Ct Real Estate Practice exam general
questions with complete solutions
Which rule-of-thumb version is being offered to an investor who is told that a house
renting for $900 a month should sell for about $90,000? - ANSWER-GRM
When a property owner uses his home as collateral for a loan and creates a lien in
favor of the lender, title is held by the - ANSWER-mortgagor
When the sellers are lending part of the purchase price, they may secure the debt
either with a deed of trust or a mortgage. For the seller, one benefit of the deed of
trust is that - ANSWER-foreclosure is usually simpler and faster
Regulation Z requires that the borrower be fully informed of all of the following
EXCEPT - ANSWER-the total interest
The FHA functions MOST like - ANSWER-an insurance company
The purpose of usury laws is to regulate - ANSWER-interest rates charged by
lenders
Which of the following statements about discount points is FALSE? - ANSWER-They
are computed as a percentage of the selling price
A borrower has defaulted on the mortgage. The mortgage contains an acceleration
clause. This permits the lender to - ANSWER-demand immediate payment of the
entire note
A loan which requires the borrower to pay interest only until the maturity date (or due
date), and then to pay the entire principal on the maturity date, is called a -
ANSWER-term loan
An example of a fiduciary relationship is one which exists between the listing broker
and - ANSWER-her client
A broker has brought a ready, willing, and able buyer to a seller. In MOST listing
contracts, the broker has earned his commission when - ANSWER-the seller accepts
the offer
One common method for controlling the problems created by conflict of interest in
dual representation is - ANSWER-allowing a broker to designate separate
salespeople within the company as legal representatives of each of the clients.
The day after a broker's listing on a house expired, it was listed with another broker
and offered in the MLS. Several days later, a third licensee called the first broker and
, asked for the key to show the home. The broker should inform the caller that -
ANSWER-he is no longer the listing agent
When a principal authorizes an agent to perform a particular act or transaction, it is
an example of a - ANSWER-special agency
A broker supplies the financing for a project to build condominiums with the
stipulation that he has the exclusive right to sell the completed condos. Which of the
following BEST describes this relationship? - ANSWER-Agency coupled with an
interest.
A broker, acting as agent for the seller, presents an offer to buy from the broker's
former college roommate. The broker knows that the buyer will increase the amount
of the offer if the seller turns down the offer. When presenting the offer, the broker
should - ANSWER-tell the seller that the buyer will pay more
During the listing presentation, the seller questions the amount of commission to be
paid and is told - ANSWER-the amount of commission is negotiable
Which of the following events would AUTOMATICALLY cancel a listing agreement? -
ANSWER-Property owner's death
Under the terms of their listing contract, the owners may sell their house themselves
and pay no commission. If their agent sells it, a commission will be due. What kind of
listing contract do the owners have? - ANSWER-Exclusive agency listing
A seller tells the listing agent that her home was treated for termites 10 years ago, so
there are no termites now. Before listing the property, the agent should - ANSWER-
tell the seller to disclose the termite treatment on the property disclosure.
Which of the following is the first action to take when mold problems are found? -
ANSWER-Identify and remedy the cause of the problems
Without checking the facts, a broker who is the seller's agent tells a buyer that the
property taxes in a particular neighborhood are among the lowest in the area. The
buyer relies on the broker's statement and makes an offer on a house in the
neighborhood. Before closing, it is determined that the taxes are actually among the
highest in the area. The buyer could seek to rescind the contract on the basis of -
ANSWER-misrepresentation
The real estate broker who is listing a house for sale should personally verify -
ANSWER-the number of square feet in the building
At the time of listing, the seller tells the listing agent they are moving because the
neighbor has loud parties every weekend. The agent should - ANSWER-tell potential
buyers about the parties
The Department of Housing and Urban Development estimates that most private
homes built before 1978 contain potentially dangerous levels of lead. Because of
questions with complete solutions
Which rule-of-thumb version is being offered to an investor who is told that a house
renting for $900 a month should sell for about $90,000? - ANSWER-GRM
When a property owner uses his home as collateral for a loan and creates a lien in
favor of the lender, title is held by the - ANSWER-mortgagor
When the sellers are lending part of the purchase price, they may secure the debt
either with a deed of trust or a mortgage. For the seller, one benefit of the deed of
trust is that - ANSWER-foreclosure is usually simpler and faster
Regulation Z requires that the borrower be fully informed of all of the following
EXCEPT - ANSWER-the total interest
The FHA functions MOST like - ANSWER-an insurance company
The purpose of usury laws is to regulate - ANSWER-interest rates charged by
lenders
Which of the following statements about discount points is FALSE? - ANSWER-They
are computed as a percentage of the selling price
A borrower has defaulted on the mortgage. The mortgage contains an acceleration
clause. This permits the lender to - ANSWER-demand immediate payment of the
entire note
A loan which requires the borrower to pay interest only until the maturity date (or due
date), and then to pay the entire principal on the maturity date, is called a -
ANSWER-term loan
An example of a fiduciary relationship is one which exists between the listing broker
and - ANSWER-her client
A broker has brought a ready, willing, and able buyer to a seller. In MOST listing
contracts, the broker has earned his commission when - ANSWER-the seller accepts
the offer
One common method for controlling the problems created by conflict of interest in
dual representation is - ANSWER-allowing a broker to designate separate
salespeople within the company as legal representatives of each of the clients.
The day after a broker's listing on a house expired, it was listed with another broker
and offered in the MLS. Several days later, a third licensee called the first broker and
, asked for the key to show the home. The broker should inform the caller that -
ANSWER-he is no longer the listing agent
When a principal authorizes an agent to perform a particular act or transaction, it is
an example of a - ANSWER-special agency
A broker supplies the financing for a project to build condominiums with the
stipulation that he has the exclusive right to sell the completed condos. Which of the
following BEST describes this relationship? - ANSWER-Agency coupled with an
interest.
A broker, acting as agent for the seller, presents an offer to buy from the broker's
former college roommate. The broker knows that the buyer will increase the amount
of the offer if the seller turns down the offer. When presenting the offer, the broker
should - ANSWER-tell the seller that the buyer will pay more
During the listing presentation, the seller questions the amount of commission to be
paid and is told - ANSWER-the amount of commission is negotiable
Which of the following events would AUTOMATICALLY cancel a listing agreement? -
ANSWER-Property owner's death
Under the terms of their listing contract, the owners may sell their house themselves
and pay no commission. If their agent sells it, a commission will be due. What kind of
listing contract do the owners have? - ANSWER-Exclusive agency listing
A seller tells the listing agent that her home was treated for termites 10 years ago, so
there are no termites now. Before listing the property, the agent should - ANSWER-
tell the seller to disclose the termite treatment on the property disclosure.
Which of the following is the first action to take when mold problems are found? -
ANSWER-Identify and remedy the cause of the problems
Without checking the facts, a broker who is the seller's agent tells a buyer that the
property taxes in a particular neighborhood are among the lowest in the area. The
buyer relies on the broker's statement and makes an offer on a house in the
neighborhood. Before closing, it is determined that the taxes are actually among the
highest in the area. The buyer could seek to rescind the contract on the basis of -
ANSWER-misrepresentation
The real estate broker who is listing a house for sale should personally verify -
ANSWER-the number of square feet in the building
At the time of listing, the seller tells the listing agent they are moving because the
neighbor has loud parties every weekend. The agent should - ANSWER-tell potential
buyers about the parties
The Department of Housing and Urban Development estimates that most private
homes built before 1978 contain potentially dangerous levels of lead. Because of
