AR1120 GA MLS CRAM COURSE REAL ESTATE
FINAL EXAM QUESTIONS AND CORRECT ANSWERS
GRADED A+ 2024-2025
Definite sales price, Definite Time period
A right to buy at a future set time
Option money is
consideration - forfeit if not exercised
Unexercised is
uni-lateral
Exercised is
bi-lateral
Optionor (seller)
May sell to someone else if disclosed. New owner must honor existing option
Optionee (buyer)
Can sell or assign option to someone else
,Commission is earned only when?
Exercised
What cannot be used as legal descriptions for deeds, contracts and agreements?
Street address or assessor parcel number
Metes (measurements) and Bounds (monuments)
physical description of property (irregular shapes). Used when there is no recorded plat (lot and
block). Must end exactly at its point of beginning. Uses distances, bearings (compass directions), and
monuments
Recorded Plat (lot and block)
Uses numbers of lot, block, district, section, play book and page. Lists the subdivision, county, and
state names
Datum
Line from where a vertical height or depth is measured (sea level)
Geodetic Survey
Not GA; uses benchmarks to identify land
Rectangular (Gov.) Survey
Not GA; uses meridian (north/south) and base (east/west) lines. Cannot use for irregular shaped lots.
,Two types of contracts for loans
Note
Security (collateral) Document
A Note contract for loan
Signed before one signs a security document
Promise to pay and contains details
Creates debt
Not recorded
Negotiable
Allows lenders to raise cash (liquidity)
A Security document contract for loan
State contract
Non-negotiable
All recorded
All secure the debt and create a lien
Three types of loans
Security Deed
Mortgage
Trust Deed
Security Deed
, Title theory
Non-Judicial foreclosure
Two parties
Borrower (grantor-equitable title) transfers title to lender (grantee - defeasible title) at closing
Mortgage
Lien Theory
Judicial foreclosure
Two parties
Borrower (mortgager - legal title) - Lender (mortgagee - note/lien holder)
Trust Deed
Title Theory
Non-judicial foreclosure
Three parties
Borrower (trustor - equitable title) Lender (beneficiary - note holder) Trustee (holder of bare legal
(naked) title and forecloses if necessary.
Power of sale
authorizes holder of note (mortgagee) to sell property at auction without judicial foreclosure if allow in
the state
Lender qualifying borrower
Pre-approval letter needed prior to showing property (loan officer). Actual qualifying done by
Underwriting Department only. Conducted near closing
FINAL EXAM QUESTIONS AND CORRECT ANSWERS
GRADED A+ 2024-2025
Definite sales price, Definite Time period
A right to buy at a future set time
Option money is
consideration - forfeit if not exercised
Unexercised is
uni-lateral
Exercised is
bi-lateral
Optionor (seller)
May sell to someone else if disclosed. New owner must honor existing option
Optionee (buyer)
Can sell or assign option to someone else
,Commission is earned only when?
Exercised
What cannot be used as legal descriptions for deeds, contracts and agreements?
Street address or assessor parcel number
Metes (measurements) and Bounds (monuments)
physical description of property (irregular shapes). Used when there is no recorded plat (lot and
block). Must end exactly at its point of beginning. Uses distances, bearings (compass directions), and
monuments
Recorded Plat (lot and block)
Uses numbers of lot, block, district, section, play book and page. Lists the subdivision, county, and
state names
Datum
Line from where a vertical height or depth is measured (sea level)
Geodetic Survey
Not GA; uses benchmarks to identify land
Rectangular (Gov.) Survey
Not GA; uses meridian (north/south) and base (east/west) lines. Cannot use for irregular shaped lots.
,Two types of contracts for loans
Note
Security (collateral) Document
A Note contract for loan
Signed before one signs a security document
Promise to pay and contains details
Creates debt
Not recorded
Negotiable
Allows lenders to raise cash (liquidity)
A Security document contract for loan
State contract
Non-negotiable
All recorded
All secure the debt and create a lien
Three types of loans
Security Deed
Mortgage
Trust Deed
Security Deed
, Title theory
Non-Judicial foreclosure
Two parties
Borrower (grantor-equitable title) transfers title to lender (grantee - defeasible title) at closing
Mortgage
Lien Theory
Judicial foreclosure
Two parties
Borrower (mortgager - legal title) - Lender (mortgagee - note/lien holder)
Trust Deed
Title Theory
Non-judicial foreclosure
Three parties
Borrower (trustor - equitable title) Lender (beneficiary - note holder) Trustee (holder of bare legal
(naked) title and forecloses if necessary.
Power of sale
authorizes holder of note (mortgagee) to sell property at auction without judicial foreclosure if allow in
the state
Lender qualifying borrower
Pre-approval letter needed prior to showing property (loan officer). Actual qualifying done by
Underwriting Department only. Conducted near closing
