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WE HELP COUNTLESS CUSTOMERS PASS THE REAL ESTATE STATE EXAM. All these Guides and Answers are to help pass your Pre-License or Renewal CE (Continuing Education classes) Exams for the state of California. Are you ready to pass the Real Estate Exam? We know how frustrating memorizing all the information to pass the exam can be. We have helped countless people pass the exam with our question and answer pages. SAVING YOU DAYS, WEEKS AND MONTHS OF STUDYING! examples: Private mortgage insurance is required on conventional loans unless what happens? Interest is reduced by 1% The borrower has increased equity to 20% or more The borrower requests a PMI exemption All of the answers shown A loan settlement is also called a: payout disbursement closing deal Which loan type combines a fixed rate term and an adjustable rate term? Non-conventional Home equity Refinance Hybrid A home equity conversion mortgage is commonly called what? A reverse mortgage A HELOC A senior mortgage A second mortgage A HELOC is a: type of reverse mortgage revolving credit instrument fixed rate mortgage that converts to an adjustable rate mortgage a document presented at settlement Lenders have how many days to return any money or property pledged in connection to a cancelled mortgage loan? 10 business days 20 calendar days 30 business days 10 calendar days Adjustable rate mortgage borrowers must receive which additional disclosure during and after loan application? Mortgage Servicing Disclosure Statement Consumer Handbook on Adjustable Rate Mortgages Amortization Adjustment Disclosure Affiliated Business Arrangement Disclosure Under the DFA, lenders are prohibited from extending refinanced credit with a mortgage loan unless: the borrower's FICO score is above 680 the lender has made a good faith effort to determine that the refinanced loan provides a tangible benefit to the borrower the borrower shows a reasonable purpose for the loan proceeds the lender has denied a similar loan structure in the past A borrower has the right to address disputes through: class action lawsuit criminal prosecution civil action All of the answers shown The DFA prohibits which practice(s) that were problematic during the 2001-2006 housing bubble? Offering mortgages with negative amortization Requiring balloon payments that are three times higher than regular monthly payments Requiring borrowers to accept mandatory arbitration None of the answers shown When might a fixed rate loan NOT be advisable for a home buyer? During a period of high interest rates When the home buyer plans to move soon During periods of low interest rates All of the answers shown During periods where the interest rate is expected to rise, what loan type might be suggested? Hybrid Adjustable rate Fixed rate Hard money During the housing bubble, the Federal Reserve Board reduced interest rates from 6.5% to: 5.6% 4% 1% .5% Loan originators did what while risky loans were being settled, which has been shown to have contributed to the housing bubble? Provided down payments for borrowers Provided kickbacks to borrowers when loans were settled "Turned a blind eye" Quickly signed off on high-risk loans Seller financing can be structured as a: contract for deed land title lease Alt-A loan None of the answers shown To best represent the sellers of a property and to understand their motive, you will want to know which of the following? Why they are selling How long they have owned the property Their financial report Upgrades they have made to the property The timing for selling can be extremely important and you may want to make sure that the coordination of the closing of a property is tailored to your ________ circumstances. Sellers’ Managing broker’s Personal Designated broker’s The seller and his or her broker had an Exclusive Right to Sell Listing Agreement. The seller procured a buyer. Which of the following is true? The seller does not owe the broker a commission because he or she procured the buyer. The seller can pay the broker 50% of the commission. The seller owes a commission to the broker regardless of who procured the buyer. The seller does not owe the broker a commission because the broker did not do his or her job in procuring a buyer. A buyer has an Exclusive Buyer Agency Agreement with his or her buyer broker with no other specifications. The buyer locates a property on his or her own without the assistance of the broker. The broker is entitled to: No commission Half of the commission A full commission None of these All of the following methods can be legal descriptions for property except: Lot and block description Metes and bounds Government survey Agency A licensee is a(n) ___________ for his or her designated broker. Co-partner Agent Partner None of these Who owns the listing at a brokerage? Licensee who took the listing Designated broker or brokerage The title company The mortgage company When canceling a listing, the licensee must get the signature of: The Buyers The designated broker and the sellers The licensee’s signature will suffice The buyers and the sellers Who is authorized to sign a listing agreement for the designated broker? Usually the licensed salesperson or associate broker who is affiliated with the broker The unlicensed executive assistant of the designated broker Both of these Neither of these Title is vested as a partnership. The persons in the partnership may be: Related Unrelated Related or unrelated None of these The lead-based paint section of a disclosure statement pertains to houses whose structure was built prior to what year? 1983 1956 1978 1966 Which is the most important section on the disclosure statement? Environmental factors Manufactured and mobile homes Systems and fixtures All of these What is used to disclose a material fact or defect about the property, disclose any environmental hazards, and disclose any defects with the systems of the home to a potential buyer? Seller's disclosure statement Notice to buyer Title Instructions to the seller Which purpose might Wetlands serve? Erosion Control Wildlife Habitat Flood Control All of these What might be most affected by drainage issues? Basements, crawl spaces and foundation Roofs Eaves Ridge beams What sign rider is often used to protect sellers from unscrupulous visitors who may request a private showing? Under Contract Do Not Inquire Within Sale Pending Do Not Disturb What simple tool can be used to assist sellers with protecting items in the home? A pre-listing checklist A pre-showing photo album An insurance appraisal form An affidavit of ownership If another real estate licensee requests a showing of one of your listings, is it appropriate to ask him or her for information about the buyer? Yes. You have a duty to protect your seller client. You may require the buyer agent to provide you with the name and the agency relationship they have with the buyer. No. The buyer’s agent cannot violate his/her fiduciary duty to his/her buyer client. He/she cannot disclose the buyer's name or the agency relationship. Yes. As the seller’s agent, you can demand to know the buyer’s name, address, amount they have been pre-approved for financing, their marital status, and their place of employment. None of the above Should medications be removed from the home prior to showing? Yes. Medications that are not needed on a daily basis should be secured. Yes. But only the most valuable medications. No. Buyers rarely open closed medicine cabinets. No. Buyers will likely be concerned with side effects if they steal medications for personal consumption. Which of the following items should NOT be left out in plain sight? Jewelry Cash Bank statements All of the answers shown In the example provided in this chapter, how could the listing agent have prevented the damage that occurred to the apartment in the multi-family home? Instruct the home inspector to check the deadbolt lock prior to leaving the apartment Check the door prior to departure and contact the landlord immediately Follow the home inspector closely to ensure the deadbolt is not used All of the answers shown Before an open house is held, what can a licensee do to reduce risks and protect the seller? Introduce yourself to neighbors and let them know an open house will be hosted Hang multiple signs around the neighborhood Contact buyers' agents to announce the event Take photos of all valuables in the house Which of the following must a licensee remember to do after the showing is complete? Check to make sure windows are closed and locked Make sure the lights are turned off Lock the door on the way out All of the answers shown What popular social media site provides information about rental scams to homeowners? Facebook Craigslist Twitter LinkedIn When hosting an open house: It is a good idea to host with a team of real estate licensees, so that an agent can be positioned on each floor to answer questions and keep an eye on the property. It is a bad idea to host with a team of licensees. That intimidates the potential buyers The agent should wait outside, so the buyers feel more free to look at the home without interference Asking for buyers to sign in is an invasion of their privacy