Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
35 Cards in this Set
- Front
- Back
|
A real estate broker's advertisements need to include: a. the name of the broker and license number. b. a statement that the advertiser is a broker or agent. c. the address of the broker. d. the number of years the broker has been licensed. |
a. the name of the broker and license number. (Without the disclosure of the broker's name and license number, this type of advertisement is considered a prohibited "blind ad.") |
|
|
An unlicensed assistant may: a. show property to prospective buyers. b. encourage a prospective client to use the broker's services. c. discuss the terms or conditions of a possible sale. d. prepare a comparative market analysis (CMA) for a client. |
d. prepare a comparative market analysis (CMA) for a client. (An unlicensed assistant may be employed to perform nondiscretionary administrative activities, such as write up documents including contracts and comparative market analyses (CMAs), as long as they are reviewed by the broker. However, most interactions with the public are not allowed.) |
|
|
Roland, a broker, arranges a sale and opens escrow. Before escrow closes, his license is revoked by the Department of Real Estate (DRE). What happens to Roland's commission? a. Roland's commission goes to the Real Estate Education Research and Recovery Fund. b. The seller does not have to pay any commission. c. The commission is split between the buyer and seller. d. Roland gets his commission. |
d. Roland gets his commission. (The broker's commission is earned when a ready, willing, and able buyer is found. Thus, since the broker was licensed at the time he procured a buyer as contracted for, he is able to collect his fee.) |
|
|
Robert, a developer who is unlicensed, hires Yvonne, a broker, to sell his properties. While Yvonne is out of town, Robert shows property, quotes prices and makes sales. Have Robert or Yvonne violated the Real Estate Law? a. Yvonne has violated the Real Estate Law and can be fined $500. b. Robert has violated the Real Estate Law and can be fined $500. c. Both Robert and Yvonne have violated the Real Estate Law. d. Neither Robert nor Yvonne has done anything wrong. |
d. Neither Robert nor Yvonne has done anything wrong. (Robert is the owner of the property being sold. Thus, the sale is considered a for sale by owner (FSBO) transaction which does not require a license, as the private seller is acting for their own account, not as an agent of another.) |
|
|
Which of the following is true? a. Every real estate broker needs to maintain a definite place of business in California. b. An advertisement must include the licensee's name and license number. c. Both a. and b. d. Neither a. or b. |
c. Both a. and b. (A licensee's name and license number is required on all promotional materials, including business cards. Further, a broker needs to have a physical address on record with the Department of Real Estate (DRE) to receive mailings and be subject to state audits.) |
|
|
A prohibition against a "For Sale" sign in a residential neighborhood: a. is permitted, provided it applies to everyone in the neighborhood equally. b. violates the Fifth Amendment. c. violates the First Amendment. d. violates the Fourteenth Amendment. |
c. violates the First Amendment. (Prohibiting the display of “For Sale” signs is a violation of the First Amendment freedom of speech right and prohibits the free flow of truthful commercial information. A homeowners’ association (HOA) may impose reasonable rules about the posting of a For Sale sign, though cannot prohibit it.) |
|
|
If a group of brokers agreed to divide a market area or set commission rates, it would: a. be a cooperative business practice. b. create an extra protection for consumers. c. violate Real Estate Law. d. violate Anti-Trust Law. |
d. violate Anti-Trust Law. (Any restraint of trade is a federal anti-trust violation.) |
|
|
Any suggestion by a licensee that the racial makeup of a neighborhood is changing to induce panic selling is an example of: a. blockbusting. b. steering. c. redlining. d. usury. |
a. blockbusting. (Blockbusting, also known as panic selling, is the prohibited practice of inducing a person to offer a dwelling for sale by creating fear over the changing demographics within the neighborhood.) |
|
|
Any suggestion by a licensee that the racial makeup of a neighborhood is changing to induce panic selling is an example of: a. blockbusting. b. steering. c. redlining. d. usury. |
a. blockbusting. (Blockbusting, also known as panic selling, is the prohibited practice of inducing a person to offer a dwelling for sale by creating fear over the changing demographics within the neighborhood.) |
|
|
The Uniform Commercial Code, which pertains to a bulk sale transfer, exists primarily for the protection of: a. creditors. b. buyers. c. sellers. d. customers. |
a. creditors. (Creditors need protection from those who might attempt to walk away from their debt obligations.) |
|
|
When purchasing a business, the buyer needs to be certain a certificate of clearance has been issued by the: a. Secretary of State (SOS). b. Department of Business and Transportation (DBT). c. Alcoholic Beverage Control (ABC). d. State Board of Equalization (SBOE). |
d. State Board of Equalization (SBOE). (The certificate of clearance, issued by the State Board of Equalization (SBOE), assures the buyer of a business opportunity that any taxes due have been paid.) |
|
|
The best guideline to determine whether an action is ethical can be found in: a. state legislation. b. the Business and Professions Code. c. the Preamble of the National Association of REALTORS®. d. what is in the best interest of the real estate licensee. |
b. the Business and Professions Code. (Real estate brokerage is a profession. Therefore, any question about proper business practice is controlled by the Business and Profession Code.) |
|
|
A prospective buyer is interested in purchasing a vacant lot in a rural subdivision. The buyer wishes to know about sewer assessments, liens, utilities to the lot, blanket encumbrances and street maintenance. The source that provides all of this information is the: a. county planning director. b. county Board of Supervisors. c. county engineer. d. Real Estate Commissioner. |
d. Real Estate Commissioner. (The Real Estate Commissioner issues a public report on all rural subdivisions containing this sought after information.) |
|
|
If a licensee's name is on a list of obligors who have not complied with a court-ordered payment of child support, the licensee's renewal application will: a. renew as a suspended license until paid. b. be suspended until they have paid the delinquent amount. c. renew as a temporary license, but the debt must be paid within 150 days. d. be renewed for a one-year term only, unless the licensee submits proof from the District Attorney the debt has been paid. |
c. renew as a temporary license, but the debt must be paid within 150 days. (On renewal of their license, failure to pay child support will cause a licensee to receive a temporary license allowing 150 days to resolve the arrears.) |
|
|
A buyer of a common interest development (CID) is entitled to receive all except copies of: a. a homeowner warranty. b. the governing conditions, covenants and restrictions (CC&Rs). c. the homeowners' association (HOA) bylaws. d. the HOA's financial statement. |
a. a homeowner warranty. (A buyer of a condominium or property in a planned urban development (PUD) has the right to receive copies of all the association and subdivision information and documents. A homeowner warranty is an insurance policy that is purchased separately by the buyer.) |
|
|
Under the Alquist-Priolo Special Studies Act, a subdivider is required to disclose to potential purchasers: a. earthquake fault lines. b. flood hazard zones. c. environmental issues. d. the existence of nearby military ordinances. |
a. earthquake fault lines. (This is the earthquake disclosure law.) |
|
|
It is least likely to be a violation of the Real Estate Law for a broker to pay a portion of the commission to a(n): a. unlicensed assistant. b. a salesperson working for another broker. c. unlicensed person who obtained the listing. d. buyer or seller in the transaction. |
d. buyer or seller in the transaction. (Paying a portion of their commission to a buyer or seller in a transaction is allowable provided full disclosure is made to all parties. Each of the other answer selections is against the law.) |
|
|
Earthquake fault zones need to be disclosed to prospective buyers of certain properties in California. Typically, earthquake fault zones are: a. 0.25 miles wide. b. 0.5 miles wide. c. 1 mile wide. d. 2.5 miles wide. |
a. 0.25 miles wide. (Earthquake fault zones are a quarter of a mile wide.) |
|
|
Which of the following state agencies is empowered to prevent acts of discrimination in housing accommodations in California due to race, color, sex, national origin or ancestry: a. the Department of Real Estate (DRE). b. the Unruh Department. c. the Department of Fair Employment and Housing. d. the Department of Housing and Urban Development (HUD). |
c. the Department of Fair Employment and Housing. (The Department of Fair Employment and Housing is the state agency empowered to enforce Fair Housing laws.) |
|
|
A Latino real estate agent working in a Hispanic neighborhood informed current owners they should move out because another ethnic group is moving into the area. This conduct is an example of all of the following, except: a. blockbusting. b. panic selling. c. a legal practice, but unethical. d. an illegal practice. |
c. a legal practice, but unethical. (Discrimination can occur among any protected group. Here's an example of a question that can cause confusion simply by the structure of answer choice C. If the act is illegal (answer choice D), then it cannot be legal regardless of being classified as ethical or not.) |
|
|
A broker chooses to employ their salespeople as independent contractors rather than employees. By doing so, the broker will save out of pocket expenses relating to: a. automobile insurance. b. errors and omissions insurance. c. social security. d. advertising. |
c. social security. (A broker needs to pay into social security for an employee, but not for an independent contractor.) |
|
|
When inspecting a residence in a hillside subdivision, the salesperson observes cracks in the foundation and notices the doors and windows do not close properly. As a matter of best practice, the salesperson references their observations in the Transfer Disclosure Statement (TDS) and recommends that which of the following be ordered? a. A home warranty policy. b. A special studies report. c. A soil engineer's inspection. d. A termite clearance. |
c. A soil engineer's inspection. (Here's an example of arriving at the correct answer by eliminating the wrong answers. Though the other answer selections moderately relate to a property, the existence of cracks in a hillside subdivision indicates there may be a problem with the soil under the property, which is best diagnosed by a soil engineer.) |
|
|
After an applicant passes the real estate licensing exam, they need to apply for a license within: a. one year of the examination. b. one year after being notified of the test results. c. two years from the date of the exam. d. six months of being notified of test results. |
a. one year of the examination. (An applicant needs to apply for a license within one year of passing an examination.) |
|
|
An unlawful detainer (UD) action is instigated by: a. a grantor. b. a trustee. c. a lessor. d. a real estate broker. |
c. a lessor. (An unlawful detainer (UD) action is the court procedure to force a tenant to vacate the rental space they do not have the right to possess. A lessor (landlord) is the aggrieved person who initiates this process against an individual who holds no right to occupy a property, such as a holdover tenant.) |
|
|
Most real estate records need to be kept for a period of three years, commencing from the date that a property is first listed or the date: a. the agent meets a client. b. the sale occurs. c. escrow closes. d. the buyer's first property tax bill is due. |
c. escrow closes. (Record keeping commences from when the listing was signed or when the sale was complete, i.e., the close of escrow.) |
|
|
An example of a red flag would be: a. a cited code violation. b. a home overbuilt for the neighborhood. c. a floor that is not level. d. an older home. |
c. a floor that is not level. (A red flag is something that alerts an agent of a previously unknown potential physical problem with a property. The only answer selection that is consistent with this is an uneven floor.) |
|
|
If a seller refuses to fill out their section of the Transfer Disclosure Statement (TDS), the seller's agent is advised to: a. give written notice to the buyer of their right to receive such a TDS. b. accept the listing and obey the seller's direction not to disclose any negative property issues. c. complete the listing agent's portion of the TDS and deliver it to the buyer without the seller completing their section of the form. d. obtain the buyer's waiver of their right to receive a copy of the TDS. |
c. complete the listing agent's portion of the TDS and deliver it to the buyer without the seller completing their section of the form. (This is the best answer choice. However, as a matter of best practice, the seller's agent is to explain to the seller their obligation to accurately complete their portion of the Transfer Disclosure Statement (TDS).) |
|
|
Both a seller and a buyer ask the broker to give them the trust funds deposited by the buyer. How is the broker to respond? a. Begin a surrender action. b. Turn the funds over to the Real Estate Recovery Fund. c. Declare an equitable assignment of the funds. d. Commence an interpleader action to resolve the dispute. |
d. Commence an interpleader action to resolve the dispute. (This is a terminology question. An interpleader action is a legal process asking the court to resolve the dispute between the principals.) |
|
|
Freddie, an unlicensed employee of a real estate broker, hands out door hangers and makes telephone solicitations seeking buyers and sellers. Under the real estate law, these activities are: a. unethical for the broker who employs Freddie as an unlicensed employee. b. commonly accepted behavior in the brokerage community. c. unlawful for Freddie. d. unlawful for both Freddie and his employing broker. |
d. unlawful for both Freddie and his employing broker. (An employing broker is liable for any wrongful act conducted by their employee.) |
|
|
A public walkway within a condominium community: a. needs to be at least five feet wide. b. must be made of concrete. c. exists in a common area. d. is maintained by individual owners. |
c. exists in a common area. (Can you visualize exceptions that would make answer selections A and B incorrect? For instance, some walkways may be narrower than five feet or made of asphalt. Answer choice D cannot be correct, as the homeowners' association (HOA) within a condominium community is responsible for the maintenance of common areas and facilities. Thus, C is the best option as public walkways always exist in a common area in an HOA community.) |
|
|
Which of the following conditions would not cause a building to be declared uninhabitable? a. Dampness in the habitable rooms. b. Electrical wiring that is safe and working properly but does not comply with present building codes. c. There is no heating in the entire property. d. A broken window at the back of the house. |
b. Electrical wiring that is safe and working properly but does not comply with present building codes. (This question is phrased in the negative. Answer selections A, C and D render the rental property uninhabitable. The electrical wiring (a significantly longer answer and more detailed answer selection), does not trigger the inhabitable defense since it is safe and functional even though it does not meet current building codes.) |
|
|
If a tenant moves in and pays one month's rent prior to receiving a written copy of a verbally agreed-on two-year lease, the tenant has a(n): a. tenancy at sufferance. b. periodic tenancy. c. estate for years. d. estate at will. |
b. periodic tenancy. (Due to the fact the tenant moved in and began paying rent, these activities signifying periodic tenancy take precedence over the verbal lease agreement.) |
|
|
A seller's broker earns their commission: a. by finding buyers who are ready, willing and able to buy. b. by diligently attempting to market property on behalf of a seller. c. the moment they list properties. d. on the close of escrow. |
a. by finding buyers who are ready, willing and able to buy. (The key word in the question is "earned." When the buyer who is ready, willing, and able has been found, the commission is earned. Another question might ask "when" the commission is generally received, which is the close of escrow.) |
|
|
A right to later buy a property at an undetermined price given to a tenant that does not compel the owner to sell is an example of a(n): a. land contract. b. lease with an option to purchase. c. right of first refusal. d. contract of adhesion. |
c. right of first refusal. (This is the only the answer selection which meets all the requirements set forth in the question. Options and contracts both obligate the seller and stipulate an agreed to price. A right of first refusal is a pre-emptive right to buy a property if the owner decides to sell.) |
|
|
Title VIII, also known as the Federal Fair Housing Act, refers to the: a. Civil Rights Act of 1968. b. Unruh Act. c. Civil Rights Act of 1964. d. Civil Rights Act of 1866. |
a. Civil Rights Act of 1968. (The Unruh Act is California specific. The Civil Rights Act of 1964 is in reference to voting rights legislation. Thus, the correct answer is A. Civil Rights Act of 1968. Notice the Civil Rights Act of 1968 has been addressed in several previous questions, which may be helpful when answering this question.) |
