Exam (elaborations)

Alabama Real Estate License Exam 175 Questions Correct Answers

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Alabama Real Estate

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Alabama Real Estate

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alabama real estate license exam 175 questions

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Alabama Real Estate License Exam 175 Questions
Correct Answers

After passing state exam, you have ___ days to apply for a Temporary License, either
on an Active or Inactive basis. >>90

Temporary Licenses are only valid for ___ year(s), and cannot be renewed. >>1

For an Original License, you must pass a ___ hour post-license course. >>30

If Temporary License is ACTIVE, the post-license course must be completed within ___
months. >>6.

If the post-license course is not completed within ___ year(s), the Temporary License
lapses. This period begins on the FIRST DAY of the month AFTER passing the state
exam. >>1

For Broker's License, applicant must have ACTIVE Salesperson License for ___ out of
___ years immediately preceding the application. >>2/3

The fee to transfer your Salesperson License to a new Qualifying Broker is $___. >>$25

An owner's mortgage includes a clause requiring a prepayment penalty. Three percent
of any outstanding loan principal would be charged by the lender if the owner paid off
the principal before the scheduled time. Payments were $296.88, due on the first of
each month, and included both principal and interest in arrears at 8% per annum. After
the owner's July 1 payment, her loan balance was $8,946.23. On August 1, after
handing her lender the check for her August 1 payment, the owner paid off the entire
remaining loan balance. What is the approximate prepayment penalty? >>The monthly
house payment, $296.88, includes both interest and principal. The prepayment penalty
is charged only on the principal, not on interest. Therefore, one must determine how
much the new principal loan balance will
be after the August 1st house payment is made. The calculations are as follows:

The loan balance after the July 1 payment is $8,946.23 x 0.08 interest rate = $715.70 a
year ÷ 12 months = $59.64 interest for July.

$296.88 monthly house payment $59.64 interest = 237.24 principal payment on August
1 payment.

$8946.23 loan balance $237.24 principal paid in August leaves new principal balance of
$8708.99 after August 1st payment.

This is the amount on which the prepayment penalty will be based:

,$8708.99 x 0.03 penalty = $261.27

A managing broker requires his licensees to mention a particular lender to buyers. The
broker has a financial interest in this particular mortgage lender. Which of the following
should the licensee recommend to buyers? >>Consider this lender, disclosing the
broker's interest, and other lenders.

Licensees should generally avoid recommending only one lender, and if a financial
interest is involved, it should be disclosed. Since rates can change, a licensee most
likely would not know which lender has the best rates. Licensees may provide a list of
lenders without having to display the lenders in any particular order.

When using the sales comparison approach, a licensee determines that a comparable
property's tile floor in the entry hall is worth $2,000. The subject property does not have
tile floors at all. Which of the following adjustments should be made? >>The comparable
should be adjusted downward.

In the sales comparison (market data) approach to appraisal, it is always the
comparables that are adjusted, never the subject property. If the comparable is better
than the subject property, the adjustment to it is downward. If the comparable is not as
good as the subject property, the adjustment to it would be upward.

On February 1, a licensee with ABC Realty takes a 3month exclusive right-to-sell listing
on a house. On March 1, the licensee moves out of state and inactivates his license.
What happens to this listing? >>It remains a valid exclusive right-to-sell listing contract
with ABC Realty.

The listing belongs to the brokerage firm; it does not belong to an individual licensee.
The licensee takes the listing on behalf of the firm, and, if the licensee leaves or
becomes unlicensed during the listing, the listing would remain in whatever form it was
originally taken. The listing would still be in effect with the firm until it expires or is
terminated.

A person bought property from a seller and received a general warranty deed. Two
years later, the seller's brother came forth and claimed he had an ownership interest in
the property. The brother stated he knew the court would uphold his interest. In a
general warranty deed, the buyer is protected from this situation by the covenant-- >>--
of seisin.

Although all covenants in a general warranty deed work together to protect the buyer,
the covenant of seisin specifically guarantees that the owner owned the real estate at
the time of the sale and had the right to convey it.

A listing licensee has what obligations to a buyer? >>A licensee's duties to a buyer or
customer are fairness, honesty, and accuracy.

, A builder is obtaining a construction loan of $95,000 for a single-family residence. Under
the Truth-in-Lending Act, disclosure of a prepayment penalty by the lender is-- >>--not
required for a business loan.

The Truth-in-Lending Act is applicable to individual home owners, but it does not apply
to a construction loan for a builder because the loan is for a business purpose.

To qualify as a tax-deferred exchange, a property must be-- >>--held for productive use
in trade or business.

To defer the gain on the sale of an income-producing property, a tax-deferred exchange
may be used.

An office building is valued at $800,000 when the annual net income is capitalized at a
rate of 20%. If the operating expenses and vacancy and rent loss total 40% of the gross
income, what is the approximate gross annual income? >>$266,667

The income approach to value is calculated as follows:

Annual net income divided by capitalization rate equals value.

Therefore, net income ÷ 0.2 $800,000.

The net income is $800,000 × 0.2 = $160,000.

The net income is 60% (100% 40%) of the gross income.

The gross income is $160,000 ÷ 0.6 = $266,667.

AREC has ___ commissioners; each commissioner serves a ___ year term, with no
more than ___ consecutive terms. >>9 commissioners; 5 years per term; 2 consecutive
term max.

AREC commissioners are appointed by the ___ with the advice and consent of the ___.
>>Governor; Senate.

Commissioners must have been an Alabama resident for ___ years, and licensed in
real estate for ___ years. >>10; 10.

AREC commissioners are paid ___. >>$300/month.

Salesperson applicants must pass State Exam within ___ months of finishing the pre-
license course. >>6 months.

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Exam (elaborations)

Alabama Real Estate License Exam 175 Questions Correct Answers

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