CA REAL ESTATE EXAM PREP
COMPREHENSIVE PRACTICE EXAM QUIZZES
WITH ACTUAL ANSWERS.
Which document is used to give a buyer an overview of the title history and information about what is
or isn't covered in an insurance policy? ANS -Preliminary report
Buyer Maria and seller Doug are closing on June 1. Maria's mortgage loan is $927.86, and $871.86 will
go to interest in the first month. Maria will have to pre-pay interest for June using the 360-day proration
method. If Doug owns the closing day, what Maria's prepaid interest cost be at closing? ANS -$842.74
Which of the following is one of the primary reasons that developers like to invest in unimproved land?
A. It looks good to top investors to have a portfolio of unimproved land.
B. It's easier to build on a blank canvas than it is to retrofit existing infrastructure.
C. It's profitable immediately.
D. Structures are already erected on the land, limiting the development that needs to be done. ANS -B.
It's easier to build on a blank canvas than it is to retrofit existing infrastructure.
Buyer Peter is eager to make an offer on the two-story home you just showed him, but you're
concerned about the back bedroom, since it looks like a relatively recent addition. When Peter asks you
why it's an issue, how do you respond? ANS -You recommend that Peter check on the permits for it, so
that he doesn't buy the house and then have to correct or even remove the addition because it wasn't
built to code.
According to national standards for measuring square footage of a dwelling, which space should be
included? ANS -Attached accessory apartment
,Which physical characteristic of land addresses the concept that land isn't interchangeable, and one
piece of land isn't exactly like another? ANS -Uniqueness
What's the definition of a qualified mortgage? ANS -One that meets stringent CFPB guidelines
Jim would like to sell his own home. What is the minimum real estate license he must possess? ANS -
None
Jason, your client, is developing a subdivision of 140 houses. He may place deed restrictions on as many
as ______ properties. ANS -140 (100%)
How old must an individual be to qualify for a real estate broker license in California? ANS -18
The ______ was enacted in 2010 to create stricter regulation of the financial services industry to reduce
costs for consumers from (for instance), undisclosed kickbacks. ANS -Dodd-Frank Wall Street Reform
and Consumer Protection Act
In which type of common interest subdivision are the owner's shareholders in a corporation that owns
the property? ANS -Stock cooperative project
Which option describes a real property tax lien? ANS -Specific and involuntary
Mark is offering to purchase Sarah's house. They agree, and open an escrow account together. Mark and
Sarah would be considered what to the escrow? ANS -Principals
Lawrence is a buyer closing on a home purchase for which he's obtaining financing. He receives a Loan
Estimate from his lender. What's one purpose of this document? ANS -To provide the estimated closing
costs for Lawrence's loan
Non-lawful possession after the expiration of a lease is called ______. ANS -Estate at sufferance
What is it called when property is taken by the state after the owner dies without heirs? ANS -Escheat
,To develop a marketing plan for the property owner, the property manager should ______. ANS -
Compare the competition to the rates, condition, amenities, and location of the owner's property
Lot and Block Realty received a cease-and-desist order from the FTC due to misleading ads the firm was
running. When does the order become effective? ANS -Immediately upon issuance
Borrowers who fall into the ______ category may be faced with paying interest 1% to 5% over the
current market rate. ANS -Subprime
Reggie has thoroughly reviewed the sales contract with his clients, the Arnolds, and has confirmed that
they understand all of the terms and provisions. What should Reggie do next? ANS -Recommend that
the Arnolds review the sales contract with an attorney before signing it.
What's the name of the clause in a promissory note where this language appears: "If the Note Holder
has not received the full amount of any monthly payment by the end of ______ calendar days after the
date it is due, I will pay a late charge to the Note Holder"? ANS -Late charge provision
Which type of antitrust violation occurs when the providing of one service is made dependent on the
customer or client obtaining another recommended service? ANS -Tie-in arrangement
Kenny is updating a bathroom. Under what circumstances is a contractor's license required? ANS -If he
is preparing his house to sell
When working with a developer who's purchasing undeveloped land for a new subdivision, ABC Realty
stipulates in the contract that in order to purchase the undeveloped land, the developer must purchase
grading services from Bulldozers-R-Us. Which antitrust violation is this? ANS -Tie-in arrangement
One area of town has maximum building height requirements and setbacks for the front, side, and rear
yards. These requirements are all indicative of ______. ANS -Bulk zoning
Margie needs to know the square footage for the first floor of the condo her client is interested in
buying. The kitchen is 10 feet by 15 feet, the living/dining combo is 20 feet by 25 feet, and the office and
bedroom are each 10 feet by 10 feet. What's the total square footage? ANS -850 square feet
, A buyer with a 20-year, $419,000 loan at a 4.25% interest rate has a monthly principal and interest
payment totaling $2,594.59. If $1,483.95 is interest, how much is applied toward principal for that
payment ANS -$1,110.64
During your visual inspection of a property that you are listing for sale, you notice some termite damage
on two of the doorsills. How should you report this issue? ANS -Document the issue on the AVID form
and attach it to the TDS.
Which of the following statements best describes a listing that terminates by performance? ANS -
Roberto listed a property for Terrence. After two failed offers, the property made it to a successful
closing.
As which type of property ownership has a buyer vested his title if he is the only owner of the property?
ANS -Estate in severalty
Joe's applying for a mortgage that meets all of the Fannie Mae/Freddie Mac criteria. Based on this, how
would we classify this loan? ANS -Conforming
James represented a client who believes James was guilty of misrepresentation. The client files a
complaint against James. Which entity will investigate? ANS -California DRE
What makes a non-exclusive buyer representation agreement different from an exclusive buyer
representation agreement? ANS -A non-exclusive agreement allows the buyer to work with other
brokers, any one of whom may end up representing the buyer in the transaction.
Nicholas is a new licensee in an area where there are a lot of condominiums and dwellings geared
toward tourism and seasonal residents. He tries to drum up business by sending faxes to dozens of
condo complexes. Which federal act might he be violating? ANS -Junk Fax Prevention Act of 2005
The Residential Lead-Based Paint Hazard Reduction Act requires sellers, landlords, and their agents to
_______________ any known lead hazards in the home. ANS -Disclose
COMPREHENSIVE PRACTICE EXAM QUIZZES
WITH ACTUAL ANSWERS.
Which document is used to give a buyer an overview of the title history and information about what is
or isn't covered in an insurance policy? ANS -Preliminary report
Buyer Maria and seller Doug are closing on June 1. Maria's mortgage loan is $927.86, and $871.86 will
go to interest in the first month. Maria will have to pre-pay interest for June using the 360-day proration
method. If Doug owns the closing day, what Maria's prepaid interest cost be at closing? ANS -$842.74
Which of the following is one of the primary reasons that developers like to invest in unimproved land?
A. It looks good to top investors to have a portfolio of unimproved land.
B. It's easier to build on a blank canvas than it is to retrofit existing infrastructure.
C. It's profitable immediately.
D. Structures are already erected on the land, limiting the development that needs to be done. ANS -B.
It's easier to build on a blank canvas than it is to retrofit existing infrastructure.
Buyer Peter is eager to make an offer on the two-story home you just showed him, but you're
concerned about the back bedroom, since it looks like a relatively recent addition. When Peter asks you
why it's an issue, how do you respond? ANS -You recommend that Peter check on the permits for it, so
that he doesn't buy the house and then have to correct or even remove the addition because it wasn't
built to code.
According to national standards for measuring square footage of a dwelling, which space should be
included? ANS -Attached accessory apartment
,Which physical characteristic of land addresses the concept that land isn't interchangeable, and one
piece of land isn't exactly like another? ANS -Uniqueness
What's the definition of a qualified mortgage? ANS -One that meets stringent CFPB guidelines
Jim would like to sell his own home. What is the minimum real estate license he must possess? ANS -
None
Jason, your client, is developing a subdivision of 140 houses. He may place deed restrictions on as many
as ______ properties. ANS -140 (100%)
How old must an individual be to qualify for a real estate broker license in California? ANS -18
The ______ was enacted in 2010 to create stricter regulation of the financial services industry to reduce
costs for consumers from (for instance), undisclosed kickbacks. ANS -Dodd-Frank Wall Street Reform
and Consumer Protection Act
In which type of common interest subdivision are the owner's shareholders in a corporation that owns
the property? ANS -Stock cooperative project
Which option describes a real property tax lien? ANS -Specific and involuntary
Mark is offering to purchase Sarah's house. They agree, and open an escrow account together. Mark and
Sarah would be considered what to the escrow? ANS -Principals
Lawrence is a buyer closing on a home purchase for which he's obtaining financing. He receives a Loan
Estimate from his lender. What's one purpose of this document? ANS -To provide the estimated closing
costs for Lawrence's loan
Non-lawful possession after the expiration of a lease is called ______. ANS -Estate at sufferance
What is it called when property is taken by the state after the owner dies without heirs? ANS -Escheat
,To develop a marketing plan for the property owner, the property manager should ______. ANS -
Compare the competition to the rates, condition, amenities, and location of the owner's property
Lot and Block Realty received a cease-and-desist order from the FTC due to misleading ads the firm was
running. When does the order become effective? ANS -Immediately upon issuance
Borrowers who fall into the ______ category may be faced with paying interest 1% to 5% over the
current market rate. ANS -Subprime
Reggie has thoroughly reviewed the sales contract with his clients, the Arnolds, and has confirmed that
they understand all of the terms and provisions. What should Reggie do next? ANS -Recommend that
the Arnolds review the sales contract with an attorney before signing it.
What's the name of the clause in a promissory note where this language appears: "If the Note Holder
has not received the full amount of any monthly payment by the end of ______ calendar days after the
date it is due, I will pay a late charge to the Note Holder"? ANS -Late charge provision
Which type of antitrust violation occurs when the providing of one service is made dependent on the
customer or client obtaining another recommended service? ANS -Tie-in arrangement
Kenny is updating a bathroom. Under what circumstances is a contractor's license required? ANS -If he
is preparing his house to sell
When working with a developer who's purchasing undeveloped land for a new subdivision, ABC Realty
stipulates in the contract that in order to purchase the undeveloped land, the developer must purchase
grading services from Bulldozers-R-Us. Which antitrust violation is this? ANS -Tie-in arrangement
One area of town has maximum building height requirements and setbacks for the front, side, and rear
yards. These requirements are all indicative of ______. ANS -Bulk zoning
Margie needs to know the square footage for the first floor of the condo her client is interested in
buying. The kitchen is 10 feet by 15 feet, the living/dining combo is 20 feet by 25 feet, and the office and
bedroom are each 10 feet by 10 feet. What's the total square footage? ANS -850 square feet
, A buyer with a 20-year, $419,000 loan at a 4.25% interest rate has a monthly principal and interest
payment totaling $2,594.59. If $1,483.95 is interest, how much is applied toward principal for that
payment ANS -$1,110.64
During your visual inspection of a property that you are listing for sale, you notice some termite damage
on two of the doorsills. How should you report this issue? ANS -Document the issue on the AVID form
and attach it to the TDS.
Which of the following statements best describes a listing that terminates by performance? ANS -
Roberto listed a property for Terrence. After two failed offers, the property made it to a successful
closing.
As which type of property ownership has a buyer vested his title if he is the only owner of the property?
ANS -Estate in severalty
Joe's applying for a mortgage that meets all of the Fannie Mae/Freddie Mac criteria. Based on this, how
would we classify this loan? ANS -Conforming
James represented a client who believes James was guilty of misrepresentation. The client files a
complaint against James. Which entity will investigate? ANS -California DRE
What makes a non-exclusive buyer representation agreement different from an exclusive buyer
representation agreement? ANS -A non-exclusive agreement allows the buyer to work with other
brokers, any one of whom may end up representing the buyer in the transaction.
Nicholas is a new licensee in an area where there are a lot of condominiums and dwellings geared
toward tourism and seasonal residents. He tries to drum up business by sending faxes to dozens of
condo complexes. Which federal act might he be violating? ANS -Junk Fax Prevention Act of 2005
The Residential Lead-Based Paint Hazard Reduction Act requires sellers, landlords, and their agents to
_______________ any known lead hazards in the home. ANS -Disclose
