Current Trends in Real Estate
FINAL Examination
#1 question|The Emergency Stabilization Act of 2008:
#answers|
A. is an exclusion of debt forgiveness on a principal residence
B. applies to debt forgiveness from the years 2006 to 2013
C. states that if the home is below the primary mortgage debt the forgiveness can
be up to as much as 2 million dollars
D. ANSWER }all of these
#explanation|All of these are aspects of the Emergency Stabilization Act of 2008.
#2 question|The most costly form of settling a lien is:
#answers|
A. a deed in lieu of foreclosure
B. ANSWER }a full blown judicial foreclosure
c. both are correct
d. neither is correct
#explanation|It is VERY costly to the lender to pursue a judicial foreclosure.
the homeowner not only loses their home but their credit record is devastated.
And
#3 question|When working with distressed homeowners a licensee should NOT:
#answer|
A. ANSWER }give legal advice
B. work with an experienced short sale licensee
C. suggest the homeowner seek legal advice
D. all of these
#explanation|NEVER give legal advice. Get proper training so you are well informed
before you work with distressed homeowners.
#4 question|If working with a short sale negotiator:
#answers|
A. find out if they are licensed with the state
B. keep compensation to them separate from your interests
C. talk to your broker about negotiators
D. ANSWER }all of these
#explanation|Though short sale negotiators may have training in financing if they
are not licensed they may not know all the risks involved in a short sale.
#5 question|When the homeowner issues a deed to the lender and conveys title to the
lender this procedure is called:
#answers|
A. bankruptcy
B. foreclosure
C. AMSWER }deed in lieu of foreclosure
D. lien
#explanation|When a homeowner has a single mortgage their lender may be willing to
work with the owner with a deed in lieu of foreclosure.
1
#6 question|Which is not a symptom of carbon dioxide poisoning?
#answers|
A. headache
B. dizziness
C. confusion
D. ANSWER }all are symptoms
#explanation|These are all symptoms. High levels of CO can also cause loss of
consciousness and death.
#7 question|All gas appliances must be:
#answers|
A. ANSWER }properly vented
B. patched with gum
C. piped perfectly level
D. none of these
#explanation|Never burn anything in a stove or fireplace that is not vented.
Patching a pipe can cause CO to build up inside the house. Horizontal vent pipes
should not be perfectly level.
#8 question|To avoid carbon monoxide poisoning in your vehicle:
#answers|
A. have the car exhaust checked yearly by a trained mechanic
B. never keep your vehicle running inside a closed garage
C. open vents or windows if driving a vehicle with a tailgate
D. ANSWER } all are correct
#explanation|CO can build up in closed spaces. This includes vehicles.
#9 question|New residential housing must have carbon monoxide alarms installed by:
#answers|
A. ANSWER }January 1, 2010
B. January 2, 2011
C. January 1, 2012
D. January 2, 2013
#explanation|The implementation date is January 1, 2010. All other buildings used
by the public must have CO alarms installed by January 1, 2013.
#10 question|Houses sold after what date must have a CO alarm installed by the
seller?
#answers|
A. July 1, 2009
B. ANSWER }July 1, 2010
C. July 1, 2011
D. July 1, 2012
#explanation|The installment must conform to the Building Code’s requirement before
the buyer or any other person may legally occupy the residence following the sale
#11 question|Prohibited licensee practices include:
#answers|
A. kickbacks
B. steering
C. controlling interest
D. ANSWER }all of these
#explanation|The Real Estate Division prohibits all of these actions.
2
#12 question|Firms/designated brokers do not have to present advertising material
when:
#answers|
A. it is misleading or false
B. it speaks disparagingly of licensees, firms, or employees
C. ANSWER }both statements are correct
D. neither statements is correct
#explanation|Firms/designated brokers cannot prevent advertising material from
being present in areas of public access. However, the material does not have to be
in the agent’s break room and it should not be offensive, misleading, or false.
#13 question|Licensees must disclose in writing to clients regarding home inspector
referrals when:
#answers|
A. the licensee has a business relationship with a specific home inspector
B. the licensee has a family relationship with a specific home inspector
C. ANSWER }both statements are correct
d. neither statement is correct
#explanation|All such disclosures must be revealed in writing.
#14 question|All property management activity:
#answers|
A. ANSWER }must go through the designated broker
B. must go through the affiliated licensee
C. must go through the branch manager
D. must go through the owner
#explanation|The designated broker is ultimately responsible.
#15 question|A designated broker would be held responsible for inadequate
supervision if:
#answers|
A. he/she participated in the violation
B. he/she ratified the violation
C. he/she knew of the violation
D. ANSWER }all of these
#explanation|The designated broker must have written policies, give affiliates
instructions and guidelines, and adequately supervise.
#16 question|Which is NOT one of the three main credit report gathering
institutions?
#answers|
A. ANSWER }freecreditreport.com
B. experion
C. transunion
D. equifax
#explanation|Information that goes into one's credit report comes from Experion,
Transunion, and Equifax.
#17 question|The part of the credit report that would detail bankruptcies?
#answers|
A. employment history
B. FICO score
C. credit inquiries
D. ANSWER }public records
#explanation|The public records would show liens, judgments, overdue child support,
State and county records, as well as bankruptcies.
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#18 question|Credit history would include:
#answers|
A. account activity
B. when an account was opened
C. open accounts
D. ANSWER }all of these
#explanation|Lenders are reluctant to lend money to an individual who has no credit
history established.
#19 question|Which does not help determine FICO score?
#answers|
A. employment history
B. late payments
C. ANSWER }birth date of applicant
D. new credit
#explanation|A number of factors are evaluated when determining the score.
someone was born is not one of those determiners.
The day
#20 question|To improve one's credit score the charge balances should not exceed
what percent of one's credit limit?
#answers|
A. 25%
B. ANSWER }35%
C. 50%
D. 75%
#explanation|Try to keep low credit balances. Balances over 35% of the credit
limit lowers the FICO score.
#21 question|Funding means:
#answers|
A. more conditions need to be met
B. ANSWER }money is made available for the loan
C. both are correct
D. neither is correct
#explanation|At settlement the loan money is available.
#22 question|In many cases if the down payment is less than 20% of the property's
value the borrower must:
#answers|
A. ANSWER }purchase private mortgage insurance
B. pay higher closing costs
C. pay the underwriting commission
D. pay a higher interest rate
#explanation|The lender normally requires the borrower purchase private mortgage
insurance if the borrower is making only a small down payment. This insurance
protects the lender's interests.
#23 question|Documentation needed for a loan includes:
#answers|
A. employment information
B. W-2's
C. copy of income tax return
D. ANSWER }all of these
#explanation|All of these would be required along with more information such as
disclosure of installment payments, debt, earnings, and a credit check.
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#24 question|Which is NOT a closing cost?
#answers|
A. appraisal
B. credit report
C. title insurance fee
D. ANSWER }inquiring about a possible loan
#explanation|There should be no charge to an individual who calls, meets, or goes
online with a lender to find out loan information.
#25 question|Title insurance is what percent of the loan cost?
#answers|
A. ANSWER }1/2 to 1%
B. 1 to 2%
C. 2 to 3%
D. 3 to 4%
#explanation|Title insurance insures the lender that if there is a problem with the
title the lender's money will not be at risk.
#26 question|Judical foreclosure refers to:
#answers
A. inheritance laws
B. federal rulings
C. deeds of trust
D. ANSWER }mortgages
#explanation|Some States have judicial foreclosure which pertains to mortgages and
these take longer to complete.
#27 question|If the short sale is selling the house "as is" the lender will likely
not pay for:
#answers|
A. home inspections
B. roof certification
C. deferred maintenance
D. ANSWER }all of these
#explanation|When the lender is taking a loss, they will not want to pay for any
extra expenses that the normal seller would likely agree to.
#28 question|Which is an eligibility requirement for a short sale?
#answers|
A. market value of home has decreased
B. mortgage is in default
C. mortgage is close to default
D. ANSWER }all of these
#explanation|In order for property to qualify for a short sale the lender must
approve of the offer. The house must be in or close to default. There are other
requirements including the property has decreased in value.
#29 question|True or False: If the property is in the hands of an investor, a
person may still be able to make an offer on their former home.
#answers|
A. ANSWER }True
B. False
#explanation|There may STILL be a chance of the homeowner to make an offer on the
property if an investor is in possession.
5
#30 question|Which is NOT considered a hardship under the HOPE program?
#answers|
A. purchasing another home
B. bad purchase decision
C. unhappy with the neighborhood
D. ANSWER }all are
#explanation|Approved hardships include unemployment, divorce, medical emergency,
bankruptcy, and death.
#31 question|The step beyond pre-qualify is called:
#answers|
A. escrow
B. funding
C. debt to income ratio
D. ANSWER }pre-approval
#explanation|In this stage the lender will contract the potential borrower's bank,
employer, and creditors to gather pertinent information including possibly a credit
report to determine pre-approval.
#32 question|Which is a risk of working with a mortgage broker?
#answers|
A. variety of programs and lenders
B. ANSWER }hidden costs
C. length of time to get a loan
D. the broker shopping around for rates
#explanation|Some mortgage brokers add hidden costs into the loan. The borrower
should learn about all the fees in obtaining a loan and should ask for a breakdown
of all costs.
#33 question|Assurance by a lender in the form of a letter or certificate stating
the amount a person is qualified to borrow for a property purchase:
#answers|
A. stock option
B. ANSWER }pre-qualify
C. credit rating
D. mortgage plan
#explanation|A person can be pre-qualified by a lender without actually locking
themselves into working with that particular lending institution.
#34 question|The debt to income ratio is a:
#answers|
A. credit report
B. loan amount
C. service fee
D. ANSWER }factor in determining the interest rate
#explanation|When all the debt is added together and all the income is determined,
this is called the debt to loan ratio.
#35 question|When choosing a mortgage broker or lender:
#answers|
A. do your research
B. interview each lender
C. ask each one the same questions
D. ANSWER }all of these
#explanation|The purchaser should take the time to select a lender that will best
serve them.
6
#36 question|The first time home buyer credit is for:
#answers|
A. someone not owning a home in the previous 3 years
B. first time buyers
C. ANSWER }both
D. neither
#explanation|A first time home owner is not necessarily a first time buyer. An
applicant may be eligible if they HAVE NOT owned a home in the previous three
years. Perhaps prior to 3 years ago they owned a home or several homes and that
would not disqualify them.
#37 question|The
#answers|
A. the purchaser
B. taxpayer must
C. ANSWER }both
D. neither
#explanation|The
property may NOT
first time buyer's purchase requires:
use the home for residential purposes
live in the home for at least 3 years
purchaser must live in the home for at least 3 years. The
be used for investment purposes, for heirs, or for charity.
#38 question|On IRS Form 5410:
#answers|
A. ANSWER }the taxpayer swears he/she will live in the house
B. the taxpayer agrees to use the property for rental purposes
C. the taxpayer promises to live in the home for 1 year
D. the commercial business applying for the credit would list their investors
#explanation|The taxpayer must reside in the home for at least 3 years and the
purchase must NOT be a commercial investment.
#39 question|The 2008 tax credit:
#answers|
A. does not need to be paid back
B. ANSWER }must be paid back to the Federal government
C. must be repaid in 3 years
D. is repaid when the property is sold
#explanation|The 2008 tax credit must be paid back to the government in 15 equal
installments over a 15 year period.
#40 question|2009 purchasers can qualify for up to:
#answers|
A. $4,000 individually
B. $8,000 as a married couple filing jointly
C. ANSWER }both are correct
d. neither are correct
#explanation|If a married couple files separately each would be entitled to up to a
$4000.00 credit.
#41 question|The 2009 tax credit:
#answers|
A. ANSWER }does not need to be repaid
B. does need to be paid back
C. is not based on income
D. is for aliens only
#explanation|The beauty of the 2009 tax law is that the taxpayer is NOT required to
repay the tax credit.
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#42 question|Under the First Time Home Buyer Program, the income limit for a single
taxpayer is:
#answers|
A. $25,000
B. $50,000
C. ANSWER }$75,000
D. $100,000
#explanation|Using the Modified Adjusted Gross Income (MAGI) any single taxpayer
with adjusted gross income above $75,000 would not be eligible.
#43 question|The income limit for a married couple filing jointly is:
#answers|
A. $50,000
B. $75,000
C. $100,000
D. ANSWER }$150,000
#explanation|Using the Modified Adjusted Gross Income (MAGI) any married couple
filing jointly with adjusted gross income above $150,000 would not be eligible.
#44 question|Which WOULD NOT be eligible for the 2009 tax credit?
#answers|
A. purchasing a home for one's daughter
B. purchasing a home to use as a rental
C. selling the house after 2 years
D. ANSWER }all of these
#explanation|The credit is only for the purchaser who is residing in the home.
They must live in the home for at least 3 years. They may not use the residence as
a rental or purchase property for another person to reside in.
#45 question|To file a tax credit with the IRS:
#answers|
A. you claim it on your 1040
B. form 5405 must be filled out
C. ANSWER }both
D. neither
#explanation|Form 5405 must accompany the 1040 form to the IRS.
#46 question|Which statement about the HOPE program is incorrect?
#answers|
A. ANSWER }there is a counseling fee
B. there is not a counseling fee
C. help is free from a lender
D. help is free from a HUD-approved housing counselor
#explanation|There is never a fee to get assistance or information about the
“Making Home Affordable" program from a lender or a HUD-approved housing counselor.
#47 question|"Current" on mortgage payments means:
A. taxpayer just made a mortgage payment
B. ANSWER }not late more than 30 days on the l2 months of mortgage payments
#explanation|To be considered "current" one must not be late more than 30 days on
the last 12 months of mortgage payments.
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#48 question|Documents a homeowner must gather for home affordable financing:
#answers|
A. most recent tax return
B. paystubs
C. information on a second mortgage
D. ANSWER }all
#explanation|All of these documents and additional documents would be required.
#49 question|Can a client qualify if they owe more than what their home is worth?
#answers|
A. ANSWER }yes, if the 1st mortgage does not exceed 105% of the current market
value
B. yes in all cases
C. both
D. neither
#explanation|As long as the 1st mortgage does not exceed 105% of the current market
value of their home they may qualify.
#50 question|Which is not included in the program?
#answers|
A. ANSWER }cash for other debts
B. fixed rate
C. affordable payments
D. safe loan
#explanation|The program will not assist with debt other than debt regarding the
mortgage.
#51 question|True or False: Second mortgages are eligible for a modification.
#answers|
A. True
B. ANSWER }False
#explanation|Only the 1st mortgage is part of this program.
#52 question|Servicer participation in the program is:
#answers|
A. discouraged by the Federal government
B. available from all lenders
C. involuntary
D. ANSWER }voluntary
#explanation|Participation in the program is voluntary. Because the government is
offering hefty incentives to lenders many will be participating.
#53 question|A qualifying home cannot be worth more than:
#answers|
A. $290,000
B. $529,000
C. $700,000
D. ANSWER }$729,750
#explanation|The purpose of the program is to help individuals refinance so they
will have affordable payments. The program does not cater to those who purchased
high-end homes well above their means.
9
#54 question|How low can the interest rate go?
#answers|
A. ANSWER }2%
B. 3%
C. 4%
D. 5%
#explanation|The Treasury will attempt to get an AFFORDABLE payment plan for
participants. They are willing to go as low as 2% interest and the lenders are
provided incentives so this can be accomplished.
#55 question|What is the financial incentive to buyers?
#answers|
A. for every payment made on time the Treasury will reduce the principal
B. total principal reduction in 5 years could be up to $5,000
C. ANSWER }both
D. neither
#explanation|The plan includes rewarding those who make every payment on time. By
making timely payments the purchaser can realize up to $5,000 reduction in their
principal over the 5 year period.
#56 question|The trend for older buyers over the last 2 years has been:
#answers|
A. ANSWER } to down size their home
B. to purchase sizable homes
C. to pay cash
D. to not desire luxury
#explanation|Older buyers are tending to purchase smaller homes with luxury items.
#57 question|Boomers is the nickname for:
#answers|
A. those who wish to buy big ticket items
B. ANSWER } individuals born right after WW II
C. individuals who utilize leverage buying
D. those who want maximum entertainment
#explanation|Boomers are those individuals who were born in the “baby boom” when
the soldiers came home after World War II. They currently would be 64 and younger.
#58 question|The Distressed Property Law was designed to:
#answers|
A. be a consumer advocate statute
B. protect the equity interests of homeowners involved with foreclosure or possible
foreclosure
C. protect homeowners from equity skimming
D. ANSWER } all of these
#explanation|The legislature and governor enacted the distressed property law in
June of 2008 to protect all of these groups.
#59 question|Which is an example of equity skimming?
#answers|
A. ANSWER }Buyer obtains title to the house through a quit claim deed, evicts the
seller as a tenant, sells the house, and obtains the equity interest
B. Homeowner sells to a buyer and makes a profit
C. Homeowner sells to a buyer at an inflated price
D. Buyer and seller sign a purchase agreement
#explanation|Equity skimming refers to the buyer gaining title to the house; the
seller is evicted as the tenant when the new buyer sells the house.
10
#60 question|Where can scam artists go to find out which properties are in
foreclosure?
#answers|
A. MLS website
B. ANSWER }Assessor’s office
C. Treasurer’s office
D. Sheriff’s office
#explaination|Anyone can call or go to the Assessor’s office and obtain information
regarding property in foreclosure.
#61 question|Which would qualify as distressed home property?
#answers|
A. seller defaulted on a mortgage
B. seller is at least 30 days delinquent on the mortgage
C. seller believes he/she will be in default of a loan within the next four months
D. ANSWER }all of these
#explanation|All of these would qualify as distressed property owner as well as
when the property has a non-payment of property tax lien on the part of the county.
#62 question|A licensee performing “routine” real estate services:
#answers|
A. would be classified as a distressed home consultant
B. ANSWER }would be exempt from the definition of a distressed home consultant
C. both statements are correct
D. neither statement is correct
#explanation|Real estate licensees are exempt from the definition of a distressed
home consultant when rendering routine real estate services.
#63 question|When a licensee participates in a sell back agreement:
#answers|
A. he/she opens themselves up to greater liability exposure
B. they become a distressed home consultant
C. their exemption from the distressed property act is lost
D. ANSWER }all of these are correct
#explanation|There could be all sorts of problems for the licensee when they become
a distressed home consultant.
#64 question|If a transaction closes how many days prior to foreclosure of a
property and the buyer moving into the property will not be a problem?
#answers|
A. 5 days or less
B. 10 days or less
C. 15 days or more
D. ANSWER }20 days or more
#explanation|When a transaction closes more than 20 days prior to foreclosure of
the property and the buyer moves into the subject property.
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#65 question|What is the form called that is used when the seller is not
represented?
#answers|
A. Form 22-FSBO (rev. 3/07)
B. ANSWER }Form 22-FSBO (rev. 3/09)
C. DSH Form
D. None of these
#explanation|When the seller is not represented, the buyer and the licensee face
the risk of becoming a distressed home consultant. The licensee for the buyer
should include Form 22-FSBO (rev. 3/09) with any offer where the seller is not
represented.
#66 question|As a licensee you will want to contact “whom” before you before you
become a distressed property consultant?
#answers|
A. IRS
B. ANSWER }your lawyer
C. the buyer
D. the seller
#explanation|Talking to your lawyer about the problems associated with the
distressed property law is advisable BEFORE you start working with a distressed
home.
#67 question|Which are following are able to practice as a distressed home
consultant but are not subject to the law in any capacity?
#answers|
A. attorneys
B. mortgage brokers
C. credit consultants
D. ANSWER }all of these
#explanation| All of these are exempt as well as financial institutions and any
business that works with homeowners and their mortgage problems (mortgage loan
services).
#68 question|The practice of loyalty to your client is called:
#answers|
A. financial responsibility
B. ANSWER }fiduciary responsibility
C. fiscal responsibility
D. fraternity responsibility
#explanation|As a fiduciary you are to act in the best interests of your client.
#69 question|Information that would affect the sellers and buyers with any
transaction is called:
#answers|
A. puffing
B. red-lining
C. ANSWER }material fact
D. none of these
#explanation| The RCW regarding agency law states that you, the licensee must
divulge all known material facts about the involved property to each party of the
transaction.
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#70 question|Penalties for damages suffered by a seller under the distressed
property law are:
#answers|
A. ANSWER }two to three times the court determined damages suffered by the seller
B. a one time the court determined damage amount suffered by the seller
C. 4 to 5 times the court determined damages suffered by the seller
D. 10 times the court determined damages suffered by the seller
#explanation|Under the distressed property law payment of two to three times the
court determined damages suffered by the seller up to a maximum of $100,000 is
possible.
#71 question|True or False: The licensee may also be forced to pay the entire
seller’s legal fees and costs under the distressed property law.
#answers|
A. ANSWER }True
B. False
#explanation|This is true. In many instances this could be of greater expense than
the payment award.
#72 question|Who drafted the original distressed property law?
#answers|
A. governor
B. board of realtors
C. ANSWER }attorney general’s office
D. MLS
#explantion|HB 2791 was based on legislation proposed by the Attorney General’s
office to help protect financially strapped homeowners from equity skimming and
foreclosure rescue scams.
#73 question|A violation of the Distressed Property Act is:
#answers|
A. a felony
B. ANSWER }a violation of the Consumer Protection Act
C. okay as long as your broker okays your actions
D. subject to life imprisonment
#explantion|The Attorney General’s Office can take civil actions against a law
violator that engages in deceptive practices that harm consumers.
#74 question|True or False: The Attorney General’s Office gives legal advice and
interprets the distressed property law.
#answers|
A. True
B. ANSWER }False
#explanation|The Attorney General’s Office does not provide legal advice or
interpretation. This new law may also be subject to different interpretations
between judges and lawyers.
#75 question|A person who believes they are a victim of equity skimming or
foreclosure scam can:
#answers|
A. file a complaint with the Attorney General’s Office
B. speak with a homeownership counselor
C. consult an attorney
D. ANSWER }all
#explanation|Free foreclosure and homeownership counseling is available through the
State of Washington. Victims can contact all of the above.
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#76 question|According to a recent survey from Move.com how many Americans are
planning to purchase a home in 2010?
#answers|
A. 1 in 10
B. ANSWER }1 in 20
C. 1 in 50
D. 1 in 100
#explanation|According to a recent survey only 1 in 20 Americans polled planned to
purchase a home in 2010.
#77 question|To help save energy what is an incentive to homeowners?
#answers|
A. energy credits for purchasing energy saving appliances as a tax deduction
B. appliances that save energy
C. a home built more efficiently
D. ANSWER }all of these
#explanation|All of these are identified as measures to curtail energy use.
#78 question| What is a downsizer?
#answers|
A. baby boomer
B. those born following World War II
C. retirees
D. ANSWER }all
#explanation|Many people retiring or close to retirement are opting to sell their
large family home and choose smaller quarters close to medical facilities,
recreational, and shopping areas that are easily accessible.
#79 question|What is the maximum limit for damages under the Consumer Protection
Act?
#answers|
A. $1,000
B. ANSWER }$10,000
C. $100,000
D. No limit
#explanation|The maximum is $10,000. Under the Distressed Property Law the
liability is increased to $100,000.
#80 question|The Distressed Home Consultant bill drafted by the Attorney General’s
Office offered:
#answers|
A. homeowners the ability to lease or buy back their property
B. written contracts to homeowners that completely describe the terms of the sale
C. the right for the homeowner to cancel the sale within five days
D. ANSWER }all of these
#explanation|All three of these were part of the bill as drafted by the Attorney
General’s Office.
#81 question|The latest version of the Distressed Property Law was updated:
#answers|
A. March, 2001
B. March, 2002
C. March, 2007
D. ANSWER }March, 2009
#explanation|The law was revised March of 2009.
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#82 question|Normally in a short sale who makes the final decision if the sale will
go through or not?
#answers|
A. the homeowner
B. ANSWER }the lender
C. the creditors
D. escrow
#explanation|Most short sales hinge on whether the lender will accept the sale.
#83 question|If the seller acknowledges the home is subject to the distress home
definition the licensee should:
#answers|
A. explain to the buyer the position that could occur if the home went into
foreclosure
B. fill out a Form 22-FSBO
C. consult an attorney before getting involved
D. ANSWER }all of these
#explanation|Becoming a distressed home consultant opens the licensee to great
liability so you will want to know what you are doing.
#84 question|Under the distressed property law a licensee can:
#answers|
A. offer to sell distressed property BEFORE foreclosure occurs
B. represent a distressed homeowner
C. close a purchase and sale agreement within 20 days of a foreclosure sale
D. ANSWER }all of these
#explanation|Under the distressed property law you are NOT a distressed home
consultant. You can do all of the above.
#85 question|Who makes money on a short sale?
#answers|
A. the seller
B. ANSWER }everyone except the seller
C. the seller’s family
D. no one does
#explanation|Everyone involved with the short sale makes money; the seller however
does not.
#86 question|When a buyer obtains title to a house through a quit claim deed,
evicts the seller as a tenant, sells the house, and pockets the equity this is
called:
#answers|
A. profit sharing
B. capitalism
C. ANSWER }equity skimming
D. profit hedging
#explanation|This practice of scam artists to take advantage of the plight of a
homeowner is called equity skimming.
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#87 question|Under House Bill 2791 a homeowner/seller can:
#answers|
A. waive his/her rights under this act
B. ANSWER }cannot waive his/her rights under this act
C. has a choice whether to waive their rights
D. always makes the final decision
#explanation|House Bill 2791 is VERY specific that NO HOMEOWNER/SELLER can waive
his/her rights under this act.
#88 question|A potential distressed home would be which of the following?
#answers|
A. rental housing
B. commercial structures
C. housing where the homeowner owns but does not live
D. ANSWER }residence of the homeowner
#explanation|A home is defined as a single structure, four plexes or less with one
unit as the residence, condominium units in a building with more than 4 units, and
other types of residential units.
#89 question|What form does the Multiple Listing Services not have a form for?
#answers|
A. purchase and sale agreement
B. ANSWER }distressed home consultant
C. both
D. neither
#explantion|If the buyer purchases and allows the distressed homeowner to continue
to occupy the property with the understanding the property will be conveyed back to
the current homeowner OR offers the current homeowner an interest in the proceeds
from a future sale thus creating a distressed home consultant situation this
transaction is so risky MLS does not have an existing form for this type of
purchase.
#90 question|When in 1997 the legislature put together a series of RCWs and WACs
clarifying the agency function in representing brokers and clients this was known
as:
#answers|
A. ANSWER }agency law
B. civil law
C. property law
D. case law
#explanation|Establishing current agency law gave the licensees specific guidelines
to follow. They could look up procedures required by the State of Washington.
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