Depletion of Monetary Base
Which of the following is NOT a way that real estate impacts the economy?
False
A locale's economic base has NO influence on its real estate market.
Recovery, Expansion, Hyper-Supply, Recession
Order Real Estate Cycle Phases
Inelastic
Real estate supply is considered to be _ because it cannot be created rapidly.
Rent, Buy a Starter Home, Upgrade to Larger Home, Buy Investment Property, Downsize to Smaller Home, Rent- Retirement Living
Order the typical Real Estate Ownership Life Cycle
Real Property
Which term refers to Land + Improvements + Rights?
Avulsion
During the 2011 Missouri River flood, considerable land was washed away through the process of [].
Crops and Farm Equipment
Which of the following is (are) considered personal property?
Adverse Possession
Taking possession of land through hostile distinct continuous and actual means.
Dedication
Donating property to a public institution.
Foreclosure
Lender takes over property to satisfy unpaid debt.
Escheat
Government taking of property if no will or heirs.
Eminent Domain
Government taking of property to serve public interest.
Survey
A [___] is used to determine or validate a property's legal description.
Lot and Block
Which of the primary survey systems in the US is most commonly used to describe residential subdivision properties?
160
How many acres comprise property A? (1/4 of a regular 640 acre section)
To promote and protect public health, safety, and welfare
What is the PRIMARY purpose of public land use restrictions?
Police Power
Zoning, building code enforcement, traffic regulations, and environmental laws are all examples of the government exercising:
Setback
The distance which a building or part of a building must be from a property line is called a [__].
Non-Conforming Use
Current use violates zoning ordinances but was legal at one time
Variance
Permission to deviate from current zoning laws
Spot Zoning
Re-zoning a parcel inconsistent with surrounding land use
Down Zoning
Re-zoning from higher- to lower-density use
Encumbrance
Any claim, right, lien, estate, or liability that limits the fee simple title to a property is called a(n) [_].
Easement Appurtenant
This type of encumbrance accompanies the land and has both a dominant and servient tenant.
Easement in Gross
Utility companies run lines under your property and can access them as needed because there is a(n) [] on your property.
Encroachment
When your neighbor's fence is inadvertently installed partially on your property, the fence is considered a(n):
Estate
An ownership interest in real property is referred to as a(n):
Leasehold Estate
A non-freehold estate is also called a:
An indefinite period of time
A Freehold Estate grants ownership interest for:
Fee Simple Absolute
Which type of estate provides the most complete and pure ownership interest?
Title
Evidence of ownership in real property is called:
General Warranty Deed
What is the most desirable deed for a buyer?
Severalty Ownership
The individual ownership of real property is referred to as:
Tenancy in Common
If you own property jointly with another person, and have the ability to leave your portion to your heirs in a will, what type of ownership arrangement do you and your other owner have?
Time, Title, Interest, Possession
For a Joint Tenancy to exist, there must be Unity of:
Vacation License
Which of the following is NOT a concept of ownership?
Condominium, Time Share
Which of the following ownership concepts provides fee simple title?
Cooperative
Which of the following ownership concepts provides residents with a proprietary lease?
Tenants in Common
In a condominium complex, ownership of common areas is held as:
Tenancy at Will
A leasehold interest whereby the lessor or lessee may unilaterally terminate the lease at any time and for any reason is called a:
Periodic Tenancy
A leasehold interest whereby there is no expiration date and the term is automatically renewed (unless explicitly terminated in advance) is called a:
Tenancy for Years
If you sign an apartment lease today which ends on 31 August 2017, which type of leasehold interest do you have?
Gross Lease
Property expenses included in base rent
Percentage Lease
Tenant pays a portion of their gross income as rent
Net Lease
Tenant assumes all or part of property expenses
Ground Lease
Long-term lease that enables tenant to erect a building
1.25 Months
In Nebraska, what is the maximum security deposit a landlord may collect from a tenant who has a pet pot-belly pig?
At the end of the original lease term
If you are leasing a single-family home under a 12-month lease and the owner/landlord sells the property at the 6-month point, when does your lease terminate?
Constructive Eviction
If your apartment's heat has stopped working in the dead of winter, and the landlord refuses to fix it, what potential situation is created?
Implied
A contract that is neither written nor explicitly stated orally is known as a [???] contract.
Dual
A(n) [???_] contract refers to the situation when there are two contracts on the same property with different terms and conditions.
Express
All written contracts are considered [???] contracts.
Executory
When a purchase contract has been signed by both buyer and seller, but the transaction hasn't closed yet, the contract is considered to be:
Voidable
If you sign a purchase agreement to sell your home because you are being blackmailed, then that contract is:
Offer and Acceptance
Having a "meeting of the minds" is associated with which element of a valid contract?
Consideration
The amount that the buyer agrees to pay to purchase a property fulfills which required element of a valid contract?
Misrepresentation
Erroneous statements made without the intent to deceive are considered a form of:
Breach
When one party fails to perform as required by the contract, there has been a(n) [???] of contract.
Mortgagor
In a typical real estate transaction with a loan involved, the buyer is also called the:
Principal
The word "client" is synonymous with which of the following words?
Fiduciary Duty
Acting solely in your client's best interests and exercising skill, loyalty, care, and trustworthiness at all times are reflective of what?
Before showing them any houses, inquiring about their financial situation, and at first substantial contact
In Nebraska, when must an agent fill out the agency disclosure form?
Loyalty and honesty, Obedience, Confidentiality, and Accounting
What obligations does an agent have to a client?
Seller
If you call the real estate agent listed on the "for sale" sign, who do they most likely represent?
Buyer
In Nebraska, all selling agents represent the [xxxxxx], unless there is written evidence indicating otherwise.
Transaction Broker
Which relationship is characterized by working with two or more CUSTOMERS?
Dual Agent
Which relationship is characterized by working with two or more CLIENTS?
Must include their broker's name in all advertising, and can engage in all aspects of the real estate brokerage business under the supervision of a designated broker.
Which of the following are true regarding Real Estate Salespersons in Nebraska?
Independent Contractor
This type of individual works on a commission basis, sets their own hours, and pays their own expenses and taxes.
Seller and Broker
A listing is a contract between which parties?
Unilateral
A listing is which type of contract?
Exclusive Right-to-Sell Listing
A listing placed in the Multiple Listing Service (MLS) is always which type of listing?
Exclusive Right-to-Sell Listing
Which listing is the most common type of listing in residential real estate and best serves agents' interests?
Open Listing
Which listing type provides the most flexibility for sellers?
Broker breach, Seller breach, Death of either party, and Destruction of the property
Which of the following can be grounds for termination of a listing agreement?
Bilateral
A purchase agreement is which type of contract?
Buyer and Seller
A purchase agreement is between which parties?
Accept the offer in writing, or Respond with a counteroffer, or Decline the offer in writing, or Do nothing
Once a seller receives an offer, what options does he have?
Buyer and Seller
In Nebraska, who must sign the property disclosure statement before the transaction closes?
Legal Title
After the purchase contract is signed--but not yet closed--what type of title does the seller hold?
Lease Purchase
When a tenant is under an obligation to buy a property at the end of the lease, which agreement is in force?
Blockbusting
Warning a homeowner to sell because minorities are moving into the area is an example of:
Steering
Taking your minority clients to see only homes in minority neighborhoods is an example of:
Redlining
When lenders avoid making loans in specified areas of town, they are practicing:
All classes are protected in this instance
When a long-time owner of 2 single-family homes doesn't use discriminatory advertising, but hires a real estate agent for leasing, which class may he/she legally discriminate against?
Anything but race
When a long-time owner of 2 single-family homes doesn't use discriminatory advertising, nor hire a real estate agent for leasing, which class may he/she legally discriminate against?
True
Discrimination based upon race is never allowed ... no exceptions!
Selling someone else's property for compensation, and Negotiating real estate options, and Getting a referral fee from a broker for a buyer lead, and Drafting a listing contract for a neighbor's house
Which of the following activities requires a real estate license?
County assessor valuating properties in her district, and A strip mall owner selling his own property, and Selling your friend's home as an executor of the estate, and Property managers who only oversee their employer's properties
Which of the following activities does NOT require a real estate license?
The designated broker within her firm
In Nebraska, a licensed Real Estate Salesperson can accept a bonus for a job well done from:
2 real estate classes
What are the minimum education requirements to become a real estate salesperson in Nebraska?
6 real estate classes or 4 real estate classes + 2 years of experience
What are the education requirements to become a real estate broker in Nebraska?
Approaching a seller under an existing listing contract to list with you, and Following a seller's instructions to NOT bring him offers less than $100K, and Guaranteeing to your seller client that the house will sell for at least $200K, and Drafting an op
Which of the following activities could cause you to get your real estate license suspended or revoked?
Primary
The [xxxxxx] mortgage market is where borrowers and lenders conduct business.
Secondary
The [xxxxxx] mortgage market is where loans are packaged and purchased as investments.
Whether or not property is located in "bad" part of town.
Which of the following factors do lenders NOT consider when underwriting loans?
False
The FHA and VA help consumers by directly lending money to them.
True
A person may qualify for a mortgage loan through the Nebraska Investment Finance Authority (NIFA) even if they have no credit history.
80%
Private mortgage insurance (PMI) is used on Conventional Loans when the loan-to-value (LTV) ratio exceeds what threshold?
At least 3 days before closing.
Under the new TILA-RESPA Integrated Disclosure Rule (TRID), when must the new Closing Disclosure (CD) form be given to the borrower?
Real Estate Investment Trusts (REITs)
Which of the following vehicles enable small investors to participate in real estate ventures?
80%
If you own a home worth $200,000 and have a $160,000 mortgage loan on the property, what is the loan-to-value (LTV) ratio?
40K
For the same home (worth $200,000 with a loan of $160,000), how much equity do you have in the home?
3200
When you obtained your $160,000 loan, you were required to pay 2 discount points to the lender. How much did these discount points cost you?
Amortization
The process of decreasing a loan's principal balance over time through regular payments is known as:
Fully Amortized
A loan which has a zero ($0) balance at the end is:
Promissory Note
An "IOU" that documents the loan and the repayment schedule is known as the:
Mortgage
A legal instrument which pledges property (collateral) as security for the note is known as a:
Shorten the loan term (15 vs. 30 years), or Make Bi-Weekly Payments (vs. Monthly), or Pay a little extra each month towards principal
Which of the following are ways to reduce the amount of interest paid on a loan?
Lien Theory
Borrower holds legal title to the property while the debt is being repaid
Title Theory
The lender or trustee holds legal title to the property while the debt is being repaid
True
Nebraska is a Title Theory state, whereby a trustee holds legal title to your property until the debt is repaid.
Is a condensed history of the title, and Reveals the chain of title
An ABSTRACT on a property:
Protect the lender, and Protect the buyer, and Protect the insured against past event
A title insurance policy can be issued to:
Unpaid taxes, and An unrecorded mortgage by the seller, and Easement discrepancies, and A contractor lien on the property
Which of the following would be considered "Clouds on Title" if found during a title search?
False
More pre-paid interest will be required from a buyer when the closing occurs near the end of the month.
Property Management
A service which provides for the operation, maintenance and leasing of a property is known as:
Asset Management
A service which focuses on the financial aspects of ownership, and treats real property as a portfolio is known as:
Maintain the property, and Market the property, and Collect rent, and Find tenants & execute leases
Which of the following are Property Manager responsibilities?
True
In Nebraska, a property manager may manage her employer's properties without holding a Nebraska Real Estate License.
Property appreciation, and Building equity, and tax advantages
Which of the following are considered tangible benefits to owning a home?
Can deduct mortgage interest from income, and Can deduct property taxes from income.
Which of the following are true regarding homeowner deductions on a first home?
True
Profits realized on the sale of a home are called Capital Gains.
$250000 for single filers--$500000 for married filers
Capital gains on the sale of your primary residence are exempt from income taxes, up to what limits?
True
Real estate is a relatively illiquid asset, meaning it cannot be converted to cash quickly or easily.
Less upfront cash required to move in, and Little or no maintenance responsibility, and it's easier to move.
Which of the following are advantages of renting over buying?
Market Value
The most probable sales price a willing buyer would pay a willing seller is known as:
Parents sell their Florida condo to their son
Which of the following would NOT be reflective of a market value transaction?
Increase
When there is strong demand for single family homes but supply is limited, what is the likely effect on market value of single family homes?
Highest and Best Use
The most profitable, economically feasible, legal, and physically permitted use describes which economic principle of valuation?
False
When using the sales comparison approach, adjustments are always made to the subject property.
True
With the sales comparison approach ... when an attribute of the comparable property is INFERIOR to the subject property's, you ADD to the sales price of the comparable.
Sales Comparison
Considers what like properties have sold for
Cost
Building value less depreciation--plus land value
Income
Present value of future benefits
Cost
Stadium
Sales Comparison
Single-Family Home
Income
Office Building
Physical Deterioration
Wear and tear due to age
Functional Obsolescence
Changes in consumer preferences or building standards
External Obsolescence
Changes to the neighborhood
Carbon Monoxide
By-product of combustion which is highly toxic; causes sudden illness and death quickly after inhalation.
Mold
Naturally occurring substance which causes irritation and asthma attacks; thrives in moist environments.
Formaldehyde
Has a strong odor and can be given off by interior-grade pressed wood products.
Asbestos
Used extensively in building materials to provide strength/insulation and improve fireproofing capabilities.
Lead
Can cause brain and nervous system damage when ingested; especially dangerous to children.
Radon
Naturally-occurring radioactive gas which can cause lung cancer.
All of the Acts
A Real Estate Developer must be familiar with which of the following Acts before undertaking a new development project?
Lead-Based Paint Hazard Reduction Act
Which Act requires that buyers and tenants be provided a disclosure on houses built before 1978?
False
Radon is not much of a concern for us here living in eastern Nebraska.
True
The best way to control mold growth is to control moisture and humidity levels in buildings.
True
The best defenses against Carbon Monoxide (CO) poisoning are to have regular maintenance done on your combustion-appliances and to install a CO detector in your house.
True
When asbestos is intact, it generally does not cause health problems.