Colibri Real Estate Exam 2024/2025 | Accurate Currrent Testing Questions With Detailed An, Exams of Real Estate Management

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Colibri Real Estate Exam 2024/2025 | Accurate Currrent Testing

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Sam, a broker, thought the postage meter stamp was sufficient evidence of a U.S. Postal Service postmark. He was wrong and his broker's license expired. What happened next? - CORRECT ANSWER Sam must immediately stop his licensed activity. His salespersons are all placed immediately in non-working status, and his branch office licenses are cancelled. He must then take all necessary steps to re-activate his license, his salespersons' licenses and the branch office licenses. The law judge has just issued a decision based upon the findings in a formal hearing of a real estate salesperson for various ethical violations. What could the California Real Estate Commissioner do at this point in the proceeding? - CORRECT ANSWER - Reject the proposed decision

• Accept the proposed decision
• Reduce the proposed penalty and make an official decision. Final Answer: All of the above Sam has successfully completed the Real Estate Principles course, the Real Estate Practices course, an additional college level course, and passed the salesperson licensing examination. Which license is available to Sam? - CORRECT ANSWER The Four-Year Salesperson License Katrina had her license suspended for making false promises to clients. She had a habit of telling clients what they wanted to hear and never being able to state the facts. Of course, she could never follow through with her statements and several complaints were filed. Which guidelines constitute most suspensions? - CORRECT ANSWER Sections 10176 and 10177 of the Business and Professions Code. Jan failed to renew her license prior to its expiration. In order to renew her license now Jan must:
• CORRECT ANSWER - Submit a proper application within 2 years of her license expiration.

• Providing evidence of the completion of current required continuing education.
• Pay the appropriate late renewal fee. Final Answer: All of the above. The main purpose of the California Department of Real Estate (DRE): - CORRECT ANSWER To protect the public. Miguel sits down, ready and prepared to take the examination. He neatly places his slide rule, programmable calculator, single piece of scratch paper, answer sheet, pencil and pocket-size electronic calculator on the desk and he is ready to begin. Although extremely prepared, which item of Miguel's is NOT permitted in the testing site? - CORRECT ANSWER The programmable calculator Marc needs to score 12 points higher on the California State Licensing exam this time to earn a passing score. What was his initial exam score? - CORRECT ANSWER Marc's initial exam score was 58% based on the required passing score of 70%. Lydia has decided to actually spend a considerable amount of time STUDYING for the exam this time, in hope of earning a passing score. Her application has expired in the two years of fruitless reexaminations. What does she need to do to reapply? - CORRECT ANSWER File the Salesperson Examination Application (RE400A) along with the appropriate fee. Sara waited and waited and waited for what she thought was a lifetime. Finally, Thursday morning the results of her California real estate examination arrived. What was the maximum length of "the lifetime" Sara waited and could she have gotten her results by another method? - CORRECT ANSWER Sara's lifetime wasn't too long. The results are normally mailed out in five days. She could have also received her results online through the eLicensing system and through the Interactive Voice Response system. Raj is stressed. He is getting ready to take the salesperson examination and doesn't know where to begin studying. Help Raj by telling him the examination topic(s) with the largest concentration of questions. - CORRECT ANSWER Practice of Real Estate and Mandated Disclosures

Lydia applied for the salesperson examination in January 2014. She sat for the exam three times in 2014 and four times in 2015. Each time, Lydia did not receive a passing score. How many times may Lydia sit through the examination in 2016? - CORRECT ANSWER Lydia may re- take the examination as many times as it takes to earn a passing score, but her application will expire in January and she must reapply first. John completes the Salesperson Examination Application and submits it to the California Department of Real Estate. Driving home from work, he realizes he used his old address and not his new one on the application. What should he do? - CORRECT ANSWER Once a completed Salesperson Examination Application is submitted to the DRE, no changes of any kind may be made to the application. Lydia feared she did not pass the California State Licensing Exam AGAIN. As she nervously opened the envelope that held the results, what was the first clue to the outcome of her reexamination? - CORRECT ANSWER She did NOT receive an actual score this time in the mail. This means she finally passed the licensing exam, and her license application is included in the envelope. Mikela wants to research and study the requirements for the California Real Estate Examination Test. Where can she find the exam's purpose and requirements? - CORRECT ANSWER California Business and Professions Code Section 10153 Joe Alpha of ABC Real Estate Corp. has been very successful in buying houses, fixing them up, and reselling them. He put an advertisement in the local newspaper seeking investors to help him purchase property and pay for renovations, promising an excellent return on investment when the properties sold. Do you think that Joe needs a securities broker-dealer license? - CORRECT ANSWER No Ellie is very regimented. She likes to be in the office by 8 a.m. and be home by 5:30 p.m. She likes that same precision in her monthly budget—she wants to know what's coming in and how much she can expect to put into her IRA. She is a good candidate for a career in real estate sales.

• CORRECT ANSWER False Phil, a real estate licensee, considers going to work for JJ Realty. Broker Jana James offers him a 60%-40% split on commission. If JJ Realty takes in $5,000 total commission on Phil's first sale, what is Phil's split? - CORRECT ANSWER $3,

A real estate licensee is more likely to be an employee of his broker. - CORRECT ANSWER False If a broker supervises the real estate activities of an associated licensee, that licensee CANNOT be considered an independent contractor. - CORRECT ANSWER False A real estate licensee who is an independent contractor is paid based on successful real estate transactions, not on hours worked. - CORRECT ANSWER True Generically speaking, a person who, for a fee, sells, lists, leases, exchanges, negotiates, or otherwise deals in the real estate of others or represents publicly that they do so. - CORRECT ANSWER Broker A business that serves as an intermediary between buyers and sellers and/or lessees and lessors of real estate. - CORRECT ANSWER Brokerage Insurance that protects real estate licensees from liability due to mistakes or negligence. It does not cover claims related to fraud or discrimination. - CORRECT ANSWER Errors and Omissions Insurance (E&O) Under common law, a person who contracts to do a job for another but maintains control over how the task will be carried out, rather than following detailed instructions. - CORRECT ANSWER Independent Contractor A person licensed under state law to practice real estate. - CORRECT ANSWER Licensee Any real estate licensee who is a member of the National Association of REALTORS® (NAR) and his or her affiliated state/local boards. Only members may use the term REALTOR® as it's a registered trademark of NAR. - CORRECT ANSWER REALTOR® Generically speaking, a real estate licensee agent who is associated with a broker and as such may perform most of the acts a broker can on behalf of the broker. Also called Sales Associate. - CORRECT ANSWER Salesperson

A real estate licensee who is treated as an independent contractor for tax purposes when specified conditions are met: proper licensing; compensation based on sales; and services performed under a written contract. - CORRECT ANSWER Statutory Nonemployee In which field do the majority of new licensees begin their work? - CORRECT ANSWER Residential Sales Which is NOT an advantage to a career in real estate sales? - CORRECT ANSWER the option to double commission percentages during slow months Licensee Louie has worked for Rick, the broker at ABC Realty, for 20 years. Louie has been accused of negligence for not disclosing a material fact to a buyer. Which statement is TRUE? - CORRECT ANSWER Rick can be held liable for Louie's misconduct. At the end of the year, what tax form will an independent contractor receive to document their income? - CORRECT ANSWER 1099-MISC Who could a real estate licensee represent in a real estate transaction? Select all correct responses. - CORRECT ANSWER Buyers Landlords Sellers Tenants All are correct Steven just successfully finished his required real estate prelicensing course. Which statement is TRUE? - CORRECT ANSWER Once he joins the NAR, he can call himself a REALTOR®. In order to be considered an independent contractor, a licensee's compensation must be - CORRECT ANSWER based on sales produced, not hours worked.

For a real estate licensee, which is NOT a characteristic that indicates they are an independent contractor? - CORRECT ANSWER The licensee must be paid for hours spent in the brokerage office. What are the tasks for which a property manager is typically responsible? Select all correct responses. - CORRECT ANSWER Collecting Rents Leasing Units Maintaining Tenant Relationships Managing the Maintenance and Repair of the Building All are correct The theory of supply and demand states that when supply exceeds demand, prices will fall. - CORRECT ANSWER True Real estate cycles tend to lag somewhat behind general business cycles in response to supply and demand. - CORRECT ANSWER True As the supply of homes in the area rises, what would you expect to happen to home prices in the short term? - CORRECT ANSWER Home prices will fall slightly from their high points. When Widget moves out, what type of market is Big City likely to experience? - CORRECT ANSWER Buyer's Market Cost inflation can affect new home prices as builders pass along their higher costs for labor and materials. - CORRECT ANSWER True Higher taxes tend to encourage spending and investing. - CORRECT ANSWER False P-E-G-S - CORRECT ANSWER Physical Economic

Government Social A situation in the housing market when there are many homes available for sale, but few buyers.

• CORRECT ANSWER Buyer's Market The interest rate that people or businesses must pay to use another's money for their own purposes. - CORRECT ANSWER Cost of Money The main business or industry in an area that supports and sustains the community. - CORRECT ANSWER Economic Base An increase in the cost of goods or services or too many people wanting too few goods. - CORRECT ANSWER Inflation A characteristic of real property; each piece of land, each building, and each house is a unique piece of real estate. Also called Uniqueness or Heterogeneity. - CORRECT ANSWER Non- Homogeneity General swings in real estate activity, resulting in increasing or decreasing activity and property values, during different phases of the cycle. - CORRECT ANSWER Real Estate Cycles A physical characteristic of real property that says there is a limited supply of real estate; the perceived supply of a good or service relative to the demand for the item. - CORRECT ANSWER Scarcity A situation in the housing market when a large number of buyers are looking for houses in an area of limited availability. - CORRECT ANSWER Seller's Market An economic principle that says that for all products, goods, and services when supply exceeds demand, prices will fall and when demand exceeds supply, prices will rise. - CORRECT ANSWER Supply and Demand

These associates take and approve loan applications, appraise properties, assess risk. They can find jobs with savings and loan associations, mutual savings banks, commercial banks, mortgage companies, endowments, and government agencies. - CORRECT ANSWER Real Estate Finance People in this field use rigorous appraisal methods to evaluate property for financial institutions, developers, property managers, or government agencies. - CORRECT ANSWER Real Estate Appraisal These professionals purchase large tracts of land at a low cost per acre, then subdivide and improve it with streets, sewers, and utilities so it can be resold at a higher cost per front foot (for lots) or per square foot (for buildings). - CORRECT ANSWER Real Estate Development People in this area of real estate build homes on contract or speculation. They might choose to sell, appraise, manage, or help buyers finance the property. - CORRECT ANSWER Real Estate Property Construction This is a growing field. More and more brokers, banks, and lawyers are getting into this service area as profit margins are shrinking elsewhere. Jobs can include title researcher, escrow agent, and title insurance overseer. - CORRECT ANSWER Real Estate Title Work There are numerous national, state, and local trade associations that work to educate, lobby, support members, and manage public relations. - CORRECT ANSWER Real Estate Trade Association Work Continuing education is part of maintaining a real estate license. Educators have ample opportunities to teach these courses. - CORRECT ANSWER Real Estate Education. This work can be for the FHA, VA, Fannie Mae, Ginnie Mae, Freddie Mac, and HUD and for state and county work, such as urban planning. - CORRECT ANSWER Real Estate Government Work

include single-family residential properties, multi-family properties (from a double to a large apartment building), condominiums, or cooperatives. Specialized residential properties can include converted-use property, manufactured housing, and timeshares. - CORRECT ANSWER Residential properties include offices, stores, hotels, and other buildings. Those dealing in commercial properties are usually involved not only in sales and other aspects of brokerage, but also in leasing and leasebacks, property management, and even construction or financing. - CORRECT ANSWER Commercial properties include land and structures involved in the production, distribution, and storage of tangible economic goods. - CORRECT ANSWER Industrial properties include selling farms or selling large areas to subdivide and develop. - CORRECT ANSWER Farm and vacant land This varies by agency and can include filling out forms and contracts, closing a sale, selling your services, and attracting new listings. - CORRECT ANSWER Training These are the tools (websites, email, online forms), advertising, and staff support that help you do your job. Many brokerages supply these things as part of your agreement with them; some charge a nominal fee; others require you to provide them yourself. - CORRECT ANSWER Brokerage Services Payment comes from the broker, not from the buyer or seller. You may split the compensation (50%-50% or some other percentage) or get 100%. The amount you pay for brokerage services is often impacted by how much commission you receive. (More commission, the more you will have to pay for services.) - CORRECT ANSWER Compensation You can be an independent contractor (which the IRS calls a statutory nonemployee) or an employee. Independent contractors have to do more administrative tasks, such as pay quarterly taxes. - CORRECT ANSWER Relationship

For contractors, the specifics of the broker-agent relationship should be spelled out in an _____________ that is signed by both parties. - CORRECT ANSWER Independent Contractor Agreement (ICA) Most ICAs will address - CORRECT ANSWER expenses, commission, and brokerage representation. Factors that affect the real estate market - CORRECT ANSWER PEGS Physical Economic Governmental Social influence real estate markets include location, immobility (land cannot be moved), uniqueness (land cannot be duplicated, and no two parcels are the same) and scarcity (land cannot be created). - CORRECT ANSWER Physical Factors influence real estate markets include business cycles, housing cycles, supply and demand, inflation, cost of money (interest rates), and the economic base of an area - CORRECT ANSWER Economic Factors general swings of increasing or decreasing activity and property values; they depend on business cycles. - CORRECT ANSWER Housing Cycles impacts buyer's markets and seller's markets. - CORRECT ANSWER Supply and Demand Supply and demand impacts - CORRECT ANSWER Buyer's markets and seller's markets increase in cost of goods or services. - CORRECT ANSWER Inflation

the interest rate one must pay to use another's money - CORRECT ANSWER Cost of money the main business or industry by which a community supports and is critical to maintaining home values and is a primary factor in determining the supply of real estate. - CORRECT ANSWER Economic Base influence real estate markets on state and local levels include revenue generating laws (taxation and specific tax policies) - CORRECT ANSWER Governmental Factors influence real estate include demographics, population growth, population age, the family size, and population migration. - CORRECT ANSWER Social Factors What can be considered is the most important factor in determining supply in the real estate market? - CORRECT ANSWER Economic Base of an Area What would more MOST LIKELY to contribute to a seller's market? - CORRECT ANSWER High Construction Costs BigTime Manufacturers are getting ready to build a new factory in Smithton that should attract hundreds of new workers to the small town. What would you expect the immediate effect on home prices in the area to be? - CORRECT ANSWER Home prices should rise initially. What acronym can you use to remember the broad forces that can impact the real estate market?

• CORRECT ANSWER PEGS Which situation would NOT likely result in a seller's market? - CORRECT ANSWER migration out of an area Who sets the interest rates that banks charge for mortgages? - CORRECT ANSWER individual banks and other lenders

Brian attends his real estate company's party and, after having a few too many cocktails, drives home. He is pulled over and arrested for driving under the influence. Two months later Brian is convicted and serves a year of probation and pays a fine. Brian does not notify the regulatory agency of this conviction. Which best describes this situation? - CORRECT ANSWER Brian may be punished for not disclosing the conviction Failing to notify a regulatory agency of the conviction is a violation. A rental property has a return rate of 8%. The monthly net rental is $600. What is the market value of the property? - CORRECT ANSWER $90, Rate of return is computed by dividing the annual net income by the rate of return. In this case, multiply the monthly $600 income by 12 to get the annual income. The gross annual income, $7,200, divided by 8%, is $90,000. In most states, the listing broker has a fiduciary duty to the - CORRECT ANSWER client A broker has a fiduciary duty to the client, while the broker's salespeople have a duty to the broker. While determining the net operating income of an investment property, an appraiser will not take into account - CORRECT ANSWER interest expense Although tax deductible, the amount of interest an owner pays is not used to calculate the net operating income. Remember, anything related to debt service is an owner's expense. After listing a property that the agent believes is overpriced, the agent returns to the office and vents his frustration to a fellow licensee at the brokerage. Which duty has the agent breached? - CORRECT ANSWER loyalty If an agent decides to take the listing at the price indicated by the seller, the agent must be loyal to the seller and not imply that the list price is unreasonable.

The property sale will close on April 15, 2010. Taxes are $4,300 per year and are paid through December 2009. Calculate the seller's share of taxes using a calendar year (365 days). - CORRECT ANSWER $1,236. There isn't really a formula for calculating prorations. First, calculate a cost per day, then determine the number of days in which taxes haven't been paid, and then multiply the number of days by the daily tax rate. Substitute numbers for the known factors in the formula. Step 1: Determine the Daily Tax Rate: $4,300 / 365 = $11.7808; Step 2: Determine the Number of Days: January 31 + February 28 + March 31 + April 15 = 105; Step 3: Determine Amount Owed: 105 days x $11.7808 per day = $1,236.984. The seller owes $1,236.98 in taxes. Which of the following statements is true regarding real estate trust accounts in Georgia? - CORRECT ANSWER A broker may have multiple trust accounts as long as each is registered with the Real Estate Commission Interest-bearing trust accounts are permitted as long as the contract states that the designated trust money will be held in an interest-bearing account as well as to whom the interest will be paid. Trust money must be held in a separate FDIC insured "trust account." A broker is not limited to the number of trust accounts he or she may open as long as each account number and bank account name is provided to the Commission. The real estate closing date is May 25. The lender uses a 360-day calendar for interest proration and payments are due on the 15th day of each month. The loan balance is $84,000 with an interest rate of 8%. How much accrued interest will the seller owe at closing? - CORRECT ANSWER $186. The 360-day calendar assumes every month has 30 days. $84,000 x 8% = $6,720 for the total interest by year. $6,720 divided by 12 = $560 for the interest per month. $560 divided by 30 days = 18.6666 for the interest per day. 10 x 18.6666 = 186.67 for the interest for 10 days. All of the following are true about a CAM license in Georgia EXCEPT: - CORRECT ANSWER It allows the licensee to manage residential and condominium communities as well as provide real estate services to homebuyers and sellers

The holder of a CAM license must satisfy license law education and exam requirements. The license only permits the holder to engage in community management activities. The license may be acquired without holding a salesperson's license but a salesperson or broker might additionally acquire the CAM license. Which of the following property legal descriptions is NOT used in Georgia? - CORRECT ANSWER Rectangular survey system The metes and bounds system and lot, block system are the only two legal descriptions for property used in Georgia. The Real Estate Settlement Procedures Act (RESPA) is administered by the - CORRECT ANSWER Department of Housing and Urban Development HUD administers RESPA rules and compliance. The Division of Real Estate regulates real estate professionals. ALTA regulates title companies. NAR promulgates a code of ethics. Which of the following statements is true concerning Georgia's Real Estate Commissioner? - CORRECT ANSWER The Commissioner is hired by the Real Estate Commission If the Commissioner or any of the Commissioner's staff holds a real estate license, it must be placed on inactive status. The Commissioner is not a member of the Real Estate Commission, but is hired by the Commission. A property generated $135,000 income per year. A vacancy and collection loss of 5% is normal for the area. The building expenses are $8500. What was the gross income? - CORRECT ANSWER $135, Gross income is the total amount a property generates in income before expenses are removed. The agreement of sale should provide that if the property is damaged or destroyed by fire before the deal is consummated, the loss will fall upon the - CORRECT ANSWER the seller

The "risk of loss" is transferred to the buyer upon the signing of the sales contract. Thus, the sales contract should include a clause that would keep the risk of loss on the seller and require the seller to maintain insurance. If this clause were not inserted in the sales contract, then the buyer would be responsible for any damage to the property and still have to buy the property, regardless of condition. A lead-based paint disclosure form is required for all residential dwellings built before January 1,

1978. When applicable, who must sign the form? - CORRECT ANSWER buyer, seller, and both agents All parties must sign the disclosure form. Both agents are equally liable for compliance. A legal property description in Georgia that identifies boundaries and is commonly used to survey property is known as: - CORRECT ANSWER System of metes and bounds The principal method of delineating property boundaries for surveys and creating a legal description for property in Georgia is called the metes and bounds system. The short form, also known as lot, block system, is the other acceptable legal description for property in Georgia. What is an involuntary specific lien? - CORRECT ANSWER mechanic's lien The IRS lien is a general involuntary lien against all items owned by an individual (including, but not limited to, real estate). The mechanic's lien is an involuntary specific lien against property worked on by a contractor. The mortgage is a voluntary specific lien given freely by the landowner to the buyer. The easement is not a lien, although it is an encumbrance on the property. Which statement is TRUE? - CORRECT ANSWER You receive stock in a cooperative and a deed in a condominium Condominium owners receive a deed and cooperative owners buy stock and receive a proprietary lease.

What is the gross commission on a property that sold for $450,000 with a rate of commission of 6%? - CORRECT ANSWER $27, $450,000 x .06 = $27, Which would be an example of voluntary alienation? - CORRECT ANSWER sale Eminent domain is the government's right to take private property with just compensation and is an involuntary transfer of title. Escheat is when one dies without a will and without heirs, so title involuntarily transfers to the state. Adverse possession is acquiring someone else's title through open notorious, exclusive, and continuous use of the property (also involuntary). The sale of property is usually a voluntary event. At a listing appointment, Patty promises the sellers they will get four open houses a month. The seller signs the agreement. In the first month of marketing, Patty's husband becomes ill and Patty cancels the open house. The seller got only two open houses that month. Which best describes the situation? - CORRECT ANSWER Patty is breaching her broker's duty of accountability Agents are accountable to the client for their actions. If the seller was promised four open houses a month, that is what the seller should get. Regarding the handling of earnest money in a Georgia real estate contract, which of the following is true? - CORRECT ANSWER The amount of earnest money and who will hold these funds is determined by contract agreement Items other than legal tender (money) may suffice as earnest money as long as the item is identified and assigned a monetary value in writing. Earnest money may be held by whomever is contractually agreed upon, including either the listing broker or the selling broker. If earnest money is deposited in an interest-bearing trust account, then all parties to the contract must agree in writing as to who receives the interest earned. What purpose does the Superfund serve? - CORRECT ANSWER It allows the EPA to clean up abandoned waste sites and requires the responsible party to cover the costs of doing so

The Clean Water Act deals with water quality. The Clean Air Act prevents air pollution. The Lead-Based Paint Hazard Reduction Act prevents lead poisoning. The Superfund allows the EPA to clean up such sites and compels responsible parties to perform clean ups or reimburse the government for EPA clean ups. A broker has a policy that agents will not be dual agents in in-company transactions or when the agents sell their own listings. Which would a potential buyer be to the listing agent if the buyer wants to buy the agent's listing? - CORRECT ANSWER customer A dual agent is a broker or salesperson who represents both buyer and seller. A client is a party represented by a broker. An agent is someone a client hires to represent them like a broker. The customer is the party in the transaction that is not represented. Seller and buyer entered into an instrument of conveyance in which the buyer immediately received legal title. Which instrument would have been used by the parties? - CORRECT ANSWER deed An offer cannot become a contract until the offer is accepted. An option may never be exercised. A land contract only conveys equitable title. A deed is the instrument that conveys legal title. An attorney refers a friend looking to purchase a home to a broker. Subsequently, the broker contacts the attorney's friend and assists in finding a property for the friend to buy. At what point might the broker be allowed to compensate the attorney for the referral? - CORRECT ANSWER At no time License law in Georgia allows a broker to pay a referral fee ONLY to another real estate broker. A real estate listing is an agreement between - CORRECT ANSWER seller and broker The listing agreement is an agreement between broker and seller; the broker is entitled to a commission when a ready, willing, and able buyer makes an offer acceptable to the seller.

Executor Fred calls Agent Tom to list a vacant tract of land, instructing him to list the land for $700,000. Several weeks later, Agent Tom becomes aware of a developer who would pay as much as $1,000,000 for the property. Tom thereupon submits a full-price offer to the owner and purchases the property. Tom then resells the property to the developer and pockets a $300, profit. Which statement is TRUE? - CORRECT ANSWER Tom violated the law by not providing notice of information that would affect Fred Tom had a duty to inform Fred of the true value of the property. This would be known as self- dealing. Point of beginning refers to - CORRECT ANSWER the first corner of the parcel to be surveyed. The point of beginning is where a metes and bound description starts and ends. An individual has operated a service station in Georgia for years, in an area recently rezoned for residential use. After the gas station was virtually demolished by a severe storm, what would be true? - CORRECT ANSWER The owner could only rebuild the gas station if the location was spot zoned for commercial use or if the owner was granted a variance Under these circumstances, the owner had been operating the service station under non- conforming use; when the property was destroyed, it would have to be rebuilt to comply with current zoning laws, unless the location was spot zoned for commercial or the owner was granted a variance from the zoning board. The owner would not be entitled to compensation for the loss of the business. Who is NOT an agent or subagent? - CORRECT ANSWER a non-licensed personal assistant of an agent A broker, property manager, and salesperson would either be considered an agent, or subagent. An unlicensed assistant can only do administrative tasks for the agent. With the intention of offering a homebuyer some assurances about the physical condition of the property under contract, the customary residential sales agreement form in Georgia makes the

buyer's contract commitment contingent on a(n): - CORRECT ANSWER Inspection by a qualified home inspector Although many contingencies may be a part of any real estate sales contract, the standard Georgia real estate contract includes a home inspection contingency that specifically affords the buyer some degree of confidence regarding the structural condition of the property. A section of a township contains - CORRECT ANSWER 640 Acres An acre contains 43,560 square feet, which is equal to 160 square rods. A mile contains 5, feet, which is equal to 1,760 yards, or 320 rods. Each township contains 36 sections. Each section is one square mile, or 640 acres. Taking measures to reduce adverse impacts on the environment is known as - CORRECT ANSWER mitigation Minimization is a comprehensive program to minimize or eliminate wastes. Mitigation is the measures taken to reduce adverse impacts on the environment. Microbial growth is the amplification or multiplication of micro-organisms. A mobile incinerator system is the hazardous waste incinerator that can be transported from one site to another. After a mortgage foreclosure sale in Georgia, how long does the defaulted borrower have to redeem the property? - CORRECT ANSWER There is no redemption period in Georgia after the foreclosure sale In Georgia, the period for redeeming a property in default, called equity of redemption, does not extend beyond the foreclosure sale, which, if allowed, is called statutory equity of redemption. Bob and Janice want to obtain a loan to buy a new home. Their combined monthly income is $7,500. What amount of monthly payment can they qualify for if the lender uses 28/36 ratios and they have no other debt? - CORRECT ANSWER $

To calculate the maximum monthly payment they can qualify for, use the qualifying formula: Part (Allowable payment amount) = Percent (Ratio) x Whole (Income). Insert the known variables, Part = 0.28 x $7,500 and calculate. The maximum monthly payment Bob and Janice can qualify for is $2,100. A real estate agent forms an LLC. While previewing the new listings on the market the agent sees a bank-owned listing priced to sell quickly. The agent writes an offer on the property in the name of the LLC. The bank addendum prohibits agents from purchasing bank-owned assets. The agent's LLC buys the property. The agent - CORRECT ANSWER is acting as an undisclosed principle If the purchaser (the LLC) is owned by the agent, the agent must disclose themselves as the principle. The agent would have been prohibited under the bank addendum from buying the property. When does BRRETA require that agency disclosure be made? - CORRECT ANSWER When entering into a brokerage engagement Georgia agency law requires that agency disclosure be made when first entering into a brokerage engagement. Georgia lender may consider all of the following factors in qualifying an applicant for a home loan EXCEPT: - CORRECT ANSWER If the applicant had a source from which the down payment might be borrowed Typically, the amount of down payment will have to be verified from the applicant's own financial resources. Credit history and income to debt ratio would all factor into the lender's decision to approve a loan. What document is evidence of the relationship between property owner and property manager? - CORRECT ANSWER Property management agreement A listing agreement is between seller and broker. A buyer broker contract is between buyer and broker. A lease is between landlord and tenant.

For a purchaser who is buying a home in Georgia with an LTV of 90%, escrow establishment charges for prepaid property taxes might be estimated by a lender as an amount equal to: - CORRECT ANSWER The number of months reflected in the tax escrow chart determined by the estimated date of the first monthly payment for the loan The tax escrow chart in Georgia for determining how many months of property taxes a lender can require a borrower to prepay at closing is based on when the borrower's first monthly payment will be due. A mechanics lien is of: - CORRECT ANSWER of indeterminable duration Mechanics liens are specific liens with an indeterminable duration. An assessor's parcel number is - CORRECT ANSWER reference number for county tax records. Tax Assessor Parcel Number refers to the county appraisal. Interest rate usury laws in Georgia offer what guidelines regarding 1st mortgage home loans for real estate? - CORRECT ANSWER There are no usury laws regarding 1st mortgage home loan interest rates in Georgia Exp:1st Mortgage loans in Georgia no longer have a usury ceiling for interest rates. A community association manager in Georgia might be involved with all of the following communities EXCEPT: - CORRECT ANSWER 200 apartment/home community A community association manager in Georgia could work for various types of homeowners associations, including town homes, cluster homes, and cooperatives. Managing apartments, though, would be the job of a property manager who works for the property owner; a community association manager, in effect, works for all of the homeowners in the community.

Building codes can be enforced by - CORRECT ANSWER the issuance of permits Building codes set construction standards; building plans must comply with the code for a permit to be issued. Failure to comply with the permit may result in a stop order, fines, and/or injunctions. Zoning laws set forth permitted uses. Licenses allow certain activities. Letters of approval are not a method of enforcement. An unlicensed property manager can do all of the following except: - CORRECT ANSWER Negotiating lease terms Most states require anyone who lists, sells, leases, exchanges or otherwise negotiates in the real estate of others must be licensed. What is the body of law that governs negotiable instruments? - CORRECT ANSWER Uniform Commercial Code The Uniform Commercial Code sets out certain requirements for negotiable instruments in order to be transferrable to the secondary market, for example. If the sales price of a home in Georgia is $185,000 and the buyer is getting a new loan to finance the home purchase, what amount would show as the transfer tax on the settlement statement at closing? - CORRECT ANSWER $185 $185,000 divided by 100 = $1,850 x 0.10 = $185; new loan is irrelevant as transfer tax is based on sales price. For the income approach to appraisal, value is a reference to the - CORRECT ANSWER worth of the investment The income approach involves one of two possible methods of calculation: 1. the capitalization using income divided by rate equals value, or 2. value divided by income equals gross rent multiplier.

The listing agent discriminates against a minority buyer. If the seller were to be held responsible for the actions of the agent, it would be an example of - CORRECT ANSWER vicarious liability Vicarious liability occurs when a client is held liable for the actions of their agent. Dual liability would be when more than one party is liable. Misrepresentation is a false or misleading statement. Fraud is an intentional or negligent misrepresentation or concealment of a material fact. A real estate agent tells a buyer that they will make a profit of 5% on their investment in as little as three months. Has the agent done anything wrong? - CORRECT ANSWER Yes, promising future value is a violation Real estate agents cannot promise future values, the agent can recite history only. A disabled tenant was denied permission to install a handlebar in the shower. What law has the landlord violated? - CORRECT ANSWER ADA Under the Americans with Disabilities Act (ADA), an owner or property manager must make reasonable accommodation for the tenant. "The subject property" best describes the property - CORRECT ANSWER for which the value is sought The appraiser does not consider properties on the market. The subject is the property for which an opinion of value is sought. A contingency is something that must be done or must occur in order to complete the terms of a contract. In the purchase and sale of a home, what is a contingency? - CORRECT ANSWER all of the answers listed Contracts often contain one or more events, conditions, or contingencies. If the event does not occur, the condition is not fulfilled, or the contingency is not satisfied, and if a good faith effort

has been made to satisfy the contingency, the promisor can withdraw without liability for breach of contract. If a closing in Georgia involving rental property takes place on October 17 and the tenant pays rent on the first day of each month, at the closing: - CORRECT ANSWER The seller will owe the buyer 14 days' rent The seller may keep the prorated rent from the 1st through and including closing day; the buyer is entitled to a prorated portion of the rent, beginning the day after closing to and including the last day of the monthly rental period. In this example, from the 18th of October until October 31, for a total of 14 days. What would cause termination of a real estate contract? - CORRECT ANSWER completion The termination of a contract occurs if it is completed (i.e., closed). Fraud makes a contract voidable by the lied to party, but it does not necessarily terminate the contract. Acceptance of an offer would commence the contract, not terminate it. Applying for financing is typically not a cause for termination of a real estate contract. A closing conducted by a disinterested third party best describes a(n) _______ closing. - CORRECT ANSWER escrow A closing conducted by a disinterested third party is an escrow closing. The roundtable closing involves all parties to the transaction signing documents at the same place at the same time. A lender is to whom one goes to get a loan. The broker is who would help the buyer find a property. Which term best describes a piece of land that is enhanced and ready for a building or structure?

• CORRECT ANSWER site A site is a piece of land that has been enhanced and is ready for a structure. Situs is an area of preference, which can attribute value. Assemblage is the joining of several parcels of land. Plottage is when the property is joined to increase value.

When entering into a listing agreement, a licensee must: - CORRECT ANSWER Give a signed copy of the listing agreement to the home seller A licensee is obligated to give a copy of all brokerage engagements to the client as soon as the agreement is signed. There are no obligations for the licensee to advertise the property, create a file for the Commission, or offer subagency to other brokers. The subject property is a three-bedroom ranch with two full baths and a two-car garage. In the same neighborhood, a nearly identical home with only one bath just sold for $102,000. The appraiser estimates the value of the second bath at $2,000. Based on just this information, what would the subject's value be? - CORRECT ANSWER $104,000 The comparable sold for $102,000 with only one bath. The subject has two baths, so it will sell for more. Adjust the comparable up by $2,000. Remember, when inferior add and when superior subtract. Ann is looking for a home with everything on one floor. Which type of house should the agent show Ann? - CORRECT ANSWER ranch Licenses are required for all of the following professions in Georgia EXCEPT: - CORRECT ANSWER Which is the environmental program established to address abandoned hazardous waste sites? - CORRECT ANSWER A broker has a fiduciary duty to - CORRECT ANSWER The statute of limitations... - CORRECT ANSWER A listing agent might help a client prepare an estimated seller net worksheet for the closing at what point? - CORRECT ANSWER