Real Estate Practice: Midterm

31 Questions | Total Attempts: 294

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Real Estate Practice: Midterm - Quiz

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Questions and Answers
  • 1. 
    An option on real estate is which of the following? 
    • A. 

      A deposit

    • B. 

      A consideration

    • C. 

      A contract

    • D. 

      An endorsement

  • 2. 
    In the absence of specific contractual provisions to the contrary, if a seller defaults on a sales contract, the buyer may do which of the following? I. Sue the seller II. Cancel the contract and retrieve any earnest money deposited. 
    • A. 

      I only

    • B. 

      II only

    • C. 

      Both I and II

    • D. 

      Neither I or II

  • 3. 
    The term contractual ability refers to which of the following?  
    • A. 

      The competence of the parties to a contract.

    • B. 

      An agreement about terms between the parties to a contract.

    • C. 

      The legality of the purpose of a contractual agreement.

    • D. 

      The inclusion in a contract of all necessary clauses and convenants.

  • 4. 
    If a broker is to receive a fee of 7% of the actual sales price of a house, how much less will he earn if the seller reduces the $63,000 price by $5,000. 
    • A. 

      $175

    • B. 

      $260

    • C. 

      $350

    • D. 

      $700

  • 5. 
    A seller wishes to net $8,590 from the sale of her property. If her broker is to receive a fee of 4% of the selling price and an allowance of $50 for expenses, what must the minimum selling price be. 
    • A. 

      $8,884

    • B. 

      $8,896

    • C. 

      $8,984

    • D. 

      $9,000

  • 6. 
     The lender of a mortgage money is known as which of the following?
    • A. 

      Mortgageee

    • B. 

      Mortgagor

    • C. 

      Trustee

    • D. 

      Lessee

  • 7. 
    When a mortgage loan requires periodic payments that will not fully amortize the amount of the loan by the final due date, the final payment is called 
    • A. 

      Release payment

    • B. 

      Balloon payment

    • C. 

      Level payment

    • D. 

      Acceleration payment

  • 8. 
    A mortgage that covers a number of parcels of real property and that may provide for the release of each parcel as certain payments are made to reduce the loan is called: 
    • A. 

      Blanket mortgage

    • B. 

      Open-end mortgage

    • C. 

      Wrap-around mortgage

    • D. 

      Partially amortized mortgage

  • 9. 
    Written evidence of a promise to repay borrowed money is called: 
    • A. 

      Abstract

    • B. 

      Acknowledgement

    • C. 

      Convenant

    • D. 

      Note

  • 10. 
     Funds for the Federal Housing Administration (FHA) loans are provided by:
    • A. 

      Qualified lending institutions

    • B. 

      Any government agency

    • C. 

      Federal Housing Administration (FHA) only

    • D. 

      Federal Deposit Insurance Company only

  • 11. 
    A conventional mortgage is best defined as: 
    • A. 

      FHA-insured mortgage

    • B. 

      VA-insured mortgage

    • C. 

      Non-insured bank mortgage

    • D. 

      Installment land contract

  • 12. 
    A veteran who receives a Veterans Administration (VA) loan on a property is permitted to do which of the following? I. Sell the property and transfer the loan to a new property II. Sell the property to a non-veteran who may then assume the balance of the loan  
    • A. 

      I only

    • B. 

      II only

    • C. 

      Both I and II

    • D. 

      Neither I or II

  • 13. 
    During one year, a man paid an average of $126 a month on interest on his loan. If he was in the 28 percent income tax bracket and all the interest for that year was deductible from his taxable income, approximately how much less was his income tax bill as a result of this deduction? 
    • A. 

      $35

    • B. 

      $42

    • C. 

      $353

    • D. 

      $423

  • 14. 
    Sherwood Estates is a suburban development of large, new houses. After one of the houses was bought by a religious group and turned into a commune, two realty firms sensing the possibility of quick profits, telephoned owners of the houses in the block where the group located, told them of the recent establishment of the commune and solicited listings. Under the Federal Fair Housing Act, the realty firms' solicitation of owners is:
    • A. 

      Not prohibited

    • B. 

      Unlawful panic-peddling

    • C. 

      Unlawful discrimination

    • D. 

      Unlawful intimidation

  • 15. 
    In allegations of discriminatory practices under the Federal Fair Housing Act, the burden of proof is on the: 
    • A. 

      Court

    • B. 

      Defendant

    • C. 

      Complainant

    • D. 

      Department of Housing and Urban Development

  • 16. 
    Under the guidelines set up by the Federal Fair Housing Act, a veteran who is trying to rent a house through a broker has been discriminated against. When he files a complaint with the Department of Housing and Urban Development, that agency can do which of the following under this Act? I. Fine the broker II. Bar the broker from participating in both FHA and VA programs
    • A. 

      I only

    • B. 

      II only

    • C. 

      Both I and II

    • D. 

      Neither I or II

  • 17. 
    An individual who engages another to act for him under a contractual agreement is referred to as:  
    • A. 

      Principal

    • B. 

      Grantor

    • C. 

      Agent

    • D. 

      Testator

  • 18. 
    An agency relationship typically exists between which of the following?   
    • A. 

      Seller and buyer

    • B. 

      Seller and broker

    • C. 

      Borrower and lender

    • D. 

      Lender and seller

  • 19. 
     Broker Owens enters into a listing agreement to sell Ms. Allen's house. All of the following statements are true, EXCEPT:  
    • A. 

      When Broker Owens' salesperson, Mark King, shows Ms. Allen's property, he is a representative of Ms. Allen.

    • B. 

      Ms. Allen may terminate for cause the listing agreement with Broker Owens prior to the agreement's ending date.

    • C. 

      When Broker Owen's shows the house to prospective buyer Steve Smith, he is now an agent of Mr. Smith.

    • D. 

      If the listing agreement provides Broker Owens to invest money to improve Ms. Allen's residence, this is called agency coupled with an interest.

  • 20. 
     If a salesperson is told by a seller that the listed property has a leaky roof and termites, the salesperson must do which of the following: I. Inform a prospective buyer of these conditions. II. Require that the roof be repaired and the termites be exterminated before selling the property.
    • A. 

      I only

    • B. 

      II only

    • C. 

      Both I and II

    • D. 

      Neither I or II

  • 21. 
    A fiduciary relationship between a listing broker and seller terminates if the seller does which of the following? I. Withdraws the property from the market and formerly terminates the listing agreement. II. Requests that the listing be placed in the multiple listing book.
    • A. 

      I only

    • B. 

      II only

    • C. 

      Both I and II

    • D. 

      Neither I or II

  • 22. 
    When handling an exclusive right to sell listing, a broker is responsible for doing which of the following: I. Guaranteeing to buy the property himself if it is not sold within the listing period. II. Screening offers and refusing those that are below listed price.
    • A. 

      I only

    • B. 

      II only

    • C. 

      Both I and II

    • D. 

      Neither I or II

  • 23. 
     Which of the following types of listing agreements gives the broker the greatest assurance of receiving a commission.  
    • A. 

      Net listing

    • B. 

      Exclusive agency listing

    • C. 

      Exclusive right to sell listing

    • D. 

      Open listing

  • 24. 
    Which of the following statements about listings are true? I. A listing may be terminated by mutual consent of both parties. II. An owner may not enter into a listing contract with more than two brokers at any one time. 
    • A. 

      I only

    • B. 

      II only

    • C. 

      Both I and II

    • D. 

      Neither I or II

  • 25. 
     The term quieting a title refers to:
    • A. 

      A title insurance company's search of a title.

    • B. 

      A mortgagor's relinquishing title after foreclosure.

    • C. 

      The deposit of title with an escrow agent.

    • D. 

      The removal of a cloud on a title by court action.

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