New Mexico RE Principles and
Practice Exam Questions All Solved
Correct.
Cost Approach - Answer Land value plus current construction costs minus depreciation
A landlord discovered that a potential tenant who applied for a unit has a history of alcoholism
and violence. What should the landlord do? - Answer He can refuse to rent to the tenant
because of the history of violence.
Under FHA, It is illegal to discriminate if - Answer A person has AIDS
Deficiency Judgment - Answer A judgement against a borrower if the foreclosure sale does not
bring enough to pay the balance owed
Deed in lieu of foreclosure - Answer Is used when a borrower has defaulted in the mortgage
loan and wants to avoid the foreclosure action.
A loan-to-value ratio - Answer The amount of a loan expressed as a percentage of value of the
real estate offered as collateral
Blanket mortgage - Answer An instrument that creates a lien against multiple parcels of real
property
Waste - Answer Damage caused to a property over and above ordinary wear and tear
To find the value of a property using the income approach to value when the net operating
income and capitalization rate are known, the appraiser would - Answer divide the net
operating income by the capitalization rate.
It is illegal for a lending institution to refuse to make loans in an area - Answer because of the
physical location of the property
Reconciliation - Answer Analyzing the results obtained from the three approaches to value
, Encroachment - Answer A fixture or structure which invades a portion of a property belonging
to another.
Increased residential rental rates could result from - Answer increased mortgage interest rates
Deed of Trust - Answer Creates a lien and acts as security for the promissory note. A three-
party instrument that conveys naked title to a third party, the trustee, who holds the title on
behalf of the lender, also known as the beneficiary. The borrower is the trustor.
Usury - Answer the act of lending money at an exorbitant rate of interest
Escheat - Answer The state takes property upon an owners death if there is no will & no heirs
exist.
Estoppel - Answer The legal process of preventing one party from reclaiming a right that was
waived.
Debit to the buyer - Answer What the mortgagee's policy usually shows on the closing
statement as
If an individual under18 enters into a contract to purchase real estate the contract is - Answer
When only one party can enforce a contract (the minor in this case) the contract is voidable
Equal Credit Opportunity Act - Answer Prohibits lenders from discriminating against credit
applicants on the basis of several factors, including age and marital status, CAN discriminate on
basis of income
Depreciation - Answer Loss of value in real estate from any cause
Acceleration Clause - Answer States that upon default, all of the principal installments come
due immediately.
The market value of a parcel of real estate - Answer an estimate of the most probable price it
should bring
Practice Exam Questions All Solved
Correct.
Cost Approach - Answer Land value plus current construction costs minus depreciation
A landlord discovered that a potential tenant who applied for a unit has a history of alcoholism
and violence. What should the landlord do? - Answer He can refuse to rent to the tenant
because of the history of violence.
Under FHA, It is illegal to discriminate if - Answer A person has AIDS
Deficiency Judgment - Answer A judgement against a borrower if the foreclosure sale does not
bring enough to pay the balance owed
Deed in lieu of foreclosure - Answer Is used when a borrower has defaulted in the mortgage
loan and wants to avoid the foreclosure action.
A loan-to-value ratio - Answer The amount of a loan expressed as a percentage of value of the
real estate offered as collateral
Blanket mortgage - Answer An instrument that creates a lien against multiple parcels of real
property
Waste - Answer Damage caused to a property over and above ordinary wear and tear
To find the value of a property using the income approach to value when the net operating
income and capitalization rate are known, the appraiser would - Answer divide the net
operating income by the capitalization rate.
It is illegal for a lending institution to refuse to make loans in an area - Answer because of the
physical location of the property
Reconciliation - Answer Analyzing the results obtained from the three approaches to value
, Encroachment - Answer A fixture or structure which invades a portion of a property belonging
to another.
Increased residential rental rates could result from - Answer increased mortgage interest rates
Deed of Trust - Answer Creates a lien and acts as security for the promissory note. A three-
party instrument that conveys naked title to a third party, the trustee, who holds the title on
behalf of the lender, also known as the beneficiary. The borrower is the trustor.
Usury - Answer the act of lending money at an exorbitant rate of interest
Escheat - Answer The state takes property upon an owners death if there is no will & no heirs
exist.
Estoppel - Answer The legal process of preventing one party from reclaiming a right that was
waived.
Debit to the buyer - Answer What the mortgagee's policy usually shows on the closing
statement as
If an individual under18 enters into a contract to purchase real estate the contract is - Answer
When only one party can enforce a contract (the minor in this case) the contract is voidable
Equal Credit Opportunity Act - Answer Prohibits lenders from discriminating against credit
applicants on the basis of several factors, including age and marital status, CAN discriminate on
basis of income
Depreciation - Answer Loss of value in real estate from any cause
Acceleration Clause - Answer States that upon default, all of the principal installments come
due immediately.
The market value of a parcel of real estate - Answer an estimate of the most probable price it
should bring
