Final Exam TN Real Estate Course Questions and Answers with Verified Solutions

Final Exam TN Real Estate Course Questions and Answers with Verified Solutions A Tennessee licensee must use the "Exclusive Right to Sell" form required by the licensee's broker. According to the level of authority delegated to the agent, the usual real estate agency is a limited agency. When must the contract be in writing? John is agreeing to sell his shed to Shawn for $1,000. One disadvantage in using active listings for comparables is they provide somewhat dubious comparisons because listing prices are not selling prices. Why is it sometimes necessary to include a bill of sale with a purchase contract? A bill of sale confirms that all promised inclusions are in fact part of the conveyance. Prior to the acceptance of a purchase contract, the seller must provide the buyer with a written property condition disclosure if the property is a residential property of less than 5 units. Which HUD document provides information to builders regarding fair housing compliance? Fair Housing Act Accessibility Guidelines The two restraints of trade of most concern to real estate brokers are conspiracies to fix prices and group boycotts. The payment amount a borrower makes periodically to a lender consists of a portion of principal and a portion of interest. If a loan is subject to RESPA, the lender must give the borrower an estimate of closing costs within three days of receiving the loan application. "Farming" is the practice of prospecting for business in a selected area. ___________ is normally the single most important element in a home's value. Location ______________ property is land or improved property with buildings designed for humans to live in, such as single-family homes, apartments, or condominiums. Residential When does a purchase and sale agreement become enforceable? At time of offer delivery and acceptance by seller Which of the following is subject to the requirements of RESPA? A single-family home purchase financed by a federally-insured loan A licensee found guilty of engaging in the unauthorized practice of law could face suspension of license. An affiliate broker's license should be displayed in her broker's principle place of business. Among the primary sources of real estate ethics and standards is state real estate licensing regulation. In contract law, which of the following is NOT required for the contract to be valid? Both parties to the contract must be 21 years old. In Tennessee, all advertising for real property must be under the firm's name. Honestly representing property condition is a duty a licensee owes to clients and customers. How can a licensee be at risk when disclosing an agency relationship? If the licensee fails to inform and disclose properly Earnest money must be deposited into an escrow account "promptly" upon acceptance of an offer unless stated otherwise. "Promptly" usually means within 72 hours. Which of the following statements is true? Proper disclosures prevent clients from claiming they were misled. Which of the following statements is false? An agent may enter into a legally binding oral agency relationship with a client. Which of the following is not an area of risk in terms of unintentional misrepresentation? Stating that a client should seek legal counsel. Cancellation and discharge of a contract includes all of the following EXCEPT Revocation without repercussions FHA guidelines require the income ratio on a mortgage loan to be no more than 29% What is a property manager's most important duty? To maximize ROI for the property owner What are the two ways escrow funds are most often misused? Commingling and conversion The Tennessee Landlord and Tenant Act allows the landlord to enter the premises in any of the following situations EXCEPT to quiet down noisy tenants. What is the primary method for transferring risk in real estate transactions? Carrying an Errors & Omissions policy What is the amount a lender normally requires to be included for taxes and insurance in a borrower's monthly mortgage payment? 1/12th of the annual real estate taxes and hazard insurance payment Upon execution of the contract, a licensee should provide all signatories with copies of any listing or contract relevant to the real estate transaction. A broker has an agency relationship with a client. An affiliate broker is working as that broker's agent. This kind of agency is called subagency. Strategies for managing risk fall into all except which of the following categories? Protection An owner is not liable for errors and omissions in the condition disclosure provided the error was based on information provided by a professional engineer or inspector. The rules for internet advertising in Tennessee are the same as those that apply to all advertising, regardless of medium. What is the difference in the principal broker's supervisory responsibilities to an employee affiliate broker and an independent contractor affiliate broker? There is no difference in the supervisory responsibilities of the broker to any affiliate. How is etiquette distinguished from ethics and laws? Ethics and laws must be obeyed; etiquette is voluntary. When a code of ethics violation complaint goes to a Grievance Committee, the Committee has the authority to dismiss the complaint. Under which type of listing agreement is the listing broker entitled to a commission regardless of who is the procuring cause of the sale? Exclusive right-to-sell What right is transferred by a lease? Right to exclusive possession and use for a period When does the Commission allow a licensee NOT to carry E&O insurance? When the license is in retired status When is the latest an agent may make a verbal disclosure of agency status to a buyer who has no agent? Before providing any real estate services to the buyer Anyone who feels discriminated against on the basis of race in the selling or renting of residential real estate may seek legal recourse as a result of the Jones v. Mayer Supreme Court ruling. Agricultural property management is the only property management specialty where you might be expected to manage a staff of specialists. Which of the following documents is a Tennessee broker allowed to prepare without being charged with practicing law without a license? A listing agreement The agent owes which of the following duties ONLY to a client: Obedience Violators of federal fair housing laws may be punished with fines and jail. A licensee can get into trouble by exceeding the authority of the agreement. Who is liable for errors or inaccuracies on the property condition disclosure if the condition change occurred after the disclosure was delivered to the buyer? No one It is_____________for a real estate licensee to pay a commission to an unlicensed individual or company. unlawful In Tennessee a property manager who performs duties that include negotiating security deposits, rents, and lease terms must be licensed.