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BARNEY FLETCHER FINAL EXAM 2025 | QUESTIONS
AND CORRECT ANSWERS | LATEST VERSION |
VERIFIED ANSWERS | GRADED A+ | JUST RELEASED
Sam sold a property to Emma for $225,000. Sam's loan balance was $44,500 with an interest rate of 7%. Emma's conventional loan was at 8% with a 90% loan to value ratio. The taxes for the year were $1,250 and the home owner's insurance was $495. Closing took place on October 30th. Based on this information, answer the following question. How much was the accrued interest and to whom was it paid? A. lending institution $259. B. lending institution $256. C. Emma $17. D. Emma $268.23 ---------CORRECT ANSWER-----------------A. lending institution $259. $44,500 x 7% = $3,115 divided by 360 days = 8.6527 x 30 days = $259.5833 = $259. (accrued interest is paid for the due date through and including the day of closing) Which of the following would not be covered by RESPA? A. a VA loan for $55,000 first mortgage on a single family home B. an FHA loan for a first mortgage on a single family home C. a conventional loan for a first two family residence where the lender was insured by the FDIC D. a buyer assumed a $40,000 FHA insured first mortgage on a $50, single family residence ---------CORRECT ANSWER-----------------D. a buyer assumed a $40,000 FHA insured first mortgage on a $50,000 single family residence
Which best describes the difference between a fully amortized loan and a balloon note? A. a balloon note shows no decrease in the loan balance, whereas a fully amortized loan shows a decrease as the payments are made B. a balloon note includes a balloon payment on interest where a fully amortized loan does not C. a fully amortized loan extinguishes the loan in equal payments, whereas a partially amortized loan does not D. a balloon note extinguishes the loan in equal payments, whereas a fully amortized loan does not ---------CORRECT ANSWER-----------------C. a fully amortized loan extinguishes the loan in equal payments, whereas a partially amortized loan does not A seller wants to list the property with a broker, but wants to avoid paying any commission should the seller be fortunate enough to sell the property. himself. Which of the following should the seller avoid signing? A. an exclusive agency listing B. an exclusive right to sell listing C. an open listing D. all listings ---------CORRECT ANSWER-----------------B. an exclusive right to sell listing Mr. Smith listed his farm with broker Bob. Although Smith did not tell him, Bob knew he had to sell due to poor health. What should Bob tell potential buyers? A. tell them of the illness only if they ask, but not the need to sell B. tell them of the need to sell to insure a quick sale C. do not tell them even though it appears that Smith's death is imminent D. in order to sell quickly, tell them that the seller is ill because death would cancel the listing ---------CORRECT ANSWER-----------------C. do not tell them even though it appears that Smith's death is imminent
Smith has an exclusive listing with broker Jones for $220,000. Jones finds a buyer who wants representation and Jones represents both Smith and the buyer, verbally disclosing that he is now representing both as clients. Has Jones violated license law? A. yes, because this is sub agency B. yes, because this is undisclosed dual agency C. no, because he disclosed to all parties that neither had to consent to dual agency D. no, because he disclosed to all parties that his actions may be adverse to either party, however he would not divulge confidential information --------
- CORRECT ANSWER-----------------B. yes, because this is undisclosed dual agency A buyer and seller sign an agreement to change the contract to close on May 1 instead of May 2. This is a(n): A. addendum B. special stipulation C. amendment D. clause ---------CORRECT ANSWER-----------------C. amendment When a person, upon payment of a consideration, has an obligation to buy land at a fixed price within a specified period of time, his right could be described as: A. a right of first refusal B. an option C. a sales contract D. either A or B ---------CORRECT ANSWER-----------------C. a sales contract Joan has a listing with broker Bob. A week into the listing, Joan gets a call from broker Jill stating that the listing is now with her. Can this happen?
A. it's ok as long as it was assignable in the original contract B. it's ok as long as the brokers have a written contract between them to transfer C. never due to the statute of frauds D. it cannot be assigned because a listing contract is a personal services contract ---------CORRECT ANSWER-----------------D. it cannot be assigned because a listing contract is a personal services contract If all the principals live in the same city, in which of the following cases would the broker most likely need a power of attorney? A. the owner of a manufacturing plant lists it with a broker B. a buyer contracted with a broker to purchase all properties put up for sale in that county C. a couple going through a divorce lists their property with the broker D. the XYZ Corporation, through its Board of Directors, authorizes the broker to sell a piece of property owned by the corporation --------- CORRECT ANSWER-----------------B. a buyer contracted with a broker to purchase all properties put up for sale in that county An owner of a large estate told a broker he did not want an open house held on this property and wanted advertising in a national magazine only. Is this allowable? A. yes, the seller is responsible for planning all marketing of the property B. yes, the broker works for the seller and must follow all legal instructions of the seller C. no, the broker has the right to hold the house open at his own discretion D. no, the owner cannot limit the broker's ability to earn a commission ------- --CORRECT ANSWER-----------------B. yes, the broker works for the seller and must follow all legal instructions of the seller
When a salesperson is negotiating a listing contract, she learns that the seller has an assumable loan. Should she discuss with the seller ways to assist a buyer in financing the property? A. no, because if the seller's loan is assumed, the seller will always remain in a vulnerable position B. no, because financing part of the purchase price would place the seller in a vulnerable position C. yes, because every seller's equity in his/her property must be reduced to avoid capital gains taxes D. yes, because the seller's willingness to assist in the financing by allowing the loan to be assumed and possibly taking a second mortgage may make the property much more marketable, which would be to the seller's benefit ---------CORRECT ANSWER-----------------D. yes, because the seller's willingness to assist in the financing by allowing the loan to be assumed and possibly taking a second mortgage may make the property much more marketable, which would be to the seller's benefit A real estate salesperson intends to offer for sale a tract of land he inherited without listing it with a real estate brokerage company. Which of the following is NOT true concerning the marketing of this property? A. the salesperson must notify the broker in writing of his intention to sell the property B. in order to advertise the property, the salesperson must have his broker's written consent to do so C. in advertising the property, the advertisement must state, "owner is a licensed real estate agent acting as a principal D. the salesperson must offer the property through his broker's company. He may not advertise the property except as a listing of his company --------
- CORRECT ANSWER-----------------D. the salesperson must offer the property through his broker's company. He may not advertise the property except as a listing of his company
Most brokers will insert a protection clause in their listing contracts. This clause will usually allow: A. the listing of a house to automatically extend for an additional 30 days if the house is not sold during the agreed term or the listing B. a broker, who had procured a buyer before the expiration of the listing, to receive a commission even though negotiations were completed after the expiration date of the listing C. the listing agent has the first right of refusal in the event the house is not sold during the term of the listing D. none of the above are true ---------CORRECT ANSWER-----------------B. a broker, who had procured a buyer before the expiration of the listing, to receive a commission even though negotiations were completed after the expiration date of the listing Salesperson Dole was licensed under broker Carr but sold a property that was listed by broker Faulk. From whom would salesperson Dole collect a commission? A. broker Carr only B. broker Faulk only C. bother broker Carr and Faulk D. the owner of the property ---------CORRECT ANSWER-----------------A. broker Carr only Buyer Burke has authorized broker Rand to purchase a property on his behalf. What kind of agent is broker Rand? A. general agent B. special agent C. universal agent D. secret agent ---------CORRECT ANSWER-----------------B. special agent Which is the best example of functional obsolescence?
A loan in which the buyer pays off the total principal at the end of the loan is a: A. partially amortized B. straight term C. principal + interest D. amortized loan ---------CORRECT ANSWER-----------------B. straight term A lender would require a blanket mortgage in which of the following circumstances? A. if the borrower was going to use several unencumbered properties as security B. if there was a mortgage clause stating that upon default, it would become a general lien C. if the lender made the loan to encompass all of the borrower's debts D. none of the above ---------CORRECT ANSWER-----------------A. if the borrower was going to use several unencumbered properties as security Which loan will give a borrower the lowest monthly payment? A. 10% interest, 20 year term B. 10% interest, 25 year term C. 11% interest, 20 year term D. 11% interest, 25 year term ---------CORRECT ANSWER-----------------B. 10% interest, 25 year term Which factor would influence a lender LEAST in making a loan? A. the present value and future value of the property B. the income and income potential of the borrower C. the borrower's need of financial assistance D. the attractiveness of other investments ---------CORRECT ANSWER------ -----------C. the borrower's need of financial assistance
A homeowner with a mortgage replaced it with a new mortgage 3% lower in interest and obtained extra funds to make investments. This is called: A. subordination B. refinancing C. subrogation D. wraparound ---------CORRECT ANSWER-----------------B. refinancing In a repayment of a mortgage loan, which type of interest is used? A. simple B. discounting C. compound D. floating ---------CORRECT ANSWER-----------------A. simple When obtaining an FHA loan, which generally happens? A. an FHA approved appraiser appraises the property B. FHA makes the loans directly to the borrower C. the borrower makes the down payment directly to the FHA D. none of the above ---------CORRECT ANSWER-----------------A. an FHA approved appraiser appraises the property What does the VA require a veteran do when applying for a loan? A. make the down payment directly to the VA B. make a down payment in cash C. make the veteran assume liability for the loan D. NOT allow the veteran to make prepayments on the principal amount ---- -----CORRECT ANSWER-----------------C. make the veteran assume liability for the loan
A. intangibles taxes are not applicable to second mortgages, only to first mortgages B. any intangibles tax must be paid by the seller because the seller holds the mortgage C. any intangibles tax must be paid by the buyer because it was for the buyer's benefit that the loan was made D. either party can pay the intangibles tax ---------CORRECT ANSWER------ -----------D. either party can pay the intangibles tax When a property is being sold on an assumption of the existing loan, complications with the transfer of some mortgage loans can be: A. the purchaser may have to qualify with the lender as if it were a new loan B. the purchaser may have to pay a higher rate of interest C. the loan may be non assumable and due in full if the seller transfers ownership D. all of the above ---------CORRECT ANSWER-----------------D. all of the above The purpose of the earnest money is to: A. assure there is some valuable consideration B. help assure the purchaser's performance C. assure the seller's performance D. satisfy the Commissions requirements for sales contracts --------- CORRECT ANSWER-----------------B. help assure the purchaser's performance When a salesperson prepares an offer to purchase on a property listed with another real estate firm, he/she should recommend to the customer that the earnest money check be made payable to:
A. the selling salesperson B. the selling company C. the listing salesperson D. the listing company ---------CORRECT ANSWER-----------------D. the listing company If a purchaser tells a salesperson to hold the purchaser's earnest money check for 5 days before depositing it, the salesperson must: A. deposit the check in the broker's trust account as soon as practicable B. hold the check until the 5th day and then deliver it to her broker C. deliver the earnest money check to the broker as soon as practicably possible, with the purchaser's written instructions for the broker to hold the check D. tell the purchaser the check won't clear in less than 5 days --------- CORRECT ANSWER-----------------C. deliver the earnest money check to the broker as soon as practicably possible, with the purchaser's written instructions for the broker to hold the check In doing a market analysis, you find a recently sold property where the owners had just gone through a divorce. It was listed for $60,000 for 3 months but sold for $40,000. Would you use this as a comparable? A. no, because it had only been listed for 3 months B. no, because of the divorce, it was not an arms length agreement C. yes, you would use the actual sales price of $40, D. yes, because it was a comparable type property ---------CORRECT ANSWER-----------------B. no, because of the divorce, it was not an arms length agreement A property was worth $289,000 if capitalized at 4%. What is it worth if it capitalized at 5%?
Which of the following does NOT make loans? A. the secondary mortgage market B. the federal reserve C. savings and loans D. commercial banks ---------CORRECT ANSWER-----------------A. the secondary mortgage market What can the VA require a veteran do when applying for a loan? A. make the down payment directly to the VA B. make a down payment in cash C. make the veteran immediately assume liability for the VA guaranty amount D. NOT allow the veteran to make prepayments on the principal amount ---- -----CORRECT ANSWER-----------------C. make the veteran immediately assume liability for the VA guaranty amount Which of the following ways of advertising would be allowed under the Federal Truth In Lending Laws (Regulation Z)? A. $10,000 assumable loan in a working man's neighborhood B. shady acres - $10,000 down C. shady acres - guaranteed to double in value in 5 years D. shady acres - payments less than rent ---------CORRECT ANSWER------- ----------D. shady acres - payments less than rent A son and daughter in law wanted to buy their parents house and assume the mortgage. The son and daughter in law had just gone through bankruptcy. Which of the following clauses in a mortgage would prevent this sale and assumption from taking place? A. acceleration clause B. alienation clause
C. subordination clause D. defeasance clause ---------CORRECT ANSWER-----------------B. alienation clause Which non governmental organization has its greatest investment in first mortgages on single family residences? A. insurance companies B. commercial banks C. savings and loans D. federal housing administration ---------CORRECT ANSWER----------------- C. savings and loans Which of the following loans gives a borrower the lowest monthly payment? A. 8% interest, 20 year term B. 8% interest, 25 year term C. 9% interest, 20 year term D. 9% interest, 25 year term ---------CORRECT ANSWER-----------------B. 8% interest, 25 year term Which of the following would be enforced by the Federal Trade Commission (FTC)? A. federal real estate settlement procedures act (RESPA) B. federal fair housing (title VIII) C. federal equal credit opportunity act (FECOA) D. federal truth in lending law (Reg Z) ---------CORRECT ANSWER----------- ------D. federal truth in lending law (Reg Z) Under which of the following circumstances would one MOST likely see an estoppel certificate?
A. yes, because the broker produced a ready, willing, and able buyer B. yes, because the offer was reasonable C. no, because the broker did NOT produce a buyer that fulfilled all the terms of the listing agreement D. no, because the broker violated the listing agreement by writing a 100% cash offer ---------CORRECT ANSWER-----------------C. no, because the broker did NOT produce a buyer that fulfilled all the terms of the listing agreement A rental property manager's agreement allowed performance of normal maintenance and repairs. Which of the following acts would require the property manager to obtain the specific approval of the owner to do? A. fix a broken window B. repair the elevator C. renovate a unit for a tenant D. paint the outside trim ---------CORRECT ANSWER-----------------C. renovate a unit for a tenant When a property is sold, the transfer tax is: A. normally paid by the buyer B. normally paid by the seller C. considered to be part of the brokerage fee D. considered to be part of the mortgage loan fee ---------CORRECT ANSWER-----------------A. normally paid by the buyer A closing was to take place on June 15th. The sales price was $150,000. The seller's current loan balance was $115,000 with an 8% interest rate while the buyer was obtaining a 90% loan at 7%. The taxes of $600, paid in arrears, were to be prorated to closing with the seller being responsible for the closing date. What would be the amount of the tax proration? (use 30 day months and 360 day years)
A. $
B. $
C. $
D. $600 ---------CORRECT ANSWER-----------------A. $
$600 divided by 360 days x 165 days = $27 5 If a property sold for $3,000 per acre and the buyer bought 5 acres and one square mile, what was the total purchase price? A. $15, B. $1,920, C. $1,935, D. $2,500,000 ---------CORRECT ANSWER-----------------C. $1,935, one square mile is a section of ground which contains 640 acres. 640 + 5 = 645 total acres x $3,000 = $1,935, Lots were being sold in a subdivision that required all building lots contain a minimum of .5 acres. This would be an example of: A. down zoning B. deed restrictions C. directive zoning D. discriminatory pricing ---------CORRECT ANSWER-----------------B. deed restrictions A property had an area of 920 square yards with a 40 foot frontage. What was the depth of the lot? A. 23 feet B. 69 feet
