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Modern Real Estate Quiz 678 review questions and AnswerKey.
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Modern Real Estate Quiz 678 review questions and AnswerKey.
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Modern Real Estate QuizCircle the letter of the Answer that corresponds to the displayed Question.
1. net lease
A. a mortgage that requires the mortgagor to pay a constant amount, usually monthly, that will completely pay off the loan amount with the last equal payment.
B. Plants that do not require annual cultivation and are considered real property.
C. provides that in addition to the rent, the tenant pays all or some of the property charges such as maintenance, property taxes, and insurance; sometimes called a triple net lease.
D. The country's central banking system, which controls the nation's monetary policy by regulating the supply of money and interest rates
2. Consideration
A. That received by the grantor in exchange for a deed. Something of value that induces a person to enter into a legally enforceable contract.
B. the external underside of the eave; usually contains ventilation for the attic/roof
C. The right to use the land of another for a particular purpose.
D. 1)acceleration clause 2)prepayment penalty clause 3)due-on-sale clause
3. Agent
A. regulates the amount of money that be required as a security deposit and what the landlord can do with that deposit
B. General real estate taxes that are levied for the general support of the government agency authorized to impose the levy.
C. An article installed by a tenant under the terms of a lease and removable by the tenant before the lease expires.
D. one who represents the interest of another person.
4. Declaration of Restrictive Covenants
A. A declaration of limitations established by a developer.
B. sandwich lease
C. imposes restrictions and limitations on high-cost loans; revises permissible fees and charges on certain loans; prohibits unfair or deceptive practices by lenders
D. when the broker/firm represents the buyer and the seller in the same transaction
5. option to purchase
A. an agreement b/w property owner and possible buyer, secured by the payment of an option fee, to buy or not to buy property within a specific time period at negotiated terms.
B. The law pertaining to the period of time within which certain actions must be brought to court or be lost.
C. One entitled to receive a remainder interest in some estate sometime in the future.
D. The most popular repayment plan; both the interest rate and the debt service amount are set for the duration of the loan
6. Market
A. story-high space below the first floor; floor is usually concrete slab
B. a loan in which the monthly payments increase annually, with the increased amount being used to reduce directly the principal balance outstanding and thus shorten the overall term of
the loan.
C. A place where goods can be bought and sold and establish value
D. A person's present right to an interest in real property that will not result in possession or enjoyment until someone in the future, such as a reversion or right or reentry.
7. Fair Credit Reporting Act
A. federal law giving consumers the right to view and correct their credit information
B. rights arising from traditional property law
C. One broker is specifically authorized to act as the exclusive agent of the principal; broker receives a commission if any broker is procuring cause; seller can sell w/o obligation.
D. A contract that complies with all the essential elements of a contract.
8. Assessment
A. A mandatory agency information brochure that a licensee must give to and review with consumers in all real estate sales transactions no later than first substantial contact; it does not
create agency.
B. Items, called chattels, that do not fit into the definition of real property; movable objects like; furniture, clothing, jewelry, money, vehicles, etc.
C. Broker
D. An official valuation of property for the purpose of establishing assessed value for tax purpose.
9. Straight Line Depreciation
A. the vertical members in the wall framing; usually placed 16-24 inches apart and serve as main support for the roof and/or the story above
B. When the cost of an asset is depreciated evenly over its useful life.
C. the overhand of a sloping roof that extends beyond the walls of the house.
D. An appraisal technique that determines assessed value for all lands in a given area by applying an overall percentage increase of decrease.
10. Novation
A. a flat strip of wood or metal that encloses the ends of the rafters; gutters are usually attached to it.
B. Areas outside incorporated limits that are subject to the zoning restrictions of a municipality
, C. Physical or design features that are no longer considered desirable by property buyers but can be replaced or redesigned at low cost. ex: changing fixtures
D. Substituting a new contract for an old one or substituting new parties to an existing contract.
11. Emblements or Fructus Industriales
A. a relationship in which the agent is placed in the position of trust and confidence to the principal.
B. Growing crops, such as grapes and corn, that are produced annually through labor and industry; also called fructus industriales. Usually considered to be personal property,
C. A method of condemnation in which title and possession of private property can immediately be transferred to a public authority.
D. compensation provided by the principal to the firm, contingent on the firm successfully performing the service
12. like-kind properties
A. let the buyer beware
B. the only legal way a landlord can evict a tenant; through a hearing before a magistrate in small claims court.
C. a tax term used in exchanges; property may be exchanged for life in kind property and the tax postponed (does not refer to the physical similarity of the properties).
D. takes place when agents do not have actual knowledge of a material fact but should reasonably have known of such a fact.
13. insulation
A. also called a "term loan", it only calls for periodic payments of interest.
B. pieces of plasterboard, asbestos sheeting, compressed wood-wool, fiberboard, or other material placed between walls and ceilings to protect the interior from heat loss.
C. The act of encouraging people to sell or rent their homes by claiming that the entry of a protected class will have a negative impact on property values.
D. provides that in addition to the rent, the tenant pays all or some of the property charges such as maintenance, property taxes, and insurance; sometimes called a triple net lease.
14. There is no federal exemption to the Fair Housing act if a _____ is involved.
A. IRS
B. Broker
C. Land; a portion of the earth's surface extending downward to the center of the earth and upward infinitely into space, including all things permanently attached to it, whether naturally or
artificially
D. One broker is appointed as sole agent of the seller and is given the exclusive right, or authorization, to represent the property in question
15. Commission
A. compensation provided by the principal to the firm, contingent on the firm successfully performing the service
B. The principle that affirms that the value of any component of a property is defined by what its addition contributes to the value of the whole or what its absence detracts from that value.
C. 1) One owner only 2) interest 100% 3) one signature only when sold unless a married person - spouse signs to extinguish elective share rights 4) marriage of an owner does not
automatically change to tenancy by entireties 5) heir ship rights
D. refers to the presence of one or more individuals who have not reached the age of 18 and who live with either a parent or legal guardian. The term also includes a woman who is
pregnant.
16. listing agreement
A. Caused by factors outside the subject property & is not curable. ex: proximity to a polluting plant
B. the final inspection of the property by the buyer prior to closing to assure that the seller has vacated, made required repairs, and delivered the property in the condition it was in at
contact.
C. An employment contract between a property owner and a real estate firm/broker by which the broker is employed to find a ready, willing and able buyer for the owner's real estate on
the owner's terms, for which service the owner agrees to pay a commission.
D. Ownership rights in a parcel of real estate to the water, minerals, gas, oil, and so forth that lie beneath the surface of the property.
17. direct reduction loan
A. a loan that requires a fixed amount of principal to be paid in each payment with the amount applied to interest varying as the balance is reduced
B. modeled after the Residential Agreements Act, it establishes uniform rules for landlords, tenants, and their agents involved in the handling of short-term rentals under 90 days in length
where tenant has primary residence elsewhere.
C. ratio of debt to value of the property
D. the primary duty of the land lord to supply fit and habitable premises to the tenant.
18. holdover tenant
A. One who acts as an intermediary on behalf of others for a fee or commission; licensed to list, lease, buy, exchange, auction, negotiate or sell interest in real estate for others for a fee
B. Has all of the elements of a valid contract; however, neither party can sue the other to force performance; valid as between the parties.
C. a person who retains possession of leased property after the lease has expired; the landlord may continue to accept rent or start eviction procedures.
D. A decree issued by a court.
19. Avulsion
A. The sudden tearing away of land, as by earthquake, flood, volcanic action, or the sudden change in the course of a stream. The loss of land may not result in loss of title to the property.
B. the space between the ground surface and the first floor; frequently found in homes w/o basements that are not built on a slab foundation
C. The most popular repayment plan; both the interest rate and the debt service amount are set for the duration of the loan
D. Land at the coast between average high tide and average low tide this is owned by the state of North Carolina.
20. nonjudicial foreclosure
A. one of a series of sloping beams that extends from the center ridge board to an exterior wall and provides the main support for the roof.
B. It limits coverage of a specified property in an insurance policy.
C. This means that the contract must be performed within the time limit specified, and any party who has not performed on time is liable for breach of contract.
D. a foreclosure under power of sale in which the deed of trust does not have to be foreclosed through a court action.
,21. wraparound loan
A. a mortgage loan in which the lender, in exchange for a loan with a lower interest rate, participates in the profits (if any) the borrower receives when the property is eventually sold.
B. a foreclosure under power of sale in which the deed of trust does not have to be foreclosed through a court action.
C. The time a buyer has to have property inspected, title examined, and review any leases to determine if the property meets his or her needs.
D. enables a borrower who is paying off an existing mortgage to obtain additional financing from a second lender or the seller.
22. reconciliation
A. an IRS sanctioned method for real estate investors to defer taxation of capital gains by making a property exchange rather than by selling the investment property
B. the final step in the appraisal process, in which the appraiser combines the estimates of value received from the sales comparison, cost, and income capitalization approaches to arrive
at a final estimate of market value for the subject property.
C. also called a "term loan", it only calls for periodic payments of interest.
D. the fiduciary relationship between the subagent ant the principal
23. Joint Tenancy
A. exaggerated comments or opinions; "This house has the best view in town!"
B. The form of foreclosure used in a title theory state; also called a nonjudicial foreclosure.
C. A concurrent form of ownership of real estate between two or more parties who have been named in one conveyance as joint tenants. Ownership interest may be unequal. Right of
survivorship is not automatic in NC but can be added by an attorney.
D. Property regarded as undesirable because of events that occurred there; also called psychologically impacted property. Some conditions; gang-related activity, proximity to a nuclear
plant, and even the alleged presence of ghost.
24. partially amortized fixed-rate mortgage
A. a loan in which the monthly principal and interest payments are a constant amount, but that payment amount is not sufficient to completely pay off the loan within the loan term; balloon
payment due at maturity
B. a horizontal board laid on edge, resting on the beams that provide the main support for the floor.
C. In NC, the most common title for a real estate sales contract
D. The act of encouraging people to sell or rent their homes by claiming that the entry of a protected class will have a negative impact on property values.
25. Economic obsolescence (incurable)
A. A real estate licensee who performs real estate activities under the supervision of a licensed real estate broker-in-charge. Must complete post-licensing courses to remove the
provisional license status
B. modeled after the Residential Agreements Act, it establishes uniform rules for landlords, tenants, and their agents involved in the handling of short-term rentals under 90 days in length
where tenant has primary residence elsewhere.
C. the extra thick framing over doors and windows to bear the weight of the building above the opening
D. Caused by factors outside the subject property & is not curable. ex: proximity to a polluting plant
26. Supply
A. Estimating the replacement cost of a structure based on the construction cost per unit of measure of individual building components, including material, labor, overhead & builders
profit.
B. The amount of goods available in the market to be sold at a given price. The term is often coupled with demand'
C. An item of personal property that has been converted to real property by being permanently affixed to the realty.
D. The one who receives title
27. Age Life Method of Depreciation
A. Prohibits creditors from discrimination on the basis of race, color, religion, national origin, sex, marital status, age, and receipt of public assistance.
B. The easiest but least precise way to measure depreciation that uses the effective age of a building & its economic life.
C. implements the Truth in Lending Act requiring credit institutions to inform borrowers of the true cost of obtaining credit
D. 10 day period after the auction in which the borrower can try to raise the necessary funds to redeem the property.
28. Foreclosure
A. insurance provided by a private carrier that protects a lender against a loss in the event of a foreclosure and deficiency
B. Process in which property is taken by a creditor for nonpayment of debt secured by real property.
C. any fact that is important or relevant to the issue at hand; mandatory disclosure by all agents in a transaction to all parties of the transaction
D. A map of a subdivision indicating the location and boundaries of individual properties. Generally shows lots, blocks, easements, streets, floodplains, etc. Usually requires official
approval before recordation.
29. General lien
A. When an improvement or any portion of an improvement, such as a building, a fence, or a driveway illegally extends beyond the land of its owner and covers some land of an adjoining
owner/street/alley.
B. A reference to a publicly recorded document, usually an earlier deed. The referenced document typically contains a legal description of the property.
C. Department of Housing and Urban Development. Enforces the Federal Fair Housing Act.
D. This type of lien affects all the property of a debtor, both real and personal, rather than a specific parcel of real property
30. Easement by necessity
A. an estate that arises when a tenant who lawfully came into possession of real property continues, after the tenant's rights have expired, to hold possession of the premises without the
consent of the landlord; lowest estate in real estate.
B. AKA easement by implication of law, because all owners must have rights of ingress to and egress from their land.
, C. The state's inherent authority to create and adopt regulations necessary to protect the public health, safety and general welfare of the citizenry.
D. This type of lien affects all the property of a debtor, both real and personal, rather than a specific parcel of real property
31. baseboards
A. a board around the bottom of a wall perpendicular to the floor; covers gap b/w the floor and wall; decorative
B. the right of a borrower in default on a mortgage loan to reclaim the forfeited property prior to the foreclosure sale through payment in full of all debt and associated costs.
C. The form of foreclosure used in a title theory state; also called a nonjudicial foreclosure.
D. Instrument made by a property owner to convey title to real and personal property on the owner's death
32. Federal Emergency Management Agency (FEMA)
A. a loan in which the monthly payments increase annually, with the increased amount being used to reduce directly the principal balance outstanding and thus shorten the overall term of
the loan.
B. NC version of the federal E-sign legislations that allows contracts to be created by electronic means such as e-mails and faxes; the electronic signature is binding.
C. This means that the contract must be performed within the time limit specified, and any party who has not performed on time is liable for breach of contract.
D. Agency responsible for designating flood hazard areas bordering rivers and streams.
33. slab
A. A mandatory agency information brochure that a licensee must give to and review with consumers in all real estate sales transactions no later than first substantial contact; it does not
create agency.
B. The form of foreclosure used in a title theory state; also called a nonjudicial foreclosure.
C. a flat, horizontal reinforced concrete area, usually the interior floor of a building but also an exterior or a roof area
D. A detailed cash accounting of a real estate transaction showing all cash received, all charges and credits made, and all cash paid out in the transaction.
34. Cost Approach
A. the process of estimating the value of a property by adding the appraiser's estimate of the reproduction or replacement cost of the building, less depreciation to the estimated land
value.
B. The ownership of real property by only one person or entity; referred to as closing.
C. A loan in which principal as well as interest is payable in periodic installments over the term of the loan.
D. a flat, horizontal reinforced concrete area, usually the interior floor of a building but also an exterior or a roof area
35. lease
A. the extra thick framing over doors and windows to bear the weight of the building above the opening
B. Used to guarantee a broker a commission if that particular property is sold to a specific buyer.
C. a conveyance from a landlord (an owner of real estate), to a tenant that transfers the right of possession and use of the owner's property for a specified period of time.
D. Owned by two or more parties usually not husband and wife; undivided equal interest unless stated; each owner receives share when sold can transfer without other signing; can
acquire at different times; if not stated, tenants in common; never survivorship
36. floor joists
A. a horizontal board laid on edge, resting on the beams that provide the main support for the floor.
B. a column, usually of masonry block or steel-reinforced concrete; bears wall weight.
C. Areas outside incorporated limits that are subject to the zoning restrictions of a municipality
D. the overhand of a sloping roof that extends beyond the walls of the house.
37. Real Property
A. Passed in 1980, established Superfund to clean up uncontrolled hazardous waste site and to respond to spills
B. defined as the land, everything that is permanently attached to the land (or goes with) the land
C. used when a transaction is an in-house sale (when one agent from firm X represents the buyer and another agent from firm X represents the seller)
D. A comparison of the prices of recently sold homes that are similar to a listing seller's home in terms of location, style, and amenities; an estimate of market value.
38. Self-help eviction
A. a person who retains possession of leased property after the lease has expired; the landlord may continue to accept rent or start eviction procedures.
B. Illegal eviction practices used by landlords instead of lawful use of summary ejectment.
C. the only legal way a landlord can evict a tenant; through a hearing before a magistrate in small claims court.
D. A defect on a deed that is frequently cured by a quitclaim deed.
39. statute of limitations
A. rights arising from the contract itself
B. An easement acquired for a public purpose through the power of eminent domain.
C. The law pertaining to the period of time within which certain actions must be brought to court or be lost.
D. The principle that states that excess profits generate competition.
40. NC Sediment Pollution Control Act
A. Due and payable by the buyer/principal on the signing and acceptance of an offer to purchase property found by the buyer's agent.
B. created to handle problems that occur as a result of sedimentation in state waters
C. A listing agreement under which the broker's commission is contingent on the broker personally producing a ready, willing, and able buyer before the property is sold by the seller or
another broker.
D. an agreement b/w property owner and possible buyer, secured by the payment of an option fee, to buy or not to buy property within a specific time period at negotiated terms.
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