CE Shop National Exam
With Solution Update
What's interest, as related to a mortgage loan payment?
- A fee paid to lenders for the use of their money
- A fee to keep other borrowers from taking interest in your property and buying it out
from under you
- Extra money paid to cover any unexpected bank fees
- Random charges - Answer -✔✔A fee paid to lenders for the use of their money
Margaret is meeting with James and Cindy, potential buyers of a property listed by one
of Margaret's colleagues. They're in Margaret's office preparing their offer when James
says, "The only thing that bothers me are those black spots on the bathroom ceiling. Do
you think that could be the bad kind of mold? It's not dangerous, is it?" What should
Margaret do?
- Refer James and Cindy to a qualified mold professional.
- Tell them that she will personally clean it up.
- Tell them they could probably clean it up with a little bleach.
- Tell them to not worry about it. - Answer -✔✔Refer James and Cindy to a qualified
mold professional.
Jenner purchased his first home, to which he'll have access forever, as far as he knows.
Jenner owns a(n) ______.
- Estate for years
- Freehold estate
- Leasehold estate
- Ownership estate - Answer -✔✔Freehold estate
In full seller disclosure states, whose responsibility is it to fully disclose all items on a
seller disclosure form and any known material defects not listed on the form?
- Appraiser
- Buyer
- Lender
- Seller - Answer -✔✔Seller
,The Smithwicks, your buyer clients, obtained a 90% loan on their new $400,000 home.
At closing, they paid $6,150 for points at closing. How many points did they pay?
.017
.02
1.7
1.71 - Answer -✔✔1.71
A point is 1% of the loan amount. The Smithwicks' loan is $360,000 ($400,000 x .90),
and they paid $6,150 for points at closing. Divide the cost in points by the loan amount
to get the number of points they paid: ($6,150 ÷ 360,000 = 0.0170833, or 1.71).
Zach wants to purchase a property that's subject to an existing lease agreement, which
includes the tenant's right to renew the lease. What is Zach's obligation, if any, to
uphold the terms of the lease agreement?
- As the new owner and landlord, Zach can disregard the renewal option.
- As the new owner and landlord, Zach can terminate the existing lease.
- Zach is under no obligation to uphold any part of the existing lease agreement.
- Zach must honor that right and allow the tenant to renew at the end of the term. -
Answer -✔✔Zach must honor that right and allow the tenant to renew at the end of the
term.
Ray purchased a new home and soon discovered an issue with one of the windows. He
filed a claim with the warranty provider, but it was denied. After mediation, the issue still
remains unresolved. What is the most common next step?
- Arbitration
- A second round of mediation
- Condemnation
- Litigation - Answer -✔✔Arbitration
Warranties will detail the course of action if a claim is disputed. Most often, mediation
occurs first, then arbitration. The arbitration decision is generally binding and final. The
disputed claim process seeks to avoid or limit litigation.
What is the primary purpose of the Superfund Amendments and Reauthorization Act
(SARA)?
, - To prohibit companies from depositing hazardous substances in commercial
neighborhoods
- To prohibit companies from depositing hazardous substances in residential
neighborhoods
- To release homeowners from the responsibility of cleaning up hazardous substances if
the homeowner didn't know they existed
- To require homeowners to clean up hazardous substances within one year of learning
they exist - Answer -✔✔To release homeowners from the responsibility of cleaning up
hazardous substances if the homeowner didn't know they existed
Which of these actions is a violation of the Residential Lead-Based Paint Hazard
Reduction Act when a property constructed before 1978 is being marketed by a
licensee?
- The buyer is given more than 10 days to complete a lead inspection of the property.
- The buyer's agent fails to complete the lead-based paint disclosure form.
- The seller refuses to perform lead abatement work requested in buyer's offer.
- The seller's agent fails to provide the pamphlet, "Protect Your Family From Lead in
Your Home" to prospective buyers. - Answer -✔✔The seller's agent fails to provide the
pamphlet, "Protect Your Family From Lead in Your Home" to prospective buyers.
Margie needs to know the square footage for the first floor of the condo her client wants
to make an offer on. The kitchen is 10 feet by 15 feet, the living/dining combo is 20 feet
by 25 feet, and the office and sunroom are each 10 feet by 10 feet. What's the total
square footage?
- 2,200 square feet
- 3,000 square feet
- 750 square feet
- 850 square feet - Answer -✔✔850 square feet
Area = length x width. Find the area of each room to get its square footage, then add
the square footage of all four rooms. Kitchen = 150 sq ft; living/dining = 500 sq ft; office
= 100 sq ft; and sunroom = 100 sq ft. = 850 square feet.
You're working with a buyer who's purchasing a home appraised at $80,000. The buyer
is obtaining a 90% loan, and the lender will charge a one point origination fee at closing.
How much will the loan origination fee be?
- $712
With Solution Update
What's interest, as related to a mortgage loan payment?
- A fee paid to lenders for the use of their money
- A fee to keep other borrowers from taking interest in your property and buying it out
from under you
- Extra money paid to cover any unexpected bank fees
- Random charges - Answer -✔✔A fee paid to lenders for the use of their money
Margaret is meeting with James and Cindy, potential buyers of a property listed by one
of Margaret's colleagues. They're in Margaret's office preparing their offer when James
says, "The only thing that bothers me are those black spots on the bathroom ceiling. Do
you think that could be the bad kind of mold? It's not dangerous, is it?" What should
Margaret do?
- Refer James and Cindy to a qualified mold professional.
- Tell them that she will personally clean it up.
- Tell them they could probably clean it up with a little bleach.
- Tell them to not worry about it. - Answer -✔✔Refer James and Cindy to a qualified
mold professional.
Jenner purchased his first home, to which he'll have access forever, as far as he knows.
Jenner owns a(n) ______.
- Estate for years
- Freehold estate
- Leasehold estate
- Ownership estate - Answer -✔✔Freehold estate
In full seller disclosure states, whose responsibility is it to fully disclose all items on a
seller disclosure form and any known material defects not listed on the form?
- Appraiser
- Buyer
- Lender
- Seller - Answer -✔✔Seller
,The Smithwicks, your buyer clients, obtained a 90% loan on their new $400,000 home.
At closing, they paid $6,150 for points at closing. How many points did they pay?
.017
.02
1.7
1.71 - Answer -✔✔1.71
A point is 1% of the loan amount. The Smithwicks' loan is $360,000 ($400,000 x .90),
and they paid $6,150 for points at closing. Divide the cost in points by the loan amount
to get the number of points they paid: ($6,150 ÷ 360,000 = 0.0170833, or 1.71).
Zach wants to purchase a property that's subject to an existing lease agreement, which
includes the tenant's right to renew the lease. What is Zach's obligation, if any, to
uphold the terms of the lease agreement?
- As the new owner and landlord, Zach can disregard the renewal option.
- As the new owner and landlord, Zach can terminate the existing lease.
- Zach is under no obligation to uphold any part of the existing lease agreement.
- Zach must honor that right and allow the tenant to renew at the end of the term. -
Answer -✔✔Zach must honor that right and allow the tenant to renew at the end of the
term.
Ray purchased a new home and soon discovered an issue with one of the windows. He
filed a claim with the warranty provider, but it was denied. After mediation, the issue still
remains unresolved. What is the most common next step?
- Arbitration
- A second round of mediation
- Condemnation
- Litigation - Answer -✔✔Arbitration
Warranties will detail the course of action if a claim is disputed. Most often, mediation
occurs first, then arbitration. The arbitration decision is generally binding and final. The
disputed claim process seeks to avoid or limit litigation.
What is the primary purpose of the Superfund Amendments and Reauthorization Act
(SARA)?
, - To prohibit companies from depositing hazardous substances in commercial
neighborhoods
- To prohibit companies from depositing hazardous substances in residential
neighborhoods
- To release homeowners from the responsibility of cleaning up hazardous substances if
the homeowner didn't know they existed
- To require homeowners to clean up hazardous substances within one year of learning
they exist - Answer -✔✔To release homeowners from the responsibility of cleaning up
hazardous substances if the homeowner didn't know they existed
Which of these actions is a violation of the Residential Lead-Based Paint Hazard
Reduction Act when a property constructed before 1978 is being marketed by a
licensee?
- The buyer is given more than 10 days to complete a lead inspection of the property.
- The buyer's agent fails to complete the lead-based paint disclosure form.
- The seller refuses to perform lead abatement work requested in buyer's offer.
- The seller's agent fails to provide the pamphlet, "Protect Your Family From Lead in
Your Home" to prospective buyers. - Answer -✔✔The seller's agent fails to provide the
pamphlet, "Protect Your Family From Lead in Your Home" to prospective buyers.
Margie needs to know the square footage for the first floor of the condo her client wants
to make an offer on. The kitchen is 10 feet by 15 feet, the living/dining combo is 20 feet
by 25 feet, and the office and sunroom are each 10 feet by 10 feet. What's the total
square footage?
- 2,200 square feet
- 3,000 square feet
- 750 square feet
- 850 square feet - Answer -✔✔850 square feet
Area = length x width. Find the area of each room to get its square footage, then add
the square footage of all four rooms. Kitchen = 150 sq ft; living/dining = 500 sq ft; office
= 100 sq ft; and sunroom = 100 sq ft. = 850 square feet.
You're working with a buyer who's purchasing a home appraised at $80,000. The buyer
is obtaining a 90% loan, and the lender will charge a one point origination fee at closing.
How much will the loan origination fee be?
- $712
