Jeff Kosaraka has $86,576 left on his 8.5% mortgage. His monthly payment is set at $852.56 for principal and interest (he pays his own taxes and insurance). How much of his next payment will go toward the loan interest?
a)$116.76
b)$239.31
c)$735.80
d)$61
d)$613.25;
a year's interest on a present debt would be $7,358.96 ($86,576 x .085) A month's interest is then $613.25
Theresa Henchey is buying a new home for $200,000. She makes a $47,000 down payment and finances the balance with a 7.5 percent 30-year conventional loan. The factor for repayment is $7.00 per thousand. After making the first payment, what is the remainin
a)$152,885.25;
153 x 7.00 = $1,071 PI $153,000 x .075 / 12 = $956.25 interest; $1071-$956.25 = $114.75 principal. $153,000 - $114.75 = $152,885.25 remaining balance
Which of the following instruments would contain the loan amount, term of the loan, interest rate, and monthly payments?
a)lease
b)mortgage
c)deed
d)None
d)None
A developer received a loan that covers numerous parcels of real estate and provides for the release of the mortgage lien on each parcel as it is sold and an agreed-on amount of the original loan is paid. This type of loan is a
a)package loan
b)wraparound
d)blanket loan
In a loan execution, proper signatures on the promissory note create
a)the lien on the property
b)the indebtedness of the borrower
c)the transfer of ownership to a trustee
d)recording of the lien on the land records
b)the indebtedness of the borrower
When negative amortization occurs, the
a)loan balance increases
b)term of the loan increases
c)monthly payment increases
d)term of the loan decreases
a)loan balance increases
The borrower conveys legal title to the property to a disinterested third party for safekeeping to obtain a loan. In this situation, the document required is a
a)general warranty deed
b)involuntary conveyance
c)trust deed
d)mortgage
c)trust deed
A borrower obtains a $100,000 mortgage at 7.5%. It the monthly payment of $902.77 is credited first to interest and then to the principal, what will the balance of the principal be after the borrower makes the first payment?
a)$99,772.77
b)$99,375.23
c)$9
d)$99,722.23;
$100,000 x .075 /12 = $625; $902.77 - $625 =277.77 $100,000 - $277.77 = $99,722.23
A collateral property is sold. It is then determined that the net proceeds did not clear the debt. In this situation, the borrower will likely receive a
a)notice of foreclosure
b)letter of defeasance
c)certificate of liability
d)notice of deficiency judge
d)notice of deficiency judgement
One of the newer developments in mortgage lending is the use of
a)fixed-rate 30yr mortgages
b)adjustable-rate mortgages
c)wraparound mortgages
d)computerized loan origination
d)computerized loan origination
How may FHA insured and VA guaranteed loans be assumed?
a)on payment of an assumption fee to the seller
b)only if the second borrower is related to the original borrower
c)either freely or on creditworthiness of the buyer, depending on the date of the loa
c)either freely or on creditworthiness of the buyer, depending on the date of the loan
A tenant paid rent of $500, due on the first of the month, and a $500 security deposit. The property then is sold on Sept 15. How much money will the sellers owe the buyer at closing?
a)$500
b)$750
c)$1,000
d)$1,500
b)$750;
security deposit will transfer to new owner, $500 + 1/2 of one month's rent ($250)=$750 total
A borrower notices that he is paying MIP on his HUD Settlement Statement. What kind of loan does he have?
a)80%percent LTV conventional loan
b)VA loan
c)FHA 203(b) loan
d)graduated payment loan
c)FHA 203(b) loan
Using real property, while retaining the property itself as collateral to secure a loan is called
a)hypothecation
b)encumbrance
c)mortgage
d)promissory intent
a)hypothecation
An accrued charge on a settlement statement is paid
a)in advance
b)always by the seller
c)always by the buyer
d)in arrears
d)in arrears
Any federally backed loan may require the borrower to carry special insurance if the property is located in
a)an earthquake area
b)a desert
c)an ocean hazard district
d)a flood zone
d)a flood zone
Which method of foreclosure is used in a deed of trust mortgage lien?
a)Sheriff's sale at the courthouse
b)Judicial court-ordered sale
c)nonjudicial power of sale
d)Deed in lieu of accepted by the lender
c)nonjudicial power of sale
If real estate real estate taxes are paid in arrears, what would the seller be debited on a Sept 14 closing with annual taxes of $5,400? (use the statutory method; taxes accrue from Jan 1 through closing date, seller responsible for day of closing)
a)$3,8
c)$3,810;
$5400/360 days = $15.00 per day x 254 = $3,810 debit to the seller. Count (via the statutory method) the # of days from Jan 1st to Sept 14
Which of the following phrases is allowable in an advertisement to lease a nonexempt 80-unit apt complex under the current Federal Fair housing Act?
a)no handicapped alterations will be made
b)adults only; no children
c)Females only
d)No smoking on premis
D, no smoking on premises
The provisions of RESPA apply to
a)all residential mortgage loans
b)one-to four family residential mortgage loans
c)all mortgages except home equity loans
d)commercial mortgages up to $2,000,000
b)one-to four family residential mortgage loans
When representing a buyer in a real estate transaction, the agent must disclose to the seller all the following except
a)any potential for the agent to benefit from referring the parties to a subsidiary of the agents firm for transaction-related services
d)the buyer's financial situation
The term "walkthrough" refers to
a)the buyer's final inspection of the property before closing to check its condition
b)empty office buildings where the vacancy
c)a seller's check of the premises before an open house is held
d)an appraiser's inspection of
a)the buyer's final inspection of the property before closing to check its condition
The seller delivers the deed and the buyer pays the purchase price in the step referred to as
a)commitment
b)underwriting
c)closing
d)warehousing
c)closing
The entity that loses ownership through a deed of trust foreclosure is the
a)lender
b)mortgagor
c)mortgagee
d)beneficiary
b)mortgagor
Steve Lee owns an apt building that was constructed in 1965. According to federal law, which of the following must be attached to the leases Steve prepares for prospective tenants?
a)A lead-based paint disclosure statement
b)A report of the building radon
a)A lead-based paint disclosure statement
While Dana Mawn spends six months in Europe, he continues to pay rent to his landlord but actually collects rent from his friend Brian, who is living there while he is gone. The situation is known as
a)an assignment
b)a temporal rental
c)a lease option
d)
d)a sublet
All are examples of involuntary transfer of title except
a)adverse possession
b)condemnation through eminent domain
c)dedication
d)tax sale
c)dedication
One advantage of condominium ownership over cooperative ownership is that
a)condo owners can mortgage their units individually
b)condo owners pay no maintenance fees
c)a cooperative owner must put down at least 20% down payment
d)there is basically no dif
a)condo owners can mortgage their units individually
Key provisions of RESPA include all the following except
a)the lender's estimate of settlement costs
b)a settlement location
c)a uniform settlement statement
d)the disclosure of controlled business
b)a settlement location
Scott Roberto's tenants all had a few months remaining on their leases when he entered into a contract to sell his six unit apt building to mike C. Tenants in this situation normally
a)need do nothing and may remain until the end of their leases
b)can be
a)need do nothing and may remain until the end of their leases
Which of the following would be classified as limited common elements in a condominium development?
a)Elevators
b)Hallways
c)Unassigned parking spaces
d)assigned parking spaces
d)assigned parking spaces
The federal ban on housing discrimination based on familial status is aimed at providing equal access to rentals for
a)unmarried couples
b)retired individuals with or without pets
c)single tenants
d)people with children
d)people with children
A tenant in an office park pays a monthly rent that includes all property maintenance charges, cleaning services, and utilities. This is a
a)tenant at will
b)triple net lease
c)net lease
d)gross lease
c)net lease
The management agreement does all the following except
a)identify the parties
b)state the owner's overall goals for the property
c)describe the manager's responsibilities and authorities
d)authorize the manager to make personal deals resulting in outside
d)authorize the manager to make personal deals resulting in outside compensation by suppliers
The penalty for a first violation of federal fair housing laws can be as much as
a)$1,000
b)$5,000
c)$100,000
d)$10,000
d)$10,000;
the penalties for subsequent violations can be as much as $100,000
A type of lease that is common in retail properties requires the tenant to pay a portion of gross sales to the landlord. This is often referred to as a
a)net lease
b)sales lease
c)gross lease
d)percentage lease
d)percentage lease
Candy Coady lives in one side of a three-family house. She wants to advertise the other side as non-smoking. Can she legally do so?
a)No, because a property owner cannot advertise discriminatory practices
b)yes, because she occupies part of the house hers
c)yes, because the right to smoke is not protected by law
An appraiser is appraising a house that had an estimated economic life of 30 years when the property was purchased 20 years ago. If the appraiser currently estimates that the house is one-third depreciated, what is the remaining economic life?
a)10 years
c)20 years;
1/3 of 30 = 10 years depreciation; 30-10 = 20 yrs
A house was built 75 years ago. Two of the five bedrooms have no closets, the basement floor is gravel and dirt, and the original slate rood needs repairs. To the appraiser, the most important consideration is
a)how the bedrooms could be reconfigured to p
c)the sale price of a nearby similar property
Which of the following would most likely be considered incurable depreciation?
a)improvements beyond those of other homes in the area
b) roof with curled and cracked shingles
c)a broken window
d)septic system has failed
a)improvements beyond those of other homes in the area
When an appraiser deducts depreciation using the reproduction cost of a building, the depreciation represents
a)loss of value due to any cause
b)costs to modernize property
c)lack of site improvements
d)current cost to construct a similar building
a)loss of value due to any cause
What will the amount of taxes payable be if the property's assessed value is $85,000 and the tax rate is 50 mills in a town where the equalization factor is 100%?
a)$9,350
b)$4,250
c)$3,460
d)$4,675
d)$4,675;
$85,000 x 1.1 = $93,500; $93,500/1,000 = $93.50 x 50 = $4,675
Randy Cross hires Jeff, a property manager, to lease a house that he owns. Randy is Jeff's
a)customer
b)fiduciary
c)client
d)lessor
c)client
A tenant is delinquent on his lease payments. The owner can
a)disconnect natural gas service to the tenant's unit
b)bring court action
c)personally evict the tenant after giving 24-hour constructive notice
d)turn off the electricity and water
b)bring court action
A property is valued at $850,000 by an appraiser and generates an annual net income of $152,000. What capitalization rate % did the appraiser use is determining value?
a)11.5
b)18
c)14.45
d)13
b)18;
Capitalization rate for annual rate of ROI is computed by dividing a property's annual net income by the property value. $152,000/$850,000 = .18 (rounded up) =18 % cap rate
Which of the following is not necessary in order for a property to have value?
a)the owner of the property is unknown
b)There is minimal supply in the regional market
c)The property is unique
d)the property has a useful purpose
a)the owner of the property is unknown
Although the objective in the cost approach is to estimate the value of both land and improvements, the land typically is appraised using the
a)HUD taxation maps and charts
b)market data approach
c)gross rent multiplier approach
d)option approach
b)market data approach
The correct formula for estimating value using the cost approach is
a)cost to reproduce + depreciation - financing cost = value
b)depreciation + value of land - cost to reproduce = value
c)value of land + cost to reproduce + depreciation = value
d)cost to
d)cost to reproduce - depreciation + value of land = value
The most profitable way in which a particular property can be used is known as its
a)highest and best use
b)plottage value
c)zoning conformance
d)principle of progression
a)highest and best use
An income approach appraisal would include which of the following information?
a)building value based on cost per square ft
b)gross operating income over the past three years
c)replacement cost of structure and site improvements
d)annual net operating inc
d)annual net operating income generated
In comparing a competitive market analysis to a comparative market analysis, what is the differing factor?
a)properties currently for sale in the same market area
b)amenity diff between the comparables
c)adjustments for time of sale, such as location and
a)properties currently for sale in the same market area
Mark Sogofsky refuses to sell his farm to the state, which needs it to complete the route for a new highway. The state may go to court and ask that his farm be condemned, allowing the state to purchase the land using its right of
a)eminent domain
b)advers
a)eminent domain
Which of the following effects, if any, does zoning have on property values?
a)value is enhanced because of the principle of conformity
b)values are unchanged because owners have the freedom to develop land as they wish
c)value is diminished because of th
a)value is enhanced because of the principle of conformity
Which of the following statements is true of tenancy in common?
a)When on of the tenants dies, his interest is spread among the survivors
b)Destruction of the property terminates the co-ownership
c)one of the tenants can assign his or her rights of the de
d)unless another form of ownership is described in the deed, co-owners who are not spouses of each other are presumed to be tenants in common
A planned development consists of
a)subdivision designed by a board-certified master planner
b)parcels owned separately and areas owned in common for use by parcel owners
c)a high-rise building that includes apts as well as commercial units, such as store
b)parcels owned separately and areas owned in common for use by parcel owners
A subdivider must place in the public records a map of the property known as a
a)plat
b)before and after schematic
c)plot
D)plan
a)plat
Danielle owned fee simple title to a lot next door to the church. She gave the lot to the church as a gift. However, she wanted to make sure the lot would always be used for related purposes. Her attorney prepared her deed to convey ownership of the lot t
a)fee simple determinable
Which approach to value is best when appraising a seven-unit apt building?
a)market rent escalation or depreciation
b)replacement cost
c)The income approach to value
d)The reproduction cost
c)The income approach to value
To determine an encroachment, the purchaser should obtain
a)a survey
b)title insurance
c)a title search
d)a current opinion from the town assessor
a)a survey
An owner is planning to build on a newly purchased lot. Zoning laws state that no improvement may exceed 50 ft in height, architectural guidelines limit improvements to 45 ft in height, and the deed restriction states the maximum height to be 35 ft. What
d)35 ft;
he most restrictive limit applies with there is a conflict in legal development language
The right that a power company acquires to lay a service line across a customer's property is called
a)a variation
b)a license
c)an easement in gross
d)a restrictive covenant
c)an easement in gross
An odorless substance created by decaying radioactive materials in the soil is known as
a)radon gas
b)urea formaldehyde
c)carbon monoxide
d)ultraviolet degradation
a)radon gas
Soil that builds up gradually along a river bank is called
a)alluvion
b)avulsion
c)peat
d)silt
a)alluvion
A seller, anxious to sell, tells a cooperating agent during a showing that the agent will be given a commercial lawn mower if he brings in an acceptable offer by the end of the week. All the following are true in this scenario except that the
a)cooperatin
d)agent may accept the lawn mower because he is providing a desired service
Regarding real property, which of the following statements is true?
a)Air rights can be granted separately by deed
b)trade fixtures attached to the building are always the landlord's property
c)Emblements are considered as fixtures because they are attach
a)Air rights can be granted separately by deed
What is the square footage of a room measuring 20 ft by 30 ft?
a)500 sq ft
b)620 sq ft
c)600 sq ft
d)840 sq ft
c)600 sq ft; 20 x30 = 600
Rita Lee, a salesperson for XYZ Realty, is required by contract to attend meetings, dress in uniform, and prospect for four hours per day. She receives a biweekly paycheck, less withholding for taxes and Social Security. Rita's relationship with the firm
b)an employee
When offering property for cooperation through the MLS, the listing broker is assuring all the following except
a)cooperating brokers will be compensated on completion of the sale
b)any offer will be accepted as it is written
c)the seller has the authorit
b)any offer will be accepted as it is written
You are a licensed real estate agent and a Realtor meaning that you are bound to a standard of ethics higher that a non-Realtor. You find a conflict between the NAR code of ethics and state law you should
a)follow the code of ethics so that you do not los
b)follow the state law even though it is unethical
Which fee does not have to be listed in a lender's advert when the actual note interest rate is mentioned?
a)appraisal fee
b)required down payment
c)number of payments over loan term
d)monthly payment amount
a)appraisal fee
A doctor calls and states he is pre-qualified to buy a $325,000 home. He is not familiar with your area and asks where he should live. You reply, "the meadows estates, that's where several professionals like yourself live" this is an example of
a)steering
a)steering
Kelly Lambert owns an apt building that was constructed in 1980. According to federal law, which of the following must be attached to the leases Kelly prepares for prospective tenants?
a)
D) none
Broker Penney has finalized the negotiation on his listing at 1000 Main St. He received earnest money of $5,000 for the deal. What must he do with the earnest money?
a)Put the check in his company's escrow account
b)put the check in the deal file and turn
a)Put the check in his company's escrow account
A salesperson is about to change companies. Should he contact all his buyer clients and advise them that he will still represent them at his new firm?
a)no, because the listing is with the broker
b)yes, because a listing is a personal service agreement an
a)no, because the listing is with the broker
A landlord not offering as many properties to a family with children that were offered to a single prospect is an example of
a)channeling prospects
b)supportive marketing
c)less favorable treatment
d)malice before the fact
c)less favorable treatment
For a real estate agency relationship to be enforceable, which of the following is not required?
a)The principal has the power to do what is being assigned
b)the principal must attain a credit report of the agent, updated monthly
c)the agent must be autho
b)the principal must attain a credit report of the agent, updated monthly
The quirks put their house on the market, the Schneiders made a written purchase offer, and the Quirks accepted the offer in writing. When is the contract valid?
a)Three days after the Quirks' written acceptance
b)As soon as the signatures are notarized
c
d)When the Schneiders are notified of the acceptance
The broker's responsibility at the closing is to
a)verify and receive the brokerage fee
b)explain the clauses found in the deed
c)assist the bank's attorney with the document sign offs
d)interpret the terms and conditions contained in the loan documents
a)verify and receive the brokerage fee
Agent Carol has just returned from a closing for a property that sold for $250,000. The property was listed by Northern Realty. Carol received 2.5% of the total sale price commission for the transaction from the closing agent. Carol has a 55/45 split with
d)$3,438 (rounded up);
$250,000 x 0.25 = $6,250 x .55 = $3,437.50
Escrow monies can be defined as and include
a)promissory notes
b)A, C and D
c)security deposits
d)earnest money
b)A, C and D
Which is not an example of a buyer-agency agreement?
a)a dual agency
b)an open buyer's agency
c)an exclusive-agency buyer agency
d)An exclusive buyer agency
a)a dual agency
Which of he following would terminate a listing agreement?
a)the death of the broker
b)the retirement of the salesperson
c)the expiration of the salesperson's license
d)salesperson procuring his or her broker's license
a)the death of the broker
A salesperson negotiates a sale and obtains a written contract signed by all parties. The sale closes but the seller refuses to pay the broker a commission. the broker is not willing to sue the seller for the commission because the seller is his sister-in
a)sue the broker only
Keith Sturges wants to buy Dave Flanders house, but Dave does not want to turn over title until he receives the purchase price. They could use either a lease option or a land contract. Keith would prefer a lease option because
a)it will allow him to move
b)he will be free to change his mind about buying
Within the agency agreement is a provision that binds the buyer to paying the broker's fee if, within a stated number of days, the buyer purchases a property that was shown to the buyer during the agency period. This clause is called the
a)unlimited cover
d)broker protection clause
The buyer has been held to be in default on a contract of sale. If the buyer and seller did not initially agree on liquidated damages, the seller could do which of the following?
a)require the buyer to set aside satisfactory monies in escrow
b)require the
d)sue the buyer for compensatory damages
One effect of a clause in a sales agreement that states that "time is of the essence" might be that
a)the seller can take care of matters only on request of the agent
b)all parties must attend to those details called for in the agreement in a timely manne
b)all parties must attend to those details called for in the agreement in a timely manner
The legal remedy in many sales contracts that allows the non-defaulting party to force the sale is
a)specific performance
b)vendor's lien
c)bilateral promises
d)punitive damages
a)specific performance
The lender charges two discount points to the buyer. How much does this increase the buyer's closing costs on his $270,000 home if his LTV is 80%
a)$4,320
b)$5,400
c)$4,000
d)$2,000
a)$4,320;
$270,000 x .80 = $216,000 loan amount; $216,000 x 2% =$4,320
A buyer, Pepe offers in writing to pay $275,333 for a property. Mr Lopez makes a down payment of 25% and finances the balance by obtaining a 30 year old conventional loan. The factor for the PI payments is $7.34 per thousand. The lender opens an escrow ac
d)$1,815.71;
$275,533 x .75 = $206,500 loan (rounded up); $206,500 x 7.34 / 1,000 = $1,515.71 principal and interest; $3,000 + $600/ 12 = $300 for taxes and insurance;
$300 + $1,515.71 PI= $1,815.71 PITI
If the buyer's agent splits his commission 50/50 with his broker, and the seller's agent receives 60% of his broker's 50% share, how much does the buyer's broker receive if the listing broker's fee is 6% of the $250,000 sales prices of the house?
a)$7,500
a)$7,500;
$250,000 x .06 = $15,000; $15,000 x .50 = $7,500 total buyer broker share
If a lender agrees to make a loan based on a 90% LTV, what is the amount of a loan for a property appraised for $135,000 and a sale price of $137,800?
a)$124,020
b)$105,920
c)$121,500
d)$126,000
c)$121,500;
the loan is always based on the lesser of the purchase price and the appraised value; $135,000 x .90 = $121,500
If a seller's agent shares his commission with a buyer's agent
a)the seller's agent may deduct that amount from the total he pays his agent
b)the seller's agent may advise the seller of the cooperation
c)the buyer's agent does not have to disclose this to
d)this is not necessarily an indication of agency representation
Which of the following terms best describes the parties to a purchase and sales contract?
a)Vendor-vendee
b)Mortgagee-mortgagor
c)Grantor-Grantee
d)Lesser-lessee
a)Vendor-vendee
Real estate taxes are paid annually in Nov for the calendar year. The closing is held on Aug 15, and the real estate taxes of $6,500 are prorated to the date of closing. What entries are made on the settlement statement?
a)charge seller and credit buyer $
a)charge seller and credit buyer $4,062.53;
$6,500 / 12 = $541.67 per month x 7.5 months = $4,062.53 (round)
A property is sold for $75,000 in certified check. If transfer taxes are $1.83 per $1,000 of value, how much transfer tax is due?
a)$138.60
b)$152.50
c)$1,525.00
d)$1,384.20
a)$138.60; $75,600 /1,000 = 75.6;
$75.60 x $1.83= $138.35
If a homeowner has a first mortgage loan balance of $63,250, a second mortgage balance of $12,000, and unpaid taxes of $4,015, how much equity does he have in his $100,000 home?
a)$25,000
b)$24,750
c)$100,000
d)$20,735
b)$24,750;
$100,000 - $63,250 - $12,000 = $24,750; taxes are considered an expense (to be prorated at closing) but not considered a debt
What is the sq footage of a family room measuring 20 ft by 23 ft?
a)232 sq ft
b)640 sq ft
c)460 sq ft
d)500 sq ft
c)460 sq ft;
23 x 20 = 460 sq ft
A house sold for $164,000 and was assessed at 90%. If real estate taxes are $4.30 per $100 of value, what are the annual taxes?
a)$7,546.80
b)$4,300.00
c)$6,346.80
d)$3,526.00
c)$6,346.80;
$164,000 x .90 = $147,600 x .0430 = $6,346.80
A borrower must pay $2,800 for points on a $140,000 loan. How many points is the lender charging for this loan?
a)2
b)2.5
c)4.5
d)4
a)2;
$2,800 / $140,000 = .02 = 2.0% (2 points)