BARNEY FLETCHER FINAL EXAM, Exams of Real Estate Management

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A seller's listing expired on August 31st. On August 10th, another broker contacted the seller about listing the property when the current listing expired. Is this legal? A. no, because the first broker has a right of first refusal on the listing B. no, because the broker contacted the seller prior to the expiration date C. yes, because a new broker can take over once the current listing expires D. yes, because owners should have the right to choose whatever broker they want whenever they want B. no, because the broker contacted the seller prior to the expiration date Sam sold a property to Emma for $225,000. Sam's loan balance was $44,500 with an interest rate of 7%. Emma's conventional loan was at 8% with a 90% loan to value ratio. The taxes for the year were $1, and the home owner's insurance was $495. Closing took place on October 30th. Based on this information, answer the following question. What was the amount of the property tax proration? A. $212. B. $208. C. $1,037. D. $1,041. A. $212. Amount tax bill $1,250 divided by 365 = $3.4246 per day x 62 days = $212.3287 = $212. The sales price of the property is $185,000. The new loan is $145,000. How much will the transfer tax be? A. $ B. $

C. $

D. $

B. $

$185,000 the transfer tax is paid on the taxable amount at .10 per $100. Sales price - loan assumption = taxable amount $185,000 - 0 = $185,000 divided by 100 = $1,850 x .10 = $185. Which of the following is not true about a deed to secure debt? A. when the document is delivered and accepted, it passes legal title B. in order to be recorded, it is witnessed the same way a mortgage is C. with a security deed, the lender holds equitable title D. once recorded, the deed to secure debt creates a lien on the property C. with a security deed, the lender holds equitable title Sam sold a property to Emma for $225,000. Sam's loan balance was $44,500 with an interest rate of 7%. Emma's conventional loan was at 8% with a 90% loan to value ratio. The taxes for the year were $1, and the home owner's insurance was $495. Closing took place on October 30th. Based on this information, answer the following question. How much was the accrued interest and to whom was it paid? A. lending institution $259. B. lending institution $256. C. Emma $17. D. Emma $268. A. lending institution $259. $44,500 x 7% = $3,115 divided by 360 days = 8.6527 x 30 days = $259.5833 = $259. (accrued interest is paid for the due date through and including the day of closing) Which of the following would not be covered by RESPA? A. a VA loan for $55,000 first mortgage on a single family home B. an FHA loan for a first mortgage on a single family home C. a conventional loan for a first two family residence where the lender was insured by the FDIC D. a buyer assumed a $40,000 FHA insured first mortgage on a $50,000 single family residence D. a buyer assumed a $40,000 FHA insured first mortgage on a $50,000 single family residence Which best describes the difference between a fully amortized loan and a balloon note?

A. a balloon note shows no decrease in the loan balance, whereas a fully amortized loan shows a decrease as the payments are made B. a balloon note includes a balloon payment on interest where a fully amortized loan does not C. a fully amortized loan extinguishes the loan in equal payments, whereas a partially amortized loan does not D. a balloon note extinguishes the loan in equal payments, whereas a fully amortized loan does not C. a fully amortized loan extinguishes the loan in equal payments, whereas a partially amortized loan does not In doing a market analysis, you find a recently sold property where the owners had just gone through a divorce. It was listed for $60,000 for 3 months but sold for $40,000. Would you use this as a comparable? A. no, because it had only been listed for 3 months B. no, because of the divorce, it was not an arms length agreement C. yes, you would use the actual sales price of $40, D. yes, because it was a comparable type property B. no, because of the divorce, it was not an arms length agreement A property was worth $289,000 if capitalized at 4%. What is it worth if it capitalized at 5%? A. $185, B. $231, C. $300, D. $325, B. $231, $289,000 x 4% = $11,560 divided by 5% = $231, An heirloom chandelier in a house would be considered: A. chattel B. personal property C. a fixture D. a trade fixture C. a fixture An owner of a life estate died and the land passed to the remainderman. What interest would the remainderman receive? A. estate in reversion B. life estate C. estate at will D. estate in fee simple

D. estate in fee simple Which of the following BEST describes the extent of an owner's rights in land? A. the surface of the land only B. the land and five miles below certain mineral rights C. the surface of the land up to infinity D. the land from the center of the earth up to infinity D. the land from the center of the earth up to infinity Which of the following does NOT make loans? A. the secondary mortgage market B. the federal reserve C. savings and loans D. commercial banks A. the secondary mortgage market What can the VA require a veteran do when applying for a loan? A. make the down payment directly to the VA B. make a down payment in cash C. make the veteran immediately assume liability for the VA guaranty amount D. NOT allow the veteran to make prepayments on the principal amount C. make the veteran immediately assume liability for the VA guaranty amount Which of the following ways of advertising would be allowed under the Federal Truth In Lending Laws (Regulation Z)? A. $10,000 assumable loan in a working man's neighborhood B. shady acres - $10,000 down C. shady acres - guaranteed to double in value in 5 years D. shady acres - payments less than rent D. shady acres - payments less than rent A son and daughter in law wanted to buy their parents house and assume the mortgage. The son and daughter in law had just gone through bankruptcy. Which of the following clauses in a mortgage would prevent this sale and assumption from taking place? A. acceleration clause B. alienation clause C. subordination clause D. defeasance clause B. alienation clause

Which non governmental organization has its greatest investment in first mortgages on single family residences? A. insurance companies B. commercial banks C. savings and loans D. federal housing administration C. savings and loans Which of the following loans gives a borrower the lowest monthly payment? A. 8% interest, 20 year term B. 8% interest, 25 year term C. 9% interest, 20 year term D. 9% interest, 25 year term B. 8% interest, 25 year term Which of the following would be enforced by the Federal Trade Commission (FTC)? A. federal real estate settlement procedures act (RESPA) B. federal fair housing (title VIII) C. federal equal credit opportunity act (FECOA) D. federal truth in lending law (Reg Z) D. federal truth in lending law (Reg Z) Under which of the following circumstances would one MOST likely see an estoppel certificate? A. a lender sells a loan and the new mortgagee wants to know the existing balance B. a lender attempts to prevent a loan assumption to an unqualified party C. a developer attempts to have a parcel released from under a blanket mortgage D. a lender calls for full payment of a note A. a lender sells a loan and the new mortgagee wants to know the existing balance A single parent who receives child support payments is applying for a loan to purchase a house. The parent MUST disclose the child support to the lender if: A. applying for an FHA or VA loan B. gross income is less than $25,000 per year C. the child support exceeds 50% of income D. the child support will be considered as a basis for the payments D. the child support will be considered as a basis for the payments A ready, willing, and able buyer is one:

A. who can meet the seller's terms and conditions B. with whom the seller is personally satisfied C. produces an offer with earnest money D. produces an offer with earnest money that is also signed and dated A. who can meet the seller's terms and conditions A broker listed a $75,000 property and the agreement read that the owner would NOT take more than a 25% cash offer. The broker produced a buyer who offered a full price 100% cash offer. Would the broker be due a commission? A. yes, because the broker produced a ready, willing, and able buyer B. yes, because the offer was reasonable C. no, because the broker did NOT produce a buyer that fulfilled all the terms of the listing agreement D. no, because the broker violated the listing agreement by writing a 100% cash offer C. no, because the broker did NOT produce a buyer that fulfilled all the terms of the listing agreement A rental property manager's agreement allowed performance of normal maintenance and repairs. Which of the following acts would require the property manager to obtain the specific approval of the owner to do? A. fix a broken window B. repair the elevator C. renovate a unit for a tenant D. paint the outside trim C. renovate a unit for a tenant When a property is sold, the transfer tax is: A. normally paid by the buyer B. normally paid by the seller C. considered to be part of the brokerage fee D. considered to be part of the mortgage loan fee A. normally paid by the buyer A closing was to take place on June 15th. The sales price was $150,000. The seller's current loan balance was $115,000 with an 8% interest rate while the buyer was obtaining a 90% loan at 7%. The taxes of $600, paid in arrears, were to be prorated to closing with the seller being responsible for the closing date. What would be the amount of the tax proration? (use 30 day months and 360 day years) A. $ B. $ C. $ D. $

A. $

$600 divided by 360 days x 165 days = $ If a property sold for $3,000 per acre and the buyer bought 5 acres and one square mile, what was the total purchase price? A. $15, B. $1,920, C. $1,935, D. $2,500, C. $1,935, one square mile is a section of ground which contains 640 acres. 640 + 5 = 645 total acres x $3,000 = $1,935, Lots were being sold in a subdivision that required all building lots contain a minimum of .5 acres. This would be an example of: A. down zoning B. deed restrictions C. directive zoning D. discriminatory pricing B. deed restrictions A property had an area of 920 square yards with a 40 foot frontage. What was the depth of the lot? A. 23 feet B. 69 feet C. 207 feet D. 408 feet C. 207 feet 920 square yards x 9 = 8,280 divided by 40 feet equals a depth of 207 feet Which of the following statements BEST distinguishes general from limited partnership? A. limited partners are involved in the day to day running of the business B. general partnerships also must have limited partners C. limited partners are totally liable for all debts of a partnership D. limited partnerships also must have general partners D. limited partnerships also must have general partners

The area of a property that was 1/8 mile x 1/8 mile is: A. 5 acres B. 10 acres C. 12.5 acres D. 660 acres B. 10 acres 1/8 x 1/8 = 1/64 of a section of ground (640 acres). 640 divided by 64 equals 10 acres A broker listed a property for $87,500. While showing the property, a buyer remarked that $84,500 is what the buyer would like to offer for the property. The broker told the buyer that the seller will not accept anything less than $86,500. Did the broker do anything illegal under the Georgia License Law? A. no, because the broker tried to persuade the buyer to increase their offer by $2, B. no, as the seller can always reject the offer or make a counter offer to the buyer C. yes, as the broker must present the offer without any regards for the list price D. yes, as the broker cannot disclose to the buyer that the seller will take anything less than the list price D. yes, as the broker cannot disclose to the buyer that the seller will take anything less than the list price Georgia's law that is focused on deceptive advertising is: A. an anti trust law B. regulation Z C. UDTPA (Uniform Deceptive Trade Practices Act) D. FBPA (Fair Business Practice Act) D. FBPA Which of the following are appointed by the governor? A. members of the Georgia Real Estate Commission B. the Real Estate Commissioner C. real estate instructors D. Georgia Real Estate Commission employees A. members of the Georgia Real Estate Commission A seller and broker became embroiled in a commission dispute. What should the broker do? A. take the complaint to the circuit court B. file a complaint with the GREC C. file a complaint with the local association of Realtors D. file a complaint with the attorney general

A. take the complaint to the circuit court How are the members of the Georgia Real Estate Commission chosen? A. appointed by the Commissioner and approved by the Governor B. appointed by the Governor and voted in by the active commissioners C. appointed by the Senate and confirmed by the House D. appointed by the Governor and confirmed by the Senate D. appointed by the Governor and confirmed by the Senate A citizen phoned the GREC with a complaint on a licensee. The GREC sent him a form to fill out. However, he never followed up the complaint in writing. What would the GREC do? A. the GREC must follow up an oral complaint B. the GREC can NOT act on an oral complaint C. the GREC must ignore the complaint D. even though he did not put it in writing, the GREC may investigate anyway at their own discretion D. even though he did not put it in writing, the GREC may investigate anyway at their own discretion An attorney who is not a real estate licensee gives referrals to a real estate company. Can the attorney receive a referral fee from the licensee? A. yes, if it is the standard fee paid to the lawyer's firm B. yes, because the attorney does not actually sell the real estate C. no, as the attorney does not have a real estate license D. no, as an attorney cannot receive referrals by law C. no, as the attorney does not have a real estate license In order to sit for the Community Association Management (CAM) state licensing exam, an applicant must: A. complete a 75 hour approved course of study B. complete a 60 hour approved course of study C. complete a 25 hour approved course of study D. none of the above C. complete a 25 hour approved course of study A broker had several branch offices. Which is true regarding the management? A. he would have to have direct supervision over the main office and branch offices B. an associate broker can have direct supervision over the branch office C. a salesperson must have direct supervision over the branch offices D. each branch office must have a full time broker who does not sell or list B. an associate broker can have direct supervision over the branch office

A person has passed their state exam but has not yet received a license. Which of the following could that person NOT do? A. place "for sale" signs on a newly listed property B. type advertising copy C. give the address of a listed property to a buyer D. deposit money into a broker's escrow account C. give the address of a listed property to a buyer In dual agency, the consent form must contain all of the following except? A. a lot and block legal description of the property B. a statement that the client does not have to consent to the dual agency C. a statement that the agent will disclose all adverse known material facts D. a statement that the agent will disclose any material relationships A. a lot and block legal description of the property A salesperson was involved in a transaction that consisted of a 6 month lease and an option to purchase. Which of the following statements best describes how the salesperson should handle the documents? A. fill in the lease but not the option B. send the documents to an attorney and have the attorney prepare the forms C. fill in the option but not the lease as the lease was for 6 months or less D. fill in both the lease and the option on standard forms and take to the broker for review D. fill in both the lease and the option on standard forms and take to the broker for review A seller wants to list the property with a broker, but wants to avoid paying any commission should the seller be fortunate enough to sell the property. himself. Which of the following should the seller avoid signing? A. an exclusive agency listing B. an exclusive right to sell listing C. an open listing D. all listings

B. an exclusive right to sell listing Mr. Smith listed his farm with broker Bob. Although Smith did not tell him, Bob knew he had to sell due to poor health. What should Bob tell potential buyers? A. tell them of the illness only if they ask, but not the need to sell B. tell them of the need to sell to insure a quick sale C. do not tell them even though it appears that Smith's death is imminent D. in order to sell quickly, tell them that the seller is ill because death would cancel the listing C. do not tell them even though it appears that Smith's death is imminent In a cooperative sale, where the listing broker and the selling broker represent the seller, the selling broker has which of the following relationships? A. agent of the listing broker B. sub agent of the listing broker C. agent of the seller D. sub agent of the buyer A. agent of the listing broker A broker had an exclusive right to sell agency listing. In order to collect the commission, he must: A. prove he was the procuring agent B. prove he was licensed at the time of the sale C. prove he had a ready, willing, and able buyer that met the seller's terms D. all of the above B. prove he was licensed at the time of the sale A broker estimated the property lines by stating it ran between two trees in the back yard. After closing, the buyer found it was over six feet off. Is the broker liable? A. no, he gave an estimate B. no, the buyer should have gotten a survey C. yes, he made a statement which he realized could be false D. yes, the broker should have surveyed the property himself C. yes, he made a statement which he realized could be false Smith has an exclusive listing with broker Jones for $220,000. Jones finds a buyer who wants representation and Jones represents both Smith and the buyer, verbally disclosing that he is now representing both as clients. Has Jones violated license law? A. yes, because this is sub agency B. yes, because this is undisclosed dual agency C. no, because he disclosed to all parties that neither had to consent to dual agency

D. no, because he disclosed to all parties that his actions may be adverse to either party, however he would not divulge confidential information B. yes, because this is undisclosed dual agency A buyer and seller sign an agreement to change the contract to close on May 1 instead of May 2. This is a(n): A. addendum B. special stipulation C. amendment D. clause C. amendment When a person, upon payment of a consideration, has an obligation to buy land at a fixed price within a specified period of time, his right could be described as: A. a right of first refusal B. an option C. a sales contract D. either A or B C. a sales contract Joan has a listing with broker Bob. A week into the listing, Joan gets a call from broker Jill stating that the listing is now with her. Can this happen? A. it's ok as long as it was assignable in the original contract B. it's ok as long as the brokers have a written contract between them to transfer C. never due to the statute of frauds D. it cannot be assigned because a listing contract is a personal services contract D. it cannot be assigned because a listing contract is a personal services contract What type of transaction exists when there is a written contract for a broker to receive pay from both or either party and performs only ministerial acts for one or both parties? A. double agency B. transaction brokerage C. sub agency D. single agency B. transaction brokerage When is the correct time for the salesperson to get the proper legal description of the seller's property? A. when filling out the offer B. when filling out the sales contract

C. when filling out the listing D. any time before closing C. when filling out the listing Sue acquires an option to buy a tract of land from Pete. which of the following is NOT true? A. Sue is the optionee and Pete is the optionor B. the property may be purchased at the discretion of the optionee C. Pete may not diminish the value of the property (waste) during the period the option is in effect D. Pete may not sell the property to anyone else during the period the option is in effect D. Pete may not sell the property to anyone else during the period the option is in effect The contract signed between a buyer and a broker is called? A. listing contract B. buyer's brokerage agreement C. listing agreement D. buyer's relationship B. buyer's brokerage agreement Typically in Georgia, the agent representing the seller is called? A. the selling agent B. the listing agent C. the sub agent D. the listing broker D. the listing broker Which documents must be in writing to be enforceable according to the statute of frauds? A. leases over a year old B. real estate sales contracts C. deeds D. all of the above D. all of the above Seller Jane negotiates a sales contract with buyer Bill, but before signing the contract, she contacts buyer Mike to see if he wants to buy it before Bill does. Mike probably had: A. an option B. a right of first refusal C. a listing agreement D. both B and C

B. a right of first refusal Which of the following actions is the Georgia Real Estate Commission (GREC) authorized to carry out through the provisions of the Georgia Real Estate Law? A. fine an individual up to $5,000 operating in the capacity of a broker, without a license B. fine a broker up to $1,000 for multiple violations C. fine a licensee up to $5,000 for one conviction of moral turpitude D. refuse to issue a license to an applicant who falsified an application D. refuse to issue a license to an applicant who falsified an application In dual agency, the consent form must contain all of the following except? A. a lot and block legal description of the property B. a statement that the client does not have to consent to the dual agency C. a statement that the agent will disclose all adverse known material facts D. a statement that the agent will disclose any material relationships A. a lot and block legal description of the property A man had rented a place to live but had stayed beyond his lease without the owner's consent. This would be: A. an estate at sufferance B. an estate at will C. a periodic tenancy D. a tenancy for years A. an estate at sufferance Which would require compensation to be paid? A. police power B. condemnation C. escheat D. encumbrance B. condemnation Which is true about personal property? A. it is attached to the land B. it is considered appurtenant to the land C. it is immovable D. none of the above D. none of the above

A method of describing land using points, angles, and distances is which of the following? A. rectangular survey B. measurement by leaps and bounds C. plat of survey or lot and block survey D. measurement by metes and bounds D. measurement by metes and bounds Sam and Emma both used a driveway located on the boundary line between their two properties. When Sam died, would his heirs have the right to use the driveway? A. no, this right is not transferable B. no, this is an easement in gross and would not be transferable C. yes, this is an appurtenant easement and is inheritable D. yes, but they would have to pay Emma for her loss C. yes, this is an appurtenant easement and is inheritable How may a husband and wife take title to real estate in Georgia? A. joint tenants B. tenants by the entireties C. tenants in common D. either A or C D. either A or C ABC Incorporated was organized with five stockholders. How would ABC Incorporated the title to property? A. tenants in common B. tenants by the entirety C. joint tenants D. severalty D. severalty When is commission normally payable? A. upon the broker bringing a ready, willing, and able buyer B. upon closing C. upon presentation of the offer D. three days after closing B. upon closing Besides the seller, who may sign a real estate listing agreement?

A. the broker only B. any salesperson or broker C. the broker or any salesperson with the broker's written authorization D. the broker or an associate broker only C. the broker or any salesperson with the broker's written authorization A property listed with one broker was bought by a buyer who worked with another broker. The two brokers decided to split the commission. If the federal authorities found out about this they could: A. revoke the broker's licenses B. suspend the broker's licenses C. fine the brokers $1, D. do nothing D. do nothing If all the principals live in the same city, in which of the following cases would the broker most likely need a power of attorney? A. the owner of a manufacturing plant lists it with a broker B. a buyer contracted with a broker to purchase all properties put up for sale in that county C. a couple going through a divorce lists their property with the broker D. the XYZ Corporation, through its Board of Directors, authorizes the broker to sell a piece of property owned by the corporation B. a buyer contracted with a broker to purchase all properties put up for sale in that county An owner of a large estate told a broker he did not want an open house held on this property and wanted advertising in a national magazine only. Is this allowable? A. yes, the seller is responsible for planning all marketing of the property B. yes, the broker works for the seller and must follow all legal instructions of the seller C. no, the broker has the right to hold the house open at his own discretion D. no, the owner cannot limit the broker's ability to earn a commission B. yes, the broker works for the seller and must follow all legal instructions of the seller A salesperson listed a property for $68,000. Soon thereafter, another property that had also listed for $68,000 sold for $75,000. The salesperson should: A. tell the owner, as he had obviously made a mistake in the estimate of market price B. tell the owner that another had sold for $75, C. NOT tell the owner because he should not admit that he made an error, as he would get in trouble with his broker D. tell the owner because if it sells for $75,000, the commission would go up B. tell the owner that another had sold for $75,

Broker Bob listed two properties and arranged for an exchange of the properties. Which is true? A. this could only be done if they are both debt free B. broker Bob would typically be due the full commission on both properties C. the commissions would be added together and broker Bob would get one half D. there is no commission on an exchange B. broker Bob would typically be due the full commission on both properties One of the significant differences between an employee and an independent contractor is that: A. an independent contractor does not need an affiliation agreement with the broker B. an employer must pay an unemployment tax for each employee C. only the independent contractor can have draws against future commissions D. only the independent contractor has social security withheld from his or her commission checks B. an employer must pay an unemployment tax for each employee When a salesperson is negotiating a listing contract, she learns that the seller has an assumable loan. Should she discuss with the seller ways to assist a buyer in financing the property? A. no, because if the seller's loan is assumed, the seller will always remain in a vulnerable position B. no, because financing part of the purchase price would place the seller in a vulnerable position C. yes, because every seller's equity in his/her property must be reduced to avoid capital gains taxes D. yes, because the seller's willingness to assist in the financing by allowing the loan to be assumed and possibly taking a second mortgage may make the property much more marketable, which would be to the seller's benefit D. yes, because the seller's willingness to assist in the financing by allowing the loan to be assumed and possibly taking a second mortgage may make the property much more marketable, which would be to the seller's benefit A real estate salesperson intends to offer for sale a tract of land he inherited without listing it with a real estate brokerage company. Which of the following is NOT true concerning the marketing of this property? A. the salesperson must notify the broker in writing of his intention to sell the property B. in order to advertise the property, the salesperson must have his broker's written consent to do so C. in advertising the property, the advertisement must state, "owner is a licensed real estate agent acting as a principal D. the salesperson must offer the property through his broker's company. He may not advertise the property except as a listing of his company D. the salesperson must offer the property through his broker's company. He may not advertise the property except as a listing of his company Most brokers will insert a protection clause in their listing contracts. This clause will usually allow:

A. the listing of a house to automatically extend for an additional 30 days if the house is not sold during the agreed term or the listing B. a broker, who had procured a buyer before the expiration of the listing, to receive a commission even though negotiations were completed after the expiration date of the listing C. the listing agent has the first right of refusal in the event the house is not sold during the term of the listing D. none of the above are true B. a broker, who had procured a buyer before the expiration of the listing, to receive a commission even though negotiations were completed after the expiration date of the listing Salesperson Dole was licensed under broker Carr but sold a property that was listed by broker Faulk. From whom would salesperson Dole collect a commission? A. broker Carr only B. broker Faulk only C. bother broker Carr and Faulk D. the owner of the property A. broker Carr only Buyer Burke has authorized broker Rand to purchase a property on his behalf. What kind of agent is broker Rand? A. general agent B. special agent C. universal agent D. secret agent B. special agent Which is the best example of functional obsolescence? A. residential home built next to a meat processing plant B. a roof that is severely sun damaged C. a three bedroom home with one and a half baths and a single car carport D. residential home with central heating and air conditioning C. a three bedroom home with one and a half baths and a single car carport Adjustments for advantageous financing would be made in the: A. market comparison approach to appraisal B. cost approach to appraisal C. income approach to appraisal D. capitalization approach to appraisal A. market comparison approach to appraisal

A market where there is an excess of supply over demand is known as a: A. buyer's market B. broad market C. seller's market D. thin market A. buyer's market Which of the following is not a principle of value? A. substitution B. assemblage C. conformity D. depreciation D. depreciation A loan in which the buyer pays off the total principal at the end of the loan is a: A. partially amortized B. straight term C. principal + interest D. amortized loan B. straight term A lender would require a blanket mortgage in which of the following circumstances? A. if the borrower was going to use several unencumbered properties as security B. if there was a mortgage clause stating that upon default, it would become a general lien C. if the lender made the loan to encompass all of the borrower's debts D. none of the above A. if the borrower was going to use several unencumbered properties as security Which loan will give a borrower the lowest monthly payment? A. 10% interest, 20 year term B. 10% interest, 25 year term C. 11% interest, 20 year term D. 11% interest, 25 year term B. 10% interest, 25 year term Which factor would influence a lender LEAST in making a loan? A. the present value and future value of the property B. the income and income potential of the borrower

C. the borrower's need of financial assistance D. the attractiveness of other investments C. the borrower's need of financial assistance A homeowner with a mortgage replaced it with a new mortgage 3% lower in interest and obtained extra funds to make investments. This is called: A. subordination B. refinancing C. subrogation D. wraparound B. refinancing In a repayment of a mortgage loan, which type of interest is used? A. simple B. discounting C. compound D. floating A. simple When obtaining an FHA loan, which generally happens? A. an FHA approved appraiser appraises the property B. FHA makes the loans directly to the borrower C. the borrower makes the down payment directly to the FHA D. none of the above A. an FHA approved appraiser appraises the property What does the VA require a veteran do when applying for a loan? A. make the down payment directly to the VA B. make a down payment in cash C. make the veteran assume liability for the loan D. NOT allow the veteran to make prepayments on the principal amount C. make the veteran assume liability for the loan An option was given on a home for consideration of $1,000. When would the broker's fee be earned? A. it was earned when he brought the optionor and the optionee together B. the broker's commission would come out of the $1,000 fee C. half of the commission is earned now and half when the option is exercised D. none of the above

D. none of the above Which BEST describes the sale price for a property in an option agreement? A. the sale price would be determined when the option is exercised B. the buyer is guaranteed a fixed price when the option is signed C. the buyer can purchase the property by matching any other offer D. the optionor is obligated to pay the sale price when the option is exercised B. the buyer is guaranteed a fixed price when the option is signed Where may a salesperson get the legal description of a property for insertion into the sales contract? A. by copying it down from the seller's warranty deed B. by drafting a new description from the survey C. by copying it down from the seller's security deed D. either A or C D. either A or C If a seller agrees to take a purchase money mortgage from a buyer as a second mortgage, which of the following statements would be true about the intangibles tax? A. intangibles taxes are not applicable to second mortgages, only to first mortgages B. any intangibles tax must be paid by the seller because the seller holds the mortgage C. any intangibles tax must be paid by the buyer because it was for the buyer's benefit that the loan was made D. either party can pay the intangibles tax D. either party can pay the intangibles tax When a property is being sold on an assumption of the existing loan, complications with the transfer of some mortgage loans can be: A. the purchaser may have to qualify with the lender as if it were a new loan B. the purchaser may have to pay a higher rate of interest C. the loan may be non assumable and due in full if the seller transfers ownership D. all of the above D. all of the above The purpose of the earnest money is to: A. assure there is some valuable consideration B. help assure the purchaser's performance C. assure the seller's performance D. satisfy the Commissions requirements for sales contracts B. help assure the purchaser's performance

When a salesperson prepares an offer to purchase on a property listed with another real estate firm, he/she should recommend to the customer that the earnest money check be made payable to: A. the selling salesperson B. the selling company C. the listing salesperson D. the listing company D. the listing company If a purchaser tells a salesperson to hold the purchaser's earnest money check for 5 days before depositing it, the salesperson must: A. deposit the check in the broker's trust account as soon as practicable B. hold the check until the 5th day and then deliver it to her broker C. deliver the earnest money check to the broker as soon as practicably possible, with the purchaser's written instructions for the broker to hold the check D. tell the purchaser the check won't clear in less than 5 days C. deliver the earnest money check to the broker as soon as practicably possible, with the purchaser's written instructions for the broker to hold the check If a purchaser tells the salesperson that the seller has clearly breached his responsibilities and the purchaser demands the immediate refund of his earnest money deposit, the salesperson should: A. calm the purchaser down and assure him that the broker will return the funds in no more than one week's time B. tell the purchaser to see his own attorney since the salesperson is not allowed to give legal advice C. tell the purchaser that the most he can take without the seller's agreement is half of the deposit D. tell the purchaser that she will forward his request to her broker and that the broker or she will get back to the purchaser quickly with a response D. tell the purchaser that she will forward his request to her broker and that the broker or she will get back to the purchaser quickly with a response Examples of activities subject to the Sherman Antitrust Act include all EXCEPT which of the following? A. arranging for a homeowner's insurance policy through a local office of a company whose headquarters are located in Jacksonville, FL B. Advertising a Georgia beach front property in publications distributed throughout the state C. obtaining financing for a property in Georgia through a mortgage broker who represents an out of state savings and loan association D. referring a Georgia resident, who is relocating to Colorado, to a Colorado real estate firm B. Advertising a Georgia beach front property in publications distributed throughout the state Any person violating the anti trust laws is guilty of:

A. a misdemeanor B. a violation of the Federal Fair Housing Law C. a felony D. fraud C. a felony May a company enforce a policy of non negotiation of commission rates? A. yes, as long as its competitors agree to do the same B. no, this would be collusion C. yes, as long as rates are set independently based on actual cost in providing a service and as long as the consumer understands that other companies and licensees may have different policies and rates D. yes, as long as it is a part of the company policy manual C. yes, as long as rates are set independently based on actual cost in providing a service and as long as the consumer understands that other companies and licensees may have different policies and rates Which of the following activities is illegal? A. price fixing if real property B. unreasonable refusals by real estate boards to accept new members C. rate fixing of real estate commissions D. all of the above D. all of the above The Sherman Antitrust Act has as one of its purposes to: A. prohibit conspiracy in the restraint of trade B. guarantee businesses some protection from federal income taxation C. prohibit kickbacks in regard to providing settlement services D. guarantee non business consumers some protection against hidden credit costs A. prohibit conspiracy in the restraint of trade A home is listed at an inflated price and requires all minority prospects to pay that price. However, if a lower price is accepted from a non minority prospect, this practice: A. does not violate Fair Housing Laws because the home is still being made available to minority prospects B. subjects the seller and the seller's agent to liability for money damages under a Fair Housing suit C. is a violation by the seller only D. is illegal only if the purchase of the house is being financed through FHA or VA B. subjects the seller and the seller's agent to liability for money damages under a Fair Housing suit Price fixing between brokers is a violation of federal antitrust laws. If your broker fixes prices with another broker, he or she may:

A. be found guilty of a criminal offense B. be found civilly liable to injured persons C. face disciplinary proceedings by the Real Estate Commission D. all of the above D. all of the above Which of the following activities is permissible for a broker? A. recording a listing contract that creates a lien for the purpose of causing a cloud on the title B. accepting an oral listing from an owner and placing a "for sale" sign on the property C. obtaining an exclusive listing from an owner while knowing that another broker has the property exclusively listed D. none of the above D. none of the above As long as a salesperson serves a seller under a listing agreement with the salesperson's broker, that salesperson must always represent which of the following? A. the seller B. the buyer C. that salesperson's broker D. whichever broker delivers an offer C. that salesperson's broker Georgia law requires that licensees disclose who they represent in writing? A. at the first meeting B. at closing C. no later than the time of the written offer D. it is not required, but is suggested C. no later than the time of the written offer Security deposits kept in a designated rental trust account are credited to: A. the broker B. the tenant C. the landlord D. the lessor B. the tenant In order to provide brokerage services for an unlicensed individual such as a developer, builder, or management company, a licensed salesperson or associate broker must:

A. work through a listing agreement established by his or her broker with the unlicensed party B. give up his or her license entirely before beginning work C. neither of the above D. either A or B D. either A or B which of the following best describes a blind ad? A. one which is not directed at any consumer segment B. one which is directed at all consumer segments C. one which fails to disclose that the advertising party is licensed by the Commission (active or inactive) D. one which fails to disclose that the advertising party is the seller C. one which fails to disclose that the advertising party is licensed by the Commission (active or inactive) An associate broker may: A. advertise property owned personally without mentioning that he/she is licensed B. sign transfer and release forms of licensees coming to or leaving the company, if he/she has written permission of the broker C. accept earnest money from salespeople just as the broker may, because an associate broker is the same as a broker D. all of the above B. sign transfer and release forms of licensees coming to or leaving the company, if he/she has written permission of the broker A salesperson wants to purchase a building for personal reasons. Before presenting the offer, he must: A. state in the offer that he is a licensed real estate salesperson B. furnish the Real Estate Commission with a copy of any offer he signs and/or presents C. inform the broker of his intentions so that no commission will be paid D. none of the above A. state in the offer that he is a licensed real estate salesperson In order to be eligible to take the real estate broker's examination, an applicant must be in which of the following situations? A. have completed an approved broker's course of study and served at least 3 of the past 5 years as an active licensee B. have completed an approved broker's course of study and served at least 2 of the past 5 years as an active licensee C. have completed at least 50 in class hours of a broker's course of study and served at least 3 of the past 5 years as an active licensee D. be a resident of the state of Georgia and be registered in and attending a broker in class course of study