texas real estate practice exam Flashcards

texas real estate practice exam Flashcards For the proper handling of client and owner monies, a property manager is generally required toa) Deposit all funds every month in the management firm's central operating account.b) Employ a notary to witness and record every deposit or payment received.c) Maintain a special trust account and a qualified financial depository.d) Disperse all funds to their legal owners on a weekly basis.

c) Maintain a special trust account and a qualified financial

depository.Which of the following is an important function of the secondary mortgage market?a) Participants borrow funds from banks so the banks can make more loans.b) Participants issued tax certificates and sell them to primary lenders.c) Participants purchase pools of defaulted loans from lenders to keep them solvent.d) Participants sell mortgage-backed securities in order to buy pools of loans.

d) Participants sell mortgage-backed securities in order to

buy pools of loans.Which of the following parties does not have to have a real estate license to operate legally?a) A hostess at an open house who explains how the property's price was identified.b) Answering questions to confirm the terms of advertised property.c) An operator of a real estate rental agency.A person who supervises licensees.

b) Answering questions to confirm the terms of advertised

property.If a commercial real estate market is under supplied, it is

likely that:a) rental prices in that market will fall.b) Rental

prices in that market will rise.c) Rental prices will remain stable until equilibrium is reached.d) Construction will increase to the point of equilibrium.

b) Rental prices in that market will rise.

A protection period clause in an exclusive listing provides

that:a) The owner is protected from all liabilities arising

from the agent's actions performed within the agent's scope of duties.b) The agent has a claim to a commission if the owner sells or leases to a party within a certain time following the listing's expiration.c) Agents are entitled to extend a listing agreements term if a transaction is eminent.d) An owner is not liable for a commission if a prospective customer delays in completing an acceptable offer.

b) The agent has a claim to a commission if the owner sells

or leases to a party within a certain time following the listing's expiration.Which of the following is true of a loan with negative amortization?a) The interest rate on the loan increases as the principal balance decreases.b) Payments are not sufficient to retire the loan.c) The loan balance is diminishing or going negative.d) Additional interest as being added to the monthly payment.

b) Payments are not sufficient to retire the loan.

A builder is required to secure a loan with mortgages on three properties. This is an example ofa) A participation mortgage loan.b) A blanket mortgage loan.c) A permanent mortgage loan.d) A bridge loan.

b) A blanket mortgage loan.

The roof of a property cost $20,000. The economic life of a roof is 20 years. Assuming the straight-line method of depreciation, what is the depreciated value of the roof after three years?a) $20,000.b) $17,000.c) $14,000.d) $3000.

• $17,000.

If net income on a property is $40,000 and the cap rate is 10%, the value of the property using the income capitalization method isa) $100,000.b) $400,000.c) $1 million.d) $4 million.

• $400,000.

One difference between a cooperative estate and a

condominium estate is that:a) a condominium owner owns

a unit of air space whereas the co-op owner owns a proprietary lease.b) A condominium sale adversely affects other unit owners.c) The co-op owner owns stock and a freehold real estate interest whereas the condominium owner simply a proprietary lease.d) The condominium owner owns the common elements and the air space whereas the co-op owner only owns the apartment.

• a condominium owner owns a unit of air space whereas

the co-op owner owns a proprietary lease.A transaction facilitator in a residential transaction

represents:a) The seller.b) The buyer.c) Both seller and

buyer.d) Neither seller nor buyer.

d) Neither seller nor buyer.

Real estate advertising must conform to regulatory standards and requirements. One requirement isa) A broker may only place blind ads in social media outlets.b) A broker must have all advertising approved by the local real estate board.c) The advertising must not be deceptive.d) Sales agents may only advertise in their own name.

c) The advertising must not be deceptive.

Jennifer advised her clients that they needed to paint their living room before showing the property. The walls of these rooms were all 8 feet high. The wall lengths were 14 feet, 18 feet, 16 feet, and 18 feet. If a gallon of paint covers 200 ft.², how many whole gallons would the home sellers have to buy?a) One.b) Two.c) Three.d) Six.

c) Three.

The highest form of ownership interest one can acquire in

real estate is the:a) legal life estate.b) Conventional life

estate.c) Defeasible fee simple estate.d) Absolute fee simple estate.

d) Absolute fee simple estate.

A property owner has an easement appurtenant on her property. One day the property is sold to another party who is opposed to the easement. Following the closing, this

particular form of easement:a) terminates.b) Transfers with

the property.c) Transfers with the owner to a new

property.d) Becomes a license on the property.

b) Transfers with the property.

What fundamental legal purpose is fulfilled by title records?a) Keeping the county apprised of tax payments.b) Preventing identity theft.c) Giving constructive notice of one's rights and interests in the property.d) Assembling all

relevant documents in a single place.

c) Giving constructive notice of one's rights and interests in

the property.With various types of junior liens, the order of payment

priority is generally established according to:a) the date of