California Real Estate practice exam

You are a California real estate broker. A prospect is referred to you by an out-of state broker and a sale is consummated by you. You want to split your commission with the cooperating broker. Under the California Real Estate Law:

you may pay a commission to a broker of another state
you cannot divide a commission with a broker of another state
you can pay a commission to a broker of another state only if he is also licensed in California
none of the above

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15)

The position of trust assumed by the broker as an agent for a principal is described most accurately as:

gratuitous relationship
a trustor relationship
a fiduciary relationship
an employment relationship

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16)

Of the following, which is the most important reason for a broker to maintain a trust fund account in addition to a regular business account?

to provide a means of control over the destiny of transactions being negotiated
it is easier from an accounting point of view
the bank is responsible for any loss to the trust fund account resulting from embezzlement
the consequence which could occur should legal action be taken against the broker

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17)

The instrument used to secure a loan on personal property is called a:

bill of sale
trust deed
security agreement
bill of exchange

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18)

An apartment complex cost $450,000. It brings in a net income of $3,000 per month. The owner is making what percentage of return on the investment?

7%
8%
11%
none of the above

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19)

A subordination clause in a trust deed may:

permit the obligation to be paid off ahead of schedule
prohibit the trustor from making an additional loan against the property before the trust deed is paid off
allow for periodic renegotiation and adjustment in the terms of the obligatio
give priority to liens subsequently recorded against the property

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20)

A broker selling a property on which he holds an option should notify the purchaser that he is acting as:

an optionor
a mortgagor
a beneficiary
a principal

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21)

Community property is property owned by:

the municipality
husband and wife
churches
the community

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22)

Copies of all listings, deposit receipts, cancelled checks, and trust records must be retained by a licensed real estate broker for:

one year
two years
three years
five years

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23)

A "loss of value from any cause" is a common definition of:

economic obsolescence
depreciatio
principle of contributio
adverse leverage

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24)

An interest in real property may be acquired by either prescription or by adverse possession. The interest resulting from prescription is:

the right to use another's land
a possessory title
an equitable interest
a private grant

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25)

Generally, the taking of private land by governmental bodies for public use is governed by due process of law and is accomplished through:

exercise of the police power
eminent domai
reverter
escheat

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26)

The type of mortgage loan which permits borrowing additional funds at a later date is called:

an equitable mortgage
junior mortgage
open-end mortgage
equitable mortgage

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27)

Joint ownership of real property by two or more persons, each of whom has an undivided interest (not necessarily equal) without right of survivorship, is: