True Or False Arizona Real Estate Test 2013

Front 1

The transaction is officially closed when the deed is signed?

Back 1

False

Front 2

The escrow agent is a 3rd neutral party

Back 2

True

Front 3

The Title Insurance policy is usually paid by the seller?

Back 3

True

Front 4

Closing must always take place at the Title Company?

Back 4

False

Front 5

VA Loans require the veteran to pay a funding fee?

Back 5

True

Front 6

A statutory year is 365 days and exact numer of days in each month?

Back 6

False
Statutory is 360 days / 30 days in each month

Front 7

A debit is enterest into someone's favor?

Back 7

False
A credit is enterest in someone's favor

Front 8

The Buyer Day Rule mean that the buyer pays all prorations for that day and collects rent for that day?

Back 8

True

Front 9

Prorate is similar to apportioning?

Back 9

True

Front 10

Marketable title means there are no serious defects?

Back 10

True

Front 11

The real estate commission appears on the settlement statement as a debit to the seller

Back 11

True

Front 12

Escrow Companies are regulated by the Arizona Department of Real Estate?

Back 12

False
Regulated by Arizona Dept. of Financial Institution

Front 13

Escrow Companies can service loans for a lender

Back 13

True

Front 14

When escrow companies service loans they are called servicers?

Back 14

True

Front 15

Appraisers are legally required for all transfers of real property?

Back 15

False

Front 16

Balance of down payment will be a debit to the buyer?

Back 16

True

Front 17

CERCLA refers to a law which mandates clean up after national disasters?

Back 17

False
Environmental Pollution

Front 18

Asbestos is no longer considered an environmental hazard since it can't be removed.

Back 18

False

Front 19

The source of meoney to clean up major environmentally polluted properties was orginally created by CERCLA

Back 19

True

Front 20

Clean up of Meth labs is called sanitation?

Back 20

False
Remediation

Front 21

Radon is an odorless, colorless, radioactive gas?

Back 21

True

Front 22

Radon gas is not found in Arizona becuase there are very few homes with basements?

Back 22

False
Found in all States

Front 23

Groundwater can be contaminated by a variety of causes including septic tanks?

Back 23

True

Front 24

A real estate salesperson must disclose superfund site?

Back 24

True

Front 25

Immunity for a landowner innocent of creating pollution on his property will most likely be dependent on his due dilligence in investigating the property?

Back 25

True

Front 26

SARA has a process in which they id potential responsible parties in environmental damage issues?

Back 26

True

Front 27

ADEQ was formed to enforce cleanup of hazordous waste

Back 27

False
CERCLA was

Front 28

A buyer has 10 days to cancel a contract once he receives notice of the existence of a meth lab?

Back 28

False
5 days

Front 29

Encapsulation is a term associated with asbestos?

Back 29

True

Front 30

An owner is required by law to disclose the existence of a meth lab on the premises in all circumstances?

Back 30

False

Front 31

There are five active management areas in Arizona?

Back 31

True

Front 32

An individual cannot be denied a purchase of a home due to their financial situation?

Back 32

False

Front 33

Lender must provide borrowers a Good Faith Estimate of settlement cost:

Back 33

True

Front 34

Truth In Lending - Regulation Z requires credit institutions to diclose to borrowers the true cost of obtaining credit?

Back 34

True

Front 35

Trigger Terms used in advertising require full disclosure?

Back 35

True
Reg Z requires full disclosure

Front 36

Penalties for noncompliance are $10,000 for each day a violation continues.

Back 36

True

Front 37

Home Mortgage Disclosure Act (HMDA) was created to eliminate discremenatory practices in lending?

Back 37

True

Front 38

Equal Credit Opportunity Act (ECOA) prohibits discremination when granting credit?

Back 38

True

Front 39

The Fair Credit Reporting Act regulates the action of credit bureaus and the use of consumer credit?

Back 39

True

Front 40

Civil Rights Acts applied to real and personal property?

Back 40

True

Front 41

The Federal Fair Housing Act of 1968 prohibits discrimination regarding housing?

Back 41

True

Front 42

FFHA inlcudes race, color, religion, and national orgin?

Back 42

True

Front 43

The Housing and Community Development Act of 1974 added sex to FFHA?

Back 43

True

Front 44

Fair Housing Ammendment Act of 1988 added disability and familial status?

Back 44

True

Front 45

FFHA prohibits blockbusting, steering and redlining?

Back 45

True

Front 46

Americans with Disability Act (ADA) prohibits discrimination regarding employment and accommodations and is enforced by the atty general?

Back 46

True

Front 47

Megan's Law established state regulation system to maintain residential information of sex offenders.

Back 47

True

Front 48

The 1866 Civil Rights Act prohibited discrimination based on color and race only

Back 48

True

Front 49

Equal Credit Opportunity Act (ECOA) prohibits discremination when granting credit?

Back 49

True

Front 50

Familial status refers to a married couple or two people who live together?

Back 50

False
under age 18

Front 51

The Fair Credit Reporting Act regulates the action of credit bureaus and the use of consumer credit?

Back 51

True

Front 52

Civil Rights Acts applied to real and personal property?

Back 52

True

Front 53

The Federal Fair Housing Act of 1968 prohibits discrimination regarding housing?

Back 53

True

Front 54

FFHA inlcudes race, color, religion, and national orgin?

Back 54

True

Front 55

Megan's Law established state regulation system to maintain residential information of sex offenders.

Back 55

True

Front 56

Age is covered in the Equal Credit Opportunity Act, but not in the Federal Fair Housing Act?

Back 56

True

Front 57

A four-plex owner, living in one of the units, is exempt from the FFHA assuming no discrimination advertising has been done?

Back 57

True

Front 58

AIDS is not considered a disability

Back 58

False

Front 59

"Reasonable Accommodation" is the key word regarding the disabled or disadvantaged?

Back 59

True

Front 60

Showing customers homes in areas where their particular race lives so they will be happier is a good practice for a salesperson

Back 60

False
You cannot steer

Front 61

Complaints regarding violations of the Federal Fair Housing law are handled by the ADRE.

Back 61

False
By HUD

Front 62

RESPA Relates to Settlement Statements

Back 62

True

Front 63

RESPA does not apply to owner financing?

Back 63

True

Front 64

A subdivider must have a real estate license

Back 64

False

Front 65

A subdivider must obtain an SDR before selling lots?

Back 65

True

Front 66

An SDR must be obtained in order to subdivide land into six or more parcels each under 30 acres?

Back 66

True

Front 67

Once a subdivider has approval from the Real Estate Commisioner. he can advertise "No Risk"

Back 67

False

Front 68

An Acre is 43,560 square feet

Back 68

True

Front 69

The recission period on unsubdivided land that has not been inspected is 7 days

Back 69

False
6 months

Front 70

Boot can be cash given out of a tax deferred exchange?

Back 70

True

Front 71

There is no recission period on an unimproved lot?

Back 71

False

Front 72

A buyer has 3 years to void a contract for purchase of subdivided land if the buyer did not receive an SDR prior to signing?

Back 72

True

Front 73

A subdivider must have a sales office in order to receive a Subdivision Disclosure Report

Back 73

False

Front 74

Subdividers must have approval from the Governor

Back 74

False

Front 75

An investor is using leverage when he purchases real estate with borrowed funds?

Back 75

True

Front 76

The definition of an improved lot, per AZ Statutes, is a lot that has utilities

Back 76

False

Front 77

Tax deferred exchanges require properties to be of like kind?

Back 77

True

Front 78

The major objective of a 1031 exchange is tax elimination

Back 78

False

Front 79

Subdivided land cosists of
6 or more parcels
each under 36 acres

Back 79

True

Front 80

Unsubdivided land consists of
6 or more parcels of 36 acres, but less than 160 acres?

Back 80

True

Front 81

A subdivider needs to obtain a Subdivision Disclosure Report from the Commissioner prior to selling lots?

Back 81

True

Front 82

A Subdivision Disclosure Report is not required for bulk land?

Back 82

True

Front 83

The purpose of the Subdivision Disclosure Report is to protect the buyer?

Back 83

True

Front 84

Prior to receiving the Subdivision Disclosure Report. lot reservations can be taken

Back 84

True

Front 85

When making a reservation, the maximum deposit is $5000 and is totally refundable?

Back 85

True

Front 86

A buyer must be given a copy of the SDR prior to signing a contract. If the buyer does not rcve the report, the contract is voidable for 3 years.

Back 86

True

Front 87

Marketing material cannot say "no risk" or "endorsed by Commissioner"?

Back 87

True

Front 88

Capital gains are taxed at a rate of 15%.

Back 88

True

Front 89

There are no capital gains assessed on an individual's primary residence?

Back 89

True

Front 90

An appraisal is an estimate or opinion of value?

Back 90

True

Front 91

A salesperson prepares a CMA in the same manner as an appraiser prepares an appraisal.

Back 91

True

Front 92

Economic onsolescence is almost always incurable?

Back 92

True

Front 93

Value can be affected by physical characteristics

Back 93

True

Front 94

Location is the most important criteria in the CMA

Back 94

True

Front 95

The gross rent multiplier is not an approach to value

Back 95

True

Front 96

Depreciation is not considered in the Income Approach to value?

Back 96

True

Front 97

Essential elements of value are demand, utility, scarcity and taxability with the acronym DUST

Back 97

False
They are Characteristics of Value

Front 98

The funtion of an appraiser is to establish the price

Back 98

False

Front 99

A federal regulation in appraisal is FIRREA

Back 99

True

Front 100

A swimming pool, marble floors and a jacuzzi will return every cent spent in the market value of a home

Back 100

False

Front 101

Utilities would not be an operating expense of an aprtment building

Back 101

False

Front 102

Appraisers must have a Federal Appraisal License

Back 102

False

Front 103

The three main types of depreciation are
Phsycical obsolescence
Functional obsolescence
Economic obsolescence

Back 103

True

Front 104

A buyer and seller determine fair market value

Back 104

True

Front 105

The Market Data Approach is the only method which can be used to value land.

Back 105

True

Front 106

Most property is purchased with the expectation of appreciation?

Back 106

True.
An increase in value.

Front 107

Cost is the historical expenditure for the purchase, contruction, and improvement of the property.

Back 107

True

Front 108

Cost has nothing to do with present value

Back 108

True

Front 109

Market Value is the highest price a property will bring in an open market?

Back 109

True

Front 110

The Market Data Approach is considered the most reliable approach when appraising a single family home.

Back 110

True

Front 111

Market Approach is used to appraise land

Back 111

True

Front 112

FHA Insurance is called MIP

Back 112

True

Front 113

Mortgage loan intrest rates are tied to bond rates?

Back 113

True

Front 114

Subprime loans are inllegal

Back 114

False

Front 115

The documents required for a VA loan are a Cert of Eligibility and a Cert of Reasonable Value

Back 115

True

Front 116

`FICO scores are only a small part of a loan approval

Back 116

False

Front 117

Straight loans are fully paid off when the final payment is made

Back 117

False
Principal due at end

Front 118

A partially amortized loan has a balloon payment?

Back 118

True

Front 119

An ARM loan has a fixed interest rate

Back 119

False

Front 120

Caps in an ARM loan protect a borrower?

Back 120

True

Front 121

Graduated payment loans have negative amortizations?

Back 121

True

Front 122

The secondary mortgage market does not lend money?

Back 122

True

Front 123

A borrower must be a minimum of 65 years old to get a Reverse Annuity Mortg

Back 123

False

Front 124

Construction loans are often paid off by a take out loan?

Back 124

True

Front 125

Mortgage brokers and mortgage bankers do not deed a license

Back 125

False

Front 126

A fully amortized loan is totally paid off when the final payment is made?

Back 126

True

Front 127

A mortgage banker borrows money to make loans. Mortgage bankers sell all their loans to investors or to the secondary market. Mortgage bankers are the major source of residential loans.

Back 127

True

Front 128

A mortgage broker processes loan but usually has no funds.

Back 128

True

Front 129

A mortgage broker places the loan of a qualified borrower with an investor, who funds the loan through escrow.

Back 129

True

Front 130

The Mortgage Broker receives an origination fee from the borrower?

Back 130

True

Front 131

FHA Does Not lend money.

Back 131

True
It insures the lender

Front 132

MIP is isnsurance required with an FHA Loan?

Back 132

True

Front 133

VA guarantees a portion of the loan to the lender?

Back 133

True

Front 134

Veterans getting a VA loan must pay a 1% funding fee?

Back 134

True

Front 135

Any loan that is not FHA insured or VA guaranteed is a conventional loan.

Back 135

True

Front 136

PMI is insurance required with a conventional loan of the down payment is less then 20% of the purchase price.

Back 136

True

Front 137

The higher the LTV, the less equity is at stake?

Back 137

True

Front 138

Recording a deed gives legal notice

Back 138

True

Front 139

It is a Recording requirement that a deed must be acknowledged.

Back 139

True

Front 140

The act of transferring ownership is granting?

Back 140

True

Front 141

Love and Affection is adequate consideration

Back 141

True

Front 142

The Bargain and Sale Deed offers the most promises

Back 142

False
Limited promise

Front 143

The Covenant of Seizen assures that the grantor has the authority to convey?

Back 143

True

Front 144

The Law of Evidence requires that the transfer of real property be in writing

Back 144

False
Statute of Frauds

Front 145

A Sheriff's Deed is given when the property is sold for back property taxes

Back 145

False
Mortg fcl

Front 146

Quiet Enjoyment protects a property owner from eviction

Back 146

False

Front 147

Lis Pendens means lawsuite pending?

Back 147

True

Front 148

A deed transfers ownership of real property?

Back 148

True

Front 149

Consideration is the courtesy the seller gives the buyer during a real estate transaction

Back 149

False

Front 150

To be valid a deed requires recording

Back 150

False

Front 151

Adverse possession is a form of involuntary alienation?

Back 151

True

Front 152

The creditors of the grantor have the greatest interest seeing that a deed is recorded

Back 152

False

Front 153

A deed is the instrument or document that conveys title?

Back 153

True

Front 154

The Grantor's signature is required on the Deed?

Back 154

True

Front 155

The Quitclaim Deed transfers rights to the property, but has no warranty?

Back 155

True

Front 156

The Quitclaim Deed imposes the least liability on the seller.

Back 156

True

Front 157

The General Warranty Deed gives the greatest protection for the buyer?

Back 157

True

Front 158

Valid consideration is required for a deed. It can be valuable or good.

Back 158

True

Front 159

Good consideration for a gift deed is Love and Affection.

Back 159

True

Front 160

The Habendum Clause explains the quantity and quality of ownership?

Back 160

True

Front 161

A deed must have a legal description

Back 161

True

Front 162

Title passes upon delivery and acceptance of Deed.

Back 162

True

Front 163

Acknowledgement of a deed is a recording requirement?

Back 163

True

Front 164

A Disclaimer Deed is when the spouse declares they have no interest in the property and will never claim any.

Back 164

True

Front 165

A Deed must be recorded in the County where the property is located?

Back 165

True

Front 166

A Deed requires a definate grantee?

Back 166

True

Front 167

The required occupancy time for an adverse possessor is 10 years

Back 167

True

Front 168

The "Time is of the Essence" clause in a contract means it should be completed as soon as possible.

Back 168

True

Front 169

The person who signs to show acceptance of a sales contract is the offeree?

Back 169

True

Front 170

An option is assignable unless prohibited?

Back 170

True

Front 171

Offers to purchase must be presented to the seller in a reasonable amount of time.

Back 171

True

Front 172

When the seller makes a change in the amount of the earnest money deposit to be made, initials the change and signs the contract, it is considered a counteroffer?

Back 172

True

Front 173

An executed contract is a contract that has been terminated?

Back 173

True

Front 174

In an option agreement, the party with the most control is the optionee?

Back 174

True

Front 175

Parol Evidence is the rule that oral evidence will not be admissible to vary the terms of the written contract.

Back 175

True

Front 176

A contract is a legally enforceable agreement between competent parties who agree to perform or refrain from performing certain acts for consideration?

Back 176

True

Front 177

A contract must be written and signed by all parties?

Back 177

True

Front 178

A person who has limited capacity (insane, minor, under infuence of drugs/alcohol or under duress) may void a contract?

Back 178

True

Front 179

An offeror may rescind the offer at any time verbally until the agent has notified offeror of acceptance?

Back 179

True

Front 180

Earnest money IS NOT the consideration?

Back 180

True

Front 181

Article XXVI of the Arizona Constitution gives broker or salesperson authority to write contracts relared to real estate transations, but charging a fee is prohibited.

Back 181

True

Front 182

Brokers must keep executed sales contracts for 5 years; rejected offers must be kept for 1 year.

Back 182

True

Front 183

Brokers must approve contracts within 10 business days?

Back 183

True

Front 184

Breach of contract occurs when either party defaults.

Back 184

True

Front 185

Recission is a legal remedy of cancelling a contract and returns parties to their original positions.

Back 185

True

Front 186

Any change in the offer creates a counteroffer. A counteroffer is a new offer and it voids the original offer.

Back 186

True

Front 187

Performance completes the contract terms?

Back 187

True

Front 188

A suit for specific performance is judicial action to force a party to carry out the terms of the contract.

Back 188

True

Front 189

Substitution of parties is assignment?

Back 189

True

Front 190

Damages for breach of contract in excess of the actual loss suffered would be compensatory damages

Back 190

False

Front 191

If the offeror dies prior to the offere's acceptance of the offer the contract is enforceable

Back 191

False

Front 192

A purchase contract must be in writing and is considered an implied contract

Back 192

False

Front 193

A real estate broker's commission is earned when escrow closes

Back 193

False

Front 194

Commission charged by real estate brokers for their services are set by the Real Estate Commissioner

Back 194

False

Front 195

When an owner reserves the right to sell his property himself without paying a commission it is an exclusive right to sell listing

Back 195

False
Exclusive Agency Listing

Front 196

If a salesperson receives a very poor offer on a listing, he does not need to bother the seller with it

Back 196

False

Front 197

A broker must approve the listing agreement within five business days

Back 197

False
10 business days

Front 198

When a salesperson leaves one brokerage and moves to another one, he takes any listings he has with him

Back 198

False

Front 199

When a retainer is paid, this fee is paid to the salesperson

Back 199

False

Front 200

All listings belong to the broker and stay with the broker.

Back 200

True

Front 201

A Real Estate sales person can show property listed by another real estate office?

Back 201

True

Front 202

If a Real Estate salesperson sells his own property, he must disclose that he is an agent.

Back 202

True

Front 203

A NET Listing is when the broker's commission is the differance between the sales price and the amount the seller must receive from the sale of the home.

Back 203

True

Front 204

A listing agreement must have a termination date?

Back 204

True

Front 205

An EXCLUSIVE Agency listing allows the seller to sell the property WITHOUT obligation to the broker?

Back 205

True

Front 206

The MLS is a tool to market properties?

Back 206

True

Front 207

The listing agreement gives the agent permission to place a sign in the yard?

Back 207

True

Front 208

An EXCLUSIVE Right to Sell listing guarantees a broker a commission?

Back 208

True

Front 209

In Arizona there are no required listing forms?

Back 209

True

Front 210

If a listing salesperson dies the listing are still in effect?

Back 210

True

Front 211

An agent must present all offers unless authorized by the seller to the contrary?

Back 211

True

Front 212

Paul has permission to hike on Nacy's property during the summer. Paul has an easement by necessity

Back 212

False

Front 213

Once an easement is given, it can never be terminated

Back 213

False

Front 214

A township is 36 miles square and contains 36 square miles

Back 214

False

Front 215

Correction lines cause sections on the south and the west of a twonship to be fractional

Back 215

False

Front 216

A parcel containing 640 acres is a twonship

Back 216

False
It is a section

Front 217

A parcel of land that is 24 miles square is a section

Back 217

False

Front 218

Range lines run parallel to township lines

Back 218

False

Front 219

A mechanics lien can only be filed by the general contractor

Back 219

False

Front 220

In rural areas outlining the property from point of beginning is called Metes and Bounds description?

Back 220

True

Front 221

Sections are divided into quarters and halves to pinpoint a properties location?

Back 221

True
640 acres in section

Front 222

A parcel containing 640 acres is a Section?

Back 222

True

Front 223

A RECORDED subdivision PLAT is used in the Lot, Block and Tract System?

Back 223

True

Front 224

Monetary encumbrances that affect the title to a property are called liens?

Back 224

True

Front 225

To keep someone from obtaing an easement by perscription, a license could be granted?

Back 225

True

Front 226

A new subdivision would use the lot, block and tract method?

Back 226

True

Front 227

A mechanics lien must be filed within 120 days of completion.

Back 227

True

Front 228

Half Section is 320 acres

Back 228

True
640/2

Front 229

Quarter of a section 160 acres

Back 229

True
640/4

Front 230

There are no limits on property owned in fee simple

Back 230

False

Front 231

A leasehold estate has an indefinate duration

Back 231

Fale

Front 232

The maximum degree of ownership allowed by law is a life estate

Back 232

False
A fee simple estate is highest

Front 233

A condominium cannot be owned in a fee simple estate

Back 233

False

Front 234

A life estate always conveys ownership for the life of the life tenant

Back 234

False

Front 235

A fee simple estate is transferable and inheritable.

Back 235

True

Front 236

There are limits on property owned in fee simple?

Back 236

True

Front 237

A life tenant dies and the interest goes to the remainderman. The property is now fee simple?

Back 237

True

Front 238

The remainderman is an individual or entity who receives the property in fee simple after a life estate?

Back 238

True

Front 239

A pur Autre vie life estate is not inheritable?

Back 239

True

Front 240

In many states, a family may have a legal life estate called homestead?

Back 240

True

Front 241

A leasehold estate has a definite duration?

Back 241

True

Front 242

A grantor of a life estate has a fee simple estate?

Back 242

True

Front 243

The owner of a property with a condition subsequent has a defeasible estate?

Back 243

True

Front 244

Arizona is not under the feudal system of ownership.

Back 244

True

Front 245

In a deed of Trust the lender is called the trustee

Back 245

False

Front 246

FNMA is a private corporation under HUD regulatory control that establishes federal usury rates

Back 246

False

Front 247

A discount point lowers the monthly mortgage payment for only the first year

Back 247

False

Front 248

Strict foreclosure means that the borrower's obligations are strictly enforced

Back 248

False

Front 249

A non-disurbance caluse means that the house will not be shown without first calling the seller

Back 249

False

Front 250

Collateral is pledging property as security for debt without giving up possession

Back 250

False

Front 251

Interest paid on June 1 is for the use of money from June through June

Back 251

False

Front 252

A property manager must keep records or leases for 3 years

Back 252

False

Front 253

Property management agreements are convered in the Lanlord Tenant Act

Back 253

False

Front 254

The legal description is required in a lease

Back 254

False

Front 255

The tenant's remedy if the landlord does not maintain the property is actual eviction

Back 255

False

Front 256

The tenant must be given the lanlord's rules within 24 hours signing the lease

Back 256

False

Front 257

Records about finder's fees paid must be kept for 1 year

Back 257

False

Front 258

The Broker is commiting an illegal act by representing both the buyer and the seller

Back 258

False

Front 259

An agency relationship created by actions of the parties is a general agency

Back 259

False

Front 260

The principal is the broker's customer

Back 260

False

Front 261

The type of Agency created is determined by the percent of the commission agreed upon

Back 261

False

Front 262

An Agenct has limited authority as the attorney-in-fact in a unirversal agency

Back 262

False

Front 263

A buyers broker has a fiduciary responsibility to both the buyer and the seller

Back 263

False

Front 264

One of the Real Estate Commisioners responsibilities is to initiate laws governing the real estate industry

Back 264

False

Front 265

Advisory Board is made up of 9 members elected every 4 years

Back 265

False

Front 266

Rejected offers must be kept for 5 years from date of rejection

Back 266

False

Front 267

The Real Estate Commisioner can only investigate a licensee if a complaint is received

Back 267

False

Front 268

The Real Estate Commisioner must hold an active Real Estate license

Back 268

False

Front 269

A real estate broker must maintain records of transactions for five years from the inception of the transaction

Back 269

False

Front 270

A broker who is temporarily absent from the office must appoint a licensed broker as the designated representative

Back 270

False

Front 271

The Real Estate Advisory Board members are appointed by the Real Estate Commisioner

Back 271

False

Front 272

An attorney in fact selling property for a principal would be required to have a real estate license

Back 272

False

Front 273

Spending monies in a trust account is known as commingling

Back 273

False