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Modern Real Estate Quiz 200 review questions and AnswerKey
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Modern Real Estate Quiz 200 review questions and AnswerKey
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Modern Real Estate QuizCircle the letter of the Answer that corresponds to the displayed Question.
1. Excise Tax
A. AKA the market data approach. When an estimate of value is obtained by comparing the subject property with
recently sold comparable properties.
B. Areas designated by FEMA as being prone to flooding.
C. A tax that is based on the sales price of the property.
D. A declaration of limitations established by a developer.
2. Adverse Possession
A. The purpose of a legally enforceable contract cannot be for illegal actions or acts against public policy.
B. An attempt by the offeree to change any of the terms proposed by the offeror
C. The Open, Continuous, Exclusive, Adverse, Notorious possession of another's land under a claim of title. Possession
for a statutory period of 20 years in North Carolina may be a means of acquiring title.
D. Loss not covered by the insurer.
3. Competition
A. The country's central banking system, which controls the nation's monetary policy by regulating the supply of money
and interest rates
B. The principle that states that excess profits generate competition.
C. Water that exists under earth's surface in tiny spaces or crevices in geological formations; if contaminated, threatens
source of clean drinking water
D. The form of foreclosure used in a title theory state; also called a nonjudicial foreclosure.
4. Deed of gift
A. Areas outside incorporated limits that are subject to the zoning restrictions of a municipality
B. Deed used when a grantor conveys property as a gift; must be recorded within two years or it becomes void.
C. the masonry or concrete wall below ground level that serves as the main support for the frame structure; form the
side walls of the basement or crawlspace.
D. 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.
5. Deductible
A. the owner's initial cost for the real estate including closing expenses
B. For the life of another. A life estate pur autre vie is a life estate that is measured by the life of a person other than the
grantee.
C. Federal law that prohibits discrimination based on familial status, race, sex, handicap, color, religion, national origin.
(FRESH CORN)
D. Loss not covered by the insurer.
6. 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. Agency responsible for designating flood hazard areas bordering rivers and streams.
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. 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
7. Express Agreement/Contract
A. a deed used to release a parcel of property from a mortgage or deed of trust lien when the real estate loan has been
paid in full.
B. Scarcity, Location, Improvements, & Permanence of investment. aka SLIP
C. the exact way of describing real estate in a contract, deed, mortgage or another document.
D. An oral or written contract in which the parties state the contract's terms and express their intentions in words.
8. Bundle of Legal Rights
A. Lien that is attached to real property as of the listing date.
B. the bottom of the wall frame that connects the studs to the flooring
C. An improper use or abuse of a property by a possessor who holds less than fee ownership, such as a tenant, life
tenant, mortgagor, or vendee. Such waste ordinarily impairs the value of the land.
D. The concept of land ownership that includes ownership of all legal rights to the land, i.e.. Disposition, exclusion,
enjoyment, possession and control.
9. Novation
A. a heavy wooden or steel beam supporting the floor joists and providing the main horizontal support for the floor
B. story-high space below the first floor; floor is usually concrete slab
C. Substituting a new contract for an old one or substituting new parties to an existing contract.
D. A tenant's right to occupy real estate during the term of a lease, generally considered a personal property interest;
nonfreehold estate.
10. 3 events in closing
A. 1)the promises made in the sales contract are fulfilled 2)the mortgage loans funds are distributed to the buyer for use
3)other settlement costs or funds are dispersed
B. A zone created to preserve historic buildings and sites that are irreplaceable.
C. When a person dies without having left a will.
D. Loss not covered by the insurer.
11. Encumbrance
A. systems to limit the source of environmental hazards and reduce their effect on humans and the surrounding
environment
B. A landowner's claim to use water in large navigable lakes and oceans adjacent to the property. The ownership rights
to land bordering these bodies of water up to the average high-water mark.
C. money borrowed
D. A claim, charge, or liability that attaches to and is binding on real estate.
12. Voidable Contract
, A. Law that requires those engaged in the interstate sale or leasing of subdivision lots to file a statement of record and
register the details of the land with HUD
B. 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.
C. A contract that seems to be valid on the surface but may be rejected or disaffirmed by one or both of the parties.
D. A conveyance that carries the warranty that the property was unencumbered by the grantor.
13. North Carolina Condominium Act of 1986
A. Specifies that a condo is created and established when the developer executes and records a declaration of its
creation in the county where the property is located
B. A legally enforceable promise or set of promises between legally competent parties.
C. Generated by movement of electrical currents; prolonged exposure may cause cancer; major concern for property
owners near high voltage line
D. one who is employed by a person already acting as an agent (and agent of the agent).
14. Trustee's Deed
A. a mortgage loan on approved property made to a qualified veteran by an authorized lender and guaranteed by the
Dept. of Veterans Affairs to limit the lender's possible loss.
B. Enabling Act
C. The home is owned by an individual (not 3 or more/not sell more than 1 every 2 years.
D. A deed of conveyance executed by a trustee and generally used to transfer title after a foreclosure action.
15. mitigation
A. Special taxes levied on real estate for public improvements made to that real estate, such as sidewalks, street
lighting.
B. A survey that shows the lay of the land.
C. systems to limit the source of environmental hazards and reduce their effect on humans and the surrounding
environment
D. Permission obtained from zoning authorities to build a structure or conduct a use that is expressly prohibited by the
current zoning laws.
16. Master Plan
A. The primary method by which local governments recognize development goals.
B. An appraisal principle that states that the maximum value of a property tends to be set by the cost of purchasing an
equally desirable and valuable substitute property, assuming that no costly delay is encountered in making the
substitution.
C. IRS
D. also called a "term loan", it only calls for periodic payments of interest.
17. Quick Take
A. An appraisal principle that states that the maximum value of a property tends to be set by the cost of purchasing an
equally desirable and valuable substitute property, assuming that no costly delay is encountered in making the
substitution.
B. federal law giving consumers the right to view and correct their credit information
C. Any right to occupy a unit of real property during five or more separated time periods over a period of at least five
years. 5 day cancellation (without penalty) 10 days developer keeps money in trust; 30 days to refund; $500 fine to
developer
D. A method of condemnation in which title and possession of private property can immediately be transferred to a public
authority.
, 18. growing-equity mortgage (GEM)
A. the top part of the wall framing that connects the stud to the ceiling framing
B. a horizontal board laid on edge, resting on the beams that provide the main support for the floor.
C. A person in possession of a life estate.
D. 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.
19. Straight Line Depreciation
A. When the cost of an asset is depreciated evenly over its useful life.
B. A tax that is based on the sales price of the property.
C. federal law that ensures that residential buyers and sellers receive full disclosure of all settlement charges; mandates
HUD booklet about closing costs, a good-faith estimate of closing costs, and hUD-1 closing statement.
D. A reference to a publicly recorded document, usually an earlier deed. The referenced document typically contains a
legal description of the property.
20. General lien
A. 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.
B. This type of lien affects all the property of a debtor, both real and personal, rather than a specific parcel of real
property
C. Refers to a transfer of rights or duties under a contract to a third party.
D. Federal law that prohibits discrimination based on familial status, race, sex, handicap, color, religion, national origin.
(FRESH CORN)
21. Mutual assent
A. A deliberate agreement between parties offer and acceptance; "meeting of the minds." A requirement of a legally
enforceable contract.
B. profits from assets owned longer than 12 months; taxed at a lower rate than ordinary income
C. Arrangement where consumer asks licensee to perform specific real estate services for a set fee; unbundling of
services; limited service firms.
D. A loan made to a borrower with a credit rating below what is required for regular loans creating greater liability for the
lender that is countered by higher interest rates and fees; called B, C, or D paper.
22. NC Coastal Area Management Act
A. a loan that is not backed by a gov't agency.; lender bears all the risk in the event of default
B. a charge for the use of borrowed money
C. In North Carolina, a fixture attached to leased property by a tenant farmer is considered the landowner's real property
rather than the tenant's personal property.
D. law designed to protect, preserve, and give management guidelines in coastal areas of the state and places a severe
limitation on developments
23. Income capitalization approach to value
A. when a land owner leases land to a tenant who agrees to erect a building on the land.
B. A contract that seems to be valid on the surface but may be rejected or disaffirmed by one or both of the parties.
C. 10 day period after the auction in which the borrower can try to raise the necessary funds to redeem the property.
D. Estimate based on the present worth of the future rights to income.
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