Superior NC Real Estate Important Final
Exam Questions and Answers
What type of homeowner's insurance policy is typically required on a
condominium?
A. HO-1
B. HO-3
C. HO-5
D. HO-6 - ANSWER -D. Ho-6
An HO-6 policy is the condominium policy. It mainly covers the contents and the
interior of the unit as well.
A typical residential property management agreement would impose all of the
following duties upon a property manager, EXCEPT:
A. cleaning and maintaining the common areas
B.collecting rents due
C.maintaining records and reporting to the owner
D.establishing a depreciation schedule - ANSWER -D. establishing a depreciation
schedule.
Cleaning and maintenance of common areas will be included in the property
management agreement.
Which of the following is NOT an essential element of a promissory note?
A. promise to pay
B. lender's signature
C. terms of payment
D. amount of the debt - ANSWER -B. Lender's signature.
A good rule of thumb is that usually only the party "giving something up" is
required to sign the document. A promissory note only requires the borrower's
signature. A deed only requires the grantor's signature.
A loan in which the lender is making regularly scheduled payments to the
borrower would be referred to as a:
A. Graduated Payment Loan
B. Negative Amortization Loan
C. Reverse Annuity Mortgage (RAM)
D. Package Loan - ANSWER -C. Reverse Annuity Mortgage
, A loan where the bank (mortgagee) is making payments to the borrower
(mortgagor) is a reverse annuity mortgage (RAM). They were designed to allow
elderly individuals access the equity in their home without qualifying and having a
mortgage payment. Lender rules differ as to the age of the homeowner and the
amount of equity required to obtain this type of loan.
You are on a listing appointment and the sellers tell you they would like to net
$135,000 from the sale of their home. You estimate they will have to pay $950 in
miscellaneous closing costs, and you will charge them a 6.5% commission to sell
the property. They also have a loan payoff of $53,500. What must the property sell
for to ensure they receive their desired net?
A. $201,764.25
B. $145,401.06
C.$201,604.27
D.202,620.32 - ANSWER -D. $202,620.32
The seller must net $135,000 + $950 in costs + $53,500 payoff for a total of
$189,450. That amount represents 93.5% (100%-6.5%). $189,450÷.935 (93.5%) =
$202,620.32.
When a landlord is responsible for the payment of taxes, insurance and mortgage
payments, and the tenant is required to only pay rent, the lease is a(n):
A. Net Lease
B. Gross Lease
C. Ground Lease
D. Index Lease - ANSWER -B. Gross Lease
In a gross lease the tenant makes a lump sum payment for the amount of the rent
and the landlord is responsible for these expenses. The tenant pays nothing extra.
An attorney of fact is best described as
A. a fiduciary to his principal
B. an agent
C. an attorney
D. a client - ANSWER -A. a fiduciary to his principal
Which of the following is not essential to a general warranty deed for real estate?
A. signature of buyer
B. Signature of seller
C. Covenant of seisin
D. a legal description of real estate - ANSWER -A. Signature of buyer
Exam Questions and Answers
What type of homeowner's insurance policy is typically required on a
condominium?
A. HO-1
B. HO-3
C. HO-5
D. HO-6 - ANSWER -D. Ho-6
An HO-6 policy is the condominium policy. It mainly covers the contents and the
interior of the unit as well.
A typical residential property management agreement would impose all of the
following duties upon a property manager, EXCEPT:
A. cleaning and maintaining the common areas
B.collecting rents due
C.maintaining records and reporting to the owner
D.establishing a depreciation schedule - ANSWER -D. establishing a depreciation
schedule.
Cleaning and maintenance of common areas will be included in the property
management agreement.
Which of the following is NOT an essential element of a promissory note?
A. promise to pay
B. lender's signature
C. terms of payment
D. amount of the debt - ANSWER -B. Lender's signature.
A good rule of thumb is that usually only the party "giving something up" is
required to sign the document. A promissory note only requires the borrower's
signature. A deed only requires the grantor's signature.
A loan in which the lender is making regularly scheduled payments to the
borrower would be referred to as a:
A. Graduated Payment Loan
B. Negative Amortization Loan
C. Reverse Annuity Mortgage (RAM)
D. Package Loan - ANSWER -C. Reverse Annuity Mortgage
, A loan where the bank (mortgagee) is making payments to the borrower
(mortgagor) is a reverse annuity mortgage (RAM). They were designed to allow
elderly individuals access the equity in their home without qualifying and having a
mortgage payment. Lender rules differ as to the age of the homeowner and the
amount of equity required to obtain this type of loan.
You are on a listing appointment and the sellers tell you they would like to net
$135,000 from the sale of their home. You estimate they will have to pay $950 in
miscellaneous closing costs, and you will charge them a 6.5% commission to sell
the property. They also have a loan payoff of $53,500. What must the property sell
for to ensure they receive their desired net?
A. $201,764.25
B. $145,401.06
C.$201,604.27
D.202,620.32 - ANSWER -D. $202,620.32
The seller must net $135,000 + $950 in costs + $53,500 payoff for a total of
$189,450. That amount represents 93.5% (100%-6.5%). $189,450÷.935 (93.5%) =
$202,620.32.
When a landlord is responsible for the payment of taxes, insurance and mortgage
payments, and the tenant is required to only pay rent, the lease is a(n):
A. Net Lease
B. Gross Lease
C. Ground Lease
D. Index Lease - ANSWER -B. Gross Lease
In a gross lease the tenant makes a lump sum payment for the amount of the rent
and the landlord is responsible for these expenses. The tenant pays nothing extra.
An attorney of fact is best described as
A. a fiduciary to his principal
B. an agent
C. an attorney
D. a client - ANSWER -A. a fiduciary to his principal
Which of the following is not essential to a general warranty deed for real estate?
A. signature of buyer
B. Signature of seller
C. Covenant of seisin
D. a legal description of real estate - ANSWER -A. Signature of buyer
