National Final Exam #3

L is appraising a 25-year-old residence. Which of the following approaches to value should she use?

M, a married woman, is selling a home that is her sole and separate property. Still, the buyer\’s attorney insists that both M and her husband sign the deed because:

The difference between the fair market value and the debt that is owed against a property is called:

When a landlord wants to evict a tenant for failure to pay rent, what kind of legal action must the landlord undertake?

A homeowner wants to sell his home, but during the listing presentation he insists that the broker show the property to Caucasians only. Under these circumstances, what should the broker do?

When using the cost approach to value while appraising a small department store, the appraiser will need to determine which of the following?

The loan-to-value ratio represents the relationship between the:

In what circumstances is an item considered part of the real estate?

A person dies, leaving a will. The individual who is responsible for administering the will is called a/an:

Which type of deed limits the covenants of the grantor?

A mortgagee\’s title policy provides protection for the:

A property management agreement between Owner Q and ABC Realty calls for a commission rate of 6% of the first $350,000 in rents and 8% of the rents that exceed $350,000. If the previous year\’s total rent collected was $475,000, what was the amount of the management fee paid to ABC Realty?

Which of the following best describes a condominium?

A borrower financing the purchase of real property is required to sign a security instrument in order to:

S is appraising a 3,500 square foot house with six bedrooms and 1.5 baths. Because there aren\’t enough bathrooms for the number of bedrooms, S deducts $2,500 from his value estimate for:

An option to buy, when exercised, becomes a/an:

When making the required agency disclosure, an agent must always:

The interest paid on a real estate loan is:

Z purchases T\’s home and assumes T\’s FHA loan. How can T be assured he will not have any continuing liability for the loan after the sale is complete?

Which of the following would NOT provide constructive notice of an interest in real property?

Any change in a contract\’s terms should be:

A mortgage instrument that contains a clause allowing a portion of the security property to be released from the lien of the mortgage before the debt is fully paid is called a/an:

Discount points are a percentage of the:

A loss in value that is a cost that can be recovered is:

A person who receives real property by will is called a/an:

A loan not backed by a government agency is called a/an:

Which of the following is a characteristic of a graduated payment mortgage?

Which of the following is essential to the validity of a purchase andsale agreement?

The three-day rescission right established by the Truth in Lending Act applies to which of the following?

Broker K writes an offer to purchase for one of her listings. The offer is accepted. What should K do with the earnest money deposited by the purchaser?

A homeowner sells his own property, but is still required to pay a real estate commission. What kind of listing did the homeowner sign?

K purchases a house next to hers, then deeds it to her mother for her mother\’s life, specifying that it will belong to K after her mother\’s death. This is a:

When attempting to obtain a listing, a licensee tells a property owner he should sell his house before the neighborhood becomes integrated. This constitutes the illegal act of:

A married couple is listing their house for sale, and a salesperson is preparing the listing agreement. The agreement should be signed by:

Which of the following actions by a real estate broker would be unlawful?

The seller listed the property for $95,000. Assuming that their listing agreement is typical, the broker would NOT be entitled to a commission if the seller:

If a VA loan is assumed and the original veteran borrower is released from liability, it is called a/an:

M is R\’s listing broker. M receives three offers for R\’s property. Two of the offers are reasonable offers. The third offer is for little more than half of the listing price. M is sure R will NOT accept the third offer. M should:

The gradual liquidation of a debt with installment payments that include both principal and interest is called:

A metes and bounds description uses:

A brother and a sister own a rental home as joint tenants. The brother is nearly destitute and deeply in debt when he dies. Which of the following statements is TRUE?

Several $100,000 homes were built in an exclusive subdivision where the existing homes had been selling for between $350,000 and $450,000. The result was that values throughout the neighborhood declined. Which appraisal principle explains this phenomenon?

The Js have a 25-year loan at 8.5% interest, with a current principal balance of $149,000. How much will their next monthly payment of $1,200 reduce the principal balance?

The period during which improved property will yield a return that is attributable to the improvements, over and above the land itself, is called its:

Two friends purchased real property together with the provision that in the event of the death of one of the friends, the other would own the entire property. How did they take title?

Which of the following is a requirement for conveying title to real property?

The term that refers to a property\’s price in terms of cash or its equivalent upon which a willing buyer and willing seller will agree, where neither is under any undue pressure and both are typically motivated, have adequate knowledge, and are acting in their own best interest is:

The interest rate of an adjustable rate mortgage (ARM) changes when:

All of the following are requirements for creating an agency, EXCEPT:

Someone who deliberately misrepresents a material fact with the intention of causing another person to suffer a loss may be guilty of:

Which of the following statements about options is TRUE?

The type of tax levied according to the market value of the property is a/an:

Both private restrictions and zoning define and limit land uses for what purpose?

Which of the following is true about a contract for deed (land contract)?

On October 2, a buyer makes an offer, which she agrees to keep open for three days. The seller rejects the offer on the same day. On October 3, the seller changes his mind and notifies the buyer that he is accepting the offer. Which of the following is TRUE?

A security that is required to be registered by federal law must be registered with the:

Which of the following would NOT be a way for the government to regulate or take control of privately owned property?

Zoning in an area has been changed from mixed use to residential only. An existing store that previously conformed to the zoning is no longer in compliance. This conflicting use is:

Under which of the following circumstances would a contract be considered void?

A seller realized $112,000 from the sale of her home. She paid a 6% commission, $2,450 in discount points, and $1,236 in other closing costs. How much did the property sell for?

The proper exercise of the state\’s police power can be used to accomplish all of the following, EXCEPT:

S owns a small commercial building. She later sells a 50% interest to her friend J. S and J hold title as:

While using the sales comparison (market data) approach to value, an appraiser finds three comparable properties that recently sold for $195,000, $202,000, and $207,000 respectively. In order to determine what the comparables indicate about the value of the subject property, the appraiser should:

The Ms want to build a garage on their property but their plans don\’t meet the local zoning law\’s setback requirements. In order to build the garage, they must apply for a:

A borrower secures a mortgage loan in the amount of $95,000, with semiannual interest payments of $4,275. What was the interest rate charged by the lender?

Broker S has terminated his management agreement with an owner. What is Broker S required to do with the tenant\’s security deposits?

R buys a home in the Island View subdivision. The subdivision\’s CC&Rs require all fences to be of natural cedar, but several property owners have painted their fences over the years. When R paints his fence, his neighbor sues for violation of the CC&Rs. The judge allows the painted fence to stay because:

A house with an apartment above the garage is sold on March 5, with the closing scheduled for March 20. The apartment rents for $600 per month, due on the first of the month. At the time of the sale the rent is current. The escrow agent is using a 360-day year, and the parties agree that the seller receives rent for the day of closing. Which of the following statements about proration of the current month\’s rent is CORRECT?

Z failed to pay a contractor for labor and materials in the repair of her home. This may result in a/an:

Which of the following would NOT result in the termination of an easement appurtenant?

When a lender forecloses on a life estate, what kind of title does the lender acquire?

A parcel of land has dimensions of 940 feet by 1,660 feet. Twenty-two percent of the parcel is to be dedicated to the public for schools and roads. The remaining land is subdivided into one-quarter acre lots. How many lots would there be?

Each of the following applies to appurtenances, EXCEPT:

R owns three pieces of real estate in King County. If a judgment is entered against her in King County, it will create a lien against:

L owns the six-unit apartment building in which he lives. According to the Federal Fair Housing Act, as amended in 1988, L may enforce which of the following rules?

A major department store leases a large space in a local mall, and it agrees to pay the mall owner, in addition to a base rent, a percentage of its gross earnings. What kind of lease has the store entered into?

The greatest ownership rights one can have in real estate are referred to as a:

Which of the following situations would be exempt from the Federal Fair Housing Act of 1968? Discriminatory conduct in the:

An owner whose property is landlocked would request that a court award him:

The grantee of a deed discovers a cloud on the title. The grantee is most likely to prevail in a lawsuit if the grantor gave a:

An eight-year-old property was recently appraised at $125,000. It has depreciated 35% since it was built. What was it originally worth?

Under the Real Estate Settlement Procedures Act (RESPA), which of the following would be an illegal kickback?

J receives a deed from K for some raw land in the country. Less than a year later, W files a lawsuit against J, claiming that she, not K, was the true owner of the property at the time of the conveyance. W\’s lawsuit is called a:

A home that accumulates ash and endures noxious odors because it is situated near an industrial neighborhood is suffering from:

When a transaction is finalized, the buyer and the seller are each entitled to a copy of the:

M enters into a purchase and sale agreement that calls for a base purchase price of $100,000 for the home and one acre of land, plus $15,000 for each additional acre, with the total area of the land to be identified by a survey. It is determined that there is a total of 7.3 acres. What is M\’s purchase price?

An individual has an income-producing property for sale that generates $64,250 in gross earnings. The property has $24,360 in operating expenses and credit and vacancy losses. With a 10% capitalization rate, how much could an investor afford to pay for the property?

Easements, rights of way, and other rights and privileges that go along with land ownership are:

A tenant under a net lease will pay which of the following?

A property owner\’s financial advisor, on learning that his client\’s apartment complex is no longer profitable, advises the client to change the apartments into condominiums. The process of changing apartments into condominiums is called:

What does the term \”escheat\” refer to?

The sheet metal used on a roof to prevent water seepage is called:

The Thompson’s homesteaded their residence, which had a market value of $239,000 and a deed of trust against it for $220,000. A contractor who built a deck for them filed a mechanic\’s lien after the property was homesteaded. The lien is:

Which of the following statements concerning estates is correct?

Daniel injured himself while swimming in Petra\’s pool. If Daniel sued Petra and received a $2,500 judgment in his favor, the resulting lien would be a/an:

Which of the following is not a way in which an agency can be created?

Compared to other investments, real property takes more time and effort to invest in, and must be purchased in more expensive units. Therefore, its return should be:

Effective delivery of a deed depends on:

When a purchase and sale agreement contains a time is of the essence clause, if the buyer fails to meet a deadline set in the contract:

A seller\’s counteroffer: