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"A" and "B" bought a house as tenants in common. If "A" dies which of the following statements about ownership of the house is correct? A) It automatically becomes tenancy in severalty. B) It is divided, with B retaining their original interest and the balance going to A's estate. C) B holds fee simple ownership to A's share of the property D) B holds a life estate ownership to A's share of the property - Correct Answer B) It is divided, with B retaining their original interest and the balance going to A's estate. The difference between the value of a property and the total amount of liens against it is known as: A) A down payment B) Equity C) Actual cash value D)Collateral - Correct Answer B) Equity If a husband and wife take title to a property as tenants in common, they may also have elected to have: A) Title in severalty B) Separate life estates C) The right of survivorship D) Unequal shares of ownership - Correct Answer D) Unequal shares of ownership A person who openly, continuously and hostilely occupies another's land for a period set by a statute may gain title by means of: A) Voluntary alienation B) Accretion C) Prescription D) Adverse possession - Correct Answer D) Adverse possession Truth-In-Lending Act requires the lender to furnish an applicant for a real estate loan with a copy of an: A) Amorization schedule B) Disclosure statement C) Deed D) Financial statement - Correct Answer B) Disclosure statement The seller is responsible for which of the following costs at closing: A) The realty transfer tax B) The title search D) Own real property - Correct Answer B) Must pas assessments Which of the following is not necessary to a valid contract: A) Consideration B) Contractual ability C) Legal purpose D) The signature of both parties - Correct Answer D) The signature of both parties Which is NOT true of a tax lien sale? A) Title passes with the sale B) The lien holder is the lowest interest bidder C) The municipality may hold the lien D) The property owner has two years to pay the lien - Correct Answer A) Title passes with the sale Which would be a credit to the purchaser at settlement? A) The balance of an existing mortgage to be assumed B) Taxes overpaid by the seller C) Fuel oil remaining in the tank D) Unpaid new mortgage - Correct Answer A) The balance of an existing mortgage to be assumed In a condominium apartment project, the BEST term to describe a swimming pool and laundry room for the use of unite owners is? A) Common elements B) Limited common elements C) Fee simple elements D) Leasehold elements - Correct Answer A) Common elements When homeowners itemize deductions in computing their annual taxable income they may deduct: A) Payments of principal on the home mortgage B) Interest paid on the home mortgage C) Depreciation of the home D) Cost of repair - Correct Answer B) Interest paid on the home mortgage Dual Agency is best described as: A) Two companies working together B) Owing special duties to another person C) Brokers taking both parties as principals D) None of the above - Correct Answer C) Brokers taking both parties as principals A) The right of survivorship B) The right of Joint Possession C) The right of devise D) Equal shares of ownership - Correct Answer C) The right of devise A clause in the deed or mortgage which would indicate the interest transferred or mortgaged: A) Covenant of seisin B) Habendum C) Granting clause D) Acceleration clause - Correct Answer B) Habendum Which credit terms may be included in an advertisement for real estate without further disclosure? A) 10% annual percentage rate B) 5 years to repay C) $5,00 down payment D) $300 monthly payment - Correct Answer A) 10% annual percentage rate Failure of homeowners to pay for labor to repair their homes may result in a : A) Mechanic's lien/construction lien B) General lien C) Bankers lien D) None of the above - Correct Answer A) Mechanic's lien/construction lien The recording of a deed or other instrument in the public records: A) Constructive notice B) Acknowledgment C) Actual notice D) Hypothecation - Correct Answer A) Constructive notice In a property transfer, the signature of the grantor's spouse would waive: A) The spouse's right to any proceeds B) Dower or courtesy right C) The grantee's right to a fee estate D) The grantee's right to any warranty - Correct Answer B) Dower or courtesy right The right of ingress and egress over the land of another is classified as an: A) Servant tenement B) Easement C) Encroachment D) Equitable lien - Correct Answer B) Easement A CORRECT statement about the Federal National Mortgage Association (FNMA) is that it: A) Purchases certain mortgages originated by lending institutions B) Insures mortgages through insurance fees paid by borrowers C) Provides guarantees to lenders on certain mortgages D) Is the nation's central bank designed to provide economic stability - Correct Answer A) Purchases certain mortgages originated by lending institutions An Inherent State right, allowing the government to acquire title to the land of an interstate, where no natural heirs can he found: A) Eminent domain B) Police power C) Statute of limitations D) Escheat - Correct Answer D) Escheat In a real estate closing the buyer generally pays for the: A) Release of the mortgage B) Recording of a new mortgage C) Preparation of the deed D) Sales commission - Correct Answer B) Recording of a new mortgage Ata sale in foreclosure, which lien would haw the least priority of payment? A) First Mortgage B) Property taxes C) Mechanic's lien D) Tax lien certificate - Correct Answer A) First Mortgage Which of the following clauses will put the priority of an existing mortgage or deed of trust below, that of a mortgage recorded later? A) An exculpatory clause B) A repayment clause C) A subordination clause D) An assumption clause - Correct Answer C) A subordination clause When a contract states that "Time is of the Essence," the contract must be executed: A) Within twenty-four hours B) Within a specified time frame C) Within two business days C) Specific performance D) Constructive eviction - Correct Answer C) Specific performance The donation of private land for public use is called: A) Accretion B) Dedication C) Assignment D) Condemnation - Correct Answer B) Dedication Which of the following deeds should a grantor use to transfer an uncertain interest in real property? A) Warranty B) Special warranty C) Grant D) Quitclaim - Correct Answer D) Quitclaim When a buyer purchases a property subject to seller's existing mortgage, which of the following statements is CORRECT? A) The seller's credit will not be affected by foreclosure on the property. B) The seller is released from all liability. C) Any mortgage loan obtained by the buyer to complete the purchase will be a first mortgage loan D) The seller's obligation under the existing mortgage remains unchanged - Correct Answer D) The seller's obligation under the existing mortgage remains unchanged The Housing and Urban Development (HUD)settlement statement includes which of the following information? A) The buyers' and sellers’ closing costs B) The sellers’ closing costs only C) The total interest and principal to be paid by the buyers only D) The closing costs that are tax deductible - Correct Answer A) The buyers’ and sellers’ closing costs The highest form of ownership under the Allodial System would be: A ) Fee simple B) Fee conditional C) Life estate D) Leasehold estate - Correct Answer A ) Fee simple The method of describing real estate that will hold up in a court of law is called: A ) Picture method only B) Legal description C) Plain English description B) Hypothecation C) Subrogation D) Right of re-possession - Correct Answer A) The equity of redemption A title insurance policy will protect a buyer from financial losses that are caused by: A) A change in zoning regulations B) A recorded easement to which the policy has not taken an exception C) An unrecorded easement D) An encumbrance to which the policy has not taken an exception - Correct Answer D) An encumbrance to which the policy has not taken an exception The process under which the government may take real property for the greater public good: A) Condemnation B) The allodial system C) Police power D) Escheat - Correct Answer A) Condemnation A deed in which the grantor warrants that title was unencumbered for as long as the grantor held it: A) Bargain and sale deed B) Bargain and sale deed. CVG C) Warranty deed D) Sheriff's deed - Correct Answer B) Bargain and sale deed. CVG Charging an interest rate higher than the legal limit is called: A) Graft B) Compounding C) Usury D) Discounting - Correct Answer C) Usury Which statement about an oral sales contract that involves the sale of real estate is correct? A) It may not be enforceable if a breach takes place B) It is not subject to the Statute of Frauds C) It is a common method of consummating a sale D) It is assignable to a third party - Correct Answer A) It may not be enforceable if a breach takes place An easement in gross is typically a: A) Right of way B) Public utility easement C) Land acquisition D) Dominant estate - Correct Answer B) Public utility easement An attachment is likely result of: A) A home improvement B) An addendum to contract C) A sale and leaseback D) Pending litigation - Correct Answer D) Pending litigation A lender is required under the Truth-in-Lending Act (Regulation Z) to furnish an applicant for a real estate loan with a copy of a/an: A) Amortization B) Disclosure statement C) Deed D) Financial Statement - Correct Answer B) Disclosure statement The term Point of Beginning (POB) is best associated with which of the following: A) Mortgage finance B) People on board vessel departure C) Metes and bounds D) Exam retakes - Correct Answer C) Metes and bounds A lender's title insurance policy will protect the: A) Lender against default in loan payments B) Borrower against default in loan payments C) Lender against existing undiscovered title defects D) Borrower against unrecorded liens - Correct Answer C) Lender against existing undiscovered title defects The G's purchased a house from the Ts. The G's agreed to the following terms: monthly payments of $650 to the T's and the balance to be paid in full after seven years. At the time the balance is the T's will give the G's a warranty deed transferring title. In this situation which of the following types of financing is used? A) FHA loan B) Wraparound mortgage C) Package mortgage D) Land contract sale - Correct Answer D) Land contract sale In reviewing the Deed to a listed property, a licensee noted a number of limitations regarding use. These limitations are commonly known as: 
