Real Estate Exam Questions and Answers 100% Pass

Real Estate Exam Questions and Answers 100% Pass A corporation is a legal entity (an artificial person); therefore, real estate owned by the corporation is owned in - Correct Answer ️️ -severalty A person who receives title to real property through a last will and testament is called a - Correct Answer ️️ -devisee Tom, Rick, and Harry own a house. When Rick dies, his heirs receive his share of the ownership interest. What type of co-ownership did Tom, Rick, and Harry have? - Correct Answer ️️ -tenancy in common Developer George purchased five acres of residential land on the edge of town with frontage on the main highway. When the zoning board and city council refused to rezone the property to accommodate a commercial development, George sued for the value he would have received had the land been rezoned to a higher classification. This type of legal challenge is known as - Correct Answer ️️ -inverse condemnation An owner of a condominium wishes to sell her unit. When a bad storm hit earlier in the year several units sustained wind damage to the rooftops. The homeowners association levied an assessment of $1,000 per unit for the roof repairs. Which statement is TRUE? - Correct Answer ️️ -Title cannot transfer unless the seller pays the assessment For the income approach to appraisal, debt service refers to - Correct Answer ️️ -the mortgage payments How would we see the assumption of a mortgage for $150,00 on a closing disclosure? - Correct Answer ️️ -Debit to the seller, credit to the buyer A lender takes a loan application from a potential borrower. The borrower is at the very limit of income and debt ratio requirements. The lender suggests that with an adjustable rate mortgage the buyer's initial interest rate will be 4% with a cap rate of $10%. The lender says the odds of the rate ever reaching the cap is nil to none. The buyer has just a high enough credit score to qualify and signs the mortgage contract. Has the lender done anything wrong? - Correct Answer ️️ -Yes, the lender cannot predict future rates of interest as they are driven by a free market In what type of installment agreement does the buyer make payments for the right to possession, but does NOT receive the title until most or all of the terms have been met? - Correct Answer ️️ -land contract A broker is representing buyer/client Dorothy in the search for a home. Dorothy decides to end the relationship after missing several opportunities to purchase due to the broker's unavailability to view properties at times and days convenient to her. How did this agency most likely end? - Correct Answer ️️ -revocation What type of relationship best describes how a real estate broker represents her principal in the sale of the principal's single-family home? - Correct Answer ️️ -special or specific agency Upon arrival, the listing agent dealing with an elderly lady realizes she would be happy receiving an offer for much less than market value. The agent decides to make a cash offer for the list price the seller chose. The agent then sells the property for market value. What duty has the agent breached? - Correct Answer ️️ -disclosure The listing agent is informed by the seller that the basement gets wet when it rains. The agent says nothing to the buyer. Who is liable for the failure to disclose the latent defect? - Correct Answer ️️ -seller Sue promised in the sales contract to have a new roof put on the house before closing. At the closing table, when asked about the roof, Sue said she decided not to replace the roof; she decided to reduce the sale price instead. What can the buyer do about this? - Correct Answer ️️ -the buyer can refuse to close or accept the reduced sale price, as appropriate What would cause termination of a real estate contract? - Correct Answer ️️ - completion A drunken man signed an offer to purchase. The status of the contract is - Correct Answer ️️ -voidable Which clause allows a broker to sue for a commission if the owner waits until expiration of the listing to contract with a buyer to purchase without the broker? - Correct Answer ️️ -protection Jerry owns a piece of land and worries that his neighbor may sell her vacant parcel of land to someone who may put a multi-family structure on the site. Jerry has an attorney prepare a document whereby the neighbor agrees to give Jerry the first chance to buy the lot should she decide to sell. Which would this agreement be called? - Correct Answer ️️ -right of preemption What document serves as escrow instructions? - Correct Answer ️️ -purchase agreement A legatee is a person who receives - Correct Answer ️️ -money as a gift through a will When a broker received an unexpected bill, he deposited a client's earnest money check into his personal account to cover the expense. This best describes - Correct Answer ️️ -conversion How long does a claimant have to file a complaint with the HUD Office of Equal Opportunity based on Title VIII? - Correct Answer ️️ -one year Kyle was on a showing appointment with a potential buyer who wanted to make an offer on the property. Kyle had a purchase agreement in his car. The buyer signed the offer and Kyle promised to send the buyer copies when he gets back to the office. Which statement best describes the situation? - Correct Answer ️️ -Kyle and his broker may be subject to disciplinary action You have an inactive real estate license. You and another agent in your old real estate office have decided to buy a property out of foreclosure. You will furnish the down payment and the other agent will handle the property management. What must be disclosed in the purchase contract? - Correct Answer ️️ -your licensure status Tom has his driver's license suspended for not paying a speeding ticket. The Superintendent will - Correct Answer ️️ -do nothing until notified by Ohio's Bureau of Motor Vehicles The fee to apply for a real estate broker license is - Correct Answer ️️ -$135 If a real estate broker fails to meet the deadline for submitting proof of completion of the required continuing education and her license is suspended until the CE is completed, what happens to a salesperson associated with the broker? - Correct Answer ️️ -the salesperson's license is also suspended A consumer is harmed by three licensees at the same brokerage. The judgment in favor of the consumer is $60,000 in compensatory damages. How much can be paid out of the Real Estate Recovery Fund? - Correct Answer ️️ -$60,000 Copies of contracts and listing agreements must be kept for at least three years. How long must copies of Agency Disclosure Statements be maintained? - Correct Answer ️️ -3 years A listing broker receives a commission check from the title company immediately after a transaction closes. One of the broker's agents handled the sale and is due a share of the commission check. How long can the broker delay before paying the agent? - Correct Answer ️️ -one month A brokerage operates under an approved "trade name" and it should use that name, as it appears on its license, in its advertising. Abbreviated words indicating the legal structure of the organization, such as "Inc." or "Co." are not required on the advertisement, but the advertisement must indicate that the individual or entity is a real estate broker or salesperson. What other words, though not a part of the name, does the law permit on the advertising? - Correct Answer ️️ -Independent contractor A broker posts the Fair Housing sign on the north wall of his office and posts his broker's license on the south wall of his office. What law has been violated? - Correct Answer ️️ -Ohio licensing law - mandates that a broker's license be placed in close proximity to the Fair Housing sign. Across the room would not be in close proximity. A non-interest-bearing trust account maintained by the brokerage for the purpose of depositing clients' and customers' funds - Correct Answer ️️ -may have some of the broker's own funds in it - b/c 1. keeping the account open if there are no client or customer funds on deposit, or 2. to pay any fees required by the bank. Broker Barbara let her friend, salesperson Lisa, open