Colibri Real Estate Exam Questions and Complete Solutions

Colibri Real Estate Exam Questions and Complete Solutions What is the primary purpose of instituting FACTA? - Answer: To combat identity theft, and enhance the accuracy and privacy of information held by credit reporting agencies. In the case of multiple offers who should review counteroffer terms that deviate from the standard fill-in-the-blank forms? - Answer: An attorney Conventional loans usually require the debt ratio be? - Answer: Less than 36% What is formed when people join together and own or control housing or related facilities? - Answer: Co-op Ownership Commercial property is used specifically for? - Answer: Business Properties Price is the number that quantifies? - Answer: Cost The services a licensees owes ONLY to a client? - Answer: Agency Disclosure How long does an individual have to file a complaint with the Housing and Urban Development Agency(HUD)? - Answer: 1 Year What actions make up the majority of exclusionary discrimination cases against landlords? - Answer: False Advertisements What does a For Sale By Owner(FSBO) seller sign that identifies the buyer, and guarantees the agent a commission if the buyer purchases? - Answer: Commission Agreement for Sale What clause allows for parcels and units to be sold from a blanket mortgage? - Answer: Release Clause To avoid litigation, what should all Real Estate(RE) companies using websites develop? - Answer: An Internet Advertising Policy What is it called when the lack of public sites in urban minority areas have contributed to the urban decay? - Answer: Public Domain Racism What gives the public constructive notice of a grantee's ownership? - Answer: Recording the Deed Life insurance companies typically invest how much of their assets in RE? - Answer: (3/4), three- fourths Why should agents avoid expressing value judgements when advertising? - Answer: So as to not mislead the consumer With a reverse annuity mortgage, the lender is making payments to? - Answer: Borrower An insured conventional loan is similar to a Federal Housing Administration(FHA) loan, except the insurer is? - Answer: Secondary Lender What protected class was added by Fair Housing Amendments Act in 1988? - Answer: Families with children, and people with disabilities According to government regulations, the majority of a savings and loan association's assets must be in? - Answer: Real Estate Loans What type of deed offers the greatest protection and is the most used? - Answer: General Warranty Deed In universal agency who is held accountable for the actions of the agent? - Answer: The Principal Who is responsible for enforcing Code of Ethics, providing mediation and holding arbitration hearings? - Answer: National Association of Realtors(NAR) What article in Broker/Salesperson Independent Contractor Agreement says salesperson cannot charge a commission less than the brokers established %? - Answer: Commissions Where would the seller give information about private or public architecture review control of the property in the Seller's Property Disclosure? - Answer: Structural Items Effective Gross Income (-) Total Operating Expenses= - Answer: Net Operating Income If an agent is not sure what another party is saying, what should they do? - Answer: Ask Questions Objective infeasibility means what? - Answer: No one can render performance What type of loan is linked to an economic index? - Answer: Adjustable Rate Mortgage(ARM) Described as a measure of the strength of a currency or monetary system? - Answer: Purchasing Power What are the largest sources of household wealth? - Answer: Home Equity/ Retirement Accounts An arrangement in which a manufacturer sells a product to a reseller only on condition that the reseller also buys another less popular product. - Answer: Tie-in-Arrangements An agreement among competitors to raise, lower, maintain, or stabilize prices or price levels. - Answer: Price-Fixing Allows law enforcement officials to obtain a search warrant anywhere a terrorist-related activity has occurred. Search of the specially designated nationals list maintained by the United States Office of Foreign Assets Control. - Answer: Patriot Act Search What type of marketing dominates the advertising platform? - Answer: Internet Advertising The exchange or substitution of a new debt for an existing debt by mutual agreement? - Answer: Novation What was created to insure buyer & seller have knowledge of all settlement costs? - Answer: 1974 RESPA In a buyer agency agreement what funds need to be explained? - Answer: Broker fee & explanation of Real Estate Recovery Fund What person performs a VA appraisal? - Answer: VA fee appraisers A real estate firm may offer a computerized loan organization system (CLO), who does RESPA say must pay the fee for such a service? - Answer: The borrower A closing disclosure must contain the information prescribed in the: - Answer: TRID rule What type of insurance would a borrower purchase to protect the lender from potential losses? - Answer: Private Mortgage Insurance If an agent is in competition with 2 other listing agents for the listing, what will give the agent an edge? - Answer: Commission Rates What type of RE user would be interested in convenience and access to services & other facilities? - Answer: A residential user A broker price option must include what the price was based on and: - Answer: Applicable market data According to the CAN-SPAM Act, commercial e-mailers must reveal the identity of the sender and: - Answer: The name of the advertiser entity An underwriting red flag occurs when there is a gift letter without? - Answer: Any bank statements to back it up Exclusionary discrimination is typically? - Answer: Subtle A market study is made to find those comparable sales and listings that are what? - Answer: Similar to the property being appraised Credit unions and commercial banks are what type of lenders? - Answer: Primary mortgage market lenders What provision in the Independent Contractor Agreement says the associate will not hold the broker responsible for claims based on the associate's representation of the agreement? - Answer: Indemnification The beginning statements of the Code contains principles that we consider? - Answer: Aspirational Compensation terms must be determined by cooperating brokers when? - Answer: Before beginning efforts to accept the offer of cooperation What, with respect to contests, is prohibited by State Law and the Code of Ethics? - Answer: Giving a misleading description of a prize or gift What is a measurement of how much is invested in the property for tax purposes? - Answer: Basis (cost) How can a seller determine that the mortgage payoff amount listed on the settlement is accurate? - Answer: The amount should match the amount quoted by the buyer's lender. What is most common source of major problems in new construction? - Answer: Drainage What mortgage clause allows the mortgages to pledge a property as collateral? - Answer: Granting Clause Insurance companies are organized as what? - Answer: Stock & mutual A capital loss can only be claimed on? - Answer: Investment Property A popular program is FHA Condominium Loans, which are designed to encourage lenders to offer affordable mortgage credit to those who have non-conventional forms ownership. Insurance for this type of housing is provided through: - Answer: FHA Section 234(C) Under which of these theories is a foreclosure processed through a judicial proceeding? - Answer: Title Theory Who generally enforces bylaws and manages the overall property in a condominium? - Answer: Homeowner's Association / Board of Directors Rescinding a contract occurs when: - Answer: One party to a contract agrees that the contract is null & void According to the US Department of Housing and Urban Development, more than what percent os the US residential housing stock contains some lead-based paint? - Answer: About 30% What % of today's sales are FSBO? - Answer: 7% What does ESIGN require of consumers before electronic records can be used to provide them with information that, under another law, must be provided to them in writing? - Answer: Affirmative Consent Banks mortgage lenders hold the title? - Answer: Title Theory Borrower holds title? - Answer: Lien Theory Renunciation contract breech may be either? - Answer: Express & Implied What HUD person interviews complainants? - Answer: Intake Specialist Who can request CLUE reports on a property? - Answer: Owner, Insurer, & Lender A seller leaseback is also called? - Answer: Rent-Back Agreement Party who has full knowledge, but reaches an invalid conclusion. - Answer: Mistake of Law Money that the buyer or seller receives at closing is called what? - Answer: debit What is the purpose of negotiating? - Answer: Settling Disputes What doctrine states a court has determined a contract unenforceable due to needless delay? - Answer: Doctrine of Laches Assessed Values (-) Exemptions= - Answer: Tax Base In reference to fair housing fines, what does HUD do? - Answer: HUD does NOT give fines, recommends fines to federal court proceedings The Fair Housing Initiatives Program(FHIP) is the only federal grant program with the sole purpose of what? - Answer: Supporting private partnerships in preventing and overcoming housing discrimination Who is responsible for lead-based paint knowledge if the salesperson doesn't know, and the seller does? - Answer: Seller/Landlords A good negotiator is a good? - Answer: Bargainer/ Communicator Protects consumers from misleading practices by the credit industry and provides them with reliable information about the costs of credit. - Answer: Regulation Z Required to foreclose on a Deed of Trust. Lender does not have to go through the courts to foreclose; and it is therefore, a quicker process. - Answer: Non-Judicial Foreclosure Investor clients will normally be far better informed about the market, require less hand-holding, and bring? - Answer: Less Opportunity for the agent What mortgage clause states that the trustee will accept the trust when the deed of trust is "duly executed & acknowledged" and is properly recorded? - Answer: Trustee Acceptance HUD's attempts to resolve a complaint, by getting assurance from the person against whom the complaint was filed that he or she will remedy the alleged violation, is called? - Answer: Conciliation Agents who choose to change their insurance providers often decide to purchase what type of coverage to cover any possible claims that may be made months or years after switching policies? - Answer: Liability Insurance What section of the Closing Disclosure shows how much ($) money the borrower needs to bring to closing? - Answer: Projected Payments What is the most important factor for a prospective property owner? - Answer: Area/ Location What type of insurance would a borrower purchase to protect the lender from potential losses if the borrower defaults? - Answer: Personal Liability Insurance