NEW MEXICO REAL ESTATE LAW QUESTIONS WITH CORRECT VERIFIED ANSWERS AND RATIONALE | 100% PASS (A+ CERTIFIED)

A broker is performing as a property manager and deposits rent into her operating account. This is an example of which of the following? Answer COMMINGLING. Mixing a broker's money with a client's money is commingling (and illegal). A lessee has the greatest protection with a(n) Answer ESTATE FOR YEARS. An estate for years locks the holder into the lease for a specific period of time, which cannot be terminated without cause, even if the property is sold. A broker who has done a proper CMA discusses the probable market value of the property with the seller, but the seller wants to list the property for an unrealistic price. The broker may do all the following EXCEPT Answer TAKE THE LISTING AT THE PROPOSED SELLER'S PRICE, PLANNING ON REDUCING THE PRICE IN THE FUTURE WHEN THE SELLER IS MORE REALISTIC. Whether a CMA or a formal appraisal is used, the figure sought is the property's market value, and while it is the property owner's privilege to set whatever listing price the owner chooses, a broker should consider rejecting any listing that is severely out of line. What is the LEAST specific method for identifying real property? Answer STREET ADDRESS. A legal description is a precise method of identifying a parcel of land and includes metes and bounds, rectangular survey, and lot and block as methods for identification. A street address is not a legal description and, therefore, not as precise. The disadvantage of a buyer receiving a quitclaim deed is that Answer THE GRANTOR MAKES NO WARRANTIES REGARDING THE TITLE OF THE PROPERTY. The quitclaim deed contains no warranties and only states that if the grantor owns the property, the property will become the grantee's. A property owner contracted to have a swimming pool installed on her property. When the pool was complete, she refused to pay for the improvement, and the contractor filed a lien for nonpayment. This lien was MOST likely a Answer MECHANIC'S LIEN. The lien filed by the contractor would be a mechanic's lien and would be a specific, involuntary lien on the property. Which of the following is an example of involuntary alienation? Answer ADVERSE POSSESSION. Involuntary alienation means a property owner is forced to give ownership to all or a portion of the property involuntarily. Of the answer choices, only adverse possession represents such a case. When another individual meets the adverse possession criteria for the required length of time, the individual can go to court and obtain title to the property. An exercise room in a condominium development is considered to be a common element owned by Answer ALL CURRENT OWNERS AS TENANTS IN COMMON. All owners would be able to use the exercise room, so it is known as a common element. An example of a limited common element is a balcony because only the unit owner would be allowed (limited) to use it. According to the law, a trade fixture is usually treated as Answer PERSONAL PROPERTY. An item used in conducting business is considered a trade fixture and can be removed by the tenant. It is considered personal property (personalty), even though it may be attached to a building. A description that states, "start at the street sign at the corner of Ash and 11th, go 100 feet south, then 50 feet west" is MOST likely what type of legal description? Answer METES AND BOUNDS. Metes-and-bounds descriptions use starting points and read in a clockwise direction. Which is an example of constructive eviction? Answer A TENANT WHO MOVES BECAUSE THE UNIT NO LONGER HAS WATER. When conditions cause a rental unit to no longer be habitable, the renter has constructive eviction. Without water, a tenant is unable to bathe, cook, wash clothes, and so on. The tenant must leave, not just withhold rent. A deed conveying land to two parties on a 1/3 and 2/3 share basis establishes a Answer TENANCY IN COMMON. Only tenants in common can have