PSI Exam Prep Oregon Real Estate Questions and Answers Already Passed

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PSI Exam Prep Oregon Real Estate Questions and Answers Already Passed How does a creditor who has obtained a judgment get satisfaction against a debtor who will not pay? ✔✔Writ of execution. A... major difference between freehold and nonfreehold estates is that all freehold estates _________. ✔✔are of indeterminable duration. The economic characteristics of land are ✔✔Scarcity, location, and durability. At the time of harvest, crops that require annual planting are generally considered to be ✔✔Personal Property. A legal easement can be created by any of the following EXCEPT ✔✔merger of titles What type of map is MOST useful for describing the terrain of a very hilly lot? ✔✔contour map. Tenants are still in their rental property even though their lease has expired. The landlord has given them written notice to quit and refused to accept rent. They are ✔✔Tenants at sufferance. The real estate contract for a specific property for use as an unlicensed whiskey sales operation was forced to terminate. The termination was the result of ✔✔impossibility of performance. The purpose of requiring an earnest money deposit in a real estate sales contract is to ✔✔provide evidence of the buyer's intention to carry out the contract. When one of the parties to an agreement fails to perform one of its conditions, that contract is deemed to be ✔✔Breached. A will has been drawn up leaving the family homestead to the owners' granddaughter. Once that has been done, the owners may ✔✔make any changes they wish through a codicil or a later will. At the closing on June 15, the buyer is assuming a mortgage presently on the property, on which the monthly interest charge is currently $600. The seller has made the payment due on June 1. Assuming a VA mortgage, what is the adjustment made at closing? ✔✔Debit the seller $300; Credit the buyer $300. For Federal income tax purposes, which of the following are costs of homeownership that may be deducted from gross income? ✔✔Mortgage loan interest, local property taxes, mortgage loan origination fees. MOST closed real estate transactions should be reported to the IRS. REQUIRED information includes seller name(s) and social security number(s) and ✔✔the sale price. The buyer is assuming the mortgage presently on the property in the mount of $110,000. What is the adjustment made at closing? ✔✔Credit buyer $110,000; no adjustment to the seller. A judgment has been properly recorded. Any subsequent purchasers, whether they have actually examined the record or not, have been given ✔✔constructive notice. Under a land contract for deed, who retains fee ownership of the property? ✔✔Vendor A broker says, while showing a rural property, "This property has the world's purest well water." This would be an example of ✔✔an expression of opinion, or puffing, which could lead to misrepresentation. Errors and Omissions insurance covers the broker for ✔✔unintentional misrepresentations Earnest money should be deposited into a trust account ✔✔in a timely manner, according to state laws. Antitrust laws prohibit competing brokers from all of the following EXCEPT ✔✔receiving compensation from both the buyer and the seller. A single parent of two preschool children makes an application to rent a condo in a development intended for older persons that is 90% occupied by people over the age of 55. In this case, the Federal Fair Housing Act protects the ✔✔condo owner from being forced to rent to the family because of the age of over 80% of the occupants of the development. According to the Truth-in-Lending Act, if any "trigger terms" are used in an ad, all of the following disclosures MUST appear in the ad EXCEPT the ✔✔prepayment penalties and rebates. The buyer wants to make the purchase offer contingent on a complex mortgage arrangement. The buyer's agent who is drawing up the contract should ✔✔suggest the buyer ask a lawyer to furnish the wording. An equal housing opportunity notice MUST be ✔✔displayed in the brokerage office. A salesperson qualified a minority couple with two children and defined their price range as between $110,000 and $120,000 for the three-bedroom house they wanted. They asked to look at two listings in a nonminority neighborhood. The salesperson did not show them the properties because they were priced under $90,000 and had only two small bedrooms. Did the salesperson act appropriately and why or why not? ✔✔no, because it is appropriate to show any property for which the buyer is qualified. A managing broker can be held responsible for ✔✔all real estate activities of salespersons. The sellers have agreed to gibe the buyers an allowance of $16.95 per square yard to retile the kitchen. If the kitchen is 10 feet x 14 feet, how much will it cost the sellers (to the nearest dollar)? ✔✔$264 An owner lists her home at a 7% commission rate and wants to net $45,000 after paying the mortgage balance of $68,000 and the broker's commission. To the nearest dollar, what should the selling price be to net her $45,000? ✔✔none A couple bought a rental house for $195,000. Its assessed value was $180,000. If the tax rate is $1.50 per $100 of assessed value, what is the monthly contribution the lender will REQUIRE for taxes? Round to the nearest cent. ✔✔$225.00 A buyer is getting a fully amortized loan for $220,000. The bank will give the buyer the loan for 15 years at 5 1/2% or for 30 years at 6 1/2%. To the nearest cent, what is the difference between the monthly payments for these two loans? (BE SURE TO USE THE AMORTIZATION TABLE.) ✔✔$409.20 If a borrower can afford to make monthly principal and interest payments of $1,000 and the lender will make a 30-year loan at 5-1/2%, or a 20-year loan at 4-1/2%, what is the largest loan (rounded to the nearest $100) this buyer can afford? (BE SURE TO USE THE AMORTIZATION TABLE.) ✔✔$130,000 a major reason for buying and owning a condominium rather than a detached single-family home is that ✔✔a condominium tends to be more affordable. Ownership of common stock in a corporation gives ✔✔an interest that is classified as personal property. Too much leverage may result in? ✔✔negative cash flow Parcels A, B, and C are located side by side and owned by three different owners. A is worth $20,000, B is worth $27,000, and C is worth $16,000 for a total of $63,000. A developer believes that if all three can be purchased, the larger parcel would be worth $85,000. By assembling these under one owner they would be worth $22,000 more than their individual values. This demonstrates which principle of value? ✔✔Plottage. Which rule-of-thumb version is being offered to an investor who is told that a house renting for $900 a month should sell for about $90,000? ✔✔GRM Which of the following approaches MOST reliably estimates the sales price of a single-family residence? ✔✔Market Data. If all other factors are equal, in which location is a parking lot likely to bring the highest sales price? ✔✔Business district zoned for a six-story office building. An appraiser MUST be licensed or certified to handle Federally related work on residential property valued at more than ✔✔$250,000. A competitive market analysis is MOST often used for ✔✔setting a listing price. All of the following are methods to calculate the reproduction or replacement cost of a building EXCEPT the ✔✔straight-line method. The FHA functions MOST like ✔✔an insurance company. The Equal Credit Opportunity Act addresses all of the following EXCEPT ✔✔standardization of interest rates. A deed restriction is applicable to the activities of ✔✔present and future owners. If conditions for purchase are included in a deed and these conditions are violated, what is the penalty? ✔✔return of the property to the original owner. An Environmental Impact Statement (EIS) ✔✔projects the impact of the environment of a proposed project. The principal difference between zoning and planning as they relate to land use control is that zoning ✔✔is a legal implementation while planning is a process. A lawsuit for inverse condemnation may be brought by ✔✔a homeowner. The purpose of laws that provide for property to escheat to the state or county when a landowner dies with no will and no heirs is to ✔✔prevent property from being ownerless. Although states make specific laws governing water rights and the rights in land that borders water, most states generally follow one of two basic doctrines regarding water rights. Either riparian and littoral rights are automatically conveyed with property, or all water rights are controlled by the state under the doctrine of prior appropriation. The doctrine of prior appropriation is MOST likely to be followed in states where ✔✔prior appropriation. A borrower has defaulted on the mortgage. The mortgage contains an acceleration clause. This permits the lender to ✔✔demand immediate payment of the entire note. Which of the following statements about discount points is false? ✔✔They are computed as a percentage of the selling price. In helping a buyer to select a lender, if the buyer believes he has good credit and his income is documentable as a salary and by tax returns, the licensee might recommend a mortgage banker, instead of a mortgage broker, for all of the following reasons EXCEPT ✔✔more variety of loan programs available. An adjustable rate loan should include all of the following elements EXCEPT ✔✔negative amortization. Usury laws were enacted to protect the ✔✔borrower When is flood insurance REQUIRED in order to obtain a loan? ✔✔When the property is located in a flood hazard zone. A couple listed their home with a broker. After 2 months, the seller found a buyer, and the sale closed. The seller was not obligated to pay a commission to the broker. This listing was MOST likely ✔✔an exclusive agency listing. The day after a broker's listing on a house expired, it was listed with another broker and offered in the MLS. Several days later, a third licensee called the first broker and asked for the key to show the home. The broker should inform the caller that ✔✔he is no longer the listing agent. The real estate licensee who accepts an undisclosed fee for referring a buyer to a specific title company may be in violation of ✔✔RESPA. A broker, acting as agent for the seller, presents an offer to buy from the broker's former college roommate. The broker knows that the buyer will increase the amount of the offer in the seller turns down the offer. When presenting the offer, the broker should ✔✔tell the seller that the buyer will pay more. Another term for the owner of a property listed with your firm is the ✔✔client. A broker supplies the financing for a project to build condominiums with the stipulation that he has the exclusive right to sell the completed condos. Which of the following BEST describes this relationship? ✔✔Agency coupled with an interest. A broker lists a property, with a listing contract allowing subagency and dual agency. One of the broker's salespersons shows the property. The salesperson would be classified as ✔✔a subjacent of the seller. An agency relationship between a property owner and a property manager is usually created by ✔✔a management agreement. A realty firm has just entered into an agreement to represent a home builder in the sale of a new subdivision. The firm has located several potential buyers and five homes have been sold to purchasers that the firm's agents have contacted. The realty firm has an agency relationship with ✔✔the builder. A broker has brought a ready, willing, and able buyer to a seller. In MOST listing contracts, the broker has earned his commission when ✔✔the seller accepts the offer. A seller mentions to his agent that the previous owners of his property may have dumped hazardous waste on the site. Under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), who is liable for damages from the dumping prior to the sale of the property? ✔✔Seller. A seller tells the listing agent that her home was treated for termites 10 years ago, so there are no termites now. Before listing the property, the agent should ✔✔Tell the seller to disclose the termite treatment on the property disclosure. Without checking the facts, a broker who is the seller's agent tells a buyer that the property taxes in a particular neighborhood are among the lowest in the area. The buyer relies on the broker's statement and makes an offer on a house in the neighborhood. Before closing, it is determined that the taxes are actually among the highest in the area. The buyer could seek to rescind the contract on the basis of ✔✔misrepresentation. The real estate broker who is listing a house for sale should personally verify ✔✔the number of sq feet in the building. The Department of Housing and Urban Development estimates that most private homes build before 1978 contain potentially dangerous levels of lead. Because of this, some Federal agencies, such as FHA, ✔✔require the buyer to acknowledge disclosure of the presence of any known lead paint. At the time of listing, the seller tells the listing agent they are moving because the neighbor has loud parties every weekend. The agent should ✔✔tell potential buyers about the parties. Prospective buyers made an offer on a property. The seller did NOT accept, but made a counteroffer. The prospective buyers signed the counteroffer and the real estate agent delivered their acceptance to the seller. In the interim, the same buyers had found another house that they liked better and made an offer on it, which was accepted. Which of the following is TRUE? ✔✔both contracts are valid. A written agreement in which a purchaser agrees to buy and a seller agrees to sell is called ✔✔a contract The document used in a real estate sale that establishes the legal rights of the buyer and seller is the ✔✔purchase contract. A company agrees to lease a property to be used as a gambling casino. State laws prohibit gambling. This particular contract would be legally defined as ✔✔void. A prospective buyer made an offer to purchase a property. The owner responded with a counteroffer. While the buyer was reviewing the counteroffer, the owner received a better offer. The owner can accept the second offer if ✔✔the owner withdraws the counteroffer before it is accepted. A couple signed a lease on an apartment for a period of 1 year. The lease does NOT contain an automatic renewal clause. The couple plans to move out at the end of the lease rather than renew it. How much notice MUSt they give to comply with the lease term? ✔✔no notice is required. A contract has been drawn which obliges the sellers to convey title to their land to the buyers if the buyers come up with $22,000 on or before December 31st. This is called ✔✔an option contract. [Show More]

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