master Exam #1

Master Exam #1

1 / 150

A fee simple absolute estate would best be defined as:

2 / 150

Of the following, which best defines a fee simple estate:

3 / 150

An estate is granted to "A" for the life of "X".  "A" dies while "X" is still living. The estate:

4 / 150

Tyson owns a store building which he leased to Crown for seven years. Crown's estate in the store building is:

5 / 150

An instrument which usually transfers possession of real property, but does not transfer ownership is:

6 / 150

Which of the following would be considered real property?

7 / 150

Jones conveyed is ranch to Brown using a land contract. The ranch was serviced by a mutual water company, and Jones was a stockholder in the company. The stock which Jones owned was appurtenant to the land. Does Brown have to enter into a separate contract for the stock of the mutual water company:

8 / 150

The  law permits a real estate licensee to act as an agent in the sale of some mobile homes. All of the following act are grounds for discipline by the Real Estate Commissioner against a real estate salesperson's license, except:

9 / 150

Personal property can never:

10 / 150

Which of the following is always required in joint tenancy ownership of real property:

11 / 150

When a pest control company discovers no evidence of infestation of termites, but discovers conditions which may lead to such infestation, the cost of correcting such conditions is paid by:

12 / 150

To alienate title to property one:

13 / 150

When real property is sold, a copy of the structural pest control report must be given, if requested, to:

14 / 150

Legally and technically, property is defined as;

15 / 150

A deed;

16 / 150

Of the following types of deeds, which one would contain no warranties, expressed or implied:

17 / 150

The main purpose of a deed is to:

18 / 150

When a valid grant deed is prepared, title passes when it is:

19 / 150

Which of the following persons would usually be in the weakest position against loss of property due to a claim of title by an outside person;

20 / 150

An easement could be created for what length of time:

21 / 150

The land that is benefitted by an easement is called the:

22 / 150

The requisites of a grant deed when compared to a land contract of sale may differ with respect to:

23 / 150

Land is subject to an easement is said to be:

24 / 150

Mr. and Mrs. Winters hired the Superb Construction Company to install a swimming pool on their residential premises. In the event the construction company was unpaid and it was necessary for them to file a lien for payment of the contract, the encumbrance created would be a:

25 / 150

If there has not been an agreement to the contrary, all of the following would qualify as a negotiable instrument, except:

26 / 150

A straight note, same term and interest rate, would:

27 / 150

Which of the following is not a true statement about easements:

28 / 150

An easement in gross:

29 / 150

Easements are terminated by all of the following except:

30 / 150

A tenement in good standing under a valid 5 year lease which makes no mention of assignment or sub-leasing, may legally do which of the following:

31 / 150

A formal declaration, not an oath, that a statement is true or that the declarer will tell the truth is:

32 / 150

Following proper action by the local authorities, the zoning on a vacant lot was changed from "commercial" to "residential". Such an action is called:

33 / 150

The right or power to sell a property in the event of a default under the terms  of the trust deed is given by:

34 / 150

Agent John has given seller Henry an offer that includes the phrase "All kitchen appliances now on the property are to be left with the house and become the personal property of the buyer at the close of escrow." Henry accepts all of the other terms of the offer, but objects to leaving the appliances. John knows the buyers really want the house, and don't want to lose the deal over a couple of appliances, so he crosses out that item and initials it on the contract on behalf the buyers. He does this despite the fact that the buyers are on vacation and cannot be consulted about this deletion. Such action by John would most accurately be described as:

35 / 150

When comparing condominiums and rented apartments, which of the following would be true:

36 / 150

A change in zoning ordinance could be initiated by:

37 / 150

Installment notes often include an "or more" clause. Such a clause would:

38 / 150

When a blanket mortgage is placed upon a property and a "release schedule" is put into the mortgage showing the amount of the loan that must be paid off for each of the lots, those individual amounts would likely be proportionately larger for the first lots that are sold. The reason for this practice is:

39 / 150

Another name for an estate of inheritance is:


40 / 150

An acceleration clause is inserted in a note that is otherwise negotiable. The addition of the clause:

41 / 150

An "open-end" provision in a mortgage would benefit the borrower the most if they:

42 / 150

When the term "beneficiary statement" is used by those in real estate finance, it identifies a statement made:

43 / 150

Once a judgement has been obtained against real property, a plaintiff would obtain which of the following in order in to cause the property to be sold:

44 / 150

Authorization to sell a parcel of real property in the event of a default is given by:

45 / 150

In order to operate a competitive, yet profitable business, a real estate broker needs to ne concerned with "desk cost."  Which of the following most nearly represents the correct way to calculate desk cost:

46 / 150

When a title company issues a California standard policy of title insurance, the policyholder is insured against loss which occurs because of:

47 / 150

Upon discovering that a salesperson in their office was receiving a referral fee  from a local lender for every real estate loan the salesperson referred to the lender, the broker of  record in that office took only two actions: They discharged the salesperson, and they warned all other salespersons in the office never to accept such fees. Based only on the foregoing, which of the following is most nearly correct:

48 / 150

The listing agent for a residential property can legally complete the entire Real Property Transfer Disclosure Statement:

49 / 150

Broker Davis has had a house listed for sale for nine months without selling it. He/She knows that the building needs major structural repairs, and he/she has listed it at 10% above its fair market value. He/She runs and advertisement in a newspaper that says "Three bedroom Victorian. You won't believe the price! Move right in. Davis - 234-5678." This advertisement is bad because:

50 / 150

If a licensee placed the following ad in a newspaper, which of the following would describe the ad? "Three bedroom, two bath, pool, and spa, large lot -- $167,000.  555-1342"

51 / 150

When a broker receives trust funds and places them in a trust account, which of the following statements is most nearly correct about interest earned on those funds:

52 / 150

Of the following which is considered a violation of fair housing laws in regards to periodic tenancy:

53 / 150

When renting residential property, the amount of a security deposit which a lessor may legally charge from a lessee is determined in part by which of the following:

54 / 150

Among the choices available to an investor, stocks, and bonds, when compared with real property, are usually thought to be:

55 / 150

Mike Coogan, a new real estate salesperson, made strong efforts to obtain listings in a non-integrated community. He found success by insinuating  to property owners that should minorities move into the area, the value of their home would decrease. Which of the following terms best describes the activities of Salesperson Coogan:

56 / 150

A person sold his home and took back a note secured by a purchase-money deed of trust. He selected a real estate broker from the telephone book and asked him to service the loam. If the broker takes on this duty, state law requires them to:

57 / 150

A real estate broker who specializes in selling residential property in a given area may refuse to accept a listing on a property in that area for which of the following reasons:

58 / 150

By means of the Federal Fair Housing Law, Congress established a national policy of fair housing throughout the United States. This policy applies to which of the following:

59 / 150

The mortgage insurance on an FHA loan:

60 / 150

When the general level of prices decreases:

61 / 150

The exercise of police power whereby land is divided into districts accordingly to the use to which the land may be put is known as:

62 / 150

When the Federal Reserve Board increases reserve requirements, it will:

63 / 150

A real estate salesperson went into a neighborhood to obtain listings of residential property. They made representation that because of the entry into the neighborhood of minority groups, property values would be reduced by a decline in the quality of schools and an increase in crime rate. These practices by the salesperson are:

64 / 150

A builder needs a long-term loan of $3,000,000 to develop a new shopping center. Which of the following would usually be best source of such funds:

65 / 150

David gave a grant deed to John transferring title to a house. The title is subject to a condition stating that title will be forfeited if alcoholic beverages are ever sold on the property. John would have which of the following types of estates:

66 / 150

Which of the following statements is most nearly true concerning the activities of mortgage companies:

67 / 150

A family rents a vacation home from September 1,2012 to January 1, 2013. Their tenancy would properly be classified as:

68 / 150

Which of the following does not buy loans in the secondary mortgager market?

69 / 150

The term used by lenders, "mortgage yield" best describes:

70 / 150

The basic protection of a lender on a purchase-money second trust deed would be:

71 / 150

In financing for new construction, the lender will usually release the final payment to the builder when the:

72 / 150

To qualify a real property sales contract for recordation, it must:

73 / 150

The two requirements which governmental units must observe in the exercise of the power of eminent domain are:

74 / 150

The purpose of Truth-in-Lending Act is to:

75 / 150

The real estate financing instrument which transfers equitable title to real property, but retains legal title in the seller is called:

76 / 150

Most likely, the United State Attorney General would act to enforce the Federal Open Housing Law whenever:

77 / 150

Which of the following defines a "mortgage loan"?

78 / 150

Who pays the points on a Cal-Vet loan?

79 / 150

When lenders use the term "debt-income ratio" they are referring to:

80 / 150

When examining a properly-prepared closing statement, the broker would discover that a mortgage assumed by the buyer would appear as:

81 / 150

Which of the following statements is true concerning escrow procedures:

82 / 150

All of the following are essentials of each and every contract, except:

83 / 150

A prospective buyer would be entitled to damages from a real estate broker in the event the broker:

84 / 150

Four months ago, a seller accepted a proper offer to purchase his real property. The contract was in writing. Later, the seller refused to complete the transaction, since he felt the value of the property would increase in the near future. Under these circumstances, the Statute of Limitations could affect the rights of the buyer to prevail civil action, due to a breach of a written contract, within:

85 / 150

For more than one hundred years, the Garza family has owned and operated a gold mine on federal land. The only access  to their mining claim is across an adjoining parcel. That parcel is sold to a new owner, who fences off the parcel and padlocks the gate across the access road. The Garzas would be best advised to:

86 / 150

Which of the following is not essential to the creation of an agency relationship:

87 / 150

Richards agreed to list his property for sale with Broker Jackson. In using a standard listing form, Richards completed Paragraph 10 with the following words: "Delete provisions in Paragraph 3c above which says, Agency is hereby authorized to accept on my behalf a deposit toward the purchase price in any amount." If broker Jackson produced a buyer:

88 / 150

A broker who is hired by an owner to sell his property must reveal all significant and material information to the principal. Which of the following would be considered material information and must be revealed:

89 / 150

Salesperson Kingston presented to broker Wright buyer Kingsford’s offer to purchase seller Brightwood’s real estate, accompanied by earnest money deposit in the form of a personal note in the amount of $1000. Broker right should inform salesperson Kingston that:

90 / 150

On March 5th, suspected buyer gave a broker his personal check for $10,000 payable to the seller along with an offer to buy the property. He told the broker that the check should not be cashed until March 30th. Which of the following is correct?

91 / 150

Broker Farr is showing property that he has listed to Olsen. Broker Farr knows that there are massive plumbing repairs to be made. Broker Farr:

92 / 150

Which of the following would not be legally proper for a license to do?

93 / 150

When an existing contract is replaced by an entirely new contract, it is in an act of:

94 / 150

When is a broker relieved of the obligation to present an offer to purchase real property to the principal:

95 / 150

Where the buyer withdraws their offer to purchase real property prior to acceptance by the seller, the:

96 / 150

Ms. Swan listed a vacant lot with Broker Benton for $114,000. A prospective named Gardner submitted an offer at a purchase price of $110,000 with the offer to expire in 30 days. The next day, Ms. Swan made a counteroffer with the sales price to be $112,000. When informed of the counteroffer, Gardner would not accept it. Three days later, Ms. Swan delivered to Broker Benton a signed acceptance of Gardner's $110,000 purchase offer. When Broker Benton told Gardner of Ms. Swan's acceptance, Gardner told him he had decided not to buy the property. Based on the foregoing actions, there is:

97 / 150

Compliance with the agency relationship law enacted as a part of the civil code would be required in which of the following transactions:

98 / 150

Private restrictions on real property can be written either as a condition or as a covenant. Which of the following is most correct concerning such restrictions:

99 / 150

A developer can use the Improvement Act of 1911 as amended to raise funds for all of the following purposes, except:

100 / 150

The "GPAM" mortgage loan provides for:

101 / 150

In May 2016, Mr. Sanders leased a unit in his apartment house to a tenant for a two-year term. The tenant prepaid the last two months' rent at the time he entered into the lease agreement. For federal income tax purposes, that amount will be considered a income for Mr. Sanders:

102 / 150

One advantage of an installment sale for federal income tax purposes, is that:

103 / 150

Broker Green obtained a listing from Brown to sell his home. Brown told Green  the sewers were in and connected and signed a listing to that effect. Green was of the opinion that there were no sewers installed in that street, so he checked with the city and found he was correct. Green showed the house to Jones, who did not ask about the sewers, and Green made the sale without any comment. Later, Jones found out that the sewers were not in. Which of  the following is true:

104 / 150

Mr. O'Riley paid an owner $10 for an option containing this clause: "Option to be for 60 days from June 1, 2017. Upon exercise of option, holder is to purchase within 30 days thereafter for all cash consideration." On July 10, Mr. O'Riley sold and assigned his option for $1000. On July 28, the new holder notified the owner that he would purchase on August 15. The owner claimed the option was void. The option was:

105 / 150

If a condominium owner lives in her condominium and pays all of the following, which of the following would be deductible for federal income tax purposes?

106 / 150

In which of the following situations would a parcel of property be reassessed?

107 / 150

Community apartment projects and condominiums come within the subdivision provisions of the California Real Estate Law when they contain how many units:

108 / 150

Where there are local minimum housing requirements, builders must:

109 / 150

Under the federal income tax regulations, an individual may not deduct a loss on the sale of residential property unless:

110 / 150

A carpenter installed hardwood floors in a new house, and when he was not paid for his work, file a mechanic's lien. The priority of his claim is:

111 / 150

A person who held a life estate leased the property for five years and then died one month after signing the lease. The new owners ordered the lessee to move out. The lease was:

112 / 150

Georgene Creason is selling time-shares in her Wildcare subdivision. She  mailed advertisements to 10,000 people, offering the chance to win a prize, but did not reveal that in order to be eligible, the person must visit Wildcare and listen to a sales presentation. All of the prize winners had become owners in Wildcare. Is there anything wrong with this situation:

113 / 150

The Uniform Commercial Code, Division 6, which pertains to bulk sale transfer  of business goods, exists primarily for the protection of:

114 / 150

Anderson sold a farm to Barnes on May 1, 2017. The real property taxes for the 2017-2018 tax year:

115 / 150

If a ranch is 36 miles square, how many townships would it contain:

116 / 150

Owner Armstrong gave Broker Weeks an exclusive authorization to sell Armstrong's ranch. As part of the agreement, Broker Weeks agreed to advertise the ranch in a catalog that Weeks publishes and distributes to other real estate brokers. For this added service, Armstrong paid Broker Weeks $1000 for this advertising service at the time Owner Armstrong signed the listing. Under current real estate law, this payment:

117 / 150

Baylor made an offer on the purchase of a vacant residence and gave a cash deposit with the offer. The offer was presented through Broker Harris. The offer was accepted by the seller. Prior to the close of the transaction, Baylor requested permission from Harris to enter the house for the purpose of painting and making minor repairs. Which of the following is true:

118 / 150

In order to earn $2000 per month, the amount a person would have to invest at 8% would be:

119 / 150

The appraisal of an income producing property is made as of a "given date" to indicate:

120 / 150

A buyer bought a new house for the appraised value, paying a 20% cash down payment and financing the balance with a loan bearing an 11% per annum interest rate. If the buyer paid $7,040 in interest the first year, what was the appraised value of the property:

121 / 150

It would be perfectly ethical for an appraiser to do which of the following:

122 / 150

A residential purchase agreement read, "Seller to take back a second trust deed securing a note for $50,000, amortized over 10 years, and payable or more per month, including interest at 5% per annum from March  5, 2017." If the first payment date on the second trust deed note is April 15, 2017, how much of the first payment will go to the reduction of principal:

123 / 150

McHugh purchased a home for $58,000, paying 21.25% down and financing the balance on a 30-year fully amortized loan with interest at 5.25% per annum. The lender will require monthly impounds for taxes ($5800 per year) and insurance ($1478 per year). Of the following answers, which is the nearest to the total monthly payment McHugh will need to pay:

124 / 150

A major transportation route has a single line of store buildings along one side. This know as:

125 / 150

Gutierrez bought a parcel of raw land twenty-five years ago. She decided to subdivide the land into four separate lots and today sold each lot for $100,000. The adjusted basis for each lot was $20,000. Gutierrez' long-term capital gain on these transactions is:

126 / 150

An appraiser, in arriving at an estimate of value secured under each of the three approaches in appraising:

127 / 150

In arriving at an estimate of value, an appraiser would be most interested in the date:

128 / 150

The first step in the appraisal process is to:

129 / 150

Definitions of market value are least concerned with:

130 / 150

When appraising real property, the appraiser attempts to estimate value. The value arrived at by the appraiser is:

131 / 150

An appraiser is using the market data approach comparing the prices of comparable properties to the subject property. If the comparable properties have a feature that is not present in the subject property, the value of that feature will be:

132 / 150

The hardest and yet the most important part of the market data method of appraising is:

133 / 150

Rental schedules for various units of space are realistically established on what basis:

134 / 150

A final estimate of the value of any singly-family residence is:

135 / 150

A developer ordered several truckloads of soil to be used in a new housing project for backfill. His most probable intended use would be:

136 / 150

Which of the following would be defined as a fixture in the law:

137 / 150


138 / 150

To arrive at a capitalization rate in the appraisal of an income-producing property, no provision should be made for which of the following:

139 / 150

In using the capitalization process, which of the following cannot be deducted to determine the net income?

140 / 150

Which of the following would be considered an example of economic obsolescence?

141 / 150

Of the following factors, that which would not contribute to obsolescence is:

142 / 150

Under California law, the Real Estate Commissioner has the authority to do which of the following:

143 / 150

Harris and Davis, single people, owned a parcel of real property as joint tenants. Harris encumbered his interest for $10,000 borrowing the amount to medical bills without the knowledge or consent of Davis. Shortly thereafter, Harris died, with the debt still unpaid. Which of the following would be true:

144 / 150

If five people own property as joint tenants:

145 / 150

Ames, Barnes, and Crandal are owners of a vacant lot, holding title to the parcel of real property as joint tenants. When Ames dies, and is survived by Barnes and Crandal, it would be correct to say:

146 / 150

When owners of real property hold title as tenants in common:

147 / 150

When real property is held by husband and wife as community property, an agreement to sell that property which has been signed by only one spouse would be considered:

148 / 150

Adams sold his house to Brooks, who did not record the deed, but took up residency there. Adams then sold property to Carr, who reviewed the county recorder's records, but did not examine the property. Adams gave Carr a deed, which Carr recorded. Which of the following would be true concerning title to the property:

149 / 150

According to the California  Department of Real Estate regulations, it is commingling when a broker:

150 / 150

Of the following, which would most nearly refer to loss in value due to economic obsolescence:

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