TREC FINAL EXAM with correct answers
which element of a valid contract states that the contract cannot require any illegal activities? - **
VERIFIED ANSWERS **✔✔lawful objective
which of these is the best example of stigmatized property? - ** VERIFIED ANSWERS **✔✔home
where a notorious convicted murderer once lived
A property owner has the right to tell other people that they cannot trespass on their property. What
is this right called? - ** VERIFIED ANSWERS **✔✔right of exclusion
which type of listing agreement is most likely to cause a conflict of interest, and is therefor
discouraged? - ** VERIFIED ANSWERS **✔✔net listing
Which of these is n economic characteristic that makes land a distinctive commodity? - **
VERIFIED ANSWERS **✔✔situs
Darla is suing Arlo for specific performance. If she is successful, what will happen? - ** VERIFIED
ANSWERS **✔✔Arlo will be required to perform according to the terms of the contract
What is the term for deliberate deception done with the intention of gaining something of value or
causing damage to another person? - ** VERIFIED ANSWERS **✔✔fraud
Liability for others by mandate of law or by express agreement is called: - ** VERIFIED ANSWERS
**✔✔vicarious liability
who provides flood insurance to homeowners? - ** VERIFIED ANSWERS **✔✔the National Flood
Insurance Program (NFIP)
personal property MUST be transferred via: - ** VERIFIED ANSWERS **✔✔bill of sale
,when Shondra originally bought her house, she made a 30% down payment on the $600,000
purchase. Assuming that she has been paying towards her principal in the amount of $1,600
monthly for five years. How much equity does she now have in the house? - ** VERIFIED
ANSWERS **✔✔$276,000.
a buyer representation agreement establishes an agency relationship between a buyer and a: - **
VERIFIED ANSWERS **✔✔broker
a debit to the buyer has what effect on charges made to the parties involved in the transaction? - **
VERIFIED ANSWERS **✔✔increases the amount due from the buyer at closing
which of these is an easement that is attached to a piece of land, regardless of owner? - ** VERIFIED
ANSWERS **✔✔easement appurtenant
Joel was told by a lender the highest leverage he could achieve was a loan-to-value ratio of 75%. His
loan principal is $315,000. What is the total purchase price? - ** VERIFIED ANSWERS
**✔✔$420,000
what act is prohibited by the Sherman Antitrust Act? - ** VERIFIED ANSWERS **✔✔price fixing
suppose that a borrower has a gross monthly income of $3,000 and wants to qualify for conforming
loan (total debt service ratio of 36%) with a monthly PITI payment of $800. What is the maximum
amount of additional long-term obligations this borrower may have after PITI? - ** VERIFIED
ANSWERS **✔✔$280
Darleene is looking at an investment property. The annual net operating income (NOI) of the
property is $310,000. If the capitalization rate for this class of property in this area is currently 9%,
what is the total value of this property? - ** VERIFIED ANSWERS **✔✔$3,444,444.44
The term for when the client initiates the termination of the agency agreement is known as: - **
VERIFIED ANSWERS **✔✔revocation
,A married couple bought a home ten years ago for $400,000. Their neighborhood has rapidly grown
in popularity, and they were able to sell their home this year for $950,000. How much of that money
will hey be required to pay capital gains tax on? - ** VERIFIED ANSWERS **✔✔$50,000
What type of listing provides a commission to the broker ONLY if their activities bring about a sale? -
** VERIFIED ANSWERS **✔✔open
when you're talking about mortgages, what is another name for an origination fee? - ** VERIFIED
ANSWERS **✔✔points
which federal law amended the comprehensive environmental response, compensation, and liability
act (CERCLA)? - ** VERIFIED ANSWERS **✔✔superfund amendments and reauthorization act
(SARA)
A Christian organization owns a fourplex. It wants to rent to only Christian tenants. Under the
federal Fair Housing Act, is this legal? - ** VERIFIED ANSWERS **✔✔Yes. Religious organizations
which rent to tenants for residential purposes are exempt from the Fair Housing Act?
All federally related loan programs require a property to have which of these? - ** VERIFIED
ANSWERS **✔✔an appraisal
To be considered a legally competent party to a contract, a person must: - ** VERIFIED ANSWERS
**✔✔have reached the age of majority and be of sound mind
Most of the smaller, older homes on Ridgedale Street have been majorly renovated or torn down and
replaced with high-value homes. 15320 Ridgedale St. is now the smallest, shabbiest home on the
block, but it recently appraised for more than a similar home in a less-upgraded neighborhood. What
principle of value explains this? - ** VERIFIED ANSWERS **✔✔Principal of progression
With intermediary with appointments, who would be considered the intermediary? - ** VERIFIED
ANSWERS **✔✔the broker only
, What is an environmental impact statement? - ** VERIFIED ANSWERS **✔✔a detailed written
statement required by the National Environmental Policy Act for a proposed action significantly
affecting the environment
The most common type of agency between brokers and their sales agents is: - ** VERIFIED
ANSWERS **✔✔general agency
What does it mean if a contract is executory? - ** VERIFIED ANSWERS **✔✔The terms of a
contract have not yet been fully performed by both parties
The statute of frauds states some leases must be in writing while others do not need to be in writing.
Which of the following is TRUE? - ** VERIFIED ANSWERS **✔✔Leases lasting for a term of longer
than one year must be in writing
TREC's Consumer Protection Notice, which is to be displayed prominently in every broker's place of
business, serves to: - ** VERIFIED ANSWERS **✔✔Provide Commission contract information for
the purpose of directing complaints from the public
Conventional loans are divided into two categories. They are: - ** VERIFIED ANSWERS
**✔✔Conforming and non-conforming
Which of these conditions must be met if you are going to advertise services as a real estate team? -
** VERIFIED ANSWERS **✔✔The team name must be registered with TREC before the name can
be used in advertising
An oral contract to buy a piece of real estate is unenforceable because it does not comply with the
statute of: - ** VERIFIED ANSWERS **✔✔frauds
How many square feet are in an acre? - ** VERIFIED ANSWERS **✔✔43,560 square feet
What type of tenancy does a holdover tenant have? - ** VERIFIED ANSWERS **✔✔tenancy at
sufferance
which element of a valid contract states that the contract cannot require any illegal activities? - **
VERIFIED ANSWERS **✔✔lawful objective
which of these is the best example of stigmatized property? - ** VERIFIED ANSWERS **✔✔home
where a notorious convicted murderer once lived
A property owner has the right to tell other people that they cannot trespass on their property. What
is this right called? - ** VERIFIED ANSWERS **✔✔right of exclusion
which type of listing agreement is most likely to cause a conflict of interest, and is therefor
discouraged? - ** VERIFIED ANSWERS **✔✔net listing
Which of these is n economic characteristic that makes land a distinctive commodity? - **
VERIFIED ANSWERS **✔✔situs
Darla is suing Arlo for specific performance. If she is successful, what will happen? - ** VERIFIED
ANSWERS **✔✔Arlo will be required to perform according to the terms of the contract
What is the term for deliberate deception done with the intention of gaining something of value or
causing damage to another person? - ** VERIFIED ANSWERS **✔✔fraud
Liability for others by mandate of law or by express agreement is called: - ** VERIFIED ANSWERS
**✔✔vicarious liability
who provides flood insurance to homeowners? - ** VERIFIED ANSWERS **✔✔the National Flood
Insurance Program (NFIP)
personal property MUST be transferred via: - ** VERIFIED ANSWERS **✔✔bill of sale
,when Shondra originally bought her house, she made a 30% down payment on the $600,000
purchase. Assuming that she has been paying towards her principal in the amount of $1,600
monthly for five years. How much equity does she now have in the house? - ** VERIFIED
ANSWERS **✔✔$276,000.
a buyer representation agreement establishes an agency relationship between a buyer and a: - **
VERIFIED ANSWERS **✔✔broker
a debit to the buyer has what effect on charges made to the parties involved in the transaction? - **
VERIFIED ANSWERS **✔✔increases the amount due from the buyer at closing
which of these is an easement that is attached to a piece of land, regardless of owner? - ** VERIFIED
ANSWERS **✔✔easement appurtenant
Joel was told by a lender the highest leverage he could achieve was a loan-to-value ratio of 75%. His
loan principal is $315,000. What is the total purchase price? - ** VERIFIED ANSWERS
**✔✔$420,000
what act is prohibited by the Sherman Antitrust Act? - ** VERIFIED ANSWERS **✔✔price fixing
suppose that a borrower has a gross monthly income of $3,000 and wants to qualify for conforming
loan (total debt service ratio of 36%) with a monthly PITI payment of $800. What is the maximum
amount of additional long-term obligations this borrower may have after PITI? - ** VERIFIED
ANSWERS **✔✔$280
Darleene is looking at an investment property. The annual net operating income (NOI) of the
property is $310,000. If the capitalization rate for this class of property in this area is currently 9%,
what is the total value of this property? - ** VERIFIED ANSWERS **✔✔$3,444,444.44
The term for when the client initiates the termination of the agency agreement is known as: - **
VERIFIED ANSWERS **✔✔revocation
,A married couple bought a home ten years ago for $400,000. Their neighborhood has rapidly grown
in popularity, and they were able to sell their home this year for $950,000. How much of that money
will hey be required to pay capital gains tax on? - ** VERIFIED ANSWERS **✔✔$50,000
What type of listing provides a commission to the broker ONLY if their activities bring about a sale? -
** VERIFIED ANSWERS **✔✔open
when you're talking about mortgages, what is another name for an origination fee? - ** VERIFIED
ANSWERS **✔✔points
which federal law amended the comprehensive environmental response, compensation, and liability
act (CERCLA)? - ** VERIFIED ANSWERS **✔✔superfund amendments and reauthorization act
(SARA)
A Christian organization owns a fourplex. It wants to rent to only Christian tenants. Under the
federal Fair Housing Act, is this legal? - ** VERIFIED ANSWERS **✔✔Yes. Religious organizations
which rent to tenants for residential purposes are exempt from the Fair Housing Act?
All federally related loan programs require a property to have which of these? - ** VERIFIED
ANSWERS **✔✔an appraisal
To be considered a legally competent party to a contract, a person must: - ** VERIFIED ANSWERS
**✔✔have reached the age of majority and be of sound mind
Most of the smaller, older homes on Ridgedale Street have been majorly renovated or torn down and
replaced with high-value homes. 15320 Ridgedale St. is now the smallest, shabbiest home on the
block, but it recently appraised for more than a similar home in a less-upgraded neighborhood. What
principle of value explains this? - ** VERIFIED ANSWERS **✔✔Principal of progression
With intermediary with appointments, who would be considered the intermediary? - ** VERIFIED
ANSWERS **✔✔the broker only
, What is an environmental impact statement? - ** VERIFIED ANSWERS **✔✔a detailed written
statement required by the National Environmental Policy Act for a proposed action significantly
affecting the environment
The most common type of agency between brokers and their sales agents is: - ** VERIFIED
ANSWERS **✔✔general agency
What does it mean if a contract is executory? - ** VERIFIED ANSWERS **✔✔The terms of a
contract have not yet been fully performed by both parties
The statute of frauds states some leases must be in writing while others do not need to be in writing.
Which of the following is TRUE? - ** VERIFIED ANSWERS **✔✔Leases lasting for a term of longer
than one year must be in writing
TREC's Consumer Protection Notice, which is to be displayed prominently in every broker's place of
business, serves to: - ** VERIFIED ANSWERS **✔✔Provide Commission contract information for
the purpose of directing complaints from the public
Conventional loans are divided into two categories. They are: - ** VERIFIED ANSWERS
**✔✔Conforming and non-conforming
Which of these conditions must be met if you are going to advertise services as a real estate team? -
** VERIFIED ANSWERS **✔✔The team name must be registered with TREC before the name can
be used in advertising
An oral contract to buy a piece of real estate is unenforceable because it does not comply with the
statute of: - ** VERIFIED ANSWERS **✔✔frauds
How many square feet are in an acre? - ** VERIFIED ANSWERS **✔✔43,560 square feet
What type of tenancy does a holdover tenant have? - ** VERIFIED ANSWERS **✔✔tenancy at
sufferance
