OK PSI REAL ESTATE UPDATED ACTUAL FINAL PAPER
QUESTIONS AND SOLUTIONS GUARANTEE A+
✔✔The Veterans Administration assists numerous qualified mortgage loan applicants
because it - ✔✔guarantees loans made by approved lenders
✔✔This loan type is characterized by equal monthly payments credited first to interest
due. Then, the remainder of the payment is applied to the loan balance - ✔✔Amortized
Loan
✔✔If an area containing a service station were changed to residential zoning, the
service station - ✔✔is a non-conforming use
✔✔A gated community has a restrictive covenant that dictates fences can be no taller
than 5 feet. The city code states a max height of 6 feet. A homeowner in the community
builds a 6-foot high fence. The Board of Director's sue. What is the Court's ruling? -
✔✔The restrictive covenant takes precedence because it is more restrictive
✔✔The Ad reads, "Your new home has the most stunning view in the county." Is there a
problem? - ✔✔No. This is puffing.
✔✔A broker has a listing contract on a vacant house. It has taken longer to sell than
anticipated. The broker hires a lawn company to mow. Who owes the mower? - ✔✔The
Broker
✔✔Which of the following is NOT a type of possible Agency Relationship in a
transaction unless all parties acknowledge the relationship? - ✔✔Dual Agency
✔✔A buyer representative locates a suitable property through an owner broker. The
buyer buys the property; the seller pays a commission and the two agents split the
commission. In this instance, the owner broker is acting as - ✔✔a single agent for the
owner
✔✔A sales associate lists a property. Three weeks later, the sales associate os
tragically killed on the way to show the property. What is the status of the Listing
Contract? - ✔✔Agency remains unaltered
✔✔When a realtor and a seller sign a listing contract, the broker becomes - ✔✔special
agent
✔✔Under a special agency agreement, a broker is not authorized to - ✔✔execute a
contract for sale agreement
,✔✔A Buyer inquires to the Listing Broker (who reps the seller) why the seller is selling
and what is the lowest price the seller would accept. The listing broker should - ✔✔not
answer the questions as loyalty to the seller
✔✔A realtor goes through the entire transaction with a Buyer w/o signing a contract to
represent the buyer. Is this legal; and if so, what type of agency exists? - ✔✔Yes
Implied Agency
✔✔Real estate brokers authorized to conduct a single transaction for their principals are
usually classed as - ✔✔special agents
✔✔A seller and a broker signed a contract to market a house. After 63 days on the
market, the seller called the broker to say, "Thanks," but the seller had found a buyer.
What kind of listing is this? - ✔✔Exclusive Agency Listing
✔✔An agent fails to discover crumbling tiles on the basement ceiling beneath a
bathroom. The agent sells the property, and the buyer later sues the agent for not
discovering and disclosing a clearly visible and obvious problem. In this case, the agent
- ✔✔has an exposure to negligent misrepresentation
✔✔What is the primary aim of a marketing program for a managed property? - ✔✔To
find and attract the right kind of tenants
✔✔The most common kind of landlord default is - ✔✔failure to maintain the property
and provide services
✔✔How does the ECOA affect property managers? - ✔✔Managers must be consistent
and nondiscriminatory in evaluating the creditworthiness of tenant applicants
✔✔Typically before a mortgage company will finance a home they will want to make
sure there are no encroachments on the property they are financing. To check for any
encroachments the mortgage company should order a - ✔✔survey
✔✔A toxic waste dump is located at the edge of town. What federal legislation would
force the clean up of this area? - ✔✔CERCLA
✔✔Which of the following is NOT a latent defect? - ✔✔A crack in the living room ceiling
✔✔Any agreement between two or more brokers in competition with one another to fix,
control, regulate, increase, decrease or stabilize fees, rates, commissions or other
prices - ✔✔is price fixing, illegal, and cannot be defended on any grounds
,✔✔Unintentional misrepresentation is generally considered - ✔✔less serious than
intentional fraud but still a violation to be punished
✔✔The illegal practice of sending potential home buyers or renters to equivalent
properties in particular areas in order to maintain the homogeneity of an area is called -
✔✔steering
✔✔The primary jeopardy of overpricing a property is that - ✔✔the client's expectations
may not be achieved
✔✔All of the following are illegal activities involving fair housing except - ✔✔declaring
an apartment complex only for 62 y/o or over
✔✔Albert who is a broker went to get a listing on a piece of property Bill was wanting to
sell. Bill indicated to Albert that he did not want his house sold to an Hispanic. Which of
the following should Albert do? - ✔✔refuse to list the property
✔✔A family is looking for a home in a certain price range. The wife suggests several
listing on the east side of town, and the agent agrees to show the family the suggested
properties. En route to the targeted neighborhood, the agent drives a certain route to
show the family certain retail services and two schools. What has the agent done
wrong? - ✔✔He has done nothing wrong
✔✔The primary purpose of the Truth in Lending Act part of TRID is to - ✔✔disclose to
the consumer the cost and conditions of the installment purchase
✔✔A kind of insurance that provides coverage for losses resulting from the criminal acts
of an employee is - ✔✔surety bond
✔✔A broker and sales person agree to a 40-60 commission split. This commission rate
- ✔✔is probably a reflection of a competitive market conditions
✔✔The Listing Agent decided to "spice-up" the advertisement by stating, "Only $50
down and $500 a month get you a new Home!" Whats the problem? - ✔✔Violates
Regulation Z
✔✔What is the time limitation for reporting alleged violations of the Federal Fair
Housing Act and Amendments - ✔✔365 days
✔✔At the direction of a seller-client, an agent tells a pregnant woman that the property
is not in a good neighborhood for a single woman, particularly if she regularly works late
hours. The neighborhood has an increasing crime rate, and people are moving out.
What has this agent done wrong? - ✔✔Engaged in steering
, ✔✔This law prohibited racial discrimination in the buying, selling, holding, or conveying
of real and personal property? - ✔✔Civil Rights Act of 1866
✔✔Real Estate described as the NE 1/4 of the SW 1/4 of Section 4, Township 3 North,
Range 2 East of the Cimarron Meridian would be which legal description? -
✔✔Rectangular Survey
✔✔A miner openly lives and prospects on a 20,000-acre ranch. After twenty years, the
owner notices the miner and kicks him off the property. The miner makes a claim of
ownership to the property. This claim will likely be - ✔✔upheld, because the possession
was not concealed
✔✔A tract of land is described as the W 1/2 of the N 1/2 of the NE 1/4 of section 16.
What is the acreage? - ✔✔40 acres
✔✔Which of the following is a six-mile strip running parallel to the meridian? - ✔✔range
✔✔The largest estate one can hold in land is a - ✔✔fee simple estate
✔✔Over time, a parcel of land lost access to a county road. The land owner had to
obtain access to the road by court action. This is an example of - ✔✔Easement by
Necessity
✔✔A good way to determine if violations or encroachments exist is to - ✔✔have a
survey performed
✔✔When the title to real estate is vested in one person or entity (such as a corporation),
that person or organization is said to own an - ✔✔estate in severalty
✔✔A property has a net income of $50,000, interest payments of $35,000, principal
payments of $7,000. The property's tax rate is 28%. What is the property's annual tax
on income? - ✔✔$2,240
✔✔Ten years ago, an office building cost $500,000 to build plus $200,000 for the land.
Yesterday an appraiser estimated the replacement cost at $the 650,000 and a useful
life of 50 years. What is the depreciation to date? - ✔✔$130,000
✔✔A borrower grosses $4,000/month and pays $600/month for debt obligations. What
monthly payment for housing expenses (principal, interest, taxes, insurance) can this
person afford based on an FHA debt ratio of 41%? - ✔✔$1,040
QUESTIONS AND SOLUTIONS GUARANTEE A+
✔✔The Veterans Administration assists numerous qualified mortgage loan applicants
because it - ✔✔guarantees loans made by approved lenders
✔✔This loan type is characterized by equal monthly payments credited first to interest
due. Then, the remainder of the payment is applied to the loan balance - ✔✔Amortized
Loan
✔✔If an area containing a service station were changed to residential zoning, the
service station - ✔✔is a non-conforming use
✔✔A gated community has a restrictive covenant that dictates fences can be no taller
than 5 feet. The city code states a max height of 6 feet. A homeowner in the community
builds a 6-foot high fence. The Board of Director's sue. What is the Court's ruling? -
✔✔The restrictive covenant takes precedence because it is more restrictive
✔✔The Ad reads, "Your new home has the most stunning view in the county." Is there a
problem? - ✔✔No. This is puffing.
✔✔A broker has a listing contract on a vacant house. It has taken longer to sell than
anticipated. The broker hires a lawn company to mow. Who owes the mower? - ✔✔The
Broker
✔✔Which of the following is NOT a type of possible Agency Relationship in a
transaction unless all parties acknowledge the relationship? - ✔✔Dual Agency
✔✔A buyer representative locates a suitable property through an owner broker. The
buyer buys the property; the seller pays a commission and the two agents split the
commission. In this instance, the owner broker is acting as - ✔✔a single agent for the
owner
✔✔A sales associate lists a property. Three weeks later, the sales associate os
tragically killed on the way to show the property. What is the status of the Listing
Contract? - ✔✔Agency remains unaltered
✔✔When a realtor and a seller sign a listing contract, the broker becomes - ✔✔special
agent
✔✔Under a special agency agreement, a broker is not authorized to - ✔✔execute a
contract for sale agreement
,✔✔A Buyer inquires to the Listing Broker (who reps the seller) why the seller is selling
and what is the lowest price the seller would accept. The listing broker should - ✔✔not
answer the questions as loyalty to the seller
✔✔A realtor goes through the entire transaction with a Buyer w/o signing a contract to
represent the buyer. Is this legal; and if so, what type of agency exists? - ✔✔Yes
Implied Agency
✔✔Real estate brokers authorized to conduct a single transaction for their principals are
usually classed as - ✔✔special agents
✔✔A seller and a broker signed a contract to market a house. After 63 days on the
market, the seller called the broker to say, "Thanks," but the seller had found a buyer.
What kind of listing is this? - ✔✔Exclusive Agency Listing
✔✔An agent fails to discover crumbling tiles on the basement ceiling beneath a
bathroom. The agent sells the property, and the buyer later sues the agent for not
discovering and disclosing a clearly visible and obvious problem. In this case, the agent
- ✔✔has an exposure to negligent misrepresentation
✔✔What is the primary aim of a marketing program for a managed property? - ✔✔To
find and attract the right kind of tenants
✔✔The most common kind of landlord default is - ✔✔failure to maintain the property
and provide services
✔✔How does the ECOA affect property managers? - ✔✔Managers must be consistent
and nondiscriminatory in evaluating the creditworthiness of tenant applicants
✔✔Typically before a mortgage company will finance a home they will want to make
sure there are no encroachments on the property they are financing. To check for any
encroachments the mortgage company should order a - ✔✔survey
✔✔A toxic waste dump is located at the edge of town. What federal legislation would
force the clean up of this area? - ✔✔CERCLA
✔✔Which of the following is NOT a latent defect? - ✔✔A crack in the living room ceiling
✔✔Any agreement between two or more brokers in competition with one another to fix,
control, regulate, increase, decrease or stabilize fees, rates, commissions or other
prices - ✔✔is price fixing, illegal, and cannot be defended on any grounds
,✔✔Unintentional misrepresentation is generally considered - ✔✔less serious than
intentional fraud but still a violation to be punished
✔✔The illegal practice of sending potential home buyers or renters to equivalent
properties in particular areas in order to maintain the homogeneity of an area is called -
✔✔steering
✔✔The primary jeopardy of overpricing a property is that - ✔✔the client's expectations
may not be achieved
✔✔All of the following are illegal activities involving fair housing except - ✔✔declaring
an apartment complex only for 62 y/o or over
✔✔Albert who is a broker went to get a listing on a piece of property Bill was wanting to
sell. Bill indicated to Albert that he did not want his house sold to an Hispanic. Which of
the following should Albert do? - ✔✔refuse to list the property
✔✔A family is looking for a home in a certain price range. The wife suggests several
listing on the east side of town, and the agent agrees to show the family the suggested
properties. En route to the targeted neighborhood, the agent drives a certain route to
show the family certain retail services and two schools. What has the agent done
wrong? - ✔✔He has done nothing wrong
✔✔The primary purpose of the Truth in Lending Act part of TRID is to - ✔✔disclose to
the consumer the cost and conditions of the installment purchase
✔✔A kind of insurance that provides coverage for losses resulting from the criminal acts
of an employee is - ✔✔surety bond
✔✔A broker and sales person agree to a 40-60 commission split. This commission rate
- ✔✔is probably a reflection of a competitive market conditions
✔✔The Listing Agent decided to "spice-up" the advertisement by stating, "Only $50
down and $500 a month get you a new Home!" Whats the problem? - ✔✔Violates
Regulation Z
✔✔What is the time limitation for reporting alleged violations of the Federal Fair
Housing Act and Amendments - ✔✔365 days
✔✔At the direction of a seller-client, an agent tells a pregnant woman that the property
is not in a good neighborhood for a single woman, particularly if she regularly works late
hours. The neighborhood has an increasing crime rate, and people are moving out.
What has this agent done wrong? - ✔✔Engaged in steering
, ✔✔This law prohibited racial discrimination in the buying, selling, holding, or conveying
of real and personal property? - ✔✔Civil Rights Act of 1866
✔✔Real Estate described as the NE 1/4 of the SW 1/4 of Section 4, Township 3 North,
Range 2 East of the Cimarron Meridian would be which legal description? -
✔✔Rectangular Survey
✔✔A miner openly lives and prospects on a 20,000-acre ranch. After twenty years, the
owner notices the miner and kicks him off the property. The miner makes a claim of
ownership to the property. This claim will likely be - ✔✔upheld, because the possession
was not concealed
✔✔A tract of land is described as the W 1/2 of the N 1/2 of the NE 1/4 of section 16.
What is the acreage? - ✔✔40 acres
✔✔Which of the following is a six-mile strip running parallel to the meridian? - ✔✔range
✔✔The largest estate one can hold in land is a - ✔✔fee simple estate
✔✔Over time, a parcel of land lost access to a county road. The land owner had to
obtain access to the road by court action. This is an example of - ✔✔Easement by
Necessity
✔✔A good way to determine if violations or encroachments exist is to - ✔✔have a
survey performed
✔✔When the title to real estate is vested in one person or entity (such as a corporation),
that person or organization is said to own an - ✔✔estate in severalty
✔✔A property has a net income of $50,000, interest payments of $35,000, principal
payments of $7,000. The property's tax rate is 28%. What is the property's annual tax
on income? - ✔✔$2,240
✔✔Ten years ago, an office building cost $500,000 to build plus $200,000 for the land.
Yesterday an appraiser estimated the replacement cost at $the 650,000 and a useful
life of 50 years. What is the depreciation to date? - ✔✔$130,000
✔✔A borrower grosses $4,000/month and pays $600/month for debt obligations. What
monthly payment for housing expenses (principal, interest, taxes, insurance) can this
person afford based on an FHA debt ratio of 41%? - ✔✔$1,040
