Cal-Real Exam 1.docx

**California Real Estate Salesperson Practice Exam 1** **Total Questions: 150** 1. **Which of the following is considered real property?** 2. **Agent rates of commission on sales of real property are** 3. **Which is the usual method for commercial property valuation?** 4. **Which of the fol...

**California Real Estate Salesperson Practice Exam 1** **Total Questions: 150** 1. **Which of the following is considered real property?** 2. **Agent rates of commission on sales of real property are** 3. **Which is the usual method for commercial property valuation?** 4. **Which of the following does NOT warrant that the seller owns the property?** 5. **The 1968 Fair Housing Act as amended EXEMPTS which of the following?** 6. **Real property is NOT characterized by which of the following?** 7. **There are several methods to legally describe land in California for purposes of sale, lease, or financing. Which of the following methods is NOT legal?** 8. **The U.S. Government Survey method uses which descriptors to identify property?** 9. **Public controls of real estate and its uses is a police power of the state derived from which source?** 10. **The exercise of littoral rights pertains to the use of** 11. **The next section number located just south of Section 33 in T4N, R3E Humboldt Base Line and Meridian is** 12. **A monetary encumbrance on land is known as** 13. **A deed of trust filed at the county recorder's office is an example of which of the following?** 14. **The ownership "bundle of rights" includes** 15. **Mineral rights in the land pertain to all of the following EXCEPT** 16. **Ownership of personal property is transferred with which of the following?** 17. **A custom-made bookcase in a bookstore is an example of personal property when it** 18. **Covenants, conditions, and restrictions (CC&Rs) are** 19. **Which of the following is an example of personal property (as opposed to real property)?** 20. **A single individual who has never been married would most commonly hold title in real estate in which of the following?** 21. **The California Coastal Commission regulates California property boundaries located along the Pacific Ocean. Property boundaries are set by which of the following?** 22. **The presence of lead-based paint in homes or condominiums built before 1978 is:** 23. **The government reserves the right of eminent domain according to the 5th Amendment of the U.S. Constitution to take private land for public use. An example of the taking of property for public use would include which of the following?** 24. **A property owner has a lake existing completely within the property boundaries. The property owner has what rights to the water in the lake?** 25. **One acre of land is a common measurement in rural areas. An acre of land equals which of the following?** 26. **Is a 50-gallon solar water heater, costing \$2,000 and requiring hours for installation, considered a fixture and therefore real estate?** 27. **Administration of the Subdivided Lands Act is the responsibility of which of the following?** 28. **A couple purchases a home together one week before their marriage. They may not hold title to the property in which of the following?** 29. **A seller executes a grant deed to a buyer but does not record the document at the county recorder's office. This real estate sale and property transfer is:** 30. **A life estate interest in real property is in effect for the remainder of the:** 31. **Which of the following is not a basic type of promissory note used to evidence a debt?** 32. **Which of the following financial terms is never expressed as a percentage?** 33. **Examples of negotiable instruments include all except which of the following?** 34. **A married man, James, buys a \$300,000 condominium in Palm Springs. He secures a \$250,000 fully amortized, 30-year loan from a mortgage broker. He pays the broker 1 point to reduce the interest rate to 2.654%. How much does James pay the broker?** 35. **Margaret Byer (vendee) has no down payment and is unable to secure a loan to purchase a house and barn on five acres. Carol Rivera (vendor) agrees to finance Margaret's purchase using a land contract with a 20-year term. When will Margaret acquire title to the property?** 36. **The Truth in Lending Act (TILA) is a federal law as administered by the Federal Reserve (Regulation Z). It requires its lenders make certain disclosures to which of the following type(s) of borrowers?** 37. **CalVet home loans and private sales contracts (land contracts) have one thing in common. What is it?** 38. **There are three main types of lenders that finance real estate transactions. What kind of lender is fictional Donald Duck's rich uncle, Scrooge McDuck?** 39. **A deed of trust is:** 40. **All licensed and registered mortgage loan originators (MLOs) in California may set their commissions:** - **In accordance with the California Business and Professions Code.** 41. **In California, mortgage loan brokers can be licensed by which of the following?** **D. all of the above (**the Department of Business Oversight (DBO), the Department of Real Estate (DRE), the California Finance Lenders (CFL) 42. **Which of the following is used in California that makes real property collateral for a promissory note?** 43. **The greatest level of title insurance coverage is associated with which type of policy?** 44. **California Proposition 13:** 45. **The four unities of time, title, interest, and possession must be concurrent for parties to hold which of the following types of titles?** 46. **Who can act as an agent when the buying and selling parties have agreed to an escrow for handling the paperwork and funds in a real estate transaction?** 47. **It is common for an escrow agent to prorate rents or property taxes as part of the escrow process. How many days is the basis of proration of monies?** 48. **"RESPA" is an abbreviation for an important law relating to the sale of one to four unit residential dwellings. "RESPA" stands for:** 49. **Which of the following is NOT a method of transferring real estate title?** 50. **Individual California taxpayers can expect to pay income taxes on monies received from:** 51. **Real estate commission for a property that is in probate is set by:** 52. **Which of the following requires probate taxes and court costs including attorney's fees?** 53. **"Escheat" is the term that most closely relates to what process?** 54. **The underlying premise for all real estate property valuation is:** 55. **The cost approach, also known as the replacement cost method, is most often used to value property for what purpose?** 56. **Real Estate Appraisers are licensed by the:** 57. **The comparison approach (market data approach) is commonly used to value which of the following?** 58. **When do licensed real estate agents perform appraisals for home sellers?** 59. **In order for an appraisal report to comply with BREA guidelines, it must contain all of the following EXCEPT:** 60. **Commercial property is valued by:** 61. **The proverb "A bird in the hand is worth two in the bush" is most closely associated with which financial concept?** **The time value of money** 62. **Simple interest as expressed in dollars earned on an investment can be calculated using which of the following formulas?** - **P \* R = I** 63. **The Truth in Lending Act requires all consumer, home loan, and refinance loan interest rates be published as:** **Annual percentage rate (APR).** 64. **California's usury statute restricts the amount of interest that can be levied on any loan by a non-exempt lender to what annual interest rate?** **Ten percent rate** 65. **A financial analysis of the future cash flows from an investment property can be found on:** **A pro forma cash flow report.** 66. **What does "simple" mean in the term "simple interest?"** **It does not take the time value of money into the equation.** 67. **An individual invests \$1 million in a \$4 million dollar bottling plant and secures a 10-year, triple-net lease from a beverage company. Annual gross rents are \$500,000 per year. Using the payback method, how long will it take for the individual to get the invested money back?** **Two years** 68. **A "seller's market" occurs when prices for real estate rise due to:** **An increasing demand for real estate purchase or rent.** 69. **Conventional lenders look carefully at loan to value (LTV) ratios when considering the security for a new owner-occupied home loan. Other matters being equal, which of the following ratios would make a loan on an owner-occupied residential dwelling most attractive?** **0.8:1** 70. **Jessica has a \$250,000 30-year fully amortized loan at 4.25% secured by deed of trust. The loan was acquired to purchase her personal residence, where she has lived for 15 years. Jessica notices that interest rates on refinance loans have dropped to 2.85%. What should she do?** **Consider refinancing the remaining principal balance with a 15-year fully amortized loan to reduce her monthly payments** 71. **The "4 C's" of qualifying for a real estate loan include all of the following EXCEPT:** **Character** 72. **Of the following institutional lenders, which has the greatest money available to lend for real estate--secured loans?** **Life insurance companies** 73. **Government-backed loans such as the Federal Housing Administration (FHA), U.S. Department of Housing and Urban Affairs (HUD), and U.S. Veterans Affairs (VA):** **Insure and guarantee loans.** 74. **A "4-3-2-1 depth table" would indicate what percentage of the value of the property is located in the front part of the parcel. This would apply to which of the following?** **Lake-front property in Lake Tahoe** 75. **The mudsill is what part of conventional construction?** **C. the treated lumber or plate through which the building is bolted to the foundation** 76. **An option agreement requires a minimum of how much value (money) to bind the contract?** **A nickel** 77. **Transfer of real property between parties must legally describe the property and the parties to the transfer of title in which of the following ways?** **On paper** 78. **Can a married person who has acquired sole and separate real property transfer the title without their partner's consent?** **No** 79. **Licensed California real estate brokers may buy and sell promissory notes:** **With a special Department of Real Estate license endorsement.** 80. **The real estate listing agreement is:** **The personal property of the broker.** **81. Dual agency agreements are** **82. Elements of a real estate contract include all of the following EXCEPT** **83. May a non-emancipated minor own and enter into a contract to sell real estate?** **84. Liquidated damages are limited to which of the following?** **85. Buyer and broker agreements include all of the following EXCEPT a(n)** **86. What is the duration of a Residential Listing Agreement (Exclusive Authorization and Right to Sell)?** **87. May an agent request an advance fee?** **88. Those listings not published through the multiple listing service are known as "pocket listings" and are** **89. The California Residential Purchase Agreement and Joint Escrow Instructions are also known as the** **90. The listing agent is engaged by the seller to** **91. When may an agent pay a finder's fee to a licensed individual?** **92. Commissions earned by the procuring real estate listing agent for residential 1- to 4-unit dwellings are** **93. The Transfer Disclosure Statement (TDS) for 1- to 4-unit owner-occupied residential dwellings is** **94. The three steps of the agency disclosure law are all of the following EXCEPT** **95. A fiduciary relationship exists between all of the following EXCEPT** **96. The statute of frauds is a legal concept that states that all of the following must be in writing EXCEPT** **97. The California Law of Agency is entered into by an agent and principal** **98. The California Megan's Law disclosure** **99. When an agent is in doubt of a probable material fact, it is always prudent to** **100. Month-to-month lease agreements** **101. An agent may terminate the agency agreement** **102. Commingling an agent's personal funds with a client's funds** **103. A non-licensed agent acting as a principal's attorney-in-fact may** **104. Easton v. Strassburger is a landmark 1984 California Court of Appeals decision that** **105. A secret profit made by a licensed agent or a member of the agent's family** **106. If the seller in a real estate agreement unexpectedly dies, the listing agreement** **107. A licensed California real estate agent wishing to do business in Lake Tahoe may** **108. Errors and omissions insurance will cover which of the following errors in a real estate transaction?** **109. What type of media may be used by a licensed real estate agent to place a blind advertisement?** **110. Newly licensed sales agents may begin their new profession** **111. When does title transfer to the new property owner?** **112. Misrepresentation of a material fact on the Transfer Disclosure Statement by the seller's broker** **113. Agents must disclose their license number and broker affiliation on all of the following EXCEPT** **114. A licensed real estate agent's disclosure of agency relationship(s) may include any or all of the following EXCEPT** **115. Fiduciary duties of a real estate agent acting on behalf of a seller include all of the following except the duty** **116. The Wire Fraud and Electronic Funds Transfer Advisory (WFA) is** **117. The Department of Real Estate audit checks to see that the Exclusive Authorization and Right to Sell Agreement (RLA) includes a** **118. The Sellers Advisory (SA) form includes a recommendation that the seller** **119. The California Association of REALTORS® (CAR®) multiple listing service (MLS) is California's largest database and is key to** **120. Disclosure or discussion of affliction with AIDS or of an AIDS-related death in the property** **121. Impound accounts for property insurance and property taxes are often found in which real estate professional's accounting books of record?** **122. Broker trust accounts** **123. The obligation to prepare the mandated and necessary disclosures is the responsibility of** **124. The licensed broker of record has a legal duty to supervise** **125. The real estate broker examination** **126. The real estate broker and salesperson licenses require how many hours of continuing education for license renewal?** **127. Unlicensed sales associates are permitted to do which of the following at an open house?** **128. Natural hazard disclosures regarding the property may include which of the following?** **129. Property managers for non-residential, transient, or resort properties are** **130. Are real estate agents who manage their personal, owner-occupied 1- to 4-unit residential property exempt from the 1968 Fair Housing Act as amended?** **131. Which of the following statements about California residential property managers is true?** **132. Who must visually inspect a residential property before purchase?** **133. The "parol evidence" rule states that** **134. Real estate agents may engage in the business specialty of dealing in real property securities such as promissory notes and sales contracts upon** **135. Novation is the process whereby** **136. Owner sales representation of a business opportunity including the sale of an existing liquor license (personal property)** **137. A member of the National Association of Real Estate Brokers (NAREB) is referred to as** **138. Digital real estate forms and contracts are** **139. Do commercial and industrial properties have the same consumer protection disclosure requirements as residential, owner-occupied 1- to 4-unit dwellings?** **140. Electronic signatures using computer software tools such as DocuSign® are** **141. "Puffing" is when a real estate agent describes a** **142. The Unruh Civil Rights Act prohibits** **143. The real estate recovery fund is** **144. Licensed real estate brokers must retain all their agency records for a minimum of** **145. The California Department of Real Estate** **146. The Department of Real Estate audits focus primarily on which sector?** **147. A pre-paid rental listing service (PRLS) as licensed by the Department of Real Estate provides** **148. The public report issued by the Department of Real Estate is a** **149. Is it adequate for a licensed real estate agent to conduct business in accordance with California state law?** **150. Residential lofts (zero-bedroom dwelling) are always considered**