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Question 1 of 10
1. Question
The definition of whether an object of physical degradation is curable or incurable is a feature of depreciation considered during when?
Correct
Curable and incurable with regard to a depreciation object has little to do with whether it is practically possible to fix the item. The theory is based on whether or not the cost of fixing anything will add an equal value to the (curable) land (incurable). Cost and benefit, in contrast to each other, are also incorrect responses.
Incorrect
Curable and incurable with regard to a depreciation object has little to do with whether it is practically possible to fix the item. The theory is based on whether or not the cost of fixing anything will add an equal value to the (curable) land (incurable). Cost and benefit, in contrast to each other, are also incorrect responses.
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Question 2 of 10
2. Question
If a house’s reproduction expense is $300,000 for the economic life of 50 years, how much does the house depreciate using the straight line method of depreciation calculation per year?
Correct
Assuming the straight-line depreciation if the house’s entire expense depreciates over the house’s projected lifespan (economic life) at an equal rate per year. Reproduction or Cost of House ÷ Economic Life of House = Annual Depreciation, so $300,000 ÷ 50 years = $6,000 yearly depreciation.
Incorrect
Assuming the straight-line depreciation if the house’s entire expense depreciates over the house’s projected lifespan (economic life) at an equal rate per year. Reproduction or Cost of House ÷ Economic Life of House = Annual Depreciation, so $300,000 ÷ 50 years = $6,000 yearly depreciation.
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Question 3 of 10
3. Question
Buyer A is borrowing money to purchase a property. According to the repayment agreement, he will have to turn over a percentage of the profit he makes on the home to the lender when he sells the property. What kind of mortgage is this referring to?
Correct
It is required for the shared appreciation mortgage to allow some of the profit generated to be shared with the lender when selling the home.
Incorrect
It is required for the shared appreciation mortgage to allow some of the profit generated to be shared with the lender when selling the home.
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Question 4 of 10
4. Question
The difference between the primary market for mortgages and the secondary market for mortgages is that the secondary market for mortgages is best described in which of the following statements?
Correct
By purchasing mortgage loans from primary lenders, the function of the secondary market is to hold mortgage money in circulation.
Incorrect
By purchasing mortgage loans from primary lenders, the function of the secondary market is to hold mortgage money in circulation.
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Question 5 of 10
5. Question
After all other payments have been received, a mortgage loan that results in the entire principal balance being due at the end of the period. Which of the following is this situation referring to?
Correct
Non-amortization suggests that during the duration of the loan, none of the principal was paid off.
Incorrect
Non-amortization suggests that during the duration of the loan, none of the principal was paid off.
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Question 6 of 10
6. Question
Which of the following statements is true?
Correct
You may argue that all the options are right in the way the options are worded, but questions such as this will also be asked by question writers, implying the smallest amount above which private mortgage insurance must be bought.
Incorrect
You may argue that all the options are right in the way the options are worded, but questions such as this will also be asked by question writers, implying the smallest amount above which private mortgage insurance must be bought.
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Question 7 of 10
7. Question
Which of the following statement best describes a loan that conforms?
Correct
A conforming loan follows the requirements of FNMA underwriting and the loan amount limits.
Incorrect
A conforming loan follows the requirements of FNMA underwriting and the loan amount limits.
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Question 8 of 10
8. Question
Which of the following statements about the potential advantages of a selling leaseback contract is not included?
Correct
In general, real estate assets are not deemed to be liquid or quickly sold.
Incorrect
In general, real estate assets are not deemed to be liquid or quickly sold.
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Question 9 of 10
9. Question
Which of the following pair/s consists of words that mean the same thing in essence?
I. A trustor and a creditor
II. Mortgages and borrowers
III. Selling of foreclosure and trustee’s
IV. Borrower and MortgageCorrect
Foreclosure and the sale of a trustee basically apply to the same action of selling the property when the mortgage debt is non-payable.
Incorrect
Foreclosure and the sale of a trustee basically apply to the same action of selling the property when the mortgage debt is non-payable.
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Question 10 of 10
10. Question
Which of the following statements about commissions is true?
Correct
California law (part of the law on real estate licenses) sets loan brokerage commission limits.
Incorrect
California law (part of the law on real estate licenses) sets loan brokerage commission limits.