Post License Course (Barney Fletcher) 351 Questions with correct Answers, Exams of Nursing

Download Post License Course (Barney Fletcher) 351 Questions with correct Answers and more Exams Nursing in PDF only on Docsity! Post License Course (Barney Fletcher) 351 Questions with correct Answers Within the first five years around ___% of agents leave the real estate business - 80-90% For buyers what are the five steps of the pre-qualification process - 1. Urgency 2. Motivation 3. Financial Ability 4. Wants and Needs 5. Agency For sellers what are the five steps to the first appointment - 1. Urgency 2. Motivation 3. Concerns 4. Expectations 5. Hesitations A person who may be willing to engage in a real estate transaction - Prospect A person who is willing to perhaps have a conversation but has no real desire to engage in a real estate transactions - Suspect In determining whether a person is a suspect or a prospect we must consider - Urgency and motivation When setting goals, its important they be - Specific Measurable Attainable Realistic Timely Most common type of target market is a particular neighborhood of homes - Farming A ______ analysis can be helpful in analyzing your strengths and weaknesses, which can sometimes help you pick the target market that is best for you - SWOT The primary objective of any type of real estate prospecting is to - Generate an appointment The ratio that is computed by dividing the number of homes sold in a year by the total number of homes in the farms - Turnover ratio A method of prospecting that will involve the telephone, but only as part of a mix of different types of contacts - Circle prospecting A ______ agent has more control than a _____ agent - Listing/selling This involves only one appointment with the prospective sellers. Licensee makes the presentation, show the recommended price through CMA and try to get sellers to sign the listing contract - 1-step listing presentation What is the best way to establish a personal brand in real estate - To develop a good reputation Which of the following choices is the most common way buyers find a house they purchased - Internet What is the most important part of your "brand" in your real estate career - Your reputation When a real estate licensee focuses his or her prospecting efforts on a particular neighborhood or type of buyer is the licensee's - Target market As a real estate agent your primary product is - Your contacts When the number of listings by a particular firm is divided by the total number of listings in that neighborhood, the result is the - Market share Which of the following is the best way to ask for a referral - Who do you know who might be looking to buy or sell a house The process of ensuring that the interior and exterior of a home are as attractive as possible is known as - Staging The types of media used to generate new business is known as the - Promotional mix When doing the initial tour of a house before making a listing presentation, one goal should be to - a position of trust and must put the interest of his client (Steve) above those of all others, including and especially those of himself. - fiduciary obligations This means that the agent is required to act in the best interest of the client and must not put anyone else's interests ahead of those of the client. - loyalty Agents are only required to follow the ________instructions of their client. - lawful In simple terms, this means that the licensee must perform the duties of the agent as would a competent real estate professional and without any negligence. - reasonable care and diligence If you are showing property you are listing and tell a prospective buyer that "...this property is the best for you," the relationship created could be interpreted as: - implied agency Under common law, a broker who has a listing is in a position of trust and must put his or her interests above those of all others. This describes what type of obligation? - fiduciary What is the greatest risk in a case where a buyer's agent submits offers on several homes simultaneously? - . The buyer could be contractually obligated to buy more than one house and could face damages if defaulting on any of the contracts. The duty of an agent to follow the instructions of the client applies to each of the following instructions, EXCEPT: - . "Do not reveal to any buyers that my roof leaks." The state law that specifies which types of contracts must be in writing to be enforceable is called the: - Statute of Frauds. What offers must a listing broker present to a seller? - All offers received prior to closing. Which of the following actions by a licensee who is working with a consumer as a non-client could cause the creation of an agency by implication? a. Filling in the blanks on a pre-printed offer to purchase real property. b. Showing homes to a consumer which meet the consumer's specified needs and desires. c. Making arrangements for a home inspection to take place. d. Making a recommendation about whether to make or accept a counteroffer. - Making a recommendation about whether to make or accept a counteroffer. A seller contacted 3 brokers and asked each to suggest the listing price for his property. Broker A said $78,000. Broker B said $79,000. Broker C said $91,000. The seller listed with Broker C and the house later sold for $76,000. Broker C is guilty of violating which of his or her agency responsibilities? - reasonable care Broker Bob has a buyer agency agreement with Buyer Bill. The agreement calls for Buyer Bill to pay a 3% commission upon closing of the purchase of a home. Buyer Bill purchases Seller Sally's house. Seller Sally gave an exclusive right to sell listing agreement to Broker Betty and agreed to pay a 6% commission. In a typical transaction of this nature, how much commission will Buyer Bill have to pay to Broker Bob? - nothing A real estate licensee represents himself to a customer as the agent of a seller without the knowledge of the seller. The customer makes an offer on the property, which the licensee then presents to the seller. The seller accepts the offer and agrees to pay a commission to the licensee. This is an example of: - agency by ratification What is the purpose or effect of the equal dignities rule? - To require that if the underlying contract must be in writing, any related contracts must be in writing. Which of the following clauses in an offer to purchase a property would be most attractive to a buyer who makes several simultaneous offers to purchase a residence when the buyer can only purchase one of them? - . An unrestricted right to terminate the contract for a limited period of time. REALTORS® may represent the seller/landlord and buyer/tenant in the same transaction only after - full disclosure to and with informed consent of both parties. When acting as listing brokers, REALTORS® shall continue to submit to the seller/landlord all offers and counter-offers until - closing or execution of a lease unless the seller/landlord has waived this obligation in writing. When entering into listing contracts, REALTORS® must advise sellers/landlords of: - 1) the REALTOR®'s company policies regarding cooperation and the amount(s) of any compensation that will be offered to subagents, buyer/tenant agents, and/or brokers acting in legally recognized non-agency capacities; 2) the fact that buyer/tenant agents or brokers, even if compensated by listing brokers, or by sellers/landlords may represent the interests of buyers/tenants; and 3) any potential for listing brokers to act as disclosed dual agents, e.g., buyer/tenant agents. (Adopted 1/93, Renumbered 1/98, Amended 1/03) REALTOR® A has a listing on a seller's home and the seller has accepted an offer. The offer is contingent upon the sale of the buyer's current home. REALTOR® B has a buyer who has made an offer. Under the Code of Ethics, what should listing REALTOR® A do? a. Ignore REALTOR® B's offer since the seller's home is already under contract. b. Reveal the existence of the contract but not the contingency. c. Reveal the existence of the contract and the contingency. d. Present the second offer to the seller without disclosing the existence of the offer or the contingency. Feedback - c. Reveal the existence of the contract and the contingency. A REALTOR® has a listing on a client's house. The sellers are getting a divorce and need to sell the home quickly. Under what circumstances can the REALTOR® reveal this fact to a potential buyer? - d. Only after getting informed consent from the seller. Act was designed to ensure that persons of any race could sign and enforce contracts and could buy and sell and lease property. - Civil Rights act of 1866 The Sherman Antitrust Act prohibits each of the following activities, EXCEPT: Select one: a. Commingling. b. Price fixing. c. Boycotts. d. Tying arrangements - a. commingling A listing agreement may be terminated by: Select one: a. The seller b. The buyer's broker c. The salesperson that obtained the listing d. Death of the salesperson - a. the seller Brokers must hold their client's funds in a/an: Select one: a. Office safe. b. Savings account. c. Trust or escrow account. d. Special account managed by the Board of Realtors. - c. trust or escrow account A broker has the buyer's earnest money deposit deposited in an escrow account. The amount of the deposit exceeds the amount of the broker's commission for the sale. The broker may remove his commission on this sale ONLY: Select one: a. When the buyer moves into the property. b. When the seller moves out of the property. c. When the closing is completed. b. Failure to prevent squatters from taking over the property; c. REOs located in African-American and Latino neighborhoods receive less upkeep and maintenance than those in Caucasian neighborhoods; d. It is too difficult to sell REO properties in minority neighborhoods. - c. REOs located in African-American and Latino neighborhoods receive less upkeep and maintenance than those in Caucasian neighborhoods; Which of the following phrases in a rental advertisement would be deemed discriminatory against the disabled? Select one: a. Attractive independent living; b. Walking distance to shopping; c. Accessible for the disabled; d. None of the above. Feedback - a. Attractive independent living; An apartment complex has a "no pets" policy. Mary is a blind person who applies to rent a unit, but she wants to have her certified guide dog live in the apartment with her. This request: Select one: a. Can only be granted if the landlord agrees to remove "no pets" policy; b. Should be considered "reasonable accommodation;" c. Should be considered a "reasonable modification;" d. Cannot be granted. - b. Should be considered "reasonable accommodation;" In 1968 the Supreme court ruled in the Jones vs. Mayer Co. case. The courts' decision upheld the law which provides protection on the basis of: Select one: a. Sexual discrimination; b. Racial discrimination; c. Discrimination on the basis of national origin d. Religious discrimination - b. Racial discrimination; Which of the following choices would be an example of a member of the "familial status" protected class under the Fair Housing Amendments Act? Select one: a. Any married couple; b. A single mother with a 19-year old child; c. A married couple with two grown children; d. A pregnant woman. - d. A pregnant woman. In what circumstance is the owner required to pay any costs associated with a reasonable accommodation? Select one: a. In no cases; b. In all cases; c. Only if the owner receives operating subsidies from the government, such as Section 8 vouchers; d. Only if the property was built after 1991. - b. In all cases; The 1988 Amendment to the Federal Fair Housing Act, Title VIII, declared it unlawful to discriminate: Select one: a. Against households with children under 18 years of age; b. On the basis of age; c. Because of sexual orientation; d. On the basis of the sex of the buyer or renter - Against households with children under 18 years of age; Which of the following documents may include a question about the applicant's race? Select one: a. A mortgage application only; b. A rental application only; c. Both a mortgage application and a rental application; d. Neither a mortgage application nor a rental application. - a. A mortgage application only; If a prospective buyer (who is of a minority group) asks an agent to show her properties, the agent should: Select one: a. Show her properties in areas that are predominantly of the same minority group; b. Refer her to an agent in the firm of the same minority; c. Advise her that the firm does not handle people of her minority group and refer her to another brokerage d. Show her any property for which she is financially qualified - d. Show her any property for which she is financially qualified A victim of discriminatory conduct files a lawsuit and wins the case. Part of the judgment in the case is for emotional distress and loss of a housing opportunity. This part of the judgment is called: Select one: a. Consequential damages; b. Punitive damages; c. Injunctive relief; d. Declaratory relief. - a. Consequential damages; When HUD sends a complaint to a respondent, that respondent has how many days to submit an answer to the complaint? Select one: a. 5 days; b. 10 days; c. 15 days; d. 30 days; - b. 10 days; If a dark-skinned African-American refused to rent an apartment house to a lighter- skinned African-American, that would be considered: Select one: a. Discrimination on the basis of race only; b. Discrimination on the basis of color only; c. Discrimination on the basis of both race and color; d. Not to be a violation of the Fair Housing Act. - b. Discrimination on the basis of color only; Each of the following would be considered a "person with a disability," EXCEPT: Select one: a. An individual who currently uses illegal drugs; b. A person with a past history of mental impairment; c. A person with a learning disability; d. A person who has difficulty walking. - a. An individual who currently uses illegal drugs; If a landlord or property manager treats Caucasian tenants better than Latino tenants, that would be an example of: Select one: a. Overt evidence of disparate treatment; b. Comparative evidence of disparate treatment; c. Evidence of disparate impact; d. Both A and B above. Feedback - b. Comparative evidence of disparate treatment; A fair housing complaint on the basis of excluding those with a record of criminal conviction may be based on allegations of: Select one: a. Disparate impact; b. Disparate treatment; c. Either of the above; d. None of the above. - Either of the above; Information gathered because of the Home Mortgage Disclosure Act would most likely be used for which type of discrimination lawsuit? Select one: a. Overt evidence of disparate treatment; b. Comparative evidence of the disparate treatment; c. Either of the above; d. Evidence of disparate impact. - d. Evidence of disparate impact. If the Administrative Law Judge finds that a landlord had violated the Fair Housing Act in the current case, and has been found guilty of two other violations in the past seven years in other cases, the respondent could be ordered to pay a maximum fine of approximately: c. When the tenant requests one and the request does not place an undue burden on the owner; d. At no time, since reasonable accommodations are always voluntary. Feedback - When the tenant requests one and the request does not place an undue burden on the owner; A disparate impact case has gone to trial. The plaintiffs have shown that a particular policy has had a disparate impact on a particular protected class. However, the defendant has shown that the policy serves a legitimate business necessity. What will be the next step? Select one: a. The case will be dismissed. b. The plaintiff will have to show that the policy involved a discriminatory intent on the part of the defendant; c. The plaintiff will have to show that other policies might have served the same business necessity with less disparate impact on protected classes; d. The defendant will have to prove that there was no discriminatory intent when it set the policy. - The plaintiff will have to show that other policies might have served the same business necessity with less disparate impact on protected classes; Claims filed with HUD for alleged Fair Housing violations must be filed within: Select one: a. 90 days; b. 180 days; c. 1 year; d. 2 years. - c. 1 year; Which of the following documents may include a question about the applicant's race? Select one: a. A mortgage application only; b. A rental application only; c. Both a mortgage application and a rental application; d. Neither a mortgage application nor a rental application. - a. A mortgage application only; A property owner creates the following policy: There shall be no "loud and boisterous activity on the premises, music played loud and/or with too much bass, a continuous or excessive number of guests, noisy children, or vehicles with very loud exhaust system." Is this policy likely to be found to be enforceable? Select one: a. No, primarily because of the reference to noisy children; b. Yes, it is reasonable and serves a legitimate business necessity; c. No, primarily because of the reference to loud music; d. No, primarily because of the reference to automobiles. Feedback - a. No, primarily because of the reference to noisy children; Sally owned a rental home which she has never occupied. Under the federal Fair Housing Act, under what circumstance might she be able to sell this rental property and be exempt from the Fair Housing Act? Select one: a. As long as she uses the services of a real estate licensee; b. As long as she discloses the exemption from the Fair Housing Act in any advertisement; c. Under no circumstances; d. As long as she does not sell more than one such property in any two-year period. - As long as she does not sell more than one such property in any two-year period. A victim of discriminatory conduct files a lawsuit and wins the case. Part of the judgment in the case is for emotional distress and loss of a housing opportunity. This part of the judgment is called: Select one: a. Consequential damages; b. Punitive damages; c. Injunctive relief; d. Declaratory relief. Feedback - a. Consequential damages; In past years, fair housing complaints involving insurance companies typically involved complaints regarding: Select one: a. Steering; b. Redlining; c. Blockbusting; d. Discriminatory pricing. - b. Redlining; A real estate licensee who works only with buyers has told a Latino buyer that the local school district is very good but offers no English as a Second Language program. The same licensee tells Caucasian buyers that the local school district is great. This licensee has: Select one: a. Done nothing wrong; b. Engaged in steering; c. Engaged in redlining; d. Engaged in blockbusting. - b. Engaged in steering; A couple has rented a one-bedroom apartment. After a new baby arrived, the landlord filed an eviction notice on the couple because the landlord's policy is that the occupancy limit is two people per bedroom. Which of the following statements is the most likely result of a fair housing lawsuit filed by the tenants? Select one: a. The eviction would likely be upheld due to the HUD Keating Memo which suggests occupancy limits of 2 persons per bedroom. b. The eviction would likely be overturned because of the age of the child. c. The eviction would likely be upheld if the occupancy limit was clearly disclosed in the rental agreement or lease. d. The eviction would be overturned as it is unconstitutional. - b. The eviction would likely be overturned because of the age of the child. Which of the following statements is/are true regarding the addition of sexual orientation and the gender identity as members of a protected class? Select one: a. It is based on a Supreme Court decision and a Presidential Executive Order; b. It is based on the protected class of sex; c. Both of the above; d. None of the above. - c. Both of the above; The burden of proof falls on the plaintiff in which of the following aspects of a disparate impact case? I. Proving that the policy has a disparate impact; II. Proving that the policy serves a business necessity. III. Proving that an alternative policy could achieve the business necessity without a disparate impact Select one: a. I only; b. I & II; c. I & III; d. II & III. - c. I & III; A young couple comes into a Georgia real estate brokerage office and tells an agent that they are looking for a home in a particular price range. Both spouses are 25 years old. The agent who greeted them at the door tells them that the firm normally doesn't work with people of their age group, but in this case the agent will make an exception. This scenario is an example of: Select one: a. Overt evidence of disparate treatment; b. Comparative evidence of disparate treatment; c. Evidence of disparate impact; d. Both A and B above. - Overt evidence of disparate treatment; Which of the following protected classes were added in the Fair Housing Amendments Act of 1988? Select one: a. Disability; b. Familial status; c. Both of the above; d. None of the above. - c. Both of the above; Larry Licensee runs an ad for one of his listings. The ad contains the phrase "nearby St. Andrew Roman Catholic Church." This would be considered: Select one: The 1988 Amendment to the Federal Fair Housing Act, Title VIII, declared it unlawful to discriminate: Select one: a. Against households with children under 18 years of age; b. On the basis of age; c. Because of sexual orientation; d. On the basis of the sex of the buyer or renter - a. Against households with children under 18 years of age; According to the State Building Code Occupancy Standards, if a couple had triplets, the minimum square footage of a bedroom for the triplets would be: Select one: a. 70 square feet; b. 120 square feet; c. 150 square feet; d. 210 square feet. - c. 150 square feet; The Fair Housing Act is part of what larger law? Select one: a. The Civil Rights Act of 1964; b. The Civil Rights Act of 1866; c. The Civil Rights Act of 1968; d. The Civil Rights Act of 1974. - c. The Civil Rights Act of 1968; An apartment complex owner has a rule regarding the use of the pool which states "Children must leave the pool by 6:30 pm and must be supervised by a resident relative at all times when using the pool." Which of the following statements is correct about whether this policy would constitute discrimination on the basis of familial status? Select one: a. Since safety is a valid concern, this policy would be permissible. b. This policy would be a violation, solely because of the requirement that the supervising adult must be a relative; c. This policy would be a violation, solely because of the time restriction; d. This policy would be a violation because of both the time restriction and the requirement that the supervising adult must be a relative. Feedback - his policy would be a violation because of both the time restriction and the requirement that the supervising adult must be a relative. The law that states that it is illegal to refuse to sign a contract because the other party is not a Caucasian is: Select one: a. The Civil Rights Act of 1866; b. The Fair Housing Act; c. The Fair Housing Amendments Act of 1988; d. The Gramm-Leach-Bliley Act. - a. The Civil Rights Act of 1866; Which of the following property owners would be exempt from the prohibition against discrimination in the Civil Rights Act of 1866? Select one: a. The owner of a single-family residence who owns 3 or less such residences and does not use a licensed real estate agent; b. A religious organization that gives housing preferences to its members; c. Both of these choices; d. None of these choices. - d. None of these choices. What is the recommended practice for a licensee to follow when asked about the local school districts? Select one: a. Act as a resource rather than an advisor; b. Give an honest opinion about each school district; c. Give no information about school districts; d. Recommend the best school district in the area. - a. Act as a resource rather than an advisor; In today's economy, what is the most common type of discrimination complaint filed against municipalities? Select one: a. Restrictive zoning that attempts to exclude African-American people from moving into the city; b. Unreasonable building codes; c. Unreasonable occupancy limits; d. Restrictions against group homes for the disabled in residential neighborhoods. - Restrictions against group homes for the disabled in residential neighborhoods. Sally owned a rental home which she has never occupied. Under the federal Fair Housing Act, under what circumstance might she be able to sell this rental property and be exempt from the Fair Housing Act? Select one: a. As long as she uses the services of a real estate licensee; b. As long as she discloses the exemption from the Fair Housing Act in any advertisement; c. Under no circumstances; d. As long as she does not sell more than one such property in any two-year period. - d. As long as she does not sell more than one such property in any two-year period. What determines whether a person is a member of the familial status protected class? Select one: a. Whether a couple is married; b. Whether a person has (or will soon have) custody of a child under the age of 18; c. Whether the household includes at least three people; d. All of the above. - b. Whether a person has (or will soon have) custody of a child under the age of 18; In what circumstance is the owner required to pay any costs associated with a reasonable accommodation? Select one: a. In no cases; b. In all cases; c. Only if the owner receives operating subsidies from the government, such as Section 8 vouchers; d. Only if the property was built after 1991. - b. In all cases; Which of the following statements is/are true regarding the addition of sexual orientation and the gender identity as members of a protected class? Select one: a. It is based on a Supreme Court decision and a Presidential Executive Order; b. It is based on the protected class of sex; c. Both of the above; d. None of the above. - c. Both of the above; A fair housing complaint on the basis of excluding those with a record of criminal conviction may be based on allegations of: Select one: a. Disparate impact; b. Disparate treatment; c. Either of the above; d. None of the above. - c. Either of the above; A lawsuit has been filed alleging discrimination in housing against a person based on a disability. The defendant has argued that the plaintiff is not disabled under the definition of a disability in the Fair Housing Act. The court considered this argument and issued an order stating that the individual is indeed disabled under the definition of a disability in the Act. This court order is an example of: Select one: a. Injunctive relief; b. Punitive relief; c. Consequential relief; d. Declaratory relief. - d. Declaratory relief. Which of the following choices would be an example of a member of the "familial status" protected class under the Fair Housing Amendments Act? Select one: a. Any married couple; b. A single mother with a 19-year old child; c. A married couple with two grown children; d. A pregnant woman. - d. A pregnant woman. Which statement is FALSE regarding duress? Duress: Select one: a. Can take any number of forms; b. May force a person to do something against his or her will; c. Duress is caused by a party who benefits under the contract; d. Covers situations of forcing someone's assent by legal means - d. Covers situations of forcing someone's assent by legal means Which of the following statements is the most accurate statement regarding the difference between ethical standards and legal standards: Select one: a. Ethical standards guide us on what we should (or should not) do; b. Legal standards guide us on what we should (or should not) do; c. There is no relationship between legal standards and ethical standards; d. Legal standards and ethical standards are the same. - a. Ethical standards guide us on what we should (or should not) do; Each of the following items on a loan application is a possible red flag for mortgage fraud, EXCEPT: Select one: a. The employer's address is a PO Box; b. The accumulation of assets seems excessive in relation to income; c. Same telephone number for the borrower and the employer; d. A family with small children is purchasing a larger house. - A young family purchasing a larger house would not be a red flag. If the house being purchased seems to small for the number of occupants, that might be a red flag. The correct answer is: A family with small children is purchasing a larger house. Which of the following rules is NOT used by consumers to reduce the chances of identity fraud? Select one: a. Know what is in the credit file; b. Monitor credit file so notification occurs when credit inquiry made; c. Sign all new credit cards upon receipt; d. Shredding is not needed for records of account details. - The false statement is that shredding is not needed. The correct answer is: Shredding is not needed for records of account details. Which statement best describes duress? Select one: a. Duress is when a person is asked to do something willingly; b. If duress was caused by party gaining from contract, court will not recognize it; c. Duress covers situations that involve forcing someone's assent by illegal threats; d. Duress includes falsifying a required document. - c. Duress covers situations that involve forcing someone's assent by illegal threats; If a property has been sold multiple times in the past several years, what type of mortgage fraud might that indicate: Select one: a. Fraud for property; b. Equity skimming; c. Property flipping; d. Cash back on closing. - c. Property flipping; Mr. Jones owns a house worth $150,000, on which he owes $100,000. He also owes an additional $150,000 to various creditors, including credit card companies and other unsecured lines of credit. He sells the home to his daughter for $110,000 and shortly thereafter files for bankruptcy. The bankruptcy court is likely to view this sale to his daughter as: Select one: a. A prudent business move; b. A fraudulent transfer; c. An unethical, but not illegal transaction; d. None of these choices. - Since the property was sold for less than fair market value shortly before the bankruptcy filing, it will most likely be viewed as a fraudulent transfer. The fact that the sale was to a family member reinforces this likelihood. The correct answer is: A fraudulent transfer; Which of the following statements is NOT true of mortgage fraud-for-property? Select one: a. The applicant might overstate his or her income; b. The applicant often has no intention of ever repaying the loan; c. The transaction might involve a "silent second;" d. The applicant often makes significant misrepresentations on the application. - In a fraud-for-property scheme, the applicant usually fully intends to repay the loan. The applicant is lying in order to get a loan for which the applicant would not otherwise qualify. They typically intend to live in the property and intend to make the required payments. The correct answer is: The transaction might involve a "silent second;" The "ability to repay" test of the Dodd-Frank Act was designed to address: Select one: a. The foreclosure crisis; b. Abuses in the subprime mortgage market; c. High interest rates; d. Excess competition. - b. Abuses in the subprime mortgage market; Charlie is paid $10,000 to pretend to be the purchaser of a home. He fills out the loan application and attends the closing, but the property is actually owned by someone else. Charlie has acted as a: Select one: a. Straw buyer; b. Property flipper; c. Holder of a throw-away second; d. Intermediary buyer. - a. Straw buyer; The practice of purchasing a home not from any rational economic analysis but from purely speculative expectations regarding future appreciation relates to which of the following theories: Select one: a. Greater Fool Theory; b. Hot Potato Theory; c. Constant Appreciation Theory; d. Rapid Appreciation Theory; Feedback - The greater fool theory is expressed by the idea that there will always be some fool willing to pay an even higher price later. It is based on a speculative fever rather than a rational economic analysis. The correct answer is: Greater Fool Theory; The Georgia Residential Mortgage Fraud Act applies to what type of residential properties? Select one: a. Single-family residences only; b. 1-2 unit residential properties only; c. 1-3 unit residential properties only; d. 1-4 unit residential properties. - d. 1-4 unit residential properties. An individual pays someone to pose as a home buyer, using their personal information and credit score to purchase a property. The scammers then take over the title and mortgage. The mortgage lender thinks they are loaning money to the person posing as the home buyer, when in actuality, the home will be owned by someone else. This fraudulent activity involves a _____ buyer. Select one: a. Straw; b. First time; c. Subprime; d. Silent. - a. Straw; Which of the following statements best defines the practice of "steering" in originating mortgage loans: Select one: a. Refusal to originate loans in geographic areas which are predominantly populated by minority groups; b. Directing borrowers to loans which offer higher compensation to the loan originator without regard to the suitability to the borrower; c. Directing marketing efforts to poor, elderly or otherwise unsophisticated borrowers so as to take advantage of them; d. Charging excessive fees. - Steering is the practice of directing borrowers to loans which offer higher compensation to the MLO (such as subprime loans) without regard to suitability. The correct answer is: Directing borrowers to loans which offer higher compensation to the loan originator without regard to the suitability to the borrower; c. Negligence; d. Incompetence. - a. Fraud; Appraisal fraud is MOST likely to occur in: Select one: a. Property flipping; b. Cash back at closing; c. Credit repair scams; d. Pay up front scams. - a. Property flipping; Sam is a licensed MLO in Georgia and has never been disciplined for any violations of federal or state law. Sam's friend George is applying for a mortgage to finance the purchase of his first house. Sam knows that George has deliberately overstated his income. Sam takes no action and the lender discovers the overstatement. Has Sam violated the Georgia Residential Mortgage Fraud Act? Select one: a. No. b. No, because it was the borrower who overstated the inome; c. Yes, because Sam knew of the overstatement; d. Only if it can be proved that Sam knew of the overstatement - Sam has participated in mortgage fraud, which is a violation of the law. However, the Georgia Residential Mortgage Fraud Act only applies to a pattern of mortgage fraud and this is apparently his first violation, and therefore the Georgia Residential Mortgage Fraud Act does not apply. The correct answer is: No. A mortgage loan applicant claims to work for a major corporation such as General Electric. He submits paycheck stubs for purposes of documenting his income. These paycheck stubs are handwritten, not printed. Which of the following statements is most correct: Select one: a. This is a possible indication of asset misrepresentation; b. This is a strong indication of income misrepresentation; c. This is a strong indication of occupancy misrepresentation; d. Federal laws forbid the lender or MLO from drawing any conclusion from this fact. Feedback - The likelihood of a major corporation hand-writing its paycheck stubs is almost nonexistent, so this would be a strong indication of misrepresentation. It would be income misrepresentation. The correct answer is: This is a strong indication of income misrepresentation; A buyer is having trouble coming up with a down payment. The buyer borrows $40,000 from a relative one year before buying a house and uses that money for the down payment. The relative agrees to do this without any written contract. This is an example of a: Select one: a. Throw-away second; b. Silent second; c. Distributed second; d. Mortgage flip. Feedback - b. Silent second; Which of the following statements is NOT true of mortgage fraud-for-property? Select one: a. The applicant might overstate his or her income; b. The applicant often has no intention of ever repaying the loan; c. The transaction might involve a "silent second;" d. The applicant often makes significant misrepresentations on the application. - c. The transaction might involve a "silent second;" Which of the following statements about subprime loans is FALSE: Select one: a. Not all subprime loans are predatory, but most predatory loans are subprime; b. Subprime loans can serve a legitimate purpose; c. Subprime loans generally have a higher risk of foreclosure than other loans; d. If a subprime loan is deemed predatory as to one borrower, it would be deemed predatory as to all borrowers. - d. If a subprime loan is deemed predatory as to one borrower, it would be deemed predatory as to all borrowers. Sandy purchases property from Ben. Sandy later discovers that Ben did not hold the title to the property and had no right to sell the property. Ben was guilty of ______ and is liable for damages suffered by Sandy in the purchase of the property Select one: a. Title fraud; b. Mortgage fraud; c. Title withholding; d. Misrepresentation. - a. Title fraud; Which of the following statements is the LEAST important determinant of whether a loan is suitable to a particular mortgage loan applicant: Select one: a. The borrower's likely future income; b. The borrower's financial reserves; c. The borrower's financial sophistication; d. The compensation to the mortgage loan originator. - d. The compensation to the mortgage loan originator. The "throw away second:" Select one: a. Is typically recorded, but sellers are asked to sign a release at closing table; b. Has payments that are always made and are expected to be paid; c. Has three different contracts of sale; d. Is a scheme with 3 settlements sheets and commission on lower selling price. - A "throw away second" involves a recorded second mortgage, but the seller agrees to sign a release at the closing table and the funds are never advanced and the loan is never repaid. The correct answer is: Is typically recorded, but sellers are asked to sign a release at closing table;` A large law firm would most likely seek to lease: Select one: a. An executive suite; b. Open space; c. A traditional office space d. Class C properties - The correct answer is: A traditional office space In an appraisal, what is the difference between a condition of sale adjustment and a market condition adjustment? Select one: a. Market conditions adjustments relate to whether the sale was an arm's length transaction where conditions of sale usually related to how long ago the sale occurred. b. Conditions of sale adjustments relate to whether the sale was an arm's length transaction where market conditions usually related to how long ago the sale occurred. c. There is no difference between the two. d. Conditions of sale relate to the type of property interest conveyed while market conditions relate to the financing of the property. - Conditions of sale adjustments relate to whether the sale was an arm's length transaction where market conditions usually related to how long ago the sale occurred. The correct answer is: Conditions of sale adjustments relate to whether the sale was an arm's length transaction where market conditions usually related to how long ago the sale occurred. he formula used to calculate the value of a property under the income approach is: Select one: a. Potential gross income divided by capitalization rate = value. b. Effective gross income divided by capitalization rate = value. c. Net operating income divided by capitalization rate = value. d. Net operating income divided by potential gross income = value. Feedback - The formula for determining the value under the income approach is net operating income divided by capitalization rate = value. The correct answer is: Net operating income divided by capitalization rate = value. For the years from 2000 through 2015, what was the highest percentage of home sales purchased by institutional investors? Select one: a. 12% b. 9.6% c. 8.25%. Most individuals who purchase a rental house have what expectations about their investment? Select one: a. Tax benefits during the holding period and appreciation in the future; b. High levels of positive cash flow; c. Tenants who will buy the house after a stated period of years; d. All of the above. - a. Tax benefits during the holding period and appreciation in the future; The largest of the industrial buildings, often with ceilings of 50 feet or more are: Select one: a. Warehouses; b. Distribution centers; c. Light manufacturing d. Flex buildings. - b. Distribution centers; The economic rent of a property or a unit is also known as the: Select one: a. Market rent. b. Contract rent. c. Actual rent. d. Statutory rent. - a. Market rent. The article cited in the text about hotel investment makes each of the following points, EXCEPT: Select one: a. First time hotel investors would be best advised to build a new hotel rather than purchasing an existing one; b. Investors carefully investigate the town in which to place a hotel before considering specific sites; c. Hotels should not be considered a passive investment; d. Marketing efforts are crucial for any hotel - a. First time hotel investors would be best advised to build a new hotel rather than purchasing an existing one; What is the impact of the "strict liability" standard for cleanup of environmental contamination? Select one: a. It means that the current and all past owners of a property must share in the clean-up costs of any contamination. b. It means that only the owner which caused the contamination is liable for the clean-up costs of any contamination. c. It means that the current owner is responsible for the clean-up costs of any contamination regardless of which owner caused the contamination. d. It means that no owner is responsible for the clean-up costs of any contamination unless it can be determined who was responsible for the contamination. - c. It means that the current owner is responsible for the clean-up costs of any contamination regardless of which owner caused the contamination. The most common type of industrial property in the United States is: Select one: a. Distribution centers; b. Warehouses; c. Light industrial; d. Flex buildings. Feedback The most common type of industrial property in the United States is light industrial. The correct answer is: Light industrial; - c. Light industrial; A subject property has 1,500 square feet of living space. A nearby comparable sale has 1,650 square feet of living space. The appropriate adjustment would be $5,000. This adjustment would be: Select one: a. Added to the sale price of the subject property. b. Subtracted from the sale price of the subject property. c. Added to the sale price of the comparable sale. d. Subtracted from the sale price of the comparable sale. - d. Subtracted from the sale price of the comparable sale. After an appraiser has made the appropriate adjustments when using the sales comparison approach, the appraiser will: Select one: a. Reconcile the indicated values. b. Average the indicated values. c. Stabilize the indicated values. d. Find the mean of the indicated values. - a. Reconcile the indicated values. Which of the following types of retail centers would draw its customers from the population within 3 miles of the store? Select one: a. Strip center; b. Neighborhood center; c. Community center; d. Regional mall. - b. Neighborhood center; What is subtracted from potential gross income to arrive at the effective gross income in a commercial building? Select one: a. Vacancy losses only. b. Collection losses only. c. Neither vacancy losses nor collection losses. d. Both vacancy losses and collection losses. - d. Both vacancy losses and collection losses. What is an estoppel certificate? Select one: a. It is the first step in the eviction process. b. It is a written statement signed by a tenant stating what rent the tenant pays. c. It is a statement from the property manager stating what rent is paid for a particular unit. d. It is a statement from the buyer to the tenant stating what rent will be charged upon closing of the transaction. - An estoppel certificate is a written statement signed by a tenant stating the amount of rent being paid by the tenant. The correct answer is: It is a written statement signed by a tenant stating what rent the tenant pays. The method of estimating construction costs that totals the raw materials required, the labor costs, management costs and a profit allowance is known as the: Select one: a. Square foot. b. Cubic foot. c. Unit in place. d. Quantity survey. - d. Quantity survey. The method of estimating construction costs that estimates the installed cost of each component part of the structure (such as walls, doors, windows, etc.) is the: Select one: a. Square foot. b. Cubic foot. c. Unit in place. d. Quantity survey. - c. Unit in place. A strip center is also known as a: Select one: a. Neighborhood center; b. Community center; c. Regional mall; d. Convenience center; - d. Convenience center; When is it especially important to "stabilize" the net operating income when using the capitalization approach to appraisal? Select one: a. When valuing a new building. b. When the net operating income has had wide variations over the past several years. c. When net operating income is below expectations. d. When expenses have been lower than expected for the past several years. - Stabilizing the net operating income is especially important when it has had wide variations over the past several years. A single family residence rents for $1,500 and recently sold for $187,500. What is its monthly gross rent multiplier? Select one: a. 125. b. 135. c. 150. d. 155. - a. 125. A Phase I Environmental Site Assessment would include each of the following, EXCEPT: Select one: a. An onsite inspection of the property. b. Interviews of knowledgeable persons such as previous owners and managers who would know the past history of the property. c. A check of local government records to review past land uses and building permits. d. Taking soil samples and obtaining lab tests. - d. Taking soil samples and obtaining lab tests. If you purchase a unit in a cooperative complex, what do you own? Select one: a. Your individual unit only; b. Only an undivided interest in the entire complex; c. Shares of stock in a corporation that owns the entire complex; d. Your individual unit and an undivided interest in the common areas. Feedback - c. Shares of stock in a corporation that owns the entire complex; The type of specialized-purpose center that typically have upscale national-chain specialty stores with dining and entertaining in an outdoor setting is known as a: Select one: a. Lifestyle center; b. Power center; c. Factory outlet; d. Theme/Festival; - a. Lifestyle center; Which of the following statements is the most accurate answer to the question of how capitalization rates are set? Select one: a. The buyer. b. The market. c. The seller. d. The real estate broker. - b. The market. The article cited in the text about hotel investment cautions new hotel investors about opening a full-service hotel. What are the author's reasons for doing so? Select one: a. The author says that full-service hotels are rarely profitable; b. The author says that restaurants vastly increase the number of inspections required; c. The author says that the cost and complications of a liquor license are excessive; d. The author says the restaurant and/or the bar are like running separate businesses and require their own expertise. - d. The author says the restaurant and/or the bar are like running separate businesses and require their own expertise. A retail center that usually has between 125,000 and 400,000 square feet of retail space and is often anchored by a discount store or supermarket is known as a: Select one: a. Strip center; b. Neighborhood center; c. Community center; d. Regional mal. Feedback - c. Community center; Which of the following statements is correct regarding the Section 8 housing program? Select one: a. It is designed for low income people; b. Recipients pay anywhere from 0% to 30% of their income for rent c. HUD administers the program and makes rental payments directly to the landlord; d. All of these choices. - d. All of these choices. What is the biggest difference between an independent living center and an assisted living center? Select one: a. The level of care; b. The size of the units; c. The distance between units; d. All of the above. - a. The level of care; Which of the following would be an example of functional obsolescence? Select one: a. A building that needs exterior paint. b. A retail center with an insufficient number of public bathrooms. c. A commercial structure in a city whose water supply has been contaminated. d. A property that has lost value due to increased traffic at a local airport. - b. A retail center with an insufficient number of public bathrooms. What is the primary significance of the Uniform Commercial Code in regard to a commercial real estate transaction? Select one: a. It allows lenders to place a lien against personal property, which could be significant if the sale includes personal property such as equipment or inventory, for instance. b. It is the primary federal law governing the sale of commercial properties in the United States. c. The Uniform Commercial Code governs the use of mortgages in a commercial real estate transaction. d. The Uniform Commercial Code is never an issue in any real estate transaction. - The Uniform Commercial Code allows lenders to create a lien against personal property, which could be an issue if the purchase of a commercial property includes significant items of personal property, such as equipment or inventory. The correct answer is: It allows lenders to place a lien against personal property, which could be significant if the sale includes personal property such as equipment or inventory, for instance The cubic foot method of estimating construction costs would most likely be used to estimate the cost to build which of the following structures? Select one: a. A warehouse. b. A shopping center. c. A four-plex. d. A convenience store. - a. A warehouse. A title commitment from a title insurance company for an ALTA policy would show which of the following: Select one: a. Liens against the property. b. Easements or encroachments affecting the property. c. Both of the above. d. None of the above. - c. Both of the above. A Phase II Environmental Site Assessment would include: Select one: a. Soil samples. b. Water samples. c. Subsurface soil borings. d. All of these choices. - d. All of these choices. The cost approach to appraisal is based primarily on the principle of: Select one: a. Anticipation. b. Substitution. c. Progression. d. Contribution. - b. Substitution. What is the formula for calculating depreciation under the age-life approach? b. Cooperatives; In order to be considered a high-rise according to Fannie Mae's classifications, an apartment building must have: Select one: a. 5 or more floors; b. 7 or more floors; c. 9 or more floors; d. 10 or more floors - c. 9 or more floors; When "baseball arbitration" is used in negotiating the rent for a lease extension, which of the following choices best describes the process? Select one: a. It is a form of mediation involving several rounds of negotiations. b. It involves hiring an appraiser to determine the fair market rent. c. It requires a panel of three different owners of similar properties setting an appropriate rent level. d. Each party submits a recommended solution and the arbitrator chooses which one is more reasonable. - In "baseball arbitration" each party submits a recommended solution and the arbitrator chooses which one is more reasonable. The correct answer is: Each party submits a recommended solution and the arbitrator chooses which one is more reasonable. The type of escalation clause that would require periodic appraisals of the property is: Select one: a. Step up rent increases. b. Indexed rent increases. c. Market rent increases. d. None of the above. - Market rent increases are tied to the value of the property and therefore require periodic appraisals of the property. The correct answer is: Market rent increases. Which of the following statements is true regarding recourse loans? Select one: a. In general, commercial mortgage loans are more likely to be recourse loans than are residential mortgage loans. b. A lender can foreclose against the property only if the loan is a recourse loan. c. Recourse loans are permitted for mortgages used to purchase a personal residence in all 50 states. d. None of the above. - Commercial loans are far more likely to be recourse loans (where the lender can get a deficiency judgment against the borrower if the foreclosure sale does not generate enough money to fully repay the loan). Many states prohibit deficiency judgments against loans to finance the purchase of a residential mortgage. The correct answer is: In general, commercial mortgage loans are more likely to be recourse loans than are residential mortgage loans. Which of the following statements is most accurate regarding the remedy for a landlord whose tenant commits a non-material breach of the lease contract? Select one: a. The landlord could evict the tenant. b. The lease contract should specify the remedy for a non-material breach. c. There are no remedies for a non-material breach. d. The amount of rent charged would become subject to renegotiation. Feedback - The correct answer is: The lease contract should specify the remedy for a non- material breach. If there is a year-end reconciliation clause in a percentage lease, when might the tenant be entitled to a rent refund of some amount? Select one: a. If the sales exceeded the breakpoint every month of the year. b. If the annual sales exceeded 12 times the monthly breakpoint. c. If sales exceeded the monthly breakpoint several times but total annual sales did not exceed the monthly breakpoint times 12. d. In each of these cases. - If sales exceeded the monthly breakpoint several times but total annual sales did not exceed the monthly breakpoint times 12. Mezzanine financing is best defined as: Select one: a. The use of a second mortgage as part of the initial financing. b. The type of financing used for particular types of industrial buildings. c. An intermediate financing between the property owner and the mortgage lender. d. A type of financing using the issuance of preferred stock by the corporation buying the property. - c. An intermediate financing between the property owner and the mortgage lender. A use and occupancy clause in a commercial lease prohibits a tenant from committing "waste." In this context, waste means: Select one: a. Excessive amounts of garbage which raises the landlord's operating costs. b. Using excessive amounts of water or electricity. c. A change in the condition of real property caused by a tenant that damages or destroys the value of the property. d. None of the above. - The correct answer is: A change in the condition of real property caused by a tenant that damages or destroys the value of the property. Each of the following statements about markets is correct, EXCEPT: Select one: a. A market is a medium that allows buyers and sellers of a specific good or service to interact in order to facilitate an exchange. b. Many markets exist in physical locations. c. All markets require personal interaction between the buyer and the seller. d. There are both wholesale and retail markets. Feedback - c. All markets require personal interaction between the buyer and the seller. The simplest, most desirable type of mezzanine financing, and the one least often available is: Select one: a. Assignment of the ownership. b. A cash flow note. c. A second mortgage. d. An equity position. Feedback - c. A second mortgage. A commercial mortgage loan has a prepayment penalty which starts at a higher level, decreases each year for several years, then disappears. This is called a(n): Select one: a. Interest guarantee. b. Lockout. c. Defeasance. d. Step-down. - d. Step-down. Which of the following documents would provide the most information about the tenants in a commercial building that is to be the collateral for a commercial mortgage loan? Select one: a. Proforma. b. Rent roll. c. Loan application. d. Form 1003. - The rent roll would show a great deal of information about each specific tenant. (Forrm 1003 is the Uniform Residential Loan Application and would not be used in a commercial transaction.) The correct answer is: Rent roll. The government purchases portion of the Gross Domestic Product would include: Select one: a. Defense spending. b. Transfer payments. c. Interest on the federal debt. d. All of the above. - a. Defense spending. Which of the following statements about subleases or assignments is TRUE? Select one: a. A sublessee will make the rent payments to the sublessor. b. An assignee will make the rent payments to the assignor. c. A sublease must expire at the same time as the sublessor's lease. d. When a lease is assigned, the original tenant is automatically free from any liability for the monthly rent. - c. Loan-to-value ratio. d. Debt Yield Ratio. - d. Debt Yield Ratio. If the money supply grows too slowly, the most likely risk could be: Select one: a. Inflation. b. High interest rates. c. Disintermediation. d. None of the above. - b. High interest rates. What is the benefit to a tenant of the non-disturbance clause in a lease? Select one: a. It gives the tenant some assurance that the tenant will not lose the lease if the property is foreclosed upon. b. It prevents the landlord from excessive on-site inspections. c. It prevents the property from going through a foreclosure. d. None of these choices. - a. It gives the tenant some assurance that the tenant will not lose the lease if the property is foreclosed upon. A provision in a commercial loan that prohibits early repayment of the loan for some period of time is known as a(n): Select one: a. Interest guarantee. b. Lockout. c. Defeasance. d. Step-down. - b. Lockout. If the money supply grows too quickly, the most likely risk could be: Select one: a. Inflation. b. Recession. c. High interest rates. d. Excessive unemployment. - a. Inflation. Under Regulation Z, which of the following types of loan originator compensation would be considered to be based on the terms or conditions of the loan: Select one: a. A higher compensation if the applicant accepts a prepayment penalty clause. b. A higher compensation if the applicant has a credit score above 720. c. A higher compensation if the applicant accepts a prepayment penalty clause and/or has a credit score above 720. d. All of these choices would be considered to be compensation based on the terms or conditions of the loan. - d. All of these choices would be considered to be compensation based on the terms or conditions of the loan. The finance charge, as computed under the Truth in Lending Act, would include each of the following, EXCEPT: Select one: a. Mortgage insurance premiums. b. Discount points. c. Appraisal fees. d. Loan origination fees. - c. Appraisal fees. The new Loan Estimate Form combines what previous forms? Select one: a. The GFE and initial TIL. b. The GFE and HUD-1. c. The TIL and HUD-1. d. The GFE and Special Information Booklet. - a. The GFE and initial TIL. Under Regulation Z, if a loan is subject to the Loan Estimate disclosure requirement, the earliest the loan could possibly close is: Select one: a. 3 business days after the Loan Estimate is delivered or mailed; b. 5 business days after the Loan Estimate is delivered or mailed; c. 7 business days after the Loan Estimate is delivered or mailed; d. 10 business days after the Loan Estimate is delivered or mailed. - c. 7 business days after the Loan Estimate is delivered or mailed; Bigcity Bank requires mortgage applicants to obtain a lender's policy of title insurance in order to obtain a mortgage loan. ABC Title Insurance is given as a recommended provider for the policy, with an estimated fee, but the consumer has the right to obtain coverage from another provider if so desired. The fee would be paid to the provider, not the lender. If the applicant chooses to obtain coverage from a different provider, what error tolerance factor would this estimate be subject to? Select one: a. This fee would not be subject to the error tolerance requirements. b. This fee would be subject to the 15% error tolerance requirements. c. This fee would be subject to the 10% error tolerance requirements. d. This fee would be subject to the zero error tolerance requirements. - Since the applicant exercised the right to shop for another provider, this title insurance premium would not be subject to any error tolerance requirements. (There is no 15% error tolerance category.) The correct answer is: This fee would not be subject to the error tolerance requirements. Each of the following loans would be subject to the Real Estate Settlement Procedures Act, EXCEPT: Select one: a. A conventional refinancing loan on a duplex. b. An FHA loan. c. A first mortgage that is made by a bank and held in its portfolio. d. An agricultural loan. - d. An agricultural loan. If a lender failed to give a borrower the Loan Estimate, the borrower could rescind the loan for up to: Select one: a. 30 days; b. Three years; c. One year; d. The maturity date of the loan. - b. Three years; Each of the following actions are recommended to those who have or are considering a Marketing Services Agreement, EXCEPT: Select one: a. The fees charged should not change unless the services there is an objective change in the services provided. b. The MSA partner should be designated as a "preferred provider" to consumers. c. The market value of the services provided should be determined or verified by a neutral third party. d. The contract should be carefully reviewed by an attorney who is well-versed and experienced with matters dealing with RESPA. - b. The MSA partner should be designated as a "preferred provider" to consumers. The form which replaced the HUD-1 or HUD1-a form is the: Select one: a. RESPA Disclosure. b. Closing Disclosure. c. Uniform Settlement Statement. d. None of these. Feedback - b. Closing Disclosure. Which of the following statements about Marketing Services Agreements (MSAs) is FALSE? Select one: a. The CFPB has released clear guidance on what it considers to be an acceptable MSA. b. When the CFPB reviews an MSA, it will want to see evidence that the promised services were actually provided. c. The CFPB believes that MSAs present the risk of steering consumers to the MSA partner. d. None of these statements is false. - a. The CFPB has released clear guidance on what it considers to be an acceptable MSA. Which of the following choices is the primary determinant of whether or not an affiliated company will be considered a "sham affiliate?" Select one: a. Whether the firm uses a DBA instead of its actual name. Select one: a. The loan cannot have a balloon payment at any time. b. The loan cannot have a balloon payment in the first 10 years of the loan. c. The loan cannot have a balloon payment in the first 7 years of the loan. d. The loan cannot have a balloon payment in the first 5 years of the loan. - The correct answer is: The loan cannot have a balloon payment in the first 7 years of the loan. What would be the consequences of a loan originator's failure to comply with the safe harbor provisions of the Regulation prohibition against steering: Select one: a. The loan originator would likely face fines and/or suspension or revocation of his or her mortgage loan originator license or registration. b. The loan originator would be deemed to have violated the prohibition against steering. c. The loan originator would be guilty of a misdemeanor. d. The loan originator would lose the protection of having been deemed to have complied with the prohibition against steering. Feedback - The correct answer is: The loan originator would lose the protection of having been deemed to have complied with the prohibition against steering. The Loan Estimate Form must be delivered to or mailed to the consumer no later than the third business day after: Select one: a. Initial substantive contact. b. Consummation of the loan. c. The consumer's acceptance of the proposed loan. d. Receipt of the application. - d. Receipt of the application. Which of the following practices are recommended when establishing a Marketing Services Agreement (MSA)? Select one: a. Entering into an MSA with an affiliated company. b. Entering into an MSA with a month-to-month term. c. Including fees for allowing access to the firm's sales meetings. d. None of the above. - d. None of the above. What is the CFPB's primary concern about Marketing Services Agreements (MSAs)? Select one: a. These MSAs are flatly prohibited. b. Many of these agreements are, in effect, a way to attempt to circumvent the prohibition against kickbacks and referral fees. c. These agreements need the prior approval of the CFPB, which often does not occur. d. None of these choices. - b. Many of these agreements are, in effect, a way to attempt to circumvent the prohibition against kickbacks and referral fees. Shortly after a loan is consummated an error was discovered in the Closing Disclosure that changed the amount paid by the borrower. The creditor would have _____ to deliver or mail a revised Closing Disclosure. Select one: a. 30 days from the borrower's receipt of the Closing Disclosure. b. 30 days from the creditor's discovery of the error. c. 60 days from the borrower's receipt of the Closing Disclosure. d. 60 days from the creditor's discovery of the error. - b. 30 days from the creditor's discovery of the error. The new Closing Disclosure Form combines what previous forms? Select one: a. The GFE and final TIL. b. The final TIL and HUD-1. c. The final TIL and Special Information Booklet. d. The GFE and HUD-1 - b. The final TIL and HUD-1. Once the Loan Estimate is delivered or mailed, the loan cannot be consummated for at least: Select one: a. 3 business days; b. 5 business days; c. 7 business days; d. 10 business days. - c. 7 business days; A bank owns a large number of REO properties. It maintains a practice that it will only give listings on these properties to real estate licensees who have referred borrowers to that bank. This practice is: Select one: a. Not a violation of RESPA. b. Not a violation of RESPA so long as the licensees use their best efforts to sell the properties. c. A violation of RESPA. d. Not a violation so long as the referral comes after the licensee has sold the property. - c. A violation of RESPA. Each of the following would be considered a loan from a "federally-related lender, EXCEPT: Select one: a. VA loans; b. Mortgage loans made by banks and sold to Fannie Mae. c. Mortgage loans made by private individuals. d. Mortgage loans made by mortgage companies and sold to Fannie Mae. - c. Mortgage loans made by private individuals. If a loan has a demand feature, the lender can: Select one: a. Require financial disclosures from the borrower. b. Require the borrower to make larger escrow account payments. c. Foreclose against the property without regard to the normal foreclosure procedures. d. Require the borrower to pay off the loan prior to the scheduled maturity date. - Require the borrower to pay off the loan prior to the scheduled maturity date. John decides to help his brother sell his house. He advises his brother about a market price for his house and helps him advertise the property. Select one: a. This is legal because the person is John's brother. b. This is legal if John receives no compensation for his help. c. This is illegal even if John receives no compensation. d. This is illegal because John is not licensed. - The correct answer is: This is legal if John receives no compensation for his help. Which of the following statements is NOT true about a community association manager? Select one: a. He must have a CAM license. b. He must be associated with a real estate broker. c. The management contract is with the community association manager. d. The community association manager collects the rents. - The false statement is that the management contract is with the community association manager. The contract is with the broker. The correct answer is: The management contract is with the community association manager. An exclusive right to sell listing Select one: a. does not have to have an expiration date. b. can be verbal. c. cannot obligate the seller for more than 120 days. d. earns the broker a commission regardless of who is the cause of the sale. - d. earns the broker a commission regardless of who is the cause of the sale. Which of the following statements is/are TRUE? Select one: a. Sally has an option to buy a piece of property, but finds another property she likes better. She allows her option to expire. The broker may disburse the option money to the optionor. b. A broker may withdraw his commission from the trust account when the transaction closes. c. A broker must pay the bank service charges on the trust fund out of his own funds. d. All of the above statements are true. - d. All of the above statements are true. A broker is being sued and as a protection the broker deposits a significant amount of money in the broker's trust account. This is known as: b. An offer must be accompanied by earnest money. c. Licensees must present all written and oral offers up to time of closing. d. Licensees must present all written offers up to time of closing. - Licensees must present all written offers up to time of closing. If a landlord and a tenant have a dispute in Georgia Select one: a. they may appeal to the real estate commission for a resolution. b. they must agree to binding arbitration. c. they may sue in a court of competent jurisdiction. d. they must be represented by a licensed Georgia attorney. - c. they may sue in a court of competent jurisdiction. REALTOR® A has a listing on a seller's home and the seller has accepted an offer. The offer is contingent upon the sale of the buyer's current home. REALTOR® B has a buyer who has made an offer. Under the Code of Ethics, what should listing REALTOR® A do? Select one: a. Ignore REALTOR® B's offer since the seller's home is already under contract. b. Reveal the existence of the contract but not the contingency. c. Reveal the existence of the contract and the contingency. d. Present the second offer to the seller without disclosing the existence of the offer or the contingency. - c. Reveal the existence of the contract and the contingency. A REALTOR® has a listing on a client's house. The sellers are getting a divorce and need to sell the home quickly. Under what circumstances can the REALTOR® reveal this fact to a potential buyer? Select one: a. Under no circumstances. b. Without restriction. c. Only if the buyer asks about the seller's motivation for selling. d. Only after getting informed consent from the seller. - d. Only after getting informed consent from the seller. A Realtor® who enters into a brokerage agreement with a buyer is obligated to disclose to the client each of the following issues, EXCEPT: Select one: a. That the seller's agent is forbidden by the Code of Ethics to reveal the terms and conditions of any offer made by the buyer to anyone other than the seller; b. The potential for additional or offsetting compensation from other brokers, from the seller or landlord, or from other parties; c. Any potential for the buyer/tenant representative to act as a disclosed dual agent, e.g., listing broker, subagent, landlord's agent, etc.; d. The Realtor®'s company policies regarding cooperation. - that the seller's agent is forbidden by the Code of Ethics to reveal the terms and conditions of any offer made by the buyer to anyone other than the seller; Under what conditions does the Code of Ethics permit a REALTOR® to refuse to submit an offer or counteroffer when the property is already under a contract for sale? Select one: a. Without restriction b. Under no circumstances. c. If the seller has waived the requirement in writing. d. If the transaction is within 10 days of closing. - Standard of Practice 1-7 states that offers must continue to be presented until closing unless the client has waived that requirement in writing. The correct answer is: If the seller has waived the requirement in writing. Which of the following practices would always be a violation of the Code of Ethics? Select one: a. A net listing. b. A listing broker who will cooperate with other brokers but will not pay compensation to the cooperating broker. c. Both of the above. d. None of the above. - a. A net listing Which of the following advertisements would violate the Code of Ethics prohibition against interference with existing exclusive brokerage agreements? Select one: a. A personal letter to all homeowners who have listed their homes for sale but have yet to sell. b. A personal letter to all homeowners in a community. c. Both of the above. d. None of the above. - a. A personal letter to all homeowners who have listed their homes for sale but have yet to sell. When can a REALTOR® contact a homeowner who already has an exclusive listing agreement with another broker? Select one: a. Without restriction as long as the discussion is in regards to a listing after the current listing expires. b. Only if the listing broker refuses to provide information about when the listing will expire. c. Only with the seller's permission. d. None of the above. - Only if the listing broker refuses to provide information about when the listing will expire. Realtors® may represent the seller/landlord and buyer/tenant in the same transaction: Select one: a. Under no circumstances; b. Only with full disclosures to both parties; c. Only with the informed consent of both parties; d. Only with both full disclosures to both parties and the informed consent of both parties. - d. Only with both full disclosures to both parties and the informed consent of both parties. NAR® arbitration can be required for commission disputes for which of the following members? Select one: a. A dispute between two brokers. b. A dispute between a broker and an associated salesperson. c. Both of the above. d. None of the above. Feedback - a. A dispute between two brokers. A Realtor® is a partner in a partnership that owns a rental property. When the property is sold, the Realtor® must disclose his or her ownership interest to the buyer or buyer's representative: Select one: a. If the Realtor® owns 10% or more of the partnership; b. If the Realtor® owns 5% or more of the partnership; c. If the Realtor® owns 1% or more of the partnership; d. In all cases, regardless of the Realtor®'s percentage of ownership. - d. In all cases, regardless of the Realtor®'s percentage of ownership. Under the NAR Code of Ethics, a consumer would be considered a "client" of a Realtor®: Select one: a. If the Realtor® acts as agent for the consumer; b. If there is a legally recognized non-agency relationship with the consumer; c. In either of the above circumstances; d. Any time a Realtor® works for or with a consumer in a real estate transaction. - c. In either of the above circumstances; In Case Study 2-15 the FHA contacted a REALTOR® to discuss a suspicion that local brokers had been engaged in defrauding the FHA by overstating the value of homes in the area. The REALTOR® knew that this was going on and some other brokers who had done so but refused to list any names for fear of retribution. How should the REALTOR® have handled this? Select one: a. Report the issue to the local police. b. Keep the information to himself. c. Report the matter to the Grievance Committee. d. File a criminal complaint to the US Attorney General. - c. Report the matter to the Grievance Committee. REALTOR® who is selling his or her own property is obligated to comply with the duties imposed by the Code of Ethics in which of the following circumstances: Select one: a. When the sale does NOT involve the MLS or cooperation with other licensees.