IAAO 102 FINAL SETS ANSWERS AND QUESTIONS
SET A+
✔✔What are the four types of mortgages classified according to repayment provisions?
- ✔✔1. Amortized
2. Straight
3. Reverse
4. Partially amortized
✔✔A payment on the balance due of a note at the end of the loan term that is in excess
of the regular payment amounts is called a ______? - ✔✔Balloon payment
✔✔What type of mortgage covers real estate as well as personal property included with
the real estate? - ✔✔Package mortgage
✔✔The four variables in real estate financing that affect the mortgage payment are: -
✔✔1. Amount borrowed
2. Interest rate
3. Term
4. Frequency of payment
✔✔List nine factors influencing the behavior of investors: - ✔✔1. Safety of investment
2. Size of investment
3. Time
4. Appreciation
5. Leverage
6. Liquidity of the investment
7. Use as collateral
8. Management
9. Income tax advantages
✔✔What reflects the return ON the investment? - ✔✔Overall yield rate
, ✔✔What rate reflects the relationship between the real estate taxes and the value of the
property? - ✔✔Effective tax rate
✔✔The summation concept is a theoretical procedure in developing the discount rate
for a real estate investment and is comprised of the following four parts: - ✔✔1. Safe
rate
2. Risk rate
3. Rate for non liquidity
4. Rate for management
✔✔In addition to sales and leases, what can be a valid source of market information, if
care is exercised? - ✔✔Offers & Listings
✔✔Fives sources of rental income: - ✔✔1. Commercial property managers
2. Tenants of comparable properties
3. Real estate brokers and sales people
4. Sellers and purchasers of comparable properties
5. Public records
✔✔What is another name for market rent? - ✔✔Economic rent
✔✔What type of lease provides for one or more extensions of the lease term in the
original lease document at the option of the tenant? - ✔✔Renewal lease
✔✔The fixed portion of the rent under the terms of a percentage lease is known as a
________? - ✔✔Minimal base rent
✔✔When contract rent exceeds economic rent, the difference is known as _____ rent? -
✔✔Excess rent
✔✔The rent that is over and and above the a guaranteed minimum base rent is referred
to as? - ✔✔Overage rent
✔✔A contract that requires a fixed minimum base rent and a variable rent based on
volume of business, sales, productivity, or use of the property by the tenant is called a
________ lease? - ✔✔Percentage
✔✔A lease in which the landlord is required to pay all operating expenses associated
with the real estate is known as a ______________ lease. - ✔✔Gross
✔✔A lease in which the tenant is required to pay all operating expenses associated with
the real estate is known as a ___________ lease? - ✔✔Triple net
SET A+
✔✔What are the four types of mortgages classified according to repayment provisions?
- ✔✔1. Amortized
2. Straight
3. Reverse
4. Partially amortized
✔✔A payment on the balance due of a note at the end of the loan term that is in excess
of the regular payment amounts is called a ______? - ✔✔Balloon payment
✔✔What type of mortgage covers real estate as well as personal property included with
the real estate? - ✔✔Package mortgage
✔✔The four variables in real estate financing that affect the mortgage payment are: -
✔✔1. Amount borrowed
2. Interest rate
3. Term
4. Frequency of payment
✔✔List nine factors influencing the behavior of investors: - ✔✔1. Safety of investment
2. Size of investment
3. Time
4. Appreciation
5. Leverage
6. Liquidity of the investment
7. Use as collateral
8. Management
9. Income tax advantages
✔✔What reflects the return ON the investment? - ✔✔Overall yield rate
, ✔✔What rate reflects the relationship between the real estate taxes and the value of the
property? - ✔✔Effective tax rate
✔✔The summation concept is a theoretical procedure in developing the discount rate
for a real estate investment and is comprised of the following four parts: - ✔✔1. Safe
rate
2. Risk rate
3. Rate for non liquidity
4. Rate for management
✔✔In addition to sales and leases, what can be a valid source of market information, if
care is exercised? - ✔✔Offers & Listings
✔✔Fives sources of rental income: - ✔✔1. Commercial property managers
2. Tenants of comparable properties
3. Real estate brokers and sales people
4. Sellers and purchasers of comparable properties
5. Public records
✔✔What is another name for market rent? - ✔✔Economic rent
✔✔What type of lease provides for one or more extensions of the lease term in the
original lease document at the option of the tenant? - ✔✔Renewal lease
✔✔The fixed portion of the rent under the terms of a percentage lease is known as a
________? - ✔✔Minimal base rent
✔✔When contract rent exceeds economic rent, the difference is known as _____ rent? -
✔✔Excess rent
✔✔The rent that is over and and above the a guaranteed minimum base rent is referred
to as? - ✔✔Overage rent
✔✔A contract that requires a fixed minimum base rent and a variable rent based on
volume of business, sales, productivity, or use of the property by the tenant is called a
________ lease? - ✔✔Percentage
✔✔A lease in which the landlord is required to pay all operating expenses associated
with the real estate is known as a ______________ lease. - ✔✔Gross
✔✔A lease in which the tenant is required to pay all operating expenses associated with
the real estate is known as a ___________ lease? - ✔✔Triple net
