TREC FINAL EXAM
which element of a valid contract states that the contract cannot require any illegal activities? - Answer-
lawful objective
which of these is the best example of stigmatized property? - Answer-home where a notorious
convicted murderer once lived
A property owner has the right to tell other people that they cannot trespass on their property. What is
this right called? - Answer-right of exclusion
which type of listing agreement is most likely to cause a conflict of interest, and is therefor discouraged?
- Answer-net listing
Which of these is n economic characteristic that makes land a distinctive commodity? - Answer-situs
Darla is suing Arlo for specific performance. If she is successful, what will happen? - Answer-Arlo will be
required to perform according to the terms of the contract
What is the term for deliberate deception done with the intention of gaining something of value or
causing damage to another person? - Answer-fraud
Liability for others by mandate of law or by express agreement is called: - Answer-vicarious liability
who provides flood insurance to homeowners? - Answer-the National Flood Insurance Program (NFIP)
,personal property MUST be transferred via: - Answer-bill of sale
when Shondra originally bought her house, she made a 30% down payment on the $600,000 purchase.
Assuming that she has been paying towards her principal in the amount of $1,600 monthly for five
years. How much equity does she now have in the house? - Answer-$276,000.
a buyer representation agreement establishes an agency relationship between a buyer and a: - Answer-
broker
a debit to the buyer has what effect on charges made to the parties involved in the transaction? -
Answer-increases the amount due from the buyer at closing
which of these is an easement that is attached to a piece of land, regardless of owner? - Answer-
easement appurtenant
Joel was told by a lender the highest leverage he could achieve was a loan-to-value ratio of 75%. His loan
principal is $315,000. What is the total purchase price? - Answer-$420,000
what act is prohibited by the Sherman Antitrust Act? - Answer-price fixing
suppose that a borrower has a gross monthly income of $3,000 and wants to qualify for conforming loan
(total debt service ratio of 36%) with a monthly PITI payment of $800. What is the maximum amount of
additional long-term obligations this borrower may have after PITI? - Answer-$280
Darleene is looking at an investment property. The annual net operating income (NOI) of the property is
$310,000. If the capitalization rate for this class of property in this area is currently 9%, what is the total
value of this property? - Answer-$3,444,444.44
The term for when the client initiates the termination of the agency agreement is known as: - Answer-
revocation
,A married couple bought a home ten years ago for $400,000. Their neighborhood has rapidly grown in
popularity, and they were able to sell their home this year for $950,000. How much of that money will
hey be required to pay capital gains tax on? - Answer-$50,000
What type of listing provides a commission to the broker ONLY if their activities bring about a sale? -
Answer-open
when you're talking about mortgages, what is another name for an origination fee? - Answer-points
which federal law amended the comprehensive environmental response, compensation, and liability act
(CERCLA)? - Answer-superfund amendments and reauthorization act (SARA)
A Christian organization owns a fourplex. It wants to rent to only Christian tenants. Under the federal
Fair Housing Act, is this legal? - Answer-Yes. Religious organizations which rent to tenants for residential
purposes are exempt from the Fair Housing Act?
All federally related loan programs require a property to have which of these? - Answer-an appraisal
To be considered a legally competent party to a contract, a person must: - Answer-have reached the age
of majority and be of sound mind
Most of the smaller, older homes on Ridgedale Street have been majorly renovated or torn down and
replaced with high-value homes. 15320 Ridgedale St. is now the smallest, shabbiest home on the block,
but it recently appraised for more than a similar home in a less-upgraded neighborhood. What principle
of value explains this? - Answer-Principal of progression
With intermediary with appointments, who would be considered the intermediary? - Answer-the broker
only
, What is an environmental impact statement? - Answer-a detailed written statement required by the
National Environmental Policy Act for a proposed action significantly affecting the environment
The most common type of agency between brokers and their sales agents is: - Answer-general agency
What does it mean if a contract is executory? - Answer-The terms of a contract have not yet been fully
performed by both parties
The statute of frauds states some leases must be in writing while others do not need to be in writing.
Which of the following is TRUE? - Answer-Leases lasting for a term of longer than one year must be in
writing
TREC's Consumer Protection Notice, which is to be displayed prominently in every broker's place of
business, serves to: - Answer-Provide Commission contract information for the purpose of directing
complaints from the public
Conventional loans are divided into two categories. They are: - Answer-Conforming and non-conforming
Which of these conditions must be met if you are going to advertise services as a real estate team? -
Answer-The team name must be registered with TREC before the name can be used in advertising
An oral contract to buy a piece of real estate is unenforceable because it does not comply with the
statute of: - Answer-frauds
How many square feet are in an acre? - Answer-43,560 square feet
What type of tenancy does a holdover tenant have? - Answer-tenancy at sufferance
Which term best describes annually cultivated crops? - Answer-emblements
which element of a valid contract states that the contract cannot require any illegal activities? - Answer-
lawful objective
which of these is the best example of stigmatized property? - Answer-home where a notorious
convicted murderer once lived
A property owner has the right to tell other people that they cannot trespass on their property. What is
this right called? - Answer-right of exclusion
which type of listing agreement is most likely to cause a conflict of interest, and is therefor discouraged?
- Answer-net listing
Which of these is n economic characteristic that makes land a distinctive commodity? - Answer-situs
Darla is suing Arlo for specific performance. If she is successful, what will happen? - Answer-Arlo will be
required to perform according to the terms of the contract
What is the term for deliberate deception done with the intention of gaining something of value or
causing damage to another person? - Answer-fraud
Liability for others by mandate of law or by express agreement is called: - Answer-vicarious liability
who provides flood insurance to homeowners? - Answer-the National Flood Insurance Program (NFIP)
,personal property MUST be transferred via: - Answer-bill of sale
when Shondra originally bought her house, she made a 30% down payment on the $600,000 purchase.
Assuming that she has been paying towards her principal in the amount of $1,600 monthly for five
years. How much equity does she now have in the house? - Answer-$276,000.
a buyer representation agreement establishes an agency relationship between a buyer and a: - Answer-
broker
a debit to the buyer has what effect on charges made to the parties involved in the transaction? -
Answer-increases the amount due from the buyer at closing
which of these is an easement that is attached to a piece of land, regardless of owner? - Answer-
easement appurtenant
Joel was told by a lender the highest leverage he could achieve was a loan-to-value ratio of 75%. His loan
principal is $315,000. What is the total purchase price? - Answer-$420,000
what act is prohibited by the Sherman Antitrust Act? - Answer-price fixing
suppose that a borrower has a gross monthly income of $3,000 and wants to qualify for conforming loan
(total debt service ratio of 36%) with a monthly PITI payment of $800. What is the maximum amount of
additional long-term obligations this borrower may have after PITI? - Answer-$280
Darleene is looking at an investment property. The annual net operating income (NOI) of the property is
$310,000. If the capitalization rate for this class of property in this area is currently 9%, what is the total
value of this property? - Answer-$3,444,444.44
The term for when the client initiates the termination of the agency agreement is known as: - Answer-
revocation
,A married couple bought a home ten years ago for $400,000. Their neighborhood has rapidly grown in
popularity, and they were able to sell their home this year for $950,000. How much of that money will
hey be required to pay capital gains tax on? - Answer-$50,000
What type of listing provides a commission to the broker ONLY if their activities bring about a sale? -
Answer-open
when you're talking about mortgages, what is another name for an origination fee? - Answer-points
which federal law amended the comprehensive environmental response, compensation, and liability act
(CERCLA)? - Answer-superfund amendments and reauthorization act (SARA)
A Christian organization owns a fourplex. It wants to rent to only Christian tenants. Under the federal
Fair Housing Act, is this legal? - Answer-Yes. Religious organizations which rent to tenants for residential
purposes are exempt from the Fair Housing Act?
All federally related loan programs require a property to have which of these? - Answer-an appraisal
To be considered a legally competent party to a contract, a person must: - Answer-have reached the age
of majority and be of sound mind
Most of the smaller, older homes on Ridgedale Street have been majorly renovated or torn down and
replaced with high-value homes. 15320 Ridgedale St. is now the smallest, shabbiest home on the block,
but it recently appraised for more than a similar home in a less-upgraded neighborhood. What principle
of value explains this? - Answer-Principal of progression
With intermediary with appointments, who would be considered the intermediary? - Answer-the broker
only
, What is an environmental impact statement? - Answer-a detailed written statement required by the
National Environmental Policy Act for a proposed action significantly affecting the environment
The most common type of agency between brokers and their sales agents is: - Answer-general agency
What does it mean if a contract is executory? - Answer-The terms of a contract have not yet been fully
performed by both parties
The statute of frauds states some leases must be in writing while others do not need to be in writing.
Which of the following is TRUE? - Answer-Leases lasting for a term of longer than one year must be in
writing
TREC's Consumer Protection Notice, which is to be displayed prominently in every broker's place of
business, serves to: - Answer-Provide Commission contract information for the purpose of directing
complaints from the public
Conventional loans are divided into two categories. They are: - Answer-Conforming and non-conforming
Which of these conditions must be met if you are going to advertise services as a real estate team? -
Answer-The team name must be registered with TREC before the name can be used in advertising
An oral contract to buy a piece of real estate is unenforceable because it does not comply with the
statute of: - Answer-frauds
How many square feet are in an acre? - Answer-43,560 square feet
What type of tenancy does a holdover tenant have? - Answer-tenancy at sufferance
Which term best describes annually cultivated crops? - Answer-emblements
