MA REAL ESTATE EXAM STUDY GUIDE UPDATED ACTUAL QUESTIONS AND CORRECT ANSWERS

MA REAL ESTATE EXAM STUDY GUIDE UPDATED
ACTUAL QUESTIONS AND CORRECT ANSWERS

Question:
1. Appraisal
Answer:
An estimation of a property's value, usually prepared by a professional who is licensed in this field.

Question:
2. Brokerage
Answer:
The business of bringing people together in a real estate transaction.

Question:
3. Commerical
Answer:
The types of properties that include office spaces, shopping centers, stores, theaters, hotels, parking
facilities, etc.

Question:
4. Development
Answer:
The term for the construction of improvements upon the land.

Question:
5. Elevation Certificate
Answer:
Insurance agents are required to obtain one of these on any property before issuing quotes for flood
insurance.

Question:
6. Financing
Answer:
The pledging of real property and collateral for the repayment of a loan through a mortgage or deed of
trust.

Question:
7. Federal Deposit Insurance Corporation
Answer:
This agency can fine and withdraw its insurance from lenders that do not carry flood insurance on required
mortgages.

Question:
8. Flood Insurance

,Answer:
This type of homeowner's insurance policy covers "rising water" problems such as a burst water main,
overloaded drains, and melting snow. It is usually an optional add-on policy that becomes effective 30
days after purchase, unless the property is in a specific area and is collateral for a federal loan, in which
case it is a mandatory policy and effective immediately.

Question:
9. HO1
Answer:
This is the basic form of a homeowner's hazard insurance policy, and the default policy when a property
has been empty for any length of time. It covers fire, lightning, hail, and other perils.

Question:
10. HO2
Answer:
This form of a homeowner's hazard insurance policy covers more than the basic form, but not as much as
the special form. It is often available for second homes.

Question:
11. HO3
Answer:
This special form homeowner's hazard insurance policy offers the most coverage for the most reasonable
price, and is the preferred policy on primary residences. It covers both real and personal property.

Question:
12. HO6
Answer:
This form of a hazard insurance policy is designed for condominiums and can be customized to comply
with the condo association's bylaws.

Question:
13. HO4
Answer:
This renter's insurance policy is similar to the homeowner's insurance policy carried on primary residences,
but doesn't include coverage on real property owned by someone else.

Question:
14. Improvements
Answer:
Additions to property that increase its value or enhance its appearance. It can include buildings, fixtures,
and landscaping.

Question:
15. Landlord's policy
Answer:
This insurance policy is the reverse of a renter's policy and covers only the real property.

,Question:
16. Property Management
Answer:
A broad term for a person or company hired to maintain and manage a property on behalf of its owners,
and who are to maximize the owner's returns.

Question:
17. Real Estate Counsellors
Answer:
These people provide clients with competent, independent real estate advice without representing them as
an agent.

Question:
18. Special Flood Hazard Area
Answer:
Properties in this area are required by federal law to have special insurance as part of any federally-backed
mortgages.

Question:
19. Subdivision
Answer:
The process of splitting a single property into smaller parcels.

Question:
20. Residential
Answer:
The type of properties that include single and multi-family homes.

Question:
21. Industrial
Answer:
The types of properties that include warehouses, factories, power plants, and other manufacturing areas,
even if the property has a storefront attached.

Question:
22. Agricultural
Answer:
The types of properties that include farmlands, timberlands, orchards, and ranches.

Question:
23. Special Purpose
Answer:
The types of properties that include churches, schools, cemeteries, and government-held lands.

Question:
24. Real Estate Market

, Answer:
The setting where real property is bought and sold and prices are established.

Question:
25. Submarket
Answer:
A real estate market defined by property type and/or geographic location.

Question:
26. National Association of Realtors
Answer:
A professional real estate organization that requires members to uphold a specific set of ethics and pay
dues. In turn, the members can call themselves Realtors.

Question:
27. Seller's Market
Answer:
The situation where demand for real property is greater than the supply, which causes sale prices to rise
and builders to become more motivated to build.

Question:
28. Location
Answer:
This characteristic of real property is important because a parcel's value is impacted by surrounding land
uses.

Question:
29. Demographics
Answer:
This factor determines the quantity and type of housing in demand in a particular area. It evaluates family
sizes, ratio of adults to children, number of senior citizens, family incomes, lifestyles, etc.

Question:
30. Property
Answer:
This term refers to both a physical article and the rights and interests involved in its use of ownership.

Question:
31. Rights of Ownership
Answer:
A "bundle" of legal rights associated with owned property. These rights include possession, control of the
property (within legal bounds), enjoyment of the property, exclusion, and disposition.

Question:
32. Appurtenance