Real Estate

Front 1

The Real estate business has how many divisons?

Back 1

Two

1. Brokerage and

2. Land Development and Construction

Front 2

Brokerage

Back 2

Consists of sales, leasing, appraising, property management, and counseling

Front 3

Counseling

Back 3

Requires the most expertise

Front 4

Appraising

Back 4

🔹Is an art not science

🔹Are paid a fee not commission

🔹The fee is based upon the difficulty of the assignment and the time required performing the assignment

Front 5

Appraisers

Back 5

🔹Do not determine value

🔹they Estimate value

Front 6

The Market

Back 6

🔹Determines value

Front 7

Marketing Knowledge

Back 7

The type of knowledge that relates to prospecting for listings

Front 8

Contraction periods

Back 8

is when production decreases

Front 9

Overpricing

Back 9

the major reason that listings expire

Front 10

The Wilsons have contracted to purchase a home for $412,000, contingent on the property appraising for the offered price. When the appraisal comes in at $400,000, the contract is

Back 10

Voidable

Front 11

A sales associate employs a licensed personal assistant. The assistant will prepare comparative market analyes (CMAs), design property flyers, hold open houses, and prospect for listing appointments. The assistant will be paid a salary of $12 per hour and 20 percent of the commissions received by the sales associate. The method of payment will satisfy all legal requirements is

Back 11

the associate may pay the salary and must withhold taxes on the salary, but the broker must pay commissions.

Front 12

A licensee reviews her sales records and finds that she made $3,200 in gross income for every 100 new contacts she made last year. If she works hard this year and makes 700 new contacts, her gross income would be expected to grow by

Back 12

$22,400

Math

700/100= 7

7 x $3,200 = 22,400

Front 13

A sales associate is a transaction broker. If a prospective buyer asks why the seller is selling, the sales associate

Back 13

may not disclose the motivation because of the duties of limited confidentiality

Front 14

Supply and demand (a principal)

Back 14

when the supply of listed homes increases without a corresponding increase in sales, lower prices result.

Front 15

To avoid creating sales tax liability in the sale of a condominium, a sales associate should

Back 15

avoid listing a price for each separate piece of furniture but can itemize each item, if desired

Front 16

a 2010 change to the Federal Lead-Based Paint Hazard Reduction Act requires that

Back 16

contractors disturbing paint in a property built before 1978 take an 8-hour course and become certified

Front 17

Designated sales associate

Back 17

The brokerage relationship limited to only nonresidential licensees.

Front 18

The sales price of a home is $185,000, subject to a first mortgage of $121,300. The seller owes a 6 percent commission to the broker. The seller's equity is

Back 18

$63,700

Math

$185,000(sales price) - $121,000 (1st mortage) = $63,700

Front 19

changes in the general business economy fall into three categories-cyclic, random and

Back 19

Seasonal

Front 20

a house sold for $185,000. Based on the figures below, what are the total expenses rounded to the nearest $100?

Back 20

math

Brokerage fee 7%

Title insurance $800

Termite insurance $50

Documentary stamps deed

$15,100

Front 21

a sales associate is making up a seller's net proceeds statement. The figures she gathers are

existing first mortgage at 8% $121,300.00

Property taxes for the year $2,245.60

Interest proration (paid in arrears) ?

Closing date June 30

Back 21

math

What are the total prorations to the nearest $100? Will the prorations be added to, or subtracted from, the equity?

$1,900; subtract

Front 22

if the sales price of a home is $198,000, the mortgage balance is $127,300, expenses are $11,800, and prorations for taxes and interest are $2,800 (paid in arrears), the seller's net proceeds are

Back 22

math

$56,100

198,000 - 127,300 = 70,700

70,700 - 11,800 = 58,900

58,900 - 2,800 = 56,100.00

Front 23

The order of the general business cycle is

Back 23

expansion, recessions, contraction, recovery

Front 24

If a customer calls on a real estate ad, but the house has been sold, the sales associate should

Back 24

refer to his fallback list so he can set an appointment to show other homes

Front 25

Parroting

Back 25

when a sales associate, to test her understanding of the customer's comments, repeats the customer's words exactly.

Front 26

Lenders expect their title to be insured with

Back 26

a title policy insured for the amount of the loan in the American Land Title Association (ALTA) form

Front 27

The brokerage relationship notice that must be signed by the customer is the

Back 27

consent to transition to transaction broker notice

Front 28

Under the Junk Fax Protection Act, if a customer requests to opt out of getting future faxes, some requirements are

Back 28

1. Identify the fax number or numbers to which it relates.

2. Send the request to the telephone number identified on the fax advertisement

3. Send the request to the email address identified on the fax advertisement.

Front 29

a junk contractor who disturbs paint in a 40-year-old house must

Back 29

be certified and follow specific work procedures

Front 30

the annual interest rate cap on a FHA adjustable-rate loan is

Back 30

1 percent

Front 31

a seller's equity is the

Back 31

property value less mortgage balances

Front 32

Listening skills

Back 32

1.Understand

2. Hear

3. Evaluate

Front 33

Open Listings

Back 33

allow the owner to personally sell the property without paying a commission

Front 34

a brokers may make appraisals in a non-federally related transaction only if

Back 34

prepared according to USPAP requirements

Front 35

a sales associate who discusses "floor duty" with a customer is

Back 35

using Jargon

Front 36

in an exclusive agency listing agreement

Back 36

one broker lists the property and is not paid if the owner sells it

Front 37

Florida home inspectors

Back 37

must have a high school diploma, complete a 120-hour course, and pass a state examination

Front 38

an owner paid $38,000 to put in a swimming pool and an appraiser values the pool the same year at $14,000. This demonstrates the principal of

Back 38

contribution

Front 39

The knowledge or skill that will MOST help a sales associate effectively present a contract to a seller is

Back 39

communication skills

Front 40

Operating expenses are composed of reserves for replacements, fixed expenses, and

Back 40

variable expenses

Front 41

when showing property, the sales associate should

Back 41

1. request that the sellers vacate the house during the showing

2. suggest that the sellers remove dogs or restrain them before showing

3. call the sellers after leaving the last house to give notice that their house will be shown next

Front 42

a buyer may expect from the single agent seller's broker the duty of

Back 42

disclosure of material facts affecting the property value

Front 43

Written listing agreements must include a(n)

Back 43

expiration date

Front 44

Leonard is evaluating a $400,000 mortgage. He can get a 30-year 6 percent fixed-rate mortgage with principal and interest payments of $2,398.20 with no points. He can also get a 5.75 percent mortgage loan (payments of $2,334.29) with two points. Using simple arithmetic, how many months will it take him to break even lower interest rate loan?

Back 44

math

68 months

Front 45

The new Good Faith Estimate (GFE)

Back 45

1. Has three pages

2. Has tolerances for accuracy

3. Shows lender origination fees and discount points

does not- show total amount due from the buyer at closing

Front 46

In order to have a successful listing presentation, as described in the course material, the sales associate should

Back 46

1. have all property owners who need to sign the listing available

2. know the presentation thoroughly

3. have prepared a comparative market analysis

NOT - be prepared to reduce the commission if asked to do so by the sellers

Front 47

The Florida Association of Realtors Exclusive Right of Sale Listing Agreement provides that if the sellers withdraw the listing before the listing protection period is over, the sellers

Back 47

may be liable for the full commission if they transfer the property during the protection period

Front 48

if a property's exact size and description is not known at the time a contract is drafted, the parties should

Back 48

1. agree to have a survey made before closing

2. give the buyer the right to void the contract if the size of the property as shown by a subsequent survey is not substantially as represented

3. agree to amend the legal description shown in the contract to that based on a survey

NOT- close the transaction until a survey shows an accurate legal description.

Front 49

Annual changes in the economy are

Back 49

seasonal fluctuations

Front 50

Unlicensed personal assistants may perform any of the activities shown below

Back 50

1. receive, record, and deposit earnest money deposits

2. schedule appointments for a licensee to show listed properties

3. be at an open house to hand out brochures

NOT- negotiating a commission split with a cooperating broker

Front 51

The questions asked when qualifying the buyer for her housing needs are

Back 51

1. what part of town do you want to live in

2. is there someone else who will be helping you make a decision

3. how soon do you need to move

NOT - What is your gross monthly income

Front 52

a couple apply for a new 30-year fixed-rate mortgage of $195,000. The mortgage principal and interest payment factor is $.005522. Taxes for the year are $4,800 and insurance is $2,400. What will they pay in monthly payments (PITI)

Back 52

Math

$1,676.79

Front 53

Sales associates' first customers when starting in real estate are usually

Back 53

in their sphere of influence

Front 54

if a contract is written for the sale of a condominium, the sales associate would include the legal descriptions

Back 54

1. county in which the property is located

2. condominium unit and parcel number

3. name of condominium complex

NOT- dimensions of the property

Front 55

to improve her credit score, a person should

Back 55

1. pay bills on time

2. pay down outstanding balances

3. avoid debt of any kind

NOT- take on additional credit cards

Front 56

a construction lien on a property would be considered by a title examiner as a

Back 56

cloud on the title

Front 57

When ordering title insurance, the sales associate need to give the title closing agent a

Back 57

1. signed, dated sales contract

2. previous title policy, if available

3. complete legal description of the property

NOT- a copy of the previous deed

Front 58

The most important component of a credit score is

Back 58

payment history

Front 59

Tim has a goal of making $64,000 in gross collected commissions next year. He feels that his listings that sell should contribute about 60 percent of the required income. The average commission per transcation in his office is $2,400, and about two-thirds of his listings are expected to sell. He gets about four listings in five listings presentations. Approximately how many presentations will he have to make monthly to stay on target?

Back 59

math

2.5

Front 60

in order to be confident of a prospective buyer's financial qualification, a sales associate should

Back 60

take the buyer to a lender for qualifying or preapproval

Front 61

when comparing a 30-year fixed-rate mortgage to a 15-year fixed-rate mortgage, the 30-year loan

Back 61

has slightly higher interest rates

Front 62

if a broker has used the Florida Association of Realtors Exclusive Right of Sale Listing Agreement, and gets into a conflict with the seller, the

Back 62

conflict must be first submitted to a mediator

Front 63

Except in unusual circumstances, sales associates should limit the number of houses shown in one tour to

Back 63

five homes

Front 64

the conditions required when selecting a comparable property for an appraisal

Back 64

1. similar to the subject property

2. sold recently in the same neighborhood

3. changed hands in an arm's-length transaction

Front 65

Susie's goal for this year is "to make a good living." the most correct statement about her goal is

Back 65

it is not measurable

Front 66

upon Showing homes

Back 66

negative features should be discussed on the way to the property

Front 67

when preparing for a closing, a previous deed is found to be defective. If it can't be cleared by ordinary means

Back 67

a suit for quiet title must be filed to solve the problem

Front 68

a property that sold is ruled out as a comparable sale. The MOST likely reason is that the home

Back 68

is in a different neighborhood, even though there are many comparable sales in the subject property's neighborhood

Front 69

a listed home was the site of a homicide three years earlier. What disclosure to the buyers is required by Florida Statute 760?

Back 69

neither the licensee nor the seller is legally required to disclose the homicide

Front 70

Option

Back 70

a contract that requires only one party to perform

Front 71

when preparing an offer on the Florida Association of Realtors Residential Contract for Sale and Purchase, the sales associate should

Back 71

ensure that each buyer shown in the contract signs the signature line of the contract.

Front 72

a buyer inserts a home inspection contingency and has ten days to complete the inspection and notify the seller of deficiencies. The inspection has some serious deficiencies. On the 11th day, the buyer notifies the seller that she wants the seller to correct the deficiencies. A review of the contract will show that the

Back 72

contingency expired and cannot be used as a reason for voiding the contract

Front 73

a residential broker may work with a buyer in all of the following ways

Back 73

1. as a single agent

2. with not representation

3. as a transaction broker

EXCEPT- as a designated sales representative

Front 74

If owners must be members of a community association, the seller need NOT disclose to the buyer

Back 74

the previous sale price of the home

Front 75

Transaction Brokers

Back 75

are Brokers who have limited confidentiality duties to buyers and sellers

Front 76

Under the Americans with Disabilities Act, architectural barriers must be removed to maximize accessibility if it is readily achievable to do so. Readily achievable means

Back 76

the removal of barriers must be accomplished with little difficulty or expense

Front 77

after listing a home, the broker must deliver a copy of the signed listing agreement to the seller

Back 77

within 24 hours

Front 78

John is considering the purchase of a new home using an adjustable rate mortgage (ARM). His broker suggests that he get an FHA ARM loan rather than a conventional ARM loan because the FHA ARM has

Back 78

more attractive interest rate caps

Front 79

John is developing a new strip shopping center. Which parking lot design features must be included to meet the requirements of the Americans with Disabilities Act?

Back 79

there must be at least one accessible space for every 25 total spaces

Front 80

brokerage relationship disclosures must be kept in the broker's files for

Back 80

five years

Front 81

for home mortgages signed on or after July 29, 1999, private mortgage insurance (PMI) must, with certain exceptions, be terminated automatically when the borrower has

Back 81

achieved 22 percent equity in the home based on the original property value

Front 82

a brokerage firm that conspires to fix prices violates

Back 82

antitrust laws

Front 83

redlining

Back 83

a loan officer raises the interest rate because the home is located in a minority area. This illegal practice

Front 84

The Americans with Disabilities Accessibility Implementation Act protects

Back 84

1. persons who are mentally impaired

2. persons who are blind

3. persons who are recovering from substance abuse

NOT- Juvenile offenders

Front 85

Holding an open house on a property

Back 85

1. it is a good method of finding prospective buyers

2. the sales associate should prepare a brochure or flyer for prospective buyers

3. an additional list of properties for sale should be prepared and ready if this home does not meet the prospect's needs

NOT- the licensee must immediately give any visitors who are prospective buyers either a single agent notice or a transaction broker notice

Front 86

Phases of Economic cycle

Back 86

contraction, expansion, recovery

Front 87

a valid six-month lease need

Back 87

1. include a legal description of the property

2. have the term of occupancy

3. have competent parties

NOT- be in writing and signed

Front 88

a loan closes on July 7, and the first payment will be due on August 1. To account for the prepaid interest, the buyer will be

Back 88

charged from July 7 through July 31

Front 89

among the steps shown in the home-showing process, the correct order is

Back 89

Set appointment, preview properties, plan the route, evaluate buyers' interest, write contract

Front 90

a sales associate who fails to prepare a comparative market analysis and suggests an improperly low listing price might be violating a duty of

Back 90

skill, care, and diligence

Front 91

during a meeting with a customer, sales associate Hank uses the same body language as the customer. Hank is using a reflecting method called

Back 91

mirrioring

Front 92

a buyer makes a preclosing walk-through inspection. the purpose is to determine whether

Back 92

1. the property is ready for occupancy

2. personal property the seller is required to leave remains on the property

3. all required maintenance and repairs have been completed

NOT- there are structural problems in the property

Front 93

while describing the brick exterior on a home to a buyer, the licensee says, "This should reduce your home insurance compared to wood siding." In a sales presentation, this statement is called the

Back 93

benefit

Front 94

when a property manager prepares a neighborhood market analysis, the major factors to be assessed include

Back 94

1. transportation and utilities

2. the economy

3. boundaries and land usage

NOT- depreciation allowances

Front 95

Nonresidential sales associates

Back 95

may be appointed as a designated sales associate for one party if the broker appoints another sales associate in the firm to be the designated sales representative for the other party

Front 96

this would be included in the operating expenses section of an income property financial statement

Back 96

Property taxes

Front 97

It is legally acceptable to advertise "adults only" in a classified ad for an apartment property when

Back 97

at least 80 percent of the units have at least one occupant who is at least 55 ears of age

Front 98

before a closing takes place, a sales associate working with the buyer should refrain from

Back 98

contacting the seller to ensure that all documents were delivered

Front 99

when presenting an offer to the sellers through the listing broker, a licensee should do everything

Back 99

1. make enough copies for all parties

2. allow the parties to discuss the offer without being present

3. distribute copies of the contract before discussing all other contract contingencies

EXCEPT - give the original copy of the offer to the sellers

Front 100

the type of property maintenance that involves actual repairs is

Back 100

corrective

Front 101

most tenant-management problems involve

Back 101

maintenance service requests

Front 102

Real estate buyers and sellers are liable only for the acts of there

Back 102

single agent

Front 103

a private homeowner may NOT discriminate in the sale of his residence based on race

Back 103

because of the Civil Rights Act of 1866

Front 104

You would NOT want to take a listing from

Back 104

an unmotivated seller

Front 105

In what way do MOST sales associates find for sale by owners (FSBOs)

Back 105

In classified newspapers ads