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60 Cards in this Set
- Front
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Which of the following is the ONLY section which must be a office policy manual? Human Resource Benefits Commission Plan Backup Contracts Brokerage Relationships Offered to Public |
A: Brokerage Relationships Offered to Public There are only three sections which are mandatory, whereas there are a number that are suggested. The mandatory ones are: written brokerage relationship policy, a policy to protect confidential information and designation brokerage relationships. The suggested ones are the long list below. |
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The Colorado Real Estate Commission on its own motion can investigate: a licensee's real estate activities failure to account for money belonging to others violations of the Colorado Fair Housing Law all of the above |
A: all of the above The CREC has the power to investigate the real estate activities of any licensee upon its own motion. If a written complaint is filed the office on any topic the commission is compelled to investigate. |
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As per the Contract to Buy/Sell Real Estate:LEGAL FEES, COST AND EXPENSES. Anything to the contrary herein notwithstanding, in the event of any arbitration or litigation relating to this Contract, prior to or after Closing Date (§ x), the arbitrator or court must award to ______________________________, including attorney fees, legal fees and expenses. each party an equal share of reasonable costs and expenses the prevailing party damages the losing party all reasonable costs and expense the prevailing party all reasonable costs and expense |
A: the prevailing party all reasonable costs and expense Do not confuse litigation and arbitration with mediation. Mediation is a non-binding process and all parties share in the costs equally. Litigation and arbitration is binding and the prevailing party will be awarded costs and expense from the losing party. |
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When a licensee misrepresents facts in property sales, they are subject to which action? Paying a fine to the county in which the misrepresentation occurred Immediately having their license suspended by the Real Estate Commission Having a hearing before the Real Estate Commission Immediately having their license revoked by the Real Estate Commission |
A: Having a hearing before the Real Estate Commission A licensee is always under the jurisdiction of the real estate commission. Acts of fraud may also require a broker to appear in civil or criminal court. |
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In Colorado commissions for real estate transactions are set by: The Colorado Real Estate Commission Law Local boards of realtors Each brokerage firm |
A: Each brokerage firm Each brokerage firm sets its own commission structure parameters or else it could be construed as price fixing and a violation of Sherman Antitrust Laws. |
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A broker acting as a transaction broker for a buyer, with no written agreement needs: nothing. This is the default representation in Colorado to provide the buyer with a copy of the “Brokerage Disclosure to Buyer” with the broker’s signature showing the date it was given to the Buyer. a signed Exclusive agreement in order to show the buyer property. a signed disclosure form from the Buyer. |
A: to provide the buyer with a copy of the “Brokerage Disclosure to Buyer” with the broker’s signature showing the date it was given to the Buyer. Even though the broker has no written agreement - the broker is still required to make a written disclosure as to their relationship. Absent a written agreement - the default relationship is transaction broker. |
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You answered this question correctly When zoning authorities restrict particular land to accommodate an average maximum number of houses per acre, this is known as: cluster zoning density zoning maximum zoning gross zoning |
A: density zoning Density zoning ordinances restrict the average number of houses per acre that may be built within a particular subdivision. |
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Under an Exclusive- Right-To-Sell-Contract with a Brokerage Addendum, the seller: reserves the right to sell the property themselves and pay no commission reserves the right to pay no commission reserves the right not to sell the property must pay a commission if the property sells |
A: reserves the right to sell the property themselves and pay no commission
Under an Exclusive-Right-To-Sell-Contract with a Brokerage Addendum, if the seller sells the property himself, the listing broker earns no commission. |
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Which statement is false? A broker may deliver to an owner the security deposits, so long as it is disclosed Property managers may use security deposits for an emergency Delivery of earnest money to anyone without proper notice constitutes a violation of the license law escrow statute Delivery of earnest money to anyone without proper notice may be subject the broker to civil liability |
A: Property managers may use security deposits for an emergency Security deposits are the tenants money held for surety against possible damage. They are not the owners money to use in an emergency. |
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The owner of a treasurer’s deed: is not responsible for previous owner's property taxes if owed was the highest bidder at a tax lien sale owns the property free and clear after a redemption period all of the above |
A: all of the above A treasurer’s deed is a deed issued by the County Treasurer of a given county that states that a buyer of a tax lien has been granted ownership of a parcel they held a tax lien on. The three year redemption period following the sale must have expired for the owner and all other requirements under the law must have been fulfilled. At the end of this process, should no tax lien redemption take place, the County Treasurer will issue a treasurer’s deed on the parcel to the tax lien holder – making them the owner of the parcel. |
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A breach of contract is a refusal or failure to comply with the terms of the agreement. In Colorado if the seller breaches the contract, the buyer may: sue the seller for specific performance rescind and split the earnest money with the broker sue the seller for liquidated damages all of the above |
A: sue the seller for specific performance The buyer may always sue the seller for specific performance or damages, regardless of the type of contract used. The buyer is entitled to have his earnest money returned. |
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In which of the following instances would you use the Agreement to Amend/Extend Contract? To make changes in the purchase price of an offer prior to acceptance To change the loan application deadline in an accepted purchase contract To change the time allowed to accept an offer to purchase All of the above |
A: To change the loan application deadline in an accepted purchase contract The Agreement to Amend/Extend Contract is used to changes the conditions in an accepted contract to purchase. It cannot be used to change the conditions of an offer as an offer has not been accepted. If you want to change the terms or conditions of an offer prior to acceptance, you need to rewrite the contract or use a counterproposal. |
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It is proper for a licensee to use a Commission-approved Exclusive Right-to-Buy contract when the licensee is: acting as the seller’s agent in the sale of property listed with another brokerage company acting as the buyer's agent and the seller’s agent acting as the buyer's agent in locating real property acting as the buyer’s agent and as a transaction broker for the seller |
A: acting as the buyer's agent in locating real property A standard Exclusive- Right -To- Buy contract should be used whenever the broker is representing the buyer. |
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If an agent forgets to renew her license and submits the application to renew 30 days late. The status of her license during this 30 day period is: active suspended expired inactive |
A: inactive On the date a license expires, for the following 30 days it is placed into an "inactive" status and may be renewed by paying the regular renewal fee. After 30 days it is placed into an "expired" status. Renewing an expired license requires the payment of additional fees and satisfying additional educational requirements. |
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An Open Listing, an Exclusive Brokerage listing and an Exclusive Right-To-Sell listing all require: A lockbox to be used A definite termination date The property to be entered into an MLS The broker to offer compensation |
A: A definite termination date Money, lockboxes and use of MLS are optional. The use of a definite termination date for the agreement is not. Real Estate Commission rule E-11 does not allow open-ended contracts with Brokerage firms Reference Commission Rule E-11 |
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Martin is the agent for an estate that owns a unit in a condominium complex. The former owner died of AIDS in the unit, and five years before that the unit was the site of a brutal and highly publicized murder. What are Martin's disclosure responsibilities to prospective purchasers of this condo unit? He does not need to disclose the murder but must disclose the AIDS-related death. He is specifically from disclosure of these facts and relieved of liability for nondisclosure. He must disclose both the murder and the AIDS-related death. |
A: He is specifically from disclosure of these facts and relieved of liability for nondisclosure. The Colorado Real Estate Commission's position on psychologically stigmatized properties is events that would cause this are NOT TO BE disclosed and agents are protected from legal actions resulting from nondisclosure. Stigmatized property is a controversial term used in the real estate business for a property which buyers or tenants may shun for reasons that are unrelated to its physical condition or features. These can include events invloving murder or suicide or AIDS in addition to a belief that a house may be haunted. Material facts such as the foundation is bad or the house tested high for Radon ARE required to be disclosed. |
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Deposit money received by a licensee is turned over to the: seller of the property Real Estate Commission broker to deposit in his trust fund seller’s attorney |
A: broker to deposit in his trust fund All earnest money must be deposited in the employing brokers trust account within one business day, unless the buyer and seller instructed the broker, in writing, to do something different. |
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Broker Betty at an open house meets a young couple looking to purchase their first home. The couple asked if the Broker thought they had enough income to qualify for a loan to purchase the property. Realizing this information is of a confidential nature Broker Betty makes the agency disclosure that her office policy and State statute require. The buyers are very skeptical about making a commitment and have been coached by family members not to sign anything. They refuse to sign the signature block on the Brokerage Disclosure to Buyer form. Betty should: refuse to answer unless they sign answer the question, then ask them to sign once again call their attorney and make the disclosure to him make a note of the date and time the disclosure was made and reference the fact that the buyers declined to sign the form - then have the discussion. |
A: make a note of the date and time the disclosure was made and reference the fact that the buyers declined to sign the form - then have the discussion. Brokers are required to make agency disclosure. Buyers are not required to sign the disclosure. It is acceptable to note the date and time the disclosure was made, and indicate that the buyers declined to sign the form. |
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In order for the seller to sell his property, he must replace the carpet in the living room. What would it cost to put new carpet in the room measuring 15 feet by 20 feet if the carpet costs $26.95 per square yard, plus $450 installation charge? 2322 1348 3109 2335 |
A: 1348 There are 9 square feet in a square yard, it's because 1 yard is 3 feet and in a square all sides are equal in length, which makes 1 sq. yard equals to 3 * 3 = 9 square feet. So,the calculation for this questions is 15 sq ft x 20 sq ft = 300 sq.ft. 300sq ft / 9 ( here it is - a square yard is 3 yards by 3 yards or 9 square feet) = 33.33 sq yds x $26.95 = $898.33 + $450 = $1348.33 |
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In the Colorado Contract to Buy & Sell , if the buyer receives a property inspection report on the day after the Inspection Objection Deadline , and the report contains several serious matters. The buyer: Can compel the seller to correct these serious defects Is in default for missing the deadline and the seller may terminate the contract May still object since they did not receive the report until after the deadline Missed the opportunity to object based on inspections issues, and the contract is still in force. |
A: Missed the opportunity to object based on inspections issues, and the contract is still in force. If the buyer does not file an objection prior to the deadline the inspection contingency is waived |
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An Exclusive Right to Buy and Sell contract may disclose which of the following in the Acknowledgments section? The broker is an agent of the buyer The broker is a transaction broker The broker is an agent of both the buyer and the seller The broker is either a Buyers' Agent or a Transaction Broker or a Seller's Agent |
A: The broker is either a Buyers' Agent or a Transaction Broker or a Seller's Agent The Acknowledgements section of the Exclusive Right to Buy/Sell (AKA Purchase Contract) is the place where the brokers disclose their relationship to their clients.Here is a wiggle for you: the person writing an Exclusive Right to Buy and Sell agreement (Purchase Contract) for the buyer may be working either as a Transaction Broker for the buyer or seller, or as a buyers agent, or as a Sellers agent. How can the agent working with the buyer be a seller's agent? Ans. When the seller's agent is selling a property to a customer ie. an unrepresented buyer. As an example: the sellers agent sells the property to someone who does not have an agent, but who saw the property in an open house the agent was holding. In this case the agent discloses that he/she represents the seller and that the buyer is a customer.From the Acknowledgements section of the Contract to Buy and Sell Real Estate BROKER’S ACKNOWLEDGMENTS AND COMPENSATION DISCLOSURE.(To be completed by Broker working with Buyer)........Broker is working with Buyer as a Buyer’s Agent Seller’s Agent Transaction-Broker in this transaction. |
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The Colorado Contract to Buy & Sell establishes a loan commitment date if the buyer is getting a new loan. What is the effect of the deadline? The buyer must provide written commitment to the seller by that date The contract is contingent on actual funding of the new loan at closing If the buyer cannot get a satisfactory loan by that date, the contract terminates on that date If the buyer cannot get a satisfactory loan by that date, the buyer may terminate the contract with written notice to the seller |
A: If the buyer cannot get a satisfactory loan by that date, the buyer may terminate the contract with written notice to the seller The buyer may terminate or may decide to continue with the contract, but if the buyer decides to terminate he must provide written notice to the seller. |
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In the Colorado Listing agreement the holdover period provision entitles the broker to a commission if the property sells to anyone: The broker negotiated with during the listing period unless the seller lists with another exclusive broker and the "Shall" box has not been checked Within a stated period after listing expires The broker negotiated with during the listing period Within the listing period |
A: The broker negotiated with during the listing period unless the seller lists with another exclusive broker and the "Shall" box has not been checked The Holdover Period says that a listing broker may be entitled to a commission after the expiration of a listing contract for the period of time specified in the clause if: 1) the broker negotiated with the buyer during the listing period and 2) the broker submitted the name of this buyer in writing to the seller. Although the protection is for a negotiated time after the listing expires; it can terminate early if the property is re-listed by another agent and the "Shall Not" box is checked, meaning the old listing agent "shall not" be owed a commission if another brokerage firm has earned one. If neither the "Shall" or "Shall Not" be owned a commission" box is checked - the default is "Shall Not". See "Holdover Period" in the "When Earned" clause of an Exclusive Right to Sell listing agreement. |
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According to the rules and regulations of the Colorado Real Estate Commission, a broker is required to recommend that: the buyer have title reviewed by legal counsel the buyer have an appraisal by a licensed appraiser the buyer have an inspection by a certified house inspector all of the above |
A: the buyer have title reviewed by legal counsel All are great ideas and good ideas, but of those listed, only the recommendation of title examination by legal counsel is required by Real Estate Commission rules. This occurs at the end of the Title Advisory section of the Contract to Buy and Sell Real Estate wherein the contract advises the use of Legal Counsel to review title. The others appear in the purchase contract, but do not get an actual recommendation. See Below: "Title Advisory. The Title Documents affect the title, ownership and use of the Property and should be reviewed carefully. Additionally, other matters not reflected in the Title Documents may affect the title, ownership and use of the Property, including, without limitation, boundary lines and encroachments, area, zoning, unrecorded easements and claims of easements, leases and other unrecorded agreements, and various laws and governmental regulations concerning land use, development andenvironmental matters. The surface estate may be owned separately from the underlying mineral estate, and transfer of the surface estate does not necessarily include transfer of the mineral rights or water rights. Third parties may hold interests in oil, gas, other minerals, geothermal energy or water on or under the Property, which interests may give them rights toenter and use the Property. Such matters may be excluded from or not covered by the title insurance policy. Buyer is advised to timely consult legal counsel with respect to all such matters as there are strict time limits provided in this Contract" |
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The term "subdivision" does not include: A group of 20 or more time shares intended for residential use the conversion of an existing structure into a common interest community of at least 20 or more residences the selling of campground memberships a group of 20 proprietary leases in a cooperative housing corporation |
A: the selling of campground memberships The key term is "20 or more" to be considered a subdivision; excluding the selling of campground memberships. |
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If an offer is given that fulfills all the terms of a contact and the seller rejects that offer - what happens? The listing broker is entitled to a commission The listing broker receives no commission The listing broker can sue for specific performance The listing broker is entitled to a partial commission for services rendered |
A: The listing broker is entitled to a commission When we, as agents, enter an agreement to market someone's property, we are tasked to bring them a "ready, willing and able buyer". We do that - we get paid. If we do that and the seller gets cold feet, rejecting an offer which met all of the seller's stated requirements, nobody can force the seller to sell, but we did our job and the seller may be liable for a commission to the listing agent. |
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Who gets a copy of the contract? Buyer Seller Broker All of the above |
A: All of the above “He who signs gets a copy”. |
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All of the following are true in the Colorado Right to Buy Contract except: That the broker may be compensated by the seller Allows for the broker to be an agent for the sellers as well as the buyers May provide that the broker be paid an hourly rate Must have definite termination date |
A: Allows for the broker to be an agent for the sellers as well as the buyers The broker cannot represent both parties in the same transaction as an agent. He may assist or help them as a transaction broker |
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As per the Mediation clause in the Contact to Buy/Sale Real Estate: "The mediation, unless otherwise agreed, will terminate in the event the entire dispute is not resolved within _________ days of the date written notice requesting mediation is delivered by one party to the other at the party’s last known address. 30 45 60 90 |
A: 30 |
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Which would need to be registered with the CREC (Colorado Real Estate Commission) for a subdivision? A membership-based campground with 75 campsites Bulk sale of 500 lots between two developers A development with15 residential units A 60 unit co-op building |
A: A 60 unit co-op building The Subdivision Developer’s Act affects the types of subdivisions that must be registered with the Commission. The following types of subdivisions within the State of Colorado, and subdivisions located outside the state if being offered for sale in Colorado, must be registered before offering, negotiating, or agreeing to sell, lease, or transfer any portion of the subdivision:* 1. Any division of real property into 20 or more interests for residential use;* 2. Subdivisions consisting of 20 or more time-share interests (a time share interest includes a fee simple interest, a leasehold, a contract to use, a membership agreement, or an interest in common);* 3. Subdivisions consisting of 20 or more residential units created by converting an existing structure (e.g., condominium conversions); and* 4. Subdivisions created by cooperative housing corporations with 20 or more shareholders with proprietary leases, whether the project is completed or not. * B. Exempt from Registration under the Subdivision Developer’s Act:* 1. The selling of memberships in campgrounds;* 2. Bulk sales and transfers between developers;* 3. Property upon which there has been or upon which there will be erected residential buildings that have not been previously occupied and where the consideration paid by the purchaser for such property includes the cost of such buildings (this does not apply to conversions, time share, or cooperative housing projects);* 4. Lots that, at the time of closing of a sale or occupancy under a lease, are situated on a street or road and the street or road system is improved to standards at least equal to streets and roads maintained by the county, city, or town in which the lots are located; have a feasible plan to provide potable water and sewage disposal; and have telephone and electricity facilities and systems adequate to serve the lots, which facilities and systems are installed and in place on the lots or in a street, road, or easement adjacent to the lots and which facilities and systems comply with applicable state, county, municipal, or other local laws, rules, and regulations; or any subdivision that has been or is required to be approved after September 1, 1972 by a regional, county, or municipal planning authority pursuant to Article 28 of Title 30 or Article 23 of Title 31, C.R.S.; and* 5. Sales by public officials in the official conduct of their duties. |
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Acceptance of an offer must be which of the following? Signed by all parties acceptance must be communicated Within time limits All of the above |
A: All of the above To have a valid contract, it must be signed and accepted and that acceptance must be communicated to the person making the offer before the contract deadline. |
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The Licensee Buy-Out Addendum to a Contract To Buy and Sell Real Estate becomes binding with the listing company when: the listing company supervisory broker signs the seller/licensee signs the seller signs the buyer and the broker sign |
A: the listing company supervisory broker signs It is PERSONALLY binding on the seller and the agent (buyer) when they sign the contract. Although there is a place at the bottom for the supervising broker's signature, that signature is not mandatory. If the supervising broker does not sign, this agreement is NOT BINDING on the listing company. In the addendum it says "NOTICE TO SELLER: THIS CONTRACT IS BINDING ONLY UPON THE BUYER (LICENSEE) WHO PERSONALLY SIGNS ABOVE, UNLESS THE SUPERVISING BROKER OF THE BROKERAGE FIRM WORKING WITH SELLER SIGNS HERE:" More info: Why is this contract different from all the others which are binding on the company? Understand this addendum addresses a specific legal situation that has been rife with abuse, but is one that the Real Estate Commission has limited jurisdiction over, due to a little document called the United States Constitution.Typically the scenario is some variation of an agent promising to buy a property they have listed, from a not-too-sophisticated seller. The seller accepts a low ball price from the agent and when the closing is done, the agent immediately lists the property for a much higher price thereby pocketing a pretty penny. This is often referred to as "equity skimming". Problem is "equity skimming" is not illegal between a willing seller and buyer. If a seller wants to sell her Aspen mansion for a glass of Mom's lemonade to some guy who greeted her at a Walmart - she can do it. That is the Constitutional aspect of this scenario. Fact is, neither the Real Estate Commission or a Listing Brokerage can tell a willing buyer or seller what an acceptable deal is or is not.Having said that - since one of the parties (the buyer) is a licensee the Commission can make it harder and force the licensee to make certain the seller is fully informed. That is the Licensee Buyout Addendum. First up, they established under what circumstances must a licensee use the addendum: when a licensee enters into a contract to purchase a property, if one of the following fits, the agent must use the addendum: (1) concurrent with the listing of such property; (2) as an inducement or to facilitate the property owner's purchase of another property; or (3) continues to market that property on behalf of the owner under an existing listing contract . . .Notice that the addendum does not have to be used every time an agent buys a client's property. Only if one of the above exists. Agents who are buying fix and flips, rentals, or for a personal residence are off the hook.If it does apply, the addendum deletes certain provisions in the real estate listing contract including: property's appraisal condition (i.e. buyer cannot get out of deal if it does not appraise), liquidated damages (i.e. buyer gets cold feet and wants to back out the seller can sue), provisions related to the seller's financial default status and the broker's acknowledgments and compensation disclosure forms (ouch! - no sales commission for the agent. Now do you want the property?). Pretty strong stuff. There are also disclosures to the seller that the buyer is a licensed real estate professional and any future profit or loss on a resale of the property is solely that of the buyer. Similarly, the addendum protects the seller by acknowledging that fees related to closing, holding and reselling the property are all the responsibility of the licensee/buyer and not the seller. Toss in the earlier mention that the contract is not binding on the listing brokerage company unless the supervising broker signs, and the seller really has been fully informed of the potential consequences of this type of transaction. |
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A broker may deposit her personal funds in her trust account in which of the following situations? When a minimum amount is required by the bank to maintain the account Whenever she wants to -- it is withdrawals that are not allowed If an earnest money check bounces to cover the check When she had to use the escrow to pay her rent and she is putting the money back |
A: When a minimum amount is required by the bank to maintain the account Brokers may only deposit enough money in a trust account to maintain the minimum required balance. |
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Which of the following is required before an owner of a 35-parcel of undeveloped land may drill a well for water only? nothing is required; a 35-acre site is entitled to an exempt well the owner must purchase water rights the owner must obtain a well permit from the state engineer if there is a stream on the property it must be diverted |
A: the owner must obtain a well permit from the state engineer Small wells on domestic property must have a permit from the state engineer even though they are exempt from a requirement to purchase water rights. |
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A situation in which the tenant's lease has expired and the tenant is no longer paying rent, but is living on the property is known as: an estate for years estate at will estate from period to period estate at sufferance |
A: estate at sufferance In an estate at sufferance, the tenancy is by a lessee who lawfully occupies the landlord's property, but then continues to occupy the property improperly after his rights have expired, forcing the lessor to "suffer" the lessee's continued illegal occupancy. |
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Any excess funds above those required to pay off encumbrances realized at a foreclosure sale belong to: The State General Fund The mortgagee The mortgagor The Lender |
A: The mortgagor The Mortgagor is the owner of the property. The owner placed the voluntary lien on the property which the mortgage represents to secure a loan for the property. Money left over from the sale of the foreclosed property, after all obligations were settled, would have been returned to the Mortgagor (AKA foreclosed owners).The IRS views a foreclosure sale as a normal sale of the property. The owners would need to consider the tax consequences of the sale as the excess money may be viewed by the IRS as a capital gain and thus subject to capital gain taxes. More information about foreclosures in Colorado: Foreclosures: Foreclosure is the act of selling, by legal proceedings, real property to satisfy the obligations of the landowner to a third party. It is the procedure whereby property pledged as security is sold to pay the debt in the event of default in payment. There are three main types of foreclosure in the State of Colorado: The Public Trustee System: The Public Trustee, by law, serves as the neutral, intermediate party between the lender and the borrower to assure that each party can exercise its legal rights in a foreclosure action. The Public Trustee is NOT an attorney and cannot provide legal advice to any parties involved in the foreclosure action. A foreclosure conducted by the Public Trustee's office is authorized by a deed of trust containing a power of sale (right to sell property at public auction in the event of default). The procedure for conducting the foreclosure is set by statute and must be followed precisely. The deed of trust is an agreement between three parties: the Grantor (owner), the Public Trustee (who has the power of sale) and the Beneficiary (lender). Judicial Foreclosure:] Foreclosure conducted through the Court system on a mortgage, deed of trust, or judgment. The procedure for conducting the foreclosure is under Rule 105 of the Colorado Rules of Civil Procedure. A mortgage is an agreement between two parties: the Mortgagor (owner) and the Mortgagee (lender). The Tax Sale: The Tax Sale Sale of real property by the Treasurer for failure to pay real estate taxes. The procedure for conducting the sale is set by statue. |
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A brokerage firm holding 4 earnest money deposits, and 15 security deposits for managed single-family residences must have a minimum of how many trust accounts? 19 1 2 3 |
A: 3 Rule E-1 (h) A broker who manages less than 7 single-family residences may deposit rental receipts and security deposits and disburse money collected for such purposes in the "sales escrow" account" Elsewise, you need one escrow account for earnest money, one for rental receipts and one for rental deposits. Reference Colorado Real Estate Manual Chap 2 - Rule E-1 (h) |
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Andy is selling his property and has no knowledge of any plumbing system problems. In actuality, the pipes are seriously corroded and will require replacement very soon. How should Andy respond in the Seller's Property Disclosure when asked if the seller has any knowledge of plumbing system problems? yes no n/a The seller would not be the one required to respond to this question |
A: no Andrew should answer no, because he has no knowledge of any problems at the present time. |
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Publishing a foreclosure notice of sale in a newspaper is the duty of the: County Treasurer Public Trustee Lender County Assessor |
A: Public Trustee Sale date published for 5 consecutive weeks prior to sale |
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Under a percentage lease: Only a specified percentage, of a parcel of real estate, is covered The total annual rent paid by the tenant remains the same, throughout the lease term The percentage is based upon the amount of sales that the business is doing All of the above |
A: The percentage is based upon the amount of sales that the business is doing A percentage lease is used for commercial properties and calls for the tenant to pay a percentage of his gross or net income to the landlord as rent. |
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Unless modified, the powers granted in a Colorado statutory power of attorney for property are: Not applicable to property management A conflict of interest for a designated broker General in scope Limited to signing papers at closing |
A: General in scope Power of Attorney, unless modified, are general in scope. Usually they are modified by stating exactly what is allowed for a licensee to sign in the name of the client. Reference Uniform Statutory Power of Attorney Act, C.R.S. 15-1-1301 |
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The owner of subsurface mineral rights: must pay royalties to surface owner has no rights to enter and use surface of property may have the right to enter and use property must go to court to gain access to the rights |
A: may have the right to enter and use property As per the Contract to Buy and Sell real estate: "The surface estate may be owned separately from the underlying mineral estate, and transfer of the surface estate does not necessarily include transfer of the mineral rights or water rights. Third parties may hold interests in oil, gas, other minerals, geothermal energy or water on or under the Property, which interests may give them rights to enter and use the Property."Unless the deed transferring the mineral rights indicated a royalty, the owner is under no obligation to pay royalties to the owner of the surface rights. Rights are owned and may not require judicial approval to utilize. |
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The Colorado-approved Amend/Extend Contract form should be signed: before the listing expires after the sales contract expired before the sales contract has been accepted before the sales contract has been fully executed |
A: before the sales contract has been fully executed The Agreement to Amend/Extend Contract is used only to amend the terms and conditions of a sales contract while it is in process. You cannot amend a contract once it is complete (AKA "executed"), or terminated, or expired. More info: First make sure you understand the difference between the Agreement to Amend and Extend and the Agreement to Amend and Extend With Broker. Both agreements are used to alter the terms and conditions of a contract. The Agreement to Amend and Extend is used to alter the terms of the sales agreement between the buyer and seller. The Agreement to Amend and Extend With Broker is used to amend the terms of an agreement with the client and their broker such as a listing agreement or buyer agency agreement. As to why would you extend a contract before it is executed, understand the difference between the terms “executory” and “executed”. When a contract is signed by all parties it is in “executory” status. This means it is in process but not complete. When it is “executed” this means it is complete i.e. fully performed. Real Estate Commission rules say that you cannot amend the terms of an agreement after it has been expired, executed or otherwise terminated. When a closing occurs, the deal is done, the associated listing and sales contracts are fully executed, can't-be-changed, done, dead, history, ex-contracts, ended, finished, achieved, accomplished, done-with, taken-to-the-bank and all-over-including-the-shouting. |
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The Real Estate Commission has the authority to: audit or investigate a licensee and files at any time without advance notice audit or investigate a licensee and files at any time with advance notice audit or investigate a licensee only when a complaint has been filed |
A: audit or investigate a licensee and files at any time without advance notice § 12-61-113, C.R.S. Investigation – revocation – actions against licensee – repeal.(1) The commission, upon its own motion, may, and, upon the complaint in writing of any person, shall, investigate the activities of any licensee or any person who assumes to act in such capacity within the state... |
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An Employing Broker designates one seller agent and one buyer's agent. The Employing Broker has: agency with seller, not buyer limited agency agency with buyer, not seller no agency |
A: no agency If the employment contract is with a brokerage firm that consists of more than one licensed natural person, the employing broker or an individual broker employed or engaged by that employing broker shall be designated by the employing or supervising broker to work with the party as a “designated broker.” The employing or supervising broker may designate more than one of its individual brokers to work with a party as “designated brokers.” A brokerage relationship exists only with the individual broker(s) so designated. The duties, obligations, and responsibilities of that relationship do not extend to the employing broker, brokerage firm or to any other brokers employed or engaged by the brokerage firm. |
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When must a listing broker disclose to the buyer the broker's working relationship with the seller? In writing before providing specific real estate services In writing before any conversation or discussion In writing at the time the contract to buy and sell is signed Orally before writing the contract and in writing before closing |
A: In writing before providing specific real estate services The law requires disclosure in writing at the earliest practical moment. The commission allows conversation to build rapport but must disclose an agency relationship before eliciting or being given any confidential information from the buyer. |
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When an out-of-state investor sells a property in Colorado, which of the following is required of the closing entity? withhold up to 2 per cent of the selling price as a state transfer tax withhold up to 2 per cent of the selling price as possible income tax liability withhold up to 2 per cent of the net proceeds of the sale as sales tax withhold up to 2 per cent of the net proceeds of the sale as possible income tax |
A: withhold up to 2 per cent of the selling price as possible income tax liability When the seller is out of state after closing, the Colorado Department of Revenue requires withholding of the lesser of 2 per cent of the selling price or the entire net proceeds due to the seller at closing. |
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A tenant has a lease in a building for another 8 months, but the owner of the building sells the building and the closing is scheduled for the end of the month. The tenant's lease: terminates on the day of closing terminates 30 days after closing with written notification by new owner. converts to a month-to-month after the closing pending negotiations with the new owner is good as signed. |
A: is good as signed The lease is still valid as signed. Buying a property means you not only get the asset, but also the obligations. It is a bit like getting married - you get the good and the bad - you do not get to choose. |
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If an offer is given that fulfills all the terms of a contact and the seller rejects that offer - what happens? The listing broker is entitled to a commission The listing broker receives no commission The listing broker can sue for specific performance The listing broker is entitled to a partial commission for services rendered |
A: The listing broker is entitled to a commission When we, as agents, enter an agreement to market someone's property, we are tasked to bring them a "ready, willing and able buyer". We do that - we get paid. If we do that and the seller gets cold feet, rejecting an offer which met all of the seller's stated requirements, nobody can force the seller to sell, but we did our job and the seller may be liable for a commission to the listing agent. |
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Property taxes become a lien on January 1 for the previous year. When may taxes be paid without receiving a penalty: The first half payment by the last day of February, the second half payment no later than June 15 All payments no later than Dec 31 All payments by October 15 half payment by April 1, second half payment by July 1 |
A: The first half payment by the last day of February, the second half payment no later than June 15 If you are going to pay property taxes in one payment, that payment is due no later than April 30. If you choose to make two half payments; the first payment is due no later than the last day of February and the second payment not later than June 15. |
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To net the owner $90,000 after a 6% commission is paid; the list price would have to be: 95400 95745 95906 96000 |
A: 95745 $90,000 / 94% = $95,745; $95,745 x 6% = $5,745 |
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Relative to a contract to purchase and sell real estate: information must be abbreviated to fit within the preprinted blanks information may be added outside of the body of the contract preprinted information always takes precedence over inserted information inserted information must be typed or computer-generated |
A: information may be added outside of the body of the contract Information may be added outside the body of the contract. Usually this will be done on an Amend/Extend form. |
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A lease is made for an entire building and the land upon which it is located. The building is destroyed by fire. The lease contains no provision covering this situation. Therefore, the: lease continues, and the tenant is liable for the rent lessor must rebuild before he can collect additional rent insurance proceeds must be used to rebuild |
A: lease continues, and the tenant is liable for the rent A tenant who leases an entire building including the land, must continue to pay rent if the building is destroyed because the land can still be used. This would not be the case if only a portion of the building were being leased. |
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Charles is a broker who received a buyer's earnest money check for $5000 and immediately cashed it. At closing, Chatles gave the seller a personal check for $5,300 which represented the original earnest money plus interest. Which of the following is true? Charles properly cashed the check but did not need to pay the interest Charles should have deposited the money in his personal bank account and would have been entitled to keep the interest as a service fee Charles should have deposited the money in a trust account |
A: Charles should have deposited the money in a trust account Earnest money must be deposited in a proper escrow or trust account and may not be commingled with personal funds. |
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Broker Bill Butter is working with Buyer Brian Bread and has found a property on which the Buyer wants to place an offer. The property that he likes is owned by Seller Sammy Samuel and listed by Broker Cherry Cleary. The property is located at 2443 E Westgate Ave in Durango, CO. The asking price is $315,000. Buyer Bread offers $299,000 on April 10th and wants all appliances including the washer and dryer included in the sale price, the appliances were excluded in the listing as was the Hot Tub on the patio. The offer is countered by Seller Samuel on the recommendation of his agent Broker Cherry Cleary on April 11th at $309,000 and will include all appliances except the washer and dryer. Buyer Bread accepts this counter offer on April 12th and the closing is scheduled for May 25. An inspection is held on April 16th and Buyer Bread wants some roof shingles repaired and the carpet in the master bedroom to be replaced. Seller Samuel agrees to the shingles being repaired, but will only give a $750 credit at closing to the Buyer Bread to replace the carpet; Buyer Bread accepts. Prior to closing, Buyer Bread requests that the seller allow them to start a kitchen remodel prior to closing. Seller Samuel will not allow this and Buyer Bread gets angry and wants out of the contract. All of the following are reasons why the buyer could get out of the contract except: Cannot acquire acceptable financing prior to the “Loan Objection Deadline”.B y the “Off-Record Title Objection Deadline” if there is something in the off-record documents that the buyer does not agree with. The buyer feels the seller is being uncooperative The house burns down. |
A: The buyer feels the seller is being uncooperative
As long as the seller is following the contract the buyer has no recourse to terminate the contract. All of the other answers are reasons that the buyer may terminate the contract. Answer D automatically terminates the contract. |
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In a transaction broker situation, what responsibility does the principal have to the agent? To present all offers in a timely manner To account for funds A fiduciary responsibility He may have to pay a commission |
A: He may have to pay a commission Pursuant to the terms of an exclusive right to buy contract the buyer may be obligated to pay a commission. |
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The listing broker, AAA Realty, shows a house to the Smiths two days before the listing expires. The listing has a 30-day holdover period and no box is checked in the clause. The buyers call the broker back four days after seeing the house and want to buy it. The sellers have listed the house with another broker, Rogers Realty. The sellers accept the offer of the Smith’s to buy the house. Which of the following is true? AAA Realty is not entitled to a commission Rogers Realty is entitled to the listing and selling commission AAA gets the Buyers commission (for representing the buyer) and Rogers Realty gets the listing commission (for representing the seller) AAA Realty is entitled to the listing and the selling commission |
A: AAA gets the Buyers commission (for representing the buyer) and Rogers Realty gets the listing commission (for representing the seller) The new listing terminated the holdover period. Therefore AAA cannot claim a listing side commission, Rogers Realty is going to recieve the listing commission. However, since AAA is now representing the buyer, they will be entitled to the buy side commission. There is a checkbox in the Holdover Clause which would have allowed the Holdover clause to survive re-listing the property. Since this box was not checked, the default is that the Clause would not survive re-listing the home.The Holdover Period says that a listing broker may be entitled to a commission after the expiration of a listing contract for the period of time specified in the clause if: 1) the broker negotiated with the buyer during the listing period and 2) the broker submitted the name of this buyer in writing to the seller. Although the protection is for a negotiated time after the listing expires; it can terminate early if the property is re-listed by another agent and the "Shall Not" box is checked, meaning the old listing agent "shall not" be owed a commission if another brokerage firm has earned one. If neither the "Shall" or "Shall Not" be owned a commission" box is checked - the default is "Shall Not". See "Holdover Period" in the "When Earned" clause of an Exclusive Right to Sell listing agreement. |
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What happens if a defaulting buyer forfeits an earnest money deposit, according to the Exclusive-Right-to-Sell Listing Contract ? The seller is entitled to keep the funds. The broker and seller split the funds. The broker receives the funds. The broker and seller submit the funds for mediation. |
A: The broker and seller split the funds. The seller and the broker are allowed to divide the funds equally per the terms of the listing contract, but the contract specifically limits the broker's share to no more than the commission would have been. |
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The Colorado Statute of Frauds requires what in order for the contract regarding real estate to be enforceable? Tobe written by an attorney To be in writing To be signed by only the buyer That an agent cannot misrepresent the facts |
A: To be in writing The only exception is a base lease for less than one year.Statute of frauds which, in its essence says, “some things — some agreements — to be legally enforceable must be written down and must be signed.”So what contracts must be in writing? While it varies somewhat state-to-state, the following generally applies: • Contracts in consideration of marriage. • Contracts which cannot be performed within one year (such as leases of less than a year). • Contracts for the transfer of an interest in land.Contracts by the executor of a will to pay a debt of the estate with their own money. • Contracts for the sale of goods above a certain value. • Contracts in which one party acts as guarantor for another party's debt or other obligation. |
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A house was listed for $84,900, and the seller received $71,424 after the broker deducted her 7% commission. What was the selling price? 78957 76800 76423 75443 |
A: 76800 $71,424 / .93 = $76,800 |
