NATIONAL PORTION OF REAL ESTATE PRACTICE EXAM Flashcards

NATIONAL PORTION OF REAL ESTATE PRACTICE EXAM Flashcards On a service property, (i.e. church, school), which approach to value is most reliable?Income approachSales comparison approachCost approachGross multiplier

Cost approachCost approach : replacement, reproduction,

depreciation Just before the close, the buyer noticed a broken window and a man-door hanging by one hinge in the detached garage, her inspector had missed these as he considered outbuildings as outside the scope of the inspection. What is the buyer's recourse?A. Seller must fix windowB. Buyer's responsibility because she had missed the inspection deadlineC. The inspector is at faultD. Buyer may terminate the agreement or negotiate the inspection deadline

• Buyer's responsibility because she had missed the

inspection deadline Emblements****WILL BE ON EXAM-emblements = crops. Belongs to the one who planted-personal property-does not transfer with the property unless excluded Rectangular survey / government surveyUses meridians, townships, ranges, tiers, and sections to locate land parcelsTownship has 36 sectionsSection- 640 acre or 1 mile by 1 mileAcre - 43,560 ft A tenant with disability would like to make reversible changes to the property that effect the structure. In this

scenario:A. The changes must be allowed, but only in an

apartment building that has more than 4 unitsB. The changes must be allowed as long as the tenant pays for itC. The tenant must get approval from the owner for any changeD. The landlord must pay for the changes to meet ADA regulations

• The changes must be allowed as long as the tenant

pays for it Contribution (increasing and decreasing) -value of improvement based on increasing or decreasing

return-increase: improvements ass more value than

cost-decreasing: improvements add less value than cost

Income approach (capitalization)Value based on income. Used on commercial and investment properties the produce income.**If property has rent, use income approach by the monthly or annual rentGRM x rent = ValueValue / rent - GRM A couple vacates their house and moves across town, turning their former home into a rental unit. Who may they discriminate against and still be within the guidelines of Federal Fair Housing Act?A. A Muslim college professorB.College studentsC. A single woman with childrenD. A legal Mexican immigrant College student

Conformity-value tends to move towards surroundings-regression:

value of over improved property declines-progression:

value of under improved property increases

A real estate agent does an open house for a fellow colleague. The listing is not hers. The potential buyers ask her questions about the property and the questions she does not know she says she will get back to themA.Implied agency was createdB. Express agency was createdC. No agency was createdD. She is not their agent No agency was created Adjustable-rate mortgage (ARM)Mortgage that does not have a fixed interest rate If conditions for purchase are included in a deed and these conditions are violated, what is the penalty?A. Penalty charges are to be assessedB. An injunction against further use of the propertyC. A court order enforcing compliance can be issuedD. The property may be returned to the original owner The property may be returned to the original owner

If a 17 year old signs a contract is the contract:voidable

Truth in lendingTIL, REG Z, Regulation Z, or the consumer Credit protection act - a law passed to help and protect consumers understand the true cost of borrowing money Leverageborrowed money is used to increase investment returns

Essential elements of valueSTUD:ScarcityTransferabilityUtilityDemand

A rectangular survey must include which of the following?A.TownshipsB. Metes and bounds measurementsC. Street addressesD. Lot and block number

• Metes and bound measurements

DEFINE:-Appurtenant Easement-Easement in

gross-Easement by necessity -dominate and service the tenement-utility easement.-owner of a landlocked property has no access to a public right of way such as a street The Internal Revenue code provides for tax-deferred

exchange only of:

• Residential propertyB. Commercial propertyC. Urban

propertyD. Like kind property**tax-deferred exchange = 1030

Building ordinances may specify and regulate:A. Use of

landB. ZoningC. Material used in plumbingD. Easements

• Material used in plumbing

Appurtenancessomething attached to the land or subordinate; an accessory A buyer made an offer to purchase a property. The owner responded with a counteroffer. While the buyer was reviewing the counteroffer, the owner received a better

offer. The owner can accept the second offer if:

• The owner withdraws the counteroffer before it is

acceptedB. The owner gives the first buyer notice that another offer was received and an opportunity to revise the bidC. The first buyer is informed, in writing, of the owner's intent to accept another offerD. It satisfies or exceeds all terms included in the counterofferA Economic Characteristics of Landscarcity, improvements, permanence of investment, area preference Net leasethe tenant pays rent plus expenses (utilities, taxes, special assessments); most common for commercial properties partially amortized loan"an installment loan under which monthly payments pay all of the interest due but not enough of the principal to fully pay off the loan at the end of the loan term. In such a case,

a balloon payment would be due at the end of the loan term." A tenant leased property and agrees to pay taxes and

insurance. This is a:A. Gross leaseB. Variable leaseC. Net

leaseD. Ground lease

• Net lease