Texas Real Estate Test |Questions and 100%
Correct Answers
In 1939, the first regulation for real estate was passed, called - Answer Texas Real Estate
Dealers Act
The act was renamed The Real Estate License Act in 1955
The purpose of the US Constitution and the individual state constitutions is - Answer to
establish the rights of the citizens of the United States, and to outline the limits of
government.
-The Fifth Amendment to the Constitution is particularly applicable to property rights
where it guarantees that a citizen will not be deprived of property
-The Fourteenth Amendment which was written and adopted to address citizenship of
former slaves after the Civil War, also allowed for Congress to pass the federal fair
housing legislation under its civil rights protections. The 14th Amendment applies the
5th Amendment guarantees to the states as well as federal law.
An ordinance is - Answer legislation that is passed by a local municipality and binding on
the citizens of that municipality. As they say with a variety of policies, 'all real estate is
local.
Here are some sample zoning ordinances from around the state of Texas:
City of Dallas
City of Austin
City of El Paso
City of Waco
City of Brownsville
City of Houston
,Legal Remedies (Courts of Law) vs. Equitable Remedies (Courts of Equity) - Answer
Because some remedies in common law were considered too harsh, courts of equity
were created to provide relief to applicants under equitable principles
equity has the ability or flexibility to do what is considered fair and equal, even when
the letter of the law would dictate otherwise. Federal bankruptcy courts traditionally
operated as courts of equity.
Fair Housing Act - Answer it is unlawful to discriminate on the basis of race, color,
religion, sex, handicap, familial status, or national origin. Legislation that is virtually
identical to the federal act. At the state level, the Texas Workforce Commission Civil
Rights Division administers and enforces the TFHA
Capital Gains Tax Law - Answer
Equal Credit Opportunity Act (ECOA) - Answer is administered by the Consumer
Financial Protection Bureau (CFPB). This law was enacted in 1974 and makes it unlawful
for any creditor to discriminate against any applicant, with respect to any aspect of a
credit transaction, on the basis of race, color, religion, national origin, sex, marital
status, or age (provided the applicant has the capacity to contract); to the fact that all or
part of the applicant's income derives from a public assistance program; or to the fact
that the applicant has in good faith exercised any right under the Consumer Credit
Protection Act.
If a financial institution fails to comply they can be subject to civil liability for actual and
punitive damages in individual or class actions. Liability for punitive damages can be as
much as $10,000 in individual actions and the lesser of $500,000 or 1% of the creditor's
net worth in class actions
Real Estate Settlement Procedures Act (RESPA) - Answer is also administered by the
CFPB, and was designed to ensure that buyers and sellers in residential real estate
transactions involving a new first mortgage loan have knowledge of all of the closing
costs.
,Professional Organizations - Answer is usually a not-for-profit organization that seeks to
further a particular profession and the interests of individuals engaged in that
profession
National Association of Realtors (NAR) - Answer further a particular profession and the
interests of individuals engaged in that profession.
By far the largest and most well-known voluntary trade association for real estate sales
agents and brokers is the National Association of REALTORS®, which was founded in
1908. This is definitely a trade group, maintained for members' and their interests, and
not so much for consumers, although they do provide limited information in that regard.
Market Value and Market Price - Answer The market value of a property is the amount
the property, in its current state, should sell for on the open market. The market price is
the price that a property actually sells for.
Assessed Value - Answer is the value established for tax purposes by local municipalities.
Commonly related to the market value and is often a percentage of market value.
Estimated Sales Value - Answer is found by examining the sale price of comparable
properties in the same area that recently sold. Approximation of the sale price for that
property that can be expected at that time in that market and often is the same as the
assessed value.
Investment Value - Answer is the value of the property to a particular investor using that
investor's qualifications of what adds or subtracts value.
Replacement Value - Answer is the amount of money that would be required to
completely replace a particular structure or building.
, Liquidation Value - Answer is an estimate of the amount of money that could be gained
if the property was quickly sold in a low-demand market. The liquidation value becomes
relevant if the property has to be auctioned or is being sold after foreclosure.
Broker - Answer a person who, in exchange for a commission or other valuable
consideration or with the expectation of receiving a commission or other valuable
consideration, performs for another person one of the following acts, including helping
another person to conduct a real estate transaction
TRELA - Answer The Real Estate License Act (TRELA), a broker is the agent for the buyer
or the seller, or in some cases, both parties, in negotiating the sale, purchase, or renting
of property. A broker is authorized to operate a real estate brokerage (business).
Sales Agent - Answer is a licensee employed by or associated with a broker, who
conducts brokerage activities on behalf of the broker in return for a fee or a
commission. They perform real estate transactions under the ultimate supervision of
the broker.
ESAC - Answer Education Standard Advisory Committee
The function is to regularly review and revise curriculum standards, course content
requirements and instructor certification requirements for core and MCE courses.
-Committee consists of 12 members
-Seven members who have been engaged in the practice of real estate
-Four members who are real estate instructors or owners of real estate
-One member who represents the public
Economic Characteristics of Land - Answer -Scarcity
-Modification
-Fixity, and
-Situs.
