California: Real Estate Principles
Practice Exam 1 Correct Questions
With Solved Answers
1 of 50 - Which form of payment is most common for a property manager?
A. A percentage of income.
B. A salary.
C. A flat fee.
D. All of the Above Solved Answers A. A percentage of income.
2 of 50 - Which of the following is exempt from the Natural Hazards Disclosure?
A. A special flood area.
B. A geological hazard.
C. A wildland high fire severity area.
D. A seismic hazard zone. Solved Answers B. A geological hazard.
3 of 50 - Shakeel and Shaheen have sold their home, made an offer on Derek and
Kamisha's home, and the offer was accepted. All the details of the sale have been
worked out, agreed upon and signatures obtained. Now, Shakeel and Shaheen must
obtain a loan for the property. What is the best term to describe their position in the
transaction's timeline?
A. In Contract
B. Chain of Title
C. Abstract and Opinion
D. Both B and C Solved Answers A. In Contract
4 of 50 - Ted and Lisa are selling their home and have signed a listing agreement.
Client or customer? Steven visits Ted and Lisa's open house, and he is interested in
purchasing their home. What happens next? Is Steven a client or customer?
A. Ted and Lisa are customers, and Steven is a client. The listing agent must disclose
to Steven that Ted and Lisa are customers.
B. Ted and Lisa are clients, as is Steven. The listing agent must disclose to Steven that
Ted and Lisa are also clients.
C. Ted and Lisa are customers, and Steven is a client. The listing agent must disclose
to Steven that he/she represents Ted and Lisa and explain customer relationships
D. Ted and Lisa are clients, and Steven is a customer. The listing agent must disclose
to Steven that he/she represents Ted and Lisa and explain customer relationships.
Solved Answers D. Ted and Lisa are clients, and Steven is a customer. The listing
, agent must disclose to Steven that he/she represents Ted and Lisa and explain
customer relationships.
5 of 50 - In early common law, transfers of land were only made when:
A. The transfer of land from husband to wife, upon the husband's death.
B. The transfer of land from father to child, upon the father's death.
C. The transfer of land from father to son, upon the father's death.
D. Both A and B Solved Answers C. The transfer of land from father to son, upon the
father's death.
6 of 50 - What are the parts of a mortgage loan? What purpose does each part serve?
A. A Pledge and Collateral. A Pledge is a promise to pay; and Collateral allows a lender
the right to foreclose if the borrower does not pay.
B. A Promissory Note, a Deed of Trust, and Collateral. A Promissory Note is an I.O.U.
to pay; a Deed of Trust secures the interest in a borrower's real property; and Collateral
allows a lender the right to foreclose if the borrower does not pay.
C. A Pledge and Collateral. A Pledge allows a lender the right to foreclose if the
borrower does not pay; and Collateral is a promise to pay.
D. None of the Above. Solved Answers A. A Pledge and Collateral. A Pledge is a
promise to pay; and Collateral allows a lender the right to foreclose if the borrower does
not pay.
7 of 50 - Jack is leasing a home from Justin for a year. He has decided to lease until he
gets a good feel for the area and knows where he wants to buy. In this relationship, who
has the reversionary right and who has the possessory right ?
A. Jack has the possessory right and Justin the reversionary right.
B. Jack has the reversionary right and Justin the possessory right.
C. Jack and Justin both have the possessory right.
D. Jack and Justin both share the reversionary right. Solved Answers A. Jack has the
possessory right and Justin the reversionary right.
8 of 50 - Which of the following is not a characteristic of the California mortgage
market?
A. California has a large amount of the country's biggest commercial and savings
banks.
B. California has a high population; therefore more people means more homes are
needed.
C. Mortgages are used instead of Deeds of Trust, which allows borrowers greater
flexibility and protection.
D. California has a very active secondary mortgage market. Solved Answers C.
Mortgages are used instead of Deeds of Trust, which allows borrowers greater flexibility
and protection.
Practice Exam 1 Correct Questions
With Solved Answers
1 of 50 - Which form of payment is most common for a property manager?
A. A percentage of income.
B. A salary.
C. A flat fee.
D. All of the Above Solved Answers A. A percentage of income.
2 of 50 - Which of the following is exempt from the Natural Hazards Disclosure?
A. A special flood area.
B. A geological hazard.
C. A wildland high fire severity area.
D. A seismic hazard zone. Solved Answers B. A geological hazard.
3 of 50 - Shakeel and Shaheen have sold their home, made an offer on Derek and
Kamisha's home, and the offer was accepted. All the details of the sale have been
worked out, agreed upon and signatures obtained. Now, Shakeel and Shaheen must
obtain a loan for the property. What is the best term to describe their position in the
transaction's timeline?
A. In Contract
B. Chain of Title
C. Abstract and Opinion
D. Both B and C Solved Answers A. In Contract
4 of 50 - Ted and Lisa are selling their home and have signed a listing agreement.
Client or customer? Steven visits Ted and Lisa's open house, and he is interested in
purchasing their home. What happens next? Is Steven a client or customer?
A. Ted and Lisa are customers, and Steven is a client. The listing agent must disclose
to Steven that Ted and Lisa are customers.
B. Ted and Lisa are clients, as is Steven. The listing agent must disclose to Steven that
Ted and Lisa are also clients.
C. Ted and Lisa are customers, and Steven is a client. The listing agent must disclose
to Steven that he/she represents Ted and Lisa and explain customer relationships
D. Ted and Lisa are clients, and Steven is a customer. The listing agent must disclose
to Steven that he/she represents Ted and Lisa and explain customer relationships.
Solved Answers D. Ted and Lisa are clients, and Steven is a customer. The listing
, agent must disclose to Steven that he/she represents Ted and Lisa and explain
customer relationships.
5 of 50 - In early common law, transfers of land were only made when:
A. The transfer of land from husband to wife, upon the husband's death.
B. The transfer of land from father to child, upon the father's death.
C. The transfer of land from father to son, upon the father's death.
D. Both A and B Solved Answers C. The transfer of land from father to son, upon the
father's death.
6 of 50 - What are the parts of a mortgage loan? What purpose does each part serve?
A. A Pledge and Collateral. A Pledge is a promise to pay; and Collateral allows a lender
the right to foreclose if the borrower does not pay.
B. A Promissory Note, a Deed of Trust, and Collateral. A Promissory Note is an I.O.U.
to pay; a Deed of Trust secures the interest in a borrower's real property; and Collateral
allows a lender the right to foreclose if the borrower does not pay.
C. A Pledge and Collateral. A Pledge allows a lender the right to foreclose if the
borrower does not pay; and Collateral is a promise to pay.
D. None of the Above. Solved Answers A. A Pledge and Collateral. A Pledge is a
promise to pay; and Collateral allows a lender the right to foreclose if the borrower does
not pay.
7 of 50 - Jack is leasing a home from Justin for a year. He has decided to lease until he
gets a good feel for the area and knows where he wants to buy. In this relationship, who
has the reversionary right and who has the possessory right ?
A. Jack has the possessory right and Justin the reversionary right.
B. Jack has the reversionary right and Justin the possessory right.
C. Jack and Justin both have the possessory right.
D. Jack and Justin both share the reversionary right. Solved Answers A. Jack has the
possessory right and Justin the reversionary right.
8 of 50 - Which of the following is not a characteristic of the California mortgage
market?
A. California has a large amount of the country's biggest commercial and savings
banks.
B. California has a high population; therefore more people means more homes are
needed.
C. Mortgages are used instead of Deeds of Trust, which allows borrowers greater
flexibility and protection.
D. California has a very active secondary mortgage market. Solved Answers C.
Mortgages are used instead of Deeds of Trust, which allows borrowers greater flexibility
and protection.
