Untitled Quiz

Questions and Answers

Does the seller have the right to terminate the listing contract?

Yes, but the seller has the right to refuse the offer.

Which type of validity does a contract signed under a threat fall under?

Void

Valid

Voidable (correct)

Enforceable

What is the status of the transaction if the buyer withdraws their offer after the seller signs it?

The offer is withdrawn and no contract formed (correct)

A binding contract was formed

The seller can sue for breach

The buyer must honor the contract

What law requires contracts to convey an interest in real property to be in writing?

Statute of Frauds Signup and view all the answers

What may NOT terminate a real estate sales contract?

The buyer's inability to obtain a specific loan Signup and view all the answers

What could be a remedy available for breach of contract?

Liquidated damages Signup and view all the answers

If a buyer offers terms including an appliance and those terms are countered and not included, what doctrine applies?

Parole Evidence Rule Signup and view all the answers

What is true regarding a Contract for Deed?

It conveys real property interest Signup and view all the answers

Which situation describes a 'Buydown'?

Reducing the interest rate temporarily Signup and view all the answers

Match the following loan terms with their descriptions:

Lien Theory = Borrower receives title to the property at closing Title Theory = Borrower receives equitable title at closing Due on Sale Clause = Conditions under which the loan must be paid off upon sale Signup and view all the answers

Lenders can originate the loan higher than the Certificate of Reasonable Value.

False Signup and view all the answers

The lender must provide the Closing Disclosure at least 3 business days prior to the date of settlement when delivered electronically.

True Signup and view all the answers

What trigger term was used in a recent advertisement mentioning a specific loan interest rate?

APR Signup and view all the answers

Which statements would constitute a 'trigger term' under Truth in Lending Regulation Z?

Both A and B Signup and view all the answers

What clause is not typically found in an FHA 203b mortgage loan?

Due on Sale Clause Signup and view all the answers

What method of financing is indicated when the seller remains responsible for finance payments on a property?

Subject to loan Signup and view all the answers

How would an adjustment be made for a property comparison in square footage?

Subtract the difference in value from the comparable property Signup and view all the answers

Which of the following are components of a window? (Select all that apply)

Top plate Signup and view all the answers

What zoning term describes a request for a slight deviation from the current ordinance?

Variance Signup and view all the answers

What does the Standard 2-T Offer to Purchase and Contract allow for?

A 14-day delay in settlement before the contract can be terminated. Signup and view all the answers

Which property ownership right sets a boundary at the mean high tide water mark?

Littoral Signup and view all the answers

Which of the following statements is TRUE when a licensee is writing an offer using the Standard NCAR/NCBA 2-T?

The licensee may make changes to the Standard 2-T. Signup and view all the answers

In a buyer's offer on a property already under contract, what should the broker include?

A back-up contract addendum. Signup and view all the answers

Which of the following is a permitted activity for the listing broker when receiving multiple offers on a property?

Present all offers to the seller. Signup and view all the answers

What must a standard purchase contract state?

That the seller will transfer the property by general warranty deed. Signup and view all the answers

What options does a tenant have if they complained about a non-functioning toilet?

The tenant may stop paying rent and move out. Signup and view all the answers

What type of leasehold interest does a tenant have if they rent a house for an initial term of 18 months requiring a 60-day notice to vacate?

An estate from period to period. Signup and view all the answers

What is required by a municipality extending city services to a neighborhood previously serviced by well and septic?

Charge the current owner a special assessment. Signup and view all the answers

Which entities would be EXEMPT from obtaining a separate firm license?

Mary Jones, Broker. Signup and view all the answers

A full broker affiliated with Exceptional Realty must include the firm name in all advertisements.

True Signup and view all the answers

Who is generally exempt from having a broker's license?

Legal corporations selling their property. Signup and view all the answers

What must a valid listing agreement include?

Both A and B. Signup and view all the answers

If a licensee allows their license to expire or be revoked, what action should be taken?

Reinstate the license if it's expired for more than six months. Signup and view all the answers

What is the license status of a licensee on June 28 if they have failed to complete their required continuing education?

Active on the 28th but inactive on July 1st. Signup and view all the answers

Which of the following ads run by a provisional broker would be acceptable?

Both A and B. Signup and view all the answers

If a licensee sells their own home 'For Sale By Owner' and leaves out material facts, can they be disciplined?

True Signup and view all the answers

With regard to the activation of licenses, which of the following statements is NOT true?

A broker must wait 3 years to reactivate. Signup and view all the answers

What must Bonnie do to bring her inactive license to active status?

Complete 8 hours of continuing education and 60 hours of post-licensing. Signup and view all the answers

Which party MOST likely has the authority to levy special assessment fees against a property?

Homeowners associations. Signup and view all the answers

What kind of title does a seller with unquestionable ownership claim on a property for the past 10 years have?

Clear title. Signup and view all the answers

What term describes leaving real property to heirs using a will?

Bequest. Signup and view all the answers

What deed would most likely be used to convey property to the wife in a divorce situation?

Non-warranty deed. Signup and view all the answers

What must be present in a valid deed?

Delivery & voluntary acceptance to the grantee. Signup and view all the answers

What do public regulations of land use include?

Subdivision plans. Signup and view all the answers

If a commercial property needs additional parking spaces, what should the property owner do?

Seek a variance. Signup and view all the answers

What is an odorless, colorless gas that may cause lung cancer?

Radon. Signup and view all the answers

Which housing type is targeted for possible presence of lead-based paint?

Houses built before 1978. Signup and view all the answers

Why is asbestos an environmental concern?

When friable it throws dust particles into the air which cause lung disease. Signup and view all the answers

When must a firm disclose and obtain consent for dual agency?

Prior to acting as a dual agent. Signup and view all the answers

Which of the following would NOT create an agency relationship?

The payment of money. Signup and view all the answers

Which type of agency represents a landlord?

General agency. Signup and view all the answers

Most property managers are categorized under which classification of agency?

General agency because property managers are hired for a variety of tasks needing limited, binding decisions made on behalf of the client. Signup and view all the answers

What should a salesperson do when presenting a written offer to the seller?

Explain the advantages and disadvantages of the offer. Signup and view all the answers

In an exclusive agency listing agreement, when is a seller exempt from paying compensation?

When the seller procures the buyer. Signup and view all the answers

What type of contract describes an optionor giving an option to purchase over 5 years?

Unilateral. Signup and view all the answers

An agent may call clients in his database to ask for referrals even if they appear on the do not call list.

True Signup and view all the answers

What is the purpose of a Multiple or Cooperative Listing Service?

Provide exposure and opportunities for cooperation for marketed properties. Signup and view all the answers

What should the listing agreement include when a seller lacks the funds to complete a sale?

A short sale addendum. Signup and view all the answers

A real estate agent may contact a consumer they have a business relationship with for up to 18 months after the consumer's last purchase.

True Signup and view all the answers

What is TRUE regarding the first buyer who made an offer on a listed property?

The first buyer has no remedy since the parties were never under contract. Signup and view all the answers

If Mr. Jones makes a full price offer on a home contingent on his wife approving the contract, what will happen?

Yes, although the contract will be voidable at Mrs. Jones's option should she not approve of the contract. Signup and view all the answers

Study Notes

Window Components

Key components of a window include: Sole plate, Header, Stud, Top plate.

Zoning Variance

A variance is a request for a slight deviation from current zoning ordinances.

Real Estate Contract Delay

The Standard 2-T Offer to Purchase and Contract allows a 14-day delay in settlement before the contract can be terminated.

Property Ownership Rights

The littoral property ownership right establishes boundaries at the mean high tide water mark.

Licensee Changes

Licensees can amend the Standard 2-T contract when making offers on properties.

Backup Offers

When making an offer on a property already under contract, a buyer's broker should include a back-up contract addendum.

Broker Duties with Multiple Offers

A listing broker must present all offers to the seller to facilitate decision-making.

Transfer of Property

A standard purchase contract must specify that the seller will transfer property via a general warranty deed.

Tenant Rights

A tenant may cease rent payments and vacate if a landlord fails to address significant maintenance issues.

Estate Types

An estate at will allows a tenant to occupy a property until a specified legal process is completed (e.g., condemnation).

Municipality Assessments

Municipalities may charge special assessments to current owners when extending essential services like water and sewer.

License Exemptions

Certain entities, such as legal corporations selling property, are exempt from obtaining a separate brokerage license.

Advertising Compliance

Real estate advertisements must include the firm's name to comply with commission rules.

Material Fact Disclosure

Brokers must disclose material facts, even if selling their own properties as "For Sale By Owner."

Continuing Education for License Activation

Non-provisional brokers must complete 8 hours of continuing education before activating an inactive license.

Disclosure of Agency Status

Disclosure of agency status is required when certain first contacts occur, but showing a home does not necessitate it.

Material Facts in North Carolina

Synthetic stucco, even if removed, is considered a material fact that must be disclosed.

Dual Agency Notification

Sellers should be informed of the buyer's designated agent upon initial contact.

Real Estate Brochure Purpose

The Working with Real Estate Agents brochure clarifies the types of agency relationships in real estate transactions.

Agency Disclosure in Leasing

Commercial agents must use the agency disclosure brochure for sales transactions but not for leases.

Required Home Disclosure

Sellers of new homes must provide a Mineral and Oil and Gas Rights disclosure.

Buyer Agency Agreement Termination

A buyer agency agreement with a sole practitioner ends upon the practitioner's death.

Special Assessment Authority

Other homeowners in a neighborhood can levy special assessment fees by majority vote.

Title Status

A seller with an unquestionable ownership claim over ten years has a "clear" title.

Bequest Definition

Bequest refers to the process of leaving real property to heirs through a valid will.

Nonwarranty Deed Usage

A nonwarranty deed is commonly utilized during the resolution of interests in a marital home during divorce.

Valid Deed Requirements

A valid deed must include delivery and voluntary acceptance by the grantee.

Land Use Regulation

Public regulations of land usage oversee subdivision plans.

Seeking Variance for Parking

Property owners needing more parking spaces should seek a variance to accommodate their business needs.

Environmental Concerns

Radon is an odorless, colorless gas that poses lung cancer risks.

Lead-Based Paint Concerns

Properties built before 1978 are potential targets for lead-based paint assessments.

Asbestos Risks

Asbestos is considered an environmental concern due to its ability to become airborne and cause lung diseases.

Dual Agency Disclosure Timing

Firms must disclose and obtain consent for dual agency before acting in such capacities.

Creating Agency Relationships

The payment of money does not create an agency relationship on its own.

Special Agency Description

A special agency relationship is when an agent performs specific tasks like marketing a property sale.

Buyer Client Obligations

Agents must advise clients on negotiating strategies when crafting offers.

North Carolina Property Disclosure Act

Agents are responsible for informing buyers and sellers of their rights and obligations under this act.

Subagent Role

If a listing firm cooperates with another broker who lacks buyer agency consent, they act as a subagent.

Listing Agent Duties

Listing agents must notify sellers about ongoing offers and their impact on negotiations.

Information Duty for Buyer Agents

Buyer agents have a duty to disclose information that could weaken their client's position.

Property Management Agency Type

Property managers typically operate under general agency due to their broad authority over tasks.

Offer Requirements

An offer becomes valid and binding only when signed by all parties and communicated.

Commission Rate Policies

A brokerage maintains the right to refuse commission rate reductions regardless of a seller's request.

All-Risk Insurance Policy

An HO-3 policy covers structures and personal property for various hazards, meeting lender requirements.

CLUE Report

A CLUE Report details insurance claims made against a property and is often used by brokers during transactions.

Leasehold Interest

A tenant with a lease that requires a 60-day notice to vacate likely has an estate from period to period.

Intangible Appurtenance

HOA covenants exemplify intangible appurtenances that run with the land.

Real Property Ownership Benefits

Advantages of owning real property include favorable tax treatment.

Joint Tenants Ownership

Upon Russell's death, his property share passed to Nancy and Jed under joint tenancy laws.

Special Assessment Fee Authority

Only other homeowners in the area typically have the authority to impose special assessments.

Clear Title Definition

A clear title indicates unquestioned ownership over real property.

Will and Bequest

Bequest describes the process of transferring property to heirs as per a deceased’s will.

Nonwarranty Deed in Divorce

During property division, a nonwarranty deed may be used for transferring ownership in a marital home.

Valid Deed Requirements Recap

Valid deeds require both delivery and voluntary acceptance by the grantee for legality.

Land Use Public Regulation

Subdivision plans fall under the oversight of public land use regulations.

Variance for Business Needs

Property owners may request a zoning variance when needing additional space for business operations.

Health Risk from Radon

Radon, an invisible gas, poses serious health risks, especially lung cancer.

Lead Risk in Older Homes

Properties constructed before 1978 should be screened for potential lead-based paint exposure.

Asbestos Health Hazard

Asbestos can cause severe lung diseases when disturbed, releasing harmful particles into the air.

Firms must disclose dual agency commitments and acquire necessary consents beforehand.

Agency Formation Misconceptions

Financial transactions alone do not establish an agency relationship without additional context.

Nature of Special Agency

Special agency agreements restrict an agent to specific tasks, primarily related to property sale or purchase.

Agent Responsibilities

Agents should provide thorough advice to clients, especially regarding negotiating strategies.

Compliance with Property Disclosure Act

Duty includes educating clients on their rights and responsibilities as outlined in property law.

Role of Subagent Clarification

Subagents operate under the direction of a listing firm without buyer agency consent, fulfilling commission roles.

Notification Duties of Listing Agents

Agents are obligated to communicate any significant offers to sellers promptly.

Buyer Agency Obligations

Agents must inform buyers of any vulnerabilities relating to their contract position.

Classification of Property Managers

The majority of property managers function under general agency due to their expansive responsibilities.

Offer to Purchase Validity

Contracts only become binding upon both parties’ signatures and proper communication.

Commission Agreement Policies

Agents can set policies regarding commission reductions despite client's requests.

All-Risk Insurance Description

All-risk coverage under an HO-3 policy fulfills lender coverage requirements for structures and contents.

Insurance Claims Report

CLUE Reports provide insight into past claims against a property and are essential in real estate transactions.

Lease Terms Classification

Tenants with a two-month notice requirement likely possess an estate governed by periodic leases.

Example of Appurtenances

Intangible appurtenances like HOA restrictions are legally tied to property ownership.

Real Estate Ownership Advantages

Homeownership can deliver substantial tax benefits.

Ownership Changes After Death

Joint tenancy allows Russell's shares to pass directly to Nancy and Jed upon his passing.

Authority for Special Assessments

Typically, it is fellow homeowners within a neighborhood who have the ability to enforce fees.

Title Legitimacy

A clear title reflects an owner’s verifiable and uncontested claim to the property.

The term 'bequest' is specifically used to describe property transferred through a will.

Nonwarranty Deed During Divorce

Couples may utilize a nonwarranty deed to transfer sole ownership of a shared home amid divorce proceedings.

Deed Validity Essentials

Fundamental requirements for a deed's validity encompass voluntary acceptance and delivery to the rightful party.

Usage of Land Plans

Public oversight governs the regulations surrounding land including subdivision layouts.

Variance Requests for Business Operations

Owners facing logistical challenges often file for variances to secure necessary operational adjustments.

Risks Associated with Radon Exposure

Given its odorless nature, radon poses significant health risks, particularly linked to lung cancer.

Assessing Lead in Older Properties

Properties built prior to 1978 are potential candidates for lead paint inspections and risk assessments.

Asbestos and Health Risks

Asbestos creates major public### Transaction Status
Offer made for property at 101 Jones Ferry Avenue on April 10.
B’s agent delivered signed offer to seller on April 11.
B accepted A's offer by signing the document.
A withdrawn offer on April 11 via email to A’s agent.
A’s agent left voicemail for B’s agent regarding withdrawal, which B’s agent did not receive.
Signed document delivered to A’s agent by B’s agent on April 12, after A's withdrawal.

Statute of Frauds

Law stipulating contracts to convey real property must be in writing to be enforceable.

Termination of Sales Contract

A buyer's inability to secure specific loan can lead to contract termination.
Identifying factors that may not result in termination is crucial.

Liquidated Damages

Buyers and sellers believe the other has breached a purchase contract.
Liquidated damages may be a potential remedy for breaches.

Parole Evidence Rule

A buyer included a washer and dryer in an initial offer, which was conceded in a counteroffer.
By omitting mention of the washer and dryer in the final counteroffer, it explains why the seller retained them post-closure.

Multiple Offers Strategy

Seller under Exclusive Right to Sell listing should NOT advise the broker to counter each offer at the highest price.

Contract for Deed

True statement: it serves as both a contract to convey real property and a financing instrument.

Buydown

Refers to a situation where a builder prepays interest to lower loan interest rates temporarily in early years.

Lien Theory vs. Title Theory

In Lien Theory, borrower gets title at closing.
In Title Theory, borrower gets equitable title at closing.

TRID Regulations

Lender must provide Closing Disclosure at least 3 business days before settlement if delivered electronically.

Advertising Trigger Terms

Example of trigger term: terms that indicate specific payment amounts or rates.

VA Loans

Lenders can issue loans above the Certificate of Reasonable Value under certain conditions.

FHA 203b Clause Restrictions

Due on Sale Clause not permitted in an FHA 203b mortgage loan.

Common Promissory Note Clauses

Voluntary alienation clause is among common clauses in promissory notes.

Financing Statements

VA loans are recognized for having the highest loan-to-value ratios compared to FHA and conventional loans.

"Subject To" Loans

Method of financing where the seller remains responsible for mortgage payments despite the sale.

Print Advertisement Regulations

Any marketing statement that involves specific low monthly payments must disclose all material terms of the loan.

Equal Credit Opportunity Act

Borrowers on public assistance are afforded protections under this act against discrimination.

Sales Comparison Approach Adjustments

To adjust for square footage, subtract the difference in value between subject property and comparable property.

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