CALIFORNIA REAL ESTATE EXAM MULTIPLE CHOICE EXAM 500 QUESTIONS AND CORRECT DETAILED ANSWERS WITH RATIONALES|ALREADY GRADED A||EVERYTHING YOU NEED TO PASS CALIFORNIA REAL ESTATE EXAM IN ONE DOCUMENT
CALIFORNIA REAL ESTATE EXAM 2023-2024 MULTIPLE
CHOICE EXAM 500 QUESTIONS AND CORRECT DETAILED
ANSWERS WITH RATIONALES|ALREADY GRADED
A||EVERYTHING YOU NEED TO PASS CALIFORNIA REAL
ESTATE EXAM IN ONE DOCUMENT
For a "blanket encumbrance," the typical release clause requires the debtor to pay
more to the lender than each released property is worth because:
a. better lots are sold first.
b. compensates for unsold lots.
c. lender desires to increase security on overall loan.
d. all of the above. - ANSWER- d. all of the above.
A fire station building and a small appliance sales and repair store were recently
leased on long-term leases at the same lease payment. Between the two, the fire
station building would probably have a stable capitalization rate, which would be:
a. higher.
b. lower.
c. same as.
d. varying; sometimes higher, sometimes lower than the other property. -
ANSWER- b. lower.
Rationale: Since the lessee of the fire station building would be the
government, classified as a more stable tenant, the owner would probably be
willing to accept a lower return on investment.
In determining the value of a property, an appraiser would use the:
a. cost approach.
b. market approach.
c. income approach.
d. any or all of the above. - ANSWER- d. any or all of the above.
Rationale: Appraisers use all three approaches to determine value.
"Domicile" most frequently means:
a. semi-circled ceiling.
b. relationship of parties.
c. home or residence.
d. none of above. - ANSWER- c. home or residence.
An investor who owned a 16-unit apartment complex has evaluated a newly
installed freeway near his property, which has caused a decrease in monthly rent in
the amount of $320. When an 11% "cap rate" for the area is applied, what is the
resulting loss in value he has experienced due to the freeway?
a. $45,000
b. $40,908
c. $34,909
d. $32,468 - ANSWER- c. $34,909
Which of the following represents an essential part of a valid grant deed?
a. Acknowledgment and recordation
b. Offer and acceptance
c. Parties capable of contracting
d. Parties properly described - ANSWER- d. Parties properly described
Rationale: The five essential elements of a valid deed are: (1) In writing; (2)
Parties properly described; (3) Adequate property description; (4) Operative
words (granting); (5) Signed by Grantor.
In contracting, if one of the parties enters the agreement under duress, the contract
would be:
a. valid.
b. voidable.
c. void.
d. Illegal. - ANSWER- b. voidable.
Rationale: Until proved either valid or void, it is voidable.
Under a real property sales contract, Buyer "A" makes a $2,000 down payment to
Seller "B" on a property he had been renting. The agreement is filed with the
county recorder. Subsequently, "A" moves to Florida, without making any further
payments, and with no notice of his intentions being made to "B." Which of the
following would be true?
a. Seller could resell the property and obtain a deficiency judgment against "A."
b. New buyer should not be concerned about the previous sales to "A."
c. "A's" activity has no effect upon the marketability of the property.
d. There would be a cloud on the title to the property. - ANSWER- d. There would
be a cloud on the title to the property.
Rationale: Seller "B" would need a quitclaim deed from "A," or would need
to seek a "quiet title action" in court to clear the cloud on his title so he could
sell the property to another.
Appraisal fees:
a. may vary.
b. are always a fixed amount.
c. are based on a percentage of the appraised value.
d. are set by the loan broker. - ANSWER- a. may vary.
Rationale: An appraiser's fee is set by the difficulty of the work and by the
level of expertise required to complete the work. Percentage fees are illegal.
An unlawful detainer action may be filed by a landlord in all but one of the
following. Which is it?
a. Tenant holds over after termination of lease.
b. Tenant fails to pay rent.
c. Tenant exercises lease option agreement, but fails to make payment as required.
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