PSI Broker Exam Prep, Questions and answers, 2022/2023. Rated A

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PSI Broker Exam Prep, Questions and answers, 2022/2023. Rated A A buyer has the right to buy a property at an agreed-upon price within the next six months. This is a(n) - ✔✔an option A lea... sehold estate that does NOT require notice to terminate is called a(n) - ✔✔an estate for years The broker and the seller both know that the foundation of the seller's house is unsafe. If they do not inform the buyer of this condition, then the contract is - ✔✔voidable A contract that has been fully performed is - ✔✔Executed The broker and the seller are aware that the roof on the property leaks. Because no damage is visible and the buyer will have an inspection, they decide not to disclose the damage. This is an example of - ✔✔Fraud What does a suit to quiet title do? - ✔✔Resolves all clouds on a title Which of the following would convey an owner's interest in real property? - ✔✔Any deed A contract that conveys the right to quiet enjoyment and use of property but does NOT convey title is a - ✔✔a lease A suit for condemnation would be used to exercise which governmental right? - ✔✔Eminent Domain A lot that measures Which deed conveys title but has no covenants? - ✔✔Quitclaim Deed A standard title search would uncover - ✔✔deed restrictions A claim against another's property is known as - ✔✔An encumbrance Fee Simple Absolute Estate - ✔✔Last potentially forever and are the largest with the most rights and control over property Which parties must sign a deed to make it valid? - ✔✔The grantor only What is NOT essential for a valid deed? - ✔✔Deeds do not need to be recorded The covenant that warrants against claims of third parties is - ✔✔Covenant of quiet enjoyment Covenant of Seisin - ✔✔warrants that the grantor holds the interest to be conveyed Covenants against Encumbrances - ✔✔Warrant that property is free from unspecified encumbrances not mentioned in the deed If a buyer defaults in a purchase agreement and the seller keeps the buyer's earnest money, which remedy has the seller elected? - ✔✔Liquidated damages A leasehold estate with a definite expiration date that requires no notice is an - ✔✔Estate for years A plat map - ✔✔describes the lots and blocks in a subdivision A contract or agrrement that would give the seller the MOST flexibility - ✔✔First right of refusal Joint Tenants Must have - ✔✔PITT (Unity of Possession, Unity of Interest, Unity of Time, Unity of Title) Real Property Rights - ✔✔Land, Government, and Ownership A mortgage or deed of trust recorded against real property to secure the repayment of a debt is a - ✔✔Lien The broker and the seller are aware that the roof on the property leaks. Because no damage is visible and the buyer will have an inspection, they decide not to disclose the damage. This is - ✔✔Fraud (intentional deceit of material facts) An encroachment describes property that - ✔✔extends over adjoining lot lines A first mortgage is distinguished from a second mortgage by the - ✔✔date the mortgage was recorded The requirement that a structure be built at least 25 feet from the front lot line is a - ✔✔Setback Restriction Upon acceptance of a contract by the seller, the buyer has what kind of title to the property? - ✔✔Equitable A suit for condemnation would be used to exercise which governmental right? - ✔✔Eminent Domain How bog is an acre? - ✔✔43560 Feet A special Warranty Deed - ✔✔The grantor promises to defend the title against any encumbrances during the grantor's period of ownership Title is held by two people as joint tenants with the rights of survivorship. If one party dies, the deceased party's interest goes - ✔✔To the co-owner The tenant who remains in possession of real estate after the lease has expired and does so without the landlord's consent is - ✔✔A tenant at sufferance The principle of value that will determine whether or not a renovation is financially feasible - ✔✔contribution (if the increase in the value is more than the cost to renovate, the sellers would financially benefit from the renovation) Investing in Real Estate has the disadvantage of - ✔✔lack of liquidity An example of voluntary alienation is - ✔✔A deed Local zoning ordinances may NOT regulate - ✔✔market value of a property A buyer defaults on a purchase agreement and the seller goes to court to force the buyer to buy. The seller's remedy is - ✔✔Specific Performance Upon the death of a life tenant, the holder of the remainder estate will have which type of estate? - ✔✔Fee Simple Absolute Estate A lease in which a commercial tenant's rent amount stays the same for the term of the lease and the tenant pays only rent to the landlord is what type of lease? - ✔✔Gross Lease After a foreclosure proceeding, if the mortgagor owes the mortgagee more than what was received through the foreclosure, the mortgagee may file for a - ✔✔Deficiency Judgment The document that creates a lien and acts as security for the promissory not is a - ✔✔Deed of trust A seller who wants to be excluded from paying capital gains tax on a principal residence will need to - ✔✔Live in the home two out of 5 years Open listing - ✔✔Any broker can sell the property and get paid a commission if that broker is the procuring cause of the sale How would the buyer's earnest money deposit be entered on a closing statement? - ✔✔Credit to buyer only The seller told the listing broker that the seller's loan was assumable. Upon reviewing the seller's loan documents, the listing broker found that the mortgage was not assumable and that the seller would have to pay off the mortgage upon sale. What clause did the broker discover? - ✔✔Due-on-sale Clause Deeds do NOT guarantee - ✔✔Ownership What circumstances would terminate an offer on a residential property? - ✔✔Death of the offeror, revocation before acceptance, and a counteroffer from the seller The set of standards that governs appraisers is called - ✔✔USPAP (Uniform Standards of Professional Appraisal Practice) A method of property description using monuments, distances, and compass directions is the - ✔✔Metes-and-bounds Method On a buyer's closing statement, the buyer would typically be credited for - ✔✔Loans being assumed Which best describes capitalization rate? - ✔✔Rate of return an income property will produce A property owner has given a neighbor permission to park a camper in the owner's yard for a few weeks free of charge. The neighbor has a - ✔✔License An appraiser determining the accrued depreciation of a property is using which approach to value? - ✔✔Cost approach A buyer wants to obtain a loan that will allow regular payments of principal and interest for five years and then make a final balloon payment to pay off the remaining principal balance. This type of loan is known as - ✔✔Partially amortized loan Title insurance will cover title defects found - ✔✔after closing An agent owes a principal - ✔✔OLD CAR (obedience, loyalty, disclosure, confidentiality, accounting, and reasonable skill and care) A buyer purchased a home under a land contract. In this form od seller-carry lending, the seller - ✔✔holds the deed to the home until final payment A term loan is one in which - ✔✔the entire principal amount is due at the end of the term In a term straight loan - ✔✔the periodic payments are made on interest only. The entire original principal will come due at the end of the term of the loan A clause in a purchase agreement that would allow the buyer to cancel the contract if the buyer cannot secure financing from a lender is a - ✔✔contingency clause The document used to convey ownership to real property is a - ✔✔quitclaim deed A broker accepted a listing and later discovered that the client had been declared incompetent by a court. What is the current status of the listing? - ✔✔The listing is of no value to the broker because the contract is void To generate income, a property manager should - ✔✔Seek high-quality tenants RESPA requires borrowers be given which document within three days of loan application? - ✔✔Good-faith estimate, and the borrower must receive a HUD-1 settlement statement at closing Government Survey - ✔✔A system of legal description that uses meridian, baselines, townships, and sections When a seller deliberately deceives a buyer about the condition of real property, their contract of sale would be considered - ✔✔Voidable which best describes a capitalization rate? - ✔✔Rate of return an income property will produce An appraiser has been hired to prepare an appraisal report of a property for loan purposes. The property is an elegant old mansion that is now used as a restaurant. Which approach to value should the appraiser give the greatest weight when making this appraisal? - ✔✔Income A broker representing a landlord may properly refuse to rent to a prospective tenant because the prospective tenant - ✔✔Has a history of violence In the absence of a notice to terminate, a lease that continues automatically would be - ✔✔a periodic tenancy In order to increase the yield on a loan, the lender would charge - ✔✔Discount Points How will taxes paid in arrears show on the closing statement? - ✔✔Debit seller, credit buyer A deed would still be valid without - ✔✔a competent grantee Which federal law requires that finance charges be stated as an annual percentage rate (APR)? - ✔✔Truth in Lending Act (Regulation Z) Police Powers does not include - ✔✔Deed restrictions A landowner wishes to build a neighborhood grocery store on a busy street in an area zoned for residential use. Which would MOST likely be used ot obtain permission for this store? - ✔✔Conditional use permit or zoning variance. If conditions for property use are included in a deed and these conditions are violated, what is the most severe potential penalty? - ✔✔A court may order the return of the property to the original owner A formal appraisal will ALWAYS be required when the - ✔✔lender wants to sell the mortgage to the secondary market A couple owns an older home in a neighborhood that is becoming commercial area. Because of the change in the use of the land, the couple can expect the value of their parcel to increase at some future time. This is an example of - ✔✔Anticipation Evan if a loan applicant's current income seems adequate to qualify for a certain loan, the Equal Credit Opportunity Act allows a lender to refuse the loan as a high risk if the applicant's main source of income is - ✔✔Commission Sales When a home is purchased using and ARM, the monthly loan payment on the mortgage will - ✔✔Vary over the life of the loan depending on fluctuations in the interest rate to which the loan is referenced The FHA functions MOST like - ✔✔an insurance company In helping a buyer select a lender, if the buyer believes he has good credit and his income is documentable as a salary and by tax returns, the licensee might recommend a mortgage banker, instead of a mortgage broker, for all of the following reasons EXCEPT - ✔✔more variety of loan programs available In the sale of a property, there is often confusion over whether an item is a fixture or personal property. What is the best way to avoid confusion? - ✔✔Specify questionable items of property in the written sales contract A distinguishing characteristic of owning property by land trust is that - ✔✔The identity of the legal owner is kept confidential Legal descriptions using the government survey system are NOT generally used in - ✔✔The original 13 states [Show More]

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