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DC REAL ESTATE EXAM PRACTICE TEST 150
QUESTIONS WITH 100% VERIFIED ANSWERS
GUARANTEED PASS!
"How long must property owners or property managers keep a copy of a signed DC lead disclosure form?
- CORRECT ANSWER=> 6 years"
"a property that the seller is selling for less than the seller owes against the property - CORRECT
ANSWER=> short sale"
"ownership has reverted to the lender because of a failed foreclosure sale or because of the property to
the lender through a deed in lieu of foreclosure - CORRECT ANSWER=> REO sale"
"calculated based on property's assessed value; government likes them because they are a stable,
reliable revenue source - CORRECT ANSWER=> property taxes"
"property transfer fees that are not included in the sales price - CORRECT ANSWER=> closing costs"
"closing costs (7) - CORRECT ANSWER=> 1. loan fees
- appraisal and survey fees
- title insurance
- legal fees
- RE commissions
- tax and insurance pre payments
- transfer fees"
"common seller credits (2) - CORRECT ANSWER=> 1. sale price of property
- prepaid taxes/utilities"
"common buyer credits (3) - CORRECT ANSWER=> 1. earnest money
- mortgage amount
- seller concessions"
"common seller debits (5) - CORRECT ANSWER=> 1. transfer taxes
- broker commission
- attorney's fees
- recording documents to clear title
- existing mortgage satisfaction"
"common buyer debits (6) - CORRECT ANSWER=> 1. appraisal and credit report fees
- inspection costs
- mortgage recording tax
- title insurance
- loan fees
- attorney's fees" "already paid by the seller but that the buyer should pay a portion of; CREDITED to seller and DEBITED to
buyer - CORRECT ANSWER=> prepaid expenses (ex: prepaid RE taxes, utilities paid in advance)"
"items the seller owes on closing day but that will eventually be paid by the buyer; DEBIT to seller and
CREDIT to buyer - CORRECT ANSWER=> accrued expenses (ex: unpaid property tax)"
"shared expenses that either party owes at closing (shared) - CORRECT ANSWER=> prorations (ex:
property taxes, HOA dues, fuel, water and sewer charges)"
"conveys real estate to a trustee for the beneficiary named in the trust agreement - CORRECT
ANSWER=> deed in trust"
"carries no warranties to the grantee; releases any of the grantor's property rights to the grantee; used
to clear up a simple cloud on title - CORRECT ANSWER=> quitclaim deed"
"grantor promises to protect and defend the title against lawful claims made by others - CORRECT
ANSWER=> covenant of warranty"
"grantor promises to take whatever actions necessary to correct any title defects - CORRECT
ANSWER=> covenant of further assurances"
"grantor assures that the grantee's use and enjoyment of the property will be unimpaired and
unrestricted - CORRECT ANSWER=> covenant of quiet enjoyment"
"the grantor assures the grantee that there are no encumbrances against the title other than those
identified in public records or the deed itself - CORRECT ANSWER=> covenant against encumbrances"
"the grantor has the right to convey both title to the possession of the property - CORRECT ANSWER=>
covenant of right to convey"
"the grantor holds title to and possession of the property - CORRECT ANSWER=> covenant of seisin"
"offers the greatest warranty to buyers and is the preferred type of deed in most situations - CORRECT
ANSWER=> general warranty deed"
"most common title defect in real estate - CORRECT ANSWER=> seller's existing mortgage lien"
"Licensee Enzo just received a letter from the DC commission with an invoice for $50 for the guaranty
and education fund. What must have happened to have triggered this request for funds? - CORRECT
ANSWER=> the fund dipped below a minimum balance amount"
"dual agency aka - CORRECT ANSWER=> dual representation"
"brokers from maryland and VA may be eligible for DC _____ licensing - CORRECT ANSWER=>
reciprocal" "uses planning, protection, and public education to promote stewardship of DC's historic properties -
CORRECT ANSWER=> historic preservation office"
"according to the DC Office of Human Rights, a possible penalty for violating fair housing law is_______ -
CORRECT ANSWER=> making the housing or loan available that has otherwise been denied to the
complainant"
"how many years does a home warranty cover structural damage? - CORRECT ANSWER=> 10 years"
"Act created an innocent landowner defense; determines liability - CORRECT ANSWER=> SARA"
"equal ownership with unity of time, title, interest, and possession - CORRECT ANSWER=> joint
tenancy"
"no down payment, no mortgage insurance, and no prepayment penalty - CORRECT ANSWER=> VA
loan" "mortgage that requires the borrower to pay interest for a set term then pay off the loan in a lump sum
or through another loan - CORRECT ANSWER=> straight term"
"capital gains fall into which stage of the property ownership life cycle? - CORRECT ANSWER=>
reversion"
"a document to transfer ownership/interest in real estate - CORRECT ANSWER=> deed"
"to provide consumers with better information about the true costs of credit and to protect them from
certain misleading practices by the lending industry - CORRECT ANSWER=> regulation z"
"why would buyers want to know whether a property is currently experiencing a tax abatement? -
CORRECT ANSWER=> their taxes are likely to increase when the abatement period ends"
"while improvements may deteriorate, land can't be destroyed - CORRECT ANSWER=>
indestructability"
"former owner - CORRECT ANSWER=> grantor"
"new owner - CORRECT ANSWER=> grantee"
"the lower-priced option of the two properties of equal quality will likely sell first - CORRECT
ANSWER=> substitution"
"maximum fine for a criminal proceeding - CORRECT ANSWER=> $10,000 (as well as up to 1 year in
prison)" "the escrow agent is required to deposit earnest money within _____ days after receiving it from the
buyer - CORRECT ANSWER=> 7"
"which of these tenants of a single-family property in DC would NOT be eligible to exercise TOPA rights? -
CORRECT ANSWER=> a disabled veteran who signed a lease on August 11, 2018 (by march 31,2018)"
"require a tenant vote - CORRECT ANSWER=> conversions"
"terms of service for someone appointed commissioner on the DC Commission of Human Rights? -
CORRECT ANSWER=> 3 years of service without compensation"
"1031 tax-deferred exchange ___ days must he close - CORRECT ANSWER=> 180"
"take priority over any and all other liens on the property in most states - CORRECT ANSWER=>
property tax liens"
"corporations/sole proprietors hold property this way - CORRECT ANSWER=> in severalty"
"what does CMA determine? - CORRECT ANSWER=> market price range"
"member-based cooperatives that provide credit for auto loans and home loans, and also take deposits
and offer things like savings vehicles and money markets - CORRECT ANSWER=> credit unions"
"provides you money for the loan/make loans using in-house loan processors and underwriters -
CORRECT ANSWER=> mortgage banker"
"match consumers with lenders (dont find loans) - CORRECT ANSWER=> mortgage broker"
"common range for loan origination fees - CORRECT ANSWER=> 1-3%"
"granted to a specific individual or company - CORRECT ANSWER=> easement in gross"
"which of the following statements about the number of contingencies in a sales contract is true? -
CORRECT ANSWER=> more contingencies makes buyer less likely to accept offer"
"closing disclosure not required - CORRECT ANSWER=> HELOC"
"each legal description in the rectangular government system originates at... - CORRECT ANSWER=>
the intersection of a principal meridian and a baseline"
"permits comparison shopping for loans - CORRECT ANSWER=> the loan estimate"
"a property that is being sold by the lender due to the buyer's default - CORRECT ANSWER=>
foreclousre"
"allows the lender to make the entire loan amount due immediately - CORRECT ANSWER=>
acceleration clause"
"conceal their identity behind someone else's name and credit - CORRECT ANSWER=> straw buyers"
"investor receives title to a property often by using a straw buyer; doesn't make the mortgage payments,
and usually rents out the home until foreclosure occurs - CORRECT ANSWER=> equity skimming"
"how many days before closing must you provide a closing disclosure? - CORRECT ANSWER=> 3"
"consumer protection statute designed to protect home buyers from unscrupulous lending and
settlement practices - CORRECT ANSWER=> RESPA"
"requires lenders to disclose credit terms and conditions when advertising triggers loan terms so as to
not mislead consumers - CORRECT ANSWER=> TILA"
"national banks that offer consumer and business loans for resale on the secondary mortgage market -
CORRECT ANSWER=> commercial banks"
"primary mortgage lender types (5) - CORRECT ANSWER=> 1. commercial banks
- credit unions
- savings and loan associations
- mortgage bankers
- mortgage brokers"
"gives the lender the right to declare the entire amount due - CORRECT ANSWER=> alienation (due-on-
sale clause)"
"when does the lender fund the loan? - CORRECT ANSWER=> when the seller has conveyed the
property"
"seller holds a mortgage that wraps the new buyer's mortgage around the seller's existing mortgage -
CORRECT ANSWER=> wrap-around mortgage"
"a loan a seller issues to the buyer as a part of the purchase transaction (used when a buyer cannot
qualify for a mortgage through traditional means) - CORRECT ANSWER=> purchase money mortgage"
"requires the buyer to make installment payments to the seller for property purchase - CORRECT
ANSWER=> land contract/contract for deed"
"temporary or short-term loan that provides funds until buyers can obtain permanent financing -
CORRECT ANSWER=> bridge/swing loan"
"when payment fails to cover the amount of interest due - CORRECT ANSWER=> negative
amortization" "interest rate fluctuates based on some selected economic index (lower interest rate for an initial period)
- CORRECT ANSWER=> adjustable mortgage rate (ARM)"
"where borrower pays off the loan in one lump sum - CORRECT ANSWER=> balloon payment"
"principal portion of the payment increases each month while interest portion decreases - CORRECT
ANSWER=> fully amortized loan"
"where the loan principal is paid down over the life of the loan - CORRECT ANSWER=> amortized loan"
"how do VA loans minimize risk? - CORRECT ANSWER=> guarantee up to a quarter of the loan limit
amount should the buyer default"
"applies to ALL FHA loans for the life of the loan - CORRECT ANSWER=> mortgage insurance premium"
"a conventional loan that fails to meet fannie mae and freddie mac guidelines - CORRECT ANSWER=>
non-conforming loan"
"meets the loan limit and other criteria that fannie mae and freddie mac set - CORRECT ANSWER=>
conforming loan"
"most secure loan - CORRECT ANSWER=> conventional (bc they require a down payment of 20% thus
reducing the LTV to 80%)" "orders the lender or trustee to immediately release full title to the borrower once the loan is paid in full
- CORRECT ANSWER=> defeasance clause"
"the borrower's promise to repay the mortgage loan - CORRECT ANSWER=> promissory note"
"Licensees must complete ______ hours of continuing education every two years - CORRECT
ANSWER=> 15"
"What is the current per-licensee maximum that can be collected from the DC Real Estate Guaranty and
Education Fund? - CORRECT ANSWER=> $50,000"
"Carl lives in a 3 unit DC rental property owned by Margaret. Which of these is the most inclusive
statement about Carl's petition rights and responsibilities? - CORRECT ANSWER=> Tenants have 7 days
after the offer of the sale to request more information; Margaret has 7 days to comply. The tenant organization has 15 days to file a statement of interest; Carl has 7 days after that to file an individual petition" "Simon is selling a 10 unit property. Within how many days from the offer of sale must the tenants provide Simon with a statement of interest to purchase if a tenant organization already exists? -
CORRECT ANSWER=> 30 days (bc tenant org already exists; if one doesn't exist it is 45 days)"
"mixing earnest money with personal funds - CORRECT ANSWER=> commingling"
