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CE SHOP REAL ESTATE PRINCIPLES PRACTICE TEST well answered to pass
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CE SHOP REAL ESTATE PRINCIPLES PRACTICE TEST well answered to pass
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CE SHOP REAL ESTATE PRINCIPLES PRACTICE TESTJulie has received notice that the house she is renting was sold in foreclosure. She has a month-to-month
lease, so how long does she have until her lease may be terminated? - correct answer ✔✔90 days
Amy acts like a salesperson and is supervised by a broker, but she holds her broker's license. What is her job title? - correct answer ✔✔Associate broker
Which one of the following statements about investors and tax depreciation is true? - correct answer ✔✔Investors can depreciate an appreciating asset.
Which of these contract-specific requirements for a lease prohibits minors from entering into a lease agreement? - correct answer ✔✔Legal capacity
Trudy loved her new neighbors. The investor couple bought every available house on Trudy's block and was working hard to renovate them and increase their value. Trudy decided that she'd sit back, relax, and let her property's value go up, too, thanks to ______. - correct answer ✔✔Progression
Sheila's financing calls for the use of a promissory note. What's a promissory note? - correct answer ✔✔The borrower's promise to repay a certain sum of money to another party (the lender or holder of the note) under specified terms
Which of the following lease agreements should be accompanied by an agency disclosure? - correct answer ✔✔15-month lease
What does EER stand for with regard to air conditioners? - correct answer ✔✔Energy efficiency ratio
EER stands for energy efficiency ratio and is calculated by dividing the unit's British thermal units (BTUs) by the electricity needed to power the unit. The higher a unit's EER, the more energy efficient it is. Phoebe's gross monthly income is $4,200, and she has $360 in monthly non-housing debt payments. The
lender's qualifying ratios are 28% for the housing ratio and 36% for the total DTI ratio. What's the maximum housing payment she can afford? - correct answer ✔✔$1,152
The maximum house payment is the lesser of the amounts calculated using both ratios. DTI: $4,200 x .36
= $1,512. $1,512 - $360 = $1,152. Housing ratio: $4,200 x .28 = $1,176. Phoebe's maximum payment is $1,152.
This is a loss of money or anything of value, due to failure to perform. - correct answer ✔✔Forfeiture
A common forfeiture in a real estate transaction occurs when the buyer defaults on terms and forfeits the earnest money.
Which type of analysis starts with a visit to the property, a search on the MLS, and a comparison of comparable sales, and hopefully ends in a listing for a real estate licensee? - correct answer ✔✔Comparative market analysis
This describes a CMA. These don't always end in listings, however.
When a buyer breaches the real estate sale contract, the seller may file a lawsuit for compensatory damages. Which of the following best describes compensatory damages? - correct answer ✔✔Compensation for actual loss based on the contract's value.
Compensatory damages compensate a party for actual loss based on the contract's value.
How can a foreclosure process be temporarily stalled? - correct answer ✔✔By filing for Chapter 7 bankruptcy
Hal and Sara own a 212-acre farm. Their property is landlocked, but they have permitted water rights to use the stream located six miles away for irrigation purposes. What kind of water rights do they hold? - correct answer ✔✔Prior appropriation The doctrine of prior appropriation grants water rights based on need, not adjacency. Hal and Sara likely live in the western part of the U.S. where many states subscribe to this doctrine.
First-time home buyers who've had a Roth IRA account for at least five years may withdraw an amount that equal to the contributions they've made to use as a down payment. After that, how much more can they withdraw to help with a home purchase without penalty? - correct answer ✔✔Up to $10,000
How long after a notice of cessation or completion is filed can a contractor file a mechanics lien? - correct answer ✔✔Within 60 days
Which of these is true about the assessed value of real estate? - correct answer ✔✔It's the value used to
calculate the property taxes, and it's based on a percentage of the market value.
Assessed value of a property is a percentage of the market value, and it's used to calculate the amount of property tax the owner will pay.
Which of the following is the best definition of a township? - correct answer ✔✔A 36-square-mile square formed when using the rectangular survey system
The Siegels are purchasing a commercial investment property and plan to use straight-line depreciation on their financial statements and tax calculations. Which of the following would NOT be included in the Siegels' depreciation basis calculations? - correct answer ✔✔The loan origination and lender fees that they paid at closing
* The depreciable basis is made up of the sales price plus any acquisition costs, such as title insurance, and capital improvements. Loan costs aren't included in the basis, but something like electrical system upgrades are capital improvements.
What is the danger of a seismic hazard area? - correct answer ✔✔Landslides or liquefaction
* A seismic hazard area is designated as such because of the potential for landslides or liquefaction resulting from earthquake activity What is the starting point for any land surveyor who has been asked to perform a survey? - correct answer ✔✔A review of existing historical records
How many parties does a mortgage involve? - correct answer ✔✔Two: borrower and lender
* A mortgage involves two parties: the borrower and the lender. A trustee is only used with a deed of trust.
Tom and Jim are neighbors. Jim wants to buy Tom's rental property. In the contract they sign, Jim is identified only as "the neighbor." Which statute or contract element does this violate? - correct answer ✔✔The statute of frauds
* The statute of frauds requires not only that a contract to convey real property be in writing, but also that the contract identify the parties to the contract.
Loans for ______ purposes don't require TILA disclosure. - correct answer ✔✔Business
One of these parties is likely to be held liable for an injury resulting from the condition of the premises. Who is it? - correct answer ✔✔A residential landlord promises to repair the exposed wiring in the laundry room, but forgets —until someone is electrocuted.
* Residential landlords are obligated to repair defects that are reported to them.
Generally, there are covenants between the borrower and the lender within a mortgage document. Which of the following is a mortgage covenant? - correct answer ✔✔Pay any charges and assessments against the property.
* Covenants usually include paying charges and assessments against the property, maintaining both the property and hazard insurance, and keeping the property in good condition.
Colleen and Judy purchased a dilapidated townhome in an estate sale. Due to their fix-up work and the current economy, the property value has skyrocketed. They decide to sell it to get their equity out of it. After they list it, a woman comes forward, saying she is an heir to the previous owner and lays claim to
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