WA Real Estate exam part 2 questions and answers 100% pass

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WA Real Estate exam part 2 questions and answers 100% pass At what point in a transaction must you disclose your agency status in writing? A. at closing B. When first meeting any potential party t... o the transaction C. Within 24 hours after a party signs an offer D. Before a party signs an offer ✔✔D. Before a party signs an offer A counteroffer: A. acts as a rejection of the current offer B. is used to rescind a previously existing contract C. is used to only to make an offer contingent on a particular event D. is used when a buyer wants to make an offer where the seller has already accepted an offer ✔✔A. acts as rejection of the current offer Which of the following practices would not be an illegal discrimination action? A. Always assigning minority buyers to work with minority agents B. Referring all Spanish-speaking buyers to Spanish-speaking colleagues C. referring a buyer to a spanish-speaking colleague after the buyer expressed a preference to work with a Spanish-speaking agent D. Failing to transmit an offer from an asian buyer to the seller of the property in an all-white neighborhood ✔✔C. referring a buyer to a spanish-speaking colleague after the buyer expressed a preference to work with a Spanish-speaking agent if a contingency is not fulfilled despite a good faith effort to fulfill it, what may the person who benefits from the contingency do? A. terminate the agreement and have the earnest money deposit returned B. waive the contingency and continue with the agreement C. Sue the other party for a breach of contract D. Either A or B ✔✔D. Either A or B Under which type of listing will the seller owe a commission to the listing agent regardless of who is the procuring cause of the sale? A. open listing b. exclusive agency c. exclusive right to sell d. net listing ✔✔C. exclusive right to sell under which type of listing will an agent receive a commission only if he is the procuring cause of the sale? A. open listing b. exclusive agency c. exclusive right to sell d. net listing ✔✔a. open listing all of the following should be taken into account in choosing a closing date, except: a. the due date of the next installment of property taxes b. how long the seller needs to make any necessary repairs c. whether the buyer needs to sell her current home d. the time needed to clear away any liens ✔✔a. the due date of the next installment of property taxes excise tax is usually paid by the: a. buyer b. seller c. lender d. borrower ✔✔b. seller which document should be prepared if the buyer plans to take possession before the closing date? a. rental agreement b. sale of buyer's home contingency c. bump notice d. backup offer ✔✔a. rental agreement a conventional loan can be: a. an ARM b. a 15-year loan c. a 30-year loan d. all of the above ✔✔d. all of the above Which party to a purchase and sale agreement usually benefits from a contingency? a. buyer b. seller c. designated broker d. second buyer ✔✔a. buyer all trust fund deposit of $10,000 or less that will be placed in a brokerage's account must be put in the: a. pooled trust account b. operations account c. designated broker's personal account d. trust account set up specifically for the inddividual client ✔✔a. pooled trust account which party is usually responsible for the cost of modifications or repairs made as a result of unsatisfactory inspection results? a. buyer b. seller c. listing agent d. none of the above ✔✔b. seller disclosure of and consent to a dual agency a. are not required in a transaction where both agents work for the same brokerage b. must occur only after the parties sign the purchase and sale agreement c. must be in writing d. allow the agent to promote the interest of one party over that of another party ✔✔c. must be in writing in a VA transaction, who pays the points? a. the buyer b. the seller c. as negotiated between the buyer and seller d. the government ✔✔c. as negotiated between the buyer and seller which of the following is the duration of a listing agreement in the state of Washington? a. 30 days b. 90 days c. 180 days d. whatever the agent and seller agree upon ✔✔d. whatever the agent and seller agree upon which of the following is a material fact that an agent would be required to disclose? a. the roof leaks during rainy weather b. the house was once the site of a suicide c. the house was once rented by gang members d. the house was once the headquarters for a doomsday cult ✔✔a. the roof leaks during the rainy weather which of the following statements in an advertisement is most clearly discriminatory? a. "close-knit asian neighborhood" b. "desirable and prestigious location" c. "neighborhood with traditional values" d. "safe neighborhood with hard-working people" ✔✔a. "close-knit asian neighborhood" all of the following should be included in every purchase and sale agreement, except: a. identification of the parties b. purchase price and method of payment c. agents commission d. dates when title and possession will pass to buyer ✔✔c. agent commission to determine an appropriate listing price for a property, an agent will perform a/an ___, which is related to but less rigorous than a/an ___. a. CMA/appraisal b. Appraisal/ CMA c. CMA/reconciliation d. Valuation/CMA ✔✔A. CMA/appraisal a large earnest money deposit a. guarantees the buyer's performance b. indicates the buyer's good faith in making an offer c. provides full compensation to the agent if the buyer defaults d. all of the above ✔✔b. indicates the buyer's good faith in making an offer for a property to be useful as a comparable, it should: a. be in the same neighborhood as the subject property b. be of a similar age and qualify as the subject property c. have sold within the last six months d. all of the above ✔✔d. all of the above which of the following is not usually a cost to the buyer? a. origination fee b. purchase price c. appraisal d. excise tax ✔✔d. excise tax the federal fair housing act prohibits discrimination on the basis of: a. race, religion, color, national origin b. mental/physical disability c. familial status d. all of the above ✔✔d. all of the above the Hutchinson own a house that is currently appraised at $545,000. They owe $397,000 on the deed of trust and would have $65,000 in selling expenses. What is their net equity in the property? a. 83,000 b. $148,000 c. $213,000 d. $480,000 ✔✔A. $83,000 which of these loans would present the greatest level of risk to a lender? a. 97% LTV b. 95% LTV c. 90% LTV d. 80% LTV ✔✔a. 97% LTV a dual agent must: a. disclose each party's negotiating position to the other party b. keep each party's negotiating position confidential c. act only as a a facilitator, with no agency duties to either party d. receive equal compensation from the two parties ✔✔b. keep each party's negotiating postion confidential fee parking, equity stripping, and ballon payment abuses are all examples of: a. preapproval techniques b. derogatory credit information c. rate lock-ins d. predatory lending practices ✔✔d. predatory lending practices In a request for a reconsideration of value, you should use: a. exactly the same comparables as the appraiser b. only currently listed properties as comparables c. comparable sales that are at least as similar to the subject property as as the appraiser's comparables d. the income approach to value ✔✔c. comparable sales that are at least as similar to the subject property as the appraiser's comparables the legal description in a purchase and sale agreement: a. is the street address of the property b. may be attached as addendum when lengthy, rather than appearing on the first page of the agreement form. c. should always include the lost size or acreage d. need not mention any personal property included in the sale, but only if the personal property was mentioned in the agreement ✔✔b. may be attached as a addendum when lengthy, rather than appearing on the first page of the agreement form A seller offers to pay six discount points on behalf of the buyers. This will reduce the buyers interest rate from 9% to 8%. This is known as a: a. lease/option b. seller second c. buydown d. two-step mortgage ✔✔c. buydown which of the following is not an important component of an inspection report? a. identify signs that the property may require a specialized type of inspection (such as environmental) b. projecting a future budget for repair or remodeling work c. providing an estimated valuation for the property d. summarizing areas that need or will need repairs ✔✔c. providing an estimated valuation for the property the seller disclosure statement should be filled out by the: a. seller b. seller's agent c. inspector d. any of the above ✔✔a. seller The cash price for a property and APR may be advertised. However, if other terms such as the downpayment or interest rate are stated in the ad, then: a. all the important terms of the loan must be included in the ad b. the APR is all that is necessary to include in the ad c. the lender's phone number must be included d. the ad violates the fair housing laws ✔✔a. all the important terms of the loan must be included in the ad which of the following would not be an adequate property description in a purchase and sale agreement? a. lot and block description b. street address c. attached photocopy of description from deed d. government survey description ✔✔b. street address which of the following is not a duty owed to every party in a transaction? a. reasonable care and skill b. honesty and good faith c. confidentiality d. present all written communications to either party in a timely manner ✔✔c. confidentiality once the buyer receives the seller disclosure statement, she may rescind the purchase and sale agreement within a. 3 days b. 4 days c. 5 days d. 7 days ✔✔A. 3 days Unless otherwise agreed, a licensee owns no duty to: a. conduct an independent investigation of the property b. conduct an independent investigation of either party's financial condition c. independently verify the accuracy or completeness of any statement made by either party d. all of the above ✔✔d. all of the above advertisements for residential property should always include: a. models of a different ethnic origin than the residents of the neighborhood you are advertising in b. models from the same ethnic group as the residents of the neighborhood you are advertising in c. the equal Housing Opportunity logo or slogan d. a specific explanation of the standards of the community ✔✔c. the equal housing opportunity logo or slogan all written offers must be: a. signed by the agent b. notarized c. presented to the seller d. all of the above ✔✔c. presented to the seller the licensee owes to all parties to whom the licensee renders real estate brokerage services the following duties: a. to exercise reasonable care and skill b. to deal in honesty and good faith c. to present all written offers d. all of the above ✔✔d. all of the above PMI is private mortgage insurance that protects the lender against financial loss in case of: a. fire b. water damage c. default by the borrower d. none of the above ✔✔c. default by the borrower when a listing agent transfers his affiliation to another brokerage: a. the agent automatically takes his listings with him b. that agents listings remain with the brokerage since the listing agreement is a contract between the seller and the firm c. the listing agent is entitled to a referral fee if the listing sells after the transfer d. none of the above ✔✔b. that agents listings remain with the brokerage, since the listing agreement is a contract between the seller and the firm It's a good idea to include calculation of the seller's estimated net proceeds in your competitive market analysis: a. to show the seller what the bottom line will be as a result of the sale b. to educate the seller that there are costs involved with the sale of a home c. because the license law specifically requires the use of net proceeds in CMAs D. both A and B ✔✔D. both A and B On a settlement statement, the debits represent: A. the amount of financing in the transaction b. money to be paid to the party c. costs that the party must pay at closing d. costs that the buyer must pay to the seller ✔✔c. costs that the party must pay at closing a bathroom contains a toilet, and a stand-up shower. This would be considered a: a. one quarter bath b. half bath c. three-quarter bath d. full bath ✔✔c. three-quarter bath In Washington, which type of listing must have a definite termination date? a. open listing b. exclusive agency c. exclusive right to sell d. none of the above ✔✔d. none of the above Before looking for a house, a potential buyer approaches a lender in order to obtain a promise of a loan up to a certain amount. This is known as: a. pre-qualification b. predetermination c. preapproval d. prepayment ✔✔c. pre-approval which of the following items is not a part of the escrow process? a. ordering a preliminary title report b. making a counteroffer c. paying off the remainder of the seller's loan d. recording mortgage documents ✔✔b. making a counteroffer what document does the escrow agent rely on in deciding how ti disburse funds? a. escrow instructions b. loan agreement c. listing agreement d. contingency addendum ✔✔a. escrow instructions the "included items" paragraph is used to: a. listing the documents being attached to the agreement b. determine how closing costs will be allocated c. specify which fixtures and/or personal property items will be part of the sale d. disclose the encumbrances on the property ✔✔c. specify which fixtures and/or personal property items will be part of the sale if a seller wants to help a prospective buyer qualify for an institutional loan, which of the following options will reduce the buyers interest rate? a. buydown b. equity exchange c. lease/option d. silent wrap ✔✔A. Buydown If a prospective buyer is adamantly opposed to an adjustable-rate or graduated payment mortgage, the agent should: a. condition the agreement upon the buyer's ability to obtain a fixed-rate loan b. explain that any reasonable person would accepts such financing c. represent to the buyer that interest rates have not increased in the past five years d. any of the above ✔✔a. condition the agreement upon the buyer's ability to obtain a fixed-rate loan pest inspections are usually required when: a. once every few years there is water in the basement b. there is sawdust-like material below parts of the foundations wooden structure c. the homes has a crawl space d. all of the above ✔✔b. there is sawdust-like material below parts of the foundations wooden structure which of the following will not be covered by a standard homeowner's hazard insurance policy? a. earthquake b. fire c. Vandalism d. Electrical overload ✔✔A. earthquake an agency relationship may be terminated by: a. notice from the agent b. notice from the principal c. mutual agreement d. any of the above ✔✔d. any of the above a listing agreement is a contract between the seller and: a. the licensee taking the listing b. the firm the licensee taking the listing works for c. the multiple listing service d. any of the above ✔✔b. the firm the licensee taking the listing works for any changes to a purchase and sale agreement must be approved and signed by the : a. seller and buyer b. seller, seller's agent, and buyer c. seller only d. buyer only ✔✔A. seller and buyer A principal is not liable for the act of an agent or subagent unless: a. the agent acted without authority b. the act had serious financial consequences for the principal c. the principal participated in an authorized the act d. none of the above ✔✔c. the principal participated in an authorized the act prior to acceptance, an offer may legally be terminated by a. the offeree b. the offeror c. the agent d. the seller ✔✔b. the offeror all of the following are characteristics of FHA insured loans, except: a. mortgage insurance premiums b. owner-occupancy requirement c. no downpayment d. more lenient underwriting standards ✔✔c. no downpayment If a seller does not want to sell to a member of protected class, agent should: a. take steps to accommodate the seller's wishes b. include this information in the Comments section of the listing c. explain the fair housing laws to the seller d. All of the above ✔✔c. explain the fair housing laws to the seller An agent representing the seller cannot disclose any confidential information from or about the seller: a. even after the representation ends b. unless it will not harm the seller c. either of the above d. unless instructed to by her designated broker ✔✔a. even after the representation ends when taking a listing, the agent should: a. let the seller know what to expect regarding open houses, signs, and the escrow process b. give instructions on preparing the house for sale c. explain how the keybox works d. all of the above ✔✔d. all of the above "APR" refers to: a. area property report b. annual percentage rate c. agency passing rate d. actual percentage rule ✔✔b. annual percentage rate potential environment hazards to be concerned with include: a. empty oil tank on property b. urea formaldehyde c. asbestos d. all of the above ✔✔d. all of the above which of the following is a method commonly used by agents to generate listings? a. cold calling b. referrals c. farming d. all of the above ✔✔d. all of the above TILA requires the lender to provide the buyer with an estimate of loan costs within: a. 2 days after the loan application is submitted b. 3 days after the loan application is submitted c. 5 days after the loan application is submitted d. 10 days after the loan application is submitted ✔✔b. 3 days after the loan application is submitted servicing the listing involves: a. obtaining keys and installing a lockbox b. advertising the property c. giving the seller weekly activity reports d. all of the above ✔✔d. all of the above which of the statements about an offer to purchase real estate is true? a. the offer must be in writing but the acceptance may be oral b. the offer need not be in writing but the acceptance must be written c. Both the offer and acceptance must be in writing d. neither the offer nor the acceptance need be in writing ✔✔c. both the offer and acceptance must be in writing Which of the following items is most likely to cause title to be unmarketable? a. Recorded CC&Rs b. adverse possession c. an encroachment that does not materially affect the property's value d. Reserved mineral rights ✔✔B. Adverse possession All of the following are necessary elements of a contingency, except: a. the deadline by which point the condition must be met or waived b. the rights of the parties if the condition isn't met or waived by the deadline c. a clear description of how the condition can be met d. the damages that the party unable to fulfill the contingency will pay the other party ✔✔d. the damages that the party unable to fulfill the contingency will pay the other party which of the following is not a step in preparing a competitive market analysis? a. using software to generate a list of suggested comparable properties b. selecting the comparable properties c. gathering information about the subject property's neighborhood d. Calculating the replacement cost of the subject property ✔✔d. Calculating the replacement cost of the subject property A homeowner preparing his home for sale should do all of the following except: a. fix any broker fences and railings b. reapaint interior walls in a bright primary color c. replace old, stained carpeting d. mow lawn and prune treees and shrubs ✔✔b. repaint interior walls in a bright primary color your buyers have found their dream home. the market is currently very active, and the home has already received two offers. the buyers want to make their offer more attractive, without increasing their risk or expense, so you recommend that they: a. include a personal statement with their offer b. waive all contingencies c. offer a smaller earnest money deposit d. all of the above ✔✔a. include a personal statement with their offer the amount of earnest money deposit: a. is always equal to 5% of the purchase price b. may never exceed $5,000 c. represents two months salary from the buyer d. depends on the circumstances ✔✔d. depends on the circumstances when a buyer is ready to make an offer, who may NOT prepare the offer? a. the buyer b. the buyers lawyer c. the buyers agent, writing the terms of the contract himself d. the buyers agent, using pre-printed purchase and sale agreement form ✔✔c. the buyers agent, writing the terms of the contract himself the law requiring a purchase and sale agreement to be in writing is the: a. statute of frauds b. license law c. federal Fair Housing Act D. RESPA ✔✔A. statute of frauds Which of the following responsibilities is NOT part of the duty of accounting? A. disclose the terms of the listing agent's compensation b. reporting to clients on the status of trust funds c. accounting for all money and valuables held by the brokerage on the client's behalf d. avoiding commingling trust funds and operating funds ✔✔a. disclosing the terms of the listing agent's compensation In order to diclose all material facts, a real estate licensee must: a. physically inspect the property b. disclose latent defects the licensee knows about c. actively search the material facts d. investigate both parties financial positions ✔✔b. disclose latent defects the licensee knows about A licensee who represents neither party in a transaction and acts as a neutral facilitator is a/an: a. dual agent b. subagent c. interagent d. non-agent ✔✔d. non-agent a typical listing agreement does NOT authorize the listing agent to: a. accept an offer to purchase the property b. submit offers to purchase the property c. accept earnest money deposits from prospective buyers on behalf of the seller d. act as the seller's agent ✔✔a. accept an offer to purchase the property which of the following would be considered a design deficiency, atleast in newer homes? a. more bathrooms than bedrooms b. kitchen too close to garage c. bedrooms not visible from living room d. there's no place in kitchen for casual eating ✔✔d. there's no place in the kitchen for casual eating Under federal law, the seller of a home built before 1978 must: a. remove all lead-based paint from the property b. have the home inspected for lead-based paint c. repaint any areas where lead-based paint was used d. provide a copy of any report about lead-based paint in the home to a prospective buyer ✔✔D. provide a copy of any report about lead-based pain in the home to a prospective buyer when choosing a home inspector, a buyer should look for a firm that: a. does other business in addition to inspections b. belongs to the American Society of Home Inspectors c. will offer to make the changes recommended by the inspection d. has recently changed its name ✔✔b. belongs to the American Society of Home Inspectors Subprime loans are made to borrowers who: a. want to make a smaller downpayment than prime lenders would allow b. have a very high debt-to-income ratio c. have poor or limited credit histories d. any of the above ✔✔d. any of the above A loan has an LTV of 90% if the: a. sales price is at least 90% of the value b. sales price is 90% of the value or less c. private mortgage insurance covers at least 90% of the loan amount d. ratio of the loan amount to the sales price (which matched the appraisal) is 90% ✔✔d. ratio of the loan amount to the sales price (which matched the appraisal) is 90% The required agency disclosure may be made either: a. orally or in writing b. in the listing agreement or in the purchase and sale agreement is signed c. before or after the purchase and sale agreement is signed d. in a separate paragraph in the purchase and sale or listing agreement or in a separate document ✔✔d. in a separate paragraph in the purchase and sale or listing agreement or in a separate document Which of the following is NOT a step in the inspection process? a. Ordering the inspection b. Approval or disapproval of the inspection report c. Appraisal of the property d. Reinspection of any required repairs ✔✔C. Appraisal of the property which of these closing expenses is customarily split evenly by the two parties? a. escrow fee b. Recording fees c. Attorney's fees d. appraisal fee ✔✔A. Escrow fee [Show More]

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