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Modern Real Estate Practice in Pennsylvania 12th Edition

Real Estate Fundamentals Exam
1. The phrase “bundle of legal rights” is properly included in a. the definition of real property. b. a legal description. c. real estate transactions. d. leases for less than one year. Land is considered a. indestructible. b. a depreciating asset. c. immune to the forces of supply and demand. d. subject to personal property rights. An owner leases store space to a tenant to operate a restaurant. The tenant has installed ovens, booths, counters, and other equipment. When would these items become real property? a. Provided the items are permanently attached, they become real property at the time of annexation. b. If the tenant defaults on a rental payment, the items become the real property of the landlord if the default is not cured within 30 days. c. The items become real property as soon as the tenant receives permission to install them. d. The items do not become real property, and they remain the tenant’s personal property. A bill of sale is used to transfer ownership of a. real property. b. fixtures. c. personal property. d. appurtenances. Which is considered an indefeasible fee? a. Fee simple on condition b. Fee simple determinable c. Fee simple d. Life estate pur autre vie In Pennsylvania, mine subsidence refers to a. leasehold rights b. air rights c. surface rights d. subsurface rights

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12. as a tenant in common with his partner’s heirs. cooperative. A person who owns one unit in a multiunit structure together with a specified undivided interest in the common elements owns a a. The interest that the man has in the property is a a. b. in absolute ownership under the law of descent. Principal meridians 8. d. d. condominium. Two people own a building as joint tenants with right of survivorship.Modern Real Estate Practice in Pennsylvania 12th Edition 7. d. time-share interest. Lots and blocks map d. curtesy estate. b. legal life estate. A license A man conveys ownership of his house to his mother and stipulates that upon her death. An easement in gross b. reversion estate. Two partners bought a store building. c. in severalty. Point of beginning b. remainder estate. An easement by necessity d. What type of access rights should she give prospective lot purchasers? a. Which is characteristic of a metes-and-bounds legal description? a. . The other now owns the building a. The owner of 50 acres of land with 500 feet of frontage on a desirable recreational lake wishes to subdivide the parcel into salable lots. c. in trust. 9. c. as a joint tenant with right of survivorship. b. Townships c. The other partner now owns the store a. share in a real estate investment trust. in severalty. ©2012 Kaplan Inc. c. as a joint tenant with rights of survivorship. d. An appurtenant easement c. One of the owners dies intestate. 10. he will recapture ownership. b. 11. She wants to retain control over the lake frontage while allowing lot owners to have access to the lake. taking title as joint tenants. One partner died testate. subject to the terms of the deceased’s will.

18. Special warranty deed b. d. an attachment. how is lien priority determined? a. deed of release. 16. d. Quitclaim deed d. General warranty deed A mechanic’s lien is properly classified as a. c. d. b. the trustee is required to sell the real estate the trust holds. The date on which the lien was recorded determines priority c. The date on which the debt was incurred determines priority d. A mechanic’s lien is always first in priority b. A mechanic’s lien for work started two months before the mortgage was recorded In general. metes and bounds. Sheriff’s deed c. A broker’s lien is automatically first in priority Under the terms of a trust established by a will. After a borrower defaults on mortgage payments. 19. All of the following are considered acceptable as legal identification of land EXCEPT a. a specific lien. trustor’s deed. a general lien. 14. ©2012 Kaplan Inc. d. an encumbrance. street address. c. A real estate tax lien for the current year c. b. a foreclosure. c. a seizure. an equitable lien. b. An outstanding first mortgage lien dated and recorded one year ago b. c. The deed that will be delivered at settlement of such a sale is a a. This action is an example of a. 15. government survey. 17. Which lien has highest priority? a. trustee’s deed. a voluntary lien. warranty deed.Modern Real Estate Practice in Pennsylvania 12th Edition 13. b. A judgment lien rendered and recorded last month d. reference to a plat filed in the country clerk’s office. a court orders real estate sold to satisfy the unpaid lien. . A title search revealed several outstanding liens against a property. Which deed provides the greatest protection from the seller to the purchaser of a property? a.

23. 21. d. Upon receipt of the deed. 25. The seller conveyed a quitclaim deed to the buyer. the buyer now owns the property subject to certain claims of the seller.Modern Real Estate Practice in Pennsylvania 12th Edition 20. the contract is immediately void. was the devisee. trust deed. c. 22. Trust deed b. died testate. A deed that has covenants of quiet enjoyment and further assurances is a a. there are no encumbrances against the property. Affidavit Generally. Quitclaim deed c. Special warranty deed Which is acceptable evidence of marketable title? a. d. b. d. This person a. warranty deed. b. if some defect in the title to real property is found by the preliminary title search. the buyer has a reasonable time to find another property. 24. d. . was the grantee. b. the buyer may be certain that a. the probate court determined the distribution of the land in accordance with the state’s statutes. ©2012 Kaplan Inc. Subsequent to the owner’s death. c. b. a new contract must be written. the seller owned the property. the seller has a reasonable time to correct the defect. died intestate. A grantor does not wish to be responsible for defects in the title that arise from previous owners but will guarantee the title for the time the grantor had ownership. Reconveyance deed d. A single person owned a parcel of land. the effect on a sales contract is that a. Bargain and sale deed b. special warranty deed. Title insurance policy d. c. c. Warranty deed c. What type of deed would the grantor convey? a. the seller has no further interest in the property. bargain and sale deed.

The lender charged two discount points on the loan. 30. a loan origination fee. 31. $49. judgment clause. forfeiture clause. Acceleration d. Deficiency b. What clause can the lender include in the note to prevent the loan from being assumed with the current low interest? a. a prepayment of mortgage insurance. c. ©2012 Kaplan Inc. The fee charged by a mortgage broker to arrange a loan is a. an advance interest payment. d. for the highest amount. What type of mortgage loan requires equal payments for 30 years. . a prepayment penalty. c. c. how much cash did the buyer need to cover the expenses of the down payment and the discount points? a. d. The buyer obtained an 80 percent loan-to-value (LTV) loan for the balance of the purchase price. escalator clause. Alienation 27. $184. acceleration clause. Fully amortized loan d. $25. b.000 In absence of an agreement to the contrary. the mortgage having priority will be the one a. The buyer put 10 percent of the purchase price in an escrow account and promised to bring another 10 percent in cash to the closing. $3. d. that is a construction loan. Straight loan b. recorded first.070 c. A property sold for $230. b. 29.680 b. b. Defeasance c.680 d. signed first. Straight-line amortized loan A lender is concerned that interest rates will rise in the future. Adjustable-rate mortgage c.000.Modern Real Estate Practice in Pennsylvania 12th Edition 26. 28. Including the earnest money deposit. at which time both the principal and the interest will be fully satisfied? a. The clause in a trust deed or mortgage that permits the lender to declare the entire unpaid balance immediately due and payable upon default is the a.

Asking price A tire company has a manufacturing plant located in an area that has just been rezoned for residential use. who really want this particular home. 36. The sellers decided that they did not wish to sell after they entered into a contract with buyers. Contact the municipality for relief d. Residential salesperson for loss of commission when the buyer used another licensee b. Go to court in an attempt to obtain injunctive relief c. However. the tire company MOST likely a. 33. Residential broker for advertising costs when the seller cancelled the listing before the property was sold c. can be done to enforce the deed restriction? a.Modern Real Estate Practice in Pennsylvania 12th Edition 32. c. 35. Commercial broker for payment of services rendered d. File a nuisance suit with the town’s planning commission What is the official value of real estate used for tax purposes? a. if the plant is destroyed by fire or other hazard. if anything. No option is available Who may file a lien against real property for payment of services rendered? a. Suit for specific damages b. d. ©2012 Kaplan Inc. What. including this set-aside space. What option is available to the buyers? a. because individual homeowners have no authority in this matter b. could rebuild the plant in that neighborhood by applying for a zoning variance. a deed restriction covering all the properties set aside the back six feet of each parcel as a combination green belt area and bicycle path. Commercial salesperson licensee for commission payment when the broker refused to share the listing commission When a subdivision was developed. could construct another plant without the residents’ consent as long as the homeowners’ association approves it. Appraised value d. Assessed value c. The company is allowed to continue operating the plant under the new zoning classification. Market price b. Suit for specific performance c. could construct another plant by obtaining the consent of the residents then living in the neighborhood. . 34. Nothing. into an organic garden. Suit for breach of contract d. would be forbidden to rebuild the plant in that neighborhood under any circumstances. A property owner has converted the back one-half of his yard. b.

variance. c. d. A method of sealing off disintegrating asbestos is called a. licensed auctioneers. b. issue licenses. d. capping. paint must be removed from surfaces before selling. b. ©2012 Kaplan Inc. promulgate rules and regulations. 40. b. c. An owner wants to erect a nine-foot-high revolving sign on the roof of his store. eminent domain. conduct licensing examinations. homeowners test for its presence. d. d. the Department of Housing and Urban Development (HUD) requires that a. landlords. escheat. 41. In regulations regarding lead-based paint. the owner must get a a. . c. d.Modern Real Estate Practice in Pennsylvania 12th Edition 37. appoint commissioners. encapsulation. b. safeguard all real estate licensees. contamination closure. confiscation. The Real Estate Commission conducts its activities to a. only HUD-licensed contractors may deal with its removal. c. d. 39. campground membership salespeople. satisfy the legislature. In order to do this legally. Under an existing ordinance. b. deed to the air rights. attorneys-in-fact. containment. nonconforming use permit. assist the commissioner of Professional and Occupational Affairs. known paint hazards must be disclosed. The Commission has the authority to a. protect the public interest. no signs that extend more than three feet above the highest point of a roof may be placed on any building. court order. c. 38. The condemnation of private property for public use is allowed under the state’s right of a. 43. The Commission has authority to take disciplinary action against a. 42. d. c. b. police power. c. b.

be a high school graduate. Assess the salesperson a criminal penalty of $500 c. Conducting title searches c. b. two months of the current rent. are required for a salesperson licensee to qualify for a broker’s license? a. The license is issued to the salesperson and can be taken to any broker of the salesperson’s choice. Tell the owner to file a complaint with a local real estate board How many years of active licensure. Attending closings b. c. b. 45. pass an examination. an individual must do all of the following EXCEPT a. The salesperson cannot use the license until completion of the broker’s training program. c. 47. Training builder-owner salespersons d. be at least 18 years of age. At least two years and age 21 upon application c. but the broker applicant must be 21 A broker is responsible for which activity? a. What action can the Commission take if a salesperson advertises a property for sale without the owner’s permission? a. two months of original rent. 46. Award the owner damages from the Recovery Fund b. d. Business that is conducted in branch offices To be eligible for a salesperson’s license. one month of original rent. The broker must display the license in the broker’s main office. ©2012 Kaplan Inc.Modern Real Estate Practice in Pennsylvania 12th Edition 44. At least three years of active licensure b. . c. 48. Five years of active licensure d. If a residential tenant rents a property from a landlord for three years. No specific number of years of active licensure. Suspend the salesperson’s license d. one month of the current rent. b. the maximum amount of security deposit the landlord may require from the tenant in the third year is a. 49. if any. Which is TRUE about a salesperson’s license? a. obtain 60 hours of education. d. The broker must display the license in the office where the salesperson works. d.

The purpose of the Recovery Fund is to enable a. If the broker has been in business for more than 25 years. Employees of a public utility acting in the ordinary course of utility-related business A broker’s license will expire at the end of May. 55. complete not less than 30 days of on-site training. The broker can continue to practice for 60 days after June 1 before renewing the license. Which is TRUE as of June 1? a. people to receive payment of uncollected judgments against licensees. When a property is advertised for sale by a salesperson. b. what information must be included in the ad? a. licensees to recover commissions that their brokers have failed to pay. b. and the broker must cease practice on June 1 if the broker fails to renew it. A broker can be subject to disciplinary action if a salesperson is found guilty of misconduct a. Phone number of the salesperson b. Business name of the broker c. b. sellers to recover money when buyers default on sales agreements. be at least 21 years of age. even if the broker was not aware of the salesperson’s action and had a policy against the actions the salesperson took. 53. if the broker directed the illegal course of action. complete 30 hours of instruction.Modern Real Estate Practice in Pennsylvania 12th Edition 50. d. The broker can renew the license as of June 1 and complete the continuing education courses within the following two years. c. Address of the broker d. the broker can renew the license as of June 1 without taking continuing education courses. Owners who are renting their own property c. An attorney-in-fact who is assisting in the liquidation of a decedent’s estate b. d. pass an examination. ©2012 Kaplan Inc. The license will be inactive. d. 52. 51. 54. when the Commission files a complaint against the broker. c. . Name of the salesperson Who must first obtain a real estate license before conducting real estate activities? a. d. c. sellers to recover escrow money that brokers have handled improperly. c. b. To obtain a salesperson license. only if the salesperson is licensed. a person must a. Individual renting a neighbor’s home while the neighbor is working overseas d.