THE CE SHOP PRACTICE TEST SC REAL ESTATE CORRECT 100%
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Course
CE Shop
Institution
CE Shop
When performing a market analysis, given the adjusted sales prices of three comparables, which comparable would you weigh most heavily?
-The one that had more upward adjustments than the others
-The one that required less adjustment
-The one with an adjusted sales price higher than the actual sa...
THE CE SHOP PRACTICE
TEST SC REAL ESTATE
CORRECT 100%
When performing a market analysis, given the adjusted sales prices of three comparables, which
comparable would you weigh most heavily?
-The one that had more upward adjustments than the others
-The one that required less adjustment
-The one with an adjusted sales price higher than the actual sales price
-The one with the adjusted sales price lower than the actual sales price - ANSWER The one that required
less adjustment
**The comparable that required less adjustment overall (including both upward and downward
adjustments) will be the one most similar to the subject property. Therefore, it would be weighed most
heavily.
In South Carolina, the parties agree in the sales contract to a repair procedure unless what document is
attached?
-Amendment to Repair Procedure
-Due Diligence Addendum
-Seller Disclosure Statement
-Waiver of Repair Procedure - ANSWER Due Diligence Addendum
Without a buyer agency agreement in place, which party does the agent who's assisting the buyer
represent?
-No one
, -The agent
-The buyer
-The seller - ANSWER The seller
**If there is no agency agreement in place, the agent who's assisting the buyer represents the seller.
If special assessments apply to a property involved in a South Carolina sales transaction, who's
responsible for paying the assessment?
-The brokers representing the buyer and seller
-The buyer, if the assessment is applied prior to closing
-The closing attorney
-The seller, if the assessment is applied prior to closing - ANSWER The seller, if the assessment is applied
prior to closing
**The sellers are responsible for paying any special assessments applied before closing, and the buyers
are responsible for any that are applied after closing.
Mark is a seller who prepaid his property taxes. What happens to the amount he prepaid and won't
benefit from when he sells?
-He'll receive a credit at closing.
-He'll receive a debit at closing.
-The buyer must repay this amount when the next property taxes are due.
-The excess funds are deposited into the state's Widows and Orphans Fund. - ANSWER He'll receive a
credit at closing.
**Prepaid items are credited to the seller at closing. Accrued but not yet paid items are credited to the
buyer at closing.
Deducting the costs of maintaining and operating an income property provides a(n) _______ that's
attractive to many real estate investors.
-Credit boost
-Increase in equity
-Profit
-Tax shelter - ANSWER Tax shelter
, **Operating expenses can be deducted from rental income, and therefore provide a tax shelter that
makes investing more attractive.
Hiram plans to do a 1031 tax-deferred exchange. He just sold his property. How many days does he have
to close on a new property?
-180
-30
-45
-60 - ANSWER 180
Margo has found her dream house. It's listed at $370,000, and she plans to offer $365,000. She has a
letter from her lender stating that she's been pre-approved for a maximum $375,000 loan. Why should
she ask her lender to re-write the pre-approval letter?
-By law, the letter can only note that she's been approved for the amount she's offering.
-By providing the letter with her maximum loan amount, Margo risks reducing her negotiating ability.
-Pre-approval letters should only state that the buyer's income, assets, and liabilities have been verified.
-The lender must issue a separate letter for each offer the buyer intends to make. - ANSWER By providing
the letter with her maximum loan amount, Margo risks reducing her negotiating ability.
**If the sellers know that Margo has been approved for a loan amount higher than her offer, they may
be less willing to negotiate on price.
Which of the following could apply to closing costs for an investment property?
-Amortized over 17 years
-Amortized over the life of the loan
-Never deductible in the year they're paid
-Subtracted from the cost basis - ANSWER Amortized over the life of the loan
**Closing costs are added to the cost basis, are sometimes deductible in the year paid, and are often
amortized over the life of the loan.
Which of the following may be the result of building delays on a new construction?
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