Deck 1: Introduction to Real Estate

Question 1

The fine for an unlicensed individual who receives an illegal commission is:
(a) $100
(b) $1,000
(c) $20,000
(d) $100,000

Answer 1

C

Question 2

A real estate broker is most frequently the agent of the:
(a) seller
(b) buyer
(c) lender
(d) escrow company

Answer 2

A

Question 3

The state law that prevents agents from discriminating when providing real estate services to the public:
(a) Fair Housing Act
(b) Rumford Act
(c) Unruh Civil Rights Act
(d) Housing Financial Discrimination Act

Answer 3

C

Question 4

An appraisal is defined as:
(a) market price
(b) an estimate of value
(c) maximum security for a loan
(d) actual resale price

Question 5

Airspace directly above a parcel of land is considered to be:
(a) personal property
(b) fixture
(c) a chattel
(d) real property

Question 6

Under the treaty of Guadalupe Hidalgo in 1848, the United States acquired the territory of California from:
(a) Spain
(b) Mexico
(c) France
(d) Native American Indians

Question 7

Under Proposition 13, the maximum real property tax cannot exceed what percent of full cash value (before adjustments for inflation and voter approved bonds)?
(a) 1%
(b) 2%
(c) 5%
(d) 9%

Question 8

The definition of land includes all but one of the following:
(a) airspace above the land
(b) hills and valleys
(c) rocks and soil
(d) oil deposits beneath the surface of the land

Question 9

Property owners whose land borders a river have rights to a reasonable use of the water, known as:
(a) appropriation rights
(b) riparian rights
(c) seizure use rights
(d) extraction rights

Question 10

A real estate broker received a commission of $6,300, which represented 6% of the sales price of the lot. What was the sales price of the lot?
(a) $ 26,800
(b) $110,000
(c) $105,000
(d) $ 98,200

Question 11

California became a state in:
(a) 1848.
(b) 1849.
(c) 1850.
(d) 1851.

Question 12

Real property can be most completely defined as:
(a) land, buildings
(b) land, fixtures, minerals
(c) land, items affixed to land, immovable by law
(d) land, affixed to land, appurtenances, immovable by law

Question 13

Which government program requires the least down payment for the purchase of an owner-occupied $400,000 condo?
(a) FHA 203b program
(b) FHA 245 program
(c) VA
(d) regular CAL-VET Loan

Question 14

A residential tenant may expect the landlord to make necessary repairs to keep the dwelling habitable. If the landlord does not, the tenant may make needed repairs and offset the rent up to:
(a) a $700 maximum
(b) one month's rent
(c) reasonable cost
(d) $1,000 maximum

Question 15

An easement is defined as:
(a) a general lien
(b) an encumbrance
(c) a specific lien
(d) a restriction

Question 16

The contract where a principal appoints a real estate agent is called:
(a) contract of sale
(b) deposit receipt
(c) listing agreement
(d) disclosure statement

Question 17

The foundation of a standard built home sits on the:
(a) mudsill
(b) collar beam
(c) footing
(d) stud

Question 18

California became a state in:
(a) 1850.
(b) 1849.
(c) 1848.
(d) 1851.

Question 19

Which of the following must have an escrow license to handle the closing of the sale?
(a) title insurance company
(b) independent escrow company
(c) real estate broker who is the agent of the buyer or seller
(d) all of the above must have an escrow license to handle the closing

Question 20

A due-on-sale clause in a real estate promissory note is correctly called:
(a) a subordination clause
(b) an alienation clause
(c) an acceleration clause
(d) a prepayment penalty

Question 21

The right to a reasonable use of the surface waters upon which a property owner's land borders is called:
(a) riparian rights
(b) the right of correlative user
(c) the right of appropriation
(d) the right of emblements

Question 22

Effective January 1, 2005, a California Law called the Domestic Partnership Act was created to give ________ many new rights and responsibilities.
(a) real estate agents
(b) joint tenants
(c) registered domestic partners
(d) community property laws

Question 23

Which of the following is classified as personal property?
(a) seasonal crops
(b) fixtures
(c) land
(d) appurtenant easements

Question 24

In the early history of California, what group of explorers and colonizers were responsible for the development of presidios and pueblos?
(a) early Native American tribes
(b) Mexicans
(c) Spaniards
(d) colonial Americans

Question 25

Which of the following is false?
(a) airspace is considered real property
(b) real property can be divided horizontally
(c) solid minerals in the ground are considered real property
(d) landscaping is considered personal property

Question 26

Personal property differs from real property in many aspects and is legally known as:
(a) chose
(b) chattel
(c) freehold
(d) both (a) and (b) are correct

Question 27

A deeded easement of right-of-way over the land of another is considered to be:
(a) personal property
(b) an encroachment
(c) an appurtenance
(d) a lien

Question 28

There was some question in the mind of the owner as to whether or not she had any riparian rights on her recently purchased property. She was informed that the riparian rights are:
(a) a matter of record
(b) listed in the title policy
(c) stated in the grant deed
(d) not found in any of the above

Question 29

The addition of a wood-burning stove in a family room, with the stove pipe passing through the roof, is an example of:
(a) personal property becoming a fixture
(b) real property becoming a fixture
(c) personal property becoming a chattel real
(d) a fixture becoming personal property

Question 30

Which of the following is considered to be real property?
(a) a lease to an apartment house
(b) a cash register in a drug store
(c) a grape crop, sold under contract, but not yet harvested
(d) standing timber sold with land

Question 31

Permission to use underground waters, known as percolating waters, is owned by the:
(a) landowner for his or her exclusive use
(b) adjoining owners for their reasonable use
(c) State of California
(d) United States Government

Question 32

The legal term referred to as real property includes all of the following, except:
(a) an unlimited use of the airspace above the property
(b) that which is immovable according to law
(c) the land beneath the surface to the center of the earth
(d) determined by law to be a fixture

Question 33

Courts frequently have to make a decision as to whether some item does or does not go with the real property when it is sold. In making their decision, they use the "Five tests of a fixture." Which of the following is not a test of a fixture?
(a) method by which property is attached
(b) whether the property is considered adaptable
(c) whether the property is being taxed
(d) relationship of parties involved

Question 34

Which of the following is considered to be personal property?
(a) easement
(b) iron ore in the ground
(c) mortgage contract
(d) stock in a mutual water company

Question 35

An investor leases a building to a tenant who then opens a retail store. The tenant installs a cash register. The cash register is best described as:
(a) personal property
(b) trade fixture
(c) real property
(d) leased property

Question 36

When anything is fastened or attached to real property in such a manner as to ensure its permanence, it is considered to be:
(a) personal property
(b) real property
(c) private property
(d) separate property

Question 37

The rights of an owner are referred to as the "Bundle of Rights." Which of these is not one of these rights?
(a) the unrestricted right to the use of riparian waters
(b) the right to possess
(c) the right to borrow against real property
(d) the right to use

Question 38

Which of these statements most nearly defines personal property?
(a) trees in a forest
(b) stock sold to bring water on the land of a group of landowners who have formed their own company
(c) an unharvested peach crop sold to canning factory
(d) the right to cross over someone else's property

Question 39

An owner sells land, but reserves the mineral rights. Based on this, which of the following is true?
(a) the mineral rights are owned by the grantee
(b) the mineral rights are the personal property of the grantor
(c) the grantor owns the mineral rights as joint tenants with the grantee
(d) the mineral rights are the real property of the grantor

Question 40

In addition to the land and those things that are affixed to the land, certain other things called appurtenances are considered to be real property. Which of the following is not real property?
(a) trade fixtures
(b) a dwelling
(c) watercourses
(d) a fence

Question 41

Erick Chinn bought a stack of lumber, which he placed in his backyard. Later he used some of the lumber to build a room addition to his house. He only used a portion of the lumber. The remaining wood is considered:
(a) chattel
(b) real property
(c) personal property
(d) both (a) and (c) are correct

Question 42

The need to determine whether property is real or personal frequently arises. Which of the following would not be classified as real property?
(a) airspace over a condominium project
(b) newly planted fruit trees
(c) stock in a real estate corporation
(d) minerals in the ground before they are mined

Question 43

The right to possess, encumber, use, and enjoy a piece of property, to the exclusion of all others, would be an accurate description of:
(a) a life estate
(b) real property
(c) property ownership
(d) an equitable position

Question 44

A legal definition of real estate includes many elements and parts. Which of the following items would not be a part of real estate?
(a) farm equipment
(b) fences
(c) growing trees
(d) permanent two-story buildings

Question 45

Which of the following is considered personal property?
(a) a peach orchard
(b) stock in a mutual water company
(c) silver removed from the ground and sent to the smelter
(d) easement