Exam (elaborations)
ROCKWELL CRAM EXAM 3 QUESTIONS AND ANSWERS
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ROCKWELL CRAM EXAM 3 QUESTIONS AND ANSWERS
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Name: Score:70 Multiple choice questions
Term 1 of 70
What information does an appraiser need in order to calculate a capitalization rate?
Value and net income
Price and gross income
Price and net income
Value and gross income
Term 2 of 70
A homeless shelter, which contains a number of units for different families, is owned by a
religious group. The religious group's leaders instruct the shelter's manager to limit occupancy
only to individuals who are of their faith. This would be permissible under which of the
following circumstances?
It will increase, in anticipation of the changing uses
Subtract $800 from the sales price of the comparable property
Check the public records to see who owns the property
Membership in the religious organization is not restricted on the basis of race, color, or
national origin
Term 3 of 70
Which of the following statements about prepayment penalties is true?
Both fha and va loans have no restrictions on prepayment penalties
Va loans impose strict prepayment penalties
Fha loans allow prepayment penalties under certain conditions
Neither the FHA nor VA loan programs allow prepayment penalties
,Term 4 of 70
Mineral rights associated with real property are always:
only transferable with the property title
separable and divisible (Mineral rights may be sold separate but are considered
appurtenant and run with the land)
always included in the sale of the property
non-transferable under any circumstances
Term 5 of 70
Which of the following actions by a developer would require a zoning variance or a rezone,
because it would result in a more intensive use of the land?
Establishing a community garden on the property
Reduction in building height restrictions
Increase in number of lots per acre
Change from residential to commercial zoning
Term 6 of 70
Chris, a real estate agent, met with Zach, a property owner, to discuss listing the property. Zach
told Chris that he was illiterate and that he needed Chris to read the listing agreement to him.
Chris did so, plus he spent a long time explaining the various terms and answering Zach's
questions. Zach agreed to everything, and signed the agreement with an "X." The listing
agreement is:
valid, because Zach was illiterate, not mentally incompetent
the listing belongs to the firm, and will remain with firm a
honesty (honesty and good faith is owed to all parties)
only if his designated broker allows it
,Term 7 of 70
A purchase and sale agreement is for $150,000, with 80% financing, closing in 30 days with
possession at closing, and a rent provision for possession after closing. This is an example of
a/an:
contract with contingencies (specifically financing contingencies ie 80% financing)
a lease agreement with no contingencies
an option to purchase agreement
a verbal agreement without any formal documentation
Term 8 of 70
Which of the following situations would cause prices for residential real estate to go up in a
particular area?
A rise in crime rates leading to neighborhood decline
A large new factory that will employ thousands
A decrease in local school funding affecting education quality
A significant increase in property taxes in the area
Term 9 of 70
When homes in a new development are sold, a $2,000 fee is charged to the buyers. This fee
covers the homeowners association dues for the first year. HOA dues for each subsequent
year are $1,000. In the development's first year, ten homes are sold. Ten more are sold the
second year. Assuming that the HOA's account had no disbursements or expenses (and
ignoring any possible contributions from the developer), what is the balance of the account
after two years?
$50,000
$100,000
$2,500
$25,000
, Term 10 of 70
An apartment building is right where a new city park is going to be built. The city condemns it.
Can the city terminate the leases of the building's tenants?
Yes
No
Term 11 of 70
The comparable has a two-car garage and the subject property only has a one-car garage.
The appraiser estimates that space for a second car contributes about $800 to the value of a
home. To take this into account, the appraiser will:
subtract $800 from the sales price of the comparable property
estimate the garage space as worth $1,200 instead
add $800 to the value of the subject property
ignore the garage difference in the appraisal
Term 12 of 70
ABC Realty signed a property management agreement to manage property for XYZ
Apartment Rentals. Do they have an agency agreement and, if so, what kind of agency
authority has been created?
No; there is no agency agreement since it's a management contract
No; the agreement only allows for limited agency authority
Yes; ABC has been hired by XYZ to be a general agent
Yes; abc is a special agent for xyz
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