REAL ESTATE NATIONAL EXAM POST TEST QUESTIONS WITH 100% CORRECT ANSWERS

REAL ESTATE NATIONAL EXAM POST TEST QUESTIONS WITH 100% CORRECT ANSWERS "Question #1 of 80 Question ID: 1425578 When does title transfer? A) When the grantor delivers a valid deed to the grantee B) When both the grantor and the grantee have signed a valid deed C) When the grantee accepts a valid deed from the grantor D) When the grantor executes a valid deed to the grantee - CORRECT ANSWER C) When the grantee accepts a valid deed from the grantor" "Question #2 of 80 Question ID: 1425563 All of these are characteristics of land EXCEPT A) land is movable. B) land is considered real property. C) land does not depreciate. D) land is (theoretically) indestructible. - CORRECT ANSWER A) land is movable." "Question #3 of 80 Question ID: 1425566 A buyer purchased a home subject to an easement in gross over the west 10 feet of the property. The easement was for public utilities. Who owns the property subject to this particular easement? A) The city B) The public utilities company C) The buyer and the public utilities company together D) The buyer - CORRECT ANSWER D) The buyer" "Question #4 of 80 Question ID: 1425611 A homeowner promised to pay $50 if a local wood expert restored the homeowner's teak patio furniture. The expert arrived and restored the teak patio furniture competently. This is an example of which of these? A) A unilateral contract B) A voidable contract C) A bilateral contract D) An implied contract - CORRECT ANSWER A) A unilateral contract" "Question #5 of 80 Question ID: 1425594 A seller's agent would be obligated to share with an unrepresented customer that A) all information the customer shares with the agent will also become knowledge of the agent's principal. B) the seller is getting a divorce and is very motivated. C) the property is overpriced and the buyer should offer less than the listing price. D) the property was the site of an accidental death two years ago. - CORRECT ANSWER A) all information the customer shares with the agent will also become knowledge of the agent's principal." "Question #6 of 80 Question ID: 1425596 An investor hired a property manager with a real estate license to manage an apartment building, and the two parties entered into a written property management agreement. The property manager advised the rental property owner about several needed repairs to the residential apartment units. The property manager also found and signed several tenants. Finally, the property manager compared the rents charged at the investor's property with several other nearby apartment buildings. This type of agency is called what? A) Implied agency B) General agency C) Secret agency D) Special agency - CORRECT ANSWER B) General agency" "Question #7 of 80 Question ID: 1425567 Upon reviewing the title commitment, the broker finds out that the property has two mortgage liens, a judgment lien, an IRS income tax lien, and a lien for unpaid property taxes. The lien that will take priority over all the others is the A) judgment lien. B) property tax lien. C) first mortgage. D) IRS income tax lien. - CORRECT ANSWER B) property tax lien." "Question #8 of 80 Question ID: 1425571 An owner conveyed a property to the city for as long as the property was used as a park. Twenty-six years later, the city decided to build a new city hall on the property. Which of these is the MOST likely outcome of this decision? A) Nothing. Land use is subject to the government's police power. B) Title to the property will revert to the original grantor or the original grantor's heirs C) Nothing. The city can exercise its power of eminent domain. D) Nothing. A condition expires after 25 years. - CORRECT ANSWER B) Title to the property will revert to the original grantor or the original grantor's heirs" "Question #9 of 80 Question ID: 1425601 Which of the following actions by a listing broker would be considered unethical? A) Inflating the likely sales price of a property in order to obtain the listing and expecting to convince the seller to lower the price later B) Refusing a listing because the seller's desired sales price significantly exceeds the broker's estimate of market value C) Declining to reveal the seller's motivation and desired time frame for selling the property to a buyer's agent D) Informing unrepresented buyers who come to an open house that they should be aware of agency issues before discussing their confidential financial qualifications - CORRECT ANSWER A) Inflating the likely sales price of a property in order to obtain the listing and expecting to convince the seller to lower the price later" "Question #10 of 80 Question ID: 1425582 To widen a busy two-lane highway, a state must exercise its power of eminent domain to acquire privately owned real estate for all of these EXCEPT A) a property that recently went through a foreclosure. B) a property subject to local property taxes. C) a property that had permanently escheated to the state. D) a property that is owned by a government official. - CORRECT ANSWER C) a property that had permanently escheated to the state." "Question #11 of 80 Question ID: 1425608 A seller decides NOT to sell a property despite of having an executory contract with a buyer. The buyer's remedy is to A) amend the contract and change the terms to get the buyer's earnest money returned. B) sue for liquidated damages to recover the earnest money and force the seller to sell. C) file criminal charges to void the agreement. D) sue the seller for specific performance to force compliance with the agreement. - CORRECT ANSWER D) sue the seller for specific performance to force compliance with the agreement." "Question #12 of 80 Question ID: 1425633 In the government (rectangular) survey system legal description method, a township is divided into 36 sections. Which of these is the formula for calculating the area of one section of a township? A) 5,280 × 5,280 = B) 1,320 × 1,320 = C) 8,640 × 8,640 = D) 2,640 × 2,640 = - CORRECT ANSWER A) 5,280 × 5,280 = A mile is 5,280 feet. To calculate the area of a square mile, multiply 5,280 (height) × 5,280 (width). Reference: Real Estate Calculations > Measurement" "Question #13 of 80 Question ID: 1425603 Which of the following advertisements for the sale of real estate is legal when the agent is an owner of the property? A) A commercial office building, list price 3 million, fully leased B) A single-family residence, list price $1 million, convenient location C) Agricultural property, list price $2 million, great crop land D) Apartment building, list price $2.5 million, owner agent - CORRECT ANSWER D) Apartment building, list price $2.5 million, owner agent" "Question #14 of 80 Question ID: 1425574 Jordan purchased a parcel of real estate from Anne and Terry, who owned the property as tenants in common. When Jordan takes title to the real estate at closing, what form of ownership will Jordan have of the real estate? A) Jordan is the sole owner and has an estate in severalty ownership of property. B) Jordan has a concurrent ownership of the real estate. C) Jordan has a tenancy in common ownership of the property. D) Jordan owns the property in joint tenancy. - CORRECT ANSWER A) Jordan is the sole owner and has an estate in severalty ownership of property." "Question #15 of 80 Question ID: 1425622 All of these are comparable to the market data approach EXCEPT A) the income approach. B) the broker's price opinion. C) the broker opinion of value. D) the comparative market analysis. - CORRECT ANSWER A) the income approach." "Question #16 of 80 Question ID: 1425623 Which of these formulas correctly states the formula need for capitalization? A) Net operating income ÷ rent = value B) Rate ÷ value = net operating income C) Value ÷ rate = net operating income D) Rate × value = net operating income - CORRECT ANSWER D) Rate × value = net operating income" "Question #17 of 80 Question ID: 1425630 The TILA-RESPA Integrated Disclosure (TRID) requires creditors to provide meaningful disclosures to consumers—specifically, a Loan Estimate (LE) and a Closing Disclosure (CD). When must these disclosures be made? A) LE at least three days before closing; CD within three days of loan application B) LE within 10 days of loan application; CD at least 5 days before closing C) LE no later than the date of the loan application; CD no later than the closing date D) LE within three days of loan application; CD at least three days before closing - CORRECT ANSWER D) LE within three days of loan application; CD at least three days before closing" "Question #18 of 80 Question ID: 1425585 A single-family residence was built in 1965 and the owner wishes to sell the property. Which of the following is TRUE regarding laws regulating lead-based paints? A) Since the home was built before 1978, the seller must have a lead inspection done before signing a purchase agreement. B) Lead-based paints are not considered a material fact and therefore not required to be disclosed. C) The seller must abate all lead in the home before listing the property. D) The prospective purchaser has a 10-day right to have the property inspected for lead. - CORRECT ANSWER D) The prospective purchaser has a 10-day right to have the property inspected for lead." "Question #19 of 80 Question ID: 1425592 A real estate broker and owner of a duplex entered into an exclusive-right-to-sell listing agreement for a term of six months. Shortly after the property was listed, the broker found a buyer, the seller signed the purchase agreement, and the transaction closed within two months of entering into the listing agreement. What is the status of the listing agreement after closing? A) Continues until the expiration of the six-month term B) Executed C) Executory D) Ended upon seller paying the listing broker's commission - CORRECT ANSWER B) Executed" "Question #20 of 80 Question ID: 1425613 A single-family residence was listed for sale. A buyer entered into a purchase contract with a seller, contingent on the ability to build a treehouse in the backyard. Upon further investigation, the buyer discovered the community association's CC&Rs prohibited backyard and front yard treehouses. The buyer A) can exit the sales contract provided there is mutual rescission. B) can exit the sales contract and get the deposit back. C) cannot exit a valid and binding legal agreement with the seller. D) cannot exit the sales contract because this is a frivolous contingency. - CORRECT ANSWER B) can exit the sales contract and get the deposit back." "Question #21 of 80 Question ID: 1425597 An investor owned a large corporate office building that rented offices out primarily to health care professionals. The investor hired a real estate broker to serve as the property manager. Which of these lists shows the fiduciary duties owed by the rental property owner to the property manager? A) No fiduciary duties are owed B) Obedience, loyalty, disclosure, compensation, accounting, reasonable skill and care C) Honesty, fair dealing, loyalty, compensation, accounting, reasonable skill and care D) Obedience, loyalty, disclosure, confidentiality, accounting, reasonable skill and care - CORRECT ANSWER A) No fiduciary duties are owed" "Question #22 of 80 Question ID: 1425607 Consideration is an essential element of a contract. The element of consideration must be satisfied at the time the parties enter into a contract. How is this accomplished with a real estate purchase and sales contract? A) The buyer promises to pay the seller the purchase price. B) The buyer pays the seller a good-faith deposit. C) The buyer pays the seller the purchase price. D) The buyer pays the seller an earnest money deposit. - CORRECT ANSWER A) The buyer promises to pay the seller the purchase price." "Question #23 of 80 Question ID: 1480240 The owner of a home signs an exclusive right to sell listing contract with the local real estate broker to sell the owner's single-family home. The owner directs the broker to not market the property to persons of European descent. According to the federal fair housing laws, which of the following is TRUE? A) Selling the property without the benefit of advice from a listing agent violated the Fair Housing Act. B) By complying with the owner's limitations on prospective buyers, the broker would be violating the Fair Housing Act. C) The owner violated the Fair Housing Act by limiting buyers based on national origin or religion. D) The marketing that appeared to entertain offers from all prospective buyers violated the Fair Housing Act. - CORRECT ANSWER B) By complying with the owner's limitations on prospective buyers, the broker would be violating the Fair Housing Act." "Question #24 of 80 Question ID: 1425627 Which of these statements describes a short sale? A) A listed property has more debt charged to it than its current fair market value. B) A mortgagee permits a mortgagor to sell for less than what is currently owed. C) The security interest of a junior lender is wiped out by a foreclosure. D) A desperate seller accepts less than the asking price for a property. - CORRECT ANSWER B) A mortgagee permits a mortgagor to sell for less than what is currently owed." "Question #25 of 80 Question ID: 1425595 A buyer has hired a broker to represent her in the purchase of a new home. The broker will be paid a portion of the commission earned by the listing broker. In this situation, the fiduciary obligations of an agent are owed to A) all the parties involved in the transaction. B) each individual who signs the purchase contract. C) the seller through the listing broker who is paying the agent. D) the buyer who employed the agent. - CORRECT ANSWER D) the buyer who employed the agent." "Question #26 of 80 Question ID: 1425609 During contractual negotiations, Party A threatened Party B with violence if Party B did not sign a written lease. Party B signed the written lease agreement. Assuming the contract was properly written and signed, what is the status of the lease? A) Valid, because the contract was properly written and signed B) Void, because Party A threatened Party B with violence C) Voidable, because Party A threatened Party B with violence D) Voidable, because Party A used force against Party B - CORRECT ANSWER C) Voidable, because Party A threatened Party B with violence" "Question #27 of 80 Question ID: 1425593 A salesperson/broker-associate is employed by Broker Realty, Inc. A prospective buyer has signed a buyer representation agreement the with salesperson/broker-associate. Two weeks after signing the buyer representation agreement, the salesperson/broker-associate dies. What is the status of the buyer representation agreement as result of the salesperson/broker-associate's death? A) The contract belongs to heirs of the associate licensee B) Terminated C) The matter will need to be litigated in either a court of law or in an arbitration tribunal D) Unchanged - CORRECT ANSWER D) Unchanged" "Question #28 of 80 Question ID: 1425632 A borrower is in default on his home loan and has offered to give the lender a deed in lieu of foreclosure. The lender declined the borrower's offer. This is MOST likely because A) the lender would not get possession or title upon transfer. B) it will take more time and cost more than foreclosing on the property. C) the loan to value is too high. D) there are junior or secondary liens. - CORRECT ANSWER D) there are junior or secondary liens." "Question #29 of 80 Question ID: 1425625 This is a three-party instrument used to pledge property as security for repayment on real estate financing without giving up possession. The impact on title is limited to the lifetime of the loan. Despite the impact on title, the third party has no right to enter the property. This is A) a seller carryback purchase money mortgage financing. B) a mortgage financing. C) a deed of trust financing. D) a contract for deed financing. - CORRECT ANSWER C) a deed of trust financing." "Question #30 of 80 Question ID: 1425568 Which of these methods of legal description is the BEST for describing an irregularly shaped parcel of real estate? A) Lot and block B) Lot and tract C) Metes and bounds D) Government survey - CORRECT ANSWER C) Metes and bounds" Question #31 of 80 Question ID: 1425562 Which statement is TRUE? A) The general warranty deed from the seller to the buyer guarantees good title. B) Trade fixtures and land convey via a deed, while all personal property transfers through a bill of sale. C) All personal property and fixtures are transferred through a bill of sale. D) Fixtures must be excluded if the seller is not conveying them, while personal property must be included for the buyer to receive it. - CORRECT ANSWER D) Fixtures must be excluded if the seller is not conveying them, while personal property must be included for the buyer to receive it." "Question #32 of 80 Question ID: 1425620 How does a seller's market affect rents? A) It does not affect rents. B) It lowers rents. C) It raises rents. D) It only raises sales prices. - CORRECT ANSWER C) It raises rents." "Question #33 of 80 Question ID: 1425631 A buyer has defaulted on her loan and has not made a payment in six months. The clause in a deed of trust or mortgage permitting the lender to declare the entire unpaid balance immediately due and payable in this situation is the A) forfeiture clause. B) acceleration clause. C) escalator clause. D) judgment clause. - CORRECT ANSWER B) acceleration clause." "Question #34 of 80 Question ID: 1425624 A historic property was being appraised. There were no comps available, and the property generated no income. The owner instructed the appraiser to calculate the cost to build an exact replica of the improvements. The appraiser used the ____ approach and estimated the cost to build the building new with the ______ method. A) cost; reproduction cost B) cost; replacement cost C) sales comparison; reproduction cost D) market data; replacement cost - CORRECT ANSWER A) cost; reproduction cost" "Question #35 of 80 Question ID: 1425579 The title company for the buyer recorded the warranty deed for a recent purchase. This recording has the legal effect of A) providing constructive notice. B) guaranteeing marketable title. C) passing title to the grantee. D) giving actual notice. - CORRECT ANSWER A) providing constructive notice." "Question #36 of 80 Question ID: 1425586 A city discovered that one bedroom of a three-bedroom, two-bathroom home had been built without the appropriate permits. The additional bedroom had been built over 20 years ago. Upon discovery of the unpermitted bedroom, the city A) exercised its power of eminent domain to tell the owner to demolish the bedroom. B) exercised its police power and told the owner to demolish the bedroom or bring it up to code. C) did nothing because the statute of limitations had run. D) exercised its power of escheat and told the owner the bedroom was grandfathered in. - CORRECT ANSWER B) exercised its police power and told the owner to demolish the bedroom or bring it up to code." "Question #37 of 80 Question ID: 1425626 A seller and licensee are completing the listing agreement, and discussing the financing terms the seller is willing to consider. The licensee realizes the seller's current loan not assumable. Which clause in the seller's current mortgage did the licensee read? A) Acceleration clause B) Prepayment clause C) Defeasance clause D) Due-on-sale clause - CORRECT ANSWER D) Due-on-sale clause" "Question #38 of 80 Question ID: 1425639 An apartment building has 15 units, and each unit rents for $1,100 a month. There are onsite laundry facilities, an onsite business center, and storage units that generate $700 a month in additional income. The apartment building has a 5% vacancy rate. What is the effective gross income (EGI) from this income-generating property? A) $96,080 B) $196,080 C) $296,080 D) $150,080 - CORRECT ANSWER B) $196,080 The calculation is 15 units × $1,100 monthly rent = $16,500 × 12 = $198,000 (annual rent). $700 (laundry/business center/storage units) × 12 = $8,400. $198,000 + $8,400 = $206,400. $206,400 - $10,320 [5% vacancy ($206,400 × 5% = $10,320)] = $196,080 (EGI). This is the formula for calculating EGI: Gross potential rent + other income = ____ - vacancies/collection losses = effective gross income. Reference: Real Estate Calculations > Property Valuation" "Question #39 of 80 Question ID: 1425569 Which of these does NOT provide enough information to calculate the area of the parcel? A) The southwest quarter of Section 1 B) Lot 1, Block A, Tree Land Estates C) The north half of Section 35 D) One square mile - CORRECT ANSWER B) Lot 1, Block A, Tree Land Estates" "Question #40 of 80 Question ID: 1425640 An income-producing investment property has annual operating expenses of $12,460 and an effective gross income of $35,000. What is the operating expense ratio? A) 37.6% B) 37.1% C) 36.5% D) 35.6% - CORRECT ANSWER D) 35.6% The operating expense ratio is the expression of operating expenses as a percentage of the effective gross income. This is the formula: operating expenses ÷ effective gross income = operating expense ratio. Reference: Real Estate Calculations > Investment" "Question #41 of 80 Question ID: 1425577 The title insurance company discovers that the deed conveying the property from a prior owner had never been recorded. The property had transferred several times since that prior owner had been on title. The prior owner agreed to sign a deed and convey any residual ownership rights to the current owner. The deed MOST likely used to clear this cloud on title was A) a quitclaim deed. B) a trustee's deed upon sale. C) a general warranty deed. D) a special warranty deed. - CORRECT ANSWER A) a quitclaim deed." "Question #42 of 80 Question ID: 1425587 A listing broker discovered that the seller's roof leaked. The broker disclosed this material defect to the seller, the prospective buyer, and the buyer's agent. The listing broker fulfilled the fiduciary duty of disclosure to A) the seller. B) the buyer. C) the buyer's agent. D) all of these parties. - CORRECT ANSWER A) the seller." "Question #43 of 80 Question ID: 1425628 A seller sold a parcel of vacant land to a buyer, and title transferred at the closing. The property was sold for and was appraised at $1 million. The buyer borrowed $800,000 from a lender to purchase the property and made a down payment of $200,000. What is the loan to value (LTV) ratio on the loan? A) 0% LTV B) 100% LTV C) 20% LTV D) 80% LTV - CORRECT ANSWER D) 80% LTV" "Question #44 of 80 Question ID: 1425619 Two single-family residences are for sale on the opposite sides of the street. Both are well-kept ranch-style tract homes, were built around the same time, and have approximately the same type of amenities. There is an unbroken chain of title for the property located on the north side of the street. There is a break in the chain of title for the property on the south side of the street. Which element of value would be impacted by this? A) Demand B) Utility C) Transferability D) Supply - CORRECT ANSWER C) Transferability" "Question #45 of 80 Question ID: 1425635 An investor purchased a commercial office building for $1.5 million. The land was valued at $375,000 and the improvements at $1,125,000. The investor made a down payment of $300,000 and financed the purchase with a $1,200,000 mortgage from ABC Lending. Following the purchase, the investor took a depreciation allowance on the investment. What was the depreciation allowance based upon? A) $1,500,000 B) $1,200,000 C) $375,000 D) $1,125,000 - CORRECT ANSWER D) $1,125,000" "Question #46 of 80 Question ID: 1425600 Which of these is NOT a protected group under federal Fair Housing Act? A) Convicted drug dealers B) Buddhists C) AIDS patients D) Hispanics - CORRECT ANSWER A) Convicted drug dealers" "Question #47 of 80 Question ID: 1425612 In what type of contract are the parties both contractually obligated from the time of contracting? A) A bilateral contract B) An option contract C) A unilateral contract D) An implied contract - CORRECT ANSWER A) A bilateral contract" "Question #48 of 80 Question ID: 1425564 A property owner recently had a survey and found out that the neighbor's new garage was partially built on her property. The garage is now considered A) adverse possession. B) an easement appurtenant. C) an encroachment. D) a prescriptive right. - CORRECT ANSWER C) an encroachment." "Question #49 of 80 Question ID: 1425614 An owner of a parcel of undeveloped land entered into an option contract with a prospective buyer. During the term of the option, prices of vacant real estate in the area appreciated dramatically. Before the option expired, the optionee exercised the option to purchase the property. At what point did (or will) the parties set a purchase price for the property? A) When the vacant land is appraised B) At the time the optionee exercises the option C) At the closing D) At the time the parties enter into the option - CORRECT ANSWER D) At the time the parties enter into the option" "Question #50 of 80 Question ID: 1425641 A single-family residence sold for $500,000. The buyer financed the transaction with a $400,000 mortgage with ABC Bank. The seller had prepaid the $12,000 property taxes for the entire year. The close scheduled to occur two-and-a-half months before the end of the year. The buyer was responsible for the day of the close. How will the property tax proration be entered on the closing statement? A) Credit seller $2,500; debit lender $2,500 B) Debit lender $2,500; credit buyer $2,500 C) Credit seller $2,500; debit buyer $2,500 D) Debit seller $2,500; credit buyer $2,500 - CORRECT ANSWER C) Credit seller $2,500; debit buyer $2,500" "Question #51 of 80 Question ID: 1425604 A real estate brokerage firm had written employment agreements with each salesperson/broker-associate of the firm. As part of the written employment agreement, the brokerage firm informed the salespersons/broker-associates that the brokerage firm would not withhold taxes or provide other benefits to the salespersons/broker-associates. Even though these individuals are deemed to be independent contractors, which of the following is TRUE? A) Salespersons/broker-associates are required to purchase errors and omissions insurances to protect the broker. B) Salespersons/broker-associates do not have to conform to office policies. C) Salespersons/broker-associates are subject to supervision by the firm's broker. D) The broker can assign work hours to salespersons/broker-associates. - CORRECT ANSWER C) Salespersons/broker-associates are subject to supervision by the firm's broker." "Question #52 of 80 Question ID: 1425584 A retail store in a residential neighborhood is MOST likely an example of A) a zoning variance. B) nonconforming use. C) a special commercial permit. D) special use. - CORRECT ANSWER B) nonconforming use." "Question #53 of 80 Question ID: 1425590 The seller is renovating the family room but still wants the property shown. On some days, the work creates fumes, so the seller instructs the listing broker to make sure that anyone showing the property speaks with the seller first. The listing broker includes the following statement in the property information: "Call before showing." A buyer's broker calls to schedule a showing and leaves a message on the seller's phone. Upon arriving at the property, the buyer is overcome with fumes from the project. Is the listing broker liable? A) Yes, because the listing broker did not exercise reasonable care B) No, because the buyer's broker should have followed the showing instructions C) Yes, because the buyer's broker did not call the listing broker D) No, because the listing broker followed the seller's directions - CORRECT ANSWER A) Yes, because the listing broker did not exercise reasonable care" "Question #54 of 80 Question ID: 1425589 A seller enters into an open listing agreement with multiple brokers, promising to pay the agreed-upon commission to the broker who finds a buyer ready, willing, and able to purchase. The seller must honor the promise if A) the listing brokers promise to exercise due diligence, and the seller finds the buyer. B) no buyer is found. C) a listing broker performs. D) the seller finds a buyer. - CORRECT ANSWER C) a listing broker performs." "Question #55 of 80 Question ID: 1425602 A real estate broker advertised a commission rebate to any buyer or seller using the brokerage firm before the end of the calendar year. This type of advertising is A) legally prohibited by federal law. B) permitted by federal law with proper disclosures. C) a violation of the Sherman Antitrust Act. D) a violation of the Real Estate Settlement Procedures Act (RESPA). - CORRECT ANSWER B) permitted by federal law with proper disclosures." "Question #56 of 80 Question ID: 1425638 An investor wants a 4% rate of return on a parcel of commercial real estate. He sends a property manager out to research which of the four listed properties will generate the desired rate of return. Which of these choices will generate a 4% return? A) $1,000,000 list price with $40,000 NOI B) $1,500,000 list price with $45,000 NOI C) $900,000 list price with $18,000 NOI D) $1,700,000 list price with $51,000 NOI - CORRECT ANSWER A) $1,000,000 list price with $40,000 NOI" "Question #57 of 80 Question ID: 1425573 What do both a determinable fee estate and a life estate with a reversionary interest have in common? A) They both end the with death of someone. B) They are both leasehold estates. C) Both require notice to terminate. D) The right to possession will revert to the grantor. - CORRECT ANSWER D) The right to possession will revert to the grantor." "Question #58 of 80 Question ID: 1425605 A real estate brokerage firm instituted written policies to be followed for each complaint received by all employees of the firm from a member of the public. A salesperson/broker-associate receives a complaint about the brokerage firm and does not comply with the written policies. The broker terminates the salesperson/broker-associate. The termination of the associate licensee was A) illegal. B) unjust and contrary to public policy. C) arbitrary and capricious. D) none of these. - CORRECT ANSWER D) none of these." "Question #59 of 80 Question ID: 1425576 A buyer purchased a home from a seller, and received a valid deed. However, four individuals—including the seller—had equal ownership shares in the property, all as tenants in common. Because only the seller signed the deed, what did the buyer purchase? A) Seller, buyer, and the other three owners now own the property together B) One-quarter interest in the property C) Provided the other owners approve, the entire property D) One-half interest in the property - CORRECT ANSWER B) One-quarter interest in the property" "Question #61 of 80 Question ID: 1425621 A broker completed a competitive market analysis, listed the property, and is advertising it in the local multiple listing service. The asking or probable price listed in all advertising is known as the property's A) loan value. B) market price. C) market value. D) insurable value. - CORRECT ANSWER C) market value." "Question #62 of 80 Question ID: 1425618 An appraiser who is estimating operating expenses is using which approach to value? A) Gross rent multiplier B) Income approach C) Sales comparison approach D) Cost or summation - CORRECT ANSWER B) Income approach" "Question #63 of 80 Question ID: 1425575 Which of the following is a feature of joint tenancy? A) The law of intestate succession will determine the heirs. B) When an owner dies, the deceased's interests pass automatically to the remaining owner C) Probate will be expedited when one owner dies. D) Title will pass as soon as the death certificate is filed for the record. - CORRECT ANSWER B) When an owner dies, the deceased's interests pass automatically to the remaining owner" "Question #64 of 80 Question ID: 1425610 If one party is mentally incapacitated, which essential element of a contract cannot be met? A) Compensation B) Capacity C) Lawful objective D) Consideration - CORRECT ANSWER B) Capacity" "Question #65 of 80 Question ID: 1425565 The owner of a servient tenement noticed the owner of the dominant tenement is no longer using an appurtenant easement because of a newly constructed road. The owners meet to negotiate the termination of the appurtenant easement. Who will sign the deed releasing the easement? A) Both owners will sign the deed. B) The owner of the servient tenement will sign the deed. C) The owner of the dominant tenement will sign the deed. D) This type of interest in land can only be released by a judge in a court of law. - CORRECT ANSWER C) The owner of the dominant tenement will sign the deed." "Question #66 of 80 Question ID: 1425637 An investor owned four single-family residences in a particular area, and is considering the purchase of another property. The owner tells the property manager the purchase price of each of the four single-family residences and the monthly rent that each property generates when occupied. The gross rent multiplier (GRM) for the four currently owned properties is 120. Which of these properties should the property manager recommend the investor purchase to match the 120 GRM? A) $400,000 list price, generating $3,200 in monthly rent B) $500,000 list price, generating $4,000 in monthly rent C) $449,930 list price, generating $3,461 in monthly rent D) $499,920 list price, generating $4,166 in monthly rent - CORRECT ANSWER D) $499,920 list price, generating $4,166 in monthly rent" "Question #67 of 80 Question ID: 1425617 Houses in the local area have had an increase in sales price and a decrease in days on the market. A broker who is attempting to determine the current market value for a residential listing would get the BEST estimate of value by using A) a GRM as the primary consideration to determine value. B) comparables that are no more than 12 months old. C) the cost approach with reproduction estimates. D) comparables that are no more than six months old. - CORRECT ANSWER D) comparables that are no more than six months old." "Question #68 of 80 Question ID: 1425606 A salesperson/broker-associate procured a listing for a single-family residence on behalf of the brokerage. The brokerage found a buyer, the purchase agreement was signed, and the transaction closed. The seller refused to pay the broker a commission for the transaction. Which of the following is TRUE? A) It is a breach of contract. B) It is a violation of the statute of limitations. C) It is a violation of the Americans with Disabilities Act. D) It is a violation of the federal Fair Housing Act. - CORRECT ANSWER A) It is a breach of contract." "Question #69 of 80 Question ID: 1425634 A buyer purchased one-half of a section in one township and a quarter-quarter section in an adjoining township. How many acres did the buyer purchase in total for this transaction? A) 640 acres B) 360 acres C) 520 acres D) 480 acres - CORRECT ANSWER B) 360 acres" "Question #70 of 80 Question ID: 1425629 This is where promissory notes are sold, frequently in bundles. The original lenders sell these promissory notes to other lenders, to investors, and to government-sponsored entities. Where are these bundles of promissory notes sold? A) The secondary mortgage market B) The primary mortgage market C) The seller's market D) The housing market - CORRECT ANSWER A) The secondary mortgage market" "Question #70 of 80 Question ID: 1425636 A single-family residence is free and clear of all liens, apart from a mortgage with an outstanding balance of $20,000. There are no general liens against the owner. The fair market value of the property is $50,000. What is the owner's equity in the property? A) $20,000 B) $30,000 C) $40,000 D) $50,000 - CORRECT ANSWER B) $30,000" "Question #71 of 80 Question ID: 1425615 Regarding land contracts, all of these are correct EXCEPT A) the vendee can possess and occupy the subject property while paying the land contract. B) the vendee will receive a deed when the land contract is paid in full. C) during a land contract, the vendor holds legal title and the vendee holds equitable title. D) during a land contract, the vendor holds equitable title, and the vendee holds legal title. - CORRECT ANSWER D) during a land contract, the vendor holds equitable title, and the vendee holds legal title." "Question #72 of 80 Question ID: 1425583 A buyer wants to build an addition to her home. The addition will require her to build into a setback. In order to build, the buyer will need to A) ask for an amendment to the building code. B) ask for nonconforming use. C) get a special-use permit. D) seek a variance. - CORRECT ANSWER D) seek a variance." "Question #73 of 80 Question ID: 1425598 A homeowners association (HOA) opens up the community association swimming pool to occasional professional swim meets. Which of these would be in violation of the Americans with Disabilities Act (ADA)? A) The swimming pool limits children swimming in the pool to certain times of day. B) The swimming pool limits handicapped swimmers by not providing ramps. C) The swimming pool limits certain times of day to members of specific races. D) The swimming pool limits when a particular sex may swim. - CORRECT ANSWER B) The swimming pool limits handicapped swimmers by not providing ramps." "Question #74 of 80 Question ID: 1425580 A buyer purchased a 5-acre lakeshore property, and bought an owner's title insurance policy. An appurtenant easement for the property across the road was listed as an exception on the owner's policy. Several years later, the owner discovered that the easement gave the property across the road access to the lake along the west side of the owner's property. The easement was affecting the market value of the owner's property. The owner filed a claim with the title insurance company. What will the title insurance company MOST likely pay out on the claim? A) Nothing B) Nothing, provided that the title insurance company discussed the view easement with the buyer C) The reduction in the value of the property due to the easement D) The fair market value of the property at the time of the purchase - CORRECT ANSWER A) Nothing" "Question #75 of 80 Question ID: 1425572 A parcel of commercial property was owned in fee simple absolute. An individual had the right to possess and occupy this property for an entire month. The specific month was specified in the lease, as was the start date and the termination date. What was the name of the estate? A) Estate at sufferance B) Estate at will C) Periodic estate D) Estate for years - CORRECT ANSWER D) Estate for years" "Question #76 of 80 Question ID: 1425591 An old friend called a real estate broker and asked for help in finding a home and securing a loan. Because of the long-standing friendship, the real estate broker was generous with both time and advice. What type of agency may the listing broker have created? A) Agency by ratification B) Agency by estoppel C) General agency D) Implied agency - CORRECT ANSWER D) Implied agency" "Question #77 of 80 Question ID: 1425570 An owner of an agricultural property wants an adult child to own the property for life. When the adult child dies, the owner wants title to the property to transfer immediately to a grandchild. What does the adult child have and what does the grandchild have? A) The grandchild has a life estate and is the measuring life. The adult child has an estate in reversion. B) The adult child has a life estate and is the measuring life. The grandchild has a remainder interest. C) The adult child has a life estate. The grandchild is the measuring life and has a remainder interest. D) The adult child has a life estate and is the measuring life. The grandchild has an estate in reversion. - CORRECT ANSWER B) The adult child has a life estate and is the measuring life. The grandchild has a remainder interest." "Question #78 of 80 Question ID: 1425616 A buyer and seller entered into a sales contract for a lakeshore vacation home. After they signed the contract, the buyer decided the furniture in the vacation home should be included in the transaction. The highly motivated seller agreed. If the sales contract is changed to include the furniture, it would MOST likely be through A) an accretion. B) an addendum. C) an alienation. D) an amendment. - CORRECT ANSWER D) an amendment." "Question #79 of 80 Question ID: 1425588 Which of these pairs is in an agency relationship? A) None of these B) Listing agent and selling agent C) Listing broker and buyer D) Seller and buyer - CORRECT ANSWER A) None of these" "Question #80 of 80 Question ID: 1425581 Which of these property types are exempt from the government's power of eminent domain? A) A family home owned by the same family for 50 years B) A property improved with a $20 million manufacturing plant C) A family farm farmed by the same family for 100 years D) None of these - CORRECT ANSWER D) None of these"