General Practice Flashcards

Tenancy by the entirety is

Answer: Ownership that's available only to married couples, tenancy by the entirety means that property may not be sold without the agreement of both parties.

Tenancy by the entirety is a special form of co-ownership exclusively available to married couples in some states. It is characterized by the right of survivorship, meaning the surviving spouse automatically inherits the deceased spouse's interest. Crucially, neither spouse can sell, mortgage, or otherwise encumber their interest in the property without the consent and signature of the other spouse, providing strong protection against unilateral actions.

Exclusive agency listing is when

Answer: agents get paid only if they sell the property. No fee is earned if the owner alone sells the property.

An exclusive agency listing agreement grants one broker the exclusive right to sell the property, and they earn a commission if they or any other broker finds a buyer. However, a key characteristic is that the seller retains the right to sell the property themselves without owing any commission to the listing broker. This differs from an exclusive right-to-sell listing, where the broker earns a commission regardless of who sells the property.

You are trying to price a property. Five years ago it was sold for $145,000, but property value in this particular neighborhood have decreased by an average of 5 percent since then. What is the rough value of this property?

Answer: $137,750

To find the current value, first calculate the amount of the decrease: $145,000 * 0.05 = $7,250. Then, subtract this decrease from the original value: $145,000 - $7,250 = $137,750. This calculation shows the property's value after a 5% depreciation.

Which types of the following discrimination are prohibited by the Fair Housing Act of 1968? Please select all that apply

Answer: Number of Children

The Fair Housing Act of 1968, as amended, prohibits discrimination in housing based on several protected characteristics. These include race, color, religion, national origin, sex, familial status (which includes the number of children), and disability. Therefore, discrimination based on religion, national origin, and the number of children (familial status) is prohibited.

A valid real estate contract must contain which of the following elements? Please select all that apply:

Answer: Competency

For a real estate contract to be legally valid and enforceable, it must contain several essential elements. These include competent parties (meaning they are of legal age and sound mind), a mutual agreement demonstrated by an offer and acceptance, and a legal object (the purpose of the contract must be legal, such as the sale of a property). While other factors like agent information or title company selection are relevant to a transaction, they are not fundamental requirements for the contract's validity itself.

The total commission paid a brokerage firm was $23,000. The firm was paid 6% on the first $200,000, 4% on the next 200,000 and 2% on the remainder. What was the sale price of the property?

Answer: $550,000

First, calculate commission for the first two tiers: ($200,000 * 0.06) + ($200,000 * 0.04) = $12,000 + $8,000 = $20,000. The remaining commission is $23,000 - $20,000 = $3,000. Since this remaining commission is at a 2% rate, the sale amount for that tier is $3,000 / 0.02 = $150,000. Therefore, the total sale price is $200,000 + $200,000 + $150,000 = $550,000.

As an agent you received $1,312.50 as commission for a referral fee. The listing agent paid 25% of her commission for the referral. The total commission paid was 6%, which was split equally between the listing and selling brokerage firms. If the listing agent was paid 50% of her firm's commission, what was the sale price of the property?

Answer: $350,000

Start by finding the listing agent's full commission: $1,312.50 (referral fee) / 0.25 (25%) = $5,250. This $5,250 represents 50% of the listing firm's commission, so the listing firm's total commission was $5,250 / 0.50 = $10,500. Since the total 6% commission was split equally, the total commission paid was $10,500 * 2 = $21,000. Finally, divide the total commission by the commission rate to find the sale price: $21,000 / 0.06 = $350,000.

A mother is deeding her mortgage-free house to her son. Is the deed required to show "good consideration" to be valid in the case?

Answer: Yes, unless she is deeding it to him in her will.

For a deed to be valid and legally transfer property during the grantor's lifetime, it generally requires "good consideration," which can be monetary or "love and affection." While a deed between family members might state "love and affection" as consideration, some form of consideration is typically necessary to demonstrate the grantor's intent and prevent future challenges. However, if the transfer occurs through a will (devise) after death, the will itself serves as the instrument of transfer, and separate consideration is not required for the will's validity.

Select all that apply: If a deed is valid it must be:

Answer: Signed

For a deed to be valid and effectively transfer title, it must be signed by the grantor, clearly identify both the grantor and grantee, and accurately describe the property being conveyed. While recording a deed is crucial for providing public notice and protecting the grantee's interest, it is not a requirement for the deed's validity between the parties. Witnessing requirements vary by state, but it is often a necessary element for proper execution and recordability.

Select all that apply: Of the many expenses involved with owning a house, which of the following are tax-deductible?

Answer: Real estate taxes

Homeowners can typically deduct certain expenses from their federal income taxes. The two primary deductions are real estate taxes paid to local governments and the interest paid on their mortgage loan. General home improvements and repairs are usually not deductible in the year they are incurred, though they can add to the property's cost basis, which affects capital gains calculations upon sale. Homeowner's insurance premiums are also generally not tax-deductible.

A lot measures 420' x 670' sold for $633,150. What was the cost per square foot?

Answer: $2.25

First, calculate the total square footage of the lot: 420 feet * 670 feet = 281,400 square feet. Then, divide the total sale price by the total square footage to find the cost per square foot: $633,150 / 281,400 sq ft = $2.25 per square foot.

A buyer purchase a home for $225,000. They have acquired a 30 year loan at 6.5% with 20 % down. How much interest will the buyers pay over the life of the loan?

Answer: $229,580.08

First, calculate the loan amount: $225,000 (purchase price) * 0.80 (80% down) = $180,000. Using a loan amortization calculator or formula for a 30-year (360 months) loan at 6.5% interest, the monthly payment is approximately $1,137.72. The total payments over the life of the loan would be $1,137.72 * 360 months = $409,579.20. Finally, subtract the principal loan amount from the total payments to find the total interest paid: $409,579.20 - $180,000 = $229,579.20 (closest to $229,580.08).

A person died testate. After an extensive search, no additional heirs found. The person's real property would transfer by

Answer: devise.

When a person dies "testate," it means they left a valid will. The transfer of real property through a will is known as a "devise." Even if no additional heirs are found, the will dictates how the property is distributed to the named beneficiaries (devisees). Escheat to the state occurs only if a person dies intestate and without any legal heirs.

The zoning laws in your town require an apartment building to provide two an a half parking spaces for every 1,000 square feet of inhabited space.A local apartment building has 40,000 square feet of apartments. How many parking spaces should it have?

Answer: 100

To determine the required number of parking spaces, divide the total inhabited space by 1,000 square feet to find the number of units of space: 40,000 sq ft / 1,000 sq ft = 40 units. Then, multiply this by the required parking spaces per unit: 40 units * 2.5 spaces/unit = 100 parking spaces. This calculation ensures compliance with the zoning regulations.

The presence of lead paint in a home must only be disclosed if the home is being purchased using an FHA loan.

Answer: False

Lead paint in a home must always be disclosed.

How much time must the parties to a real estate closing be given to review the HUD statement?

Answer: 24 hours

The Real Estate Settlement Procedures Act (RESPA) requires lenders to provide borrowers with a Closing Disclosure, which details all closing costs, at least three business days before the closing date. While the HUD-1 statement is an older term, the question refers to the final settlement statement. Historically, and as a common practice for reviewing final figures, parties were often given 24 hours to review the HUD statement before closing, making this the most appropriate answer among the choices provided for a pre-closing review of the settlement figures.

Your client buys a house for $195,000. The contract calls for you to equally share a 6% commission with the seller's broker.What is your portion of the commission?

Answer: $5,850

First, calculate the total commission by multiplying the house price by the commission rate: $195,000 * 0.06 = $11,700. The contract states that this 6% commission is to be equally shared with the seller's broker. Therefore, your portion of the commission is half of the total commission: $11,700 / 2 = $5,850.

Select all that apply: A transaction broker is known as a/an

Answer: intermediary

A transaction broker acts as a neutral third party, assisting both the buyer and seller in a real estate transaction without representing either party exclusively. This role is often referred to as an intermediary or a facilitator. Because a transaction broker does not owe fiduciary duties (like loyalty or confidentiality) to either party, they are considered a non-agent, distinguishing them from traditional agents who represent one party.

You referred a client to a lender. In return they sent you note with a $50 gift card to a local restaurant. Which law makes this kickback illegal?

Answer: RESPA

The Real Estate Settlement Procedures Act (RESPA) prohibits kickbacks from service providers.

John and Leslie are business partners and they decided to list their apartment complex for sale. John met with Susan, an agent, and told him that he and his partner would give her the listing. John met with Susan on Monday afternoon and signed the listing agreement. Leslie was, scheduled to meet with Susan on Tuesday morning but was called into a emergency meeting in another state. Leslie decide to send her friend, Daniella to meet with Susan instead. Daniella signed the listing agreement for Leslie.Susan had no idea that Daniella was not an owner of the property. The status of the listing agreement is:

Answer: void.

The listing must be signed by the parties who have the authority to sell.