Question 1

An assessment does which of the following?

Accepted Answer

An assessment places a value on property for the purpose of taxation.

Question 2

Occasionally, the title to real property becomes unmarketable. Which of the following causes would be least likely to result in that eventuality?

Accepted Answer

Public restrictions rarely cause title to real property to be unmarketable; private restrictions sometimes do.

Question 3

One who establishes the value of a property for taxation purposes is called:

Accepted Answer

A public official who establishes the value of a property for taxation purposes is called an assessor.

Question 4

Which of the following would normally install conduit?

Accepted Answer

Electrical wiring is placed inside a metal pipe called a conduit.

Question 5

The term "note rate" refers to:

Accepted Answer

Note rate means the interest rate stated on a mortgage note.

Question 6

Which of the following real estate syndicates requires 100 or more investors:

Accepted Answer

A real estate investment trust, which is organized under federal laws, must have 100 or more investors.

Question 7

The amount paid by a mortgagor for mortgage insurance, either government or private is called:

Accepted Answer

The mortgage insurance premium is paid by a mortgagor for mortgage insurance, either to a government agency such as the Federal Housing Administration (FHA) or to a private mortgage insurance (MI) company.

Question 8

A salesman receives a deposit together with a written offer to purchase and delivers them to the employing broker who presents it to the seller. The seller signs and accepts the offer. Without the consent of the salesman and through no fault of his own, the buyer and seller instruct the salesman's employing broker to return the deposit. Which of the following is true?

Accepted Answer

Once the offer has been accepted, the deposit money belongs to the seller. If the seller instructs the broker to return the deposit, the broker must do so. The broker has probably earned a commission and may sue the seller for the amount but may not hold the deposit money.

Question 9

Insofar as a residential neighborhood is concerned, which of the following would offer the least protection against blighting influences on future development:

Accepted Answer

A partially built-up neighborhood would have a definite tendency for blighting, because it was not completed and there would be a potential for vandalism.

Question 10

Which of the following is not true of the term "depreciation"?

Accepted Answer

Depreciation is not a true expense where money is actually paid. It is a decline in the value of property and an accounting term showing the declining monetary value of an asset. Lenders add back depreciation expense for self-employed borrowers and count it as income.

Question 11

If you have a loan in which the interest rate does not change during the term of the loan you have a _____________ mortgage.

Accepted Answer

A loan in which the interest rate does not change during the term is called a fixed-rate mortgage.

Question 12

When a legal description uses only sections, townships and ranges, the lines relate to the:

Accepted Answer

Sections, townships and ranges are used in government surveys in describing the location of land. Metes and bounds description outlines a certain area.

Question 13

A consumer protection law that regulates the disclosure of consumer credit reports by consumer/credit reporting agencies and establishes procedures for correcting mistakes on one's credit record is called the:

Accepted Answer

The Fair Credit Reporting Act is a consumer protection law that regulates the disclosure of consumer credit reports by consumer/credit reporting agencies and establishes procedures for correcting mistakes on one's credit record.

Question 14

A lender refers to the process of getting new loans as:

Accepted Answer

A lender refers to the process of getting new loans as loan origination.

Question 15

If you have not made your mortgage payment within 30 days of the due date, the mortgage is considered to be in:

Accepted Answer

Failure to make the mortgage payment within a specified period of time, usually 30 days for first mortgages or first trust deeds, causes the loan to be in default.

Question 16

If you go to a bank or mortgage company to apply for a home, what type of mortgage would you be applying for?

Accepted Answer

Home loans which are not VA or FHA are called conventional loans.

Question 17

If a veteran is eligible for a VA loan, he or she would receive a document from the VA called:

Accepted Answer

A certificate of eligibility is a document issued by the Veteran's Administration that certifies a veteran's eligibility for a VA loan.

Question 18

The security of a loan made on real property depends upon:

Accepted Answer

The property is the underlying security for the loan.

Question 19

If a lender agrees to make a loan to a specific borrower on a specific property, they have made a:

Accepted Answer

A lender's agreement to make a loan to a specific borrower on a specific property is called a firm commitment.

Question 20

A title search of a property would show the following to be true:

Accepted Answer

A title search would show that the seller is the legal owner and there are no outstanding liens or other claims against the property.

Quiz 1: Real Estate