Real Estate Principles Final Exam Questions With Verified Solutions., Exams of Real Estate Management

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Real Estate Principles Final Exam

Questions With Verified Solutions.

Anything that is fastened or attached to real property permanently is considered to be: - Answer Real Property A quitclaim deed releases all present claims, rights and title of the: - Answer Grantor When a creditor wants to satisfy a judgement which was levied against another person, the creditor would: - Answer Obtain a writ of execution Before a mechanics lien is effective it must be: - Answer Verified and recorded Discrimination by a real estate licensee based on race is: - Answer A violation of the regulations of the Real Estate Commissioner, against public policy, and unethical Upon the signing of a real property sales contract: - Answer An equitable title passes to purchaser All California Real Estate Laws are created by: - Answer Acts of the legislature The 36 sections in a township are numbered from 1 through 36. Section 1 is located in the: - Answer Northeast corner Which of the following would be a discriminatory act under the Commissioner's Regulations? - Answer Posting a sign on the property indicating a preference for female renters, designing an ad for general circulation appealing to persons of a specific religion to purchase within a given area, and refusing to list a property in an area occupied by persons of a race other than the licensee. The type of interest usually charged on home loans is: - Answer Simple

A landowner is notified by a railroad company that it plans to cross his property with a railroad line. If the landowner refuses, the railroad company can proceed by the use of: - Answer Eminent domain Title to real property that is transferred by a will is considered: - Answer A devise A real estate broker received 40 acres of land valued at $300 per acre as a commission from the seller. Two weeks after escrow closed, the broker was offered $400 per acre for the land. If the broker accepts the offer he: - Answer Will be acting in an acceptable manner The words "procuring cause" would have an important meaning to which of the following? - Answer A disputed over commission on an open listing Which of the following is not an essential element of a contract? - Answer Performance Under the Street Improvement Act of 1911, the city is authorized to assess each owner for the work completed. These improvements are assessed on the basis of: - Answer Front footage The real estate tax fiscal year is for the period: - Answer July 1 to July 1 The landmark case of the United States Supreme Court which prohibited discrimination in housing was: - Answer Jones vs. Mayer Most real estate syndicates that have been created in California have taken the form of a: - Answer Limited partnership Under the California Veterans Home and Farm Purchase Act of 1974, the purchaser acquired possession through a: - Answer Land Contract Which of the following has the control over the approval of a subdivision under the Subdivision Map Act? - Answer Planning Commission A grant deed: - Answer Warrants that the property has not been previously conveyed by the grantor

When an appraiser analyzes the rent while using the income approach, he should base his appraisal on which of the following characteristics of the income? - Answer Durability, quality, and quantity An income property was appraised for the $100,000 based on a 6% capitalization rate. If an investor used an 8% capitalization rate, the property would be: - Answer $75, Which of the following appraisal reports would be the most comprehensive and complete? - Answer Narrative Once an abstract of judgment is recorded it remains a lien on all real property for: - Answer Ten years If a note in the amount of $22,250 specifies monthly payments over a period of 30 years at 6.6% interest per annum, what is the first month's interest payment? - Answer $122. "Duress" is a term which is most closely associated to matters concerning: - Answer Contracts Which of the following statements is true with respect to an option? An option is: - Answer Valid if consideration is delivered even if it is less than $ The term "Realtor" is a trade name and only persons who are members of which of the following organizations have the right to use the term? - Answer National Association of Realtors The California State Agency that governs the issuance of liquor licenses is the: - Answer State Franchise Tax Board The gross multiplier method of appraisal would be of little value when appraising: - Answer Public buildings Blank, special, restrictive, and qualified are all terms used to specify types of: - Answer Endorsements

The phrase in a loan contract that specifies "all due and payable upon the happening of a certain event" would be classified as: - Answer An acceleration clause When a property is sold during a tight money market and the existing loan contains an alienation clause, which of the following is most likely to occur? - Answer Buyer will secure new financing Which of the following would be considered a quiet title action? - Answer Court action to remove a cloud on the title The government's control over land use, planning and zoning are an important example of: - Answer Police power Which of the following acts of a real estate licensee would not be a violation of the real estate law? - Answer Taking a net listing A corporation is prohibited from holding title to real property in California with any one as a joint tenant because: - Answer If it's perpetual existence Charles died intestate and left a $60,000 Estate but no heirs. His state would: - Answer Revert to the state When land gradually builds up as a result of the action of water, it is known as: - Answer Accretion A first trust deed can usually be distinguished from a second trust deed by the: - Answer Time and date of decoration A lender agrees to make a loan on a large commercial complex provided the borrower gives the lender a 2% interest in the ownership. This type of loan would be known as a: - Answer Participation loan Which of the following is not a requisite for creation of an enforceable leasehold agreement? - Answer That rent payments be made in advance

Which of the following is not an essential to the validity of a deed? - Answer Payment of financial consideration The trust deed and note on a conventional loan is held by the: - Answer Lending institution When a Cal-Vet wishes to purchase a home and use his or her California veterans benefits he or she would make application to the: - Answer Department of Veterans Affairs A real estate subdivider who resides in Hawaii is required to comply with various laws if he wants to offer his property located in Hawaii for sale in California. The law that he would be most concerned with would be the: - Answer California Real Estate Law If you wish to realize a $37.50 per month income on an investment that represents a 9% return, the amount to be invested must be: - Answer $5, Deed restrictions may be terminated in all of the following ways, except: - Answer Voluntary cancellation by grantee Permissive use of a road across real property would cause a prescriptive easement in: - Answer None of the above To an appraiser, a definition of value is: - Answer The relationship between desirous persons and things desired, the ability of one commodity to command other commodities in exchange, and the present worth of all the right to future benefits arising from the ownership of property FHA has established certain MPR's that apply to loans that they insure. MPR is an abbreviation for: - Answer Minimum Property Requirements Under a construction loan, the final payment to the borrower is generally released when the: - Answer Lien period has expired Recording a deed: - Answer Presumes delivery of the deed

An executrix of an Estate is: - Answer Named in the decedent's will When a broker advertises a listed property for sale, the broker may not legally use an ad: - Answer That gives the impression that the broker is the owner of the property A client hires a broker to buy a parcel of land for a specified sum on his behalf. The broker however purchases it for himself at a lower price and then sells it to his client at a higher price without revealing his costs. This is an example of: - Answer Secret profit An appraiser intends that the estimate of value as disclosed in his or her appraisal report on a property be valid: - Answer As of the date of the appraisal only An apartment building develops a net income of $15,000. If it were sold at a price based upon a capitalization rate of 8%, the selling price would be: - Answer $187, Which of the following state agencies is empowered to prevent acts of discrimination in housing accommodations in California because of race, color, religion, national origin or ancestry? - Answer Department of Fair Employment and Housing The person who most likely would make use of the legal remedy known as "Unlawful Detainer" would be a: - Answer Lessor An estate in which a tenant who rightfully came into possession of a property, and who retains possession after the expiration of the term without he consent of the landlord is known as: - Answer An estate at sufferance If the Federal Reserve wants to increase the amount of money available to member banks to ease a tight money market it could: - Answer Lower the minimum reserves required by its member banks All of the following would have an effect on the final estimate value when making an appraisal of an old family residence except: - Answer Original cost of the residence

A restrictive covenant contained in a deed which prohibits sale to persons of a particular race will: - Answer Have no effect in the conveyance and the covenant will not be enforceable Which of the following would not be classified as a specific lien? - Answer Judgment A title plant is a: - Answer Collection of real estate records In a business partnership, if one of the partners dies, the surviving partner: - Answer Becomes exclusive manager of the partnership business and retains title to the partnership property until he winds up the partnership business Enforcement of the State Housing Law is accomplished through the: - Answer Local building inspectors The stated policy of the Real Estate Commissioner is to create a "color-blind" industry which can help society obtain voluntary, equal opportunity in fair housing. What does this mean? - Answer Maintain an attitude that is actually free from bias and color-blind to appearance, that race, creed or color is not a material fact in real estate transactions, and do unto others as you would have them do unto you State law requires that every city or county create a planning commission: - Answer Without exception If there is a conflict between the signed escrow instructions and the signed deposit receipt, which of the following would be binding? - Answer The escrow instructions A person that is employed by another to act on his or her behalf may be considered: - Answer An employee, an agent, and an independent contractor To hold real property as tenants in common, individuals must: - Answer Hold undivided interests The least contract is considered: - Answer Personal property An estate of inheritance or a perpetual estate would be: - Answer A fee simple estate

The end result of most profit and loss statements is to ascertain: - Answer Net income When a listing is signed by a seller and broker, a fiduciary relationship is created between the broker and the: - Answer Seller Which of the following would not be classified as an institutional lender? - Answer Mortgage company Which of the following represents a gross misrepresentation by the agent? - Answer The representation is an obvious falsehood, the representation is made with the knowledge of it being a falsehood, and the representation caused the aggrieved party to enter into the contract Most real estate contracts are in writing on reprinted forms. Some of the terms of these contracts must be written in and other parts are reprinted. In the interpretation of such contracts: - Answer The written parts take precedence over the printed parts A cautious buyer paid $200 for a four-month option to purchase a property for $30,000. Under these circumstances, each of the following are true except: - Answer Optionee has created a legal interest in the property According to the provisions of both federal and state civil rights legislation, discrimination due to race, color, creed or national origin in housing is: - Answer Unenforceable, unlawful, and illegal Which of the following is generally demanded in every sale of real property in California? - Answer A policy of title insurance An appraiser in analyzing the data for his final estimate of value on a property would give least consideration to: - Answer The assessed value of the property Which of the following is not considered in determining whether an item of property is a fixture? - Answer Cost of item The commission to be paid to a broker in a probate sale is set by the: - Answer Court

A formal declaration before a notary public or other qualified by a person who has executed an instrument, that such execution in his or her act and deed is called: - Answer An acknowledgment The value of a commercial property is set at $400,000 by using a net income of $36,000 and a 9% capitalization rate. If you used a 12% capitalization rate, the value of the property would be: - Answer $300, One of the chief advantages of the market data approach in the appraisal of real property is that: - Answer It is the easiest method for a salesperson to learn and use In comparing the cost of reproduction of two buildings of the same square footage, a two-story house usually: - Answer Costs less than a one-story house What is the annual interest rate on a $16,000 loan when the interest payments are $160 per quarter on the full amount? At least; - Answer 4%, but less than 5% Land which is subject to an easement is said to be: - Answer Encumbered Private restrictions on use can include: - Answer Deed restrictions, easement and rights of way, leases and mortgage notes Under the law of Agency, a fiduciary relationship is created between the broker and the seller upon execution of the listing agreement. As far as the broker's responsibility to third parties, the broker: - Answer Must be fair and honest A lease of real property for a fixed period of time at a set rate of rent creates: - Answer An estate for years All of the following are personal property except: - Answer Easements A valid deed vests title in the grantee when the deed is: - Answer Delivered

A valid recorded homestead will not protect the homeowner against the foreclosure of: - Answer A mortgage, a trust deed, or a mechanic's lien