California: Real Estate “Legal Aspects” – Sample of Final Course Exam
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1 of 100 What accurately locates and identifies boundaries of a subject parcel to a degree acceptable by courts of law in the state where the property is located?
A. A stake survey
B. A deed
C. A legal description
D. A title search
California: Real Estate “Legal Aspects
2 of 100 According to a CAR Residential Purchase Agreement, how long does a buyer have to complete inspections and approve all material provided by the seller in relation to the property, if not specified?
A. 3
B. 21
C. 10
D. 17
3 of 100 The Uniform Commercial Code does all of the following EXCEPT:
A. allow the expansion of commercial practices.
B. modernize the law governing commercial transaction.
C. clarify the law governing commercials transaction.
D. create local ordinances.
4 of 100 When a seller lists his or her home with a licensee and the property does not go under contract or if the client does not agree to extend the time of the listing, then the listing will:
A. terminate.
B. cancel.
C. expire.
D. not sell.
5 of 100 What is an additional clause in a sales contract where the seller warrants that there are no undisclosed building codes or zoning violations?
A. Owner’s association disclosure
B. Inspections
C. Survey
D. Compliance with laws
6 of 100 Which part of a Loan Disclosure states what late fee the lender will charge?
A. Partial payments
B. Security interest
C. Negative amortization
D. Late payment
7 of 100 The law enforces promises through the use of
A. laws.
B. regulations.
C. contracts.
D. policies.
8 of 100 What advertising phrase would be considered discriminatory based on handicap?
A. Fourth-floor walk up
B. Jogging Trails
C. Walk-in closets
D. Able bodied persons only
9 of 100 Which section in a CAR Residential Purchase Agreement shows who will pay the county transfer fees, private transfer fee, city transfer fee, and home warranty?
A. Items included in sale
B. Escrow
C. Note to Buyer and Seller
D. Other Costs
10 of 100 The collection of Roman law contributed the model for which type of law?
A. Civil law
B. Criminal law
C. Case law
D. Common law
11 of 100 It is important for a licensee or a broker to remove ambiguity when a seller’s unclear decision could be discriminatory by forcing the seller to
A. cooperate with the buyer.
B. renegotiate the contract.
C. pay the closing costs.
D. articulate his or her concern.
12 of 100 What lease provision would outline the condition of the property at the time a lease is executed?
A. Maintenance and repair
B. Rules and Regulations
C. Landlord Entry
D. Condition of the Property
13 of 100 What Act requires that lenders keep all credit information confidential?
A. The Fair Lending Act
B. The Unruh Civil Rights Act
C. The Home Mortgage Disclosure Act
D. The Fair Credit Reporting Act
14 of 100 In contract law, what term means someone has broken his or her word?
A. Infringement
B. Violation
C. Infraction
D. Breach
15 of 100 What term describes a person, company , or entity that assigns its right to another?
A. Assignee
B. Delegor
C. Assignor
D. Delegee
16 of 100 What informs buyers and prospective tenants of registered sex offender database that can be searched to identify if any sex offenders are near property?
A. Identifying a Registered Sex Offender Pamphlet
B. Notice Regarding Database of Location if Registered Sex Offenders
C. A Sex Offender Disclosure Form
D. A Property Disclosure Statement
17 of 100 In creating a joint tenancy, there are four unities. Which of the following is NOT one of the four?
A. Unity of Time
B. Unity of Possession
C. Unity of Interest
D. Unity of Origination
18 of 100 Effective October 2015, the two forms that are the primary closing information documents for most real estate transactions are the Loan Estimate and
A. Payment Schedule.
B. Closing Disclosure.
C. Buying Disclosure.
D. Mortgage Statement.
19 of 100 Which section, in a CAR Counteroffer, states that a binding agreement is created when a copy of a signed acceptance is personally received by the maker of the counteroffer or the person’s authorized agent?
A. Offer
B. Acceptance
C. Expiration
D. Terms
20 of 100 What describes when a buyer files a claim in situations where the seller has not delivered the title after all other terms of the contract have been satisfied?
A. An equitable lien
B. A statutory lien
C. A vendor’s lien
D. A vendee’s lien
21 of 100 What is known as water beneath the surface that runs in recognizable underground streams or collects in porous ground layers called aquifers?
A. Common water
B. Surface water
C. Ground water
D. Water table
22 of 100 If the interest-holder enjoys the right of possession of land, the party is considered to have
A. eminent domain.
B. a leasehold estate.
C. an encumbrance.
D. an estate in land.
23 of 100 Who is generally responsible for ensuring that the Closure Disclosure is delivered to the buyer no later than three business days before consummation?
A. The broker
B. The creditor
C. The licensee
D. The title company
24 of 100 What type of variance permits an application to vary one or more of the dimensional or physical requirements of the acceptable zoning law, code or ordinance in connection with some proposed construction?
A. A zoning variance
B. A use variance
C. A code variance
D. An area variance
25 of 100 What type of an estate is one that continues for a definite fixed period of the time?
A. Estate from period to period
B. Estate for years
C. Estate at will
D. Estate at sufferance
26 of 100 What do California homeowners receive to protect equity when a court forces the sale of the house to pay for a judgement?
A. Sole proprietorship
B. A general exemption
C. An automatic homestead exemption
D. A callable loan
27 of 100 If a deed is to be recorded, California requires that it be recorded in the office of the county clerk
A. in the county where the buyer resides.
B. in the county of choice determined by the clerk.
C. at the greed upon location.
D. in the county in which the property is located.
28 of 100 In a CAR Residential Purchase Agreement, who is responsible for repairing and damages that occur as a result of inspections?
A. The seller
B. The broker
C. The buyer
D. The inspector
29 of 100 If a person dies with no heirs and no one qualified to receive e property, what power will state use to claim the property?
A. Escheat
B. Eminent domain
C. Sovereignty
D. Incentive
30 of 100 Which fiduciary duty requires an agent to place the client’s interests above those of all others, including his or her own?
A. Honesty
B. Loyalty
C. Accountability
D. Disclosure
31 of 100 What term describes the borrower in a mortgage?
A. A creditor
B. A mortgagee
C. A mortgage lender
D. A mortgagor
32 of 100 What term describes a legal procedure of removing a tenant from a property because there is a breach of the lease or rental agreement?
A. Notice
B. Foreclosure
C. Eviction
D. Displacement
33 of 100 What describes conditions that must be met in order for a contract to be enforceable?
A. Terms
B. Limitations
C. Contingencies
D. Restrictions
34 of 100 What Act requires financial institution to maintain and disclose data about home purchases, home purchase pre-approvals, home improvement and refinance applications involving 1 to 4 unit multifamily dwellings?
A. The Banking Disclosure Act
B. The Home Mortgage Disclosure Act
C. The Consumer Protection Act
D. The Equal Credit Opportunity Act
35 of 100 How many years must a candidate serve as a real estate broker, actively engaged in the real estate business in order to be appointed as Commissioner?
A. 4
B. 1
C. 3
D. 5
36 of 100 What term describes the sudden decrease of land by flowing water or waves often caused by hurricanes and other storms?
A. Erosion
B. Accretion
C. Reliction
D. Avulsion
37 of 100 When a person first meets a person, that person is called a
A. principal
B. customer
C. client
D. buyer
38 of 100 What are unsecured claims that take the place alongside the borrower’s other depts?
A. Limitation judgements
B. Deficiency judgements
C. Sale proceeds
D. A writ of execution
39 of 100 What provides legal, public, and constructive knowledge to everyone about the ownership of a property?
A. A contract
B. The act of recording
C. Title
D. Judgement
40 of 100 The discovery step of civil cases is where
A. the parties use a mediator
B. the complaint is filed.
C. each party presents their case.
D. each party gathers information from each other and third parties.
41 of 100 If a broker is also an escrow agent in a transaction, he or she must put aside any agency relationships with the parties involved and become a
A. subordinate agent.
B. transaction broker.
C. neutral depository.
D. dual agent.
42 of 100 What is a legal instrument for the volunteer transfer of real and personal property after the owner’s death?
A. A trust
B. A will
C. A deed
D. A title
43 of 100 All of the following Bill of Rights protection are related to property rights EXCEPT
A. equal protection.
B. unreasonable search and seizure.
C. just compensation.
D. freedom of speech.
44 of 100 What type of residential survey, also called a drive-by survey, is designed to show the location of the house and other large structures on the property?
A. A house location survey
B. A cadastral land survey
C. A site survey
D. A boundary survey
45 of 100 All of the following lien types are exempt from the homestead law EXCEPT
A. refinancing a lien against the homestead.
B. manufactured home refinancing.
C. credit card.
D. purchasing money on the homestead.
46 of 100 When a salesperson says or does something that creates agency such as giving advice to a customer, giving an opinion to a customer, or negotiating on a customer’s behalf the license has
A. created agency
B. universal agency
C. express agency
D. implied agency
47 of 100 What are all parties required to use, to fulfill contingency requirements, under California law?
A. An attorney
B. Consideration
C. Due diligence
D. A transaction broker
48 of 100 California requires that deaths that occurred within the past three years be disclosed unless an occupant of the property dies with, or as a result of,
A. cancer.
B. leukemia.
C. environmental factors.
D. AIDS
49 of 100 Within how many days of providing labor, materials, or services must preliminary notice be given when filing a mechanic’s lien?
A. 30
B. 45
C. 20
D. 25
50 of 100 If a person believes he or she has been discriminated against, within what period of time of the alleged act must a compliant be filed with HUD?
A. 60 days
B. 2 years
C. 1 year
D. 6 months
51 of 100 Joe has a lease that specifies rent and other requirements, but it does not have an expiration date or renewal cycle. What kind of leasehold estate is it?
A. Estate at Sufferance
B. Estate at Will
C. Estate for Period-to-Period
D. Estate for Years
52 of 100 The U.S. Constitution gives Congress implied power, which is the ability to
A. alter the Constitution.
B. levy taxes.
C. make any laws that they deem necessary.
D. make laws that are neither prohibited by nor violate the Constitution.
53 of 100 What term describes a temporary suspension of the development of a property?
A. Marquee
B. Moratorium
C. Dedication
D. Prezoning
54 of 100 The standard measure of loss of bargain damages, for a total breach, would encompass the difference between the agreed contract price and the market value of the property on the date of
A. contract
B. title
C. acceptance
D. breach
55 of 100 What type of deed is tailored to the requirements of specific parties, properties, and purposes?
A. A grant deed
B. A general deed
C. A special purpose deed
D. A full covenant and warranty deed
56 of 100 Civil law is different from criminal law in all of the following area EXCEPT
A. concerns.
B. rights.
C. parties filing.
D. goals.
57 of 100 When a spouse dies, how does community property get divided?
A. All of the property goes to the heirs.
B. Half of the property goes to the surviving spouse and half to deceased’s heirs.
C. All of the property goes to the surviving spouse
D. The game goes to the surviving spouse and all other property goes to the deceased heirs.
58 of 100 What type of contract contains vague terms that can be interrupted and understood in more than one way?
A. A contingent contract
B. An ambiguous contract
C. An indefinite contract
D. An explicit contract
59 of 100 What is a legally enforceable contract where an agent or owner of a property gives the exclusive right of possession for a specific amount of time in exchange for money?
A. A purchase agreement
B. An option to buy contract
C. A lease agreement
D. An assumption agreement
60 of 100 What is Real Estate Investment Trust (REIT)?
A. A syndicate of working real estate professionals
B. A syndicate of people looking for their first home
C. An unincorporated trust that holds a large number of real estate investments
D. A syndicate of few investors with large sums of investments capital
61 of 100 What clause describes the type of estate being conveyed and reaffirms the extent of ownership that the grantor is transferring?
A. A caveat emptor clause
B. An ownership clause
C. A habendum clause
D. A contingency clause
62 of 100 What have lenders established to protect borrowers from unlimited increases in the interest rate?
A. Mortgage caps
B. Rate caps
C. Payment caps
D. Amortization caps
63 of 100 A licensee can provide actual factual knowledge to a customer but does not provide
A. property improvements.
B. square footage.
C. sale’s price.
D. advice.
64 of 100 Which of the following in NOT a specified federal court?
A. U.S. Claims Court
B. U.S. Supreme Court
C. U.S. Tax Court
D. U.S. Bankruptcy Court
65 of 100 What type of property is abstract, having no physical existence in itself, other than as evidence of one’s ownership interest?
A. Representational property
B. Tangible property
C. Real Estate
D. Intangible property
66 of 100 Who can file a discriminatory complaint?
A. A buyer
B. A seller
C. Anyone
D. A broker
67 of 100 What can a plaintiff file essentially telling potential buyers that the property is subject to a judgement of a pending lawsuit by putting a cloud on the title?
A. A writ of attachment
B. A chain of title
C. A lis pendens
D. A writ of execution
68 of 100 Any last minute changes to a contract that are done by hand should be initialed by
A. the seller
B. the buyer
C. all parties to the contract
D. the broker
69 of 100 Who is charged with the responsibility of making sure that the owners do not use their property in a way that will harm the public?
A. The Real Estate Commission
B. The HOA
C. The government
D. The zoning committee
70 of 100 What rules should you follow to decrease the possibility of lawsuits?
A. Property inspection rules
B. Office policy rules
C. Licensing rules
D. Agency Disclosure Rules
71 of 100 In partnership, a general partner
A. has limited liability.
B. shares equal liability with other partners.
C. has no liability.
D. has unlimited personal liability.
72 of 100 The purpose of restrictive covenents is to preserve and protect the quality of land in subdivisions and maximize
A. incentive zoning.
B. land improvements.
C. land values.
D. recreational use.
73 of 100 What is something an escrow agent should never do?
A. Receive money from lenders.
B. Offer legal advice.
C. Obtain title insurance.
D. Prepare closing documents.
74 of 100 Arbitration is an out of court settlement procedure where
A. the third party has the power to make a binding decision.
B. the third party attempts to make a compromise.
C. the third party conducts a discovery.
D. the third party consults with a judge.
75 of 100 What describes when some expense paid at closing are divided proportionally between the buyer and the seller?
A. Assign
B. Disseminate
C. Withhold
D. Prorated
76 of 100 What type of mortgage is one that includes all the personal property and appliances that are installed on the property?
A. A purchase money mortgage
B. A blanket mortgage
C. A graduated mortgage
D. A package mortgage
77 of 100 A buyer Representation Agreement is bilateral because it defines the obligations and responsibilities of
A. the broker.
B. both parties.
C. the buyer.
D. the licensee.
78 of 100 In what type of listing does an owner set a minimum amount that he or she wants to receive from the sale of the property and let the broker have a commission any amount above set minimum?
A. An exclusive agency listing
B. A net listing
C. A one-time show listing
D. An open listing
79 of 100 Which part of a Closing Disclosure details the total amount of all the payment on the loan, the dollar amount of the finance charges over the life of the loan, the amount financed, the APR and the TIP?
A. Contact information
B. Confirm receipt
C. Loan calculations.
D. Other disclosures.
80 of 100 The agency relationship between the buyer, seller and broker(s) must be confirmed in writing in either the C.A.R. Standard Form AC-6 or
A. the inspection notice.
B. the real estate listing.
C. the transaction form.
D. the purchase contract.
81 of 100 If a seller declines to show a property to a minority he or she can be sued for violating
A. HUD.
B. fair housing laws.
C. the Equal Opportunity Act.
D. RESPA.
82 of 100 Who sets the amount of rate of real estate commissions?
A. The real estate board
B. The escrow agent
C. The lender
D. The broker
83 of 100 Federal law requires that information, regarding lead-based paint, be given to a buyer or tenant on home built prior to
A. 1980
B. 1984
C. 1978
D. 1990
84 of 100 What system, also called the recorded plat method, is used to describe properties in residential, commercial, and industrial subdivisions?
A. The rectangular survey system
B. Metes and bounds
C. The lot and block system
D. The Public Land Survey System
85 of 100 What term, in the California Civil Code addressing mobile home residency, describes the right of a homeowner to use the site within a mobile home park?
A. Leasehold
B. Specific Use
C. Tenancy
D. Propriety
86 of 100 How much of a property exemption is a totally disabled war veteran, making over $40,000 annually and living in California , entitled to?
A. $50,000
B. $100,000
C. $40,000
D. $75,000
87 of 100 In a real estate transaction, who is the decision maker on all things?
A. The broker
B. The buyer
C. The client
D. The seller
88 of 100 What is not one of the 4 choices a buyer can make when a counteroffer is given back to him or her?
A. The counteroffer could be accepted.
B. Another counteroffer can be made.
C. The counteroffer can be rejected.
D. The counteroffer could become a lease.
89 of 100 California courts have held that if a lease is written, then it must be signed by the
A. leaseholder.
B. lessee.
C. tenant.
D. lessor.
90 of 100 What is pur autre vie life estate?
A. It endures over the lifetime of the owner, then passes to an heir.
B. It ends with the death of the life estate owner and may pass back to the original owners or their heirs or to a named third party.
C. It ends with the death of the original grantor, then passes to a third party.
D. It endures over a lifetime of a third person, after which the property passes from the tenant holder to the original grantor.
91 of 100 What is a second step in a civil case in district court?
A. Pleadings
B. Discovery
C. Post trial
D. Pre trial
92 of 100 What is a type of company that sells securities specializing in real estate ventures, and requires a minimum of 100 investors?
A. A real estate corporation
B. A limited liability corporation
C. A real estate investment trust
D. A partnership
93 of 100 Where must a declaration of homestead be filed?
A. The district assessor’s office
B. A title company
C. The Office of Housing and Urban Development
D. The county recorder’s office
94 of 100 What term describes the unlawful misappropriation and use of a client’s funds by a licensee?
A. Continuance
B. Conversion
C. Commingling
D. Laundering
95 of 100 What describes minerals that are deemed real property, such as gold and silver, until they are removed from the earth and become personal property?
A. Mineral rights
B. Nutrients
C. Synthetics
D. Solid minerals
96 of 100 Which provision in a CAR Residential Listing Agreement states that the property is offered in compliance with federal, state, and local anti-discrimination laws?
A. Management approval
B. Ownership
C. Equal Housing Opportunity
D. Acknowledgement
97 of 100 Which section of a CAR Residential Purchase Agreement is a provision divided into 3 sections: mediation, arbitration of disputes, and additional terms?
A. Representative Capacity
B. Remedies for Buyer’s Breach of Contract
C. Dispute Resolution
D. Scope of Duty
98 of 100 The salesperson should always think the first offer the buyer makes should be his or her
A. worst offer
B. only offer
C. best offer
D. final offer
99 of 100 What describes plants or crops that are considered personal property since human intervention is necessary for planting and harvesting?
A. Appurtenances
B. Conservation
C. Fodder
D. Emblements
100 of 100 What type of zoning is density determined for an entire area, rather than on a lot by lot basis?
A. Down Zoning
B. Incentive Zoning
C. Cluster zoning
D. Exclusionary zoning
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