listing agent on a home where Tom represents the buyer.
337) Madeline works for a single-agency firm. If she wants to represent both the buyer and seller in a transaction, what must she do?
a. She can’t do this at her firm.
b. She may act as a designated agent for one client and a representative agent for the other.
c. She should get informed consent from both sides to represent them.
d. She should have her broker act as a dual agent, and she can be a single agent for each party.
338) Ned represents Sofia in the sale of her townhome. Luciana represents Sofia’s buyer, Arturo. What is Luciana’s responsibility to Sofia?
a. Assist Sofia in the performance of tasks that Sofia needs to accomplish in order to get to a successful closing.
b. Contact the tax assessor’s office for an estimate of the real property taxes.
c. Disclose that the buyer is a registered sex offender.
d. Disclose that the buyer will not have the funds for the down payment unless he sells his current home.
339) In a seller agency relationship, to which party does the licensee owe undivided loyalty?
a. Both the seller and the buyer
b. The broker
c. The buyer
d. The seller
340) As a licensee, you’ll have several tasks you must perform for your buyer client. One of these tasks is to ______.
a. Coach the buyer on how to negotiate the terms of the sales contract to be completely in the buyer’s favor
b. Explain to the buyer why it’s unnecessary to have a professional inspection done on a new home
c. Review transaction documents with the buyer, clarifying anything that could be confusing, without stepping outside the scope of your license
d. Show properties the buyer might qualify for if he would put down more earnest money
341) Bradley is acting as a finder for Emma. He’s introduced her to Rachel, the other party in the transaction. Whom does Bradley represent?
a. Both Emma and Rachel
b. Emma
c. Neither Emma nor Rachel
d. Rachel
342) If you represent the buyer and seller in the same transaction, what type of agency relationship do you have with your clients?
a. Buyer agency
b. Dual-licensed dual agency
c. Seller agency
d. Single-licensed dual agency
343) Assuming that dual agency is legal where these scenarios occur and that the licensees’ brokerages permit it, which of these situations demonstrates illegal dual agency?
a. Jarrod represents the seller, Juan. A buyer, Alaina, approaches Jarrod about representing her in the purchase of Juan’s house. Jarrod obtains Juan and Alaina’s consent to dual agency.
b. Kady’s firm uses representation agreements that, when signed, provide consent to dual licensee dual agency. Kady’s buyer makes an offer on one of Kady’s colleague’s listings.
c. Levi’s customer, Renee, wants to make an offer on Levi’s seller client’s home. Levi explains that he represents the seller but then presents Renee’s offer to his client.
d. Tom is holding an open house for his client. Ruby, a buyer, says she wants to make an offer. She details her situation; Tom waits until she finishes and then suggests that she offer a non-refundable earnest money deposit to strengthen her offer.
344) What happens if a person without a real estate license is acting as a finder and performs duties beyond just introducing the buyer and seller, such as negotiation or advising?
a. An agency relationship is created. The individual can face disciplinary action if an agency relationship is formed without proper agency disclosures.
b. Nothing. The person is not a licensee and doesn’t face any repercussions from the real estate commission.
c. The individual can get into trouble for acting as a dual agent.
d. The individual could face penalties for acting as a real estate licensee without having a real estate license.
345) Bradley is acting as a finder for Emma. He’s introducing her to Rachel, the other party in the transaction. Which fiduciary duties does Bradley owe Rachel?
a. A finder doesn’t owe any fiduciary duties.
b. He only owes the duties of confidentiality and loyalty.
c. He only owes the duty of confidentiality.
d. He owes the duties of obedience, loyalty, disclosure, confidentiality, accountability, and reasonable skill and care.
346) Licensee Randy has a written listing agreement with Brent, a seller. The buyer is Tim. Who is Randy’s client?
a. Both the seller (Brent) and the buyer (Tim)
b. Randy’s broker
c. The buyer (Tim)
d. The seller (Brent)
347) Natalie is selling her home and has hired Dylan as her agent. Natalie has given Dylan permission to enlist the services of another licensee, Al, to act as a sub-agent for the transaction. Who is liable for Al’s actions?
a. Dylan and Al only
b. Dylan, Natalie, and Al
c. Dylan only
d. Natalie only
348) Who does a finder represent?
a. Both the buyer and seller
b. Neither the buyer nor seller
c. The buyer
d. The seller
349) Orla represents the seller, and Pardeep, an agent from a different firm, represents the buyer in the same transaction. What type of agency relationship does Orla have with her client?
a. Buyer agency
b. Dual-licensee dual agency
c. Seller agency
d. Single-licensee dual agency
350) After a few meetings, the Stinsons sign a listing agreement with broker Vera so she can sell their house. The house has already generated interest from a potential buyer named Sergei, who has spoken with Vera about the house’s price and square footage. Which of the following is true about this situation?
a. Because Vera now has a sub-agency relationship with the Stinsons, she shouldn’t talk to Sergei until the house is officially on the market.
b. The Stinsons and Vera have brokerage relationship agreement.
c. Vera has an agency agreement with Sergei.
d. Vera should disclose the dual agency that has been created by her direct assistance to the buyer
351) Bradley is acting as a finder for Emma. Which action can he perform?
a. Introduce Emma to the seller (or buyer)
b. Negotiate an offer for Emma
c. None of these actions
d. Present the offer on Emma’s behalf
352) In a buyer agency relationship, what relationship does the seller have to the licensee?
a. The seller is the licensee’s client.
b. The seller is the licensee’s customer.
c. The seller is the licensee’s fiduciary.
d. The seller is the licensee’s nemesis.
353) Which of the following questions can an agent in a dual agency transaction answer without breaching her duties to either client?
a. Are you aware of any structural issues with the property?
b. How much should my counter-offer to the buyer be?
c. What repairs or concessions should I ask for from the home inspection?
d. What should I agree to fix from this list the buyer sent?
354) A middleman is another term for a _______.
a. Finder
b. Keeper
c. Universal agent
d. Wholesaler
355) Mavis is a buyer’s agent working with Blaine, an unrepresented seller. Mavis’s buyer, Cintra, makes an offer on Blaine’s property. Mavis assists Blaine with the paperwork. What’s Mavis’s relationship to the parties?
a. She’s a buyer’s agent to Cintra and an undisclosed dual agent with the seller.
b. She’s a dual agent to the buyer and seller.
c. She’s an agent to Cintra, and the seller is her customer.
d. The seller and buyer are her customers.
356) When a licensee represents a seller, which one of the following statements is true about the licensee’s ability to list other properties that are for sale?
a. The licensee isn’t permitted to list other properties for sale.
b. The licensee is permitted to list other properties for sale as long as they’re not competing properties.
c. The licensee is permitted to list other properties for sale, even if they’re competing properties.
d. The licensee must list the seller’s property only for the first 90 days, after which the licensee may list other properties.
357) A licensee has several tasks to perform for seller clients. What’s one of those tasks?
a. Advise sellers on the property conditions they shouldn’t disclose to the buyer.
b. Communicate all offers and counter-offers to the sellers.
c. Disclose to the sellers that if the property doesn’t sell within 60 days, the asking price must be lowered.
d. Ensure an implied agency agreement is in place.
358) Erik is acting in a single agency capacity in a transaction. What does this mean?
a. Erik isn’t part of a realty team within his brokerage firm.
b. He’s representing (and owes undivided loyalty to) either the buyer or the seller.
c. He’s working as a non-agent for either the buyer or seller.
d. His firm doesn’t allow dual agency.
359) Bradley is a real estate licensee acting as a finder for Emma. What happens if he performs duties beyond just introducing the buyer and seller, such as negotiating a deal?
a. An agency relationship is created. Bradley can face disciplinary action if an agency is formed without proper agency disclosures.
b. Bradley is guilty of misrepresentation.
c. He can get in trouble for acting as a dual agent.
d. Nothing. He has a real estate license so he can perform other duties as needed.
360) Which one of the following tasks must licensees perform for seller clients?
a. Dictate the listing price of the property.
b. Drive the sellers around to show them other properties that are for sale in their neighborhood.
c. Ensure that the buyer’s earnest money is deposited.
d. Show the sellers how they can market their property.
361) A licensee must perform which of the following tasks for a buyer client?
a. Ensure the buyer understands the importance of due diligence, including a professional inspection of the property.
b. Review the seller’s property disclosures and show the buyer the ones that you believe are important.
c. Show the buyer properties that you are listing for other sellers.
d. Tell the buyer how much earnest money she should put down to ensure the deal goes through.
362) What is a sub-agent?
a. An agent appointed by another agent to assist in serving a seller client
b. An agent who handles the listing for a seller
c. An inexperienced agent
d. Anyone who works for a broker
363) Buyer Kristin has a buyer agency agreement with Carlotta, a licensee. Kristin’s brother, Dalton, is going to showings with Kristin and helping her decide which house is the best fit. Who is/are Carlotta’s client(s)?
a. Kristin
b. Kristin and Dalton
c. Kristin and the seller
d. The seller
364) A finder is a _______.
a. General agent
b. Limited agent
c. Middleman
d. Universal agent
365) Melinda is selling her home and has hired Megan as her agent. Megan enlists the services of another licensee, Alison, to act as a sub-agent for the transaction without permission from Melinda. Who is liable for Alison’s actions?
a. Megan and Alison only
b. Megan, Melinda, and Alison
c. Megan only
d. Melinda only
366) Marge is a licensee in a dual agency transaction with seller Steven and buyer Alda. In which of the following situations can Marge share what she knows with all parties without compromising her duty of loyalty?
a. Alda tells Marge she wants to make an offer on Steven’s property and asks Marge what she should offer, since Marge knows Steven’s rock-bottom price.
b. Alda tells Marge that she’s hired an inspector to perform a property inspection.
c. During the home inspection, Marge hears the buyer tell the inspector several times, “That’s no big deal. I can fix that.” The buyer lists those as repairs she wants the seller to make.
d. Steven tells Marge he can reduce his price, and Alda tells Marge she can increase her offer.
367) In a buyer agency relationship, whom does the licensee represent?
a. Both the seller and the buyer
b. The buyer
c. The listing firm and the buyer
d. The seller
368) Bradley is acting as a finder for Emma. What’s Bradley’s role?
a. To help buyers and sellers locate agents
b. To introduce the buyer and seller, but not provide representation
c. To investigate title issues
d. To try to locate the prior owners of a specific property
369) A person who doesn’t owe either party any fiduciary duties and only introduces the buyer and seller is called a ____.
a. Finder
b. General agent
c. Limited agent
d. Special agent
370) Ryan is an unlicensed individual acting as a finder for Rachel. What happens if he performs duties beyond just introducing the buyer and seller, such as negotiating a deal?
a. An agency relationship is created. Ryan can face disciplinary action if an agency is formed without proper agency disclosures.
b. Nothing. Ryan is not a licensee, so he doesn’t face any repercussions from the real estate commission.
c. Ryan can get in trouble for acting as a dual agent.
d. Ryan could face penalties for acting as a real estate licensee without having a real estate license.
371) What responsibility does the seller’s agent have to the seller?
a. Advocate for and ensure the sale is profitable for the seller.
b. Advocate for the seller and help present the property in the best light, even if it means covering up material defects.
c. Ensure the sale is profitable for the seller.
d. Seek a sale at the best price at terms that are acceptable to the seller.
372) Which of the following is a buyer’s agent’s task or duty?
a. Advocating for the seller
b. Negotiating for the seller
c. Representing the buyer’s interests
d. Reviewing transactional documents with the seller
373) Which one of the following provides the best example of single agency?
a. A broker acts as a dual agent to one party only.
b. An agent from one firm acts as the agent for the buyer.
c. Two agents from different firms each act as a sub-agent for the other.
d. Two agents from one firm act, separately, as the agent for the buyer the agent for the seller.
374) Monica’s business is booming. She’s representing an owner who’s selling a $500,000 home on one side of town, and a buyer who’s purchasing a $300,000 property on the other side of town. As it happens, the seller and buyer both know each other from church and have been talking to others about Monica’s talents, which has brought in several new leads for her to pursue. What type of agency relationship does Monica have with the seller and buyer?
a. She is each party’s single agent.
b. She’s a dual agent, since the seller and buyer know each other.
c. She’s the buyer’s agent and the seller’s sub-agent.
d. She’s the seller’s agent and the buyer’s sub-agent.
375) Which of these situations is an example of designated (appointed) agency?
a. Jacob, a broker, acts as the dual agent and appoints Mark to represent the buyer and Todd to represent the seller in the same transaction.
b. Marvel’s broker at Homeworks Realty appoints her as the buyer’s agent in a transaction. Tim’s broker at Great Homes Real Estate appoints him as the seller’s broker in the same transaction.
c. Meredith’s broker appoints her to represent both the buyer and the seller in a single transaction.
d. Michele is the firm’s managing broker. She’s the designated dual agent in all dual agency transactions.
376) Which action can a finder perform?
a. Introduce the buyer and seller
b. Negotiate an offer for a client
c. None of these actions
d. Present the offer on a client’s behalf
377) Camille has a listing for a townhome, and appoints Ivy as her sub-agent. Ivy brings a buyer customer to the transaction, and the buyer purchases Camille’s listing. What’s true about the agency relationships in this situation?
a. Camille owes her loyalty to Ivy.
b. Ivy is Camille’s sub-agent and owes loyalty to the seller.
c. Ivy owes her loyalty to the buyer.
d. The buyer is the sub-agent to the seller.
378) Which of these tasks must a licensee perform for buyer clients?
a. Advise the buyer on how to get the seller to come down on the asking price.
b. Ensure that the buyer receives copies of all signed paperwork.
c. Explain to the buyer how to deposit the earnest money into the seller’s personal checking account.
d. Explain to the buyer that there’s really no need to review transaction documents because they’re all standard.
379) You’re representing Abe and Ben in a dual agency situation. Abe tells you something that would give Ben a distinct advantage if he knew. Do you tell Ben?
a. No, because agents can’t share information with their clients.
b. No, because it’s hearsay.
c. No, because you can’t share one client’s confidential information with another client.
d. Yes, because Ben is your client and has a right to know.
380) Which legal description method uses compass headings and directions?
a. Block and grid
b. Lot and block
c. Metes and bounds
d. Rectangular government survey
381) “Beginning at a stake and stones about 30 feet from the center of the brook that runs across the road Southwesterly from the dwelling house of the late Henry Nelson …” is an example of what type of legal description?
a. Benchmark
b. Lot and block
c. Metes and bounds
d. Rectangular
382) Which entity decides the matter when two different legal descriptions conflict?
a. Appraisers
b. Land surveyors
c. The courts
d. The property owners
383) Travis is a new real estate licensee and is writing up his first offer to purchase for his buyer clients. Which of these statements is true?
a. Real estate licensees don’t have access to legal descriptions.
b. Travis should include the legal description in the offer, because it provides a complete description of the property.
c. Travis should not include the legal description on the offer to purchase, but he should include the address.
d. Travis shouldn’t write up the offer to purchase; the client should.
384) Which of these may have been used as a point of beginning in the metes and bounds system?
a. A fence post
b. All of these
c. An iron stake
d. A pine tree
385) A registered land surveyor is preparing a plat map that will show elevations and boundaries for a multi-level condominium complex. What is used as a reference point for measuring elevation?
a. Datum
b. Monument
c. Point of beginning
d. Sea level
386) Morty, a land surveyor, was called out to survey a property. After doing some research, he located the legal description for the property in question. Now, if he could just find the point of beginning located at the iron pin on the southerly line of state route 117, 30 feet east of the oak tree next to Bear Creek. What type of legal description is Morty working with?
a. Benchmark
b. Datum
c. Metes and bounds
d. Rectangular government survey
387) What’s a datum?
a. An iron pin or other permanent marker used in metes and bounds descriptions
b. A point indicating a location is at sea level
c. A point, surface, or line used as a reference for measuring elevations
d. The center of a township
388) Sunshine Surveyors, Inc. created a lot and block survey for a new residential development, Happy Acres. The first thing the surveyor did when he surveyed the new neighborhood was to reference what type of description?
a. Map
b. Metes and bounds description
c. Monument
d. Plat book
389) Cheri wants to find the legal description for her property. Where could she look?
a. At a deed
b. In a history book
c. In a phone book
d. On a piece of mail
390) Which of the following is NOT one of the three most commonly used systems to describe land in the U.S.?
a. Lot and block
b. Metes and bounds
c. Monument system
d. Rectangular survey system
391) When looking at a rectangular survey system map, where would Section 36 be located?
a. The exact center of the township
b. The northeastern-most section of the township
c. The southeastern-most section of the township
d. The southwestern-most section of the township
392) What is a principal meridian?
a. An east-west line used as a reference point in the rectangular survey system
b. A north-south line used as a reference point in the rectangular survey system
c. The center-most section identified in the rectangular survey system
d. The center-most township identified in the rectangular survey system
393) Who can verify the boundaries of a legal description for a given property?
a. Anyone with a smart phone
b. Designated broker
c. Land surveyor
d. Title company
394) Pamela inherited a piece of property that has been in her family for generations. She wants to find the property’s exact boundaries. What should contain this information?
a. A fence company’s records
b. A legal description of the property
c. A satellite image of the property
d. Old family photos of the property
395) Buyers Tony and Sylvia know the postal address of the property they’re purchasing but are wondering about the legal description of the property. Where is the most likely place to find the legal description?
a. Deed
b. HOA covenant
c. Home warranty
d. Listing agreement
396) The Simpsons are buying a five-acre lot that was part of a much larger tract of acreage. When the owners of the large acreage decided to subdivide it, they needed to have a legal description created for the five-acre lot. What was used as the starting point for creating that legal description?
a. A benchmark
b. A plat map
c. A survey
d. Metes
397) What does the metes and bounds system use to develop a property’s legal description?
a. Compass headings and directions
b. Plat references
c. Principal meridians and base lines
d. Townships and sections
398) Related to the legal description of land, what is a monument?
a. 43,560 square feet
b. A permanent land marker sometimes used in legal descriptions
c. A point from which elevations are measured
d. The subdivision of air above the land
399) How is the grid that’s used in the rectangular survey system laid out?
a. The numbers are read left to right.
b. The numbers are read right to left.
c. The numbers start in the center and spiral out clockwise.
d. The numbers start in the northeastern corner and follow a zigzag pattern.
400) Absent a legal description, what are other ways to identify a property?
a. A legal description is the only way to identify a property
b. Family photos
c. Satellite imagery
d. Street addresses and tax map personal identification numbers
401) Which of the following is a key consideration and starting reference for a metes and bounds description?
a. Base line
b. Benchmark
c. Point of beginning
d. Principal meridian
402) Why is it important that the legal description appears in real estate documents?
a. It defines the duties an agent owes a client.
b. It details the terms for a lease.
c. It outlines all of the terms of a real estate purchase.
d. It precisely locates the property and its boundaries.
403) Which of the following is the least specific method for describing a property?
a. Lot and block description
b. Metes and bounds description
c. Rectangular survey system description
d. Street address
404) How large is a section used in the rectangular survey system?
a. 640 acres
b. 640 miles
c. 640 square feet
d. One acre
405) What does the lot and block system use to develop a property’s legal description?
a. Compass headings and directions
b. Plat references
c. Principal meridians and base lines
d. Townships and sections
406) Kellan and Stacy are in the midst of a property dispute. Each party has a legal description and survey that show conflicting boundaries between their properties. What may be the best way to resolve this dispute?
a. One property owner can sell their property to the other.
b. They must agree between themselves where the true boundary lies.
c. They must take the dispute to court.
d. They should each hire a land surveyor to determine the boundary.
407) Shannon is reading through paperwork related to her upcoming home purchase when she comes across the following: “Southwest quarter of Southwest quarter (SW ¼ of SW ¼) and West Half of Southeast quarter of Southwest quarter (W½ SE¼ SW¼) of Section Eleven (11), Township Four (4) North of Range Eight (8) West.” What did Shannon just find?
a. Legal description
b. Mortgage clause
c. Quitclaim deed
d. Tax description
408) If the land is described as “Lot 6 of Block 3 of the East Subdivision plat as recorded in Map Book 18, Page 11 at the Recorder of Deeds,” what type of legal description is being used?
a. Lot and block
b. Metes and bounds
c. Monument system
d. Rectangular government survey system
409) What is a bound?
a. A line that runs east to west
b. A line that runs north to south
c. A physical feature that defines the boundaries of the land
d. The direction and distance of a line forming the boundary of a property
410) What is a plat map?
a. A detailed depiction of air lots above the land
b. A detailed map of a subdivision that includes boundaries, measurements, and distances between points
c. A map showing all of the benchmarks located in the U.S.
d. A map tax assessors use when determining the value of a property
411) What is a section?
a. A 36-square-mile square formed in the use of the rectangular survey system
b. A one-square-mile square formed in the use of the rectangular survey system
c. A permanent reference point used in the measurement of elevations
d. The point of beginning used in a metes and bounds survey
412) Which of the following statements related to condominiums and surveys is true?
a. All states require that land used for condominiums be surveyed by a registered land surveyor and that a plat map be prepared to show the elevations of the floor and ceiling boundaries, as well as the vertical boundaries of each unit.
b. Condominiums are not required to be surveyed.
c. Multi-level condominium units cannot be surveyed.
d. Only the ground floor of a condominium unit is surveyed.
413) The process of determining the location, size, and boundaries of a parcel of property is called ______.
a. Platting
b. Subdividing
c. Surveying
d. Title searching
414) Jamie wants to find the legal description for a property. What’s her best bet?
a. County recorder’s office, registry of deeds, or a title company
b. Motor vehicle department
c. Neighborhood notice
d. Real estate flyer
415) Which type of legal description is this: “Plat of Block 28, Woodmen Heights Tract, recorded in Map Book 27, page 68, at the Eldor County Records Office”?
a. Benchmark
b. Lot and block
c. Metes and bounds
d. Rectangular government survey
416) Brandon is interested in purchasing a piece of property, but before doing so, he’d like to verify the accuracy of the legal description. Which of these options will accomplish this?
a. Having a home inspection performed
b. Having an appraisal performed
c. Having a survey conducted
d. Looking up the property on Google
417) What is the oldest type of legal description used in the U.S.?
a. Assessor’s parcel number
b. Lot, block, tract
c. Metes and bounds
d. Rectangular government survey
418) In the rectangular survey system, what is a base line?
a. An east-west line used as a reference point
b. A north-south line used as a reference point
c. The center-most section identified
d. The center-most township identified
419) How are sections and townships related to one another, relative to the rectangular government survey system?
a. Sections are divided into townships.
b. Townships and sections are opposites.
c. Townships and sections are synonyms.
d. Townships are divided into sections.
420) When Shauna looked at the legal description of the property she was interested in purchasing, she read the following: “Beginning at the corner of State Route 61 and Hallowell Road, north for 314 feet, then southwest for 193 feet.” In this description, what does “north for 314 feet” represent?
a. A benchmark
b. A bound
c. A mete
d. A monument
421) Which type of legal description do courts prefer?
a. Benchmark
b. Lot and block
c. Metes and bounds
d. Rectangular government survey
422) If the land is described as “Beginning at the great oak 60 yards from the center of the Rock River that runs north to south through the county,” what type of legal description is being used?
a. Lot and block
b. Metes and bounds
c. Monument system
d. Rectangular survey system
423) Benjamin is interested in a piece of property but is curious about its exact legal description. What’s one of the best ways to find this information?
a. Ask neighbors where the property boundaries are.
b. Look for the point of beginning.
c. Look up the latitude and longitude coordinates of the property on Google Maps.
d. Reference a previous property deed.
424) Harmony is looking at the legal description on her purchase contract. It mentions that the plat of her property is recorded in Map Book 12, page 14, at the county courthouse. What type of legal description is this?
a. Lot and block
b. Metes and bounds
c. Monument and benchmark
d. Rectangular government survey
425) Which legal description method is regulated by the U.S. Department of the Interior’s Bureau of Land Management?
a. Governmental
b. Lot and block
c. Metes and bounds
d. Rectangular government survey
426) Stan and Emile are arguing over their shared lot line, since Stan thinks that Emile planted a privet hedge on Stan’s property. Stan filed a civil legal action against Emile. Which of these would the court use to determine the actual lot line?
a. Aerial photographs
b. An affidavit from a surveyor
c. Legal descriptions of both properties
d. Testimony from long-time neighbors
427) Which type of survey system is also known as the public land survey system (PLSS)?
a. Address and zip code
b. Lot and block
c. Metes and bounds
d. Rectangular survey
428) When measuring elevations, what is used instead of a point of beginning?
a. Datum
b. Equator
c. Monument
d. Sea level
429) A drawing prepared by a surveyor showing the layout and location of a tract of land, including boundaries, designations of lots and blocks, and names of streets, is called a ______.
a. Metes and bounds description
b. Plat
c. Rectangular survey
d. Topographical map
430) A professional, on-site measurement of the lot lines and dimensions of a property is known as ______.
a. An abstract
b. An appraisal
c. An inspection
d. A survey
431) Which of the following is the best definition of a township?
a. A 36-square-mile square formed when using the rectangular survey system
b. A one-square-mile square formed when using the rectangular survey system
c. A permanent reference point used in the measurement of elevations
d. The point of beginning used in a metes and bounds survey
432) A surveyor created a lot and block survey for a new residential development. The first thing she did when she surveyed the new neighborhood was to reference a metes and bounds land description. From there, she divided the land into numbered lots and blocks. This output is known as a ______.
a. Benchmark
b. Monument
c. Plat map
d. Rectangular survey
433) Datums and benchmarks are used for ______.
a. Calculating area
b. Determining land acquisition costs
c. Measuring distance
d. Measuring elevations
434) What is a sketch that shows the location, size, and shape of any improvements on a property being surveyed?
a. Building plan
b. Legal description
c. Plat reference map
d. Spot survey
435) What is the starting point for any land surveyor who has been asked to perform a survey?
a. A review of existing historical records
b. Satellite photos
c. The point of beginning
d. Visiting the site
436) What does a land surveyor produce?
a. A determination of value of a property
b. A report detailing defects of a property
c. A survey that includes a legal description and a survey sketch
d. Property boundaries
437) Which of these is usually a brass marker that is used to mark a datum?
a. Base line
b. Benchmark
c. Monument
d. Principal meridian
438) Jenna’s closing agent has asked her to get a spot survey of the property she’s purchasing. What will this accomplish for Jenna and the closing agent?
a. It decides the location of the point of beginning.
b. It notes the location of major appliances and features inside a home.
c. It notes the location, size, and shape of any improvements on a property.
d. It’s provides a sketch based upon driving by the property.
439) Which of the following are possible effects of an incorrect legal description?
a. Clearer title for the property owners
b. Fewer legal issues for real estate licensees
c. No effect
d. Unintentional encroachment, title and legal issues
440) A ______ is a point, surface, or line used as a reference for measuring elevation.
a. Base line
b. Datum
c. Monument
d. Principal meridian
441) For what are datums and benchmarks used?
a. Calculating area
b. Determining land acquisition costs
c. Measuring distance
d. Measuring elevations
442) What’s the permanent marker used primarily for marking datums when measuring elevation?
a. Benchmark
b. Monument
c. Point of beginning
d. Sea level
443) What describes the different symbols that are used in a survey sketch?
a. Legal description
b. Spot survey
c. Survey legend
d. Surveyor’s stamp
444) What’s the point from which elevation is measured?
a. Base line
b. Datum
c. Monument
d. Principal meridian
445) What signifies that a survey is certified and represents a guarantee of accuracy?
a. Spot survey
b. Survey legend
c. Surveyor’s stamp
d. Title insurance policy
446) A lot measuring 108,900 square feet is for sale. How many acres is this?
a. Five
b. One
c. Three
d. Two-and-a-half
447) If a farm that’s for sale measures one and three-quarter square miles, how many acres is it?
a. 1,050
b. 1,120
c. 1,280
d. 875
448) A parcel of land measures one half mile by 3,000 feet. If price per acre is $4,200, what’s the list price for this parcel? Round to 10ths of an acre for your calculation.
a. $1,527,273
b. $752,066
c. $756,000
d. $763,560
449) The cost of a parcel of land is 50 cents per square foot. Candace wants to purchase one acre. How much will this cost?
a. $21,780
b. $43,560
c. $500
d. $5,000
450) How many acres are in a square mile?
a. 1,760
b. 43,560
c. 5,280
d. 640
451) James purchased five acres of land for $75,000. What was the cost per acre?
a. $15,000
b. $25,000
c. $375,000
d. $5,000
452) How do you determine the cost of purchasing land?
a. Divide the cost per unit by the land area
b. Divide the land area by the cost per unit
c. Multiply the land area by $100 per acre
d. Multiply the land area by the cost per unit
453) How many square feet are in an acre?
a. 10,000 square feet
b. 43,560 square feet
c. 53,640 square feet
d. 640 square feet
454) How long is a mile?
a. 1,000 feet
b. 1,000 yards
c. 43,560 feet
d. 5,280 feet
455) Gabi owns one parcel measuring one square mile and another parcel measuring one mile by a half mile. She combined the parcels and sold them for $2.5 million. What price per acre did she receive for the land?
a. $1,953.13
b. $2,604.17
c. $3,125.00
d. $3,906.25
456) How many feet are in a mile?
a. 2,400
b. 320
c. 5,280
d. 6,044
457) How many acres are in a quarter section in a rectangular survey?
a. 160
b. 450
c. 640
d. One
458) A property is 330 feet long by 100 feet wide. How many square feet is the property?
a. 10,300
b. 30,000
c. 3,300
d. 33,000
459) An 800-square-foot rectangular building sells for $75,000. What’s the cost per square foot?
a. $187.50
b. $46.88
c. $60.50
d. $93.75
460) A seller received $800,000 for a 5.5 acre rectangular parcel alongside a road frontage. The property is 400 feet deep. What was the price per front foot of the property?
a. $1,335.67
b. $2,000
c. $363.64
d. $598.95
461) Margie needs to know the square footage for the first floor of the condo her client is interested in buying. The kitchen is 10 feet by 15 feet, the living/dining combo is 20 feet by 25 feet, and the office and bedroom are each 10 feet by 10 feet. What’s the total square footage?
a. 2,200 square feet
b. 3,000 square feet
c. 750 square feet
d. 850 square feet
462) Your client Frank is interested in selling a 54,450-square-foot lot. A comparable property in the vicinity sold for $3,500 per acre. What would be reasonable list price for Frank’s property?
a. $3,500
b. $4,375
c. $4,955
d. $5,250
463) Alana and Michael want to build a 5,000-square-foot ranch home on two acres of land they just bought. Once the house is built, how many acres of land will remain unbuilt?
a. 0.88 acres
b. 0.89 acres
c. 1.86 acres
d. 1.89 acres
464) Your client, a builder, is considering buying three adjacent lots. They each have the same depth: 275 feet. Lot A is 35,750 s.f., Lot B 53,900 s.f., and Lot C is 33,000 s.f. If your client buys all three lots, what total street frontage will he have?
a. 446 feet
b. 462 feet
c. 464 feet
d. 466 feet
465) How much would a lot that is 400 feet wide by 500 feet long cost at $900 per acre?
a. $2,200
b. $3,060
c. $4,132
d. $4,500
466) A four-bedroom, four-bath, 4,875-square-foot house was listed at $445,000. Andreas, the seller, accepted an offer that was 95% of the listing price. What price per square foot did he get for the house?
a. $45.64
b. $82.15
c. $86.72
d. $93.00
467) A lot measuring three-fourths of an acre is for sale. How many square feet is this?
a. 10,890
b. 14,520
c. 32,670
d. 43,560
468) Clint is interested in making an offer on a house with hardwood floors that will need to be replaced. The hallway is 18 feet by 6 feet. The kitchen is 20 feet by 30 feet. The living room is 25 feet by 45 feet. There are two bedrooms, which measure 12 feet by 16 feet each, plus a master bedroom that is 14 feet by 20 feet. If the cost of the flooring is $5.48 per square foot, and the cost of installation is $1.49 per square foot, how much can Clint plan to spend to replace the floors?
a. $13,683.56
b. $16,065.85
c. $16,309.80
d. $17,404.09
469) An area of 640 acres is equal to ______.
a. One hectare
b. One kilometer
c. One square mile
d. One township
470) When a city is determining zones, what should be followed?
a. Construction standards
b. Federal zoning codes
c. State zoning codes
d. The comprehensive plan
471) When a California planning board is developing a general plan for an area, which of these elements is it NOT required to consider?
a. Housing for a variety of income levels
b. Noise control
c. Ratio of business, industrial, and residential spaces
d. Standards for land use and density
472) When the planning board gets together, Carl focuses on commercial aspects, Renee focuses on residential areas, and Arthur focuses on agricultural spaces—all without any insight from one another. What type of planning is this?
a. Form-based planning
b. Integrated planning
c. Pocket planning
d. Traditional planning
473) Spark City has built a new city courthouse. The construction caused a landslide, which buried most of Joe’s farmland; now it can no longer be used for farmland. Joe is bringing an action against the city for his property loss. What is this an example of?
a. Condemnation
b. Eminent domain
c. Foreclosure
d. Inverse condemnation
474) The Johnsons have owned a small restaurant for more than 20 years. It’s open for lunch and dinner six days a week, and 80% of its weekday revenue comes from the happy hour drink and appetizer specials. The town in which their restaurant is located recently constructed a new middle school and stripped the liquor license from the Johnsons’ restaurant, because it no longer complies with the ordinance to be 500 feet from a school property. The Johnsons have accused the town of _____.
a. Condemnation
b. Eminent domain
c. Escheat
d. Inverse condemnation
475) Police power is the government’s authority at what level(s)?
a. At any level
b. Federal only
c. Local only
d. State only
476) Which statement best describes traditional planning?
a. Developers identify how land will be used.
b. Residents determine how land will be used.
c. Specialists with different areas of expertise work separately and focus on designing “their” areas.
d. Specialists with different areas of expertise work together, focusing on overall use.
477) _________ is the power of the government to take private land for public use.
a. Eminent domain
b. Encumbrance
c. Escheat
d. Foreclosure
478) At what level of government are budgeting, site plan review, and building codes controlled?
a. Federal
b. Federal and state
c. Local
d. State
479) The Kelo vs. City of New London U.S. Supreme Court ruling was controversial because the U.S. Constitution prohibits the government from taking private property except for “public use”. What governmental power was central to this case?
a. Eminent domain
b. Escheat
c. Police power
d. Taxation
480) The power of ______ was commonly used by community redevelopment agencies (CRAs) to acquire blighted properties.
a. Condemnation
b. Eminent domain
c. Escheat
d. Inverse condemnation
481) What’s inverse condemnation?
a. It occurs when a property owner dies without a will, heirs, or creditors.
b. It occurs when government actions deprive a property owner of the value of the property without offering just compensation.
c. It occurs when municipalities pass enabling acts.
d. It occurs when the government places a lien on a property due to failure to pay taxes.
482) When government regulation causes a land owner’s property to decrease in value, it’s called ______.
a. Condemnation
b. Eminent domain
c. Escheat
d. Inverse condemnation
483) Under what type of police power is a property owner compensated for the loss of property?
a. Eminent domain
b. Escheat
c. Riparian
d. Taxation
484) Which agency administers the Interstate Land Sales Full Disclosure Act?
a. Consumer Financial Protection Bureau
b. Department of Energy Conservation
c. Developers Land Sales Act
d. Housing and Urban Development
485) A ______ is created after a jurisdiction’s general plan is adopted. It provides more detailed information and aids in the implementation of the general plan.
a. Development plan
b. General plan
c. Specific plan
d. Zoning map
486) Adams County implemented a 10 p.m. curfew for youths under age 18 because of the high number of fights that have been occurring late at night in public places. Which of the following gives Adams County the right to restrict the movements of its minor citizens?
a. Doctrine of laches
b. Municipal master plan
c. Police power
d. Power of escheat
487) What type of police power allows cities to identify specific uses for an area?
a. Condemnation
b. Eminent domain
c. Escheat
d. Zoning
488) In the movies, a shady salesperson might say “I have some great farmland to sell you in the Midwest; just take a look at this brochure and let me know if you’d like to buy!” The federal government passed a law to prevent such fraudulent sales of property sight unseen. What is that law?
a. Interstate Citizens Protection Act
b. Interstate Land Sales Full Disclosure Act
c. Police Power Act
d. Subdivision Act of 1997
489) The government’s authority at all levels to ensure the health, safety, and welfare of its citizens, which includes the control of public land use, is the definition of ______.
a. Condemnation
b. Eminent domain
c. Police power
d. Sovereignty
490) Which of the following is a true statement about police power and public land use controls?
a. Government agencies may exercise police power only when it does not restrict the freedom of its citizens.
b. Local governments and their planning boards control budgeting, site-plan review, and building codes.
c. Planning, zoning, and subdivision development are primarily controlled at the state level.
d. Police power is citizens’ rights to police themselves.
491) When it came time to plan the city, Arlene (the agriculture specialist), Robert (the residential guru), and Carmen (the commercial genius) all locked themselves in a room and planned the area together. What type of planning is this?
a. Form-based planning
b. Integrated planning
c. Pocket planning
d. Traditional planning
492) Local authorities lack police power over which of the following?
a. Budgeting
b. Federal government construction projects
c. Subdivision development
d. Zoning
493) What police power did community redevelopment agencies (CRAs) use?
a. Condemnation
b. Eminent domain
c. Escheat
d. Inverse condemnation
494) After a general plan is developed, what is the next step in the adoption process?
a. Developers bid on areas they would like to develop.
b. Residents vote on the plan.
c. The plan is reviewed at a public hearing by the local legislative body.
d. The plan is reviewed at a public hearing by the planning commission.
495) The Kelo vs. City of New London U.S. Supreme Court ruling was controversial because the U.S. Constitution prohibits the government from taking private property except for “public use”. What governmental power was central to this case?
a. Eminent domain
b. Escheat
c. Police power
d. Taxation
496) Can police power ever be used in a way that restricts citizens’ freedom?
a. No, that’s beyond the scope of police power.
b. Yes, but only when the citizen has committed a crime.
c. Yes, if it’s for the public good.
d. Yes, that’s the purpose of police power.
497) The process in which the government actually takes someone’s property through the power of eminent domain is called __________.
a. Condemnation
b. Encroachment
c. Encumbrance
d. Escheat
498) A ______ is created after a jurisdiction’s general plan is adopted. It provides more detailed information and aids in the implementation of the general plan.
a. Development plan
b. General plan
c. Specific plan
d. Zoning map
499) Jeffersontown has a zoning ordinance that requires all properties in a designated historic district to have brick or wood plank facades. No aluminum, cement board, or vinyl siding is allowed. What type of zoning is this?
a. Aesthetic zoning
b. Downzoning
c. Incentive zoning
d. Spot zoning
500) What’s one of the ways that bulk zoning achieves its objectives?
a. Through architectural style requirements
b. Through minimum height requirements
c. Through minimum parking space requirements
d. Through setbacks
501) What purpose does bulk zoning serve?
a. It homogenizes the look of the area.
b. It keeps similar races together.
c. It provides increased density.
d. It restricts building density.
502) Which of the following situations may result in inverse condemnation?
a. Property taxes rise because of an increase in property value.
b. Property values decrease because adjacent property was rezoned.
c. Property values decrease because the property was rezoned.
d. The government takes private property for public use and compensates the owner.
503) Residents of Tinytown have been complaining to town officials that the village-like character of their town is being affected by the medium-rise condos that developers are building on the edge of town. In response, local government officials rezoned the areas on the edges of town as parklands. What type of zoning is this?
a. Aesthetic zoning
b. Downzoning
c. Incentive zoning
d. Spot zoning
504) The Druid Hills neighborhood sits firmly within a single-family residential zoning area. Most of the lots are one-third of an acre or larger. A 20-acre parcel on the edge of the neighborhood sold recently. The buyer wants to build condominium flats since multi-family housing is in short supply in the area. The town is considering rezoning that parcel to allow this development because the developer plans to also include a public park and a walking trail. What kind of zoning is this?
a. Aesthetic zoning
b. Downzoning
c. Incentive zoning
d. Spot zoning
505) Your clients, the Harpers, live in Area B that’s adjacent to Area C; Area C was recently downzoned. If the Harpers believe the rezoning has harmed their property values, what can they do?
a. File a claim of inverse condemnation.
b. Move to Area C and file a claim.
c. Nothing, because they don’t live in the rezoned area.
d. They must sell to prove a loss of value.
506) Zoning that preserves the architectural style and cohesive appearance of an area is termed ______.
a. Aesthetic zoning
b. Architectural zoning
c. Bulk zoning
d. Density zoning
507) The Town of Petersville has just decided to restrict density in one area of town that previously allowed a higher density. This is known as ______.
a. Aesthetic zoning
b. Density zoning
c. Downzoning
d. Reduction zoning
508) FAR, or floor-to-area ratio, includes ______.
a. All of the habitable structures on a lot
b. All structures, including habitable structures and parking structures, but not parking lots
c. None of the habitable structures on a lot
d. The area within parking lots or parking structures
509) Which of the following statements is true about zoning classifications?
a. A property that’s zoned residential may be either single-family or multi-family.
b. A residential property may only have one use.
c. Condos are always commercial property.
d. Multi-family housing is zoned commercial.
510) What is a buffer zone?
a. A reduction in density
b. Rezoning of various spots in a city, town, or village that have similar architectural styles
c. Strips of land that are used to separate property dedicated to one use from property of another use
d. Zoning targeted to a specific demographic make-up
511) What’s the definition of a group home?
a. A facility where unrelated adults live
b. A home that’s grouped closely to other dwellings for increased density
c. An institution, such as a prison or mental health facility
d. Any multi-family dwelling
512) One area of town has maximum building height requirements and setbacks for the front, side, and rear yards. These requirements are all indicative of ______.
a. Bulk zoning
b. Commercial zoning
c. Density zoning
d. Residential zoning
513) You’re on a planning board that’s discussing how to keep the city more livable by reducing building density. The subject of bulk zoning comes up. What is your response?
a. “That applies to commercial areas only.”
b. “That’s a great way to meet our objectives.”
c. “That’s crazy. We’re trying to reduce density, not increase it.”
d. “That will work for residential areas, but what about commercial?”
514) If downzoning occurs in one area, reducing property values in adjacent areas, what can the homeowners in those adjacent areas do?
a. File a claim for inverse condemnation.
b. Require a zoning change to their own property.
c. Sell at a loss and file a claim.
d. Sue their neighbors.
515) A town has just assigned a lower-density use zone to an area that previously allowed higher density. What’s one reason the town may have done this?
a. To improve property values
b. To increase density in surrounding areas
c. To increase taxes
d. To limit overgrowth
516) The Arbor Heights community passed a zoning ordinance that requires group homes designated for disabled citizens to be situated outside of city limits. This is a violation of the ______.
a. City Charter Act
b. Fair Housing Act
c. Municipality Zoning Act
d. Zoning Disability Act
517) Which zoning classification would be used solely for the development of a home?
a. Industrial
b. Mixed use
c. Planned use
d. Residential
518) A town passes a zoning ordinance preserving the architectural style of an area and requiring plantings in the parking strips. This is an example of ______.
a. Aesthetic zoning
b. Architectural zoning
c. Bulk zoning
d. Variance zoning
519) Which type of zoning classification is used for areas that are undeveloped or are used to raise animals or plants?
a. Agricultural
b. Commercial
c. Industrial
d. Residential
520) Cluster zoning would include single-family homes, townhomes, apartments, and condominiums on a single parcel, provided that the developer leaves a portion ________.
a. Of each building for a community room
b. Of the parcel for parking
c. Of the parking lot for RV parking
d. Open for a playground, a park, and a walking path
521) Tres owns a warehouse in an area that is zoned light industrial. With an increased demand for housing in the area, Tres wants to create loft-style condos and have his property designated as residential, even though the surrounding buildings will remain light industrial. What type of zoning is this?
a. Aesthetic zoning
b. Downzoning
c. Incentive zoning
d. Spot zoning
522) A new development is going up just outside city limits where the population is expected to grow significantly in the next decade. The development will consist of commercial properties in one quadrant near a main road. The other areas are designated residential and will include single-family residences and multi-family townhomes. A small number of the single-family homes will border a golf course that is at the center of the development. What type of zoning is this an example of?
a. Conforming
b. Exclusive-use
c. Non-conforming
d. Planned unit development
523) Which of the following is a type of zoning action?
a. Aesthetic
b. Bulk
c. Moratorium
d. Rural
524) Which of the following actions likely requires a variance?
a. A change in architectural style
b. A garage repair
c. An addition which alters the setback
d. A remodel involving a different internal layout
525) Which of the following must occur before zoning changes are made?
a. Local development experts must be consulted.
b. Public hearings must be held.
c. The real estate commission must approve the changes.
d. Voters in that jurisdiction must vote to approve the change.
526) Which of the following is true about zoning?
a. Proposed zoning ordinances are examined for fairness before being enacted.
b. While zoning may impact a community, it does not impact individual property owners.
c. Zoning changes are enacted by local governments without public input.
d. Zoning does not impact property value.
527) Which of the following is a common action of historic preservation commissions?
a. Adopting ordinances to protect the historical character of the area
b. Buying any properties that are listed for sale in the area
c. Demolishing properties in the area
d. Prohibit construction or renovations of any kind
528) Which of the following statements about zoning ordinances is true?
a. Before zoning ordinances are changed, they must be examined for fairness and reasonableness.
b. Zoning ordinance changes apply to specific properties in different ways.
c. Zoning ordinance changes impact communities, but not individual property owners.
d. Zoning ordinance changes impact individual property owners, but not communities.
529) April was able to establish a day care in a residential neighborhood, where the zoning wouldn’t normally be permitted. This required permission from the planning commission and ______.
a. A special use permit
b. A tax referendum
c. A variance
d. A zoning ordinance
530) Back in the 1930s, the house at 102 Barbour Street was the only one in sight. Since then, however, the town has grown considerably and the once-residential Barbour Street is an industrial zone, with the residence at 102 Barbour Street in the middle of it all. What type of zoning does the residence demonstrate?
a. Conforming zoning
b. Non-conforming zoning
c. Planned unit development
d. Spot zoning
531) Your client, William, wants to run a tax office out of his home. He lives in an area that is not zoned for that purpose. What must William obtain to operate his tax office legally?
a. A home business waiver
b. A petition from his neighbors
c. A special use permit
d. A variance
532) The purpose of ______ commissions is to preserve buildings, landmarks, and the character of certain areas.
a. Historic preservation
b. Human rights
c. State real estate
d. Wetlands
533) What’s the difference between a special use permit and a variance?
a. A special use permit allows a deviation from the requirements of the zoning ordinance; a special use permit is the temporary use of another’s property.
b. A variance allows a deviation from the requirements of the zoning ordinance; a special use permit allows a use not ordinarily allowed in the zone.
c. A variance is temporary; a special use permit is permanent.
d. A variance relates to building height only; a special use permit can relate to building height, use, or setback.
534) The developer of a new subdivision is placing residential properties closer together, allowing him to include large open spaces throughout the development to build bike and walking trails, as well as a community pool and recreation center. What type of zoning is this?
a. Cluster
b. Conforming
c. Non-conforming
d. Spot
535) Which of the following is true about a variance?
a. It involves eminent domain.
b. It’s a use that was in place when the zoning ordinance was enacted.
c. It’s temporary.
d. To obtain it, the owner must show hardship.
536) What describes both the type of the development and the regulatory process that allows the developer to meet the community’s goals for land use and density without being restricted by existing zoning requirements?
a. Cumulative zoning
b. Planned unit development
c. Spot zoning
d. Subdivision
537) Which of the following is the sunshine law based on?
a. The First Amendment
b. The Freedom of Information Act
c. The Sarbanes-Oxley Act
d. The SPEECH Act
538) Builders weren’t allowed to develop new properties in Cityville for six months. This is likely because the city had enacted a ______.
a. Condemnation
b. Moratorium
c. New tax base
d. Zoning ordinance
539) When would a sheriff’s deed be used?
a. Property owned free and clear by the owner(s)
b. Property that is being passed down in probate
c. The court-ordered sale of a property
d. To clear interest in property from the title
540) Which term describes an oath by a subscribing witness, such as a notary public, that the grantor’s signing of the deed is a voluntary act and enables a deed to be recorded?
a. Acknowledgment
b. Grantee
c. Granting clause
d. Habendum clause
541) Siblings Shasta and Ruby inherited their mother’s home when she died. Ruby had been taking care of their mom, so she was already living in the home and continued to do so. Shasta lived in another state and remained there. After some years, Ruby decided to sell the house. Shasta agreed to the sale, and even offered to give up any of his ownership so Ruby could enjoy all the profits of the sale. What’s the best deed to use in this situation?
a. Executor’s deed
b. Quitclaim deed
c. Trustee’s deed
d. Warranty deed
542) Which of the following is an instrument of conveyance?
a. Deed
b. Mortgage
c. Promissory note
d. Title insurance policy
543) Joe Bob is the grantor of a deed, and is in the final stages of transferring a deed to the new owner, Frank. What must Joe Bob do in order to satisfy delivery and acceptance of the deed to Frank?
a. Deliver the deed to Frank, his agent or attorney, or the title company issuing the title
b. Get Frank’s signature on the official acceptance letter notarized and recorded at the county clerk’s office.
c. Send the deed via certified mail so that the shipment is officially tracked
d. Submit delivery and acceptance paperwork to the Board of Submission and Acceptance
544) Select the statement that accurately reflects the type of deed used for the transfer.
a. A bargain and sale deed conveys property in a foreclosure proceeding.
b. A deed of trust conveys real estate to a trustee for the beneficiary named in the deed.
c. A referee’s deed conveys property from one spouse to another in a divorce proceeding.
d. A warranty deed conveys REO property from the lender.
545) Which kind of deed releases any rights of the grantor to the property to the grantee and clears any clouds on a title, but does not offer any warranties to the grantee?
a. Executor’s deed
b. Grant deed
c. Quitclaim deed
d. Sheriff’s deed
546) What type of deed are you likely to receive if you purchase a California property with cash at a foreclosure auction?
a. Bargain and sale deed
b. Executor’s deed
c. Full covenant and warranty deed
d. Trustee’s deed upon sale
547) Which one of the following covenant terms promises that the grantor will provide any additional assurances that the grantee reasonably requires and perform any acts necessary to correct any defect in the title being conveyed?
a. Against encumbrance
b. Further assurances
c. Quiet enjoyment
d. Warranty
548) Select the statement that correctly exemplifies the covenant term.
a. The covenant against encumbrances is the grantor’s guarantee that he or she owns the property being conveyed.
b. The covenant for further assurances assures the grantee that there are no undisclosed encumbrances on the property.
c. The covenant of quiet enjoyment promises that the grantee won’t be disturbed by a title defect the grantor passes on.
d. The covenant of warranty promises that the grantor has the capacity to convey title.
549) A ______ is a method of conveying real property from one party to another.
a. Deed
b. Power of attorney
c. Promissory note
d. Recordation
550) Jerry’s client Carla has successfully closed on the purchase of a home. The deed shows she’s taken sole ownership of the property. Which of these actions is necessary before the escrow agent can have the deed recorded?
a. Carla must name a beneficiary.
b. Carla must state her acceptance of the deed.
c. The grantor’s signature must be acknowledged.
d. The title company must issue a standard policy that validates the deed.
551) Which type of deed comes with two covenants of warranty implied in its use?
a. Grant deed
b. Quitclaim deed
c. Sheriff’s deed
d. Warranty deed
552) Which covenant term means that the grantor both has legal capacity to convey the title and also has the title to convey?
a. Further assurances
b. Quiet enjoyment
c. Right to convey
d. Warranty forever
553) Which type of deed conveys real property from a decedent’s estate to a buyer?
a. Deed in trust
b. Executor’s deed
c. Quitclaim deed
d. Referee’s deed
554) John and Michelle received a general warranty deed when they purchased their house from Ted. A couple of months after they moved in, their neighbor, Bryant, drove his four-wheeler across their property to access the lake front. John discovered that Ted and Bryant agreed to an easement over Ted’s property several years earlier. Which general warranty deed covenant does this represent?
a. The covenant against encumbrances
b. The covenant of further assurances
c. The covenant of quiet enjoyment
d. The covenant of seisin
555) Kevin and Regina sold their property to Vickey using a general warranty deed. Which one of these statements is true?
a. Either Regina or Kevin can convey the property.
b. Kevin and Regina are the grantees.
c. Vickey is the grantee.
d. Vickey is the grantor.
556) A property owner who wishes to convey property to a new owner will generally use a ______.
a. Deed
b. Lease
c. Mortgage
d. Title abstract
557) Ari owned acreage in a rural area. He sold a small portion of it to a neighbor in an informal transaction but made no record of the sale or change of ownership. A developer offered Ari several million dollars for the entire acreage, and Ari eagerly accepted the offer. What covenant is Ari in danger of violating?
a. Against encumbrances
b. Quiet enjoyment
c. Seisin
d. Warranty
558) Meg is considering a move to a foreign country and wants to deed her property to her son, Christian, who’s 16. Which of these must occur to make this transfer legal?
a. Christian must agree to the transfer and sign the deed.
b. Christian must provide monetary compensation to Meg.
c. Meg must sign the deed and have her signature acknowledged.
d. Meg must wait until Christian has reached the age of majority.
559) Which term refers to the person conveying title, often called the “party of the first part,” in a deed?
a. Grantee
b. Grantor
c. Notary public
d. Witness
560) Todd conveyed title to his out-of-state property to Brad using a general warranty deed. A few months later, Brad discovered that the legal description of the property on the deed was incorrect, and his property was only half the size he thought he’d purchased. He sued Todd based on Todd’s promises of ______ in the deed.
a. Consideration and compensation
b. Habendum and fair dealing
c. Quiet enjoyment and further assurances
d. Seisin and right to convey
561) What phrase is or words are required on a deed and are considered an “act of conveyance?”
a. “Between ____ and ____.”
b. “Forever and always”
c. “Grant and convey”
d. “Witnesseth and acknowledged”
562) Colleen and Judy purchased a dilapidated townhome in an estate sale. Due to their fix-up work and the current economy, the property value has skyrocketed. They decide to sell it to get their equity out of it. After they list it, a woman comes forward, saying she is an heir to the previous owner and lays claim to the property. Which general warranty deed covenant protects Colleen and Judy?
a. The covenant against encumbrances
b. The covenant of seisin
c. The covenant of the right to convey
d. The covenant of warranty
563) Which of the following terms describes the actions required to transfer a title by deed?
a. Acknowledgment
b. Delivery and acceptance
c. Granting clause
d. Habendum
564) In order to convey real property, which one of the following documents would you use?
a. Deed
b. Mortgage
c. Promissory note
d. Title insurance
565) Which term refers to the person receiving title, often called the “party of the second part,” in a deed?
a. Grantee
b. Grantor
c. Notary public
d. Witness
566) Cheng is selling his property to Jericho. What’s the best method Jericho can use to ensure his interest in the property?
a. Ensure that Cheng signs the deed.
b. Ensure that he signs the deed.
c. Purchase title insurance.
d. Record the deed in his name.
567) Which type of deed is sometimes called a general warranty deed and contains all six covenants?
a. Bargain and sale deed
b. Quitclaim deed
c. Referee’s deed
d. Warranty deed
568) Which of the following could be a valid deed?
a. A napkin with both parties’ signatures and an oral agreement to sell the land
b. An oral agreement between two trusted individuals
c. An oral agreement between two trusted individuals and witnesses
d. A written document containing all of the required elements and adhering to all document formatting requirements
569) Which address(es) must be included on the deed?
a. The grantee’s
b. The grantor’s and the county clerk’s
c. The notary public’s and the county clerk’s
d. The notary public’s and the grantee’s
570) When you’re working with clients in California, how will you explain the grant deed to them?
a. It includes implied warranties from the grantor, and is commonly used in California.
b. It includes six express covenants from the grantor, but is rarely used in California.
c. It’s used in transactions where no consideration or consideration of “love and affection” is given in exchange for the property.
d. It’s used to convey title when the property is used as security for a loan.
571) Which option must be included on a deed for it to be valid?
a. County judge’s and sheriff’s signatures and approval
b. List of all living neighboring property owners
c. Name of next of kin for inheritance purposes
d. Names of grantor/grantee
572) Kandy was so excited to be buying her first home, a condo in a San Diego beach neighborhood. Thanks to an inheritance, she was able to pay for the property in cash! She gazed adoringly at her deed, admiring each of its elements that proclaimed her the sole owner of 1256 Voltaire Street, Unit 15. Which of these is NOT on Kandy’s deed?
a. A granting clause
b. Kandy’s signature
c. Names of the grantor and the grantee
d. The property description
573) What term is defined as the addition of value to property through labor or the addition of new materials?
a. Accession
b. Accretion
c. Alluvion
d. Avulsion
574) Jerome has four grown children. When he dies, he leaves his home to all four children, making them tenants in common with equal shares. One child wants to live in the house, another wants to use it as investment property, and two others want to sell it and take the cash. When they can’t agree on a solution, they end up in court and the property is ______.
a. Deeded by appointment
b. Foreclosed
c. Partitioned
d. Transferred via intestate succession
575) Which term is defined as someone claiming property of another simply by using it for an extended period of time?
a. Accession
b. Adverse possession
c. Dedication by deed
d. Public grant
576) What takes precedence over a deceased person’s wishes to grant his property at death, even if those wishes are specified in the decedent’s will?
a. Intestate succession
b. Location, location, location
c. Operation of law
d. Public interest
577) When co-owners of a property decide to partition the property, what does it mean?
a. One co-owner is foreclosing on another.
b. They’re dividing the property into parcels and maintaining co-ownership of each parcel proportionally.
c. They’re dividing the property proportionally so that each co-owner becomes sole owner of a portion.
d. They’re selling additional interests in the property, in essence adding co-owners.
578) Trinity has been named executor of her uncle’s will. What does this mean?
a. She receives all her uncle’s possessions and property.
b. She’s responsible for carrying out the will’s provisions.
c. She’s responsible for taking care of her uncle until his death.
d. She’s responsible for the probate of her uncle’s will.
579) Which term is defined as land that washes away and decreases the property size?
a. Accession
b. Accretion
c. Alluvion
d. Avulsion
580) Who would inherit the property in a family with legally adopted children if both parents died without a will?
a. The illegitimate children
b. The IRS
c. The legally adopted children
d. The state
581) Which term is used to describe when an owner gives or donates land or an easement for public use?
a. Accession
b. Adverse possession
c. Dedication by deed
d. Public grant
582) Which term is defined as an increase in land by the permanent and gradual withdrawal of water?
a. Alluvion
b. Avulsion
c. Dedication
d. Reliction
583) Frank had been talking about getting a will for a while now, but he never got around to it before he passed away unexpectedly. His wife and two kids were very distraught and the family got together with his only living relative, a cousin, and friends at the funeral for the first time in years. Frank’s wife is now concerned about who will get the farm where she and her children live. According to the laws of intestacy, can you figure out who will get the land?
a. The children
b. The closest living relative, Frank’s cousin.
c. The state
d. The wife
584) Susan Duffield died testate at age 49. What can be said about Susan’s estate?
a. Because of Susan’s age, any will is invalid.
b. Because of the will, it will avoid probate.
c. Because she died without a will, the estate becomes property of the state.
d. It will be put through probate.
585) Marsten is the personal representative for his grandmother’s estate. After her death, he learns that he can’t distribute the estate’s property until after the will goes through probate. What does this mean?
a. Marsten must apply through the courts to manage his grandmother’s estate.
b. The court must determine the will’s validity and supervise distribution of the estate.
c. The courts must contact all potential heirs to learn of their wishes regarding distribution of the estate.
d. The courts must review Marsten’s ability and knowledge related to distribution of the estate.
586) Which term is defined as the act of transferring away ownership of a property?
a. Alienation
b. Avulsion
c. Real transference
d. Reliction
587) Which term describes the newly formed land mass built up by the deposits of sediments on a property that belongs to the owner?
a. Alluvion
b. Avulsion
c. Erosion
d. Reliction
588) What might Trina’s mother have bequeathed to Trina?
a. Her interest in an oil drilling operation
b. Her jewelry and fine china
c. Her primary residence
d. Her vacation property
589) According to the laws of descent, who will inherit the property when there are no surviving heirs?
a. Friends of the family
b. Private auction
c. The neighboring property owner
d. The state
590) Which term is defined as the build-up of land near water from the accumulation of sand, silt, or gravel deposits?
a. Accession
b. Accretion
c. Accumulon
d. Avulsion
591) What is it called when property is taken by the state after the owner dies without heirs?
a. Accession
b. Escheat
c. Estoppel
d. Forfeiture
592) If a property owner dies intestate and no heirs or creditors can be found, what becomes of the property?
a. A lottery is held for ownership.
b. The property is combined with an adjoining property.
c. The property reverts to a former owner as recorded on the deed.
d. The state claims the property through escheat.
593) June specified in her will how title to her home would transfer. At her death, alternate conveyance occurred. What likely happened?
a. Fraud
b. Intestate hereditary
c. Operation of law
d. Testate succession
594) What do you have to prove in order to claim a piece of property through adverse possession?
a. Have a public grant land patent document
b. Must be dedicated to you by the true owner
c. Possession must be open, notorious, continuous, and uninterrupted without permission of the true owner
d. Prove the land was acquired through the accumulation of sediments
595) Which term is defined as the state government granting power, license, or real property to a private individual or individuals using a land patent?
a. Accession
b. Adverse possession
c. Dedication by deed
d. Public grant
596) Roberta worked with an attorney to prepare her will. What kind of will is this?
a. Descent
b. Functional
c. Holographic
d. Statutory
597) The terms of a person’s will are subject to ______.
a. Intestate succession
b. Legal duress
c. Nothing
d. Operation of law
598) Jardin passed away suddenly, and when his family started looking through his documents, they found a handwritten will. Which of these statements about the will is true?
a. A handwritten will, also called a holographic will, may be valid if it meets other terms for validity.
b. A handwritten will, also called a statutory will, is valid if it’s been witnessed.
c. A handwritten will is called a simple will.
d. A handwritten will is not valid.
599) What is it called when a property owner acquires additional land through manmade or natural causes?
a. Accession
b. Alienation
c. Dedication
d. Reliction
600) Your aunt bequeathed you her property in her will, but you never received it. Instead, the property went to pay her tax bill. Is this legal?
a. No, never
b. Not if there were other heirs
c. Yes, due to operation of law
d. Yes, if the will wasn’t witnessed
601) Shana received a devise from her mother. What might this be?
a. A written message
b. Her mother’s car
c. Her mother’s farm
d. Her mother’s jewelry
602) Elmer died and left a will. Before his estate can be distributed according to his wishes, it must go through ______.
a. A lawyer
b. Devise
c. Escheat
d. Probate
603) Meredith died, leaving behind a will. Although her instructions to devise her property to her daughter were explicit, her husband inherited. Why might this be?
a. Escheat
b. Intestate
c. Testate
d. The operation of law
604) Wilma died without a will. How will her heirs be determined?
a. A committee appointed by the court
b. Intestate bequest
c. Intestate succession
d. The process of escheat
605) ______ determines who the heir or heirs will be if a person dies without a will.
a. Court appointment
b. Escheat
c. Intestate bequest
d. Intestate succession
606) When tenants in common can’t agree on how to manage the property and want to terminate their co-ownership without selling the property, how can this be accomplished?
a. Foreclosure
b. Law of succession
c. Partition
d. Process of escheat
607) In a contract, consideration is the giving of ______.
a. Notice to attorneys that they may review the terms of the agreement
b. Something of value in exchange for something of value
c. Something of value in exchange for something without value
d. Thoughtfulness and courtesy to all parties
608) Which of the following best explains how the statute of frauds protects consumers?
a. It doesn’t allow people to own land unless they can afford it.
b. It provides requirements that certain contracts have to meet to be legally enforceable.
c. It puts a limit on how much interest financial institutions can charge.
d. It states that all real property sales must involve lawyers.
609) Ken signed a contract to purchase Debra’s condo. Ken signed the contract two weeks prior to turning 18, which is the age of majority in his state. Debra found out about his age prior to the closing but honored the contract, and they closed on the condo a month after Ken’s birthday. What was the status of the contract when Ken and Debra entered into it?
a. Executed
b. Illegal
c. Void
d. Voidable
610) A legally competent party means that an individual has the capacity, legally and ______, to enter into a contract.
a. Financially
b. Mentally
c. Morally
d. Purposefully
611) Louellen is about to take out a mortgage loan from her credit union. The contract includes the following information: Louellen is offering her house as consideration, and the credit union is offering $350,000; and Louellen will pay the loan back over a certain number of months at a certain rate. Both Louellen’s signature and the credit union representative signed it. What, if anything, is this contract missing in order for it to be legally binding, according to the statute of frauds?
a. Louellen’s credit history needs to be included.
b. Nothing is missing.
c. The condition and size of the house needs to be included.
d. The credit union’s physical address needs to be included.
612) In contract law, a “legally competent” party has the ______ to enter into a contract.
a. Financial resources
b. Legal and mental capacity
c. Legal background
d. Motivation and means
613) Bill and Mindy, who are neighbors, get into a disagreement about late-night noise. The two come to an agreement: Bill promises to stop having loud parties and Mindy promises to keep her dogs inside after 10 p.m. Their promises represent the ______ in their agreement.
a. Consideration
b. Flaw
c. Legal competency
d. Undue influence
614) A real estate contract written for an illegal purpose is ______.
a. Permissible and valid
b. Void
c. Voidable only by the buyer
d. Voidable only by the seller
615) Which of the following elements is always required for a real estate contract to be valid?
a. Attorney review
b. Consideration
c. Earnest money
d. Profit
616) Which of the following is true about the statute of frauds?
a. All types of written contracts, with the exception of email or other online communication, may be considered “in writing” and binding.
b. Any form of written contract, including email communication, may be considered “in writing” and binding.
c. Only contracts that are handwritten are considered to be “in writing” and binding.
d. Only pre-printed contracts, the blanks of which have been filled in in ink, are considered to be “in writing” and binding.
617) What’s the best definition of legal purpose?
a. Attorney consideration
b. Mentally capable of entering into a contract
c. Written for a lawful objective
d. Written for an illegal purpose
618) Robert and Sarah enter into a contract for Sarah to purchase Robert’s home. Robert decides he doesn’t want to sell, and is elated when he finds out that Sarah’s only 17 years old. Can Sarah force Robert to sell?
a. No, because Sarah can’t legally enter into a contract.
b. No, she can purchase the house if Robert doesn’t object, but can’t do so if he objects.
c. Yes, as long as she gets a legally competent party to co-sign the contract with her.
d. Yes, Sarah can require that Robert fulfill the contract terms.
619) The statute of frauds states that if a contract transferring ownership of real property is not in writing, it’s ______.
a. Enforceable
b. Executory
c. Unenforceable
d. Voidable
620) What does the parol evidence rule say about contracts?
a. All contracts, commitments, and agreements for the sale of real property must be in writing.
b. A sales contract must contain the essential elements of a contract for it to be enforceable.
c. In order for a real estate agreement to be enforceable, it must be in writing and signed by both parties.
d. The terms agreed to in a written contract are the only terms relating to that contract.
621) According to the statute of frauds, which of the following agreements needs to be in writing to be legally enforceable?
a. Condo owner Freya agreed to let her friend’s daughter stay in her spare room for four months.
b. Geoffrey agreed to work on his uncle’s farm for a few days to pay off the $300 he owes him.
c. Lara sold her book collection to her friend for $450.
d. Pam agreed to rent her house to Miguel for three years.
622) Per the statute of frauds, which of the following agreements does NOT have to be written down in order to be legally binding?
a. Sierra sells her car to her cousin for $2,500.
b. Sloane agrees to pay the $400 in credit card debt that her sister owes.
c. The Lees rent out their basement to some college students for three months.
d. Tyrone and Alaya are getting married.
623) Which of these statements about alien residents and non-residents of California is true?
a. Federal law grants equal property ownership rights to resident and non-resident aliens as citizens in California.
b. Resident aliens may legally own property if their alien status is unknown.
c. Resident aliens may own property, but non-resident aliens may not.
d. Resident and non-resident aliens have the same property ownership rights as citizens in California.
624) Tom and Jim are neighbors. Jim wants to buy Tom’s rental property. In the contract they sign, Jim is identified only as “the neighbor.” Which statute or contract element does this violate?
a. Fair housing
b. Legal purpose
c. Offer and acceptance
d. The statute of frauds
625) Drew and Hank were camping at Hank’s riverfront cabin. Hank told Drew that he rarely used the cabin and was thinking of selling it. Drew said that he’d buy it from Hank for $80,000, which Hank agreed was a fair price. It’s two months later, and Hank is upset that Drew now says he won’t buy it. Why isn’t this contract enforceable?
a. Drew didn’t have the financial resources to make the offer.
b. Real estate contracts must be in writing.
c. There was no offer and acceptance.
d. This wasn’t a legal purpose.
626) Jolene signs a contract to buy Harvey’s home. Before closing, it’s discovered that Jolene is only 16 years old. Because she’s a minor, she’s not considered legally competent to enter into a contract. Which of the parties can void the contract?
a. Harvey
b. Jolene
c. Nobody
d. Only a judge
627) Which of these groups of people are considered legally able to enter into a contract in California?
a. Convicts, incompetents, corporations
b. Emancipated minors, aliens, LLCs
c. Minors, aliens, convicts
d. Minors, aliens, LLCs
628) The residents of Blair Avenue are a close-knit bunch. They’re all young couples with small children, and they don’t want this dynamic to change when two of the couples have to move. Those couples sign an agreement promising not to sell to anyone without kids or to anyone over the age of 50. The contract can’t be enforced because it’s missing ______.
a. Consideration
b. Legally competent parties
c. Legal purpose
d. Offer and acceptance
629) A valid contract must include which of the following elements?
a. Counter-offer
b. Electronic signature
c. Fairness clause
d. Legally competent parties
630) If a party to a contract lacks legal capacity but enters into a contract anyway, which party may void the contract?
a. Both parties
b. The broker
c. The party lacking legal capacity
d. The party possessing legal capacity
631) In a real estate transaction, which of the following is established when the parties enter into an agreement voluntarily with a full understanding of the contract terms?
a. Consent
b. Consideration
c. Legal competency
d. Legal purpose
632) Both the buyer and the seller have to sign the purchase and sale agreement in order to demonstrate that ______.
a. An attorney has reviewed the contract
b. Their agents have agreed to the terms and conditions
c. The very first offer was accepted
d. They understand the terms
633) An ______ minor is considered to be a legally competent party who is able to enter a contract.
a. Alien
b. Emaciated
c. Emancipated
d. Incompetent
634) When offer and acceptance has occurred, both parties enter into ______.
a. A contingency
b. A mutual agreement
c. Consideration
d. Understanding
635) A contract for an illegal purpose is ______.
a. Fraud
b. Valid
c. Void
d. Voidable
636) To meet the requirements of the statute of frauds, an agreement must clearly identify the contract’s subject matter, present the contract’s essential terms and conditions, and ______ to be enforceable.
a. Achieve a result that’s fair to all parties
b. Be agreed to verbally
c. Be reviewed by an attorney
d. Identify the contracting parties
637) Bobby has just found out that he was named as the executor of his grandfather’s will. In accordance with the terms of the contract, he may sell his grandfather’s property while serving as a ______.
a. Lawyer
b. Partner
c. Personal representative
d. Seller representative
638) Claudia and Yves enter into contract for her to buy his condo. The written contract must _____, identify the subject matter of the contract, and present the essential terms and conditions of the contract.
a. Achieve a result that is fair to all parties
b. Be handwritten
c. Be signed by two or more attorneys
d. Name the contracting parties
639) Carl and Sadie, who are neighbors, got into a disagreement about early-morning noise on the weekends. The two came to an agreement: Carl promised to not mow the lawn before 10 a.m., and Sadie promised to put bark collars on her dogs in the early morning hours. Their promises represent the ______ in their agreement.
a. Consideration
b. Flaw
c. Legal competency
d. Undue influence
640) In the eyes of the law, why do people under age 18 lack contractual ability?
a. They have insufficient resources.
b. They lack intelligence.
c. They’re immature.
d. They’re minors.
641) Another term used to describe an executor or executrix who was named to carry out the provisions of a will is a personal ______.
a. Assistant
b. Executor
c. Lawyer
d. Representative
642) What does the parol evidence rule state?
a. All contracts, commitments, and agreements for the sale of real property must be in writing.
b. An Agreement of Sale must contain the essential elements of a contract for it to be enforceable.
c. For a real estate agreement to be enforceable, it must be in writing and signed by both parties.
d. In most cases, a written agreement is the final and comprehensive expression of the parties’ agreement. It generally prohibits introducing oral or written evidence that contradicts that agreement.
643) Sylvia, who’s 15 years old, and her neighbor Marge, who’s 24, sign an agreement that Sylvia will babysit Marge’s toddler for the summer for $10 an hour. What type of contract is this?
a. Enforceable
b. Unilateral
c. Valid
d. Voidable
644) Jessica enters into a contract to acquire real property in return for some form of consideration. On the contract, Jessica is regarded as the ______.
a. Agent
b. Broker
c. Buyer
d. Seller
645) Doris and Kathleen, who are neighbors, enter into an agreement to not permit their real estate agents to sell their homes to families with children. This agreement lacks ______, so it’s void.
a. A lawful objective
b. A mutual agreement
c. A purpose
d. Two parties
646) Which of these is an example of good consideration?
a. A payment of less than $10,000
b. A payment of more than $10,000
c. Earnest money paid with a cashier’s check or wire transfer
d. Gifting a house to a family member
647) Which of the following states that, in certain cases, oral evidence can be used to support or complete an otherwise incomplete or ambiguous contract?
a. The parol evidence rule
b. The statute of frauds
c. The statute of limitations
d. The statute of oral evidence
648) Alex, a high school freshman, started a neighborhood lawn care business. Simone decides to hire Alex to mow her lawn every two weeks. Alex presents Simone with a written contract outlining the services to be provided and the fee Simone will pay. Which of the following is true in this situation?
a. Because minors can’t enter into a contract, this contract is void.
b. Because this contract binds Alex and Simone to an obligation that’s legal for a minor to perform (mowing lawns), the contract is valid and enforceable for both parties.
c. If both parties are content to uphold their agreement, the fact that it’s not legally binding doesn’t matter.
d. Minors can’t enter into contracts, so Alex’s parents are legally obligated to uphold the contractual obligations if Alex fails to fulfill them.
649) Which of these statements about alien residents and non-residents of California is true?
a. Federal law grants equal property ownership rights to resident and non-resident aliens as citizens in California.
b. Resident aliens may legally own property if their alien status is unknown.
c. Resident aliens may own property, but non-resident aliens may not.
d. Resident and non-resident aliens have the same property ownership rights as citizens in California.
650) An ______ minor is considered to be a legally competent party who is able to enter a contract.
a. Alien
b. Emaciated
c. Emancipated
d. Incompetent
651) Only one of these lists of people includes parties who are all legally capable of contracting in California. Which is it?
a. Aliens, minors, incompetents, convicts
b. Convicts, emancipated minors, aliens, incompetents
c. Convicts, emancipated minors, incompetents
d. Corporations, nonprofit associations, LLCs, individual proprietors
652) Jessica enters into a contract to acquire real property in return for some form of consideration. On the contract, Jessica is regarded as the ______.
a. Agent
b. Broker
c. Buyer
d. Seller
653) All of the following are true regarding implied agreements EXCEPT which one?
a. An implied agreement is based on actions or behaviors.
b. An implied agreement is based on a formal agreement.
c. With an implied agreement, it’s possible that the other party didn’t intend to be bound.
d. With an implied agreement, there’s an increased chance of confusion.
654) Real estate sales contracts must be valid, express, bilateral, ______, and executed or executory.
a. Enforceable
b. Oral
c. Unenforceable
d. Voidable
655) You sign a contract to purchase a machine that will allow you to travel back in time and meet Abraham Lincoln. Assuming that time machines don’t actually exist (for now), what type of contract is this?
a. Enforceable
b. Unilateral
c. Void
d. Voidable
656) Your automatic check writer wrote a check for $51.50, but your printer ran out of toner, so you had to fill in the handwritten line. In a hurry, you accidentally wrote, “Fifty-one dollars and no/100 cents.” Which amount takes priority?
a. Neither; the check is void
b. The handwritten number
c. The numerals
d. The recipient must split the difference between the two amounts
657) Which of the following is a contract that exists based on an understanding or assumption, rather than on specifically defined terms?
a. Express contract
b. Implied contract
c. Invalid contract
d. Unilateral contract
658) Which of these sentences accurately lists rules for interpreting a contract?
a. Pre-printed text takes precedence over typed and handwritten text.
b. Typed text takes precedence over handwritten text.
c. Typed text takes precedence over pre-printed text, and numbers (e.g. 2) take precedence over spelled-out numbers (e.g. three).
d. Typed text takes precedence over pre-printed text, and spelled-out numbers (e.g. four) take precedence over numerals (e.g. 5).
659) Which of the following is a primary focus of the statute of frauds as it relates to real estate transactions?
a. Anyone caught committing real estate fraud will be prosecuted.
b. Fraudulent behavior won’t be tolerated in the real estate profession.
c. Real estate purchase and sale contracts must be in writing to be enforceable.
d. There’s a limitation on how long someone can sue for fraud.
660) You receive an offer in the mail that says you’re eligible to win a cash prize if you place some stickers on a form and return it to the sender. What type of contract is this?
a. Implied contract
b. Invalid contract
c. Unenforceable contract
d. Unilateral contract
661) Which of the following is true regarding express agreements?
a. Express agreements are implied.
b. Express agreements are invalid.
c. Express agreements may be written or verbal.
d. Express agreements must be lengthy.
662) Alex and Michael Helbig signed a contract to purchase their first home from sellers Joe and Bonnie Watson. Once closing occurred and all closing requirements wrapped up, the Helbigs were given the keys to their house. What type of contract do they have at this point ?
a. Executed
b. Executory
c. Implied
d. Voidable
663) You’re talking to a co-worker at lunch, and she mentions she has a box of baby clothes her kids have outgrown that she needs to get rid of. You have a baby on the way, so you offer to pay her $25, and she agrees to bring the box to work the next day and give it to you. Which of the following is true in this situation?
a. This is an express contract because you defined in words the specific terms of the agreement and consideration to be exchanged.
b. This is an implied contract because it is not written down and nobody signed anything.
c. This is an invalid contract because it is not written down and nobody signed anything.
d. This is a unilateral contract because only one party is providing anything of value.
664) Why do you think that handwritten changes take priority over typed changes?
a. All typewriters are different.
b. It’s less likely to be done inadvertently.
c. They are made last.
d. Typed changes are the same as pre-printed changes.
665) In which of the following types of contracts does one or more of the contract’s terms still need to be completed?
a. Bilateral contract
b. Executed contract
c. Executory contract
d. Unilateral contract
666) Three of these statements about interpreting contracts are true, and one is not. Which statement is FALSE?
a. A handwritten insertion can be canceled out by typing over it.
b. Handwritten insertions take precedence over typed and pre-printed insertions.
c. If a contract shows a fee as $250 in one location and “three hundred fifty” in another, the amount of 350 will be assumed to be correct.
d. If typed text is crossed out and replaced with a handwritten note, the handwritten note is what should be executed.
667) What is wrong with this statement: “Handwritten information on a contract is not legally binding. All insertions must be typed.”?
a. Contracts are not legally binding.
b. Insertions are not allowed on contracts. They must be pre-printed.
c. Insertions do not have to be typed to be legally binding.
d. There is no reason to write by hand on a contract.
668) Rex needs to handle some money he acquired during an “unsavory” business deal. He agrees to sign his boat over to his colleague, Ben, if Ben can launder the money and return it to Rex as part of a legal business deal. What kind of contract do Rex and Ben have?
a. Executed
b. Executory
c. Void
d. Voidable
669) Which type of contract is the opposite of an express contract?
a. Bilateral
b. Executory
c. Implied
d. Voidable
670) In a purchase offer, is earnest money required in order to have a binding contract?
a. No, because earnest money isn’t part of a sales contract.
b. No, because the buyer’s consideration is the promise to buy.
c. Yes, because it opens escrow.
d. Yes, because it’s the buyer’s consideration.
671) Which of these situations represents a unilateral contract?
a. Cain sells Trenton his bike.
b. Maurice promises Shelton $100 if Shelton will sell his painting. Shelton agrees, but Maurice doesn’t pay Shelton.
c. Nathan and Sue exchange vows at their wedding.
d. Sherry promises to give Brent a ride home from work, and then doesn’t show up.
672) Which of the following best describes a bilateral contract?
a. A contract for which one or more terms has yet to be completed
b. A contract in which only one of the parties offers consideration
c. A contract that involves an exchange of consideration between two parties
d. A contract that is enforceable by law
673) Which of the following describes a contract that exists based not on words, but on the parties’ actions or behaviors?
a. Executed
b. Executory
c. Express
d. Implied
674) In an addendum to the purchase and sale contract, the seller agrees to paint the house before conveying the house to the buyer. The weather changes, and the seller is unable to finish painting the house before closing. Of what is this an example?
a. A void contract
b. Contract execution
c. Legal purpose
d. Partial performance
675) Kyle promised his grandmother he’d pay her $200 a month to live in the room above her garage. He lived there a few months without paying a dime and then disappeared one night after trashing the place. How long does Grandma have to decide if she can really bring herself to sue Kyle?
a. Six months
b. Two decades
c. Two months
d. Two years
676) Kenneth entered into a contract to sell his home to Valerie, who put down a $5,000 earnest money deposit. At the last minute, Valerie backed out of the deal, and Kenneth kept the earnest deposit. This is an example of ______.
a. Accepting liquidated damages
b. Accepting partial performance
c. Suing for damages
d. Suing for specific performance
677) When a contract has been breached, the wronged party may attempt to sue for punitive damages, which are ______.
a. An agreed-upon amount that the buyer will pay the seller if the buyer breaches the contract
b. Compensation for actual loss based on the contract’s value
c. Non-monetary damages
d. Payments in excess of any compensatory damages
678) Which of the following scenarios is an example of novation?
a. Cynthia has a contract with Jack to buy his house. She terminates the contract after the inspection and writes a similar contract on a new property with Jeff.
b. Doug is buying Norm’s farm, but has a serious accident and no longer wants to own a farm, so his daughter Linda decides to buy the property. Norm agrees to the substitution of Linda for Doug in the purchase contract, effectively creating a new contract.
c. Marcie contracts to buy Suzanna’s beauty salon. Marcie gets cold feet, though, and terminates the contract.
d. Using a clause in the original purchase contract, Roxanne assigns her contractual right to purchase a property to her friend, Caroline.
679) Which of these sentences accurately describes the phrase “statute of limitations”?
a. There are deadlines for certain types of legal action.
b. There are limits to how many times someone may sue another person.
c. There are limits to the monetary damages that may be awarded in a civil suit.
d. There’s a limit to the number of statutes that may be enacted each year.
680) Which one of the following statements is true regarding a partially performed sales contract that otherwise contains all of the essential elements?
a. The contract can’t close.
b. The contract is unenforceable in court.
c. The contract is void.
d. The contract is voidable.
681) Anna and Cindy entered a contract to buy Jake’s home. However, at the last minute, Cindy had a change of heart and wanted out of the deal. Anna asked another friend, Sally, if she wanted to take Cindy’s place as a co-buyer of Jake’s home. Everyone agreed to the substitution of Sally for Cindy on the contract. Of what is this an example?
a. Assignment
b. Fraud
c. Mutual mistake
d. Novation
682) DeeAnna thought she purchased an investment property, but the seller refused to deliver the title to her. DeeAnna met all of her obligations per the written contract she and the seller signed. She decided to take the seller to court in an effort to force him to hand over the title. This is an example of ______.
a. Accepting partial performance
b. Rescinding the contract unilaterally
c. Suing for damages
d. Suing for specific performance
683) Which of these situations could be most appropriately addressed through reformation of the contract?
a. Bobby the Buyer got a promotion with the same company, and a 10% raise in salary.
b. Bobby the Buyer wasn’t approved for a mortgage loan and asks Sally if he can have his earnest money back.
c. Sally the Seller and Bobby the Buyer request a new contract after Sally notices the property address is mistyped.
d. Sally the Seller decides she cannot part with her house after all. Fortunately for her, but not so fortunately for him, Bobby
684) What phrase do many real estate contracts contain that reminds the parties to avoid unnecessary delays to the transaction, and to adhere to all contract dates?
a. Haste makes waste
b. Patience is a virtue
c. Seek the advice of an attorney
d. Time is of the essence
685) Sue Ellen has a contract to buy Roger’s house, which she has always admired, when Roger decides he’s ready to move to a senior living community. After Roger finds a suitable senior apartment and moves, Sue Ellen writes a check for the agreed-upon amount, and Roger transfers the deed to her. What is happening in this scenario?
a. Assignment
b. Breach
c. Novation
d. Performance
686) Which of these phrases is used to describe the act of correcting a contract that contains a mistake?
a. Disclosing of a contract error
b. Reformation of a contract
c. Release of a contract
d. Renewal of a contract
687) Mary agreed to buy her mother’s house when her mother planned to move to a senior living community. They signed a purchase agreement, but when Mary had to move because of work, she signed her rights in the contract over to her sister, Tina. Mary may still owe money if Tina can’t come up with the agreed-upon funds. What’s happening in this scenario?
a. Assignment
b. Breach
c. Novation
d. Performance
688) What is it called when one party to a contract transfers the contractual rights and obligations to another but remains liable for the contract terms?
a. Assignment
b. Execution
c. Novation
d. Termination
689) Eileen entered into a contract to buy Peter’s home. The contract specified that Peter must leave the refrigerator with the home, and he must replace the roof before closing. During the pre-closing walk-through, Eileen confirmed the house had a nice new roof, but also found that Peter took the refrigerator with him. Eileen decided she didn’t want the refrigerator that much anyway so she didn’t make a fuss. This is an example of ______ of the contract.
a. Partial performance
b. Performance
c. Reinforcement
d. Voiding
690) Sam entered into a contract to sell his home to Gina. After the inspection, Gina insisted that Sam replace the damaged roof. Sam refused, and the parties agreed to cancel the deal. This is an example of ______.
a. Accepting liquidated damages
b. Accepting partial performance
c. Mutually rescinding the contract
d. Unilaterally rescinding the contract
691) Jayne was tired of waiting for her subcontractor to get his part of the deal done. The agreed-upon deadlines came and went, and Jayne lost money waiting for the subcontractor to come through. She decided that if the subcontractor weren’t going to honor his commitments, neither was she, so Jayne consulted with her attorney and then terminated the contract. This is an example of ______.
a. Accepting partial performance
b. Mutually rescinding the contract
c. Rescinding the contract unilaterally
d. Suing for damages
692) Grace found herself in a breach of contract situation where the other party met some of the terms but not others. Grace thought it would cost a lot of time and money to sue, so she decided to accept the work that had been done and call it good. This is an example of ______.
a. Accepting partial performance
b. Mutually rescinding the contract
c. Rescinding the contract unilaterally
d. Suing for damages
693) Which of the following scenarios describes an example of unilateral rescission?
a. A sales transaction falls through when Nora, the buyer, doesn’t qualify for financing.
b. Bobby, the buyer, makes an offer on a house that doesn’t meet the appraisal contingency. He cancels the sale.
c. Buyer Alice decides to join the Peace Corps. She and the seller mutually agree to cancel the sale, and the seller keeps Alice’s earnest money.
d. Sally, the seller, sells her property to two different buyers. Both buyers sue Sally for specific performance.
694) Shannon and Rene are sisters who entered into a contract to buy an income property. The sisters got into a dispute, and Shannon wants out of the deal. However, their uncle Jerry wants to replace Shannon on the contract. Shannon agrees to the substitution so they go ahead and do it. If Jerry fails to live up to his obligations under the contract though, Shannon will be held responsible. Of what is this an example?
a. Assignment
b. Fraud
c. Mutual mistake
d. Novation
695) What language may be included in a contract after the assignor’s name to make it clear that the contract is assignable?
a. “And/or assigns”
b. “Buyer beware”
c. “Spouse or partner”
d. “Time is of the essence”
696) Seller Gina feels awful that Martha, who was going to buy her property, lost her job. Gina decides to ______ Martha from the purchase contract.
a. Assign
b. Reform
c. Release
d. Rescind
697) Zack enters into a contract to buy Olivia’s home. Per the terms of the contract, Zack must put down a $10,000 earnest money deposit and have the property inspected within five days. In reality, he puts down a $12,000 deposit and has the property inspected within two days. Of what is this an example?
a. Buyer misrepresentation
b. Partial performance of the contract
c. Performance of the contract
d. Voiding of the contract
698) What’s the key difference between assignment and novation of a contract?
a. Assignment releases the original party from all obligations, while novation does not.
b. Individual contracts must specifically allow novation, but not assignment.
c. Novation is disallowed in many states, while assignment is not.
d. Novation releases the original party from all obligations, while assignment does not.
699) When a buyer breaches the real estate sale contract, the seller may file a lawsuit for compensatory damages. Which of the following best describes compensatory damages?
a. A specified monetary amount agreed upon by the buyer to pay the seller, if the buyer breaches the contract.
b. A specified monetary amount the seller agrees to pay the buyer, if the seller breaches the contract.
c. Compensation for actual loss based on the contract’s value.
d. Payment in excess of the contract’s value.
700) Mary contracted to buy her mother’s house when her mother moves to a senior living community, but now Mary has to move because of work and no longer wants to buy the house. With their mother’s agreement, Mary’s sister, Tina, steps in, releasing Mary from her obligation. They write up a new contract, with the only change being that Tina is now the party to the contract rather than Mary. What’s happened here?
a. Assignment
b. Breach of contract
c. Novation
d. Performance
701) Betty hired a contractor to replace her gutters. Within days, the gutters leaked and flooded her basement. She complained to the contractor, who replaced the gutters again. The next time it rained, the gutters leaked and flooded Betty’s basement a second time. Frustrated, Betty decided to file a lawsuit against the contractor in an attempt to recover the money she lost. This is an example of ______.
a. Accepting partial performance
b. Rescinding the contract unilaterally
c. Suing for damages and breach of contract
d. Suing for specific performance
702) In contract law, when does partial performance occur?
a. When a party acknowledges receipt of the contract
b. When a party does some, but not all, of what the party has agreed to do
c. When a party meets all terms of the contract
d. When a party rejects all terms of the contract
703) Parker entered into a contract with seller Derrick to buy Derrick’s home. Before finalizing the sale, Parker had a change of heart and decided to renounce all worldly possessions. He no longer wanted to buy Derrick’s home. With Derrick’s approval, Parker is released and Parker’s brother, Tom, takes Parker’s place as the buyer in the purchase contract. Of what is this an example?
a. Assignment
b. Fraud
c. Misrepresentation
d. Novation
704) Martha made an offer to buy Drake’s home, and he accepted it. Under the terms of the agreement, Martha was supposed to make an earnest money deposit of $10,000, but she only put down $5,000. Drake accepted the lesser deposit, and the sale was ultimately finalized. This is an example of ______.
a. Accepting partial performance
b. Rescinding the contract unilaterally
c. Suing for damages
d. Suing for specific performance
705) Rescission can be ______ agreement to cancel a contract.
a. A mutual
b. An ill-advised
c. An unlawful
d. A tenuous
706) The owner of ABC Construction entered into a contract to build two homes for brothers Jack and John. The contract specified that the homes must be completed by April 1. ABC finished the homes on March 30. Of what is this an example?
a. Non-performance
b. Partial performance
c. Performance
d. Voiding
707) Francine’s landlord never returned her security deposit after she moved, even though it was in writing that she would get it back within three weeks. How long after the deadline for returning the deposit does Francine have to sue, according to California’s statute of limitations?
a. 10 years
b. Four years
c. One year
d. Two years
708) –
709) In an addendum to the purchase and sale contract, the seller agrees to paint the house before conveying the house to the buyer. The weather changes, and the seller is unable to finish painting the house before closing. Of what is this an example?
a. A void contract
b. Contract execution
c. Legal purpose
d. Partial performance
710) What is the name of the process of substituting one party to an existing contract with a new party, releasing the original party from all contractual obligations and rights?
a. Assignment
b. Execution
c. Novation
d. Re-contracting
711) Select the correct definition for “reformation of a contract.”
a. Redrafting a contract
b. Releasing one party from a contract
c. Renewing a contract
d. Suing another party to a contract
712) Bob signed a contract to purchase Ingrid’s apartment building. Bob decided he didn’t want to be a landlord, and Ingrid decided she didn’t want to sell and move to Maui. They mutually agreed to cancel the contract, and Ingrid returned Bob’s earnest money. This is referred to as ______.
a. Assignment
b. Breach of contract
c. Novation
d. Rescission
713) This is a loss of money or anything of value, due to failure to perform.
a. Covenant
b. Forfeiture
c. Listing agreement
d. Options
714) This acts as the receipt for earnest money given by the buyer to secure an offer.
a. Covenant
b. Deposit receipt
c. Listing agreement
d. Options
715) This is a legal written agreement between a buyer and seller that states the purchase price and other terms of understanding by which real property will be transferred.
a. Contract for sale
b. Covenant
c. Listing agreement
d. Options
716) Which of these is a contract between a client and agent to sell real property?
a. Contract for sale
b. Covenant
c. Deposit receipt
d. Listing agreement
717) Which of the following means a legal section in a contract or law?
a. Listing agreement
b. Option
c. Provision
d. Tender
718) What is the deciding factor when determining whether the buyer or the seller takes the loss on a property that is taken by eminent domain?
a. The amount of the earnest deposit
b. The value of the property
c. Whether or not title and possession have transferred
d. Who has eminence
719) Which of these means, “A privilege sold by one party to another that offers the buyer the right, but not the obligation, to buy at an agreed-upon price during a certain period of time or on a specific date”?
a. Commission
b. Listing agreement
c. Option
d. Tender
720) Which of these means, “An agent’s compensation for performing the duties of agency; usually a percentage of a property’s selling price”?
a. Commission
b. Listing agreement
c. Options
d. Tender
721) This is the legal agreement between a buyer and a broker hired to represent the buyer’s interest.
a. Buyer representation agreement
b. Covenant
c. Listing agreement
d. Options
722) California’s Uniform Vendor and Purchaser Risk Act clarifies the rights granted to whom?
a. The buyer and the seller
b. The buyer only
c. The buyer, seller, and their agents
d. The seller only
723) Sally the Seller and Bobby the Buyer are about to sign the closing documents when a fire truck rushes by. The house is burning down! The documents are not signed. Which of these outcomes adheres to the rights provided by the Uniform Vendor and Purchaser Risk Act?
a. Bobby does not have to pay the closing costs and will get his earnest money back.
b. Bobby does not have to pay the closing costs, but Sally gets to keep the earnest money.
c. Bobby must go through with the purchase and will seek reimbursement through insurance.
d. Sally and Bobby must split the loss 50/50.
724) Which of these means “to formally offer”?
a. Commission
b. Conveyance
c. Listing agreement
d. Tender
725) Which of these scenarios describes a voluntary lien?
a. Ruby hasn’t paid her property tax, so the state put a tax lien on her home.
b. Sam hasn’t paid the general contractor for the new deck he built on Sam’s house, so the contractor put a mechanic’s lien on Sam’s property.
c. Sharon purchased a condo and now the lender has a mortgage lien on the property.
d. The court ordered Bob to pay his debt to Leo and placed a judgment lien on Bob’s property when he couldn’t pay.
726) What type of lien is defined as an involuntary lien placed on all of the property received by a deceased person’s heirs?
a. Estate/inheritance lien
b. Income tax lien
c. Judgment lien
d. Mortgage lien
727) What criteria must be met before a document is eligible for recording in California?
a. May be on any size and type of paper
b. Must be filed electronically
c. Must be filed in person
d. Must be in writing, signed, and acknowledged before a notary public
728) Which of the following defines the term ‘lis pendens’?
a. A legal notice that a lawsuit is pending that affects the title of a property
b. A legal term that means “it depends” and requires a certain minimum sales price of the property.
c. A notice that notifies potential buyers of a pending lease
d. A public listing and notice of foreclosure of a property.
729) April owes money to quite a few people after a round of court-ordered judgment liens were placed on her property. Can you determine who would get paid first?
a. Alycea filed at the end of June and was awarded $50,000.
b. Bob filed in May and was awarded $85,000.
c. Frank filed in February and was awarded $10,000.
d. Sarah filed in March and was awarded $15,000.
730) Why is it important to publicly record a deed?
a. The title insurance policy schedule of exceptions will include anything that’s publicly recorded.
b. Title insurance policies don’t cover publicly recorded events.
c. Title insurance policies must be publicly recorded to be legal.
d. Title representatives and attorneys who perform title searches look for documents that are publicly recorded.
731) Which of these statements is NOT true about a specific lien?
a. It may allow the creditor to sell the property through a court sale (foreclosure) and be repaid from the proceeds of the sale.
b. It prevents the debtor from transferring the property until the debt has been repaid.
c. It’s a lien against a single property rather than a person.
d. It’s always involuntary.
732) How is priority determined in cases where more than one judgment lien is filed against a property?
a. The government has priority, followed by whoever is owed the most next.
b. Whoever filed their claim first receives priority.
c. Whoever is owed the most money has priority.
d. Whoever paid to receive priority service at the county clerk’s office.
733) Conrad just closed on the house he’s buying to fix up. Why should he follow up to be sure the deed has been recorded?
a. He can’t legally make any improvements to the property until the deed is recorded.
b. He doesn’t legally own the house until that occurs.
c. Recording provides actual notice that he owns the property.
d. Recording provides constructive notice that he owns the property.
734) What makes an income tax lien different from a property tax lien?
a. An income tax lien has priority over a property tax lien and will be paid first upon foreclosure.
b. An income tax lien is a general lien and a property tax lien is a specific lien.
c. An income tax lien is placed by the federal government and a property tax lien is placed by the state.
d. An income tax lien is voluntary and a property tax lien is involuntary.
735) What type of notice results from publicly recording a title transfer?
a. Actual notice
b. Attorney notice
c. Constructive notice
d. Proper notice
736) Which of the following defines an income tax lien?
a. Involuntary lien placed against a property owner’s property due to a court decree resulting from a lawsuit.
b. Involuntary lien placed against a property owner’s property for due and unpaid taxes
c. Involuntary lien placed on all property inherited by a deceased person’s heirs.
d. Voluntary lien against a single property that uses the property as collateral for repayment of a loan.
737) In addition to being properly executed (signed), what are other requirements for recording a document in California?
a. Acknowledged before a notary public
b. At least two witnesses present at the time of filing
c. Meet SEQRA standards
d. Sealed and mailed in a registered envelope to the county clerk’s office
738) Joshua won his lawsuit against Savannah. The judge awarded him $30,000. Savannah was unable to pay, so the court placed a ______ on her home.
a. Foreclosure action
b. Judgment lien
c. Lis pendens
d. Mortgage lien
739) Which option is true if a deed is not recorded after closing?
a. The buyer must pay a fine to the seller.
b. The entire closing is void.
c. The property’s legal ownership can be challenged.
d. The title never changes hands from the seller to the buyer.
740) Which of these scenarios describes a voluntary specific lien?
a. The court placed a lien on the property Marge inherited upon Homer’s death.
b. The IRS placed a lien on Lisa’s property when she failed to pay her income taxes.
c. When Jack and Jill refused to pay the roofing contractor, he placed a lien on their property.
d. When Rob and Sue bought their house using a mortgage, the lender put a lien on the property.
741) Under which of the following circumstances would a mechanic’s lien be attached to a property?
a. The court has determined that the owner must pay for damages from a civil court case.
b. The owner fails to pay his homeowners association dues.
c. The owner fails to pay his property taxes.
d. The owner fails to pay the builder who added an extra bedroom to the house.
742) Which option describes a real property tax lien?
a. General and involuntary
b. General and voluntary
c. Specific and involuntary
d. Specific and voluntary
743) Daisy and her kids loved their new pool, but Daisy wasn’t so happy when she received notice that the general contractor who poured the concrete had placed a lien on her home. Daisy went through her records and discovered that she had never paid the general contractor. What’s true about this situation?
a. Daisy can now place a lien on the general contractor’s property.
b. The lien is illegal.
c. This is a legal judgment lien.
d. This is a legal mechanic’s lien.
744) What type of involuntary lien is placed on a person’s estate after their death if there are unpaid debts to creditors?
a. Deceased person’s debt lien
b. Estate/ inheritance tax lien
c. Mechanic’s lien
d. Real property tax lien
745) What type of individual’s property is affected by a general lien?
a. All real property and personal property
b. One specific property
c. Only personal property, not real property
d. Only real property and not personal property
746) Dorcas and Ralph were married for 15 years. Ralph, an accountant, always took care of the bills and other financial matters for the couple. Then Dorcas discovered that Ralph had failed to pay the property tax on their property for the last three years. Which of these is likely to happen?
a. Dorcas and Ralph will be required to sell their home to the state for the amount of property tax owed.
b. The state will place a condemnation order on their property so they can’t transfer their property until the debt is satisfied.
c. The state will place a mortgage lien on their home for the amount of property tax owed.
d. The state will place a tax lien on their property so it can’t be transferred without satisfying the debt.
747) What’s the definition of a judgment lien?
a. An involuntary lien due to a court decree resulting from a lawsuit
b. An involuntary lien placed on all of the property received by a deceased person’s heirs
c. An involuntary lien placed on a person’s estate after his or her death if there are unpaid debts to creditors
d. A voluntary lien against a single property that uses the property as collateral for repayment of a loan
748) When property changes hands, the deed is recorded and a fee is charged. What is the benefit to the grantee of having the deed recorded?
a. It impacts who owns the property.
b. It protects against foreclosure.
c. It puts the public on notice regarding ownership.
d. It’s required by law.
749) What’s the term for a notice given directly to and received by a person?
a. Actual notice
b. Constructive notice
c. Proper notice
d. UPS notice
750) Which one of the following is true about ownership or title to a property?
a. Constructive notice to the public of real property ownership occurs when the deed is recorded.
b. The last party to record has priority.
c. The seller is responsible for paying for owner’s and lender’s title insurance.
d. Title isn’t finalized until the deed has been recorded.
751) Christina purchased a house from Thomas. When did she officially gain ownership of the property?
a. After the appraisal was completed
b. Prior to closing after approving the Loan Estimate
c. When actual notice of the deed was given to the mortgage company
d. With the transfer of deed from the seller to the buyer
752) –
753) –
754) –
755) –
756) How long after a notice of cessation or completion is filed can a contractor file a mechanics lien?
a. Within 60 days
b. Within 90 days
c. Within six months
d. Within two years
757) In California, which lien can be filed later than other liens and still have priority over them?
a. Income tax lien
b. Judgment lien
c. Mechanic’s lien
d. Real property tax lien
758) In California, what is filed by the trustee to notify borrowers that the foreclosure process will begin?
a. Notice of Default
b. Notice of Delinquency
c. Notice of Foreclosure
d. Notice of Sale
759) Which of the following options describes a subordination agreement?
a. An agreement between a contractor and any subcontractors
b. An agreement between a landowner and a contractor
c. An agreement between the court and landowner to decrease property taxes
d. An agreement between two lien holders to modify the order of lien priority
760) Frank has waited 30 days after notifying a client that the project he finished remains unpaid. The client has not filed a notice of completion or cessation with the county clerk. How long does Frank have left to file a mechanic’s lien?
a. 10 days
b. 30 days
c. 60 days
d. 90 days
761) How long does a homeowner have to pay off outstanding liens against his property?
a. 30 days
b. One week before the foreclosure sale is held
c. Until the foreclosure sale is held
d. Up to 10 years
762) Karen’s house was recently foreclosed on to pay off a lien on her home. What happens to any extra money after the lien and expenses of the sale are paid?
a. It goes to Karen.
b. It’s given to a local government-approved charity.
c. The bank receives the rest as compensation.
d. The state government receives the extra funds.
763) Which action can be taken if you don’t pay a lien against your property?
a. Accretion
b. Condemnation
c. Eminent domain
d. Foreclosure
764) What does the right of redemption allow?
a. It allows a property owner to freely give away her property to another and release it of any and all liens against it.
b. It allows a property owner to pay back any debts or liens against their property until a foreclosure sale is held.
c. It allows a property owner to sue a neighboring property owner over boundary disputes.
d. It allows the government to satisfy liens against a property through a foreclosure sale.
765) What can a property owner do to stop contractors performing unauthorized work from filing mechanic’s liens later?
a. File a lien release
b. File a notice of completion
c. Post and file a notice of nonresponsibility
d. Require the contractor obtain a payment bond
766) Which option best defines an equitable lien?
a. An income tax lien
b. A real property tax lien
c. Created by a court of common law; doesn’t give the right to possession of the property
d. Created by law and gives right of possession
767) One of Jackie’s creditors sued her in civil court. As a result of the judgment against her, her house, car, and art collection were all subject to sale in order to pay the creditor. What type of lien is this?
a. General
b. Special assessment
c. Vendor’s
d. Voluntary
768) What’s it called when lien holders allow another lien holder’s claim to have priority over their own?
a. Equitable lien
b. Lis pendens
c. Subordination agreement
d. Voluntary lien
769) What would happen if you bought a house and later found out that there were unpaid liens against the property?
a. Nothing. The former owner owes the money on the liens.
b. The lien claimants would lose their liens against your property.
c. The unpaid liens could trigger a foreclosure on your property.
d. You would have to assume a loan to pay off the liens.
770) Homeowners Daryl and Stella, who are both in their 70s, paid off their mortgage during good times, but recent medical bills have overcome them and their creditors have a judgment lien against their property. They decide to sell their home and downsize to pay off their bills. Which of these is NOT true about the homestead exemption for Daryl and Stella?
a. It protects $175,000 of their equity.
b. The holder of the judgment lien will be paid before they receive their exemption.
c. They’ll need to purchase another home within six months of the sale.
d. They must first file a declaration of homestead.
771) How can a foreclosure be stopped or prevented?
a. Auction
b. Fleeing the state
c. Paying all outstanding liens against the property
d. Refinancing
772) In a foreclosure situation, which lien has highest priority of the options listed below?
a. A judgment lien
b. A mechanic’s lien
c. An income tax lien
d. A real property tax lien
773) Which process temporarily stalls foreclosure?
a. Filing for Chapter 7 bankruptcy
b. Fleeing the state
c. Making a request for a break
d. Paying off all debts
774) How are creditors or lien holders paid during a foreclosure process?
a. Lien holders are given a referee’s deed to the property.
b. Tax refunds are disbursed after supplying a foreclosure affidavit to the court.
c. The property is portioned among the lien holders to have or to sell.
d. The property is sold at auction and lien holders are paid from the proceeds of the sale.
775) You have just started a construction project on your property and have hired a contractor to do some of the work. The contractor then brings on several subcontractors to do some of the tasks. What can you do to protect yourself from subcontractor liens should the contractor not pay them?
a. File a lien release.
b. File a notice of completion.
c. Nothing. There is no defense against unpaid subcontractors.
d. Require the contractor obtain a payment bond.
776) Which term means property that is used as the owner’s primary residence?
a. Estoppel
b. Homestead
c. Lis pendens
d. Reliction
777) California homeowner Randy, who is 40 years old and lives alone, owes some creditors but hasn’t been able to pay them. They place a lien on his home. He owes $35,000 on his mortgage, and the property’s market value is about $250,000. What can happen in this situation?
a. Randy doesn’t qualify as a family unit so he won’t receive protection from the homeowner exemption.
b. Randy must file a declaration of homestead to receive equity protection since he owes less on his mortgage than the home is worth.
c. The homeowner exemption will prevent the forced sale of his home.
d. The homeowner exemption will protect some of his equity, but the courts may force the sale of his home.
778) What happens after a foreclosure if there isn’t enough money from the sale to pay off all of the lien holders against a property?
a. All claims are void if there isn’t enough money after the foreclosure sale of the property.
b. The former owner may owe a debt to lien holders who aren’t fully paid.
c. The former owner’s wages will be garnished for the remainder of what’s owed.
d. The lien holders must refile on the former owner’s next property.
779) What is the process used to sell a foreclosure home in California called?
a. Default sale
b. Fire sale
c. Referee’s sale
d. Trustee’s sale
780) What is the six-month rule for homestead exemptions?
a. No liens may be filed against homesteads unless at least six months’ notice has been given to the homeowner.
b. The property owner has six months to sell the property after a lien is filed.
c. The property owner must live in the home for at least six months before they may qualify for a homestead exemption.
d. The property owner must reinvest the homestead exemption amount within six months in another homestead to protect it from creditors.
781) Which option best defines a statutory lien?
a. A judgment lien
b. A mortgage
c. Created by a court of common law; doesn’t give the right to possession of the property
d. Created by law and gives right of possession
782) Who has the right to make the first bid during a trustee’s sale in California?
a. Anyone
b. The beneficiary (lender)
c. The trustee
d. The trustors (borrowers)
783) How can a foreclosure process be temporarily stalled?
a. By filing for Chapter 7 bankruptcy
b. By fleeing the state
c. By paying off all debts
d. By request
784) How long after a project begins must a contractor give the owner preliminary notice of their right to file a mechanic’s lien in California?
a. Within 20 days
b. Within 90 days
c. Within one year
d. Within six months
785) Which document is used to establish proof of ownership?
a. Abstract of title
b. Chain of title
c. Deed
d. Title insurance
786) Jeff has filed a quiet title suit against Roger. What’s the purpose of this suit?
a. To clear up a cloud on title
b. To clear up a property line dispute
c. To exercise his right to quiet enjoyment of the property
d. To prohibit the seller from releasing the buyer’s name
787) What is the purpose of the title search?
a. To collect evidence that the title is a marketable title, meaning it’s clear and free of encumbrances
b. To ensure the current owner has the title to give to the buyer
c. To ensure the title is on the record at the local clerk recorder’s office
d. To insure the owner against any financial loss due to a defect in the title
788) Anita is a new buyer. Luckily, ______ will help her before the sale and can reimburse her after the sale if a title issue arises.
a. Her buyer’s agent
b. Her title insurance
c. Seller credits
d. Seller disclosures
789) Which of these statements is NOT true about an extended title insurance policy?
a. It covers some items that aren’t part of the public record, such as unrecorded liens.
b. It’s typically purchased for the lender.
c. It’s typically used when the property is paid for in cash.
d. The buyer will most likely pay for this policy.
790) You’re working with a client, Donny, who’s found his dream home in the neighborhood where he grew up. Unfortunately, the title search finds some issues and the title company refuses to issue a policy. Donny still wants to go forward with the purchase, and since he’s paying cash, he doesn’t have to worry about obstacles from a lender. In California, what is one thing that has to happen in this situation?
a. Donny must receive written notice that no title insurance will be provided.
b. The escrow agent must record the refusal to provide title insurance with the county clerk and recorder.
c. The seller must use a warranty deed to transfer ownership rather than a grant deed.
d. You must refuse to continue representing Donny in order to protect your license.
791) What’s a quiet title action?
a. A lien placed against a potential land owner for property purchased by another
b. An action to locate and notify all who may have some claim on the title, and determine the validity of all claims
c. A type of title insurance that reimburses the policyholder if the neighborhood is noisier than normal
d. A way to anonymously purchase property without filing the title or transfer on record
792) What type of title insurance covers defects of an incorrect survey and boundary encroachments?
a. Extended title insurance
b. Homeowners insurance
c. Standard title insurance
d. Title survey and boundary insurance
793) In a typical transaction, which of these title defects is unlikely to cause a problem for the buyer?
a. A faulty survey
b. An unrecorded lien
c. A past error in recording title transfer
d. The seller’s existing mortgage
794) Which document is used to give a buyer an overview of the title history and information about what is or isn’t covered in an insurance policy?
a. Abstract of title
b. Guarantee of title
c. Preliminary report
d. Title insurance
795) Your buyer client is following your advice and has obtained title insurance. The policy is from ______ and shows the legal description of the property and the standard items it covers, such as encumbrances of record.
a. American Land Title Association (ALTA)
b. California Land Title Association (CLTA)
c. General Land Title Association (GLTA)
d. Standard Land Title Association (SLTA)
796) Which document establishes path and proof of ownership?
a. Abstract of title
b. Chain of title
c. Deed
d. Title insurance
797) Lisa purchased an older home with a large backyard that’s perfect for her pack of collies to romp in. Six months after she bought the property, a total stranger knocked on her door and told her he’s the true property owner. After investigating, it turns out the person who sold Lisa the property had forged the deed without the true owner’s knowledge. What’s true about Lisa’s situation?
a. Her homeowner’s policy may protect her from loss.
b. Her lender must initiate a quiet title action to resolve the issue.
c. Her title insurance policy may protect her from loss.
d. The county clerk where the documents were recorded is liable.
798) Your client, Ray, is worried about title issues that may arise after closing. Remind Ray of his secret protection: ______.
a. Buyer Trust Fund
b. Litigation
c. Seller guarantees
d. Title insurance
799) As a licensee, you’re helping a couple buy a new home when you come across issues that could mean there’s a cloud on the title. What should you do?
a. Encourage the couple to move forward with the purchase and not worry about the clouded title.
b. File an affidavit with the court about the knowledge of the clouded title and tell the couple to move forward with the sale.
c. Keep moving forward with the sale but recommend the couple purchase title insurance to insure against any potential title problems.
d. Recommend the couple find another property to purchase, or ask the seller to settle the title through a quiet title action to clear any cloud before moving forward with the sale.
800) Marsha’s title insurance policy was issued on closing day, which was June 18. The policy lists the standard exclusions as well as requirements for the company to issue the policy, such as paying off existing recorded liens. Which one of these will NOT be addressed in the schedule of exceptions?
a. Marsha’s second mortgage on the property, which she plans to get next January
b. Marsha’s unrecorded lease on the property
c. Smith and Martin Building and Rehab’s mechanic’s lien, which was filed on June 18
d. The local cable company’s unrecorded easement through the property for underground wiring. Marsha disclosed this to the title company
801) What special concern do foreclosed properties often present?
a. Buying the property at a discount may have tax implications.
b. The homeowners may or may not have property insurance.
c. The property sale may be subject to additional fees that will be passed to the new buyer.
d. There could be hidden title issues.
802) What can buyers do to protect themselves from title issues when purchasing property?
a. Ensure the seller’s name is on the deed.
b. File a lis pendens claim at the court before buying the property.
c. File a security agreement at the county clerk’s office.
d. Purchase title insurance.
803) Which one of the following protects the owner against financial loss if the real estate title has defects?
a. Abstract of title
b. Chain of title
c. Deed
d. Title insurance
804) Paula is bidding on a property that’s being sold at a foreclosure auction. She’s excited about the great deal she’s getting on the property after she finds out she submitted the winning bid. What could cause Paula’s great deal to turn into a nightmare?
a. The lender has the option to refuse her bid and revoke the deed transferring ownership to Paula.
b. The previous owner may redeem the property by paying Paula at least 50% of the property’s market value.
c. The title insurance company may charge her additional fees after closing to continue the title policy.
d. The title to the property may have hidden issues that could cost her a lot of money to clear.
805) What’s a marketable title?
a. A title that a relative has gifted
b. A title that has been granted by public grant
c. A title that is about to go on the market
d. A title that is clear and free of encumbrances
806) Which document is used to provide a summary of the title history?
a. Abstract of title
b. Chain of title
c. Deed
d. Title insurance
807) Real estate licensees who want to uphold the Fair Housing Act should make a habit out of which of the following actions?
a. Disclose their protected status to all clients.
b. Present sellers with offers from people of the same class so they don’t ask the licensee to discriminate.
c. Show buyers properties in neighborhoods where they are unlikely to experience discrimination.
d. Tell potential clients in their initial meeting that they are committed to upholding fair housing laws.
808) Which agency enforces Title II under the Americans with Disabilities Act of 1990, when it relates to state and local public housing, housing assistance, and housing referrals?
a. Department of Civil Rights
b. Department of Equal Opportunity
c. Department of Housing and Community Development
d. Department of Housing and Urban Development
809) Individuals who experience housing discrimination are provided the opportunity to file a complaint based on the provisions of which act?
a. Americans with Disabilities Act of 1990
b. Civil Rights of 1866
c. Fair Housing Act of 1968
d. Fair Housing Amendments Act of 1988
810) Which protected class refers to a group of people who share common characteristics, typically physical characteristics, such as skin color?
a. Familial status
b. National origin
c. Race
d. Religion
811) Which of these statements best represents what happens after a federal fair housing complaint is made?
a. A fair housing specialist will review the complaint.
b. An official housing discrimination complaint will be filed, and a fair housing specialist will be assigned to the case.
c. FHEO will contact the alleged perpetrator to gather information.
d. HUD will review the complaint to determine if it’s valid.
812) In case history regarding fair housing, which case involved an ordinance that prohibited blacks from living on a block where the majority of the residents were white?
a. Brown vs. Board of Education
b. Buchanan vs. Warley
c. Jones vs. Mayer
d. Plessy vs. Ferguson
813) The Office of Fair Housing and Equal Opportunity is a part of which federal department?
a. CIA
b. HHS
c. HUD
d. NHA
814) Which type of property is exempt from the Fair Housing Act?
a. Condominium with no more than eight units
b. Condominium with no more than four units
c. Owner-occupied with no more than eight units
d. Owner-occupied with no more than four units
815) Which act created the Office of Fair Housing and Equal Opportunity under the Department of Housing and Urban Development?
a. Americans with Disabilities Act of 1990
b. Equal Credit Opportunity Act of 1974
c. Federal Fair Housing Act of 1968
d. Housing and Community Development Act of 1974
816) If a private individual owner doesn’t own more than three single-family homes at one time, which exemption from the Fair Housing Act could apply?
a. Housing designated for senior use
b. “Mrs. Murphy” exemption
c. Owner-occupied buildings with no more than six units
d. Single-family housing sold or rented without the use of a broker
817) What protected class is involved when there is discrimination due to a person being lighter-skinned or darker-skinned?
a. Color
b. Familial status
c. National origin
d. Race
818) Your client submits an application to rent a condo unit. He has excellent credit and has had the same job for a long time. He uses a cane to help with his mobility. When his application is rejected, he feels it’s due to his disability. He is protected under what federal law?
a. Civil Rights Act of 1866
b. Fair Housing Amendments Act of 1988
c. Federal Fair Housing Act of 1968
d. Housing and Community Development Act of 1974
819) Which U.S. Supreme Court decision consolidated five cases involving the constitutionality of state-sponsored segregation in public schools?
a. Brown vs. Board of Education
b. Buchanan vs. Warley
c. Jones vs. Mayer
d. Plessy vs. Ferguson
820) The Housing and Community Development Act of 1974 added which protected class to federal fair housing law?
a. Color
b. Disability
c. Religion
d. Sex
821) Contrary to federal fair housing laws, the state where Katrina lives includes age as a protected class. Which of these statements about this conflict is true?
a. Katrina can follow either the federal or the state law as long as she is consistent.
b. Katrina is permitted to follow whichever law is least restrictive.
c. Katrina must follow federal law for any federally related transaction.
d. Katrina must follow the more restrictive of federal or state law.
822) Prior to a certain act’s existence, there was no legal protection for women who endured sexual harassment from landlords and sellers when they attempted to obtain housing. What’s this act called?
a. Civil Rights Act of 1866
b. Fair Housing Amendments Act of 1988
c. Federal Fair Housing Act of 1968
d. Housing and Community Development Act of 1974
823) A mortgage lender has landed in hot water for fair housing discrimination. Which of these actions might have gotten the lender in trouble?
a. Denying a loan based on income-to-credit ratio
b. Denying a loan that was pre-approved after the mother stops working to care for her baby
c. Imposing different interest rates based on credit scores
d. Refusing to provide literature about loans to consumers with poor English language skills
824) If a landlord refuses to rent an apartment to two single women who live together, this is discrimination on the basis of what federally protected class?
a. Familial status
b. Lifestyle
c. Same sex relationship
d. Sex
825) Which agency enforces fair housing law?
a. FFA
b. FHEO
c. NFHA
d. NHA
826) Which of these actions is legal?
a. A landlord offers an apartment to a woman only if she goes out with him.
b. A landlord refuses to show or rent an apartment to someone who is not Christian or Jewish.
c. A landlord requires a larger deposit for each child who will be living in the home.
d. A man advertises for a roommate to share his two-bedroom apartment and specifies that he prefers female roommates.
827) A landlord with a strict “no pets” policy won’t rent to a woman who uses a service animal to assist with her epilepsy. Which of the following is a true statement about this situation?
a. This is discrimination based on disability.
b. This is discrimination based on familial status.
c. This isn’t discriminatory because service animals are restricted to the vision-impaired.
d. This isn’t discriminatory if the “no pets” policy is universally applied.
828) In what way did the Supreme Court case of Brown vs. Board of Education affect the way fair housing laws are implemented today?
a. The court found that racially segregated school buses were unconstitutional.
b. The court legalized racial segregation through the “separate but equal” doctrine.
c. The court’s decision made segregated school boards illegal.
d. The decision overturned the doctrine of “separate but equal.”
829) A family of four, with children ages six and nine, is denied the opportunity to view an available unit in housing intended for older persons. Which of the following statements is true?
a. The federal Fair Housing Act allows an exemption for communities that are designed and operated for older persons.
b. The federal Fair Housing Act allows an exemption for communities that don’t have playgrounds or play areas for children.
c. This is a violation of the federal Fair Housing Act because it discriminates on the basis of age.
d. This is a violation of the federal Fair Housing Act because it discriminates on the basis of familial status.
830) Which agency is charged with enforcing fair housing laws and holding all parties accountable for compliance with these laws and regulations?
a. Office of Civil Rights
b. Office of Equal Credit Opportunity
c. Office of Fair Housing and Equal Opportunity
d. Office of Housing and Community Development
831) Why did the Civil Rights Act of 1866 fail to have an immediate impact on practice?
a. It was unconstitutional.
b. Nobody understood the Civil Rights Act.
c. The protected classes had to be approved.
d. There was no agency put in place to enforce the laws.
832) Which act provides consumers with remedies if they become victims of discrimination in the sale, rental, or financing of housing?
a. Civil Rights Act of 1866
b. Equal Credit Opportunity Act of 1974
c. Fair Housing Amendments Act of 1988
d. Housing and Community Development Act of 1974
833) In what year was the Americans with Disabilities Act made law?
a. 1950
b. 1978
c. 1988
d. 1990
834) Jericho and Cindy, an unmarried couple, have three children, ages 3, 5, and 12. A seller’s broker refuses to show them a house in a neighborhood where residents tend to be older, and no one else has children. Which protected class status applies?
a. Age status
b. Familial status
c. Marital status
d. Partnership status
835) The Millers moved to a small town and were interested in buying a house. At the first meeting with real estate sales professional Nora, she asked them where they went to church. They replied that they were atheists and didn’t attend church. Nora then told them that she didn’t know of any listings that met their needs, even though that wasn’t true. Nora is discriminating based on _______.
a. Familial status
b. National origin
c. Religion
d. Sex
836) Which decision stated that separate facilities for blacks and whites were constitutional as long as they were “equal”?
a. Brown vs. Board of Education
b. Buchanan vs. Warley
c. Jones vs. Mayer
d. Plessy vs. Ferguson
837) Title VIII of which law prohibits discrimination in the sale, rental, and financing of housing?
a. Civil Rights Act of 1866
b. Civil Rights Act of 1968
c. Equal Credit Opportunity Act of 1974
d. Housing and Community Development Act of 1974
838) A landlord refuses to show or rent an apartment to someone who is not Christian or Jewish. What type of discrimination is this?
a. Disability discrimination
b. Familial status discrimination
c. Racial discrimination
d. Religious discrimination
839) Which fair housing case tested discrimination in a private sale?
a. Brown vs. Board of Education
b. Buchanan vs. Warley
c. Jones vs. Mayer
d. Plessy vs. Ferguson
840) A homeowner has converted two rooms in his home to a rental unit. What does the “Mrs. Murphy” exemption permit him to do?
a. Advertise for a tenant of a specific race.
b. Move out of the property and rent both portions of it, relying on the “Mrs. Murphy” exemption to permit renting only to single females.
c. Refuse to rent to a female tenant.
d. Use the services of a real estate professional to advertise for a male tenant.
841) Which of these is something that is NOT requested in the initial fair housing complaint form?
a. A description of the alleged discrimination
b. A notarized copy of the complaint description
c. The applicable protected class of the complainant
d. The physical location of the discrimination event
842) Which protected class is protected against discriminatory practices, such as against placing limitations on the number or age of children in the residence?
a. Familial status
b. Marital status
c. National origin
d. Partnership status
843) A fair housing specialist is reviewing fair housing complaints. Which of these contains an action that is prohibited?
a. An appraiser inflates the value of a property because the person buying the property stole his girlfriend in high school.
b. A pregnant woman was not given the opportunity to rent a room in a three-bedroom house because the owner doesn’t want to live with a baby.
c. A real estate professional doesn’t respond to any requests to view a property.
d. A transgender woman is evicted from a rental property because she makes the neighbors uncomfortable.
844) When state and federal laws differ, as they sometimes do with fair housing and/or human rights, which of these statements is true?
a. State and local law override federal law.
b. State lawmakers decide which law prevails.
c. The conflicting law is invalidated, effectively removing the law’s requirements.
d. The state law may not remove rights granted to citizens under the federal law.
845) Which of these situations does the Americans with Disabilities Act address?
a. Marcus, a property manager, routinely dismisses rental applications from families with children under the age of 18.
b. Meridian Apartments provides a gym and pool area for residents, but it’s not accessible to residents who use wheelchairs.
c. Metro Agents hired an interpreter to assist Spanish-speaking clients with the real estate process.
d. The Golden Gate senior housing center has no exercise or activity center for its residents.
846) Which act was the first to prohibit any exceptions for discrimination based on race or color?
a. Civil Rights Act of 1866
b. Fair Housing Amendments Act of 1988
c. Federal Fair Housing Act of 1968
d. Housing for Older Persons Act of 1995
847) Which of these statements accurately describes finance- and housing-related legislation?
a. As a stipulation of the Housing and Community Development Act, lenders must offer reasons when rejecting loan applications and must respond to all applications within 30 days.
b. The Americans with Disabilities Act added familial status and disability (both physical and mental) to the existing protected classes.
c. The Equal Credit Opportunity Act of 1974 required lenders to provide consumers with equal access to credit and prohibited credit discrimination based on just the three protected classes of race, color, or national origin.
d. The Fair Housing Act of 1968 prohibited discrimination in the sale, rental, and financing of housing based on race, color, religion, or national origin.
848) Which of these scenarios is legal?
a. A homeowner makes a room available for rent in her residence, but only interviews female applicants.
b. A property manager refuses to show a property to a blind person with a guide dog because the property does not allow pets.
c. A selling agent does not respond to a request to view a listed property because the person’s accent in the voicemail is very thick.
d. The sellers refuse to consider an offer from someone who looks like a man wearing women’s clothing, because they don’t think the neighbors would be happy if they sold their house to someone who might be transgender or gay.
849) Rhonda and Jade both consider themselves to be African-American, although Rhonda has much darker skin and hair than Jade. When Rhonda went to the Valley Falls apartment manager’s office to request a rental application, she was told there were no vacancies. Jade went in a day later and received an application. This may be discrimination based on _______.
a. Color
b. National origin
c. Race
d. Sex
850) As a stipulation of a specific act, lenders must offer reasons when rejecting loan applications and must respond to all applications within 30 days. What’s the name of this act?
a. Americans with Disabilities Act of 1990
b. Equal Credit Opportunity Act of 1974
c. Fair Housing Amendments Act of 1988
d. Federal Fair Housing Act of 1968
851) Which act states that communities and facilities that meet certain criteria for providing housing to older persons are legally exempt from familial status discrimination?
a. Fair Housing Amendments Act of 1988
b. Federal Fair Housing Act of 1968
c. Housing and Community Development Act of 1974
d. Housing for Older Persons Act of 1995
852) Which of these situations would be exempt from most provisions of the federal Fair Housing Act?
a. A homeowner engages a real estate professional to rent out his basement apartment.
b. An investor owns and rents out five duplexes.
c. A non-profit owns 20 properties that it only rents to Caucasian families.
d. The local Elks club owns a property that’s rented only to Elks club members.
853) What is the length of the statute of limitations to file a fair housing complaint with HUD?
a. 10 years
b. Five years
c. One year
d. Seven years
854) How does the Office of Fair Housing and Equal Opportunity support real estate consumers?
a. The FHEO conducts regular audits of licensee advertising activities for fair housing violations.
b. The FHEO makes loans available to first time home buyers.
c. The FHEO provides financing education for future homeowners.
d. The FHEO provides support for protected classes through the fair housing complaint process.
855) Your client tells you to do something. It would violate fair housing laws, but it will earn you an amazing commission. What should you do?
a. Explain that you cannot do it, because it’s a fair housing violation, and you could both get into trouble for doing what she’s asked.
b. Immediately fire her as your client and report her as a violator of federal fair housing laws.
c. Try to talk her out of it, but then go along with what she asks. If you don’t, someone else will, and then they’ll get to cash that giant check.
d. You should do what she asks. As your client’s agent, you owe her the duties of loyalty and obedience above all.
856) To whom/which entity should a licensee who’s been threatened with violence after refusing to violate fair housing law report the threat?
a. HUD
b. Law enforcement officials
c. The governor
d. The National Fair Housing Alliance
857) Which of these might bring a charge of illegal steering against a licensee?
a. Benny screens the properties he shows his clients based on the clients’ preferences.
b. Johnny is working with a client who has a disability. At the client’s request, Johnny refrains from showing the client listings that aren’t ADA accessible.
c. Norton encourages his clients to contact local agencies to learn more about a neighborhood’s schools, crime rates, and religious institutions.
d. When working with single female clients, Cassandra is careful to promote properties in neighborhoods she considers safe.
858) Which of these is an example of blockbusting?
a. A lender withholds mortgage loans in areas considered demographically risky.
b. A licensee doesn’t tell her buyer client about a first-floor condo because she felt it wasn’t safe for the client.
c. A licensee focuses on showing properties in areas that are demographically similar to her buyer clients’ ethnicity.
d. A real estate licensee approaches a homeowner as soon as a demographic shift starts to occur in her neighborhood and convinces her that she needs to sell now, or she’ll never be able to sell.
859) What’s the term for a lender refusing to lend in a specific area, often based on the area’s minority make-up?
a. Blockbusting
b. Gerrymandering
c. Redlining
d. Steering
860) What’s the term for the illegal practice of nudging buyers away from or toward a specific area based on the presence or absence of protected class members?
a. Blockbusting
b. Gerrymandering
c. Redlining
d. Steering
861) Which one of these situations represents the illegal practice of redlining?
a. Arlo, a licensee, distributed a flyer in several neighborhoods warning of impending commercial developments that would negatively impact property values.
b. Based on the neighborhood’s demographics, Hunter, a mortgage broker, refused to underwrite mortgage applications from applicants who want to buy in specific neighborhoods.
c. Eunice refused to allow her listing broker to show her house to families with children.
d. Jaime was working with Korean clients, so he focused on showing them homes in Korean communities because he thought they would be more comfortable there.
862) How should you respond if your buyer says the following? “We’re looking for a three-bedroom, two-bathroom home. We have young children, so we want to make sure we’re in a good neighborhood—somewhere safe, where we’ll find a lot of good families and neighbor kids that we’d want our children to play with.”
a. “I can screen neighborhoods based on good school districts for you. That usually means you’ll end up in the kind of neighborhood you want.”
b. “If you provide me with specific kinds of people you want to avoid, I can screen the properties more closely.”
c. “If you provide me with specific neighborhood names, I can certainly look for homes in those areas. You can learn about the different neighborhoods in the area at neighborhoodscout.com.”
d. “Let’s keep this off the record. We just need to make sure it all looks legitimate from the outside.”
863) Which act attempted to eliminate discrimination caused by blockbusting, steering, and redlining?
a. Civil Rights Act of 1866
b. Fair Housing Act of 1968
c. Housing Discrimination Act of 1974
d. HUD Act of 1961
864) What discriminatory lending practice by lenders resulted in the destruction of whole neighborhoods, with perfectly good housing left abandoned?
a. Blockbusting
b. Gerrymandering
c. Redlining
d. Steering
865) Which of these is a recommended strategy for a real estate professional who wants to avoid being asked to violate fair housing laws?
a. Let consumers know upfront that you adhere to fair housing laws.
b. Only work with clients who are the same race as you.
c. Quiz clients on their views about protected classes.
d. Require your clients to complete training on fair housing laws.
866) Early in its history, the Federal Housing Administration officially supported keeping “incompatible” racial groups out of the newly developed white suburbs. What is this practice known as?
a. Blockbusting
b. Consolidating
c. Redlining
d. Steering
867) In 1934, when the Federal Housing Administration was created, it adopted the practice of crossing off cities and neighborhoods it considered risky and refused to insure loans for purchases in those areas. What is this action called?
a. Blockbusting
b. Gerrymandering
c. Redlining
d. Steering
868) How would you respond if your seller makes the following request? “We’ve lived here 10 years and love our neighbors. They’re really concerned about the changes happening to the blocks around us, so we want to be careful about who we sell this house to. You know what we mean. You’ll help us find the ‘right’ kind of buyer, won’t you?”
a. “I can’t technically do that, but I could choose to advertise only in publications that target a white readership.”
b. “I’m sorry that you feel that way. I am obligated to obey the requests of my clients, but I’m going to need you to write up your request and sign it, so there’s no way I can get in trouble for fair housing violations.”
c. “It would be illegal to limit the search based on race or religion or anything like that, but I promise I’ll find you the most qualified buyer I can, and we’ll sell this house for the highest price possible.”
d. “Let’s keep this off the record. As long as we can come up with other reasons to disqualify the buyers you don’t want, we’ll be okay. We just need to make sure it looks legitimate from the outside.”
869) Which of these sentences most accurately describes the purpose of the Unruh Civil Rights Act?
a. The act grants protections to members of protected classes from discrimination by business establishments.
b. The act protects everyone from discrimination by business establishments.
c. The act protects everyone from discrimination in public housing accommodations.
d. The act removes protections from some of the federally protected classes.
870) Which one of these classes is protected under California fair housing law?
a. Convicts
b. Drug addicts
c. Smokers
d. Source of income
871) What is the purpose of the fair lending notice?
a. To disclose the demographic characteristics of approved mortgagors by the bank over the past five years.
b. To explain that financial institutions have the right to refuse to provide loans on homes in neighborhoods with historically high rates of foreclosure.
c. To notify mortgagors of their rights to equitable interest rates.
d. To notify mortgagors that it is illegal for financial institutions to discriminate on the basis of a protected class or on the basis of the characteristics of the neighborhood.
872) The ______ Civil Rights Act protects consumers of businesses from discrimination.
a. American
b. California
c. Unruh
d. U.S.
873) The Unruh Civil Rights Act prohibits discrimination against protected classes by ______ establishments.
a. All business
b. All for-profit
c. Only non-profit
d. Only real estate
874) Which of these actions are exempt from California’s Fair Employment and Housing Act?
a. A man posts a classified ad stating he is looking for a male roommate to share his two-bedroom, one-bath apartment.
b. An apartment manager assigns minorities to one building.
c. An apartment manager refuses to allow an assistance animal in a building with a “no pets” policy.
d. A woman advertises her single-family residence for lease, and says, “No minorities allowed.”
875) Identify the action that is illegal under California’s FEHA.
a. A lender refuses to make loans to someone with a recent bankruptcy.
b. A local city council decides to re-zone a neighborhood from residential to commercial to prevent a housing development aimed at families who receive housing assistance.
c. Jessup, an apartment manager, refuses to permit waterbeds in any building units.
d. Sheila refuses to rent to tenants with poor credit history.
876) To make a complaint with the Department of Fair Employment and Housing, the complainant must first complete what form?
a. Formal DFEH complaint form
b. Pre-complaint inquiry
c. Protected class disclosure form
d. Request for temporary restraining order
877) Which of these actions is a violation of California’s Fair Employment and Housing Act?
a. An apartment manager favors better-looking female applicants over equally qualified plain Janes.
b. An apartment manager screens out a tenant whose source of income is illegal drugs.
c. Kirby, a buyer’s agent, carefully shows Democratic clients only neighborhoods that match their demographics.
d. While presenting offers to a seller client, an agent notes at the top of a summary sheet that the buyer is an “EXOTIC DANCER” and suggests that they look for someone with a more tasteful source of income.
878) Which act prohibits housing financial discrimination on the basis of protected class make-up or location of a property?
a. The DFEH Act
b. The Holden Act
c. The HUD Act
d. The Unruh Act
879) Which of these classes may not be protected outside of California?
a. Disability status
b. Gender expression
c. Race
d. Sex
880) The California Supreme Court has held that protections under the Unruh Act are ______.
a. Applicable to anyone exhibiting characteristics of the protected groups named in the act
b. Restricted to the protected groups named in the act
c. Set to expire in 2016
d. Unconstitutional
881) The ______ has held that protections under the Unruh Act are applicable to anyone exhibiting characteristics of the protected groups named in the act.
a. California Department of Real Estate
b. California Supreme Court
c. FDCA
d. FEMA
882) When a Department of Fair Employment and Housing complaint reaches litigation, the parties have the option to have the case heard before _____________________.
a. A court-appointed mediator
b. Civil court
c. The Department of Fair Employment and Housing or in civil court
d. The Housing and Urban Development Commission
883) Which of these statements about the Unruh Civil Rights Act is true?
a. The act provides for a variety of remedies, including court-ordered damages up to five times the victim’s actual damages.
b. The act provides for a variety of remedies, including court-ordered damages up to three times the victim’s actual damages.
c. The act provides for a variety of remedies, including court-ordered damages up to two times the victim’s actual damages.
d. The act specifies that victims of discrimination may not be reimbursed for attorney fees.
884) Which act provides similar protections for consumers of business services and products as those provided by the California Fair Employment and Housing Act?
a. ADA
b. Federal Fair Housing Act
c. Foreign Investment Act
d. Unruh Act
885) Which step of the DFEH complaint process takes place in civil court?
a. Investigation
b. Litigation
c. Pursuit of resolution
d. Remedies
886) Which of these statements is true?
a. The Unruh Civil Rights Act does not include the seven federally protected classes.
b. The Unruh Civil Rights Act extends protections to several classes in addition to the seven federally protected classes.
c. The Unruh Civil Rights Act protects one class—source of income—in addition to the seven federally protected classes.
d. The Unruh Civil Rights Act protects the seven federally protected classes and no other classes.
887) During which step of the DFEH complaint process does the DFEH explore options to resolve a complaint after a violation of the law has been found?
a. Investigation
b. Litigation
c. Pursuit of resolution
d. Remedies
888) The Unruh Civil Rights Act requires: “Full and equal accommodations, advantages, facilities, privileges or services in ______ business establishments.”
a. All
b. For-profit
c. Non-profit
d. Privately owned
889) Which of these statements accurately describes the formal DFEH complaint process?
a. A formal complaint is only filed if a full investigation reveals a violation of the law.
b. DFEH cases are litigated by private lawyers.
c. The formal process begins with filing of a complaint and ends with remedies. In the middle, you have investigation, pursuit of resolution, and litigation.
d. The process begins with mediation in an effort to avoid a costly investigation.
890) Which of these actions would be considered illegal under the Holden Act?
a. Refusing to provide a mortgage loan to a customer who wishes to buy a home in a neighborhood with a high rate of foreclosures
b. Refusing to provide a mortgage loan to a recently divorced woman who just filed bankruptcy
c. Requiring a legal address for the property before approving a mortgage loan
d. Running a credit report on a mortgage applicant who has darker skin
891) How does the Department of Fair Employment and Housing complaint process begin?
a. A pre-complaint questionnaire is completed by the complainant’s lawyer.
b. Complainants fill out a pre-complaint inquiry form and then are contacted by the DFEH to arrange a telephone interview to gather more information.
c. Complainants fill out formal complaint forms on the DFEH website.
d. Someone who has a complaint calls the DFEH to schedule an interview. If the interviewer deems the complaint to be valid, they give the complainant a questionnaire to fill out.
892) Identify the action that is illegal under California fair housing laws.
a. A landlord gives a tenant notice to vacate after she notices the tenant, a man, has begun dressing as a woman.
b. Brenda, a licensee, is learning Spanish to better converse with her Spanish-speaking clients.
c. Manny, a landlord, refuses to rent to motorcycle riders.
d. Tess, who owns a rental, refuses to allow waterbeds because of their weight.
893) Which term refers to the tenant’s right to live in a rental property without harassment or trespass by the landlord?
a. The right of quiet enjoyment
b. The right to live
c. The right to peace
d. The right to possession
894) Lorenzo just received a prestigious fellowship to study abroad for a year! However, he still has six months left on his one-year apartment lease. His landlord has given him permission to draw up a new agreement with his sister Maggie, whereby Maggie will live in the apartment, pay rent to Lorenzo, and then Lorenzo will pay the landlord. This is an example of ______.
a. Assignment
b. Assimilation
c. Subleasing
d. Transfer
895) Malcolm loves his apartment, even though he’s rarely there. His job in international development has him on the road for months at a time. He doesn’t have to worry about missing out on his lease renewal, though, because he has ______.
a. A freehold estate
b. An estate at will
c. An estate for years
d. A periodic estate
896) What type of leasehold is characterized by possession of a property without the express permission of the property owner, such as a situation in which a tenant continues to occupy an apartment after the lease has terminated?
a. Estate at sufferance
b. Estate at will
c. Freehold estate
d. Periodic estate
897) Selma and Richard have the temporary right to live at 123 Elm Street. They can come and go and use the property as they see fit, but they can’t do so indefinitely. They must vacate the property at the end of next year. What sort of interest do they have in 123 Elm Street?
a. Fee simple estate
b. Leasehold estate
c. Life estate
d. Reversionary estate
898) Randolph has a leasehold estate that automatically renews at the end of each lease period. What type of leasehold estate does Randolph hold?
a. Estate at will
b. Estate for months
c. Periodic estate
d. Renewable estate
899) An example of this type of leasehold estate is a month-to-month lease.
a. Estate at sufferance
b. Estate at will
c. Estate for months
d. Periodic estate
900) Eric’s residential tenant hasn’t paid rent for more than three months, so Eric went to court to start eviction proceedings. He’s now been granted the right to remove the tenant. This is a(n) ______ eviction.
a. Actual
b. Aggressive
c. Constructive
d. Sufferance
901) Dawn owns a bungalow three miles from the city center. She rents it to Bob and Jan Siegel. Dawn is a ______.
a. Beneficiary
b. Lessee
c. Lessor
d. Trustee
902) Cedric is opening a model railroad shop, but he knows that he’ll only run the store until his partner finishes law school. He signed a three-year lease, after which the lease will terminate. What kind of leasehold is this?
a. Estate at sufferance
b. Estate at will
c. Estate for years
d. Periodic estate
903) Lacey is new to California and has found a room to rent on a month-to-month basis until she finds a more permanent place to live. For her lease to be legally binding, it must meet the following minimum criteria:
a. Put in writing and discussed orally
b. Put in writing and notarized
c. Put in writing and signed by a witness
d. Put in writing or discussed orally
904) Which of these terms is used to describe when a new occupant lives in a rental unit and pays rent to the previous tenant, who is still under contract with the landlord?
a. Assignment
b. Covenant
c. Estate at will
d. Sublease
905) Which of these statements about leases in California is true?
a. A lease must identify the parties to the lease and emergency contact information for the tenant.
b. A lease must identify the parties to the lease and the rental property.
c. By default, a residential lease in California has a term of one year.
d. The amount of the rent payment may be decided after the parties have agreed to the lease.
906) Leases with a term of one year or more are required to be in writing according to the California statute of ______.
a. Frauds
b. Landlords and Tenants
c. Leases
d. Limits
907) What’s required for both assignments and subleasing in most cases?
a. An escrow account
b. A real estate license
c. A security deposit
d. Landlord approval
908) Landlords may protect themselves from having to pay for damages to the property caused by the tenant by collecting a security ______ from the tenant.
a. Charge
b. Deposit
c. Guarantee
d. Payment
909) Lorenzo just received a prestigious fellowship to study abroad for a year! However, he’d just signed a one-year lease on his apartment. With the landlord’s permission, he substituted his sister’s name on the lease, and Lorenzo’s sister will pay rent directly to the landlord. Lorenzo may still be liable for the rent if she misses any payments. This is an example of ______.
a. Assignment
b. Assimilation
c. Subleasing
d. Transfer
910) Shannon is moving to California in seven months to attend college and has already signed a nine-month lease agreement. Which of these statements about her lease agreement is true?
a. Her lease does not need to be in writing because California allows oral lease agreements.
b. Her lease does not need to be in writing because the lease term is only for nine months.
c. Her lease needs to be put in writing because California requires that all leases be put in writing, regardless of the term.
d. Her lease needs to be put in writing in because the entire agreement will cover a period of 16 months.
911) Which type of leasehold lasts for a defined period of time and automatically terminates when that period ends?
a. Estate at sufferance
b. Estate at will
c. Estate for years
d. Periodic estate
912) Jake, who was leasing a house, retained possession even after his right to possess had terminated. Jake has a(n) ______.
a. Estate at sufferance
b. Estate at will
c. Estate for months
d. Holdover tenancy
913) Which of these is NOT one of the five required ingredients of a lease in California?
a. Amount of rent and due dates
b. Length of the lease
c. Names of the landlord and tenant
d. Written signatures
914) As part of his lease agreement with his landlord, Alex mows the grass around his apartment building each week in return for a small reduction in rent. What is this an example of?
a. Condition
b. Covenant
c. Enjoyment
d. Promissory
915) Sonya’s lease expired, but she hasn’t yet moved out and she’s not paying rent. Walt has started eviction proceedings. Sonya is considered a(n) ______.
a. Expired tenant
b. Holdover tenant
c. Illegal tenant
d. Malingerer
916) Tyra owns a nail salon that’s located in a strip mall. Her rent every month includes $1,800 base rent and 10% of her gross sales. What kind of lease does Tyra have?
a. Graduated
b. Gross
c. Net
d. Percentage
917) How does the “break-even point” relate to percentage leases?
a. Sales proceeds must exceed last year’s total before the percentage applies.
b. The landlord charges a percentage of the cost for improvements to all tenants.
c. The landlord doesn’t charge a percentage of sales until the tenant’s sales exceed a break-even point.
d. The landlord must receive enough in rent plus the share of sales to break even on the debt service.
918) Martin is a tenant. His lease has a fixed rent but also requires that he pay for insurance and other expenses for the property. What type of lease does he have?
a. Gross
b. Ground
c. Net
d. Variable
919) Which clause allows a landlord to increase the lease payment during the lease term?
a. Acceleration
b. Escalation
c. Mid-lease
d. Upward
920) Gary leases a commercial building and pays all expenses related to the building, including taxes and insurance. Gary has a ______.
a. Gross lease
b. Net lease
c. Percentage lease
d. Sublease
921) How is the break-even point calculated for a percentage lease?
a. Divide the annual expenses by the monthly base rent.
b. Divide the monthly base rent by the percentage the landlord established.
c. Multiply the established percentage by the base rent.
d. Subtract the base rent from the monthly expenses.
922) Which type of lease is one in which the tenant pays the rent and some expenses related to the property (e.g., maintenance) separately?
a. Graduated
b. Gross
c. Net
d. Percentage
923) What’s an expense stop as used in leases?
a. A lease that increases its rate when operating expenses exceed a certain threshold
b. A limit to a landlord’s maintenance costs
c. A way of computing capitalization rates for lease agreements
d. A way to limit taxes on income-producing properties
924) Commercial lease escalation clauses typically do not take effect until after what period of time?
a. Five years
b. One week
c. Six months
d. The “base year,” or first year
925) Charlie, who owns and leases out a commercial building, pays taxes, maintenance, and insurance on the building. What type of lease agreement does Charlie have with his tenants?
a. Gross
b. Net
c. Percentage
d. Triple net
926) How does the term “break-even point” relate to percentage leases?
a. Sales proceeds must exceed last year’s total before the percentage applies.
b. The landlord doesn’t charge a percentage of sales until the tenant’s sales exceed a break-even point.
c. The landlord must receive enough in rent plus the share of sales to break even on the debt service.
d. The tenant has to break even on expenses before the percentage charge is applied.
927) A commercial landlord finds herself in trouble because the rent she is collecting is not keeping up with inflation due to the type of leases she signed with her tenants. She has the longest tenancies of commercial landlords she knows, which is probably because she signed with them ______ leases.
a. Cheap
b. Flat rate
c. Indexed
d. Low rate
928) Brittany has a small office in a professional building. She has a set monthly lease payment that has been calculated to include maintenance of the common areas in the building, such as the restroom and small kitchen, and all nets, utilities, and janitorial charges for her space. The payment also includes taxes and insurance. The landlord takes these payments and pays the individual expenses himself. What type of lease does Brittany have?
a. Graduated lease
b. Gross lease
c. Net lease
d. Percentage lease
929) Which of these types of tenants most often uses a percentage lease?
a. Manufacturing
b. Residential
c. Retail
d. Triple net
930) Headhunters Anonymous rents office space in a large office building owned by CEO Properties. CEO Properties pays all expenses for the property, including taxes, insurance, and routine maintenance. What type of commercial lease does Headhunters Anonymous have?
a. Gross lease
b. Net lease
c. Office space lease
d. Percentage lease
931) Raymond just started his clothing business in a high-traffic shopping center. This type of lease agreement will require Raymond to pay the landlord rent based upon the percentage of the periodic gross sales. This type of agreement is called a ______ lease agreement.
a. Gross
b. Ground
c. Net
d. Percentage
932) With a triple net lease, the tenant pays ______ separately from the base rent.
a. Insurance, utilities, and maintenance
b. Maintenance, insurance, and debt service
c. Taxes, debt service, and lease payment
d. Taxes, insurance, and maintenance
933) What type of a lease escalation clause is tied to a market index (typically the CPI)?
a. A flat rate lease escalation clause
b. An expense lease escalation clause
c. An index lease escalation clause
d. A profit margin lease escalation clause
934) Fiona signed a lease with her landlord for a commercial building. A percentage of Fiona’s sales will be paid to the landlord, in addition to her lease payment. Why would Fiona agree to this arrangement?
a. Fiona is hoping to purchase the building at a later date.
b. Fiona wants to demonstrate how viable her business is.
c. Fiona wants to reduce her base rent.
d. The landlord is her business partner.
935) You have a client who is leasing commercial space. The lease terms call for him to pay a portion of the landlord’s taxes, insurance, and maintenance. What type of lease does your client have?
a. Itemized lease
b. Percentage lease
c. Sublease
d. Triple net lease
936) Maxwell is a tenant. His lease has a fixed rent in which the landlord pays all taxes, insurance, and maintenance expenses. What type of lease does he have?
a. Gross
b. Ground
c. Net
d. Variable
937) One of the requirements of an enforceable lease is that both parties are bound to the terms of the lease. This is called ______.
a. Mutuality of assent
b. Mutuality of enforceability
c. Mutuality of liability
d. Mutuality of obligation
938) Which term describes the transfer of possession of rental property?
a. Clairvoyance
b. Contract
c. Conveyance
d. Covenant
939) Which of these terms refers to the mutual agreement between the landlord and the tenant?
a. Lawful object
b. Legal capacity
c. Mutual assent
d. Mutuality of obligation
940) This legal aspect of a lease establishes “privity of contract.”
a. Contract
b. Conveyance
c. Covenant
d. Statute of Frauds
941) Which of these statements about leases is true?
a. A lease must be signed by a notary and recorded in public records to be enforceable.
b. A lease must meet the essential requirements of any contract to be enforceable.
c. A lease that is not signed is not enforceable.
d. A tenant may waive the right to peaceful enjoyment if the lease includes an unlimited right-of-entry covenant.
942) Which terms describes a lease that has been agreed to by both parties?
a. Accepted
b. Delivered
c. Effective
d. Executed
943) Which of these two terms describe the dual legal nature of a lease?
a. Clairvoyance and contract
b. Concession and contract
c. Conveyance and concession
d. Conveyance and contract
944) Which of these statements about recording a lease is true?
a. A lease must be recorded to be legally enforceable.
b. A tenant who lives in a building that is being sold may want to have the lease filed as a public record.
c. Landlords in California are obligated to record leases with public records.
d. Leases may only be recorded with the consent of the landlord.
945) When a landlord grants possession of a property to a tenant, this is called an act of what?
a. Clairvoyance
b. Contract
c. Conveyance
d. Ownership
946) –
947) Which of these contract-specific requirements for a lease prohibits minors from entering into a lease agreement?
a. Lawful object
b. Legal capacity
c. Mutual assent
d. Mutuality of obligation
948) This legal aspect of a lease establishes “privity of estate.”
a. Clairvoyance
b. Contract
c. Conveyance
d. Ownership
949) When presenting a CMA, if you take the time to explain the CMA process, help the prospective sellers understand what’s behind the numbers, and ultimately leave the decision of the list price up to them, what characteristic have you demonstrated?
a. Documentation
b. Effective communication
c. Law-abiding
d. Precision
950) You are working on a CMA for your new listing. The seller has indicated that he really wants to list his home for $400,000 or more. Which of the following would indicate that price may be too high?
a. The closest comparable is a two-story while your client’s house is a ranch house.
b. There are no comparables within the last six months.
c. There were three expired listings priced between $400,000 and $425,000.
d. Two properties recently sold for just under $400,000.
951) Which of the following statements is true about appraisals?
a. “Appraisal” and “CMA” are interchangeable terms for a property valuation.
b. Appraisals may only be performed by certified appraisers (with certain exceptions in some states).
c. Either certified appraisers or managing brokers may perform appraisals.
d. Real estate licensees may perform appraisals on foreclosed properties, but a certified appraiser must perform all other appraisals.
952) Clark works for Acme Bank and asks for your assistance. He wants you to look at a property that’s about to go into foreclosure and provide him with a report on its current marketability and an approximate market value. What’s Clark most likely asking you to provide?
a. Appraisal
b. BPO
c. CMA
d. Professional opinion
953) Which type of listing can help a real estate professional determine how quickly a home in a given price range received an accepted offer?
a. Expired
b. Foreclosed
c. Pending
d. Withdrawn
954) When pricing a property, which of the following is a reason a licensee would consider expired listings?
a. To determine approximately how long it will take the home to sell
b. To determine the price at which a property is most likely to sell
c. To determine the price at which a property won’t sell
d. To determine the property’s competition
955) Marcy’s offer on a home was accepted! Which party will be contacting her about arranging an appraisal?
a. The closing attorney
b. The lender
c. The seller’s agent
d. The title insurance representative
956) What does a CMA determine?
a. Availability of funding
b. Cost of replacement
c. Cost per square foot
d. Market price range
957) When a real estate professional goes beyond a broad brushstroke approach to a CMA and takes the time to research not only recent sales, but competition and expired listings, what trait are they exhibiting?
a. Diligence
b. Documentation
c. Effective communication
d. Empathy
958) Ellen has only been licensed for two weeks, but she’s already toured the home of potential clients, the Birds. What should she do to next to secure the listing?
a. Call her mom and get a pep talk.
b. Prepare a CMA.
c. Print out two copies of her professional resume.
d. Review her pre-licensing coursework for information about taking property photos.
959) When completing a CMA, what might be indicated if a comparable property had a quick sale?
a. It’s a buyer’s market.
b. The market for similar homes is good.
c. The other agent was incompetent.
d. The property was priced too high.
960) Real estate licensees turn to specific information sources when preparing CMAs for clients. Which of the following information sources is best for estimating the market value of a property?
a. Comparable sales
b. Construction costs
c. Previous sales price
d. Time to close
961) In which form of price determination does the real estate professional often just drive by the property and take photos, then complete paperwork for the lender?
a. Appraisal
b. Broker’s price opinion
c. Comparative market analysis
d. Competitive market analysis
962) Which type of analysis is a broad estimate of price in case the lender must take over the property and sell it to an investor or on the market?
a. Appraisal
b. Broker’s price opinion
c. Comparative market analysis
d. Credit analysis
963) Which of the following features is most likely to be the cause of an adjustment to a comparable when preparing a CMA?
a. Busy street
b. Color
c. Demographics
d. Interest rates
964) Which of the following provides an opinion of list price range by looking at recently sold properties, comparing current competing properties and properties that didn’t sell, and estimating buyer appeal regarding the style, location, and size?
a. Appraisal
b. Broker price opinion
c. Collective market analysis
d. Comparative market analysis
965) What’s the primary purpose of a CMA?
a. To determine an appropriate listing price range
b. To ensure that the sales price reflects the cost of replacement
c. To provide the property value to the lender
d. To set a price that an appraiser will approve
966) You need to perform a sales comparison for your clients. Comparable A’s adjusted sales price is $277,000. Comparable B’s adjusted sales price is $255,000. How might you use this data to determine a list price range for the clients’ home?
a. Find the average of the adjusted sales prices of Comparable A and Comparable B.
b. Give more weight to the list price on Comparable A, because it’s lower.
c. Give more weight to the list price on Comparable B, because the subject property will likely sell more quickly at this higher price.
d. Give more weight to the list price on the comparable that’s most similar to the property.
967) Steve is preparing a comparative market analysis for the Joneses and has selected three comparable properties. How many adjustments should Steve make to the Joneses’ property?
a. One
b. Three
c. Two
d. Zero
968) Steve won’t adjust the subject property. Only the comparable’s sales price is adjusted. If it is inferior, adjust upward. If it’s superior, adjust downward.
969) Question 4
970) Which of the following is typically used for purposes other than a prospective listing or sale?
a. Appraisal
b. AVM
c. BPO
d. CMA
971) Jan is a real estate licensee gathering information to help her seller determine a good listing price. How could expired listings help her in this process?
a. They denote the property’s competition.
b. They determine approximately how long it will take the property to sell.
c. They help determine the price at which the property is most likely to sell.
d. They illustrate the price at which the property won’t sell.
972) When licensees follow through on what prospects have asked, arrive for meetings on time, and come prepared, what trait are they exhibiting?
a. Competence
b. Documentation
c. Effective communication
d. Empathy
973) Comparative market analysis is most effective when a licensee limits the data collection time frame for sold properties. A CMA should look at properties that sold within ______.
a. In the last two years
b. No later than three to six months ago
c. Within 18 to 24 months
d. Within the last six to 12 months
974) Which type of analysis starts with a visit to the property, a search on the MLS, and a comparison of comparable sales, and hopefully ends in a listing for a real estate licensee?
a. Appraisal
b. Broker price opinion
c. Comparative market analysis
d. Credit analysis
975) Supply and demand determine competition within a market. Which of the following is a true statement?
a. When there are fewer houses on the market, buyers will pay less.
b. When there are fewer houses on the market, demand wanes, as well.
c. When there are fewer houses on the market, neighborhood blight occurs.
d. When there are fewer houses on the market, sellers can demand more for their properties.
976) When you’re putting together a listing presentation, which of these is a key point to address?
a. Buyers won’t pay more for a home than the market dictates.
b. Everything you talk about with the seller will change in six months.
c. The house needs work before you can sell it for the right price.
d. Your credentials are the best in the market.
977) After you’ve made a professional listing presentation and the seller has declined to use you as a listing agent, what’s the best practice?
a. You should accept the outcome either way.
b. You should ask the sellers for a second chance.
c. You should call the competing salespersons to discuss the matter.
d. You should pursue the sellers with questions about their decision, even if they tell you they don’t want to talk about it.
978) Getting the best price is always a factor for a seller, but the ______ at which it would actually sell must be another consideration.
a. Guesstimate
b. Highest possible price
c. Market price
d. Reduced price
979) If, after seeing your carefully prepared comparative market analysis, a seller doesn’t agree with the price range you prepared in your listing presentation, your best practice would be to ______.
a. Decline the listing if the seller’s price and your price analysis are too far apart.
b. List the property at the seller’s price and hope to reduce the price later.
c. Offer to purchase the property at your suggested list price if it doesn’t sell at the seller’s price.
d. Split the difference.
980) What happens when an appraiser determines a property’s value to be less than the pre-approved loan amount?
a. Most buyers will have an appraisal contingency, so they can back out and receive a refund of their earnest money.
b. Most sellers will have an appraisal contingency, so the seller can keep the buyer’s earnest money.
c. The buyer must make up the difference between the appraisal and the purchase price.
d. The seller must make up the difference between the appraisal and the purchase price.
981) Why is it so important to properly price a property when it first enters the market?
a. If a property is overpriced from the beginning, the chances of the property selling are not impacted significantly.
b. Overpricing a property will drive up the price of other properties as well, causing a false inflation.
c. The first several months are crucial because they’re the best chance for the property to sell.
d. The first several weeks are crucial because they’re the best chance for the property to sell.
982) What are some ways you can make sure you’re pricing a property at fair market value?
a. Ask the sellers what the sales price should be.
b. List to sell as fast as possible.
c. Prepare a well-researched CMA.
d. Price it at the price the house originally sold for to be fair.
983) An agent lists a home that receives an offer for full list price within one day in a buyers’ market. There is a chance the agent ______ the home.
a. Appraised
b. Inflated
c. Overpriced
d. Underpriced
984) What’s a CMA?
a. Company marketing announcement
b. Comparative market analysis
c. Comparison marketing algorithm
d. Comprehensive market appraisal
985) What’s the best advice when challenging an appraisal?
a. Be specific and concise about why the value opinion is different in your mind.
b. Blame it on the appraiser.
c. Don’t bother asking the appraiser to explain why certain adjustments were made or not made.
d. Suggest a minimum value for the appraiser to meet.
986) Many market conditions impact housing prices. Which of the following is a true statement?
a. High unemployment rates mean there are more available buyers in the market.
b. Inflation increases buying power.
c. Low unemployment rates mean there are fewer available buyers in the market.
d. Reduced consumer confidence makes new buyers wary of purchasing and homeowners hesitant to trade up.
987) A property has been listed on the market for four months with no offers. Finally, a buyer makes an offer that is 18% less than the list price. How was this property likely priced when it first hit the market?
a. At appraisal value
b. Fair market value
c. Overpriced
d. Underpriced
988) Demographics impact the housing market. Which of the following is a true statement?
a. An increase in the number of retirees in a given population would negatively impact the demand for large, single-family homes.
b. An increase in the number of retirees in a given population would positively impact the demand for large, single-family homes.
c. An influx of higher wage earners to a given area would create a price decrease for lower-valued homes.
d. An influx of higher wage earners to a given area would decrease the demand for higher-priced housing.
989) Why might a licensee want to make two visits to the property as part of a listing presentation?
a. To find out how many licensees the seller will be interviewing, which will help determine how much effort to put into preparing a comparative market analysis
b. To see if the sellers say the same thing both times
c. To see the property at different times of day
d. To use information from a tour to prepare the CMA
990) When market conditions indicate top-of-the-market pricing, is it always in your client’s best interest to price it there?
a. No, because higher sales prices result in higher taxes.
b. No, it still has to appraise.
c. Yes, because it’s probably what will win the listing for you.
d. Yes, because it will sell fast.
991) Which of the following is a potential consequence of overpricing a property?
a. A competing broker can report you for unfairly pricing a property.
b. It increases the odds that buyers will be interested because it must be worth the higher price point.
c. The property will receive offers from serious buyers only, since it is listed at a higher price point.
d. The property won’t appraise high enough and you could lose the contract if you do get an offer.
992) When pricing a home for the market, what should a licensee try to get sellers to do?
a. Put themselves in the buyers’ shoes
b. See how much it might be able to fetch on the market
c. Set the price at one level, with the expectation of lowering it in 30 days
d. Visit the neighbors and come up with a price
993) An agent has a seller who wants to list the property at $550,000. The market has taken a downturn, and the fair market value is estimated at $495,000. What is the best approach for this listing?
a. Explain the benefits in the long run of entering the market at a fair price.
b. List the home at $550,000 to keep the seller happy.
c. Tell the seller it’s worth a shot to try it and see if you can get more.
d. Tell the seller that you won’t work with her unless she lists the home at $495,000.
994) Which of the following statements is true about the listing presentation?
a. It’s best to leave out financial data (such as a CMA or comparable property information) and listing agreements, so the seller doesn’t think you’re jumping the gun and already counting your commission.
b. The less you say, the better. You don’t want to overwhelm your potential clients with numbers and decisions at this first presentation.
c. The most important part of a listing presentation is to make the buyers like you as a person. Try not to talk numbers or about their house, but instead focus on charming them.
d. You should go into the presentation fully prepared with a comparative market analysis, listing agreement, MLS listings of comparable properties, and your plan for marketing the sellers’ property.
995) If an appraisal is lower than the agreed-upon sales price, what steps can the seller take?
a. A second appraisal can be ordered, although there should be good reason to question the first appraisal.
b. A second appraisal can be ordered, but it’s always the buyer’s expense.
c. A second appraisal can be ordered, but the seller must pay for it.
d. A second appraisal can be ordered, which typically turns out to be higher.
996) Claire, a seller, accepted an offer on her home. However, it just appraised for less than the sales price. Which of the following is true?
a. Claire must refund the buyers for the cost of the appraisal.
b. Claire must take her house off the market.
c. The appraiser must perform a second appraisal.
d. The lender will only approve a loan based on the property’s appraised value.
997) A home enters the market priced above fair market value. Within the same time frame, three additional homes enter the market listed between 5% and 10% less than the first home, at a fair market price. What is likely to happen with the first home?
a. Buyers will recognize the higher price point and immediately submit much lower offers.
b. If a property is overpriced from the beginning, buyers will move on and likely make a purchasing decision before the price is corrected on the overpriced home.
c. The backload of buyers on the market will wait to see if the price is adjusted on the first home.
d. The chances are high there are one or two buyers in the backload of buyers who are willing to make an offer at the entry price.
998) Interest rates determine buying power. Which of the following is a true statement?
a. When interest rates are high, buyers are often priced out of the market.
b. When interest rates are high, buyers will be able to afford higher-priced homes.
c. When interest rates climb, more buyers are encouraged to buy.
d. When interest rates shift higher, buyers can still buy in the same price range.
999) When a property is overpriced, what happens?
a. A backlog of buyers will return to it again and again.
b. It can usually list again at a higher price.
c. It increases buyer interest and demand.
d. It may become stale on the market, resulting in low-ball offers.
1000) An agent is working with seller clients who are very emotionally attached to their home. They want to list the property at $330,000, but the CMA indicates a price range of $255,000 to $275,000. What is the best course of action?
a. Explain the importance of fair market value and offer to walk them through the process.
b. List the home for $300,000 because it’s a good compromise.
c. List the home to sell, so start with the lower end of the CMA.
d. Start with listing for $330,000 and see if you get any interest.
1001) What’s the best strategy for pricing a home?
a. Always go with what the seller thinks it’s worth—the customer is always right.
b. Prepare a detailed comparative market analysis and base the price on recent comparable sales.
c. Price it higher than market value so buyers think it has more to offer and will schedule a showing.
d. Price it lower than market value so that there are lots of offers and a bidding war.
1002) At a listing appointment, licensee Chet asks Sam, the seller, if his property is his own home or an investment property. Why would Chet ask this?
a. Chet can only represent sellers if they’re selling their own home; selling investment properties requires a different license.
b. If the home is his own, he’s likely to be purchasing a new one, so Chet has a chance to land two transactions.
c. Investment homes are easier to sell because they’re sold “as-is.”
d. Investment home sellers tend to be more emotionally attached because the homes bring them more income.
1003) A fire destroyed Meredith’s house. Meredith contacted her insurance company, and she was shocked to learn her insurance policy didn’t fully cover what she paid for the property. How does the insurance company determine the replacement value of her home?
a. Its current market value
b. The amount for which it was appraised
c. The amount it would cost to completely replace her home
d. The original sales price when it was first constructed
1004) Which of these terms can be defined as what a buyer has paid for a property and what the seller has accepted?
a. Appraisal
b. Cost
c. Price
d. Value
1005) Who typically performs an appraisal?
a. Certified appraiser
b. Inspector
c. Real estate licensee
d. Tax assessor
1006) Which economic principle is related to supply and demand?
a. Competition
b. Conformity
c. Contribution
d. Substitution
1007) A rundown home, overgrown with weeds and in desperate need of repairs, is driving down property values on the block. What economic principle is at work here?
a. Anticipation
b. Contribution
c. Progression
d. Regression
1008) The economic principle that tells us that when supply goes up, price goes down is also called ______.
a. Conformity
b. Price dropping
c. Regression
d. Supply and demand
1009) –
1010) The Hendersons were hoping to list their home for $400,000; however, four other comparable homes in the neighborhood just went up for sale, and they now must list their property at $380,000 to sell quickly. Which economic principle is at work here?
a. Competition
b. Conformity
c. Progression
d. Substitution
1011) Boris is an appraiser working for the Smith family. They’ve hired him to perform an appraisal on their six-bedroom house. What two types of data will Boris gather?
a. Digital and hand-written
b. General and specific
c. Old and recent
d. Pertinent and unrelated
1012) What acronym can be used to remember factors that influence real property value?
a. CRUD
b. DUST
c. GIVEN
d. OLD CAR
1013) What type of value may consumers be interested in if they are looking for the potential rate of return?
a. Assessed value
b. Insured value
c. Investment value
d. Value in use
1014) Appraiser Jamie is looking past how a property is being used to determine a higher value. What is Jamie determining?
a. Cost to replace
b. Highest and best use
c. Loan value
d. Value in use
1015) What’s another term for a valuation that’s an unbiased opinion of value?
a. Assessment
b. Comparative market analysis
c. Evaluation
d. Formal appraisal
1016) When appraisers look past how a property is being used to determine a more optimal function, what are they determining?
a. Cost to replace
b. Highest and best use
c. Market value
d. Value in use
1017) Which of the following is the cost of replacing a building in the case of total loss?
a. Insured value
b. Investment value
c. Mortgage value
d. Value in use
1018) Which of the following is defined as what it would take to recreate a property if it disappeared off the face of the earth today?
a. Cost
b. Insurance
c. Price
d. Value
1019) A CMA or a BPO is an example of ______.
a. A formal appraisal
b. An assessment
c. An informal estimate of market value
d. An inspection
1020) What is an appraisal?
a. A determination of property defects and conditions
b. An opinion of listing price as determined by a real estate professional
c. An opinion or estimate of a property’s value as of a specific date
d. A study on the feasibility of developing land
1021) When prices go down because there are too many homes on the market and too few buyers, what economic principle is at work?
a. Competition
b. Conformity
c. Progression
d. Regression
1022) Which factor influences property value and addresses questions such as, “What’s the market like?” and “Are there more buyers than sellers, or vice versa?”
a. Demand
b. Scarcity
c. Transferability
d. Utility
1023) Marcus bought two adjoining pieces of land that were zoned for commercial use. When he realized that combining the two parcels would dramatically increase the land’s value, he jumped at the opportunity. What’s this an example of?
a. Contribution
b. Eminent domain
c. Plottage
d. Zoning
1024) Building codes, zoning laws, and environmental legislation are examples of which force that influences property value?
a. Economic
b. Physical/environmental
c. Political/governmental
d. Social
1025) Which economic principle pertains to how a change in a property affects its value as a whole?
a. Anticipation
b. Conformity
c. Contribution
d. Substitution
1026) Appraiser John is determining how a property is being used to determine a more optimal function. What is he determining?
a. Cost to replace
b. Highest and best use
c. Mortgage value
d. Value in use
1027) Which of the following terms means the price a property is worth to its owner as currently enjoyed?
a. Appraisal
b. Insured value
c. Investment value
d. Value in use
1028) Kevin is having an appraisal performed on a piece of property he’s interested in buying. He’s especially interested in hearing about the estimated rate of return the property could pull. What type of value is he interested in?
a. Assessed value
b. Insured value
c. Investment value
d. Value in use
1029) A property’s value is dropping because the neighboring property’s yard is filled with trash. What’s this an example of?
a. Depreciation
b. Progression
c. Regression
d. Substitution
1030) Appraiser Jerry is looking past how a property is being used to determine a more optimal function. What is he determining?
a. Cost to replace
b. Highest and best use
c. Market value
d. Value in use
1031) What’s the first step an appraiser will perform when conducting an appraisal?
a. Estimate the value of the land.
b. Gather and analyze data.
c. Identify the data that’s needed.
d. State the problem.
1032) The Richards family farm is located on a 10-acre parcel of land, which is very rare in their area. However, the house is rundown and in need of many repairs. Most buyers in the area are looking for a move-in-ready home, which means they would need to either look elsewhere or wait several months for the home to be renovated. Which factor is most negatively impacting the value of the Richards’ property?
a. Demand
b. Scarcity
c. Transferability
d. Utility
1033) Which of the following is a piece of general data an appraiser may gather?
a. Improvements made to a property
b. Kitchen upgrades
c. Population size
d. Property lot size
1034) Your neighbors build a high-quality addition to their home, increasing its value compared to your own home’s value. Because of this, you notice a bump in your property value. Which economic principle is at work here?
a. Conditional value
b. Price bump
c. Progression
d. Regression
1035) Which of the following can be defined as what a property is worth?
a. Appraisal
b. Cost
c. Price
d. Value
1036) What’s one purpose of a BPO?
a. To assist buyers in determining an offer amount or sellers in determining a listing price
b. To assist insurers in determining the amount of liability insurance to place on a property
c. To assist lenders in determining the marketability and potential sales price for distressed properties
d. To ensure that the value of a property is sufficient as collateral for a mortgage loan
1037) What’s the price at which a willing buyer and a willing seller would strike a deal given normal market conditions?
a. Insured value
b. Market value
c. Valuation
d. Value in use
1038) Which of these principles of value is related to how a change to a portion of a property impacts the value as a whole?
a. Contribution
b. Impact on value
c. Plottage
d. Progression
1039) What is the term for an increase in property value caused by the joining of two neighboring parcels of land?
a. Anticipation
b. Contribution
c. Plottage
d. Progression
1040) Appraiser Victor is determining the insured value of a property. What is he evaluating?
a. Items of great importance to a lender to replace or rebuild
b. The cost to replace or rebuild a property
c. The price at which the property can be loaned on or sold at a foreclosure sale
d. The return on investment the property may provide
1041) Trudy loved her new neighbors. The investor couple bought every available house on Trudy’s block and was working hard to renovate them and increase their value. Trudy decided that she’d sit back, relax, and let her property’s value go up, too, thanks to ______.
a. Competition
b. Progression
c. Regression
d. Substitution
1042) What type of value is of interest to taxing authorities?
a. Assessed value
b. Insured value
c. Investment value
d. Value in use
1043) Rico is an appraiser who is performing a valuation on a property. What’s another term for what Rico is doing?
a. Analytical exercise
b. CMA
c. Formal appraisal
d. Price opinion
1044) Which economic principle states that the value of property today is impacted by the current value of the total expected future benefits?
a. Anticipation
b. Conformity
c. Highest and best use
d. Progression
1045) Which of these is true about the assessed value of real estate?
a. It is typical for the assessed va