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PRACTICE
Georgia Real Estate Final Exam
| Question | Answer |
|---|---|
| A salesperson advertises her own personal real estate for sale without giving the name of her broker. This is allowed if: | the advertisement discloses that the seller is a real estate licensee |
| A person who is authorized to act legally for another person is: | attorney in fact |
| After construction is complete, but before a tenant can move into a new facility: | a certificate of occupancy must be issued |
| Which of the following best describes a VA loan? | A lender makes it; the VA guarantees it |
| Experienced property managers know that an increase in the demand for the residential rental properties that they manage will almost always follow: | general increase in mortgage interest rates |
| A quitclaim deed conveys: | the grantor's interest in a given property, if any |
| A mortgagee forecloses on a property, and the proceeds from the foreclosure sale do not cover the costs of foreclosure. What can the mortgagee do? | Obtain a deficiency judgment |
| building's gross annual income is $550,000. Its operating expense ratio is 83%. The capitalization rate is 11.5%. What is the building's value using the capitalization approach? | $813,043Explanation: Subtract the operating expenses from the gross income to find the net income: $550,000 – 83% = $93,500. Then divide the net income by the capitalization rate to find the value: $93,500 ÷ 11.5% = $813,043. |
| How is an appraiser's fee determined? | Based on the time and difficulty involved in making the appraisal |
| After showing several properties to R, Broker H advises R that one of the properties is the best buy for R. Under general agency law, H's conduct could create which of the following types of agency relationships? | Implied Explanation: Under general agency law, an implied agency can be created when third parties |
| All of the following are requirements for obtaining a Georgia real estate salesperson's license, EXCEPT: | At least 21 years old |
| For income tax purposes, a rental home is considered | property held for the production of income |
| A condominium owner leased his unit to a tenant. The interest acquired by the tenant is called: | leasehold estate; Explanation: A lease creates a leasehold estate. The interest of the landlord (owner) is called a leased fee. |
| The personal assets of all of the following business investors could NOT be attached by creditors of the business, EXCEPT those of: | general partners |
| On a settlement statement, where would a prepayment penalty appear? | As a debit to the seller |
| All of the following would result in the termination of a listing agreement, EXCEPT: | An offer is accepted by the seller Explanation: The agency does not terminate until the transaction is closed. |
| On a settlement statement, the financing for a transaction, no matter what the source, is always a: | credit for the buyer The financing is always a credit for the buyer, whether it takes the form of a new institutional loan, an assumption, or seller financing. |
| If a lease does not specify when the rent is to be paid by the tenant, when is it due? | At the end of the rental period. If the lease doesn't specify when the rent is due, it is not due until the end of the rental period. |
| A legal description that starts at an identifiable point of beginning, describes the property's boundaries by distance and direction, and makes reference to monuments, is called a: | metes and bounds description This describes the metes and bounds method of land description. |
| Which of the following is an example of a natural attachment? | An apple orchard : An apple orchard is considered a natural attachment, even if it was planted by human beings. Natural attachments include all trees and other plants growing on the land. |
| A property owner who uses water from a river flowing across her land is exercising: | a riparian right. Riparian rights are the rights of a landowner whose property is adjacent to or crossed by a body of water. |
| Broker J took a listing on an older home with the provision that it is to be sold "as is." the seller explained that the wiring was defective & would not pay for any repairs to the property. What is Broker J's responsibility to prospective buyers? | she must disclose the wiring problem to prospective purchasers. Even though the home is being sold "as is," the disclosure must be made. The buyer can then decide whether the home's condition is acceptable. |
| A buyer agrees to purchase a home on the condition that the riding lawn mower be included in the sale. What document would be used to convey title to the lawnmower? | A bill of sale: A bill of sale transfers title to personal property; a deed transfers title to real property. |
| Which step in the disciplinary process by the Real Estate Commission occurs first? | Investigation: The first step in any disciplinary action is investigation by the Real Estate Commission. If an infraction is found, the Commission may then decide to issue a citation or hold a hearing, depending on the nature of the violation. |
| Which of the following statements concerning a salesperson transferring to another broker is NOT true? | The broker may refuse to release the licensee's license if she owes fees to the broker: A broker may never refuse to release an affiliated licensee's license |
| Which of the following statements is true of an encumbrance? | It is an interest in real property held by someone other than the owner : An encumbrance is a nonpossessory interest in real property that is held by someone other than the property owner. |
| A property owner and a tenant enter into a three-year lease. Shortly thereafter, the owner sells the property. What is the effect of the sale on the lease? | The new owner must honor the lease: The lease is unaffected, and the new owner must abide by its terms. |
| Which of the following is false about real estate investment trusts? They must: | A. be incorporated REITs are unincorporated trusts. They generally must have at least 100 investors, are subject to federal regulation (specifically by the SEC), and have centralized control vested in the trustees. |
| 30. A contract that creates a right to buy or lease property for a fixed price within a set period of time is: | option: An option is a contract that gives one party the right to do something--such as buy or lease real estate on specified terms--without obligating him to do it. |
| A promissory note that is secured by a mortgage is: | primary evidence of the debt: The note is evidence of the debt; the mortgage is security for the debt. |
| Which of the following statements is CORRECT about a deed restriction that prohibits building a home with less than 3,000 square feet on the lot? | It runs with the land and is binding on subsequent owners: Explanation: Deed restrictions run with the land, which means they are binding on all future owners of the land. |
| Many home purchase loans are: | budget mortgages: Many ordinary home purchase loans are budget mortgages. |
| Which of the following describes the difference between the reproduction cost method and the replacement cost method? | Reproduction cost refers to building a replica property; replacement cost refers to building one with equivalent utility |
| A contract for deed (land contract) conveys: | equitable title to the vendee: Equitable title is a substantial interest in the real estate that the vendee holds while paying off the land contract. |
| In an area where there are completely different zonings, the area that separates them is called: | a buffer: A buffer is a strip of land that separates one zone from another. An example would be a green belt. |
| Someone who deliberately misrepresents a material fact with the intent of causing another person to suffer a loss may be guilty of: | fraud: When one person deliberately provides another person with false information in order to persuade the other person to enter into a transaction, it's fraud. |
| A landlord may legally reject a prospective tenant's application for a residential lease because the: | tenant's family is too large for the rental unit: Explanation: It's legal to deny a lease application on the grounds that the applicant's family is too large for the rental unit. |
| How long does an aggrieved person have to file a complaint concerning an alleged act of discrimination with the Department of Housing and Urban Development? | 12 months: Explanation: A complaint must be filed with the Department of Housing and Urban Development within one year of the discriminatory conduct. |
| office building with measurements of 110' × 90' rents for $11 per square foot annually. S signs a 10-year lease, with the first year's rent waived by the landlord. If Smith makes monthly payments, what will the payments average over the ten-year period? | Multiply 110 ft 90 ft =9,900 sf Multiply 9,900 sf/ $11. 9,900 × $11 = $108,900 $108,900 x 9. $108,900 × 9 = $980,100. Divide the total rent paid by 120 (months), the actual term of the lease, and the average monthly rent comes to= $8,167.50. |
| Those who acquire property by intestate succession receive title by: | court order: Intestate succession results when someone dies without a valid will. The probate court orders the estate assets to be distributed to the heirs. |
| Acquiring property using a small downpayment, with the balance of the payment in the form of a loan, is an example of: | everage: Acquiring property using a small downpayment, with the balance of the payment in the form of a loan, is an example of: |
| Z failed to pay a contractor for labor and materials used in the repair of her home. This may result in: | construction lien: A construction lien is a lien on property in favor of someone who provided labor or materials to improve it, but who has not been paid. Construction liens are also called mechanic's liens. |
| A developer purchases a lot for $28,000 and builds a house for $250,000. He wants to make a profit of 5% on the lot and 30% on the house. For what price must he sell the property? | $354,400=first, ($28,000 × .05 = $1,400) 30% ($250,000 × .30 = $75,000) find the amount for which the property needs to be sold, add the costs of the lot and the house plus the requisite profits ($28,000 + $250,000 + $1,400 + $75,000 = $354,400) |
| dams purchases a home that is wired for 100 amps of electricity, a little underpowered by modern standards (the power company now offers 200 amp service). This is an example of: | functional obsolescence: Any problem found within a property's boundaries other than physical deterioration (wear and tear) is classified as functional obsolescence. |
| A receives an earnest money deposit over the weekend, when her brokerage office is closed. Her brokerage's policy is that earnest money deposits must be turned over to the brokerage's office manager during regular business hours. The salesperson must: | hold the earnest money deposit until Monday A salesperson must handle trust funds properly. This means turning the funds over to the broker as soon as is practically possible, and not commingling the funds with her own funds. |
| Which of the following describes a situation in which the seller would NOT be liable for a tort committed by the agent? | Agent's actions were within the scope of the agency: A principal's liability for the acts of his agent only extends to torts committed within the scope of the agency |
| 48. T signed a deed under duress. The deed is: | voidable by the grantor only: The deed can be voided by the victimized party (in this case, T). Only the grantor signs the deed. |
| The main purpose of a mortgage is to: | pledge the property as security for a loan: A mortgage pledges the property as security for a loan. |
| The note and security instrument contain a provision that allows the lender to demand immediate payment in full if the borrower defaults. This provision is called: | an acceleration clause: An acceleration clause allows the lender to accelerate the loan--demanding immediate payment in full--if the borrower defaults on any of the terms of the loan agreement. |
| On the 5th, a salesperson receives an offer with an earnest money deposit and a request that the check not be deposited until the 10th. The seller accepts the offer on the 6th. On what day should the check be turned over to the broker? | B Explanation: BRRETA requires an agent to disclose actually known adverse material facts to both clients and customers. The duties of accounting, recommending expert advice, and protecting confidential information are owed only to clients. |
Created by:
Mz Jade
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