Real Estate Practice Final – Flashcards
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1. Which feature below does not pertain to energy efficiency? a. Energy Star® appliances b. Increased insulation in walls and roof c. Efficient heating and cooling equipment d. Shag carpets and marble countertops
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d. Shag carpets and marble countertops
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2. What protects real estate owners from challenges to their property titles? a. Property insurance b. Title insurance c. Land insurance d. Escrow insurance
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b. Title insurance
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3. An interest-only loan offers borrowers greater purchasing power, increased cash flow and is a popular alternative to traditional: a. fixed rates loans. b. straight loans c. term loans. d. primary loans.
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a. fixed rates loans.
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4. The effective exchange of information is called: a. listening. b. communication. c. physical or verbal cues. d. understanding.
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b. communication.
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5. When must you disclose your agency relationship to the seller if the property is a residential property of one-to-four units? a. After holding an open house b. Prior to taking a listing agreement c. After escrow is complete d. After the buyers move into the new property
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b. Prior to taking a listing agreement
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6. What is another name for an offer to purchase? a. Escrow instructions b. Deposit receipt c. Unilateral contract d. Transaction record
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b. Deposit receipt
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7. Which segment of the industry do most licensees choose for employment? a. Loan brokerage b. Residential brokerage c. Transaction coordinator d. Property management
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b. Residential brokerage
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8. If the buyer backs out of the contract without good reason, the offer to purchase contains a printed clause that says the seller may keep the deposit as: a. equity. b. personal property. c. liquidated damages. d. commission.
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c. liquidated damages.
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9. A home's curb appeal is boosted by all of the following, except: a. mowing the lawn. b. planting colorful flowers. c. parking an expensive vehicle in the driveway. d. placing a new doormat outside the front door.
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c. parking an expensive vehicle in the driveway.
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10. According to the NAR Profile of Home Buyers and Sellers, what do buyers frequently use to search for homes? a. FSBO listings b. Internet c. Expired listings d. Newspaper advertising
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b. Internet
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11. To prepare a CMA for a property, collect data on at least ________ comparable properties that are as similar as possible to the property in question. a. two b. three c. five d. ten
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b. three
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12. What is the most difficult part about estimating the value of a property? a. Determining the condition of the market b. Understanding the seller's motivation c. Determining the condition of the home d. Determining the sales price of the home.
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c. Determining the condition of the home
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13. What is necessary for salespeople in order to thrive in today's ultra-competitive market? a. An unlimited advertising budget b. Broad-based marketing c. Target marketing d. Attractive yard signs
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c. Target marketing
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14. What should the sales associate do after the open house? a. Send the sellers flowers and a gift thanking them for their time. b. Call all the prospects who visited the open house. c. Leave the lights on and the doors unlocked. d. Throw the guest sign-in book away.
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b. Call all the prospects who visited the open house.
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15. Is the broker able to guarantee the performance of service providers? a. Yes b. No c. Only in extreme cases d. All of the above
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b. No
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16. Which activity is not something that salespeople perform in order to produce and maintain a consistent flow of business? a. Training and improving product knowledge b. Previewing properties and prospecting c. Obtaining listings, marketing properties, and working with buyers d. Ignoring market trends
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d. Ignoring market trends
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17. Before writing an offer for buyers, what should the salesperson keep in mind? a. What is the most the buyers will pay? b. Which is more important to the buyers— price or terms? c. Are the buyers prepared for a counteroffer from the sellers? d. All of the above
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d. All of the above
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18. As the business of buying and selling real estate becomes more complex, so do the: a. buyers and sellers. b. required disclosures. c. ordinances. d. brokerages.
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b. required disclosures.
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19. Which of the following is not part of the agency disclosure process? a. Disclose b. Elect c. Confirm d. Complete
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d. Complete
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20. In order to be valid, a goal must be: a. unreachable. b. unrealistic. c. intangible. d. measurable.
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d. measurable.
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21. A loan made by lenders without any governmental guarantees is called a: a. non-conforming loan. b. VA loan. c. creditor loan. d. conventional loan.
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d. conventional loan.
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22. When the sellers and buyers reach an agreement about the sale of the property, they: a. select a title company. b. cloud the title. c. order a chain of title. d. prepare closing statements.
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c. order a chain of title.
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23. Which of the following is not a time management tip that would be helpful for a sales associate? a. Prioritize activities b. Plan each day the night before c. Begin work at the same time each day d. Begin work at various times of the day
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d. Begin work at various times of the day
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24. Which roof is featured in Second Empire style and has nearly vertical sides with a flat top? a. Mansard b. Gable c. Hip d. Gambrel
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a. Mansard
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25. To divide or distribute expenses proportionately is to ____________ expenses. a. prorate b. extend c. plan d. record
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a. prorate
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26. The cost incurred when borrowing money is known as: a. security. b. term. c. interest. d. installment.
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c. interest.
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27. As a real estate salesperson, it is important to project: a. mediocrity. b. a negative demeanor. c. an erratic personality. d. a positive attitude.
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d. a positive attitude.
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28. The written employment contract between a broker and a seller is called: a. the listing agreement. b. dual Agency. c. the MLS. d. None of the above.
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a. the listing agreement.
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29. What is known as the reasonable effort to provide accurate and complete information about a property? a. Due diligence b. Safety clause c. Mirror offer d. Latent defect
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a. Due diligence
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30. In addition to their employing broker, the person who provides quality support, advice, and counseling to new licensees is known as a: a. psychologist. b. principal. c. mentor. d. salesperson.
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c. mentor.
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31. The first thing a new salesperson should create when beginning a real estate sales career is: a. a sphere of influence. b. a telemarketing list. c. a contact list. d. an auto dialer.
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c. a contact list.
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32. Susan is a new sales associate. What should she do to prepare for an open house? a. Wear professional attire. b. Park her vehicle away from the house. c. Visit the house prior to the open house. d. All of the above
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d. All of the above
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33. Which of the following are ways to advertise on the World Wide Web? a. Banner and sidebar ads b. Pop-ups c. Interstitial ads d. all of the above.
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d. all of the above.
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34. A detailed schedule that shows the seller everything you will do to market the property is called a: a. property profile. b. property marketing plan. c. sales comparison approach. d. time management plan.
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b. property marketing plan.
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35. When is a good time to present your commission to the seller? a. After the house has been sold b. While you are explaining the costs in the net sheet c. Before agency has been disclosed d. While you are working at an open house
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b. While you are explaining the costs in the net sheet
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36. What does it take to create interest in a property, causing it to sell at a top price? a. Consistent property marketing b. Irregular mailings over a period of at least six months c. Reducing the curb appeal of a property d. Individuality to attract potential buyers and sellers
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a. Consistent property marketing
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37. Which statement about buyers is true? a. Buyers do not have to work exclusively with one salesperson. b. Buyers choose their own real estate salesperson. c. Buyers may work with as many salespeople as they wish. d. All of the above
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d. All of the above
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38. What warns prospective buyers that certain "hazards may limit your ability to develop the real property, to obtain insurance, or to receive assistance after a disaster"? a. Listing agreement b. Transfer Disclosure Statement (TDS) c. Natural Hazard Disclosure Statement (NHD) d. Multiple Listing Service (MLS)
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c. Natural Hazard Disclosure Statement (NHD)
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39. What is the period of time called when all parties are held accountable for the terms of the agreement such as disclosures, financing, property inspection, title search, etc? a. Escrow b. Due diligence c. Closing d. Certification
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a. Escrow
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40. What statements define the terms of an agreement and give the other party cause to void an offer if the terms are not met? a. Contingencies b. Considerations c. Contract offers d. None of the above
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a. Contingencies
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41. In order to ensure future business after a closing, sales associates should: a. ask their clients if they are satisfied with the way the transaction was handled. b. send them a thank you note or gift. c. ask for referral business. d. do all of the above
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d. do all of the above
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42. A broker who obtains a listing from a seller to act as an agent for compensation is called a: a. selling agent. b. listing agent. c. subagent. d. third party.
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b. listing agent.
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43. As part of the ongoing expenses of being a sales associate, the first thing to do is set aside money for: a. federal and state income taxes. b. a new vehicle. c. the fastest computer available. d. the latest computer software.
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a. federal and state income taxes.
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44. A borrower who wants an FHA loan would apply directly to: a. the FHA. b. an FHA-approved lender. c. Both a and b d. Neither a nor b
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b. an FHA-approved lender.
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45. What is the first step in the closing process, usually done by the listing salesperson? a. Validating property ownership b. Ordering the preliminary title report c. Opening escrow d. Scheduling a home inspection
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c. Opening escrow
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46. What should you use as a guide when creating an action plan for real estate? a. Goals your friend successfully used. b. Your goals c. Goals taken from a popular time management magazine d. None of the above
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b. Your goals
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47. Overlapping horizontal boards made from wood, vinyl, or aluminum that are applied to the house are referred to as: a. adobe bricks. b. stucco. c. siding. d. shingles.
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c. siding.
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48. Which document is used to verify the legal ownership of property, show any liens against the property, and describe any easements or CC&Rs? a. Closing Statement b. Homeowners' Association Statement c. Preliminary Title Report d. Transfer Disclosure Statement
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c. Preliminary Title Report
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49. The security pledged for repayment of a loan is called: a. earnest money. b. collateral. c. principal. d. principle.
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b. collateral.
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50. Which insurance policy covers various claims for mistakes, neglect, or carelessness in the normal business activities of a real estate brokerage? a. Automobile insurance b. Errors and omissions insurance c. Homeowner's insurance d. Company insurance
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b. Errors and omissions insurance
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51. Which of the following protects the broker's commission? a. Safety clause b. Listing price. c. Mediation d. MLS
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a. Safety clause
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52. Laura is the salesperson at an open house. She notices one woman lingering in the home. What should Laura do? a. Tell the guest the open house is over and she needs to leave immediately. b. Follow the guest from room to room c. Ask the guest if she is interested in buying the home d. None of the above
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c. Ask the guest if she is interested in buying the home
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53. People commonly refer to a real estate firm as a real estate agency, but it is actually a(n): a. industry. b. competitor. c. brokerage. d. None of the above
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c. brokerage.
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54. An unsolicited email message from a real estate agent that offers the agent's services to recipients on a mailing list is a: a. commercial email message. b. transactional email message. c. direct contact email message. d. requested email message.
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a. commercial email message.
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55. Initially, sales associates should hold open houses in neighborhoods where they: a. know the market. b. have never lived. c. do not know the school system. d. do all of the above.
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a. know the market.
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56. What should a well-designed website include? a. Local points of interest b. Community pages c. City history d. All of the above
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d. All of the above
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57. Once the listing appointment is set, start preparing and gather the information needed to make a comprehensive: a. buyers' survey. b. bilateral contract. c. listing presentation. d. listing price.
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c. listing presentation.
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58. The first broker to obtain a buyer who meets the terms of the listing, and whose offer is accepted by the seller, earns the commission. What is that agent known as? a. The procuring cause of the sale b. A "ready, willing, and able" agent c. An arbitrator d. A dual agent
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a. The procuring cause of the sale
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59. One of the most important factors for customer satisfaction is: a. tolerance. b. communication. c. being easily recognizable. d. a buyer-seller meeting.
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b. communication.
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60. If the buyer is not working with the sales associate or broker exclusively, what must the selling agent (who may also be the listing agent) provide? a. A written disclosure regarding the agency relationship before the buyer makes an offer to purchase. b. A list of three possible choices of buyer representation c. Inspection timeframes and work orders d. All of the above
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a. A written disclosure regarding the agency relationship before the buyer makes an offer to purchase.
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61. What form is used to disclose the condition of the property? a. Transfer Disclosure Statement b. Agency Relationship Disclosure c. Multiple Listing Service d. Estimated Seller's Proceeds
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a. Transfer Disclosure Statement
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62. Most real estate agents earn commissions when transactions close. What is a commission? a. A fee based on a percentage of a property's sales price b. A fee calculated on the number of hours worked on the transaction c. A salary paid to independent contractors d. All of the above
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a. A fee based on a percentage of a property's sales price
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63. What statement is used to disclose facts about a particular piece of property that could materially affect the property's value and desirability? a. Home Inspection Statement b. Transfer Disclosure Statement c. Condition of Financing Disclosure d. Easement Statement
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b. Transfer Disclosure Statement
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64. Every single agency relationship has: a. a principle, an agent, and a subagent. b. a client, an agent, and a principal. c. a principal, a client, and a third party. d. a principal, an agent, and a third party.
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d. a principal, an agent, and a third party.
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65. You are the listing sales associate. Once the seller has accepted an offer, you should: a. be sure the buyer inspects the property the next day. b. wait for the selling sales associate to open escrow. c. help the seller meet all terms of the purchase contract in a timely manner. d. help the buyer fill out the loan application in order to obtain financing.
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c. help the seller meet all terms of the purchase contract in a timely manner.
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66. A group of people who are most likely to seek your services or purchase your product is a: a. median market. b. marketing mix. c. target market. d. mentor.
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c. target market.
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67. Typically, junior loans include: a. home equity loans. b. home equity lines of credit. c. seller financing. d. All of the above.
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d. All of the above.
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68. The process in a real estate transaction in which agreed-on costs are paid and legal title is transferred from seller to buyer in exchange for consideration is called: a. chain of title. b. financing. c. closing. d. caveat emptor.
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c. closing.
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69. What can you use to schedule all activities necessary to reach your goals? a. A goal setting sheet b. A career progress plan c. A time management plan d. An action plan
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c. A time management plan
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70. Which of the following housing styles has become one of the most common styles in the United States? a. Pueblo b. American Foursquare c. Queen Anne d. USonian
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b. American Foursquare
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71. How could a real estate sales associate best prepare for a listing appointment with a seller? a. Prepare a comparative market analysis b. Send the seller a pre-listing package c. Prepare a property marketing plan d. All of the above
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d. All of the above
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72. All counteroffers must be: a. in writing. b. verbal agreements. c. presented by an attorney. d. made after escrow closes.
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a. in writing.
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73. A realistic start-up budget for a real estate salesperson should include: a. convention expenses. b. only what is necessary to get started. c. dining and entertainment expenses. d. clothing accessories.
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b. only what is necessary to get started.
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74. You should advise the seller to prepare his or her home for sale by: a. paying for a lockbox. b. determining attorney's fees. c. scheduling a professional home inspection. d. setting up "For Sale" signs.
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c. scheduling a professional home inspection.
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75. If a buyer raises an objection about purchasing a home, what should a sales associate ask the buyer? a. "There must be a good reason for your hesitation. Do you mind if I ask what it is?" b. "What else do you need to move forward?" c. "In addition to that, is there any other reason for your hesitation?" d. All of the above
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d. All of the above
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76. Although this is the most efficient use of prospecting time, many salespeople resist: a. e-mailing. b. sending direct mail. c. putting flyers on car windshields. d. warm calling.
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d. warm calling.
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77. Which tip could be used to help you write an effective and appealing ad? a. Ask the present owner what he or she likes best about the home. b. Write the ad to target a specific audience (comfort or status) c. Both a and b d. Neither a nor b
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d. Neither a nor b
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78. Which of the following is an example of outdoor advertising? a. Classified ads b. A website c. Pop-up ads d. Yard signs
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d. Yard signs
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79. Real estate salesperson Chris obtained a listing from James. Chris found a "ready, willing, and able" buyer who met all terms of the listing and presented an offer to James. Which of the following statements is true? a. James must pay the promised commission directly to Chris. b. When escrow closes, James will pay the promised commission to Chris's broker. c. Both a and b d. Neither a nor b
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b. When escrow closes, James will pay the promised commission to Chris's broker.
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80. Which type of communication is important when servicing a listing? a. Personal visits b. Phone calls c. E-mail d. All of the above
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d. All of the above
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81. What is a form of online publication that allows end users to engage in conversations related to the content on a website? a. social media b. Warm calling c. Direct mail d. Telemarketing
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a. social media
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82. In a dual agency, the broker is the listing agent and the: a. listing agent. b. selling agent. c. subagent. d. buyer.
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b. selling agent.
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83. What should a licensee do if a seller asks questions regarding legal, tax, insurance, or title implications? a. Answer the questions willingly b. Do the necessary research and answer the questions c. Move on to a different subject d. Tell the seller to seek professional advice
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d. Tell the seller to seek professional advice
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84. Which of the following is not true regarding the use of the Internet in real estate transactions? a. Home sellers do not like the increased visual marketing and instant access b. Home sellers appreciate the increased visual marketing and instant access c. Many people in the business say the Internet complements the licensee's role d. The Internet is something that has been used extensively the past few years
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a. Home sellers do not like the increased visual marketing and instant access
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85. An offer is not a binding contract between a buyer and a seller until: a. it has been rejected by the seller and the buyers have been notified. b. the sellers sign it and the buyers have been notified of the sellers' acceptance. c. the salesperson's broker initials, and dates it. d. the buyers revoke their offer.
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b. the sellers sign it and the buyers have been notified of the sellers' acceptance.
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86. As a salesperson, what is the goal of an initial meeting with a buyer? a. To learn as much as possible about the buyer's needs. b. Have five appointments ready to show the buyer c. To insist that you are the perfect salesperson to work with the buyer. d. To find a property for the buyer
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a. To learn as much as possible about the buyer's needs.
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87. Which housing style displeases some critics because of its mix and match look that they say is oversized, pretentious, and without style? a. Neo-Eclectic b. Shed c. Bungalow d. Contemporary
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a. Neo-Eclectic
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88. What marketing piece identifies a salesperson's credentials and successes? a. Time management plan b. Action plan c. Career book d. Task list
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c. Career book
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89. The process of evaluating a borrower's risk factors before a lender makes a loan is known as: a. approving. b. underwriting. c. processing. d. All of the above.
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b. underwriting.
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90. If you fail to make your monthly payment, a lender may take ownership of your home using which legal process? a. Foreclosure b. Amortization c. Repossession d. Contract of sale
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a. Foreclosure
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91. What is the purpose of analyzing market activities and creating an income funnel? a. To determine the colors to use on a website b. To determine if a marketing plan is effective c. To calculate expenses for taxes and insurance d. How many schools and hospitals are in your neighborhood
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b. To determine if a marketing plan is effective
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92. What is a characteristic of the A-Frame style? a. It is ideal for warm climates b. The roof is flat c. It is not ideal for areas that receive snow d. It is ideal for cold, snowy regions
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d. It is ideal for cold, snowy regions
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93. Of the following, what should a sales associate do to present a winning and professional listing presentation? a. Bring a net sheet, cover letter, and advertising samples b. Set the price and give it to the seller c. Leave all listing forms at the office d. All of the above
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a. Bring a net sheet, cover letter, and advertising samples
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94. Ideally, the most effective way to present an offer is: a. over the phone. b. by fax or email. c. in person. d. All of the above
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c. in person.
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95. When selling a 10-year old unit in a common interest development such as condominiums, stock cooperatives, or planned developments, which form must be used? a. Lead-based paint disclosure. b. Residential HOA Agreement c. Homeowner's Guide to Condominium Living d. Homeowner Association Information Request
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d. Homeowner Association Information Request
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96. Which firms are usually owned by private parties or partnerships, and may have many offices in one area? a. Franchises b. Small independent firms c. Large independent firms d. Outlets
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c. Large independent firms
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97. What could a well-prepared salesperson use to qualify a buyer? a. A buyer's profile b. A scorecard c. Loan agents d. Buying signs
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a. A buyer's profile
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98. First impressions are crucial to building a strong relationship between a sales associate and a prospect. Good first impressions are created by: a. speaking clearly with a "smile" in your voice. b. being enthusiastic, sincere, and respectful. c. being empathetic and apologetic if the prospect raises any concerns. d. doing all of the above.
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d. doing all of the above.
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99. What is similar to an office preview, but is open to all members of the MLS? a. An online listing b. A caravan c. A virtual tour d. An open house
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b. A caravan
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100. Using radio and television as advertising methods can be: a. used for generating leads, but not for developing brand recognition. b. useful only for generating leads. c. relatively inexpensive. d. very expensive.
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d. very expensive.
