Real Estate - AYPO practice final exam
what is the primary purpose of regular reconciliation on clients' trust accounts? -
CORRECT ANSWER-to catch problems when they are small
what kind of contract is an option? - CORRECT ANSWER-a unilateral contract
discount points - CORRECT ANSWER-a fee that reduces the interest rate on a
mortgage loan
*carol takes out a second mortgage on her house. what should the bank issuing the
second mortgage do if they want to give their lien preferential weight over any other
liens that may be imposed on carol's property? - CORRECT ANSWER-perfect the lien
from the second mortgage
what is the official legal term in Michigan for listing or buyer agency agreement that est.
an agency relationship between a real estate broker and a client? - CORRECT
ANSWER-service provision agreement
equitable remedy - CORRECT ANSWER-reformation
CC&Rs in real estate stands for: - CORRECT ANSWER-covenants, conditions, and
restrictions
*if the demand for a product remains relatively the same, what is the best way to
increase the value of that product? - CORRECT ANSWER-decrease the supply of that
product
comprehensive long-range plan intended to guide growth and development of a
community or region? - CORRECT ANSWER-a master plan
who reviews the form and content of the real estate exam? - CORRECT ANSWER-both
the department of licensing and regulations and the board of real estate brokers and
salespersons
what type of agency is likely in a power of attorney arrangement? - CORRECT
ANSWER-universal
*a real estate agent walked through a client's house. he noted 4 things: side yard is not
maintained, lock on back door doesn't effectively latch, support beams in the basement
are discolored and has some cracks, and some of the linoleum tiles in the kitchen are
loose. Which of these items should he suggest to be professionally inspected? -
CORRECT ANSWER-the support beams in the basement
, *if the total cost of the loan is paid off in a set of scheduled payments across the term,
the loan is... - CORRECT ANSWER-fully amortized
in order for a deed to be legal, it must: - CORRECT ANSWER-be recorded with the
county clerk
*does the real estate settlement procedures act allow the receiving of unearned fees for
services not actually preformed? - CORRECT ANSWER-no
what is the purpose of mortgage insurance - CORRECT ANSWER-to reimburse a
lender should a borrower default on a mortgage loan
*a property owner is considering "buying" discount points for a $65,000 second
mortgage with a 30 year term. This will lower annual interest rates from 10.5% to 9.5%.
Is the total cost of the second mortgage greater with the 10.5% annual interest rate or
with the 9.5% rate and the added cost of the points? - CORRECT ANSWER-greater
total cost at 10.5% interest ($214,110)
*if a real estate professional intentionally fails to disclose a conflict of interest to a party
they are representing in a real estate transaction, the real estate professional could be
accused of... - CORRECT ANSWER-committing fraud
according to the regulations est. by the Michigan department of insurance and financial
services in response to the passage of the Dodd-Frank and the SAFE act, in order to
use a land contract to finance the purchase of a property, the person must be able to... -
CORRECT ANSWER-qualify for a traditional mortgage loan
the current transfer tax rate in Michigan is... - CORRECT ANSWER-$3.75 per $500 of
the total property value
how can a short sale be advantageous for a lender? - CORRECT ANSWER-the short
sale pays off some of the debt and avoids the extra costs associated with foreclosure
processdings
*a property was purchased for $350,000. Since then, the property has appreciated a
total of $75,000 in value. the owner also built a $26,000 structure on the property. now
the property is being sold and the seller owes transfer taxes. if the transfer tax rate is
$10 for every $5,000 of the adjusted tax basis, how much does the seller owe in transfer
taxes?
(purchase price + improvement value + total accumulated appreciation adjusted tax
basis)(adjusted tax basis x tax rate = transfer taxes) - CORRECT ANSWER-$902
property taxes are considered which type of taxes? - CORRECT ANSWER-ad-valorem
taxes
what is the primary purpose of regular reconciliation on clients' trust accounts? -
CORRECT ANSWER-to catch problems when they are small
what kind of contract is an option? - CORRECT ANSWER-a unilateral contract
discount points - CORRECT ANSWER-a fee that reduces the interest rate on a
mortgage loan
*carol takes out a second mortgage on her house. what should the bank issuing the
second mortgage do if they want to give their lien preferential weight over any other
liens that may be imposed on carol's property? - CORRECT ANSWER-perfect the lien
from the second mortgage
what is the official legal term in Michigan for listing or buyer agency agreement that est.
an agency relationship between a real estate broker and a client? - CORRECT
ANSWER-service provision agreement
equitable remedy - CORRECT ANSWER-reformation
CC&Rs in real estate stands for: - CORRECT ANSWER-covenants, conditions, and
restrictions
*if the demand for a product remains relatively the same, what is the best way to
increase the value of that product? - CORRECT ANSWER-decrease the supply of that
product
comprehensive long-range plan intended to guide growth and development of a
community or region? - CORRECT ANSWER-a master plan
who reviews the form and content of the real estate exam? - CORRECT ANSWER-both
the department of licensing and regulations and the board of real estate brokers and
salespersons
what type of agency is likely in a power of attorney arrangement? - CORRECT
ANSWER-universal
*a real estate agent walked through a client's house. he noted 4 things: side yard is not
maintained, lock on back door doesn't effectively latch, support beams in the basement
are discolored and has some cracks, and some of the linoleum tiles in the kitchen are
loose. Which of these items should he suggest to be professionally inspected? -
CORRECT ANSWER-the support beams in the basement
, *if the total cost of the loan is paid off in a set of scheduled payments across the term,
the loan is... - CORRECT ANSWER-fully amortized
in order for a deed to be legal, it must: - CORRECT ANSWER-be recorded with the
county clerk
*does the real estate settlement procedures act allow the receiving of unearned fees for
services not actually preformed? - CORRECT ANSWER-no
what is the purpose of mortgage insurance - CORRECT ANSWER-to reimburse a
lender should a borrower default on a mortgage loan
*a property owner is considering "buying" discount points for a $65,000 second
mortgage with a 30 year term. This will lower annual interest rates from 10.5% to 9.5%.
Is the total cost of the second mortgage greater with the 10.5% annual interest rate or
with the 9.5% rate and the added cost of the points? - CORRECT ANSWER-greater
total cost at 10.5% interest ($214,110)
*if a real estate professional intentionally fails to disclose a conflict of interest to a party
they are representing in a real estate transaction, the real estate professional could be
accused of... - CORRECT ANSWER-committing fraud
according to the regulations est. by the Michigan department of insurance and financial
services in response to the passage of the Dodd-Frank and the SAFE act, in order to
use a land contract to finance the purchase of a property, the person must be able to... -
CORRECT ANSWER-qualify for a traditional mortgage loan
the current transfer tax rate in Michigan is... - CORRECT ANSWER-$3.75 per $500 of
the total property value
how can a short sale be advantageous for a lender? - CORRECT ANSWER-the short
sale pays off some of the debt and avoids the extra costs associated with foreclosure
processdings
*a property was purchased for $350,000. Since then, the property has appreciated a
total of $75,000 in value. the owner also built a $26,000 structure on the property. now
the property is being sold and the seller owes transfer taxes. if the transfer tax rate is
$10 for every $5,000 of the adjusted tax basis, how much does the seller owe in transfer
taxes?
(purchase price + improvement value + total accumulated appreciation adjusted tax
basis)(adjusted tax basis x tax rate = transfer taxes) - CORRECT ANSWER-$902
property taxes are considered which type of taxes? - CORRECT ANSWER-ad-valorem
taxes
