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National - Real Estate Exam Practice Questions
(Set One)
Which of the following is a lien on real estate? a. recorded easement b. recorded mortgage c. encroachment d. dead restriction - b. recorded mortgage Which approach to value would MOST likely be useful to real estate brokers estimating the value of a single-family residence for sale in a subdivision? a. cost approach b. income approach c. market comparison approach d. gross rent multiplier - c. market comparison approach A license is an example of? a. easement b. encumbrance c. condemnation d. police power - b. encumbrance If the holder of an easement owns adjacent land and his physical use of the land is benefited by the easement, he is said to have: a. easement in gross
b. prescriptive easement c. easement appurtenant d. license - c. easement appurtenant A sales contract was signed by a minor. Which term describes this contract? a. voidable b. breached c. discharged d. void - a. voidable A real estate broker hired by an owner to sell a parcel of real property must comply with? a. any and all instructions of the owner b. any and all instructions of the buyer c. concept of caveat emptor d. law of agency - d. law of agency Which of the following could always be found by searching the county land records? a. encroachments b. rights of parties in possession c. inaccurate surveys d. mechanics' liens - d. mechanics' liens An ordinary life estate? a. cannot be sold b. greatest estate in real property
a. wraparound b. accelerated c. balloon d. variable - c. balloon You can convey real property to? a. drunkard, a narcotics addict, a minor b. corporation, mentally incompetent person c. both of the above d. neither of the above - c. both of the above If a borrower computed the interest charged for the previous month on a $260,000 loan balance as $1,300, what is the borrower's interest rate to the nearest half percent? a. 6% b. 6½% c. 5% d. 5½% - a. 6% The most common method of disposing of solid waste materials, by layering them between several feet of soil, are? a. landfills b. storage tanks c. encapsulations d. electromagnetic - a. landfills A real estate professional signs a contract with a buyer. Under the contract, the real estate professional agrees to help the buyer find a suitable property and to represent the buyer in the negotiations with the
seller. The buyer may not sign an agreement with any other real estate professional. What kind of agreement has this real estate professional signed? a. exclusive buyer listing agreement b. exclusive buyer representation agreement c. open buyer agency agreement d. option contract - b. exclusive buyer representation agreement The principals in a sales contract are? a. broker and seller b. broker and buyer c. buyer and his wife d. buyer and seller - d. buyer and seller A grantor conveys property by delivering a deed. The deed contains five covenants. This is MOST likely a? a. general warranty deed b. quitclaim deed c. special warranty deed d. deed in trust - a general warranty deed All of the following have been proven to pose health hazards EXCEPT: a. asbestos fibers b. carbon monoxide c. radon d. lead-based paint - c. radon
A contract that binds one party to its terms but which is unenforceable against the other party is best described as: a. void contract b. voidable contract c. invalid contract d. partially binding contract - b. voidable contract All of the following are used in calculating income rate value (IRV) except: a. property value b. rate of return c. net annual income d. depreciation factor - d. depreciation factor A woman grants a life estate to her son-in-law and stipulates that, upon his death, the title to the property will pass to her grandson. The grandson's interest is known as a(n): a. remainder b. reversion c. estate at sufferance d. estate for years - a. remainder A percolation test: a. needed to qualify a buyer for financing b. required to determine radon levels c. must be passed to determine if a lot will sustain a septic system d. necessary if a house can be installed with an outside water spigot - c. must be passed to determine if a lot will sustain a septic system
A primary benefit of property held in joint tenancy is: a. ownership by a maximum of two people b. the fractional interests of the owners, which can be different c. the fact that additional owners may be added later d. the right of survivorship - d. the right of survivorship A licensed real estate sales associate has a written contract with the employing broker that specifies that the sales associate will not be treated as an employee for federal tax purposes. The sales associate's entire income is from sales commissions rather than an hourly wage. Based on these facts, the sales associate will be treated by the IRS as: a. real estate assistant b. employee c. subagent d. qualified real estate agent - d. qualified real estate agent A woman conveys the ownership of an office building to a nursing home. The nursing home agrees that the rental income produced by the building will pay for the expenses of caring for the women's parents. When both her parents have died, ownership of the office building will revert to the woman. The estate held by the nursing home is a: a. remainder life estate b. legal life estate c. life estate pur autre vie d. temporary leasehold estate - c. life estate pur autre vie A country music singer who owns a cattle ranch enters into a sale and leaseback agreement with a local dentist. Which statement is TRUE of this arrangement?
b. Real Estate Settlement Procedures Act (RESPA) c. Equal Credit Opportunity Act (ECOA) d. Fair Housing Act - a. Truth in Lending Act Which of the following statements is true? a. a first mortgage is always larger than a second mortgage b. a second mortgage cannot be foreclosed without the consent of the first mortgage holder c. neither of the above d. both of the above - c. neither of the above A general warranty deed has: a. no covenants b. three covenants c. neither of the above d. eight covenants - c. neither of the above Which situation does NOT violate the federal Fair Housing Act: a. the refusal of a property manager to rent an apartment to a Muslim couple who are otherwise qualified b. the general policy of a loan company to avoid granting home improvement loans to individuals living in transitional neighborhoods c. the intentional neglect of a real estate professional to show an Asian family any property listings in neighborhoods other than those with a majority of Asian residents d. A widow's insistence on renting her spare bedroom only to another widowed women - d. A widow's insistence on renting her spare bedroom only to another widowed women If a person dies without a will:
a. he has died intestate b. the state will look to its laws of descent and distribution to determine how the property will pass c. the government will take the property through escheat if there are no heirs d. all of the above - d. all of the above In a township, which statement is TRUE: a. Section 31 lies to the east of Section 32 b. Section 18 is by law set aside for school purposes c. Section 6 lies in the northeast corner of the township d. Section 16 lies to the north of Section 21 - d. Section 16 lies to the north of Section 21 The form of tenancy that will expire on a specific date is a: a. joint tenancy b. tenancy for years c. tenancy at sufferance d. tenancy by the entirety - b. tenancy for years A large home that lacks sufficient indoor plumbing suffers from which condition: a. functional obsolescence b. curable physical deterioration c. incurable physical deterioration d. external obsolescence - a. functional obsolescence A developer built a structure that has six stories. Several years later, an ordinance was passed in that area banning any building six stories or higher. This building is a:
If the owner-lessor of a unit in an owner-occupied three-family dwelling discriminates: a. there is an exemption in the 1968 federal Fair Housing Act, as long as a broker is not employed and no discriminatory advertising is used b. there are no exemptions to the 1968 law c. there is an exemption under the 1866 law d. the 1968 law allows exemptions, but this would not be covered by any of them - a. there is an exemption in the 1968 federal Fair Housing Act, as long as a broker is not employed and no discriminatory advertising is used A real estate broker specializes in helping both buyers and sellers with the necessary paperwork involved in transferring property. Although not an agent of either party, the broker may not disclose either party's confidential information to the other. The broker is BEST described as a(n): a. buyer's broker b. independent contractor c. dual agent d. transaction broker - d. transaction broker The suffix "or" means: a. to receive b. to give c. to qualify d. to borrow - b. to give In most suburbs, which method of description would be used today? a. government survey system b. metes and bounds
c. rectangular survey d. lot and block - d. lot and block When a buyer signs a mortgage to borrow money to purchase a home, what has been created? a. voluntary, specific lien b. involuntary, specific lien c. general, statutory lien d. equitable, involuntary lien - a. voluntary, specific lien An individual who owns a living unit plus a share in a common recreation area and parking area in fee most likely owns a: a. standard subdivision b. planned unit development c. cooperative d. condominium - d. condominium Three women owned a house as joint tenants. In the year 2009, one died. Last month, another died. Based on these facts, which of the following correctly describes the remaining woman's ownership interest in the house? a. joint tenancy with the deceased women's heirs b. tenancy in common with the deceased women's heirs c. severalty d. partitioned tenancy by the entirety - c. severalty "Definite duration" refers to: a. life estate
The owner of a house wants to fence the yard for the family pet. When the fence is erected, the fencing materials become real estate through: a. severance b. subrogation c. annexation d. attachment - c. annexation A tenant on a long-term commercial lease wants to go out of business. Since the rent is now worth much more than she is currently paying, she might most likely consider: a. assigning the lease b. subletting the property c. asking the owner to rescind the lease d. surrendering the premises - b. subletting the property Which of the following is NOT an encumbrance on real property? a lease b. easement c. homestead right d. restrictive covenant - c. homestead right Which of the following is NOT done under the police power of the state? a. control land use b. control rents where applicable c. collect taxes d. declare as "unfit for occupancy" - c. collect taxes
Police powers include all of the following EXCEPT? a. zoning b. deed restrictions c. building codes d. density requirements - b. deed restrictions A seller wants to net $165,000 from the sale of a house after paying the broker's fee of 6% and other closing costs of $2,635. The seller's gross sales price will be: a. $152, b. $174, c. $152, d. $178,335 - d. $178, Three acres equals how many square feet? a. 43, b. 130, c. 156, d. 27,878,400 - b. 130, A buyer is purchasing a condominium unit in a subdivision and obtains financing from a local bank. In this situation, which term BEST describes this buyer? a. vendor b. mortgagor c. grantor
b. $23, c. $28, d. $26,000 - c. $28, Functional obsolescence can be created by: a. deterioration of the driveway b. an over-improvement c. deterioration of of the property next door d. forces outside the property itself - b. an over-improvement When a mortgage is given as part of the selling price of the property, it is a: a. blanket mortgage b. wrap-around mortgage c. second mortgage d. a purchase-money mortgage - d. a purchase-money mortgage The clause in a deed of trust or mortgage that permits the lender to declare the entire balance due and payable if some event does or does not occur is: a. the elevator clause b. the escalator clause c. the acceleration clause d. the forfeiture clause - c. the acceleration clause A parcel of vacant land has an assessed valuation of $274,550. If the assessment is 85% of the market value, what is the market value?
a. $315, b. $320, c. $1,830, d. $323,000 - d. $323, A property is bought based on fraudulent statements by the listing broker. The sales contract is most likely: a. void b. voidable c. valid d. illegal - b. voidable Which of the following BEST describes a capitalization rate? a. amount determined by the gross rent multiplier b. rate of return an income property will produce c. mathematical value determined by a sales price d. rate at which the amount of depreciation in a property is measured - b. rate of return an income property will produce All but which of the following forms of ownership are recognized in Maryland? a. tenancy in common b community property c. trust d. ownership in severity - b. community property A tenant's landlord plans to sell the building in which the tenant lives to the state so that a freeway can be built. The tenant's lease has expired, but the landlord permits the tenant to stay in the apartment
