Texas Real Estate Exam<\/p>\n\n\n\n
In order for a tenant to claim relief for constructive eviction:
the landlord must have intentionally withheld required repairs or maintenance<\/p>\n\n\n\n
A buyer purchases a furnished condominium apartment as an investment. The document that evidences the buyer’s ownership of the furniture is a:
bill of sale<\/p>\n\n\n\n
A broker who enters into a property management contract is considered a:
fiduciary<\/p>\n\n\n\n
A buyer’s interest in real property, acquired at the moment the seller and the buyer enter into a sales contract, is known as:
equitable interest<\/p>\n\n\n\n
The appropriate time for a selling broker to explain the agency relationship to a prospective buyer is:
at their initial meeting<\/p>\n\n\n\n
A broker is asked to lease 1,200 square feet of warehouse space at $6 per square foot per year. If the broker’s commission will be 8 percent of the first year’s rental income, the MAXIMUM amount payable is:
$576<\/p>\n\n\n\n
A geographic region in which similar properties compete with the subject property for potential buyers is called a:
market area<\/p>\n\n\n\n
In the absence of a formal appraisal report, which of the following choices is the MOST appropriate for setting a listing price in a new, rapidly selling neighborhood?
The price that willing buyers have recently paid for similar structures<\/p>\n\n\n\n
Which of the following factors would be included in the description of replacement cost?
Similar utility and current material<\/p>\n\n\n\n
Under an exclusive right-to-sell listing, a broker has the authority to take which of the following actions on behalf of a seller?
Advertise the property for sale.<\/p>\n\n\n\n
Under a lease for a commercial property, a tenant agrees to pay $4,000 per month plus 3% of the gross monthly sales. This type of lease is called a:
percentage<\/p>\n\n\n\n
The agency that is charged with enforcing the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) in the case of an owner who allows the dumping of wastes on a property is the:
Environmental Protection Agency<\/p>\n\n\n\n
A percentage lease would MOST often be used for tenants in:
a shopping center<\/p>\n\n\n\n
A license holder is showing a home built in 1972 to buyers who notice paint flaking on the woodwork. How should the license holder proceed?
Advise the prospective buyers to get a lead-based paint inspection.<\/p>\n\n\n\n
A lot was purchased as an investment for $10,500 and sold a year later at a loss of 20%. If the owner paid a 10% commission, what was the owner’s net loss on the sale?
$2,940<\/p>\n\n\n\n
A broker lists a property. A potential buyer tells the broker that he has heard that the crime rate in the neighborhood is increasing. Which of the following is the broker’s BEST response to the buyer?
Check with local law enforcement authorities about the crime rate.<\/p>\n\n\n\n
Which of the following statements about the law of agency is CORRECT?
a. It refers specifically to insurance.
B. It establishes a fiduciary relationship.
c. It does not require a high degree of loyalty and fidelity from an agent.
d. There is no employment relationship.<\/p>\n\n\n\n
A lender’s title policy will protect the:
lender against existing, undiscovered title defects<\/p>\n\n\n\n
The provision in a mortgage or deed of trust that gives the lender the rights to call the entire balance due upon a default in any payment is called a(n):
acceleration clause<\/p>\n\n\n\n
In order for a property manager to determine net operating income on a property, which of the following fees is subtracted from the effective gross income?
Operating expenses<\/p>\n\n\n\n
The value placed on land and buildings by a governmental unit for use in levying annual real estate taxes is called the:
assessed value<\/p>\n\n\n\n
If a buyer makes a 20% down payment and obtains a $75,000 mortgage, what is the sales price of the property?
$93,750<\/p>\n\n\n\n
A special warranty deed provides:
protection against defects that occurred while the grantor held title<\/p>\n\n\n\n
Which of the following acts is illegal under Federal Fair Housing law?
Advertising property for sale only to members of a specific national origin<\/p>\n\n\n\n
A loan that provides for increases and decreases in the interest rate during its term is known as a(n):
adjustable-rate mortgage<\/p>\n\n\n\n
The right of local government officials to acquire title to real estate for public purposes by condemnation is based on the power of:
eminent domain<\/p>\n\n\n\n
The price for which a property will sell if offered openly under normal conditions is known as:
market value<\/p>\n\n\n\n
The condition which allows a property owner to convey a right to another party while retaining full legal title is a(n):
easement<\/p>\n\n\n\n
The acquisition of another’s title to real property by means of open, notorious, and continuous use is known as an:
adverse possession<\/p>\n\n\n\n
The commission earned by a listing broker on a sale of property is established by:
Agreement between the seller and the broker<\/p>\n\n\n\n
Ifafree-standingapplianceissoldseparatelyfromareal estate transaction, the seller should furnish the buyer with a:
bill of sale<\/p>\n\n\n\n
In order for a brokerage to be able to represent both the buyer and seller in a real estate transaction, the brokerage needs to have the permission of:
both parties<\/p>\n\n\n\n
G borrowed $15,000 to buy a business. The interest
rate was 11%. If G paid all the interest and the amount borrowed with a single payment at the end of 16 months, what is the amount of this payment?
$17,200<\/p>\n\n\n\n
Which of the following types of developments allows fee ownership of individual units with joint ownership of common areas?
Condominiums<\/p>\n\n\n\n
An unimproved lot is located in the service area of a water supply corporation. The seller is subject to the notice requirements relating to a service provider. What is the buyer’s statutory remedy if the seller fails to give the written notice REQUIRED by law?
Terminate the purchase contract with the seller.<\/p>\n\n\n\n
To be eligible for a real estate license, an individual MUST:
satisfy the Commission as to the individual’s integrity<\/p>\n\n\n\n
Who can pay money to a licensed salesperson to perform sales activities for a house a broker has listed for sale?
The salesperson’s sponsoring broker and no one else.<\/p>\n\n\n\n
According to The Real Estate License Act of Texas, which one of the following actions is a fair and impartial act for an intermediary?
Appointing associated licensees to work with the parties.<\/p>\n\n\n\n
As a marketing promotion, a real estate salesperson offers property for sale by lottery. This practice is:
grounds for suspension or revocation of license<\/p>\n\n\n\n
When the association of a salesperson with the sponsoring broker is terminated, the broker MUST:
immediately return the salesperson’s license to the Commission<\/p>\n\n\n\n
When negotiating contracts binding the sale or lease of property, a real estate licensee MUST use an appropriate Texas Real Estate Commission-promulgated form
unless another contract form has been prepared and is REQUIRED by the:
owner of the property<\/p>\n\n\n\n
An individual is exempt from real estate licensure in Texas when performing which one of the following activities?
Offering an employer’s property for rent.<\/p>\n\n\n\n
Absent an agreement, spouse’s rental income from separate property is:
community property<\/p>\n\n\n\n
Who is responsible to the Texas Real Estate Commission, the public, and the clients for the acts of a salesperson?
Salesperson’s sponsoring broker<\/p>\n\n\n\n
A buyer contracts to purchase a previously occupied single-family residence. The buyer did NOT receive a copy of the Seller’s Disclosure Notice before signing the contract. According to the Texas Property Code, the buyer has the right to:
terminate the contract within 7 days after receiving notice<\/p>\n\n\n\n
Combining a principal’s funds with the licensee’s personal funds is:
considered to be commingling<\/p>\n\n\n\n
When MUST an existing agency relationship be disclosed to another party to a proposed transaction?
At the time of licensee’s first contact.<\/p>\n\n\n\n
A standard contract form has been developed for:
sale of single-family residences<\/p>\n\n\n\n
What information is in the written statutory statement that a licensee MUST provide for a consumer at their first face-to-face meeting?
Duties of the broker representing one of the parties or acting as an intermediary.<\/p>\n\n\n\n
A single woman dies intestate. In regards to her surviving heirs, her property will:
be distributed according to the law of descent and distribution<\/p>\n\n\n\n
Police Power
Government right to regulate and control the character and use of property for the health, safety and general welfare of the public<\/p>\n\n\n\n
Zoning
Local laws to control land use<\/p>\n\n\n\n
Master plan
Comprehensive guideline for the long term physical development of a particular area mixed land is designed to meet the needs of the future residents<\/p>\n\n\n\n
Non-conforming use
A permissible use under former rules that is now prohibited – automatically granted when zoning regulations change<\/p>\n\n\n\n
Variance
Permission to violate current regulations – obtained by a hearing<\/p>\n\n\n\n
Buffer zone
An area of land separating one land use from another incompatible use such as residential from commercial<\/p>\n\n\n\n
Building codes
Regulations regarding specific construction requirements- plumbing, electrical, etc.<\/p>\n\n\n\n
EIS
Environmental impact statement- a study done to determine the effect of a proposed project on a community<\/p>\n\n\n\n
Eminent domain
The right of government to take private property for public use<\/p>\n\n\n\n
Condemnation
The action of the government I taking private property under the right of eminent domain<\/p>\n\n\n\n
Inverse condemnation
The action of an individual trying to force the government to buy his property<\/p>\n\n\n\n
Taxation
The right of government to tax real property<\/p>\n\n\n\n
Ad valorem
According to value- real property taxes are ad valorem taxes<\/p>\n\n\n\n
Assessed value
Property value for tax purposes- (tax rate*assessed value= tax)<\/p>\n\n\n\n
Mill
A tax rate per $1000.00 (assessed value\/1000*mills=tax)<\/p>\n\n\n\n
Assessment Rolls
Books showing the assessed value of all properties in the tax district<\/p>\n\n\n\n
Special Assessment
A tax levied against only those property owners who benefit from a government improvement such as curbs or sidewalks<\/p>\n\n\n\n
Municipal improvement district
An area within a municipality that is taxed for a specific improvement- unlike a special assessment, property owners were permitted to vote for the improvement district to be created<\/p>\n\n\n\n
Escheat
The right of the government to take real property if an owner dies without a will and with no heirs or no kindred<\/p>\n\n\n\n
Riparian rights
The right to use water from a river or stream that borders a property<\/p>\n\n\n\n
Littoral rights
The right to use water from a lake or ocean that borders a property<\/p>\n\n\n\n
Prior Appropriation
A theory of water law stating the first landowner to claim riparian rights has the exclusive right to take all the water for specific beneficial uses<\/p>\n\n\n\n
Appropriative rights
Water rights under prior appropriation<\/p>\n\n\n\n
C, C & R’s
Deed covenants, conditions and restrictions are private controls of land use, development, methods and materials for construction, including style and appearance requirements in some cases<\/p>\n\n\n\n
Declaration of Restrictions
The recorded document outlining the c,c &r’s for a particular area of land<\/p>\n\n\n\n
HOR Regulations
Deed restrictions for condominium complexes<\/p>\n\n\n\n
Injunction
A court order to cease, stop, or refrain from acting- can be used to enforce c,c &r’s<\/p>\n\n\n\n
Real Property
Land, improvements attached to the land, and the rights to use them<\/p>\n\n\n\n
Personal Property
Anything not classed as real property, a right or interest in things of a temporary or moveable nature<\/p>\n\n\n\n
Chattel
Personal property<\/p>\n\n\n\n
Personalty
Personal property<\/p>\n\n\n\n
Fixture
Personal property that has been installed or attached to become real property<\/p>\n\n\n\n
Annexation
The process of attaching personal property so that it becomes real property thus creating a fixture<\/p>\n\n\n\n
Severance
Real property becomes personal property when it is “severed” from the land. Uninstall, unattach<\/p>\n\n\n\n
Trade Fixture
Personal property installed on leased property for the purpose of the tenants occupation or profession<\/p>\n\n\n\n
Accession
Gaining title to improvements as a result of the annexation of fixtures<\/p>\n\n\n\n
Physical Charateristic of Land
Nonhomogeneity, immobility, indestructibility<\/p>\n\n\n\n
Nonhomogeniety
A physical characteristic of land stating no two pieces are exactly alike<\/p>\n\n\n\n
Immobility
A physical characteristic of land stating that land cannot be moved- an owner must go to the land<\/p>\n\n\n\n
Indestructibility
A physical characteristic of land stating that the land will always be there- it is durable<\/p>\n\n\n\n
Economic Characteristics of Land
Scarcity, modification, fixity and situs<\/p>\n\n\n\n
Scarcity
An economic characteristic of land stating that a short supply where demand is great will cause an increase in value- usually based on geography<\/p>\n\n\n\n
Modification
An economic characteristic of land stating that improvements made by man will alter the value of the land and surrounding properties<\/p>\n\n\n\n
Fixity
An economic characteristic of land stating that land, buildings and improvements are considered a fixed investment- not liquid assests<\/p>\n\n\n\n
Situs
An economic characteristic of land stating that location preference from an economic standpoint can cause increased value- location, location, location<\/p>\n\n\n\n
Legal description of property
A description of such certainty and accuracy that one can go to the ground and identify the land- a description prepared by a surveyor<\/p>\n\n\n\n
Metes and bounds
A legal description of land having a point of beginning, using terminal points and angles, degrees and minutes to outline a property<\/p>\n\n\n\n
Lot, Block and Subdivision
A legal description of land based on a recorded map of a subdivision called a plat<\/p>\n\n\n\n
Monuments
Permanent surveyor marker- natural or manmade<\/p>\n\n\n\n
Rectangular Survey System
A legal description of land using base line, meridians, townships, sections and ranges- also called the Government Survey System<\/p>\n\n\n\n
Government Survey System
A legal description of land using base lines, meridians, townships, sections, and ranges- also called the Rectangular Survey System<\/p>\n\n\n\n
Township
Part of the Government Survey System consisting of 36 sections<\/p>\n\n\n\n
Section
Part of he Government Survey System consisting of 640 acres or one square mile<\/p>\n\n\n\n
Acre
A measure of land- 43560 square feet<\/p>\n\n\n\n
Plat
A map of a town, section or subdivision<\/p>\n\n\n\n
Plot
A map of a single property site, also called a lot or a parcel<\/p>\n\n\n\n
Lot
A map of a single property site, also called a plot or a parcel<\/p>\n\n\n\n
Parcel
A single piece of property site, also called a lot or a plot<\/p>\n\n\n\n
Onsite construction
Improvements constructed or built on the land- not prefabricated<\/p>\n\n\n\n
Offsite construction
Improvements constructed or built in a controlled environment and then transported to the land and installed on the land- prefabricated, manufactured or modular buildings<\/p>\n\n\n\n
Encumbrance
A limitation on the rights of a property owner<\/p>\n\n\n\n
Cloud on the title
An encumbrance that causes doubt as to the validity of title and can prevent sale or transfer of title<\/p>\n\n\n\n
Release
The legal method of removing an encumbrance- to release it or get a release<\/p>\n\n\n\n
Lien
A charge against property as security for a debt<\/p>\n\n\n\n
Voluntary lien
A lien created by the borrowers choice- taking out a mortgage or home improvement loan<\/p>\n\n\n\n