Yha - Unit 04 Quiz (Chapters 10 & 11)

50 Questions | Total Attempts: 8193

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Course Quizzes & Trivia

90-Hour Broker Pre-License Course Quizzes


Questions and Answers
  • 1. 
    The legal proceeding or legal action brought by either the buyer or the seller under a purchase contract to enforce the terms of the contract is known as
    • A. 

      An injunction.

    • B. 

      A lis pendens.

    • C. 

      An atttachment.

    • D. 

      A suit for a specific performance.

  • 2. 
    If, upon the receipt of an offer to purchase his property under certain conditions, the seller makes a counteroffer, the prospective buyer is
    • A. 

      Bound by his original offer.

    • B. 

      Bound to accept the counteroffer.

    • C. 

      Bound to whichever offer is lower.

    • D. 

      Relieved of his original offer.

  • 3. 
    The amount of earnest money deposit is determined by
    • A. 

      The real estate licensing statutes.

    • B. 

      An agreement between the parties.

    • C. 

      The broker's office policy on such matters.

    • D. 

      The mandatory IRS minimum of 5 percent of the purchase price.

  • 4. 
    Which of the following gives the best evidence of the buyer's intention to carry out the terms of the real estate purchase contract?
    • A. 

      The "subject to" clause

    • B. 

      The agreement to seek mortgage financing

    • C. 

      The earnest money deposit

    • D. 

      The provision that "time is of the essence"

  • 5. 
    An option
    • A. 

      Requires the optionee to complete the purchase.

    • B. 

      Gives the optionee an easement on the property.

    • C. 

      Keeps an offer open for a specified time.

    • D. 

      Makes the seller liable for a commission.

  • 6. 
    When a prospective buyer makes a written purchase offer that the seller accepts, then the
    • A. 

      Buyer may take possession of the real estate.

    • B. 

      Seller grants the buyer ownership rights.

    • C. 

      Buyer receives legal title to the property.

    • D. 

      Buyer receives equitable title to the property.

  • 7. 
    A broker arrives to present a purchase offer to the seller, an elderly invalid, and finds her ex-husband also present. In the presence of the broker, the ex-husband persistently urges the seller to accept the offer, even though it is much lower than the price she has been asking for her home. If the seller accepts the offer, she may later claim that
    • A. 

      The broker should not have brought her such a low offer for her property.

    • B. 

      She was under undue duress from her former husband, and therefore, the contract is void.

    • C. 

      The broker defrauded her by allowing her ex-husband to see the purchase offer.

    • D. 

      Her consumer protection rights have been usurped by her former husband.

  • 8. 
    Which of the following best describes earnest money?
    • A. 

      The consideration for the sale of the property

    • B. 

      The money put up by the buyer at the time the offer is made

    • C. 

      The commission to be paid to the broker

    • D. 

      The money to be used for paying for some of the closing costs

  • 9. 
    Money that serves to compensate a seller in the event a buyer defaults is known as
    • A. 

      Actual damages.

    • B. 

      Escrow.

    • C. 

      Earnest money.

    • D. 

      Liquidated damages.

  • 10. 
    To assign a contract for the sale of real estate means to
    • A. 

      Record the contract with the county recorder's office.

    • B. 

      Permit another broker to act as agent for the principal.

    • C. 

      Transfer one's rights under the contract.

    • D. 

      Allow the seller and the buyer to exchange positions.

  • 11. 
    The Illinois court decision in Chicago Bar Association et al. v. Quinlan and Tyson, Inc. held that
    • A. 

      Licensees have no duty to search for undisclosed latent material defects in a property.

    • B. 

      Real estate licensees may complete preprinted forms, but they may not draft legal documents.

    • C. 

      Multiple-listing services may not establish commission rates.

    • D. 

      A broker may not pay a commission to another broker.

  • 12. 
    Two salespeople working for the same broker obtained offers on a property listed with their firm. The first offer was obtained early in the day. A second offer for a higher purchase price was obtained later in the afternoon. The broker presented the first offer to the seller that evening. The broker did not inform the seller about the second offer so that the seller could make a decision about the first offer. Which of the following is true?
    • A. 

      The broker's actions are permissible provided the commission is split between the two salespeople.

    • B. 

      After the first offer was received the broker should have told the salespeople that no additional offers would be accepted until the seller decided on the offer.

    • C. 

      The broker has no authority to withhold any offers from the seller.

    • D. 

      The broker was smart to protect the seller from getting into a negotiating battle over the two offers.

  • 13. 
    On Monday the seller offers to sell a vacant lot to the buyer for $112,000. On Tuesday, the buyer counteroffers to buy for $110,500. On Friday the buyer withdraws the counteroffer and accepts the original offer of $112,000. Under these conditions
    • A. 

      There is a valid agreement because the buyer accepted the seller's offer exactly as it was made.

    • B. 

      There is not a valid agreement because the buyer's counteroffer was a rejection of the seller's offer and, once it was rejected, it cannot be accepted later.

    • C. 

      There is a valid agreement because the buyer accpted before the seller advised the buyer that the offer is withdrawn.

    • D. 

      There is not a valid agreement because the seller's offer was not accepted within 72 hours.

  • 14. 
    At the time a buyer was negotiating the purchase of a lot on which to build a new home, the seller represented that the soil was firm enough to support the contruction of a building. In fact, the seller knew that any new construction would very likely sink up to fifteen feet below the surface. This contract is
    • A. 

      Void because of fraud.

    • B. 

      Voidable by the buyer because of fraud.

    • C. 

      Voidable by the seller because of the mistake.

    • D. 

      Voidable by neither party because no harm was done yet.

  • 15. 
    After the buyer and seller have signed a sales contract, the seller has a change of heart and defaults. The buyer sues the seller. Is this action legal?
    • A. 

      Yes. The buyer can sue for specific performance.

    • B. 

      Yes. According to the statute of frauds, the buyer can sue.

    • C. 

      No. Only the broker would have the right to sue the seller.

    • D. 

      No. The buyer cannot sue the seller under any circumstances.

  • 16. 
    The concept that requires that an injured party bring an action within a specific period of time after the injury is
    • A. 

      A variance.

    • B. 

      The statute of limitations.

    • C. 

      The statute of fraud.

    • D. 

      Waiver.

  • 17. 
    A real estate sales contract becomes valid or in effect when it has been signed by
    • A. 

      Only the buyer.

    • B. 

      The buyer and seller.

    • C. 

      Only the seller.

    • D. 

      The broker and the buyer.

  • 18. 
    The party to whom an offer is being made (the offeree) has the right to
    • A. 

      Reject the offer.

    • B. 

      Revoke the offer.

    • C. 

      Rescind the offer.

    • D. 

      Release the offer.

  • 19. 
    Which statement best describes a contract that is voidable?
    • A. 

      The contract has no legal effect.

    • B. 

      The contract is oral.

    • C. 

      The contract may be declared void.

    • D. 

      The contract has not been signed.

  • 20. 
    At what age is an Illinois resident considered to be of legal age?
    • A. 

      16

    • B. 

      18

    • C. 

      21

    • D. 

      24

  • 21. 
    In Illinois, a deed or contract executed on a Sunday or legal holiday is
    • A. 

      Void.

    • B. 

      Invalid.

    • C. 

      Voidable and unenforceable.

    • D. 

      Valid and enforceable.

  • 22. 
    A broker is about to present a written contract to a client. The contract is intended to become a binding real estate contract as soon as the client signs it. How must the contract be headed, under Illinois law?
    • A. 

      Binding real estate contract

    • B. 

      Real estate sale contract

    • C. 

      Contract

    • D. 

      Offer to purchase.

  • 23. 
    A buyer and a seller sign a binding sales agreement. Three days before closing, the property is destroyed by a tornado. Under Illinois law, which of the following is true?
    • A. 

      The buyer bears the risk of loss under the common law and must complete the transaction.

    • B. 

      The seller cannot enforce the contract and must return all earnest money to the buyer.

    • C. 

      If the buyer has possession of the property, the buyer is not required to pay the full contract price.

    • D. 

      Once a seller has accepted an offer, the seller is no longer liable for any damages to the subject property.

  • 24. 
    When properly recorded in the county where the real estate of the defendant is located, a judgment becomes
    • A. 

      A voluntary lien.

    • B. 

      An involuntary lien.

    • C. 

      A specific lien.

    • D. 

      A juried lien.

  • 25. 
    When a company furnishes materials for the contruction of a house and is subsequently not paid, it may file
    • A. 

      A deficiency judgment.

    • B. 

      A lis pendens.

    • C. 

      An estoppel certificate.

    • D. 

      A mechanic's lien.

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