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California Real Estate (Principles) Questions And Correct Detailed Answers (Verified Answers) Already Graded A+
- To have a valid recorded homestead, certain elements are essential. Which of the
following is not essential?
Correct Answer: to be a married person
2. A ''loss in value from any cause'' is a definition of:
Correct Answer: Depreciation
- A couple recently married and each person had children from a previous marriage.
They wish to take title to property so they can pass their share to their own children by
will. The best form of title would be:
Correct Answer: Community Property
4. A valid deed passes title when it is:
Correct Answer: delivered and accepted.
- In July, Easton bought Rothchild's home through the listing broker, McGrew. After a
hard rain in November, the roof developed a severe leak. Easton sued Rothchild and McGrew for the cost of a new roof. Testimony in court revealed that Rothchild mentioned the need for a new roof to Broker McGrew. McGrew did not tell Easton about the need for a new roof. What would most likely occur?
Correct Answer: Easton would collect from Rothchild; Rothchild would then seek
recourse from McGrew.
6. The main purpose of the Truth-in-Lending Act is to:
Correct Answer: require disclosure of credit terms.
7. The difference between judgment liens and mechanics' liens is that:
Correct Answer: mechanics' liens can take priority before they are recorded.
- Broker Santos is in the process of listing a home. The agency disclosure must be
given:
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Correct Answer: prior to the seller signing the listing agreement
- On October 1, 2008, Garcia agreed to purchase Chan's home. Both parties agreed
that escrow would close on December 1, 2008, and that property taxes would be prorated as of date of possession. On November 1, 2008, Chan paid the property taxes for the year 2008-2009. According to the escrow closing statement, which of the following is true?
Correct Answer: Garcia paid Chan for 8 months' taxes.
10. A quitclaim deed conveys only the present rights of the:
Correct Answer: grantor
- A licensed loan broker arranged for a loan and has the borrower sign the required
statement. The broker then discovers a lien that the borrower did not disclose. If the
loan cannot be arranged due to the lien, the borrower is liable for:
Correct Answer: all cost and expenses and half the commission
- A person purchased a property for $200,000, which was equal to $4.75 per square
foot. The rectangular lot was 300 feet deep. The cost per front foot was:
Correct Answer: $1,425
(Calculation: $200,000 / $4.75 = 42,105.26 sq. ft. / 300 ft. = 140.35 front ft. Then $200,000 /
140.35 = $1,425)
- Which of the following is not essential to form an agency?
Correct Answer: a fiduciary relationship
(Note: fiduciary is a result of agency, but not needed to form an agency)
- An owner sells a lot for cash and receives $67,100 from escrow. The only expenses
were a 6 percent commission and $517 in other expenses. The property sold for:
Correct Answer: $71,933
(Calculation: $67,100 + $517 = $67,617. This represents 94% of the total. $67,617 / 0.94 =
$71,933)
- A real estate agent must disclose all material facts to a seller principal. Which of
the following is considered a material fact?
Correct Answer: the agent's knowledge of a pending better offer
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16. In appraising improved property, the least important factor is:
Correct Answer: assessed value
- Common interest developments in the form of community apartments and
condominium projects fall within the California Subdivision Act and:
Correct Answer: are regulated by state law
(Subdivision Map Act: 2 or more units)
18. Studs are attached to rest upon the:
Correct Answer: sole plate
- A person borrowed 80 percent of the value of a studio condo. The loan interest rate
was 7 percent. The first-year interest was $10,500. The value of the condo was:
Correct Answer: $187,500
(Calculation: $10,500 / 0.07 = $150,000 loan amount. $150,000 / 0.80 = $187,500 value)
- Adams, Brown, and Chow are owners of commercial land as joint tenants. Adams
dies and is survived by Brown and Chow. Which is correct?
Correct Answer: Adams's interest terminates.
- To completely fence the NW quarter of the SE quarter of Section 3 would take how
much fencing?
Correct Answer: 1 mile
- When the landlord and the tenant mutually agree to cancel a lease, their action is
called a(n):
Correct Answer: mutually agreed upon termination.
23. An amortized loan has equal monthly installments consisting of:
Correct Answer: principal and interest
- Which of the following is an operating expense to be subtracted from gross income
when appraising a property using the income approach?
Correct Answer: property taxes
25. The word emblements refers to:
Correct Answer: Growing Crops
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- A salesperson working for a broker had been wrongfully selling information to a
loan company. When the broker, who had been using reasonable supervision,
discovered this, the salesperson was fired. Based upon the information given:
Correct Answer: both the salesperson and the broker are liable
- Which of the following is worded incorrectly?
Correct Answer: Federal Housing Association (FHA)
- Williams entered into a nine-month oral lease on July 1 to start on September 1 at a
rate of $1,000 per month. On August 15, Williams backed out of the lease. The lease is:
Correct Answer: enforceable.
29. Title insurance does not protect a buyer against:
Correct Answer: zoning restrictions
30. If state housing codes conflict with local codes, usually:
Correct Answer: the stricter of the two prevails
- A broker received deposits from principals and incorrectly placed the funds in a
safe for several days before putting the funds in the broker's trust fund account at the
bank. The broker is guilty of:
Correct Answer: commingling.
- A husband dies intestate. His separate property is distributed to his wife and two
children as follows:
Correct Answer: one third to the wife, the rest to the children
- Under the Subdivided Lands Act, the Real Estate Commissioner is primarily
concerned with:
Correct Answer: financing and marketing arrangements
- Jones leases a home from Santos under a three-month written lease. Upon
expiration of the lease, Jones retains possession. Santos has not decided on the next
