Real Estate Final Exam 150 Questions 1 Flashcards

Real Estate Final Exam (150 Questions ) #1 Flashcards The Rose family owns a home in a semi-rural area, which is about five years old. Recently announced plans for a new regional airport will place their home directly in line with a main runway ending 1 mile before their home. If the airport is constructed, will this diminish the value of the Rose Home?Yes, because of economic obsolescence.Discrimination is prohibited in lending practices underECOA A recorded subdivision plat is used in the lot and block system.On a $500,000 loan the borrower is required to pay two points. How much does the borrower have to pay the lender?

$510,000.00

An owner was selling his own home. Can he advertise the down payment?Yes, because it was his own home.

• What is an arm's length transaction?One in which both parties have the ability to negotiate.

Which of the following is true of a second mortgage?It is usually issued at a higher rate of interest.Which best describes why a buyer purchases a home using the market data approach?Buyers buy after they compare the house with others.Though 30 year loans are more common, 15 year loans are considered standard, conventional loans.Yes.A house sold for $420,000. The buyer made a 20% down payment. Monthly interest on the loan was $1,400. What was the interest rate on the loan?5% Are there any state-mandated qualifying requirements for conventional loans?No, Not only are guidelines not uniform, qualification standards can vary enormously from lender to lender.A tenant leased 3,000 square feet at $10 per square foot and 8% of gross income. The total annual rent she paid was $60,000. What was the gross income on which she paid percentage rent?

$375,000

Which is true about restrictive covenants? They are placed by private parties in a deed.If a single parent is applying for a real estate loan, when would the fact have to be revealed that part of the parent's income is from child support?If the parent was relying on the income for repayment of the loan

• The seller and the buyer finally agreed to a purchase

price of $203,500 with the closing to occur on June 15. The taxes for the year in the amount of $2,500 have not been paid by the seller. (Taxes are paid in arrears). How much would the tax proration amount to, and how would it appear on a full settlement statement? Base your answer on a 365 day year, and the buyer is responsible for the day of settlement.$1,130.14 debit the seller and credit the buyer

If advertised alone, which would be in violation of Truth in Lending?"No down payment required."

• Broker Carr, with ABC Real Estate Company, listed the

property with a seller. Broker Smith, with XYZ Real Estate Company, called Broker Carr, and disclosed that he was a Buyer Agent. Broker Smith wrote a contract with a buyer for the sale of the property. What, if any, is the relationship between the buyer's broker, the seller and the listing broker?There is not a relationship between the parties. Broker Carr represents the Seller and Broker Smith represents the Buyer.Looking at shopping centers in the appraisal process, the social fiber of the community and distances from schools is called neighborhood analysis.Why is the RESPA closing statement allowed to be examined on or before closing?To check for mathematical errors The primary purpose of Truth in Lending is to disclose the true costs of obtaining credit.When can a landlord evict a disabled blind or disabled tenant from the premises?If the tenant has loud parties, makes too much noise, and is constantly disturbing other tenants In doing a market analysis, an appraiser found a recently sold property where the owners had just gone through a divorce. The property had been listed for $260,000 for 3 months but was purchased for $170,000 by one of the spouses. Should the appraiser use this as a comparable?No--because of the divorce it was not an "at arms' length" transaction.A buyer wanted to use a promissory note for consideration on the purchase of a property. Can he do this?Yes. This is acceptable as long as the seller agrees.A VA loan may be granted for the purchase of a one-family to four-family property if the veteran agrees to live there.What does Fannie Mae stand for?Federal National Mortgage Association The Adams family purchased the largest and most expensive house in a new subdivision. Five years later, when they were ready to move, they discovered the monetary value of the home had gone up proportionately less than the other houses in the neighborhood. This phenomenon is an example of the principle of regression.Which of the following would usually occur in a sale-and-leaseback transaction?The property is sold on the condition that the new owner lease it back to the seller at the time title passes.An appraiser is usually paida fee based on the amount of time and effort.How does one determine the gross rent multiplier? Property value divided by the monthly rent Seller Jolita lists her house with Broker Fred. Fred then buys Jolita's house and collects the agreed-upon commission. This is an example of self-dealing.A square is 1/8 of a mile by 1/8 of a mile. How many acres is this?10 acresOne-eighth of a mile square is the same as 10 acres. Multiply 1/8 X 1/8 = 1/64 divided into 640 acres = 10 acres When the lender under a deed of trust requires title insurance, who would be the most likely person to pay for

it?The trustor

Why would a mortgagee have an appraisal on the property?To assure the property value is sufficient to cover the loan With how many states does Florida have a reciprocal, or mutual recognition agreement with?

• states

Restrictive covenants that run with the land apply to and bind all successive owners of the property.On an 8% straight term loan of $6,071, the borrower paid total interest of $1,700. How long did he have the loan?42 months A scale drawing shows a room to be 3 inches by 4-1/2 inches. Carpet, which is $15 per square yard, is to be installed in the room. If the scale is 1 inch to 4 feet, how much would it cost to install the carpet?$360 Under an FHA graduated payment mortgage, which of the following fluctuates over the term of the loan?Monthly payments A feature found in a comparable property that is not present in the subject property will result in a reduction adjustment to the comparable's selling price.A real estate agent should tell the buyer, his customer, which of the following?A pending or recent zoning change Which is the most common form of mortgage? Amortized loan A real estate licensee has a buyer agency agreement.What is the seller in this situation?A customer.A seller listed his home for six months on February 26. On April 29, a buyer made an offer on the property. The listing broker presented the offer to the seller on April 30. The seller accepted the offer on May 1, with the closing to occur on June 15. Assuming the closing took place on June 15, when did the listing expire?6/15 An impound or reserve account MOST benefits whom? The lender A mortgage company makes a number of loans to be assembled into one package and sold to permanent investors. This process is an example of interim financing to the mortgage company and is called warehousing.Who is the largest purchaser in the secondary market?Fannie Mae A borrower bought a $174,000 house with no down payment. The loan was probably a VA loan.The sellers listed their property for six months on February 26 for $522,500. They agreed to pay the listing broker a 7% commission at closing on the agreed upon sale price. A buyer made an offer on the property on March 29 for $510,000. The seller countered the offer on April 1 at $517,500, and the buyer accepted the counter offer with the closing to occur on June 15. How much commission did the seller owe the listing broker, and how would it appear on the settlement statement?$36,225. Debit the seller.Under RESPA, a copy of Real Estate Settlement Costs And You must be given at the time of loan application, or within 3 days of application.