CONNECTICUT REAL ESTATE PRACTICE EXAM VERIFIED ACTUAL QUESTIONS & ANSWERS FOR GUARANTEED PASS | NEWEST UPDATE

CONNECTICUT REAL ESTATE PRACTICE EXAM VERIFIED ACTUAL QUESTIONS & ANSWERS FOR GUARANTEED PASS | NEWEST UPDATE "A major difference between freehold and nonfreehold estates is that all freehold estates - CORRECT ANSWER are of indeterminable duration" "Real property can be converted to personal property by - CORRECT ANSWER Severance" "A lawsuit for inverse condemnation may be brought by - CORRECT ANSWER a homeowner" "A deed restriction is applicable to the activities of - CORRECT ANSWER present and future owners." "If conditions for purchase are included in a deed and these conditions are violated, what is the penalty? - CORRECT ANSWER Return of the property to the original owner." "The terms "littoral," "riparian," and "appropriative" refer to - CORRECT ANSWER water rights." "Which of the following BEST illustrates the concept and intent of a buffer zone? - CORRECT ANSWER Garden apartments located between a single-family residential neighborhood and a shopping center." "The FHA functions MOST like - CORRECT ANSWER an insurance company" "The purpose of usury laws is to regulate - CORRECT ANSWER interest rates charged by lenders" "Which of the following statements about discount points is FALSE? - CORRECT ANSWER They are computed as a percentage of the selling price" "A borrower has defaulted on the mortgage. The mortgage contains an acceleration clause. This permits the lender to - CORRECT ANSWER demand immediate payment of the entire note" "A loan which requires the borrower to pay interest only until the maturity date (or due date), and then to pay the entire principal on the maturity date, is called a - CORRECT ANSWER term loan" "An example of a fiduciary relationship is one which exists between the listing broker and - CORRECT ANSWER her client" "A broker has brought a ready, willing, and able buyer to a seller. In MOST listing contracts, the broker has earned his commission when - CORRECT ANSWER the seller accepts the offer" "One common method for controlling the problems created by conflict of interest in dual representation is - CORRECT ANSWER allowing a broker to designate separate salespeople within the company as legal representatives of each of the clients." "The day after a broker's listing on a house expired, it was listed with another broker and offered in the MLS. Several days later, a third licensee called the first broker and asked for the key to show the home. The broker should inform the caller that - CORRECT ANSWER he is no longer the listing agent" "When a principal authorizes an agent to perform a particular act or transaction, it is an example of a - CORRECT ANSWER special agency" "A broker supplies the financing for a project to build condominiums with the stipulation that he has the exclusive right to sell the completed condos. Which of the following BEST describes this relationship? - CORRECT ANSWER Agency coupled with an interest." "At the time of listing, the seller tells the listing agent they are moving because the neighbor has loud parties every weekend. The agent should - CORRECT ANSWER tell potential buyers about the parties" "The Department of Housing and Urban Development estimates that most private homes built before 1978 contain potentially dangerous levels of lead. Because of this, some Federal agencies, such as FHA - CORRECT ANSWER require the buyer to acknowledge disclosure of the presence of any known lead paint" "A buyer was negotiating the purchase of a house for himself. During a conversation with the seller, the seller agreed to include all kitchen appliances in the sale, and this fact was included in the sales contract. In this situation, if the seller takes the appliances with him, what recourse does the buyer have? - CORRECT ANSWER The buyer may sue the seller for specific performance" "The document used in a real estate sale that establishes the legal rights of the buyer and seller is the - CORRECT ANSWER purchase contract" "While an agent is showing a listed property, the seller and the buyer enter into an oral agreement for the purchase of the home. If a dispute over the terms arises later, the agreement may be unenforceable because - CORRECT ANSWER the agreement does not comply with the Statute of Frauds" "A written agreement in which a purchaser agrees to buy and a seller agrees to sell is called - CORRECT ANSWER a contract" "The purpose of requiring an earnest money deposit in a real estate sales contract is to - CORRECT ANSWER provide evidence of the buyer's intention to carry out the contract" "Prospective buyers made an offer on a property. The seller did NOT accept, but made a counteroffer. The prospective buyers signed the counteroffer and the real estate agent delivered their acceptance to the seller. In the interim, the same buyers had found another house that they liked better and made an offer on it, which was accepted. Which of the following is TRUE? - CORRECT ANSWER Both contracts are valid" "A prospective buyer made an offer to purchase a property. The owner responded with a counteroffer. While the buyer was reviewing the counteroffer, the owner received a better offer. The owner can accept the second offer if - CORRECT ANSWER the owner withdraws the counteroffer before it is accepted" "The real estate contract for a specific property for use as an unlicensed whiskey sales operation was forced to terminate. The termination was the result of - CORRECT ANSWER impossibility of performance." "A contract has been drawn which obliges the sellers to convey title to their land to the buyers if the buyers come up with $22,000 on or before December 31st. This is called - CORRECT ANSWER an option contract" "A charge of violation of Federal Fair Housing laws can be heard by an administrative law judge within the Department of Housing and Urban Development (HUD) or by a Federal district court judge in Federal court. The advantage of a Federal court hearing to the complaining party is that - CORRECT ANSWER there is no dollar limit on damages paid" "When is racial discrimination in the rental of rooms or apartments permitted? - CORRECT ANSWER Under no circumstances." "When someone has living heirs but dies without leaving a will, the estate is distributed according to the - CORRECT ANSWER statute of descent." "Earnest money should be deposited into a trust account - CORRECT ANSWER in a timely manner, according to state laws" "A property is encumbered by a first mortgage of $60,000 and a second mortgage of $23,500. The property has just been sold at a foreclosure auction to a speculating investor for $88,000. Assume that all costs of the foreclosure sale are included in these balances. Which of the following statements is FALSE regarding the distribution of funds? - CORRECT ANSWER The second mortgagee receives nothing unless he forced the foreclosure auction." "A homeowner has negotiated with a neighbor to obtain the permanent right to pass over the northern part of the neighbor's land to gain access to the river. He pays the neighbor $9,000 for the right of access and receives a deed. This is an easement - CORRECT ANSWER appurtenant" "The main difference between tenancy in common and joint tenancy is that with tenancy in common, when a co-owner dies, - CORRECT ANSWER his undivided interest passes to his heirs." "Joint tenancy - CORRECT ANSWER right An estate owned by two or more people whith equal and undivided possession. Both must purchase at same time, right of suvivorship possible." "Tenancy in common - CORRECT ANSWER Two or more owners with NO RIGHT of survivorship" "Which of the following consumers would be able to derive the most benefit from a reverse mortgage? - CORRECT ANSWER A couple in their late 60?s who need to tap their home equity to help cover their expenses but do not want to sell their house" "An agency relationship between a property owner and a property manager is usually created by - CORRECT ANSWER a management agreement" "Even after an offer has been accepted and is binding, the buyer and seller may still choose to sign mutual release papers rather than proceed to closing. Which of the following circumstances would NOT give either party a justifiable reason to insist on a mutual release? - CORRECT ANSWER The buyer finds a better property for better terms" "Which of the following real estate contracts is a service contract? - CORRECT ANSWER a listing agreement" "To what party or parties does the broker owe the fiduciary duty of care? - CORRECT ANSWER the party or parties employing the broker" "Under the common law of agency, licensees owe the broker with whom they are associated all of the following duties EXCEPT - CORRECT ANSWER indemnification" "If leased premises become unusable for the purpose state in the lease, the tenant may have the right to abandon the premises. This action is called - CORRECT ANSWER constructive eviction" "A company agrees to lease a property to be used as a gambling casino. State laws prohibit gambling. This particular contract would be legally defined as - CORRECT ANSWER void" "A broker has signed a listing contract for the sale of a home. Which of the following could make this contract voidable? - CORRECT ANSWER The seller is heavily under the influence of alcohol at the time of signing" "An example of a contract terminated due to inability to perform would be one in which the - CORRECT ANSWER seller had contracted for sale of the entire property without the knowledge or consent of the other joint tenant" "A salesperson in a branch office is sued for damages by a buyer after the salesperson misrepresents a property. Who has the ultimate responsibility for the salesperson's actions? - CORRECT ANSWER the supervising broker" "Engaging in the real estate business consists of acting for another for a fee in all of the following activities EXCEPT A: investing in real estate B: reselling a mobile home C: selling real-estate D: collecting rent for the use of real estate - CORRECT ANSWER A: investing in real estate" "you are employed by an apartment complex as a residential on-site property custodian. Part of your duties involves negotiating leases for the apartments. In this position you A) must have a salesperson license B) must have a brokers license C) are exempt from the licensing requirements if you reside at the apartment complex D) are violating the license law - CORRECT ANSWER C) are exempt from the licensing requirements if you reside at the apartment complex" "The initial salespersons license fee is presently ----, and annual renewals are ---- A) $285/$285 B) $565/$285 C) $285/$75 D) $565/$375 - CORRECT ANSWER A) $285/$285" "Which of the following is EXEMPT from the real estate licensing requirement? A) attorney at law when serving as legal counsel to a client B) Appraiser when valuing a client's property C) Associations, partnerships, corporations D) Real property securities dealers - CORRECT ANSWER A) attorney at law when serving as legal counsel to a client" "Prohibited Activities for Unlicensed Assistant - CORRECT ANSWER - Place calls requiring a license (EX) Cold calling, soliciting listings, contacting FSBO's, extending invitations to open houses** - Host open houses, home show booths... - Show property - Answer questions on consumer listings" "When a broker is working with a person but does not represent them.. - CORRECT ANSWER No agency relationship is created and the person they are working with is referred to as a CUSTOMER" "A broker owes what duties to a customer - CORRECT ANSWER The broker does not owe the customer fiduciariy duites but must deal with the customer in a honest manner" "If the agent is disloyal to the principal: - CORRECT ANSWER A. the agency agreement automatically terminates and the principal may rescind the transaction. B. the principal has the right to collect any actual damages sustained as a result of the agent's disloyalty. C. the principal has a right to recover any profits earned as a result of his agent's disloyal conduct. D. All the above are correct. D is correct" "To what extent can a broker for the seller work with a non represented potential buyer - CORRECT ANSWER The broker will not represent the buyer but can definitely work with the buyer in an effort to sell the sellers house" "The licensee may not use confidential information about the person that they represent. This information includes... - CORRECT ANSWER - income** - motivation to sell, rent or purchase** - previous offers received or made that are not a matter of public record** - expenses - Facts concerning the persons assets/liabilities" "Agency agreements with the seller are called - CORRECT ANSWER Listing agreements" "Agency agreements with the buyer are called - CORRECT ANSWER Buyer Agency Agreements" "Single Agent - CORRECT ANSWER Broker only represents one party in the transaction (either the buyer or the seller" "Dual Agent - CORRECT ANSWER When the agent is representing both principals in a transaction with their informed consent. (Also known as a limited agent.)" "For designated agency the buyer and seller must sign the - CORRECT ANSWER Dual agency/designated agency notice and consent form" "If a unrepresented person REFUSES to sign disclosure form for unrepresented party then... - CORRECT ANSWER the agent should note this refusal on the line indicated for the persons signature and attach that to the disclosure." "Subagent - CORRECT ANSWER is an agent appointed by another agent with the knowledge and consent of the principal." "Subagency in CT is not permitted without - CORRECT ANSWER the written consent of the seller Consent form must include sub agents.. - name - license number or agents appointed as subagents - a statement that the person being represented may be vicariously liable for the acts of the subagent" "Limitations on subagency does not apply to... - CORRECT ANSWER - leasing transactions - commercial purchase and sale contracts" "Only compensation not allowed in CT - CORRECT ANSWER Net amount ( broker retains all funds above a certain net to seller figure as compensation)" "An unlicensed personal assistant working for a real estate licensee is allowed to A) host an open house B) answer the phone and discuss questions about licensee's listings C) write and prepare promotional material D) show property listed with the licensee - CORRECT ANSWER C) write and prepare promotional material" "material fact - CORRECT ANSWER An important fact that may affect a buyer's decision to buy or a seller's decision to sell. Licensees must disclose facts that materially affect the value of residential property." "Non material facts include - CORRECT ANSWER - whether the property occupant has had a disease, emergency illness, or health condition - or the fact that there was death or felony on the property however a purchaser or tenant can ask for this information in writing if it is important to them" "In CT, real estate commission and compensation are.. - CORRECT ANSWER negotiable between the seller or the buyer and the broker" "tenacy in common - CORRECT ANSWER Co-ownership with NO rights to survivorship (Most common form of ownership by 2 or more people)" "Joint Tenancy - CORRECT ANSWER Co-ownership with rights to survivorship (property can be held in equal or unequal shares in CT)" "What types of properties are governed by the Common Interest Ownership Act? A) Condominiums B) Condominiums and Cooperatives C) Planned Unit developments (PUD's) D) Condominiums, Cooperatives, and Planned Unit Developments (PUD's) - CORRECT ANSWER D) Condominiums, Cooperatives, and Planned Unit Developments (PUD's)" "Which form of ownership is NOT recognized under CT Law? A) Tenancy in Common B) Joint Tenancy with survivorship rights C) Condominium D) Tenancy by the entirety - CORRECT ANSWER D) Tenancy by the entirety (Usually used in marriages) (Not used in CT) (Considered Tenancy in common)" "CT Law will allow the partition of concurrent ownership in real estate A) when it is voluntary B) When it is involuntary C) Voluntary and Involuntary D) Only on the death of the tenant in common - CORRECT ANSWER C) Voluntary and Involuntary" "The maximum fee that can be charged for Condominium resale documents is A) $75 B) $125 C) $180 D) $225 - CORRECT ANSWER B) $125" "In accordance with the electronic signature act what document legally cant be signed electronically? - CORRECT ANSWER Deeds, leases (closings can be electronic)" "The conveyance tax levied by the state on the seller of the property is based on the A) selling price B) earnest money C) amount of the mortgage D) time of the purchase - CORRECT ANSWER A) selling price" "In CT, the real property tax is essentially a (n) A) ad hoc tax B) ad valorem tax C) state tax D) title lien - CORRECT ANSWER B) ad valorem tax (based on value)" "The CT statute of frauds requires that, in order to be enforceable, all contracts for the sale of real-estate must be A) in writing B) on the correct legal form C) signed by both parties' attorneys D) witnessed and notarized - CORRECT ANSWER A) in writing" "Listing and buyer brokerage contracts are considered to be A) bilateral contracts B) implied contracts C) parol contracts D) unilateral contracts - CORRECT ANSWER A) bilateral contracts" "A purchase and sale contract signed by both the seller and the buyer A) is legally binding on the parties B) is no effect until endorsed by an attorney C) transfers the real estate identified in the contract D) must also be signed by the real estate broker involved in the transaction - CORRECT ANSWER A) is legally binding on the parties" "Property condition disclosure reports must be delivered to the buyer A) prior to the buyer's making a written offer B) at the time the buyer makes a written offer C) prior to the buyer's signing a purchase and sale contract D) at the time of the home inspection - CORRECT ANSWER A) prior to the buyer's making a written offer" "A lease must be in writing if it is in a period in excess of A) 60 days B) 90 days C) six months D) one year - CORRECT ANSWER D) one year" "All funds received by a broker on behalf of his or her client must be deposited in escrow or trust account within three A) days of receiving the deposit B) days of obtaining all signatures C) banking days of receiving all signatures D) working days of receiving all signatures - CORRECT ANSWER C) banking days of receiving all signatures" "To be valid a deed must contain all of the following EXCEPT A) the signature of the grantor B) the signature of the grantee C) the signature of the witness D) an acknowledgement - CORRECT ANSWER B) the signature of the grantee" "Lead inspections are required under which three circumstances - CORRECT ANSWER 1) When child (under 6 y/o) has been diagnosed with an elevated blood lead level, that child's dwelling must be inspected 2) If the child with the elevated blood lead level lives in a multifamily building, other dwelling units must be inspected 3) all day care centers must be inspected prior to licensure and relicensure" "If lead inspection comes back positive for elevated lead levels will the seller have to pay to get it removed? - CORRECT ANSWER Yes" "CT licensing law recognizes following listing agreements: A) Exclusive right to sell, Exclusive agency, open listings B) Exclusive right to sell, Exclusive agency, open listings, MLS C) Exclusive right to sell, Exclusive agency, open listings, net listing D) Exclusive right to sell, Exclusive agency, open listings, Net listing, MLS - CORRECT ANSWER A) Exclusive right to sell, Exclusive agency, open listings" "Resale documents must be furnished to the buyer or his or her attorney before the closing or transfer of possession. The buyers right to cancel a purchase contract is how many days after the resale documents have been hand delivered? A) 10 business days B) 15 business days C) 5 business days D) 14 business days - CORRECT ANSWER C) 5 business days" "Sellers can obtain condominium resale disclosure documents from A) the secretary if states office B) the property manager C) the association D) the CT Real Estate Commission - CORRECT ANSWER C) the association" "Questions about boundaries in CT are resolved by A) The superior court B) The superior court witht he appointment of a committee C) The superior court, a committee, and possible a land surveyor D) a committee - CORRECT ANSWER C) The superior court, a committee, and possible a land surveyor" "Real property taxes are ad valorem taxes levied by A) the federal government B) the state C) local municipalities D) the assessor - CORRECT ANSWER C) local municipalities" "The state requires the values placed on all properties be based on their A) assessed value B) intrinsic value C) ad valorem value D) Market value - CORRECT ANSWER D) Market value" "CT Statues generally hold tax liens to a ----- year maximum. To be valid, tax liens must be recorded by the agency levying the tax within 2 years form the due date. A) 2 B) 4 C) 10 D) 15 - CORRECT ANSWER D) 15" "Real estate contracts must contain the basic legal elements to be enforceable. These include legally competent parties, offer and acceptance, and A) no consideration B) a minimum of 5% down C) Equal consideration D) Valid consideration - CORRECT ANSWER D) Valid consideration" "Recording of documents affecting the title of real estate gives A) Active notice B) actual notice C) permanent notice D) Constructive Notice - CORRECT ANSWER D) Constructive Notice" “Two lots of the same size are sold on a street. The lot on the corner sells for $20,000 more than the lot in the middle of the street. Which of the following characteristics MOST likely explains the price difference? - CORRECT ANSWER Situs" "How does a creditor who has obtained a judgment get satisfaction against a debtor who will not pay? - CORRECT ANSWER Writ of execution" "What type of map is MOST useful for describing the terrain of a very hilly lot? - CORRECT ANSWER Contour map" "A tenant rented an apartment, signing a 15-month lease. After the lease expired, the tenant paid 1 month's rent and got a receipt. What kind of leasehold does the tenant have? - CORRECT ANSWER Tenancy at will" "A property owner died, having willed his real property to his two daughters. There is still a chance that they could lose the land for a variety of reasons, but it CANNOT be taken through - CORRECT ANSWER escheat" "An environmental impact statement typically describes the effects of a proposed project on factors such as - CORRECT ANSWER public health and safety" "All of the following are methods to calculate the reproduction or replacement cost of a building EXCEPT the - CORRECT ANSWER straight-line method" "Which of the following approaches MOST reliably estimates the sales price of a single-family residence? - CORRECT ANSWER Market data" "A formal appraisal will ALWAYS be REQUIRED when the - CORRECT ANSWER lender wants to sell the mortgage to the secondary market." "According to the principle of progression, a three-bedroom, one-story home is MOST likely to bring the highest sales price if located in a neighborhood in which - CORRECT ANSWER most homes are larger than the sale home." "An appraiser MUST be licensed or certified to handle Federally related work on residential property valued at more than - CORRECT ANSWER $250,000" "A competitive market analysis is MOST often used for - CORRECT ANSWER setting a listing price" "Which rule-of-thumb version is being offered to an investor who is told that a house renting for $900 a month should sell for about $90,000? - CORRECT ANSWER GRM" "When a property owner uses his home as collateral for a loan and creates a lien in favor of the lender, title is held by the - CORRECT ANSWER mortgagor" "When the sellers are lending part of the purchase price, they may secure the debt either with a deed of trust or a mortgage. For the seller, one benefit of the deed of trust is that - CORRECT ANSWER foreclosure is usually simpler and faster" "Regulation Z requires that the borrower be fully informed of all of the following EXCEPT - CORRECT ANSWER the total interest" "A broker, acting as agent for the seller, presents an offer to buy from the broker's former college roommate. The broker knows that the buyer will increase the amount of the offer if the seller turns down the offer. When presenting the offer, the broker should - CORRECT ANSWER tell the seller that the buyer will pay more" "During the listing presentation, the seller questions the amount of commission to be paid and is told - CORRECT ANSWER the amount of commission is negotiable" "Which of the following events would AUTOMATICALLY cancel a listing agreement? - CORRECT ANSWER Property owner's death" "Under the terms of their listing contract, the owners may sell their house themselves and pay no commission. If their agent sells it, a commission will be due. What kind of listing contract do the owners have? - CORRECT ANSWER Exclusive agency listing" "A seller tells the listing agent that her home was treated for termites 10 years ago, so there are no termites now. Before listing the property, the agent should - CORRECT ANSWER tell the seller to disclose the termite treatment on the property disclosure." "Which of the following is the first action to take when mold problems are found? - CORRECT ANSWER Identify and remedy the cause of the problems" "Without checking the facts, a broker who is the seller's agent tells a buyer that the property taxes in a particular neighborhood are among the lowest in the area. The buyer relies on the broker's statement and makes an offer on a house in the neighborhood. Before closing, it is determined that the taxes are actually among the highest in the area. The buyer could seek to rescind the contract on the basis of - CORRECT ANSWER misrepresentation" "The real estate broker who is listing a house for sale should personally verify - CORRECT ANSWER the number of square feet in the building" "A couple signed a lease on an apartment for a period of 1 year. The lease does NOT contain an automatic renewal clause. The couple plans to move out at the end of the lease rather than renew it. How much notice MUST they give to comply with the lease term? - CORRECT ANSWER No notice is required." "For Federal income tax purposes, which of the following are costs of homeownership that may be deducted from gross income? - CORRECT ANSWER Mortgage loan interest, local property taxes, mortgage loan origination fees" "A judgment has been properly recorded. Any subsequent purchasers, whether they have actually examined the record or not, have been given - CORRECT ANSWER constructive notice" "At the closing on June 15, the buyer is assuming a mortgage presently on the property, on which the monthly interest charge is currently $600. The seller has made the payment due on June 1. Assuming a VA mortgage, what is the adjustment made at closing? - CORRECT ANSWER Debit seller $300; credit buyer $300." "Under a land contract for deed, who retains fee ownership of the property? - CORRECT ANSWER Vendor" "The buyer is assuming a mortgage presently on the property in the amount of $110,000. What is the adjustment made at closing? - CORRECT ANSWER Credit buyer $110,000; debit seller $110,000" "The escrow officer or closing agent MUST give information regarding the sales price and seller's social security number to - CORRECT ANSWER IRS" "A managing broker can be held responsible for - CORRECT ANSWER all real estate activities of salespersons" "According to the Truth-in-Lending Act, if any "trigger terms" are used in an ad, all of the following disclosures MUST appear in the ad EXCEPT the - CORRECT ANSWER prepayment penalties and rebates" "The statement "this property has the most beautiful views in the neighborhood" is an example of - CORRECT ANSWER puffing" "An equal housing opportunity notice MUST be - CORRECT ANSWER displayed in the brokerage office." "The buyer wants to make the purchase offer contingent on a complex mortgage arrangement. The buyer's agent who is drawing up the contract should - CORRECT ANSWER suggest the buyer ask a lawyer to furnish the wording" "Antitrust laws prohibit competing brokers from all of the following EXCEPT - CORRECT ANSWER receiving compensation from both the buyer and the seller" "An agent shows a home to a couple and mentions that it has a lovely fireplace in the living room. After buying the home, the buyers and agent discover that the brick fireplace is just a decorative fireplace and is not "wood burning." Which of the following would BEST protect the agent from financial loss? - CORRECT ANSWER E & O coverage." "An owner lists her home at a 7% commission rate and wants to net $45,000 after paying the mortgage balance of $68,000 and the broker's commission. To the nearest dollar, what should the selling price be to net her $45,000? - CORRECT ANSWER $110,753" "Two buyers bought a house with a $178,000 mortgage. The interest rate is 6 1/2% per annum payable for 30 years. To the nearest dollar, what is their monthly principal and interest payment? (BE SURE TO USE THE AMORTIZATION TABLE.) - CORRECT ANSWER $1,125" "If a borrower can afford to make monthly principal and interest payments of $1,000 and the lender will make a 30-year loan at 8-1/2%, how large a loan (rounded to the nearest $100) can this buyer afford? (BE SURE TO USE THE AMORTIZATION TABLE.) - CORRECT ANSWER $130,000" "On January 15, a seller paid $960 in annual property tax for the current calendar year. A buyer is purchasing the house with the closing set for March 1. What will be the seller's credit for the property taxes already paid if the buyer pays for the day of closing? Use a 360-day year and a 30-day month. - CORRECT ANSWER $800" "The sellers have agreed to give the buyers an allowance to recarpet the living room. They will allow $22.95 per square yard for carpet plus $6.00 per square yard for pad and installation. If the living room is 21 feet x 12 feet, how much will it cost the sellers (to the nearest cent)? - CORRECT ANSWER $810.60" "Too much leverage may result in - CORRECT ANSWER negative cash flow" "A major reason for buying and owning a condominium rather than a detached single-family home is that - CORRECT ANSWER a condominium tends to be more affordable" "Ownership of common stock in a corporation gives - CORRECT ANSWER an interest that is classified as personal property" "A homeowner is willing to let his neighbor park an RV in his backyard. He does NOT want to make the permission permanent in case he dislikes others who might move next door in the future. What should he give his neighbor? - CORRECT ANSWER A license" "Three people buy a house as tenants in common. Subsequently, two of the owners want to sell, but the third discourages each potential purchaser. The two owners who wish to sell the house can - CORRECT ANSWER file an action for partition against the third owner" "Although states make specific laws governing water rights and the rights in land that borders water, most states generally follow one of two basic doctrines regarding water rights. In many states, the common law doctrine of riparian and littoral rights dictates that water rights are automatically conveyed with property. In others, all water rights are controlled by the state under the doctrine of - CORRECT ANSWER prior appropriation" "Legal descriptions using the government survey system are NOT generally used in - CORRECT ANSWER the original 13 states" "A landowner wishes to build a neighborhood grocery store on a busy street in an area zoned for residential use. Which of the following would MOST likely be used to obtain permission for this store? - CORRECT ANSWER Conditional use permit or zoning variance." "Building codes are - CORRECT ANSWER ordinances that specify construction standards" "A deed restriction is applicable to the activities of - CORRECT ANSWER all owners, present and future" "An escheat occurs when - CORRECT ANSWER a property owner dies without heirs or a valid will" "An Environmental Impact Statement (EIS) - CORRECT ANSWER projects the impact on the environment of a proposed project" "A couple owns an older home in a neighborhood that is becoming a commercial area. Because of the change in the use of the land, the couple can expect the value of their parcel to increase at some future time. This is an example of the principle of - CORRECT ANSWER anticipation" "A competitive market analysis takes into consideration - CORRECT ANSWER square footage of the subject property" "If all other factors are equal, in which location is a parking lot likely to bring the highest sales price? - CORRECT ANSWER Business district zoned for a six-story office building" "When preparing a market data estimate of value, which of the following categories of adjustment is NOT essential? - CORRECT ANSWER The original cost of the building" "A prospective seller asks a salesperson to recommend a listing price for a property. The salesperson should suggest - CORRECT ANSWER a competitive market analysis to determine the property's value" "Federal Truth-in-Lending laws are also known as - CORRECT ANSWER Regulation Z" "In helping a buyer to select a lender, if the buyer believes he has good credit and his income is documentable as a salary and by tax returns, the licensee might recommend a mortgage banker, instead of a mortgage broker, for all of the following reasons EXCEPT - CORRECT ANSWER more variety of loan programs available" "A real estate salesperson is representing only the buyer in a transaction. Which of the following actions would be a violation of the salesperson's agency duties to the client? - CORRECT ANSWER disclosing the highest price the buyer is willing to pay" "A salesperson lists a property with a contract that allows for subagency and dual agency. The salesperson is - CORRECT ANSWER an agent to the broker and a subagent to the principal" "A realty firm has just entered into an agreement to represent a home builder in the sale of a new subdivision. The firm has located several potential buyers and five homes have been sold to purchasers that the firm's agents have contacted. The realty firm has an agency relationship with - CORRECT ANSWER the builder" "State laws differ on whether a buyer is entitled to know about - CORRECT ANSWER a suicide that occurred in the house last year" "Unrepresented buyers ask the licensee who listed the home whether they should order a property inspection as a part of their due diligence for the purchase of the home. Which of the following would be the most appropriate way for the listing agent to respond? - CORRECT ANSWER If you feel it is in your best interest, please do so." "The Department of Housing and Urban Development estimates that most private homes built before 1978 contain potentially dangerous levels of lead. Because of this, some Federal agencies, such as FHA, - CORRECT ANSWER require the buyer to acknowledge disclosure of the presence of any known lead paint" "A seller's statement in a property disclosure document means - CORRECT ANSWER the owner is disclosing known latent defects." "A licensee is listing a property in a known flood plain. The seller flatly denies that the structure and the property have ever been flooded. What is the licensee required to do in this situation? - CORRECT ANSWER Inform the seller of the legal obligation to disclose facts regarding flood plains" "What is the duration of a home warranty's coverage? - CORRECT ANSWER as disclosed in the contract that offers the warranty" "What critical aspect of the property inspection process MUST licensees convey to prospective buyers? - CORRECT ANSWER Need for inspections to be completed within the time stated in the contract." "A contract has been drawn which obliges the sellers to convey title to their land to the buyers if the buyers come up with $22,000 on or before December 31st. This is called - CORRECT ANSWER an option contract" "When a listing broker is preparing an Offer to Purchase for a buyer customer, contingencies involving inspections or approval by a third party should - CORRECT ANSWER have short deadlines" "In an exclusive right-to-sell listing, an owner lists the property for sale with how many brokers? - CORRECT ANSWER One" "A licensee has an agency representation agreement with a buyer. When showing another company's listing, what obligation does the licensee have to the seller and the listing broker at the other company? - CORRECT ANSWER Disclose the agency relationship when arranging the showing and disclose material information about the buyer if presenting an offer" "A minority couple come to a salesperson looking for a house. The salesperson has some properties for which the couple qualify but avoids showing or mentioning these listings. Instead, the salesperson shows only properties in low-priced and integrated neighborhoods. This practice is known as - CORRECT ANSWER steering" "Which of the following services can be provided by a real estate salesperson? - CORRECT ANSWER competitive market analyses" "Salesperson Susan was at the local coffee shop with some agents from other offices. The subject of commissions came up, and agents began to compare their commission rates. Susan should - CORRECT ANSWER advise her friends this could constitute a violation of Sherman Antitrust Act." "Failure of a real estate agent to comply with Fair Housing practices is punishable by - CORRECT ANSWER license revocation and criminal prosecution." "Under the Federal Fair Housing Law, which of the following is considered discriminatory advertising? - CORRECT ANSWER "Catholics preferred."" "Which restrictive covenant would be considered illegal? - CORRECT ANSWER A covenant that restricts selected parcels within a defined subdivision." "A property management plan may serve different purposes for different owners, and generally has to strike a balance between preservation of the property's value and generation of income. Which of the following owners would MOST likely prefer a property manager who emphasizes cash flow or income over the maintenance of value? - CORRECT ANSWER An individual entrepreneur who owns several apartment buildings." "MOST closed real estate transactions should be reported to the IRS. REQUIRED information includes seller name(s) and social security number(s) and - CORRECT ANSWER the sale price." "An exception to title insurance coverage is - CORRECT ANSWER defects that clearly appear in the title search." "To be valid, every deed must - CORRECT ANSWER be executed by the grantor." "In MOST states, foreclosed property is sold through - CORRECT ANSWER public auction." Connecticut Real Estate Commissions primary duties: - CORRECT ANSWER 1) issue licenses 2) arbitrates disputes between brokers and salespersons 3) investigates and prosecutes complaints against licensees 4) formulate and enforce rules and regulations regarding licensing and conduct of licensing" "How is the CT Real Estate Commision made up? - CORRECT ANSWER eight members - five in the real estate business (3 brokers and 2 salespersons) and three members of the public (at least 1 member from each congressional district and not more than the bare majority from the same political party)" "To be a member of the CT Real Estate Commission you must.. - CORRECT ANSWER 1) electors in the state 2) appointed by the governor 3) take an oath to perform faithfully to prescribed duties 4) may be removed from the office for a cause by the governor after being given an opportunity to be heard" "The CT Real Estate Commission chairman must.. - CORRECT ANSWER be bonded in accordance with the requirements of the state insurance purchasing board." "Are CT Real Estate Commission members paid for their services? - CORRECT ANSWER NO, but they are reimbursed for necessary expenses incurred in the performance of their duties" "Ben broker maintains the website that highlights all of the property listings that he has. Ben knows that the licensing law requires that he include certain information on this website, including the certain information on this website, including the A) address of all properties listed B) sellers contact information for all of the properties listed C) last date when bennshoed any of the properties listed D) last date when the website property information was updated. - CORRECT ANSWER D) last date when the website property information was updated." "Who may receive compensation form the Real Estate Guaranty Fund? A) A broker who does not receive an earned commision B) A seller who pays a commission to a broker under false pretenses C) A buyer who pays a fee to a broker under a buyer agency agreement D) A cooperating broker who does not receive a commission split - CORRECT ANSWER B) A seller who pays a commission to a broker under false pretenses" "to change broker affiliation, a salesperson must - CORRECT ANSWER Register the change with the commission" "A saleswoman regularly communicates with all of her clients and potential claims via email. The licensing law requires that her email contains all of the following EXCEPT - CORRECT ANSWER CORRECT ANSWER: her license certificate number Should include her 1) name and office address 2) the name of the broker she is affiliated with 3) all of the states where she licensed" "Duel Agency - CORRECT ANSWER 1) Both clients must give written formal consent 2) In this situation all salespersons working for the broker are also duel agents" "Designated Agency - CORRECT ANSWER A process that accommodates an in-house sale in which two different agents are involved. The broker designates one agent to represent the seller and one agent to represent the buyer." "Agency Relationship - CORRECT ANSWER Fiduciary relationship (relationship of trust) in which agent acts on behalf of principal" "Real Estate Broker - CORRECT ANSWER A person licensed to arrange for the purchase and sale of real estate for a fee or commission. 1) lists for sale 2) sells 3) buys 4) exchanges 5) rents or collects rent for the use of 6) resells a mobile home" "Real Estate Salesperson - CORRECT ANSWER A person employed by a broker to list, negotiate, sell, or lease real property for others." "Agency Agreement - CORRECT ANSWER the agreement between principal and agent whereby the agent undertakes to act on behalf of the principal" "The broker that the salesperson is affiliated with is referred to as.. - CORRECT ANSWER the sales person's "designated" or "sponsoring" broker" "The "designated" broker is responsible for... - CORRECT ANSWER liability incurred by the sales person while performing real estate brokerage activities" "Allowed Activities for Unlicensed Assistant - CORRECT ANSWER - Answer the phone and forward calls to the licensee** - record/deposit earnest money and other trust funds** - Assemble documents for closing** - Transmit listings and changes to MLS - Follow up on loan commitments after the contract has been negotiated - Secure public documents from the town hall (Sewer water taxes...)"