Massachusetts Real Estate License Exam Practice - KGO 100% Correct

Emma, a Massachusetts licensed salesperson, wants to place an advertisement in Brookline's local real estate magazine. What must she be sure to include? A. A fair housing statement B. Her broker's complete information C. Her email address D. Her license number - Answer B Evan bought into a Massachusetts housing cooperative that's focused on cultural exchange. Each month the co-op residents have dinner meetings and share food and culture from their respective regions. When Evan made his purchase, he received a proprietary lease for his unit. What else did he receive? A. Contract of mortgage B. Deed C. Plat maps D. Shares in the cooperative corporation - Answer D Sylvia, 15, and her neighbor, Marge, 24, agree 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 - Answer D Massachusetts requires that agency disclosures be given to consumers who are considering becoming clients of a licensee. In what other circumstance must an agency disclosure be provided? A. At an open house, to inform all attendees about types of agency available B. When a licensee and client meet to discuss an offer C. When an offer is made to a seller, to let all parties know who the licensee represents D. When anyone comes into the brokerage office - Answer C 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 A. Expired B. Foreclosed C. Pending D. Withdrawn - Answer C Jim represents Joel in the sale of Joel's country acreage and house. Jim's business partner, Rolly, is interested in purchasing the property to subdivide. 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 must disclose that he's partners with Rolly. C. Jim must disclose that Rolly is his partner and that Rolly intends to subdivide the property to make a profit. D. Rolly must disclose that he and Jim are business partners. - Answer C Dana lives in her Newport property nine months out of the year and uses it as a rental for the remaining three months. Is she liable for paying an excise tax on her short-term rental? A. No, because it only applies to short-term rentals of fewer than eight consecutive days. B. No, because it's her primary residence for nine months out of the year. C. Yes, because it applies to residential short-term properties unless they are rented for fewer than 14 days per calendar year. D. Yes. The excise applies to short-term rentals of any length. - Answer C Chrissy lives in Lake Ridge Estates, a neighborhood in which no one is allowed to put up vinyl siding on their homes. This HOA regulation is what kind of private land control? A. CC&R B. Deed restriction C. Law D. Regulation - Answer A Gladys and her husband, Ralph, owned their Cambridge home as joint tenants. After Ralph died, Gladys owned the home in severalty. When she dies, which of these will happen to her home? A. Her heirs, as described in her will or according to state law, will receive the property. B. Her home will transfer automatically to a co-owner. C. The property will have no owner and must be sold at auction. D. The property will revert to a remainderman. - Answer A A real estate transaction has a closing date of May 20. The seller, who's responsible for closing costs up to but not including the day of settlement, has already paid annual property taxes of $1,949. Using calendar year proration, the seller will be ______ on the closing statement. A. Credited $1,207 B. Credited $742 C. Debited $1,207 D. Debited $742 - Answer A 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. - Answer A Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 states that its purpose, in part, is to require that real estate appraisals used in connection with federally related transactions be performed ______. A. By licensed real estate professionals B. By members of the Appraisal Foundation C. In the most expeditious and inexpensive way possible D. In writing, and in accordance with uniform standards - Answer D Which of these actions is the Board of Registration of Real Estate Brokers and Salespersons responsible for performing? A. Auditing brokerage escrow accounts to verify proper handling of earnest money B. Auditing brokerage operational accounts to ensure the firm's financial stability C. Examining brokerage contracts with salespeople to ensure compliance with employment laws D. Examining brokerage policies and procedures manuals for compliance with ethical standards - Answer A Which of these 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 - Answer A Which of the following applicants meets the experience requirements for a broker license in Massachusetts? A. Jill is a certified residential appraiser and has a real estate degree. B. Kerry has had a Massachusetts salesperson license for 30 months. C. Maggie has been affiliated as a salesperson with a Massachusetts broker since May 1988. D. Mike has held his Massachusetts salesperson license for 20 months and is working on his real estate degree. - Answer C Blake is allowed to use his property in a way that's prohibited under current zoning ordinances, because those ordinances would cause undue hardship for him. What gives him this permission? A. Area variance B. Moratorium C. Special use permit D. Use variance - Answer D Assuming licensee Shannon has actual knowledge of all of the following property issues, which should she disclose to prospective buyers? A. The nearby school system is one of the worst in the area. B. The neighbors like to throw a lot of parties. C. The tree in the front yard is at least 50 years old. D. The upstairs bathroom has a leaky toilet. - Answer D What's the maximum amount of compensation an unlicensed individual in Massachusetts may legally receive for assisting someone in the sale of a home? A. 0 B. No maximum C. Not more than $200 in cash or items of value D. Not more than $500 in cash or items of value - Answer A A deed may be best described as what? A. A covenant B. A document to transfer ownership/interest in real estate C. An abstract of title D. A recording fee - Answer B Jamison, the seller, is closing on his property with Conrad, the buyer. 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. - Answer D To which of the following borrowers might a lender be most likely to recommend an FHA loan? A. An investor who intends to use equity in another investment property as his down payment B. A retired couple interested in downsizing from a large four-bedroom house they own free and clear to a condominium C. A single stockbroker with a $40,000 down payment and significant assets in a stock portfolio D. A young couple with only a few thousand dollars saved for a down payment and relatively low credit scores - Answer D In a standard real estate transaction, ownership is conveyed by deed. How is ownership of registered land conveyed? A. Through a certificate of title issued by the Massachusetts Land Court B. Through a leasehold agreement C. Through a quitclaim deed D. Through a superior court hearing in which the deed transfer is approved by the state - Answer A Bernie is representing Oscar in the sale of Oscar's home. They have signed an exclusive right-to-sell listing agreement. If Oscar finds his own buyer, does he owe Bernie a commission? A. No, because he found his own buyer B. No, because Oscar retained his exclusive right to sell C. Yes, because exclusive right to sell means Bernie gets paid no matter who finds the buyer D. Yes, because Oscar is not a real estate licensee - Answer C Which of these 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? - Answer A 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 - Answer D Licensee Madge is moving to her new home. What must she remember to do or risk losing her license? A. Notify her principal broker of her change of address B. Notify the board of her change of address C. Take out a newspaper ad to notify the public of her change of address D. Write in her new address on her real estate license - Answer B 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, if in six months Lewis' condo is worth much more. Which economic characteristic does this demonstrate? A. Area preference B. Improvements C. Permanence D. Scarcity - Answer A Which of the following is most likely to be the cause of an adjustment to a comparable (competitive) when preparing a CMA? A. Busy street B. Color C. Demographics D. Interest rates - Answer A A seller wants to break even after the broker's commission of 5% and loan balance of $300,000 are paid. At what price must the house sell? A. 150,000 B. 300,000 C. 315,789 D. 450,000 - Answer C Gerald is selling a property in Lancaster that is not on the public water and sewer systems. He must provide a copy of the results proving that water from the well is safe and that the sewage disposal system works. Within what time frame must the results be provided to the local board of health? A. Within 10 days B. Within 20 days C. Within 22 days D. Within 30 days - Answer D What violation of license law will the board penalize with a fine of up to $500? A. Discriminatory actions B. Mishandling of trust funds C. Practicing real estate without a license D. Substantial misrepresentation - Answer C Isaac keeps a record of the age, race, and gender of his clients to help him better target his marketing efforts. Which of the following statements is true? A. Isaac may keep records on the age and gender of his clients, but not on race. B. Isaac may maintain such records if the records are inaccessible to anyone else in his firm. C. Isaac may maintain such records if they aren't used to discriminate. D. Keeping any record regarding the protected class status of clients is prohibited. - Answer D Clarissa is allowed to phone Gerry in Hingham, who's on the National Do Not Call Registry, even for solicitation purposes, because ______. A. Gerry is listed in the phone book B. She has an established business relationship with Gerry C. She's calling on behalf of her broker D. She's calling on behalf of one of her clients to see if Gerry is interested in selling his property in Hingham - Answer B Lorena and Julio purchased a home for $205,950. Their loan amount was $164,760, and the assessed value is now $201,500. Their tax rate is 0.63%. How much will their monthly taxes be? A. $105.79 B. $111.04 C. $191.37 D. $86.49 - Answer A 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 - Answer D Which 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 add another addendum to the sales contract. C. There is an unexpected death in the agent's family. D. The specified term in the agency agreement expires. - Answer D Massachusetts lead-based paint hazards law requires owners and landlords to ______. A. Disclose the presence, but not the potential presence, of lead-based paint in a home B. Perform a lead-based paint inspection prior to selling or renting a home C. Remediate lead-based paint in mouthable locations such as window sills, stair risers, wall corners, etc., if a child under six years of age will reside in the home, up to a height of five feet D. Remediate (remove or encapsulate) lead-based paint in any location where it occurs in a home up to a height of five feet - Answer C An agent, Alice, has listed a three-bedroom home for her client. 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 upon destruction of the property. 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. - Answer B Under which of the following circumstances is age an acceptable qualifier for a Massachusetts buyer or tenant? A. When deciding whether to show upper story properties with no elevator B. When determining whether the presence of young children would require lead-based paint remediation C. When screening for tenants interested in renting in a community designated for elderly residents D. When selecting the best neighborhoods for a buyer client based on available schools - Answer C Jules is new to property management. Which of the following tasks may be one of her duties? A. Creating a budget for next year's projected maintenance costs B. Investing profits from the business C. Purchasing the apartments to be managed D. Representing the owner in court - Answer A Jared wants to purchase property. One of the properties his agent shows him was formerly zoned for commercial use. It has a steep drop off at the back of the property, as well as some soft spots and mounds. Should his agent recommend that he have a home inspector investigate it? A. No, Jared can address the cliff by bringing in additional soil. B. No, Jared is going to bulldoze the entire property to flatten it out anyway. C. Yes, these are clues that the property may have been used as a waste disposal site. D. Yes, these are indications of an underground storage tank. - Answer C What factors does the underwriter consider in reviewing a mortgage loan application? A. Capacity, collateral, and criminal record B. Credit, capacity, and collateral C. Credit, capacity, and collections D. Credit, credentials, and collateral - Answer B When must the Massachusetts home inspection disclosure fact sheet be given to a buyer? A. During the home inspection B. When a signed Offer to Purchase is submitted C. When the buyer signs an agency agreement D. When the seller verbally accepts the buyer's offer - Answer B 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. - Answer A A local buyer is purchasing a property for $120,000. What will the seller pay in transfer tax if the rate is $.37 per $100? A. 370 B. 3,700 C. 4,400 D. 444 - Answer D An easement dictates that property owner A gives the right to property owner B to use a portion of the property. Which term describes property A? A. Domain estate B. Dominant estate C. Service estate D. Servient estate - Answer D Hope's mortgage created a lien against the property she purchased with the mortgage. What kind of lien is this? A. General B. Special assessment C. Vendor's D. Voluntary - Answer D 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. - Answer D Which of the following is a promise on the part of the borrower to repay a certain sum of money to another party (the lender or holder of the note) under specified terms? A. Deed of trust B. Mortgage lien C. Promissory note D. Usury - Answer C Requirements for renewal of a salesperson and a broker license in Massachusetts are similar, but what must a broker do that's not required of a salesperson at renewal? A. Have a $5,000 surety bond in place B. Pass a renewal licensing exam C. Pass the board's review of all transactions under the broker's name D. Pay a fee - Answer A Chelsea's mother owns several rental properties and intends to keep them to pass on to the family. Chelsea holds a special power of attorney to manage the rental properties, including working with the property manager to place and evict tenants as necessary. Which of these would violate the POA? A. At the property manager's recommendation, Chelsea evicts a long-time tenant for failure to pay rent. B. Chelsea instructs the property manager to prepare the quarterly financial reports. C. Without consulting her mother, Chelsea decides to completely refurbish one of the properties. D. Without consulting her mother, Chelsea hires a plumber to fix a major plumbing problem in one of the properties. - Answer C Massachusetts State Sanitary Code protects ____________ should the rental property they reside in becomes uninhabitable. A. Landlords B. Lessors C. Owners D. Tenants - Answer D Leo's client is looking for a property with at least 2,500 finished square feet. He finds a 2,200-square-foot property with all the other features the client is looking for and purposely fails to mention the square footage. His client agrees to look at the property, falls in love with it, and wants to make an offer. Which of these statements accurately represents Leo's level of misrepresentation in this situation? A. Because Leo didn't state the square footage, he's not guilty of misrepresentation. B. It's the buyer's responsibility to ensure that the property has the proper square footage, so Leo's in the clear. C. Leo obviously knew about the square footage and intentionally didn't mention it. He's guilty of intentional misrepresentation. D. Leo omitted a material fact. This is considered unintentional misrepresentation. - Answer C Licensee Maria is being sued under the Massachusetts Consumer Protection Act. Jacob claims he incurred a $50,000 loss as a result of Maria's intentionally misleading advertising. If Jacob wins the suit, what's the most the court can award Jacob for damages? A. 15,000 B. 150,000 C. 25,000 D. 50,000 - Answer B What happens to an initial offer from the buyer after a seller counters? A. It becomes the back-up offer. B. It's accepted by the seller, until the buyer accepts the counter. C. It's no longer in play. D. Sellers cannot counter a buyer's initial offer. - Answer C Jared has a 70/30 split with his brokerage firm, and his firm has a 50/50 split with cooperating brokerages. Last month, he was paid $12,239.50 in commissions from his home sales, which totaled $538,000. What is the brokerage's commission rate? A. 0.023 B. 0.038 C. 0.065 D. 0.076 - Answer C Which approach to value is typically used for investment property of two- to four-family units? A. Cost approach B. Income approach C. Revenue approach D. Sales comparison approach - Answer B What must sellers provide prospective buyers of homes built prior to 1978, in addition to the appropriate disclosure form? A. EPA lead safety pamphlet B. List of reputable home improvement contractors C. Verbal assurance that the home is lead-free before offering it for sale D. Written proof that the home is lead-free - Answer A Burt owns a development company that specializes in constructing new, highly energy efficient houses. The best approach for an appraiser to use in the appraisal of Burt's newly built homes is the ______. A. Appraisal process B. Cost approach C. Income approach D. Sales comparison approach - Answer B Desmond has a signed listing agreement with his clients, the Harpers. In exchange for helping the Harpers list, market, and sell their home, the Harpers have agreed to pay Desmond a commission. What type of agreement do Desmond and the Harpers have? A. Bilateral B. Executed C. Mutual D. Unilateral - Answer A Beverly doesn't represent either party to this Massachusetts real estate transaction. She's just here to handle the paperwork once the two parties finish negotiations. What role is Beverly taking in this transaction? A. A designated agent B. A dual agent C. A facilitator D. A sub-agent - Answer C Subdivision regulations imposed by developers in an effort to maintain control of the development of the subdivision are an example of ______. A. Eminent domain B. Private land use control C. Profit limitations D. Taxation - Answer B Fewer buyers in a higher price range would create what kind of pressure on housing prices? A. Downward B. Steady C. Strong D. Upward - Answer A Because there were no deadlines specified in the contract, Myron didn't think there was a problem with his waiting to apply for a loan to help purchase the property. He was therefore a little surprised and not very happy when the seller sued him for breach of contract, stating that the delay was impacting the seller's ability to purchase a new home. What did Myron fail to do? A. Complete his loan application correctly. B. Notify the seller that he had a loan contingency. C. Perform his contractual obligations within a reasonable time. D. Talk to the seller about the seller's contingency to sell his house in order to buy another property. - Answer C Which of the following factors helps the IRS determine whether a licensee is classified as an employee or an independent contractor? A. Whether another broker supervises the licensee B. Whether the brokerage offers regular guidance and instruction to the licensee C. Whether the firm provides the licensee with a copy of the brokerage's policies and procedures manual D. Whether the licensee receives benefits from the brokerage firm - Answer D Buyer Daphne and seller Kurt signed a sales contract with a definite closing date of May 15. Daphne now finds that she needs to move the closing date to June 15. She'll accomplish this with an ________ to the sales contract. A. Addendum B. Amendment C. Annotation D. Appendix - Answer B Richard owns a 25-unit apartment complex in Springfield. He's modified five of his units to be fully accessible, and all five units are occupied. Which of the following statements is true based on state fair housing laws? A. Richard has met the requirement for number of units that must be modified for accessibility. B. Richard is required to have all first-floor units modified for accessibility. C. Richard must modify an additional unit if another disabled individual wishes to rent it. D. Richard must modify at least 25% of his units for handicapped accessibility. - Answer A 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. - Answer C Jerome is developing an ad for three properties he has listed in an upscale community. He wants to keep it short and simple. Which of these would NOT trigger full disclosure under TILA? A. 10% down payment B. 30-year fixed rate with no points C. A monthly payment of $900 D. Get a low 4.925% APR - Answer D In a real estate transaction in which you represent the seller, your duty to other parties is to ______. A. Be honest in all matters that do not affect your client's interests B. Be polite and courteous C. Maintain the confidentiality of all matters that other parties disclose to you D. Treat them honestly and fairly - Answer D Which of these statements about a conventional mortgage loan is true? A. Borrowers with larger down payments and higher credit scores are most likely to select a conventional mortgage. B. Conventional mortgages are non-conforming. C. FHA imposes loan limits (maximum loan amounts) on conventional mortgages. D. The government insures up to 25% of conventional mortgages for qualifying buyers. - Answer A Ashish is purchasing a bank-owned property. His real estate agent tells him the bank is offering insurable, not marketable, title. What does this mean to Ashish? A. An insurable title has uncurable title defects, so Ashish terminate his contract. B. Insurable title carries a higher standard of assurance than marketable title, so Ashish shouldn't be concerned. C. Insurable title is one that may have known defects but is still insurable. Ashish should carefully review the title policy. D. The title company will include any easements or other title defects as exceptions on the policy, which is a concern for Ashish. - Answer C Even though Massachusetts is a caveat emptor state, and sellers don't have to volunteer a great deal of information about a property's condition, what must sellers disclose? A. A basement that floods B. The potential presence of lead-based paint C. The property's square footage D. Why they're selling the property - Answer B 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 - Answer D Which of the following is price fixing? A. A brokerage requires all licensees to offer a fair cooperative brokerage fee. B. Three brokerages agree to purchase office supplies together to obtain a bulk discount. C. Twelve brokerages discuss compensation of associated independent contractor licensees. D. Two brokerages determine a standard commission rate. - Answer D Lenore makes a 95% offer on a townhouse that's listed at $285,000 and includes an earnest money deposit for 10% of her offer, which the seller accepts. She brings to closing a cashier's check for $35,025 comprising the balance of her 20% down payment and closing costs. What's the amount of her total down payment? A. 35,025 B. 54,150 C. 57,000 D. 62,100 - Answer B Alice owned a double lot on the waterfront. She sold the lot to Ronesha and included a deed restriction prohibiting anything taller than a one-story building. 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. - Answer C Glenn is purchasing a home for $400,000. The property appraised at $415,000 and Glenn is financing $300,000. What's the loan-to-value ratio? A. 0.72 B. 0.75 C. 0.82 D. 0.96 - Answer B In order to be an effective property manager, a licensee must be familiar with a variety of ______. A. Agency disclosures B. Employment contracts C. Independent contractor agreements D. Lease agreements - Answer D Monica and Chandler terminated their lease and moved out of their Worcester rental 20 days ago, but they haven't received their security deposit even though they kept their unit spotless. What should they do? A. Advise the landlord in writing that they are now owed their security deposit plus 5% interest. B. File a formal complaint with the National Association of Landlords. C. Take the landlord to court and sue for the security deposit or attorney's fees and $200, whichever is greater. D. Wait because the landlord has 30 days to return the deposit. - Answer D 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 - Answer A 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. - Answer C Stan and Margo want to redevelop an old industrial site in order to create a microbrewery and event space. However, an environmental review found that hazardous chemicals were once used on site, and there is a possibility they will be released during redevelopment. Stan and Margo may not be liable for cleanup, under what federal law? A. CERCLA B. EIS C. SARA D. Wetlands Conservation Act - Answer C Which of the following statements about the federal Wild and Scenic Rivers Act is true? A. Communities may designate various waterways as scenic rivers. B. Massachusetts created the Wild and Scenic Rivers System to protect its inland waterways. C. Rivers with remarkable attributes may be designated as scenic, thereby earning additional protections. D. The act is designed to permit damming of various rivers to increase recreational use. - Answer C Roger is an unlicensed assistant in Dave's office in Attleboro. He performs tasks for several of the firm's licensees. Katherine is a licensed assistant, and she performs tasks for three of the firm's independent contractor licensees. The firm's broker, Michaela, has her own licensed assistant. Which of these statements best represents Michaela's liability for the acts of all these assistants? A. Michaela is only responsible only for her own personal assistant. B. Michaela is responsible for all licensees and employees associated with the firm. C. Michaela is responsible only for the licensed assistants. D. Michaela is ultimately responsible for her assistant and for Roger (the unlicensed assistant). - Answer B A landlord has an available unit, but refuses to show it to several applicants. These applicants are all single women with children; the applicants who are shown the apartment are all individuals or couples without children. In what way is the landlord violating fair housing law? A. He is advertising the unit in a restrictive way that discriminates against those with children. B. He is discriminating against people based on sex and familial status by refusing to show available housing. C. He is discriminating by offering special terms for rental based on a protected class status. D. He is sexually harassing potential tenants. - Answer B Examples of real property include which of the following? 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 - Answer D 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. - Answer B Douglas is the buyer's agent for a transaction in Massachusetts which May (from a different brokerage) listed her seller client George's property. From whom will Douglas receive his compensation? A. From George B. From his own broker C. From May's broker D. It depends - Answer B A seller received $800,000 for a 5.5 acre rectangular parcel alongside a road frontage. The property is 400' deep. What was the price per front foot of the property? A. 1335.67 B. 2000 C. 363.64 D. 598.95 - Answer A Marilyn is reviewing the inspection report with her buyer clients. Which of the following issues in the report should Marilyn flag as most significant? A. Broken dishwasher B. Lack of deadbolts C. Non-working sump pump D. Presence of mold - Answer D Ethan, a Massachusetts real estate licensee, has signed an exclusive right-to-sell brokerage agreement with a seller client, Olivia. Which of the following statements is true about their agency relationship? A. Ethan can't act as a dual agent in the transaction. B. Ethan must work exclusively with Olivia and may not work with other clients engaged by the firm. C. Olivia agrees to have Ethan represent her, but she won't owe him a commission if she brings a buyer to the table. D. Olivia will work exclusively with Ethan and his brokerage firm. - Answer D Which of the following statements is true about a tenancy at will lease, according to the Massachusetts lease's Term provision? A. Early termination by either party requires 30 days' prior written notice. B. The landlord can terminate the lease at will and without notice. C. The lease renews automatically upon expiration. D. Upon expiration, the lease converts to a month-to-month tenancy. - Answer A Which of the following is a protected class in Massachusetts fair housing law, but isn't protected by federal fair housing law? A. Disability B. Gender identity C. Race D. Religion - Answer B Massachusetts antitrust laws closely parallel federal laws. Which of the following actions are prohibited under both federal and state law? A. ABC Brokerage agrees to handle transactions in the east side of the city, and XYZ Brokerage, the west side of the city. B. George and Georgia agree to allow the brokers in both their firms to adjust commission rates to suit a given transaction. C. Gina refuses to show properties offered by Bay City Realty unless Bay City agrees to pay a cooperating broker commission. D. Rita offers her seller clients the choice of using her brother's title insurance firm or another firm of the seller's choice. - Answer A Which of the following statements about Massachusetts purchase offers is true? A. Licensees aren't required to present verbal offers to the seller. B. Licensees must present all purchase offers to the seller. C. Licensees should only present realistic offers to the seller. D. Licensees should use their own discretion to determine which offers to present to the seller. - Answer B 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. - Answer B Which of the following statements about smoke alarms in Massachusetts is true? A. At least one smoke alarm must be installed on each level of a home, including the attic and basement. B. Combination smoke alarms and carbon monoxide detectors are not permitted. C. Smoke alarms are required in garage areas. D. Smoke alarms must be installed on all habitable levels of a home, outside each sleeping area, and in the basement. - Answer D On Monday morning, Sammie, a Massachusetts broker, is making a trip to the bank to deposit a check for earnest money she received the previous night. Which of the following is a true statement? A. She may use the funds to cover expenses related to the transaction. B. She must deposit the funds into an interest-bearing account. C. She must deposit the funds into a trust or escrow account. D. She owns the funds. - Answer C Which of the following statements best describes a purchase and sale agreement in Massachusetts? A. A legally binding, oral contract between a property's potential buyer and a listing agent B. A legally binding, oral contract between a property's potential buyer and seller C. A legally binding, written contract between a property's potential buyer and seller D. A legally binding, written contract between a property's seller and a listing agent - Answer C 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. - Answer B In which of the following situations would the state be able to use its power of escheat? A. Hannah passed away with no children and no debt, other than $83,000 left on her mortgage. B. Maury died, and his three children are upset because his estate isn't large enough to settle all of his debts. C. Nadine died with no heirs and no debt. D. Sam died with no will, and his son lives overseas. - Answer C John and Amy purchased a builder's home warranty when they bought their home. They have found structural damage that could be a detriment to their home. On average, how many years does a home warranty cover structural damage? A. 10 years B. Five years C. One year D. Three years - Answer A Assuming that dual agency is legal where these scenarios occur, and the licensees' brokerages permit it, which of these situations demonstrates illegal dual agency? A. At an open house Tom is holding for his client, Rod, 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. B. 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. C. 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. D. Levi's customer, Renee, wants to make an offer on Levi's seller client's home. Levi presents Renee's offer to his client. - Answer A Which of these situations represents the illegal practice of blockbusting? A. Celia, a licensee, distributed a flyer in several neighborhoods, claiming that gentrification of those neighborhoods will increase property values. B. Corbin tells homeowners in Five Points that an impending influx of Asian immigrants will reduce property values. C. Estelle, a broker, warns potential clients about the upcoming zoning change in a neighborhood that is currently zoned as residential. D. Kian, a mortgage broker, refuses to underwrite mortgage applications from applicants who are Hispanic or Asian. - Answer B Leonard is offered a loan at 5.75%. Because he plans to be in his home for several years, he chooses to pay points up front to have the rate reduced to 5.25%. What's this an example of? A. Down payment B. Usury C. Buydown D. Gap financing - Answer C Jeffrey has accepted an offer of $299,000 for his house. The buyer is making a $50,000 down payment and the buyer's appraisal came in at $300,000. On what number will the buyer's lender base the loan-to-value ratio? A. $300,000 B. $299,000 C. $310,000 D. There's no way to tell given the data provided. - Answer B Home purchased for $299,000. Appraised value is $300,000 Which value will be used to determine the Loan to Value Ratio? A. $299,000 B. $300,000 - Answer A The Bransons have a conventional loan for which they were required to obtain private mortgage insurance. Their local real estate market has been on fire lately, and their house is now appraised at twice their loan balance! Will their PMI be automatically cancelled? A. Yes, because their equity is over 20%. B. No, because PMI lasts for the life of the loan. C. Yes, because their equity position is at least 50%. D. Maybe, but they'll have to petition their lender. - Answer D Does PMI last for the life of the loan? Yes or No - Answer No Cancellation of PMI happens once the borrower reaches a _________ % equity position or has a loan-to-ratio value that is ________% or lower. - Answer 22 80 Which of the following best describes annual percentage rate (APR)? A. The amount a borrower pays in interest for a single year B. Fees charged by a lender, expressed as a percentage C. The amount a lender can collect in interest from a borrower during a single year D. A standardized measure for interest rates and other loan costs - Answer D Sam's not very good with planning for his expenses. He has a mortgage payment that includes his property taxes and property insurance (PITI), so he can knock those all out with his mortgage payment every month. Sam's also happy to know that his monthly payment will remain the same for the life of his loan. What type of mortgage does Sam have? A. Straight B. Budget C. Amortized D. Adjustable - Answer B Sondra, a buyer, signs all the required mortgage documentation, and promises to make all payments to her lender. Unfortunately, Sondra falls on hard times and misses multiple payments, and the bank indicates that it is going to foreclose on her. The foreclosure proceedings are more difficult for the lender because Sondra holds the title to the land. What kind of state does Sondra live in? A. A lien theory state B. A deed of trust theory state C. A title theory state D. An intermediary theory state - Answer A Which of the following statements is true about conventional loans? A. Originators usually package and sell the loans on the secondary market. B. They're guaranteed by the U.S. Department of Veterans Affairs. C. They're insured by the Federal Housing Administration. D. They're provided by the U.S. Department of Agriculture. - Answer A True or False Government agencies aren't involved in creating a conventional loan. - Answer True Which of the following is a true statement about FHA financing? A. An FHA loan is usually more attractive to borrowers who have lower credit scores and down payments. B. FHA loans are available to all borrowers, regardless of credit history. C. FHA loans are best for borrowers who have large down payments. D. FHA loans have more stringent requirements than conventional loans do. - Answer A Sandra retired from a career in the Navy and is ready to buy her first home—a small bungalow in a quiet neighborhood—for $169,900. Her military service qualifies her for a VA-guaranteed loan. What's her required down payment? A. 0% B. 3.5% C. 15% D. 20% - Answer A True or False VA-guaranteed loans can be obtained without any down payment and don't require mortgage insurance. - Answer True Chris owns Country Time Ranch and wants to expand his sheep and lamb farm by branching into milk production and cheese making. He wants to purchase the property adjacent to his farm, which would give him an extra 10 acres of farmland. Chris's ranch will provide a significant boost to the local economy. Assuming his income meets the program's criteria, what type of loan may Chris find the most desirable? A. VA-guaranteed loan B. Wrap-around mortgage C. Rural development loan D. Growing equity mortgage - Answer C