CA Real Estate Exam Prep-
Comprehensive Practice Exam
Questions & Detailed Answers
Preliminary report - correct answer ✔✔Which document is used to give a buyer an overview of
the title history and information about what is or isn't covered in an insurance policy?
$842.74 - correct answer ✔✔Buyer Maria and seller Doug are closing on June 1. Maria's
mortgage loan is $927.86, and $871.86 will go to interest in the first month. Maria will have to
pre-pay interest for June using the 360-day proration method. If Doug owns the closing day,
what Maria's prepaid interest cost be at closing?
B. It's easier to build on a blank canvas than it is to retrofit existing infrastructure. - correct
answer ✔✔Which of the following is one of the primary reasons that developers like to invest in
unimproved land?
A. It looks good to top investors to have a portfolio of unimproved land.
B. It's easier to build on a blank canvas than it is to retrofit existing infrastructure.
C. It's profitable immediately.
D. Structures are already erected on the land, limiting the development that needs to be done.
You recommend that Peter check on the permits for it, so that he doesn't buy the house and
then have to correct or even remove the addition because it wasn't built to code. - correct
answer ✔✔Buyer Peter is eager to make an offer on the two-story home you just showed him,
,but you're concerned about the back bedroom, since it looks like a relatively recent addition.
When Peter asks you why it's an issue, how do you respond?
Attached accessory apartment - correct answer ✔✔According to national standards for
measuring square footage of a dwelling, which space should be included?
Uniqueness - correct answer ✔✔Which physical characteristic of land addresses the concept
that land isn't interchangeable, and one piece of land isn't exactly like another?
One that meets stringent CFPB guidelines - correct answer ✔✔What's the definition of a
qualified mortgage?
None - correct answer ✔✔Jim would like to sell his own home. What is the minimum real estate
license he must possess?
140 (100%) - correct answer ✔✔Jason, your client, is developing a subdivision of 140 houses.
He may place deed restrictions on as many as ______ properties.
18 - correct answer ✔✔How old must an individual be to qualify for a real estate broker license
in California?
Dodd-Frank Wall Street Reform and Consumer Protection Act - correct answer ✔✔The ______
was enacted in 2010 to create stricter regulation of the financial services industry to reduce
costs for consumers from (for instance), undisclosed kickbacks.
Stock cooperative project - correct answer ✔✔In which type of common interest subdivision
are the owner's shareholders in a corporation that owns the property?
Specific and involuntary - correct answer ✔✔Which option describes a real property tax lien?
,Principals - correct answer ✔✔Mark is offering to purchase Sarah's house. They agree, and
open an escrow account together. Mark and Sarah would be considered what to the escrow?
To provide the estimated closing costs for Lawrence's loan - correct answer ✔✔Lawrence is a
buyer closing on a home purchase for which he's obtaining financing. He receives a Loan
Estimate from his lender. What's one purpose of this document?
Estate at sufferance - correct answer ✔✔Non-lawful possession after the expiration of a lease is
called ______.
Escheat - correct answer ✔✔What is it called when property is taken by the state after the
owner dies without heirs?
Compare the competition to the rates, condition, amenities, and location of the owner's
property - correct answer ✔✔To develop a marketing plan for the property owner, the property
manager should ______.
Immediately upon issuance - correct answer ✔✔Lot and Block Realty received a cease-and-
desist order from the FTC due to misleading ads the firm was running. When does the order
become effective?
Subprime - correct answer ✔✔Borrowers who fall into the ______ category may be faced with
paying interest 1% to 5% over the current market rate.
Recommend that the Arnolds review the sales contract with an attorney before signing it. -
correct answer ✔✔Reggie has thoroughly reviewed the sales contract with his clients, the
Arnolds, and has confirmed that they understand all of the terms and provisions. What should
Reggie do next?
, Late charge provision - correct answer ✔✔What's the name of the clause in a promissory note
where this language appears: "If the Note Holder has not received the full amount of any
monthly payment by the end of ______ calendar days after the date it is due, I will pay a late
charge to the Note Holder"?
Tie-in arrangement - correct answer ✔✔Which type of antitrust violation occurs when the
providing of one service is made dependent on the customer or client obtaining another
recommended service?
If he is preparing his house to sell - correct answer ✔✔Kenny is updating a bathroom. Under
what circumstances is a contractor's license required?
Tie-in arrangement - correct answer ✔✔When working with a developer who's purchasing
undeveloped land for a new subdivision, ABC Realty stipulates in the contract that in order to
purchase the undeveloped land, the developer must purchase grading services from Bulldozers-
R-Us. Which antitrust violation is this?
Bulk zoning - correct answer ✔✔One area of town has maximum building height requirements
and setbacks for the front, side, and rear yards. These requirements are all indicative of ______.
850 square feet - correct answer ✔✔Margie needs to know the square footage for the first floor
of the condo her client is interested in buying. The kitchen is 10 feet by 15 feet, the living/dining
combo is 20 feet by 25 feet, and the office and bedroom are each 10 feet by 10 feet. What's the
total square footage?
$1,110.64 - correct answer ✔✔A buyer with a 20-year, $419,000 loan at a 4.25% interest rate
has a monthly principal and interest payment totaling $2,594.59. If $1,483.95 is interest, how
much is applied toward principal for that payment
Document the issue on the AVID form and attach it to the TDS. - correct answer ✔✔During your
visual inspection of a property that you are listing for sale, you notice some termite damage on
two of the doorsills. How should you report this issue?
Comprehensive Practice Exam
Questions & Detailed Answers
Preliminary report - correct answer ✔✔Which document is used to give a buyer an overview of
the title history and information about what is or isn't covered in an insurance policy?
$842.74 - correct answer ✔✔Buyer Maria and seller Doug are closing on June 1. Maria's
mortgage loan is $927.86, and $871.86 will go to interest in the first month. Maria will have to
pre-pay interest for June using the 360-day proration method. If Doug owns the closing day,
what Maria's prepaid interest cost be at closing?
B. It's easier to build on a blank canvas than it is to retrofit existing infrastructure. - correct
answer ✔✔Which of the following is one of the primary reasons that developers like to invest in
unimproved land?
A. It looks good to top investors to have a portfolio of unimproved land.
B. It's easier to build on a blank canvas than it is to retrofit existing infrastructure.
C. It's profitable immediately.
D. Structures are already erected on the land, limiting the development that needs to be done.
You recommend that Peter check on the permits for it, so that he doesn't buy the house and
then have to correct or even remove the addition because it wasn't built to code. - correct
answer ✔✔Buyer Peter is eager to make an offer on the two-story home you just showed him,
,but you're concerned about the back bedroom, since it looks like a relatively recent addition.
When Peter asks you why it's an issue, how do you respond?
Attached accessory apartment - correct answer ✔✔According to national standards for
measuring square footage of a dwelling, which space should be included?
Uniqueness - correct answer ✔✔Which physical characteristic of land addresses the concept
that land isn't interchangeable, and one piece of land isn't exactly like another?
One that meets stringent CFPB guidelines - correct answer ✔✔What's the definition of a
qualified mortgage?
None - correct answer ✔✔Jim would like to sell his own home. What is the minimum real estate
license he must possess?
140 (100%) - correct answer ✔✔Jason, your client, is developing a subdivision of 140 houses.
He may place deed restrictions on as many as ______ properties.
18 - correct answer ✔✔How old must an individual be to qualify for a real estate broker license
in California?
Dodd-Frank Wall Street Reform and Consumer Protection Act - correct answer ✔✔The ______
was enacted in 2010 to create stricter regulation of the financial services industry to reduce
costs for consumers from (for instance), undisclosed kickbacks.
Stock cooperative project - correct answer ✔✔In which type of common interest subdivision
are the owner's shareholders in a corporation that owns the property?
Specific and involuntary - correct answer ✔✔Which option describes a real property tax lien?
,Principals - correct answer ✔✔Mark is offering to purchase Sarah's house. They agree, and
open an escrow account together. Mark and Sarah would be considered what to the escrow?
To provide the estimated closing costs for Lawrence's loan - correct answer ✔✔Lawrence is a
buyer closing on a home purchase for which he's obtaining financing. He receives a Loan
Estimate from his lender. What's one purpose of this document?
Estate at sufferance - correct answer ✔✔Non-lawful possession after the expiration of a lease is
called ______.
Escheat - correct answer ✔✔What is it called when property is taken by the state after the
owner dies without heirs?
Compare the competition to the rates, condition, amenities, and location of the owner's
property - correct answer ✔✔To develop a marketing plan for the property owner, the property
manager should ______.
Immediately upon issuance - correct answer ✔✔Lot and Block Realty received a cease-and-
desist order from the FTC due to misleading ads the firm was running. When does the order
become effective?
Subprime - correct answer ✔✔Borrowers who fall into the ______ category may be faced with
paying interest 1% to 5% over the current market rate.
Recommend that the Arnolds review the sales contract with an attorney before signing it. -
correct answer ✔✔Reggie has thoroughly reviewed the sales contract with his clients, the
Arnolds, and has confirmed that they understand all of the terms and provisions. What should
Reggie do next?
, Late charge provision - correct answer ✔✔What's the name of the clause in a promissory note
where this language appears: "If the Note Holder has not received the full amount of any
monthly payment by the end of ______ calendar days after the date it is due, I will pay a late
charge to the Note Holder"?
Tie-in arrangement - correct answer ✔✔Which type of antitrust violation occurs when the
providing of one service is made dependent on the customer or client obtaining another
recommended service?
If he is preparing his house to sell - correct answer ✔✔Kenny is updating a bathroom. Under
what circumstances is a contractor's license required?
Tie-in arrangement - correct answer ✔✔When working with a developer who's purchasing
undeveloped land for a new subdivision, ABC Realty stipulates in the contract that in order to
purchase the undeveloped land, the developer must purchase grading services from Bulldozers-
R-Us. Which antitrust violation is this?
Bulk zoning - correct answer ✔✔One area of town has maximum building height requirements
and setbacks for the front, side, and rear yards. These requirements are all indicative of ______.
850 square feet - correct answer ✔✔Margie needs to know the square footage for the first floor
of the condo her client is interested in buying. The kitchen is 10 feet by 15 feet, the living/dining
combo is 20 feet by 25 feet, and the office and bedroom are each 10 feet by 10 feet. What's the
total square footage?
$1,110.64 - correct answer ✔✔A buyer with a 20-year, $419,000 loan at a 4.25% interest rate
has a monthly principal and interest payment totaling $2,594.59. If $1,483.95 is interest, how
much is applied toward principal for that payment
Document the issue on the AVID form and attach it to the TDS. - correct answer ✔✔During your
visual inspection of a property that you are listing for sale, you notice some termite damage on
two of the doorsills. How should you report this issue?
