National Real Estate Remedial Test 2024.
Olivia took out a 15-year loan secured with a deed of trust. She worked two jobs in order to pay the loan back and finally made her last payment this month. What happens now? - ANSWER Because the property deed was held by a third-party trustee instead of the lender, the trustee grants a reconveyance deed to Olivia.
Warren signed a contract with the Samsons for the sale of property he didn't own. What type of contract is this? - ANSWER A party can't promise to do something impossible in a contract. Doing so makes the contract void.
Which amendment to CERCLA says that "innocent landowners" aren't responsible for clean-up of hazardous contamination? - ANSWER The Superfund Amendments and Reauthorization Act, or SARA, says that innocent landowners aren't responsible for clean-up of hazardous contamination.
With the cost approach to value, what is the replacement cost? - ANSWER The replacement cost reflects the cost to build a functionally equivalent improvement, as opposed to the reproduction cost, which is the cost to build an exact replica of the subject, with the same materials and deficiencies.
Antje's clients closed on their property yesterday, but Antje still has some paperwork that she needs to deliver to them as soon as possible. Under which fiduciary duty is Antje acting? - ANSWER The duty of accounting may continue even after the transaction closes. The agent must account for any documents or money belonging to the client until it is delivered to the appropriate party.
When real estate licensee Brian discovered that Arnold was using a 'Choose Your Neighbor' letter to market a property without also listing the property in the MLS, in the local paper, or even putting a for sale sign in the yard, what charge could he bring against Arnold to the National Association of REALTORS®? - ANSWER REALTOR® Brian could charge Arnold with violating Article 10 of the Code of Ethics, which prohibits REALTORS® from agreeing to discriminate against people belonging to a protected class.
What is estate at sufferance? - ANSWER Estate at sufferance is when a tenant remains
on the property after the lawful authority has expired (a holdover tenant), after which the
landlord may evict.
Which entity typically enforces the code restrictions and licensing and insurance requirements for contractors, thereby enforcing the building code? - ANSWER While builders and developers self-regulate to some degree, they're not responsible for enforcing the building code. This is the local building department's responsibility. Under which types of agency agreement may a buyer and agent operate? - ANSWER Open, exclusive right to represent, and exclusive agency
What is a survey? - ANSWER A survey is used to create, verify, or correct a legal description. It's a professional on-site measurement of the lot lines and dimensions of a property.
Melisa's mother gave her house to Melisa, along with a signed copy of the deed granting ownership to Melisa. Years later, Melisa decides to downsize by selling the property. The title company shows that the property is still in Melisa's mother's name. What does Melisa have to do to clear this up? - ANSWER To preserve the chain of title, Melisa needs to record the signed deed. Then future records will show an unbroken chain of title.
Prior to the ______, there was no legal protection for women who endured sexual harassment from landlords and sellers when they attempted to obtain housing. - ANSWER The Housing and Community Development Act of 1974 included gender or a person's sex in the list of protected classes.
Which document is used to give a buyer an overview of the title history and information about what is or isn't covered in an insurance policy? - ANSWER Title insurance companies issue a preliminary report with the current title history and any liens or encumbrances. It outlines what the insurance company will or won't cover on its forthcoming insurance policy if the title is found to be acceptable.
When is a lead disclosure required? - ANSWER A lead disclosure is required for residential properties built before 1978 because paint manufacturers used lead in paint before it was banned that year.
Which of the following is a potential disadvantage for a buyer who enters into a lease with an option to buy contract? - ANSWER Depending upon the contract's terms, a potential disadvantage for a buyer who enters into a lease with an option to buy is that he could lose any funds credited to the purchase price if he breaches the terms of the lease.
Joe gave land to a school, but still wanted to have some control over its use, so a deed was prepared that gave the school title as long as the land is used for educational purposes. What type of interest does the school have? - ANSWER A fee simple determinable has limitations as to what can or can't be done with a property. It uses phrases such as "so long as," "while," or "during" to describe the required condition.
You represent the buyer in one transaction and the seller in a different transaction. What type of agency relationship do you have with the buyer? - ANSWER You have a buyer agency relationship with the buyer in one transaction and a seller agency relationship with the seller in the other transaction. What does the Federal Trade Commission consider to be an unfair ad? - ANSWER Any
ad or business practice that causes or is likely to cause injury is considered an unfair ad, according to the FTC's Unfairness Policy Statement.
As part of the sales contract, Garth, the seller, was supposed to provide a copy of the seller's disclosure to the buyer, Melanie, but he failed to do so. What type of contract is this? - ANSWER A voidable contract can be cancelled by one or more parties because it's missing an essential element. In this situation, Melanie, the buyer, has the right to cancel the contract and have her earnest money refunded.
How are principal meridians and baselines used in the rectangular government survey system? - ANSWER Each legal description in this system originates at the intersection of a principal meridian and a baseline.
When the lender gathers all kinds of information about the borrower's assets, debts, income, employment history, and pulls their credit report, the buyer is ___________________. - ANSWER This is all part of the application process.
In which of the following situations would the state be able to use its power of escheat? - ANSWER Escheat occurs when a property owner dies without a will in place, and no heirs or creditors can be found.
Which of these situations might be addressed by limitations or a subject to clause in the deed Jane is using to convey property to Moira? - ANSWER A great example of deed limitations is the restrictions that may be placed on a property by an owners association.
A subject to clause may refer to an easement held by a neighboring property to get to a road or water source.
Hannah wasn't able to get the financing to open her boutique, so her mother came on as a silent partner and provided additional cash. Hannah and her mother have an agreement that states Hannah's mother can't be held financially or legally liable if there are any problems with the store. What type of contract clause is this? - ANSWER Indemnifying one of the contract parties releases that party from all liability or loss.
Drew and Hank were camping at Hank's riverfront cabin. Hank told Drew that he so rarely used the cabin that he was thinking of selling it. Drew said that he'd buy it from Hank for $80,000, and Hank agreed that was a fair price. It's two months later, and Hank is upset that Drew now says he won't buy it. Why isn't this contract enforceable? - ANSWER The statute of frauds requires that real estate contracts be in writing. Drew's offer was oral, and thus didn't create an enforceable contract.
Local authorities lack police power over which of the following? - ANSWER Local authorities have police power over budgeting, zoning, and subdivision development, but
they lack police power over federal government construction projects.
