BARNEY FLETCHER - GA RE SCHOOL EXAM QUESTIONS, Exams of Social Sciences

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BARNEY FLETCHER - GA RE SCHOOL EXAM

QUESTIONS

What is the tax assessment rate for all real property in Georgia? - Answers - 40% What could happen if a property is sold at foreclosure and does not bring enough money to satisfy all of the debts secured by the property? - Answers - Outstanding debts could be pursued as a result of a deficiency judgement When foreclosure occurs, the payment priority of most of the outstanding debts is established by: - Answers - Date of recordation With a traditional, fully amortized loan, the interest portion of a payment due and made on the first day of a month covers the interest for: - Answers - the month prior to the month the payment is made What type of loan has payments of interest only with the principal paid in full at the end of the loan period? - Answers - Straight loan What type of mortgage exists when the lender pays the borrower a fixed amount of money every money? - Answers - Reverse Annuity (mortgage) The primary purpose of FHA is to _____ and the primary purpose of VA is to ________.

• Answers - Insure loans; guarantee loans In a Land Sales Contract, who retains legal title to the property? - Answers - Seller What Act has as its primary purpose to educate borrowers regarding the costs involved in a closing so that the borrowers can shop for the best situation for them? - Answers - Real Estate Settlement Procedures Act (RESPA) Which of the following is true regarding a borrower's mortgage payment assuming the payment is made on time? - Answers - The payment includes payment of interest for the previous 30 days Professional appraisals for lenders are usually made in order to: - Answers - help the lender decided whether to make a loan If you have several comparable properties as a part of your market analysis, how do you combine the values reached on each in order to estimate the value of the subject property? - Answers - By weighing the adjusted sales prices of the comparables and adding the weighted dollar amount of the group

Real estate agents look to many different sources when working on a market analysis. Which of the following sources would have the greatest effect on establishing the property's value estimate? - Answers - Recently sold comparable properties The four economic characteristics of value are: - Answers - Demand, Utility, Scarcity, Transferability When buyer and seller operate with knowledge and no undue pressure in consummating a transaction, it is known as a(n): - Answers - Arms-length transaction The type of deprecation used by appraisers in which the amount of depreciated value is equal each year is known as the: - Answers - Straight line method If a loan balance is $125,000 and the interest rate is 8%, how much of the next payment is paid in interest? - Answers - $833. In a graduated payment mortgage, the ________ changes in an adjustable rate mortgage the _______ is subject to change. - Answers - Payment, interest rate What clause allows the lender to call the loan balance due and payable because of non- payment? - Answers - Acceleration clause The amendment that allows a lender to waive his lien priority in favor of another's is known as the: - Answers - Subordination amendment A purchase money mortgage is a loan made by: - Answers - The seller in a transaction A mortgage secured by both real and personal property is a(n): - Answers - Package Mortgage The value principle which indicates that a buyer will not pay more for a property than a price for which he can obtain a property of equal utility is the principle of: - Answers - Substitution When the total value of combine properties exceeds the total value of the individual properties, the result is know as: - Answers - Plottage increment Which of the following best describes Transfer Tax? - Answers - A state tax which is based on the sales price of the property less any assumed loans at the rate of $.10/$100 of the taxable amount. Which of the following does NOT have to be in writing to be enforceable? - Answers - Lease for one year or less The purchase price of the property was $70,000. The purchaser obtained a 90% loan. What is the amount of the intangibles of the tax due? - Answers - $

If there is a closing on February 22 and taxes are $2,275 annually, how much tax proration will the seller owe at closing (within a dollar)? - Answers - $ The closing was on June 23. The loan balance as of the June 1 payment was $85,440. The loan had an interest rate of 11%. Payments were due the first of each month. The lender used a 360 day year. How much accrued interest did the seller owe? - Answers - $600. The sales price of the property is $120,000. The new loan is $114,000. How much will the transferable tax be? - Answers - $ If a new loan is closed on June 2, how many days of interest adjustment will be owed? - Answers - 29 Anyone other than a salesperson who acts as a licensee on behalf of a broker is a(n): - Answers - Associate Broker Which of the following is true about the Georgia Real Estate Commission? - Answers - There are five licensed commission members. Which of the following is true about the Georgia Real Estate Commissioner? - Answers - He is hired by the commission. Commission members are: - Answers - Appointed by governor and approved by the Senate Which of the following satisfies the requirements for the required Post-License course? - Answers - 25 - hr. course taken within on year from the day of license activation. Upon renewal of a license, a licensee must pay all fees due and complete _______ hours of continuing education, if education is required. - Answers - 36 A licensed broker in another state may enter into a co-op agreement with a Georgia Broker through a written agreement which includes: - Answers - That any advertising of Georgia property identify the listing Georgia broker. An individual who successfully passes the state examination and has otherwise qualified for a license has ___________ months to activate or place inactive his/her license. - Answers - 12 If a real estate company operates as a limited partnership, which of the following is true about the qualifying broker? - Answers - He must be the general partner

Under what circumstances may a broker have more than one escrow account? - Answers - As long as the Commission is notified of pertinent information regarding each account. What are the requirements for salespeople and associate brokers who receive trust funds or security deposits on their own rental property? - Answers - They may place those funds either their broker's trust account or a trust account approved by their broker. There must be a minimum balance of $__________ in Education, Research and Recovery fund at all times. - Answers - $1,000, The limit of liability for a single transaction in which a licensee is involved in $________ and the limit o liability for multiple transactions for a single licensee is $__________. - Answers - 25,000; 75, If the Education, Research and Recovery Fund falls below the required minimum balance, what may happen? - Answers - Each licensee can be assessed up to $30 per year at time of renewal. Which of the following is an unfair practice under the License Law if performed by licensee? - Answers - Paying commission to an unlicensed person. Which of the following statements is true about chairperson of the Georgia Real Estate Commission? - Answers - Any commission member may be elected chairperson. In Georgia, net listings are: - Answers - Illegal Which of the following is required or true when salespersons or associate brokers are advertising to buy or sell their own properties in their own properties in their own name?

• Answers - The broker has been notified in writing of the specific property involved. Is the statement, A person licensed as an associate broker with one firm may also be the qualifying broker with one or more other firms as long as he notifies his broker in writing, true or false? - Answers - True A broker must conduct his business in the name: - Answers - Under which his license was issued Under what circumstances may a broker refuse to sign a release/transfer form for a licensee to transfer to another firm? - Answers - Under no circumstances How may a license be reinstated after a licensee has voluntarily surrendered it? - Answers - By qualifying as an original applicant

What is the proper procedure if the "form" contract does not suit needs of the parties to the transaction? - Answers - The agent should consult with his/her broker before proceeding. If a property is being sold "As is" what is the effect on the agent's responsibilities? - Answers - An "As Is" contract has no effect on agent's responsibility to disclose all known defects to all parties in the transaction If the contract calls for the earnest money to be held until the contract has been accepted, who is authorized to hold the earnest money? - Answers - Anyone, other than a salesperson or associate broker, designated in the contract to hold the earnest money. Which of the following is NOT a reason for a sales contract to be in writing? - Answers - To make it valid If a written offer is made after the property is under contract, but before closing, what is the proper action? - Answers - It must be presented to the seller. What is the term used to describe those acts which a broker or affiliated licensee performs for a non-client which do not require discretion and do not create a brokerage relationship? - Answers - Ministerial Acts Under BRRETA, what is the term used to identify the agreement in which a buyer and a broker establish an agency affiliation? - Answers - Buyer Brokerage Engagement Which of the following is true regarding a licensee selling his/her own property which is listed with his/her firm? - Answers - There must be a clause in the contract disclosing the agent's license status. Who is responsible, under the license law (salesperson), for seeing that both the purchaser and seller obtain a copy of that closing statement? - Answers - The Broker Intangible Tax Formula - Answers - SP x LTV = LA (LA / 500 (rounded up)) x 1.50 = Accrued Interest Formula - Answers - (LB x IF)/360 x (#days owe) = Pre-Paid Interest: Interest Adjustment Proration (new loans only) - Answers - (LA x %(IR)) / 360 x (#days owe) = Interest adjusted Days of interest owed - Answers - Days in month

• closing date

• 1 = days of interest owed

Tax Proration - Answers - (tax bill / 365) x # days owed Before July 1 - not paid After July 1 - paid Transfer Tax (as new loan) - Answers - SP/1, Down Payment - Answers - SP - Loan Amount Measuring Acreage and Sqft calculations - Answers - 43,560 (4 old ladys, going 35 in

L x W = sqft Sqft/43560 = acres GRM (Gross Rent Multiplier) - Answers - SP / Rent = GRM GRM x rent = value PGI (potential gross income) and NOI (Net listing income) formula - Answers - PGI

• Vac
• Oper = NOI NOI (always dividen) / Value = Rate NOI / Rate = Value Value x Rate = NOI Annual Interest - Answers - LA x IR(%) = Annual Interest Alice purchased a home and financed it using a mortgage which included the term "amortized over 30 years, due and payable after 10 years." Which of the following statements is correct? - Answers - The loan is partially amortized loan AND The loan will have a balloon payment Sara is a new licensee who paid for and enrolled in an approved post-license course 10 months after her license was issued, but has failed to compete the court within the allowed 1 year. Sara has one client who is looking at several properties, and one client who has signed a contract on a house. Which scenario best describes Sara's situation?
• Answers - Sara cannot present the contract, and cannot show houses, and must complete her course within 18 months of her license date In order to qualify for a broker's license an applicant must: - Answers - Complete an approved course and have at least 3 years as an active licensee

When an out of state person who is not licensed in another state wants to apply for a Georgia Real Estate License he must: - Answers - Meet the same requirements as a Georgia original applicant