Topics CRES Final Test with Complete
Solutions
A BPO (Broker Price Opinion) is an estimate of value most often requested by a lending
institution of a real estate broker to determine the value of a foreclosed property. Can a
BPO be used for financing? - ANSWER-No
There are four facts you need to know about BPO's for the State test: 1) BPO stands for
"Broker Price Opinion" 2) They are "estimates of value" NOT an appraisal. Only
licensed appraisers can prepare appraisals. 3) They can be used only for marketing
purposes (valuing a property for sale), NOT for financing (valuing a property for a loan)
4) Whenever you create a BPO (for a bank) or a CMA ("Competitive Market Analysis"
for a client), you need to include these words in the report "This evaluation was
prepared by a licensed real estate broker and is not an appraisal. This evaluation
cannot be used for the purposes of obtaining financing."
A broker acting as a transaction broker for a buyer, with no written agreement needs: -
ANSWER-to provide the buyer with a copy of the "Brokerage Disclosure to Buyer" with
the broker's signature showing the date it was given to the Buyer.
A broker allowed her license to expire and renewed it 32 days after the expiration date.
What does she need to do to reinstate her license? - ANSWER-Pay the renewal fee,
and pay half the renewal fee for it being over 30 days
A Broker Price Opinion (BOP) and Competitive Market Analysis (CMA) are estimates of
value created by real estate licensees for marketing purposes. Since they were not
prepared by a licensed appraiser, the follow words must appear at their bottom: -
ANSWER-This evaluation was prepared by a licensed real estate broker and is not an
appraisal. This evaluation cannot be used for the purposes of obtaining financing.
A buyer and seller have written two contracts for one property: a higher contract to
submit for a larger loan request and another with a lower actual purchase price because
they know the seller is anxious to sell quickly. Which correctly describes this
arrangement? - ANSWER-Fraudulent dual contracting
A buyer employed a broker through a sales associate. Which of the following would not
terminate the buyer agency? - ANSWER-Death of the sales associate
A buyer is assuming a loan and the loan balance has turned out to be less than the
assumption balance provided by the seller. How would this be handled according to the
Residential Contract to Buy and Sell ? - ANSWER-The buyer may terminate the
, contract by written notice if the difference causes the buyer's cash at closing to increase
by a stated amount.
A buyer is concerned that new construction a mile away could have a negative
environmental impact on the home they are considering purchasing. Can they make the
Contract to Buy/Sell contingent on the result of an environmental impact report? -
ANSWER-Yes, you can make a contract contingent on anything
A contract was terminated when the buyer and seller were unable to resolve inspection
issues. The buyer had included the buyer's inspection report as part of the inspection
notice, which included information about a number of small material items. The seller of
the property has what if any obligation for disclosing the issues noted in the report? -
ANSWER-An obligation to fully disclose all material items the buyer found which the
seller now has knowledge of
A Corporation, LLC, Partnership must have E&O insurance for entity and employing
broker
? - ANSWER-True
A counterproposal: - ANSWER-amends the terms and conditions of a proposed contract
to buy/sell
A deed of trust held by someone other than the public trustee is NOT: - ANSWER-
Notice that a legal action is pending that may effect ownership
A designated broker's responsibilities are delegated by: - ANSWER-written statement
by Managing Broker
A home closes for $365,000 how much would you pay the county clerk and public
trustee? - ANSWER-$36.50
A landlord can evict a delinquent tenant by: - ANSWER-bringing a court action
A landowner has two interested parties, which of the following strategies would give the
landowner the best return.
Lease to a rancher who wants to graze horses
Lease to an oil company who wants to drill for oil
Lease to only one or the other
Lease to both - ANSWER-Lease to both
A property manager may refuse to lease to: - ANSWER-A person addicted to or using
illegal drugs
Solutions
A BPO (Broker Price Opinion) is an estimate of value most often requested by a lending
institution of a real estate broker to determine the value of a foreclosed property. Can a
BPO be used for financing? - ANSWER-No
There are four facts you need to know about BPO's for the State test: 1) BPO stands for
"Broker Price Opinion" 2) They are "estimates of value" NOT an appraisal. Only
licensed appraisers can prepare appraisals. 3) They can be used only for marketing
purposes (valuing a property for sale), NOT for financing (valuing a property for a loan)
4) Whenever you create a BPO (for a bank) or a CMA ("Competitive Market Analysis"
for a client), you need to include these words in the report "This evaluation was
prepared by a licensed real estate broker and is not an appraisal. This evaluation
cannot be used for the purposes of obtaining financing."
A broker acting as a transaction broker for a buyer, with no written agreement needs: -
ANSWER-to provide the buyer with a copy of the "Brokerage Disclosure to Buyer" with
the broker's signature showing the date it was given to the Buyer.
A broker allowed her license to expire and renewed it 32 days after the expiration date.
What does she need to do to reinstate her license? - ANSWER-Pay the renewal fee,
and pay half the renewal fee for it being over 30 days
A Broker Price Opinion (BOP) and Competitive Market Analysis (CMA) are estimates of
value created by real estate licensees for marketing purposes. Since they were not
prepared by a licensed appraiser, the follow words must appear at their bottom: -
ANSWER-This evaluation was prepared by a licensed real estate broker and is not an
appraisal. This evaluation cannot be used for the purposes of obtaining financing.
A buyer and seller have written two contracts for one property: a higher contract to
submit for a larger loan request and another with a lower actual purchase price because
they know the seller is anxious to sell quickly. Which correctly describes this
arrangement? - ANSWER-Fraudulent dual contracting
A buyer employed a broker through a sales associate. Which of the following would not
terminate the buyer agency? - ANSWER-Death of the sales associate
A buyer is assuming a loan and the loan balance has turned out to be less than the
assumption balance provided by the seller. How would this be handled according to the
Residential Contract to Buy and Sell ? - ANSWER-The buyer may terminate the
, contract by written notice if the difference causes the buyer's cash at closing to increase
by a stated amount.
A buyer is concerned that new construction a mile away could have a negative
environmental impact on the home they are considering purchasing. Can they make the
Contract to Buy/Sell contingent on the result of an environmental impact report? -
ANSWER-Yes, you can make a contract contingent on anything
A contract was terminated when the buyer and seller were unable to resolve inspection
issues. The buyer had included the buyer's inspection report as part of the inspection
notice, which included information about a number of small material items. The seller of
the property has what if any obligation for disclosing the issues noted in the report? -
ANSWER-An obligation to fully disclose all material items the buyer found which the
seller now has knowledge of
A Corporation, LLC, Partnership must have E&O insurance for entity and employing
broker
? - ANSWER-True
A counterproposal: - ANSWER-amends the terms and conditions of a proposed contract
to buy/sell
A deed of trust held by someone other than the public trustee is NOT: - ANSWER-
Notice that a legal action is pending that may effect ownership
A designated broker's responsibilities are delegated by: - ANSWER-written statement
by Managing Broker
A home closes for $365,000 how much would you pay the county clerk and public
trustee? - ANSWER-$36.50
A landlord can evict a delinquent tenant by: - ANSWER-bringing a court action
A landowner has two interested parties, which of the following strategies would give the
landowner the best return.
Lease to a rancher who wants to graze horses
Lease to an oil company who wants to drill for oil
Lease to only one or the other
Lease to both - ANSWER-Lease to both
A property manager may refuse to lease to: - ANSWER-A person addicted to or using
illegal drugs
