REAL ESTATE SALESPERSON NATIONAL PREP EXAM 1 ACTUAL 2024 COMPLETE EXAM CORRECTLY ANSWERD VERIFIED EXAMS WITH RATIONALES GRADED A+

REAL ESTATE SALESPERSON NATIONAL PREP EXAM 1 ACTUAL 2024 COMPLETE EXAM CORRECTLY ANSWERD VERIFIED EXAMS WITH RATIONALES GRADED A+ 1. John owns the dominant estate with an easement appurtenant. John sells the property. What happens to the easement? a. A commercial tenant's lease will expire at the end of the month. It is terminated by the sale. b. It belongs to the buyer. c. (Its ownership must be negotiated outside the sale. d. John retains ownership of the easement. Appurtenant ­ In real property law, this describes any right or restriction that goes with that property, such as an easement to gain access across the neighbor's parcel, or a covenant (agreement) against blocking the neighbor's view. 2. A commercial tenant's lease will expire at the end of this month. He is currently in the process of removing his display cases from the shop. What is true? a. He is not permitted to do that. b. He must negotiate with the owner if he wants the fixtures. c. He can take these trade fixtures as long as he removes them prior to lease end. d. He can only take them if he pays for them. 3. John, Maria and Mark are joint tenants. Mark dies. Maria sells her share to Jane. John and Jane are: a. joint tenants. b. tenants by partition. c. sole owners. d. tenants in common. A partition to tenants in common is the only way to divide interest out of joint tenancy and sell to a third party. Nothing can be sold out of joint tenancy. There is no such thing as tenants by partition. There is more than one owner so it can't be sole owner(s). Also John and Jane do not have the unity of time or title, which is a requirement of Joint Tenancy. 4. Mark's fence is trespassing on John's land. This is an example of: a. an encroachment. b. a lien. c. an appurtenance. d. a prescriptive easement. 5. John owns lakefront property. He has been granted water rights to the lake. He has: a. riparian rights. b. appropriative rights. c. littoral rights. d. prior appropriation. Water rights to lakes or oceans are called littoral rights in states that allow private ownership of navigable waters. Riparian rights are for rivers, creeks or streams. Appropriative rights relate to the use of water from all sources. Prior Appropriation Theory refers to first in time is first in right to use the water. 6. A surveyor has described a property from a point of beginning 200 feet north on Broad St. from the oak tree at the intersection of Main St. and Broad St., then 90° east for 100 ft., then 90° north for 50 ft., then 90° west for 100 ft., then 90° south for 50 feet back to the point of beginning. What type of description is this? a. Government Survey System b. Metes and Bounds c. Monuments d. Lot, block and subdivision plot 7. Mary's parents gave her a life estate. John is the remainderman. Mary leased the property to Bob for 5 years. During the lease, Bob died. What happens to the property? a. When the tenant dies the property goes to John. b. When the tenant dies the property goes to Mary's parents. c. When the tenant dies the property goes to Mary's heirs. d. When the tenant dies the property goes to Mary. 8. A property owner has defaulted on his mortgage and the lender has sent a notice of foreclosure. Before the foreclosure sale the owner is able to pay all he owes and reclaim the property. This is an example of: a. voluntary deed. b. redemption. c. accession. d. deed in lieu of foreclosure. 9. The local government has changed property use from commercial to R­1 (single­family residential) in your neighborhood. This is an example of the right of: a. police power. b. eminent domain. c. taxation. d. escheat. 10. Joe received payment from his title insurance company to compensate him for a defect in his title. Subsequently he was awarded a judgment against the seller, and collected the funds from the seller, to compensate him for the same defect. The title company has claimed the right to a refund from Joe. What clause in the title policy allows the title company to make this claim? a. subordination. b. arbitration. c. subrogation. d. defeasance. The "No Double Dipping" clause in a title insurance policy that the title company to go after the party that caused a title defect and collect the equivalent of any monies paid out to the policy holder. Subordination refers to a clause in a loan wherein the lender has a lower than first lien position. Defeasance means able to be defeated and arbitration is a dispute resolution process. 11. A buyer who wants to be sure he is getting good title to a property should rely on: a. an attorney's opinion of title. b. a title insurance policy. c. a general warranty deed. d. a title commitment based on the abstract of title from the title company. The general warranty deed protects you back to the sovereignty of the soil and is the best type of deed. Answers a, b and d all contain exceptions to coverage. 12. At closing a seller learns that he has an unsatisfied M&M Lien on his property. This is most likely the result of: a. property taxes. b. a fence that was built on the property, but not paid for. c. an IRS claim. d. a home improvement loan. A contractor's labor or materials not paid for are the reason for an M&M lien. M&M liens do not involve taxes or a loan. 13. An appraiser requires a property to have four characteristics to have value: a. delivery, utility, security and transferability. b. demand, urgency, security and title. c. demand, utility, scarcity and transferability. d. durability, utility, scarcity and title. 14. An appraiser has valued a single­family rental property in a neighborhood where almost all the homes are leased. What approach did he most likely use to determine the value for this property? a. the income approach b. the cost approach c. the sales comparison approach d. the GRM If the property produces income, use the income approach. The cost approach is for unique properties with no income or comps. The sales comparison approach is for residential properties with comps. The GRM is simply a tool with the income approach. 15. An older home has been updated for technology to eliminate what type of depreciation? a. physical deterioration b. economic obsolescence c. functional obsolescence d. external obsolescence 16. Using the market data approach, determine property value for a seller's 3 bedroom, 2­car garage home. There are two comparable home sales. The first has 4 bedrooms, a 2­car garage and sold for $300,000. The second has 3 bedrooms, a 1­car garage and sold for $285,000. A single garage has an estimated value of $5,000. A single bedroom has an estimated value of $10,000. The value is: a. $290,000.00 b. $295,000.00 c. $285,000.00 d. $292,500.00 17. Which of the following situations would require an appraisal? a. A seller wants to be sure to price his home competitively. b. A buyer wants to make a fair offer on a listed property. c. A parent wishes to gift a property to a child. d. A court­ordered partition is dividing a joint tenancy. Appraisals are required on any action involving the courts. For the other choices, a CMA would be sufficient. 18. A commercial property leases for $7,500/ month when fully occupied. Monthly operating expenses are $2,780. The property manager earns 8% of monthly rent. In March, one unit was vacant; rent for that unit is $725. How much did the property manager earn in March? a. $600.00 b. $166.80 c. $542.00 (7,500­725)*.08=$542 d. $283.20 19. An investor has purchased a property that is giving him a 10% rate of return. Potential gross rents total $10,000.00 a month. Expenses for the property total $47,570.00 per year. The property has a vacancy rate of 8%. What is the market value of the property? a. $628,300.00 b. $724,300.00 c. $722,020.00 d. $664,258.00 $10,000 x 12 = $120,000 gross rent $120,000 x .92 (occupancy rate) = $104,000 $104,000 ­ $47,570 = $62,830 $62,830/.10(ror) = $628,300 20. A party inherits a property. He wants to sell it quickly, as he wants the cash. He contacts a broker to list the property for $300,000. The broker knows that homes in that neighborhood are selling for $325,000 and more. What should the broker do? a. Take a net listing on the property. b. Buy the property himself as an investment or to resell. c. Provide the seller with a CMA and encourage the seller to price it correctly. d. List the property for $300,000 as this is what the seller wants. 21. A broker has listed his own property for sale. Which of the following statements is true? a. The broker must always disclose this dual role. b. The broker must disclose his ownership interest if asked. c. This is called dual agency. d. The broker cannot list his own property as it creates a conflict of interest. 22. What is true about the duties of all license holders? a. A license holder must treat all parties with honesty and full disclosure of all facts. b. A license holder owes all parties confidentiality and full disclosure. c. A license holder must treat all parties honestly and fairly. d. A license holder must treat all parties equally. 23. A buyer has provided confidential information about his income and bank account to his agent. The agent has forwarded this information to the listing agent. The listing agent has disclosed details to his seller client. Who is liable for violation of the duties of agency? a. The listing agent and the buyer's agent. b. The buyer's agent and broker. c. The listing agent and broker, and the buyer's agent and broker. d. The buyer's agent only. 24. A seller has received and accepted an offer on his property with a closing date of November 15th, time is of the essence. Two days before closing, the seller notifies the buyer that he will be unable to close on the required date, but will be able to close 2 days later if the buyer agrees. At that point this contract is: a. void. b. valid but unenforceable. c. voidable at the option of the buyer. d. invalid. 25. A buyer's written offer was presented to a seller. The seller sent a written counteroffer to the buyer. The counteroffer expires at 5 pm on Friday. Which of the following is true? a. The seller may withdraw any time before the buyer accepts the counteroffer. b. The seller may withdraw the counteroffer until 5 pm on Friday. c. The seller may withdraw any time before closing. d. The seller may not withdraw before 5 pm on Friday. 26. An agent's commercial listing is under contract. The closing date has been set and all contingencies have been met. The agent learns that government improvements in the area will have a big impact on the property value. The agent should: a. advise the seller to terminate the contract. b. disclose the information to the seller and continue with the sale. c. keep the information to himself. d. disclose the information to his broker and let the broker handle everything. 27. A contract that is signed but not yet carried out is: a. void. b. executory. c. fully executed. d. invalid. 28. A buyer wants the right to purchase a property during the next two months at a negotiated price and terms. What type of agreement should he enter into with the seller? a. An option contract. b. A sales contract. c. A contract for deed. d. An implied contract. 29. Which of the following creates a general agency relationship? a. A listing agreement. b. A buyer representation agreement. c. A management agreement. d. A sales contract. 30. Which of the following statements about a bilateral contract is false? a. It is an exchange of promises. b. It is binding on both parties. c. It requires strict performance on the date specified. d. Both parties can be sued. 31. Which of the following best defines or describes a counteroffer? a. A rejection of the offer and the presentation of a new offer in response. b. When a seller accepts some of the terms of an offer and changes others. c. When a party makes a simple inquiry as to whether the offeror would be willing to change the terms of an offer.