RE Exam Questions With 100% Correct And Verified Answers| Graded A+.

Which of the following statements about the Sunset Act is TRUE? - correct answer The Sunset Act requires the reviews of all state agencies Why did Texas pass the Texas Real Estate License Act (TRELA)? - correct answer to protect the public from brokers and sales agents who were dishonest. Chapter 1102 of the ______ governs the practice of Texas Real Estate inspectors. - correct answer Texas Occupations Code Who requires sponsorship to practice real estate? - correct answer A sales agent What Professional Organizations DO - correct answer provide additional education and guidance to real estate professionals What is the (NAR) - correct answer The National Association of REALTORS. They are the largest professional/trade association in the United States The title of REALTOR can only be used by those who are members of the _______ - correct answer (NAR) National Association of REALTORS T/F: The role of professional organizations in the real estate industry is to regulate the industry and ensure compliance with all state and federal laws. - correct answer False Which of the following is TRUE about MLS services? A. A REALTOR must belong to at least one board in Texas. B. The more boards an MLS member joins, the better. C. Local associations provide MLS services only to their members. D. A REALTOR can only join one MLS in Texas. - correct answer A. A REALTOR must belong to at least one board in Texas. The Role of Professional Organizations? - correct answer Their role in the industry is to provide education and guidance that benefits their members. Which choice describes "rubber hits the road" education that meets the education requirements for license renewal? A. National Association of REALTORS® B. Graduate, REALTOR® Institute C. Council of Real Estate Brokers Managers D. REALTORS® Land Institute - correct answer B. Graduate, REALTOR® Institute What is a CMA? - correct answer "Comparative Market Analysis": a report that compares the prices of sold homes that are similar to the subject property. What is a BPO - correct answer Broker's Price Opinion (BPO) is the process used by a hired sales agent to determine the potential selling price or estimated value of a real estate property 2 Reasons why a lender would want a BPO? - correct answer #1 people in the home have asked to refinance the home and the lender does not want to pay for a full appraisal, but they do want to have some assurance that the home is valued at or above what the loan will be #2 people in the house are about to be foreclosed on and the lender wants an inexpensive estimate of value What is a "seller's market"? - correct answer # of properties for sale does not meet the demand. Pricing in favor of seller. What is a "buyer's market" - correct answer Fewer buyers than # of homes for sale. Pricing in favor of buyer. The average number of months it will take to sell a house in a buyer's market is: A. 6 months or more B. 4 - 6 months C. 0 - 4 months D. 12 months or more - correct answer A. 6 months or more When an appraisal report is not available, which of the following provides the BEST data for setting a listing price? A. the average listing price for similar properties in the area B. the price willing buyers have recently paid for similar properties in the area C. the average purchase price for all properties in the immediate area D. replacement cost of the structure plus current lot value - correct answer B. the price willing buyers have recently paid for similar properties in the area T/F: A seller is more likely to want to work with an agent who uses the words "price reduction" rather than "price adjustment." - correct answer False The NAR® Code of Ethics is reviewed and updated ____________. A. every year B. every six months C. every two years D. every five years - correct answer A. every year What is the difference between a client and a customer? A. A customer has a legal responsibility to you or your broker and a client does not. B. A client has a legal responsibility to you or your broker and a customer does not. C. A client has an agency relationship with you or your broker and a customer does not. D. A customer has an agency relationship with you or your broker and a client does not. - correct answer C. A client has an agency relationship with you or your broker and a customer does not. Which of the following actions is NOT grounds for disciplinary action, including revocation or suspension of a license? A. Acting negligently or incompetently B. Failing to obey a client's unlawful instruction C. Procuring or attempting to procure a real estate license fraudulently D. Engaging in conduct that is dishonest, or conduct that demonstrates untrustworthiness - correct answer B. Failing to obey a client's unlawful instruction How can a license holder avoid misrepresentation? A. A license holder should not disclose their negligence to the buyer in order to build trust and instill confidence. B. A license holder shouldn't be concerned about the source of their information. C. A license holder should make quality educated guesses to answer questions they don't know the answer to. D. A license holder should point potential buyers to the resources that can help with questions that they shouldn't answer. - correct answer D. A license holder should point potential buyers to the resources that can help with questions that they shouldn't answer. Commingling happens when: A. A license holder mixes their own money with a client's money. B. A client mixes their own money with another client's money. C. A license holder mixes their own money with a broker's money. D. A client mixes their own money with a business' money. - correct answer A. A license holder mixes their own money with a client's money. Which of the following acts is NOT necessarily wrong? A. An agent sells a property using a lottery system. B. A license holder fails to remove earned commissions from the trust account. C. The buyer and the seller both pay the commission. D. A broker uses a client's money for his/her own use. - correct answer C. The buyer and the seller both pay the commission. What is the only scenario in which you do NOT need a real estate license to sell or lease a property? A. If you are selling or leasing on behalf of an immediate family member. B. If you are not receiving any commission from the sale. C. If you are just providing a locating service, and not leasing the property. D. If you are selling or leasing a property whose owner has filed for bankruptcy. - correct answer B. If you are not receiving any commission from the sale. T/F: Employees working for a commercial firm do not have to have a real estate license if they are selling property owned by their firm. - correct answer True Which of the following actions does NOT require a real estate license? A. selling a portion of a joint ownership in a property B. showing the listing of a broker or licensed sales agent C. handling funds in property management D. supervising licensed people - correct answer A. selling a portion of a joint ownership in a property The following circumstances would make the license of a salesperson inactive EXCEPT: A. termination of sponsorship by the sponsoring broker B. death of the salesperson's sponsoring broker C. having a Recovery Fund payment made as a result of an improper transaction D. expiration of the license of the sponsoring broker - correct answer C. having a Recovery Fund payment made as a result of an improper transaction What is "Fixity" - correct answer The permanence of land is known as fixity. Land cannot be moved. This is a geographic characteristic. What is "Situs" - correct answer The desirability of a location, known as situs, is an economic preference for a particular location and not a geographic one. What is "Economic Scarcity" - correct answer Demand for land in particular areas. What is an "Aprraiser" - correct answer Independent professional who uses trained methods to assess the market value of a property. Who DOESN'T need a license? - correct answer New home builders, licensed attorneys and public officials carrying out their duties, and people who are selling or renting their own homes/the property of their employer What is "TRELA" - correct answer The Texas Real Estate License Act (TRELA) governs the activities of real estate brokers and sales agents. What is TREC, and what are they responsible for? - correct answer The Texas Real Estate Commission (TREC) is responsible for enforcing TRELA The primary objectives of the Texas License Law are to: - correct answer -Protect the public from incompetent brokers and sales agents (by requiring them to pass a real estate licensing exam) -Set minimum standards and qualifications for licensing brokers and sales agents -Maintain high ethical and moral standards among license holders What is a "Sunset Act" - correct answer A common state law, which, in Texas, requires the Sunset Commission to evaluate all state agencies every 12 years with respect to their efficiency and the need for their services (essentially, to see if they are still needed). The National Association of REALTORS® Code of Ethics: - correct answer Requires a higher standard than the law requires The Texas Occupation Codes houses - correct answer The Real Estate License Act T/F: The Real Estate Industry is made up of many specialties? - correct answer True Real Estate - correct answer Real estate includes the land AND human-made improvements attached to it. Examples of improvements include buildings, sheds, sewers, and fences. Land - correct answer Land refers to more than a tract of earth. Land includes not only the natural resources seen on the surface of the land but the minerals below the surface and the air above the surface. When a person acquires land, it is possible to acquire all that lies below and above it as well - literally infinity (and beyond). Improvements - correct answer An improvement is any permanent human-made addition that is attached to the land: Buildings, fences, decks, and roads are all examples of improvements. Improvements are considered to be permanently attached to land and therefore are considered real estate. Without improvements, land would just be land. For example, an empty field with no buildings on it is just "land." How boring. Real Property - correct answer Refers to all that PLUS the set of rights associated with real estate ownership. What is the difference between land and real estate? A. Land is a tract of earth plus the resources above and below; real estate is land plus human-made improvements. B. Land is unincorporated; real estate exists in a city or town. C. The two terms are interchangeable. D. Land is property that is unowned; real estate is land that is owned. - correct answer A. Land is a tract of earth plus the resources above and below; real estate is land plus human-made improvements. What's included in a Bundle of Rights? - correct answer -The Right of Exclusion: The right to tell Aunt Sally that she can't trespass on your property. -The Right of Possession: The right to occupy/live/breathe on your property, no matter what Aunt Sally has to say about it. -The Right of Disposition: The right to sell, lease, and/or will a property to Aunt Sally (or whomever). -The Right of Quiet Enjoyment: The right to (legally) use the property for your enjoyment however you (legally) want, no matter what! The bundle of right associated with property ownership include quiet enjoyment, possession, disposition, and: A. destruction B. inclusion C. exclusion D. construction - correct answer C. exclusion Ownership rights include surface rights, subsurface rights, air rights, and: A. construction rights B. vegetation rights C. use rights D. water rights - correct answer D. water rights Subsurface rights/ mineral rights - correct answer Relate to everything beneath the surface of a tract of land. The importance of this right lies largely in the fact that it may secure ownership of mineral deposits located under the surface of a property. For this reason, subsurface rights are also commonly referred to as mineral rights. When an individual owns the mineral rights, they own: A. water rights B. surface rights C. air rights D. subsurface rights - correct answer D. subsurface rights Can an agent assure a purchaser that they will acquire mineral rights with their sale? A. Yes, but the mineral rights will require a separate purchase agreement. B. Yes, everything the owner owns will transfer with the property. D. No, questions about mineral rights are best left to an oil and gas attorney. C. No, in Texas, mineral rights are sold only to third-party buyers. - correct answer D. No, questions about mineral rights are best left to an oil and gas attorney. Surface Rights - correct answer Rights and interests with respect to the surface of the earth, including natural elements and structures built on or attached to it. Also include the right to build improvements on the surface that will enhance the value of the real estate. Air Rights - correct answer The rights to use the airspace above a property. Riparian Rights - correct answer Riparian = rivers and streams Riparian rights govern the use of flowing water, such as a stream or river, that pass through or border a property. In accordance with riparian rights, a property owner does not own the water, but they may use the water and share those same rights and uses with other property owners whose land also borders the water. Littoral Rights - correct answer Littoral = lakes and oceans Littoral rights govern lakefront or seafront property and usually allow the property owner to use the water bordering their property. Littoral use prohibits the property owner from artificially changing the water's location. It is important to note that water rights relate to surface rights in that a right to enjoy a body of water surrounded by privately-owned real estate usually necessitates the surface ownership of the waterfront property. What is the name for water rights that govern the use of flowing water, like a stream or river? A. riverbank rights B. riparian rights C. littoral rights D. homestead rights - correct answer B. riparian rights Buyer Alex is looking at a lakefront property. He has questions about whether he would be allowed to access and use the lake. What kind of rights is Alex wondering about? A. lakefront rights B. homestead rights C. littoral rights