California Real Estate Exam 2024
Questions and answers | Updated
RATED A+
An insurance policy which combines personal liability insurance and hazard insurance
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coverage for a dwelling and its contents is called - Homeowners insurance
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What is the status of a contract when all the terms have been fulfilled and the transaction
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has been closed? - Fully executed
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Surface rights, air, rights, and subsurface rights are all rights that can be sold by a property
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owner while still retaining the property itself. These rights are known as: - Several rights
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When an easement allows the use of a neighboring property which automatically transfers
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upon the sale of either dominant or servient property. It is called what type of easement -
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Easement appurtenant
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Linda purchased a fee simple interest for the private use of a residential property for one
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week every single year. What did Linda purchase? - Resort timeshare
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What is the highest form of landownership which includes the full and complete bundle of
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property rights? - Fee simple absolute
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What type of ownership would allow two or more owners to have various unequal
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percentages of ownership? - Tenancy in common
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ii Tendency in severalty is best described as - One property owner ii ii ii ii ii ii ii ii ii ii ii ii
ii Which of the following is not one of the four land use controls? - intestate
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What is the general purpose for cities to require building permits? - To require a minimum
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level of construction standards
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ii The interest rate bank charge to their preferred customers is called - The prime rate
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The city of Brownwood plants to build a new water treatment facility, but the land that is
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required is privately owned. Eminent domain allows the city to - Take possession of the
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land against the owners wishes yet the owner must be compensated
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ii When the appraised value of a property is given, it is based on - Comparable sales
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Agent Brooke is preparing for a listing appointment and has gathered information to
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prepare a report of recent market data for the seller to review. The report agents reconcile
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, to obtain a reasonable list price for a property based on current listings, recent sales and
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expireds would be called. - Comparative market analysis (CMA)
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Paul owns an older residential property in an area now zone for commercial use. Paul
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decides to renovate the home into a laundromat. The change in the properties functionality
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for Paul's financial gain is an example of what - Highest and best use
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John's tire store is being built across the street from big Bob's tires. What appraisal
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principal describes this situation - Competition
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Buyer Sam purchased a rundown residential home in a neighborhood with many nice well-
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kept properties. Sam intends to renovate the home and resell it for a profit. Considering the
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nicer homes in the neighborhood help raise his property value, what appraisal principle is
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Sam leveraging ? - Progression
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During the appraisal process, the appraiser will never adjust the price of the - Subject
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property
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While working on an appraisal report appraiser, Jake finds that the comparable property is
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superior to the subject property with more amenities. How will Jake make adjustments to
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arrive at a value of the subject property? - Subtract value from comparable
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The beautiful town of big Bear is experiencing a fast influx of new residence. There are a
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few homes on the market and no new construction developments in the works. What will
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this do to the price of the existing homes in the area? - The prices will increase
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Homeowner Paul is selling his home without a real estate agent. He places an
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advertisement stating "owner financing 3% down payment" is Paul's advertisement in
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violation of the Truth in Lending act? - No property owners are not regulated by TRIL
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advertising requirements
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ii Which one of the following loan types does not require a down payment? - VA Loan
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Discount points are away lenders are able to charge prepaid interest in order to lower the
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interest rate over the life of the loan. What is the cost of the discount point based on? - The
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loan amount
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FHA loans require the borrowers provide protection to the lender in case of loan default.
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What must the borrower pay for to provide this protection to the lender? - Mortgage
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insurance premium
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Fair housing regulations apply not only to real estate agents, but also lenders. When a
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
lender denies a mortgage application solely based on the racial demographics of the
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neighborhood. The property is located in the lender is guilty of - Red lining.
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Lenders are to base credit decisions on the borrowers, credit worthiness.
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Questions and answers | Updated
RATED A+
An insurance policy which combines personal liability insurance and hazard insurance
ii ii ii ii ii ii ii ii ii ii
coverage for a dwelling and its contents is called - Homeowners insurance
ii ii ii ii ii ii ii ii ii ii ii ii ii ii
What is the status of a contract when all the terms have been fulfilled and the transaction
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
has been closed? - Fully executed
ii ii ii ii ii ii ii ii
Surface rights, air, rights, and subsurface rights are all rights that can be sold by a property
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
owner while still retaining the property itself. These rights are known as: - Several rights
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
When an easement allows the use of a neighboring property which automatically transfers
ii ii ii ii ii ii ii ii ii ii ii ii ii
upon the sale of either dominant or servient property. It is called what type of easement -
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
Easement appurtenant
ii ii
Linda purchased a fee simple interest for the private use of a residential property for one
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
week every single year. What did Linda purchase? - Resort timeshare
ii ii ii ii ii ii ii ii ii ii ii ii ii
What is the highest form of landownership which includes the full and complete bundle of
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
property rights? - Fee simple absolute
ii ii ii ii ii ii ii ii
What type of ownership would allow two or more owners to have various unequal
ii ii ii ii ii ii ii ii ii ii ii ii ii ii
percentages of ownership? - Tenancy in common
ii ii ii ii ii ii ii ii ii
ii Tendency in severalty is best described as - One property owner ii ii ii ii ii ii ii ii ii ii ii ii
ii Which of the following is not one of the four land use controls? - intestate
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
What is the general purpose for cities to require building permits? - To require a minimum
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
level of construction standards
ii ii ii ii
ii The interest rate bank charge to their preferred customers is called - The prime rate
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
The city of Brownwood plants to build a new water treatment facility, but the land that is
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
required is privately owned. Eminent domain allows the city to - Take possession of the
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
land against the owners wishes yet the owner must be compensated
ii ii ii ii ii ii ii ii ii ii ii
ii When the appraised value of a property is given, it is based on - Comparable sales
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
Agent Brooke is preparing for a listing appointment and has gathered information to
ii ii ii ii ii ii ii ii ii ii ii ii ii
prepare a report of recent market data for the seller to review. The report agents reconcile
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
, to obtain a reasonable list price for a property based on current listings, recent sales and
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
expireds would be called. - Comparative market analysis (CMA)
ii ii ii ii ii ii ii ii ii ii ii
Paul owns an older residential property in an area now zone for commercial use. Paul
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
decides to renovate the home into a laundromat. The change in the properties functionality
ii ii ii ii ii ii ii ii ii ii ii ii ii ii
for Paul's financial gain is an example of what - Highest and best use
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
John's tire store is being built across the street from big Bob's tires. What appraisal
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
principal describes this situation - Competition
ii ii ii ii ii ii ii ii
Buyer Sam purchased a rundown residential home in a neighborhood with many nice well-
ii ii ii ii ii ii ii ii ii ii ii ii ii ii
kept properties. Sam intends to renovate the home and resell it for a profit. Considering the
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
nicer homes in the neighborhood help raise his property value, what appraisal principle is
ii ii ii ii ii ii ii ii ii ii ii ii ii ii
Sam leveraging ? - Progression
ii ii ii ii ii ii ii
During the appraisal process, the appraiser will never adjust the price of the - Subject
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
property
ii
While working on an appraisal report appraiser, Jake finds that the comparable property is
ii ii ii ii ii ii ii ii ii ii ii ii ii ii
superior to the subject property with more amenities. How will Jake make adjustments to
ii ii ii ii ii ii ii ii ii ii ii ii ii ii
arrive at a value of the subject property? - Subtract value from comparable
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
The beautiful town of big Bear is experiencing a fast influx of new residence. There are a
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
few homes on the market and no new construction developments in the works. What will
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
this do to the price of the existing homes in the area? - The prices will increase
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
Homeowner Paul is selling his home without a real estate agent. He places an
ii ii ii ii ii ii ii ii ii ii ii ii ii ii
advertisement stating "owner financing 3% down payment" is Paul's advertisement in
ii ii ii ii ii ii ii ii ii ii ii
violation of the Truth in Lending act? - No property owners are not regulated by TRIL
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
advertising requirements
ii ii
ii Which one of the following loan types does not require a down payment? - VA Loan
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
Discount points are away lenders are able to charge prepaid interest in order to lower the
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
interest rate over the life of the loan. What is the cost of the discount point based on? - The
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
loan amount
ii ii
FHA loans require the borrowers provide protection to the lender in case of loan default.
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
What must the borrower pay for to provide this protection to the lender? - Mortgage
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
insurance premium
ii ii
Fair housing regulations apply not only to real estate agents, but also lenders. When a
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
lender denies a mortgage application solely based on the racial demographics of the
ii ii ii ii ii ii ii ii ii ii ii ii ii
neighborhood. The property is located in the lender is guilty of - Red lining.
ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii
Lenders are to base credit decisions on the borrowers, credit worthiness.
ii ii ii ii ii ii ii ii ii ii
