Rockwell Cram Exam #1 UPDATED
ACTUAL Questions and CORRECT
Answers
Jesse, Kim, and Diane own a home together as joint tenants. If Jesse dies, her property interest: -
CORRECT ANSWER - will be automatically transferred (conveyed) to Kim and Diane
Frank gives Stella an option to buy his house. Stella, as the optionee, is obligated to: -
CORRECT ANSWER - pay consideration for the option right
A corn field with a depth of 900 feet and a frontage of 484 feet is bisected by an access road,
leaving two triangular lots. If the land sells for $2,000 per acre, how much is each lot worth? -
CORRECT ANSWER - $10,000
Martha gave Hannah the right to purchase her vacant lot for $65,000. Hannah paid Martha
$1,200 for this right. Hannah is the: - CORRECT ANSWER - optionee
Ajax Realty lists a property for a seller at a commission rate of 8%. The multiple listing service
provides that a listing brokerage will split commissions at a 50-50 rate. Baron Realty, a
cooperating brokerage, finds a buyer for the property, at a price of $300,000. How much will the
seller owe Ajax Realty at closing? - CORRECT ANSWER - $24,000
A buyer enters into a buyer agency agreement with a real estate licensee to negotiate the
purchase of a particular FSBO property. The buyer then enters into a purchase and sale
agreement, but the property he agreed to buy is subsequently condemned. Which of the
following is true? - CORRECT ANSWER - The agency is terminated
A right held by one or more persons to use and possess property to the exclusion of others is
a/an: - CORRECT ANSWER - fee simple estate
A new subdivision requires payment of homeowners association dues. If unpaid, what type of
lien do they create? - CORRECT ANSWER - Specific lien that encumbers the property
, 21. Interest on a loan for a home purchase is which type of interest? - CORRECT
ANSWER - Simple
Which of the following is a primary market lender? - CORRECT ANSWER - Mortgage
banking company
Which of the following rental transactions would be covered by (not exempt from) the Fair
Housing Act even if no real estate agent were involved? - CORRECT ANSWER - Rental
of a unit in a triplex, using no discriminatory advertising
A living room needs to be re-carpeted. It measures 18 feet long by 15 feet wide. How many
square yards of carpet will need to be purchased? - CORRECT ANSWER - 30
A writ of attachment, an easement in gross, and a special assessment all have what in common? -
CORRECT ANSWER - They're encumbrances
A potential buyer gives a seller an offer that doesn't meet the seller's demands in the listing.
What has the buyer given? - CORRECT ANSWER - Offer to purchase
Which of the following clauses relates to a mortgage loan default and requires immediate
payment of the debt? - CORRECT ANSWER - Acceleration clause
B purchases a small commercial property, and he finances it with a 65% loan. The lender charges
9.25% annual interest and three discount points. The discount points: - CORRECT
ANSWER - increase the lender's upfront yield
Which of the following statements regarding the Real Estate Settlement Procedures Act
(RESPA) is true? - CORRECT ANSWER - The borrower is entitled to a good faith
estimate of the settlement costs within three days of submitting an application
ACTUAL Questions and CORRECT
Answers
Jesse, Kim, and Diane own a home together as joint tenants. If Jesse dies, her property interest: -
CORRECT ANSWER - will be automatically transferred (conveyed) to Kim and Diane
Frank gives Stella an option to buy his house. Stella, as the optionee, is obligated to: -
CORRECT ANSWER - pay consideration for the option right
A corn field with a depth of 900 feet and a frontage of 484 feet is bisected by an access road,
leaving two triangular lots. If the land sells for $2,000 per acre, how much is each lot worth? -
CORRECT ANSWER - $10,000
Martha gave Hannah the right to purchase her vacant lot for $65,000. Hannah paid Martha
$1,200 for this right. Hannah is the: - CORRECT ANSWER - optionee
Ajax Realty lists a property for a seller at a commission rate of 8%. The multiple listing service
provides that a listing brokerage will split commissions at a 50-50 rate. Baron Realty, a
cooperating brokerage, finds a buyer for the property, at a price of $300,000. How much will the
seller owe Ajax Realty at closing? - CORRECT ANSWER - $24,000
A buyer enters into a buyer agency agreement with a real estate licensee to negotiate the
purchase of a particular FSBO property. The buyer then enters into a purchase and sale
agreement, but the property he agreed to buy is subsequently condemned. Which of the
following is true? - CORRECT ANSWER - The agency is terminated
A right held by one or more persons to use and possess property to the exclusion of others is
a/an: - CORRECT ANSWER - fee simple estate
A new subdivision requires payment of homeowners association dues. If unpaid, what type of
lien do they create? - CORRECT ANSWER - Specific lien that encumbers the property
, 21. Interest on a loan for a home purchase is which type of interest? - CORRECT
ANSWER - Simple
Which of the following is a primary market lender? - CORRECT ANSWER - Mortgage
banking company
Which of the following rental transactions would be covered by (not exempt from) the Fair
Housing Act even if no real estate agent were involved? - CORRECT ANSWER - Rental
of a unit in a triplex, using no discriminatory advertising
A living room needs to be re-carpeted. It measures 18 feet long by 15 feet wide. How many
square yards of carpet will need to be purchased? - CORRECT ANSWER - 30
A writ of attachment, an easement in gross, and a special assessment all have what in common? -
CORRECT ANSWER - They're encumbrances
A potential buyer gives a seller an offer that doesn't meet the seller's demands in the listing.
What has the buyer given? - CORRECT ANSWER - Offer to purchase
Which of the following clauses relates to a mortgage loan default and requires immediate
payment of the debt? - CORRECT ANSWER - Acceleration clause
B purchases a small commercial property, and he finances it with a 65% loan. The lender charges
9.25% annual interest and three discount points. The discount points: - CORRECT
ANSWER - increase the lender's upfront yield
Which of the following statements regarding the Real Estate Settlement Procedures Act
(RESPA) is true? - CORRECT ANSWER - The borrower is entitled to a good faith
estimate of the settlement costs within three days of submitting an application
