ALABAMA REAL ESTATE FINAL

ALABAMA REAL ESTATE FINAL

EXAM STUDY GUIDE - 60 HOUR

COURSE ACT IONS AND

ANSWERS / SOLVED

Which of the following ways of specializing is common in the real estate brokerage business?

• By type of mortgage financing required
• By years of experience in the business
• By type of property
• By background of client ✔- C. By type of property

Which of the following is included in the legal concept of land?

• A corn crop
• A lake
• A felled tree
• An abandoned vehicle ✔- B. A lake

A property abuts a non-navigable stream. What does the property owner own?

• Land to the low-water mark
• Underlying land to the middle of the waterway
• Land to the high water mark

• All water to the middle of the waterway ✔- B. Underlying land to the

middle of the waterway A retailer installs special display counters to exhibit her products. At the end of the lease term, the retailer moves to another state, leaving the counters in the store.At this point the counters are considered which of the following?

• Trade fixtures, and therefore real property
• Trade fixtures and therefore personal property
• Real property, since the trade fixtures were abandoned
• Personal property that must be returned to the retailer ✔- C. Real

property, since the trade fixtures were abandoned How is a legal life estate created?

• By an owner's voluntary grant
• By operation of law
• Through the four unities
• Through a defeasible conveyance ✔- B. By operation of law

Which of the following is true of a homestead?

• A homestead interest can be conveyed by one spouse
• A homestead interest cannot be exempt from creditors
• A homestead interest is a form of legal life estate
• A homestead is any privately owned single-family residence ✔- C. A

homestead interest is a form of legal life estate Three people have identical rights in a property, share an indivisible interest, but may sell or transfer their interest without consent of the others. This type of

ownership is:

• joint tenancy
• tenancy by the entireties

• estate in severalty
• tenancy in common ✔- D. tenancy in common

A condominium estate is distinguished by:

• Ownership of a share in an association and a condominium lease on the owned

unit

• Tenancy in common interest in airspace and common areas of the property
• Fee simple ownership of a unit and undivided share of the common areas
• Fee simple ownership of an equal share of the entire property ✔- C.

Fee simple ownership of a unit and undivided share of the common areas

An easement by prescription requires that:

• the use be continuous, known, and permitted by the owner for a period of time
• the use by continuous, open, and hostile for a required period of time
• the owner of an adjoining property be landlocked
• the owner of the affected property be and adverse possessor ✔- C. the

owner of an adjoining property be landlocked

In a lien-theory state:

• Liens are recorded in trusts as opposed to title records
• the lender records a lien while the borrower retains title
• liened properties are foreclosed by strict foreclosure
• trustees retain title during a mortgage period ✔- B. the lender records

a lien while the borrower retains title Five liens have been recorded against a certain house in the following order: first mortgage, mechanic's lien, second mortgage, real estate tax lien, special assessment lien. Which lien will be the last one to be paid from the proceeds of the sale of the house?

• Special assessment lien

• Mechanic's lien
• Second mortgage lien
• Real estate tax lien ✔- C. Second mortgage lien

For a conveyance by deed between private parties to be valid, the deed must be

• warranted by the grantor
• recorded by the grantee
• signed by the grantee
• accepted by the grantee ✔- D. accepted by the grantee

If a person dies with legal heirs and has left no valid will, what happens to the real property owned by that person?

• It is taken by the state according to the process called escheat
• It is probated according to the terms agreed to by the heirs
• It is probated and passes to the heirs by laws of descent
• It is conveyed to the highest bidder at a public auction ✔- C. It is

probated and passes to the heirs by laws of descent A miner openly lives and prospects on a 20,000 acre ranch. After twenty years, the owner notices the miner and kicks him off the property. The miner makes a claim of ownership to the property. This claim will likely be

• upheld because the possession was not concealed
• declined in favor of an easement by prescription
• declined, because the occupancy period was insufficient
• declined since the owner was not aware of the possession ✔- A.

upheld because the possession was not concealed A tenant obtains a low rental rate for a building, but agrees to pay all operating expenses. This is an example of a

• Net Lease