Metro Broker Academy Final Test 2021
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Questions and Answers

What should a buyer's agent do for their client?

  • Accept information as accurate from the listing.
  • Have an attorney state all the seller's claims in writing.
  • Verify all information from the listing, through public records and inspections. (correct)
  • Tell the client to beware - some information may not be accurate.

    • What can terminate a license?

  • All the above (correct)
  • Withdrawal of consent
  • Sale of land
  • Terms of license agreement
  • Nothing ends a license
  • Death of either party

    • What best describes ownership for a parking garage and office buildings?

  • A condominium (correct)
  • Solo owner
  • Tenants in common
  • A cooperative

    • What does a buyer use to determine their property line and check for encroachments?

    <p>Survey</p> Signup and view all the answers

    A friend tells you another agent isn't doing a good job with their listing. What should you do?

    <p>Tell them to contact the listing broker.</p> Signup and view all the answers

    The real estate settlement procedures act requires all the following except...

    <p>Immediate delivery of the good faith estimate</p> Signup and view all the answers

    Mortgage fraud can lead to all the following except...

    <p>Long-term increase in property value.</p> Signup and view all the answers

    The clause that protects an owner from suit if the foreclosure sell does not cover the loan is...

    <p>Exculpatory clause</p> Signup and view all the answers

    What is a promissory note?

    <p>The instrument that serves as evidence of the debt.</p> Signup and view all the answers

    How much does 4.0 points on a $95,000 loan cost?

    <p>$3,800.00</p> Signup and view all the answers

    If less new houses are being built, what might be the effect?

    <p>Already built homes will increase in price.</p> Signup and view all the answers

    If you have the most expensive house in the neighborhood, it might not be worth that much more because of the principle of...

    <p>Regression</p> Signup and view all the answers

    You are listing a 5 story, 10-bedroom, 10 bath house with 5 pools, a sauna, steam room, and much more. How would you determine the value?

    <p>Suggest that a professional appraisal be done.</p> Signup and view all the answers

    If one party of a Joint tenant sells, what happens?

    <p>The original owners will be tenants in common with the new owner.</p> Signup and view all the answers

    Who is responsible for damages from an encroachment?

    <p>The owner of the property that is causing the encroachment.</p> Signup and view all the answers

    If an owner is violating CC&R, what can neighbors do?

    <p>Get a court injunction against the action.</p> Signup and view all the answers

    Does the sale of the property terminate a verbal license?

    <p>Yes, a license ends with the sale of the land.</p> Signup and view all the answers

    A property deeded to be used 'so long as' describes what ownership?

    <p>A fee simple determinable</p> Signup and view all the answers

    A landowner who has used a path on his neighbor's land to move his crops, may claim ________ to keep such use when the property is sold.

    <p>Easement by prescription</p> Signup and view all the answers

    What does the covenant of warranty forever do?

    <p>B and C</p> Signup and view all the answers

    What is an example of the use of police power?

    <p>Zoning laws</p> Signup and view all the answers

    What law passed by the Federal Trade Commission states an agent may call a client for 18 months, inquire for 3 months, and not after 9:00 PM?

    <p>Do-Not-Call Implementation Act</p> Signup and view all the answers

    The government must _______ and prove public use to exercise eminent domain.

    <p>Pay just compensation</p> Signup and view all the answers

    The owner of land being taken by eminent domain has the right to what?

    <p>Ensure the property is being taken for public interest</p> Signup and view all the answers

    The seller wants no public advertising of their property; should the agent advertise the property?

    <p>No, the agents owe the client obedience.</p> Signup and view all the answers

    Agent Brown has a property listed for David. Alex, a customer buyer, wants to look at the property. When Agent Brown shows Alex the property, who does he owe loyalty to?

    <p>David</p> Signup and view all the answers

    When taking a listing, an agent must disclose...

    <p>Any conflict of interest.</p> Signup and view all the answers

    Michael was employed to run the management of his condominium that he's lived in for 10 years. What license does he need?

    <p>No license needed</p> Signup and view all the answers

    The real estate commission _____

    <p>Has the authority to pass rules and regulation.</p> Signup and view all the answers

    According to license law, offers must be _____

    <p>Presented immediately or as soon as possible</p> Signup and view all the answers

    The real estate commission can set fees and commissions licensed agents charge.

    <p>No</p> Signup and view all the answers

    Two people open a new real estate company; which of the following is true?

    <p>If neither has a broker license, they must hire a qualifying broker.</p> Signup and view all the answers

    Can the commissioner be a licensed agent?

    <p>No</p> Signup and view all the answers

    What do you use to compare gross rent for a subject property, using a comparable?

    <p>The gross rent multiplier</p> Signup and view all the answers

    Which of the following is a type of depreciation?

    <p>Economic obsolescence</p> Signup and view all the answers

    Which of the following terminates a lease on a farm?

    <p>When landlord sells home to tenant</p> Signup and view all the answers

    A renter who stays past lease is what?

    <p>Estate at sufferance</p> Signup and view all the answers

    What is your take-home from a sale where the total commission was 6%, amounting to $13,545.00, with a 70/30 split with your broker?

    <p>$4740.75</p> Signup and view all the answers

    What is a CAM license for?

    <p>Manager of a subdivision association</p> Signup and view all the answers

    How many square feet are in an acre?

    <p>43560</p> Signup and view all the answers

    How many square miles are in a Township?

    <p>36</p> Signup and view all the answers

    What determines the fee for appraisal?

    <p>The amount of work and time</p> Signup and view all the answers

    In Georgia, most community associations are required to have what?

    <p>Fidelity insurance</p> Signup and view all the answers

    If an affiliate licensee violates rules and regulations or license law, is the broker required to notify the commission?

    <p>Yes, always</p> Signup and view all the answers

    If the lender requires 8 months of taxes and 5 months of hazardous insurance to establish the escrow account, how much would the buyer have to pay if the annual tax bill was $1900 and the annual hazardous insurance is $850?

    <p>$1620.84</p> Signup and view all the answers

    What is the broker responsible for over a licensed real estate agent?

    <p>Ensuring affiliates are properly licensed</p> Signup and view all the answers

    Regulation Z covers all the following except...

    <p>Real estate loan for a new business</p> Signup and view all the answers

    Who can give an FHA loan?

    <p>Only approved FHA mortgagee</p> Signup and view all the answers

    As a property manager, you're responsible for?

    <p>Collecting rent and coordinating any needed repairs</p> Signup and view all the answers

    What water rights control streams?

    <p>Riparian rights</p> Signup and view all the answers

    An agent received a personal note for earnest money. Is this legal?

    <p>Yes, if the offer states that the earnest is a personal note</p> Signup and view all the answers

    Based on Fair Housing, a landlord may refuse to rent to all the following except...

    <p>A drunk in rehab</p> Signup and view all the answers

    Based on the Sherman Antitrust Law, what is the commission for Atlanta?

    <p>Based on the broker's policy</p> Signup and view all the answers

    General agency refers to which of the following?

    <p>When a broker hires a salesperson</p> Signup and view all the answers

    When there is no ending date on a contract, besides facing fines, what law determines the contract ends in one year?

    <p>BRRETA</p> Signup and view all the answers

    What lien prevents an owner from selling during a suit?

    <p>Attachment lien</p> Signup and view all the answers

    What determines which lien has priority?

    <p>Date of recording with county</p> Signup and view all the answers

    Sale prices of $210,000, 95% loan, annual PMI of 0.65%. What is the monthly PMI payment?

    <p>$108.06</p> Signup and view all the answers

    What is the 6% commission of a $225,750.00 sale?

    <p>$13545.00</p> Signup and view all the answers

    According to the Georgia real estate commission, are net listings permitted?

    <p>No</p> Signup and view all the answers

    What information must be displayed for broker advertising?

    <p>The name of the broker as registered with the Georgia real estate commission</p> Signup and view all the answers

    Can Mr. Mark agree to buy your house if he cannot sell it?

    <p>Yes, but must be stated in the purchase and sale agreement first</p> Signup and view all the answers

    How is commission paid when leaving a broker?

    <p>Based on the contract you sign when you join the broker</p> Signup and view all the answers

    Which of the following is true about the secondary mortgage market?

    <p>It provides a market for lenders to sell their loans to acquire more funds for new loans</p> Signup and view all the answers

    When can a lender foreclose without having to go to court?

    <p>Power to sell clause</p> Signup and view all the answers

    A VA loan has...

    <p>Lower down payment</p> Signup and view all the answers

    When can the seller request earnest money for a property under contract, but that has a financing contingency?

    <p>When the buyer's military station transfer/move was canceled</p> Signup and view all the answers

    A buyer puts in an offer and deposits earnest money, but decides she likes a better house. Can she cancel her offer and get her money back?

    <p>Yes, but only before the offer is accepted</p> Signup and view all the answers

    Is earnest money an essential element of a real estate contract?

    <p>No</p> Signup and view all the answers

    Degrees and minutes are used in which form of legal description?

    <p>Metes and bounds</p> Signup and view all the answers

    What is Fructus industrials?

    <p>Personal property</p> Signup and view all the answers

    Sales price $220,000, with a 95% conventional loan. If the factor for principal and interest is $5 per $1,000 how much is due, and if they close on July 15 when is the payment due?

    <p>$1045 and Sept 1st</p> Signup and view all the answers

    Sale price of $180,000, LTV 95%, UFMIP is 1.75%g, and annual MIP of 1.35%. How much MIP is added monthly?

    <p>$195.74</p> Signup and view all the answers

    Sales price was $275,500, LTV 95%, UFMIP of 1.75%. How much UFMIP will be added to the loan?

    <p>$4580.19</p> Signup and view all the answers

    When can you do a net listing?

    <p>Net listing is illegal, by Georgia rules and regulation</p> Signup and view all the answers

    When can a broker not deposit earnest money, pending offer acceptance?

    <p>Only with permission from both buyer and seller</p> Signup and view all the answers

    What fees can be charged before the delivery of a good faith estimate/ Loan Estimate?

    <p>A credit report fee</p> Signup and view all the answers

    The federal truth in lending act...

    <p>Requires disclosure of the annual percentage rate expressed as a dollar amount</p> Signup and view all the answers

    Georgia is a...

    <p>Title Theory State</p> Signup and view all the answers

    In a title theory state, is judicial foreclosure required?

    <p>No</p> Signup and view all the answers

    In title theory states, before the lender can foreclose and sell, what must they do?

    <p>Advertise the property</p> Signup and view all the answers

    In replacement cost approach, you must first determine what?

    <p>Depreciation</p> Signup and view all the answers

    An office building has a gross quarterly income of $270,000, with an annual expense of 52% of gross income. What is the estimated net profit?

    <p>$518,500</p> Signup and view all the answers

    When does a tenant not have to pay rent?

    <p>When notice to move out has been properly given</p> Signup and view all the answers

    What does the covenant of quiet enjoyment mean for a renter?

    <p>Landlord promises tenant will not have to worry about any title claim against the property</p> Signup and view all the answers

    To be enforceable, when must a lease be in writing?

    <p>For more than one year</p> Signup and view all the answers

    Which best describes a trade fixture?

    <p>Trade fixtures can be removed prior to the end of the lease.</p> Signup and view all the answers

    The seller wants to keep the new fancy refrigerator and replace it with a different one. Can they do this?

    <p>Yes, but only if stated in the contract.</p> Signup and view all the answers

    What legal descriptions is/are used in Georgia?

    <p>A and C</p> Signup and view all the answers

    The broker may not be liable if a salesperson committed fraud, if he can prove which of the following?

    <p>All the above</p> Signup and view all the answers

    A sales person must meet all the requirements except...

    <p>Have a high school diploma</p> Signup and view all the answers

    When must earnest money be turned over to the broker?

    <p>Immediately</p> Signup and view all the answers

    What does a meeting of the mind mean?

    <p>The terms of the offer have been satisfied.</p> Signup and view all the answers

    Sales contracts should be _________.

    <p>Clear and detailed as possible.</p> Signup and view all the answers

    Brown sells to Mark who does not occupy the property or record the deed. Brown, being a jerk, then sells the property to David who does not record the deed but moves onto the property. Who owns the property?

    <p>David</p> Signup and view all the answers

    What makes a valid deed?

    <p>A and D</p> Signup and view all the answers

    Mark deeds his property to Brian and puts the deed in his safe. When Mark dies, the deed is found, who owns the property?

    <p>Mark's estate</p> Signup and view all the answers

    What protects an owner equity from title defects?

    <p>Owners title insurance</p> Signup and view all the answers

    A broker lowers the price of a listing, is this legal?

    <p>Yes, but only with the owner's permission.</p> Signup and view all the answers

    Study Notes

    Commission and Earnings

    • Take-home commission for a 6% sale totaling $13,545 with a 70/30 split: $4,740.75.
    • Importance of accurate commission breakdown when co-broker is involved.
    • Understanding how changes in split agreements affect final earnings.

    Licensing and Regulations

    • CAM license required for managing subdivision associations.
    • Fair Housing violations can lead to legal repercussions for landlords.
    • Net listings are prohibited under Georgia real estate regulations.

    Measurements and Calculations

    • An acre consists of 43,560 square feet.
    • A township encompasses 36 square miles.
    • Understanding of real estate measurements essential for property evaluation.

    Appraisal and Insurance

    • Appraisal fees are determined by the amount of work and time involved, not just market price.
    • Purchase-related inspections and insurance requirements vary by state; in Georgia, community associations need fidelity insurance.

    Financial Responsibilities

    • Monthly PMI payment for a 95% loan at $210,000 and 0.65% PMI stands at $108.06.
    • Detailed math required for foreclosures and earnest money deposits to ensure compliance with regulations.

    Lien and Foreclosure

    • An attachment lien prevents an owner from selling during a lawsuit.
    • Lien priority is determined by the date of recording with the county.

    Property Management Duties

    • Property managers primarily collect rent and coordinate repairs, ensuring property maintenance and tenant satisfaction.
    • "Covenant of quiet enjoyment" ensures tenants do not face title claims from landlords.
    • Earnest money isn't essential for a real estate contract but plays a significant role in buyer commitments.
    • Proper legal descriptions (metes and bounds, plat book) are vital for property identification.

    Contracts and Negotiations

    • Clear, detailed sales contracts are required to ensure enforceability.
    • Offers can be canceled by buyers before acceptance, allowing return of earnest money under certain conditions.

    Mortgage and Financing

    • FHA loans are given by approved mortgagees, not directly from the federal government.
    • Understanding of loan costs, down payments, and monthly financial obligations crucial for buyers.

    Ownership and Property Rights

    • Trade fixtures can be removed before the lease ends if specified in the contract.
    • Ownership disputes can arise based on recording deeds; unrecorded deeds can lead to complications.

    Agency Relationships

    • General agency relationship defined as a broker hiring salespersons.
    • Agents must verify all information related to property transactions rather than relying solely on listings.

    Real Estate Practices

    • Use of a survey to determine property lines and check for encroachments is standard practice.
    • Understanding real estate laws and procedures is crucial for compliance and protecting all parties involved.

    Miscellaneous

    • Georgia is considered a title theory state, meaning judicial foreclosure is not required.
    • Knowledge of federal laws like the Truth in Lending Act is essential for lenders and borrowers to ensure transparency.

    This structured breakdown of the provided content highlights the critical concepts essential for understanding the real estate landscape and its regulations.### Use of HUD-1 Form

    • HUD-1 form details settlement costs for buyers and sellers in a real estate transaction.

    Buyer Settlement Costs

    • Buyers incur various settlement costs that need to be evaluated during the purchasing process.

    Good Faith Estimate

    • Immediate delivery of the good faith estimate is required to inform borrowers about loan costs and terms.

    Mortgage Fraud Consequences

    • Mortgage fraud can result in increased loan processing fees, increased foreclosure rates, and heightened crime in neighborhoods, but it does not lead to a long-term increase in property value.

    Exculpatory Clause

    • The exculpatory clause protects property owners from lawsuits if foreclosure sales do not suffice to cover the loan.

    Promissory Note Definition

    • A promissory note serves as evidence of a loan debt.

    Cost of Loan Points

    • 4.0 points on a $95,000 loan costs $3,800.

    New Construction Impact

    • A decrease in new home construction can lead to an increase in prices of existing homes.

    Real Estate Principles

    • The principle of regression suggests that the value of a highly valued home may not appreciate significantly if surrounded by lower-valued properties.

    Property Valuation

    • Suggesting a professional appraisal is recommended for accurately determining the value of unique properties.

    Joint Tenancy Sales

    • If a joint tenant sells their share, the original owners will become tenants in common with the new owner.

    Encroachment Responsibility

    • The owner causing the encroachment is liable for damages.

    CC&R Violations

    • Neighbors may seek a court injunction if someone violates covenants, conditions, and restrictions (CC&Rs).

    Verbal License Termination

    • A verbal license terminates with the sale of the property.

    Fee Simple Determinable

    • Property deeded with the phrase "so long as" indicates a fee simple determinable ownership.

    Easement by Prescription

    • A landowner may claim an easement by prescription for using a neighbor’s land if established usage continues when the property is sold.

    Covenant of Warranty Forever

    • This covenant protects the owner from claims against the title and provides financial protection related to the title.

    Police Power Example

    • Zoning laws are an example of police power utilized by the government.

    Do-Not-Call Implementation Act

    • This Federal Trade Commission law regulates agent-client communication, restricting calls after 9:00 PM.

    Eminent Domain Requirements

    • The government must pay just compensation to property owners when exercising eminent domain.

    Public Interest in Eminent Domain

    • Property owners can ensure that their land is taken for public interest when subjected to eminent domain.

    Client Obedience

    • Agents must respect a client's request for no public advertising of their property.

    Loyalty in Real Estate Transactions

    • An agent owes loyalty to the property owner (the seller) during a transaction.

    Conflicts of Interest Disclosure

    • Agents must disclose any potential conflicts of interest when taking a listing.

    Licensing for Property Management

    • No specific license is needed for individuals managing their personal condominium.

    Real Estate Commission Authority

    • The commission possesses the authority to pass rules and regulations governing real estate practices.

    Timing for Offer Presentation

    • Offers must be presented immediately or as soon as possible according to licensing law.

    Fee and Commission Regulation

    • The real estate commission does not have the authority to set fees or commissions for licensed agents.

    Qualifying Broker Requirement

    • A new real estate company must hire a qualifying broker if neither co-owner holds a broker's license.

    Commissioner Licensing

    • The commissioner of real estate cannot be a licensed agent.

    Gross Rent Comparison

    • The gross rent multiplier is used to compare gross rents for a subject property against comparable properties.

    Type of Depreciation

    • Economic obsolescence is a recognized type of depreciation in real estate valuation.

    Lease Termination on Farms

    • A farm lease may terminate when the landlord sells the home to a tenant.

    Estate at Sufferance

    • A renter who remains in a property after the lease expiration is classified as an estate at sufferance.

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    Description

    Prepare for the Metro Broker Academy Final Practice Test with these flashcards. This quiz covers crucial concepts like commission splits and real estate licensing. Use it to self-assess your knowledge before the final examination.

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