ACEABLE REAL ESTATE FINAL EXAM 2026/2027
QUESTIONS AND SOLUTIONS RATED A+
✔✔constructive notice - ✔✔when a property's ownership is recorded publicly, so
everyone can know the contents of recorded documents
✔✔contingency - ✔✔a provision within a contract that makes performance conditional
upon the occurrence of a stated event
✔✔contract - ✔✔a legally enforceable and binding agreement between parties wherein
a promise to do or not do something is given in exchange for valuable consideration
✔✔contract for deed - ✔✔a sales contract in which the buyer pays the seller for the
property in multiple installments for a predetermined length of time, and the seller holds
the title until the property has been fully paid for; also known as an *installment sales
contract* or *land contract*
✔✔contribution - ✔✔the amount of market value added to a property by an addition or
improvement to the property; not necessarily the same as the cost of the improvement
✔✔conventional life estate - ✔✔is a life estate in which the measuring life is that of the
life tenant; it is an estate created by a deed that lasts for the duration of the tenant's life
✔✔conventional loan - ✔✔any loan that is neither insured by the government nor
guaranteed by the government
✔✔conversion - ✔✔changing real property to personal property, and vice versa; also
the illegal act of mixing a fiduciary's funds with an agent's personal funds
✔✔conveyance - ✔✔an instrument that transfers a grantor's interest in real property
✔✔cooperating brokerage - ✔✔an agency arrangement in which two brokerages
collaborate to achieve a real estate transaction for a specific piece of property.
✔✔corrective maintenance - ✔✔the repair or restoration of equipment after it has
broken
✔✔cost approach - ✔✔method of estimating the value of a property by determining how
much it would cost to replace the building or other improvements, minus the cost of
depreciation, plus the value of the land itself
✔✔counteroffer - ✔✔a contract proposal submitted in response to a previous offer,
modifying the terms of the original offer; considered a rejection of the original offer
,✔✔covenant of seisin - ✔✔a protection in which the grantor states they hold the title
conveyed in the deed, a.k.a. covenant of seizin
✔✔covenants, conditions, and restrictions (CCRs) - ✔✔private restrictions similar to
deed restrictions that dictate what homeowner may do with their property
✔✔credit report - ✔✔contains information regarding an individual's credit history (loan
payments, etc.) as well as the present credit status of all open credit accounts
✔✔credits - ✔✔sum of money that is received
✔✔curtesy/dower - ✔✔the right of a spouse to inherit property held in their spouse's
name after that spouse dies; dower is the word used for women, curtesy for men.
✔✔customer - ✔✔an individual with whom a license holder has no agency relationship
nor fiduciary duties but to whom fairness and honesty are still required
✔✔datum - ✔✔a designated base reference point to elevation used by surveyors to
determine the elevations of land or property in an area
✔✔debits - ✔✔sum of money that is owed
✔✔debt service - ✔✔current debt obligations
✔✔Debt Service Coverage Ratio - ✔✔used to evaluate income-producing properties; is
calculated by dividing the net operating income (cash flow after all expenses and debts
are paid) by total debt service (current debt obligations)
✔✔debt-to-income ratio - ✔✔used to measure a borrower's creditworthiness; calculated
by dividing all debt (monthly payment + other debt) by monthly income
✔✔deed in lieu of foreclosure - ✔✔an alternative to foreclosure in which the defaulting
borrower voluntarily transfers the property title to the lender and the borrower cancels
the foreclosure
✔✔deed In trust - ✔✔a deed used to convey ownership interest to the trustee under a
land trust
✔✔deed restriction - ✔✔a provision in a deed that restricts the land use of a property
✔✔defeasance - ✔✔a clause in a security document that indicates that the loan has
been satisfied and that either the title will be conveyed to the borrower or the lien on the
borrower's title will be removed
, ✔✔deficiency judgment - ✔✔a court's decision to attach a judgement (lien) against a
debtor in the event that a property's sale price does not cover outstanding debts
✔✔demand - ✔✔a measure of the general desire for an asset or commodity at a given
time
✔✔density - ✔✔the measure of the proportion of a given area used for residential
purposes
✔✔Department of Housing and Urban Development (HUD) - ✔✔a department in the
federal government which is in charge of enforcing federal fair housing laws
✔✔depreciation - ✔✔a reduction in value for any reason
✔✔designated agency - ✔✔an agency arrangement wherein both parties to the
transaction are represented by their own agent, but both agents are employed by the
same brokerage; by necessity each client enjoys an agency relationship exclusively with
the named agent within the brokerage
✔✔devise - ✔✔the transfer of real or personal property through a will
✔✔disability or handicap - ✔✔a physical or mental impairment that substantially limits
one or more major life activities, the record of such impairment, or being regarded as
having such an impairment
✔✔discount point - ✔✔a loan fee used to decrease a loan's interest rate
✔✔discrimination - ✔✔the unjust or prejudicial treatment of different categories of
people, especially on the grounds of race, color, sex, national origin, religion, disability,
or other classifications
✔✔disintermediation - ✔✔the process of money flowing out of banks
✔✔doctrine of laches - ✔✔a legal principle used to bar dated claims; used in
conjunction with an unreasonable delay or negligence in asserting or defending one's
rights
✔✔doctrine of prior appropriation - ✔✔doctrine granting a state the power to control and
regulate all water resources within its borders
✔✔Dodd-Frank Act - ✔✔a law passed in response to the subprime mortgage crisis that
created the consumer finance protection bureau.
QUESTIONS AND SOLUTIONS RATED A+
✔✔constructive notice - ✔✔when a property's ownership is recorded publicly, so
everyone can know the contents of recorded documents
✔✔contingency - ✔✔a provision within a contract that makes performance conditional
upon the occurrence of a stated event
✔✔contract - ✔✔a legally enforceable and binding agreement between parties wherein
a promise to do or not do something is given in exchange for valuable consideration
✔✔contract for deed - ✔✔a sales contract in which the buyer pays the seller for the
property in multiple installments for a predetermined length of time, and the seller holds
the title until the property has been fully paid for; also known as an *installment sales
contract* or *land contract*
✔✔contribution - ✔✔the amount of market value added to a property by an addition or
improvement to the property; not necessarily the same as the cost of the improvement
✔✔conventional life estate - ✔✔is a life estate in which the measuring life is that of the
life tenant; it is an estate created by a deed that lasts for the duration of the tenant's life
✔✔conventional loan - ✔✔any loan that is neither insured by the government nor
guaranteed by the government
✔✔conversion - ✔✔changing real property to personal property, and vice versa; also
the illegal act of mixing a fiduciary's funds with an agent's personal funds
✔✔conveyance - ✔✔an instrument that transfers a grantor's interest in real property
✔✔cooperating brokerage - ✔✔an agency arrangement in which two brokerages
collaborate to achieve a real estate transaction for a specific piece of property.
✔✔corrective maintenance - ✔✔the repair or restoration of equipment after it has
broken
✔✔cost approach - ✔✔method of estimating the value of a property by determining how
much it would cost to replace the building or other improvements, minus the cost of
depreciation, plus the value of the land itself
✔✔counteroffer - ✔✔a contract proposal submitted in response to a previous offer,
modifying the terms of the original offer; considered a rejection of the original offer
,✔✔covenant of seisin - ✔✔a protection in which the grantor states they hold the title
conveyed in the deed, a.k.a. covenant of seizin
✔✔covenants, conditions, and restrictions (CCRs) - ✔✔private restrictions similar to
deed restrictions that dictate what homeowner may do with their property
✔✔credit report - ✔✔contains information regarding an individual's credit history (loan
payments, etc.) as well as the present credit status of all open credit accounts
✔✔credits - ✔✔sum of money that is received
✔✔curtesy/dower - ✔✔the right of a spouse to inherit property held in their spouse's
name after that spouse dies; dower is the word used for women, curtesy for men.
✔✔customer - ✔✔an individual with whom a license holder has no agency relationship
nor fiduciary duties but to whom fairness and honesty are still required
✔✔datum - ✔✔a designated base reference point to elevation used by surveyors to
determine the elevations of land or property in an area
✔✔debits - ✔✔sum of money that is owed
✔✔debt service - ✔✔current debt obligations
✔✔Debt Service Coverage Ratio - ✔✔used to evaluate income-producing properties; is
calculated by dividing the net operating income (cash flow after all expenses and debts
are paid) by total debt service (current debt obligations)
✔✔debt-to-income ratio - ✔✔used to measure a borrower's creditworthiness; calculated
by dividing all debt (monthly payment + other debt) by monthly income
✔✔deed in lieu of foreclosure - ✔✔an alternative to foreclosure in which the defaulting
borrower voluntarily transfers the property title to the lender and the borrower cancels
the foreclosure
✔✔deed In trust - ✔✔a deed used to convey ownership interest to the trustee under a
land trust
✔✔deed restriction - ✔✔a provision in a deed that restricts the land use of a property
✔✔defeasance - ✔✔a clause in a security document that indicates that the loan has
been satisfied and that either the title will be conveyed to the borrower or the lien on the
borrower's title will be removed
, ✔✔deficiency judgment - ✔✔a court's decision to attach a judgement (lien) against a
debtor in the event that a property's sale price does not cover outstanding debts
✔✔demand - ✔✔a measure of the general desire for an asset or commodity at a given
time
✔✔density - ✔✔the measure of the proportion of a given area used for residential
purposes
✔✔Department of Housing and Urban Development (HUD) - ✔✔a department in the
federal government which is in charge of enforcing federal fair housing laws
✔✔depreciation - ✔✔a reduction in value for any reason
✔✔designated agency - ✔✔an agency arrangement wherein both parties to the
transaction are represented by their own agent, but both agents are employed by the
same brokerage; by necessity each client enjoys an agency relationship exclusively with
the named agent within the brokerage
✔✔devise - ✔✔the transfer of real or personal property through a will
✔✔disability or handicap - ✔✔a physical or mental impairment that substantially limits
one or more major life activities, the record of such impairment, or being regarded as
having such an impairment
✔✔discount point - ✔✔a loan fee used to decrease a loan's interest rate
✔✔discrimination - ✔✔the unjust or prejudicial treatment of different categories of
people, especially on the grounds of race, color, sex, national origin, religion, disability,
or other classifications
✔✔disintermediation - ✔✔the process of money flowing out of banks
✔✔doctrine of laches - ✔✔a legal principle used to bar dated claims; used in
conjunction with an unreasonable delay or negligence in asserting or defending one's
rights
✔✔doctrine of prior appropriation - ✔✔doctrine granting a state the power to control and
regulate all water resources within its borders
✔✔Dodd-Frank Act - ✔✔a law passed in response to the subprime mortgage crisis that
created the consumer finance protection bureau.
