39) What is TRUE of mediation? (a) Mediation does not in any way imply a waiver of the right to file a suit if a party is unhappy with the results of mediation

39) What is TRUE of mediation?

(a) Mediation does not in any way imply a waiver of the right to file a suit if a party is unhappy with the results of mediation.

(b) The state of Texas encourages the resolution of disputes between buyers and sellers through mediation.

(c) The cost of mediation is shared between the buyer and the seller.

(d) All of these are true of mediation

40. What is chunking?

(a) When a homeowner is deceived into signing over title to his or her property with the belief that he or she will remain in the home

(b) When a person's identity is used to buy property in order to conceal the actual owner

(c) When multiple loan applications are submitted to various lenders without disclosing the intent to purchase other properties

(d) When fraudsters forge a deed transfer or a satisfaction of lien and then obtain new liens on the property.

41. By default, a Texas title insurance policy does NOT insure against _____.

(a) Defects in the title to real estate before the policy was purchased

(b) Boundary issues

(c) Unknown liens on the property that existed before the purchase of the property

(d) Encumbrances on the property that existed before the purchase of the property

42. _____ services are performed when something of value, such as a deed, money, or written instrument is put into the custody of a third person to be retained until the occurrence of a contingency or performance of a contract.

(a) Casualty loss

(b) Proration

(c) Trust

(d) Escrow

44. Which form would be used by a license holder to advise his/her buyer to obtain title insurance?

(a) The Notice to Prospective Buyer

(b) The Residential Real Property Affidavit

(c) The Consumer Protection Notice

(d) The Subdivision Information Form

45. Which of the following is NOT an option for a buyer if the seller defaults on a sales contract?

(a) Liquidated damages

(b) Refund of earnest money

(c) Monetary damages

(d) Specific performance

46. How is a Public Improvement District created?

(a) By eminent domain

(b) By registering with the Secretary of State’s office

(c) By a vote of at least 51% of the property owners in the neighborhood

(d) By extraterritorial jurisdiction

47. _____ occurs when fraudsters forge a deed transfer or a satisfaction of lien and then obtain new liens on the property.

(a) Chunking

(b) Churning

(c) Straw Buyer scam

(d) Equity Theft

48. According to the TREC contract form, how many days does the buyer have to deliver the Earnest Money Deposit to an escrow agent:

(a) Within 5 days of the Effective Date of the contract

(b) Within 2 days of the option fee requirement

(c) Within 7 days Effective Date of the contract

(d) Within 3 days of the Effective Date of the contract

49. _____ of an offer means that the accepting party does so with no change to the contract, no matter how trivial.

(a) Novation

(b) Acceptance

(c) Counteroffer

(d) Rejection

50. Who sets the closing date of a real estate transaction?

(a) The buyer and the seller

(b) The title company

(c) The selling broker

(d) The listing broker

51. Earnest money is applied first to the cash down payment and then to ____

(a) Seller’s expenses

(b) Buyer’s expenses

(c) Broker’s fees

(d) Refund the seller

52. A seller has agreed to perform all repairs required by the buyer’s lender, but due to inclement weather that basically shut down the city for several days, the repairs may not be completed before closing. What is TRUE of this situation?

(a) The contract must be terminated immediately

b) The buyer may terminate the contract, but the seller gets to keep the earnest money

(c) The lender will sue the seller for 5% of the sales price of the property.

(d) The closing date may be extended up to 5 days to complete the repairs.

53. Who licenses Utility Service Providers in the state of Texas?

(a) Texas Railroad Commission

(b) Texas Real Estate Commission

(c) Texas Commission on Environmental Quality

(d) Texas Secretary of State

54. Jonathan signed a one-year lease on a home in a quiet suburb. After 9 and a half months, his company informed him that he is being transferred overseas. What is true of Jonathan’s lease?

(a) Jonathan’s landlord could accept his partial performance of the contract and terminate it.

(b) The contract will be terminated due to the operation of law.

(c) The landlord could sue Jonathan’s company for transferring him before the lease term is up under the rule of substantial performance.

(d) All of these are possibilities.

55. What is TRUE of the Offer-Counteroffer process?

(a) A buyer and seller can offer, and then counteroffer up to three times each before the process must legally come to an end.

(b) The process of offer/counteroffer may continue until an agreement is made or one of the parties withdraws.

(c) There is only one original offer, and one counteroffer that must be either accepted or rejected, or the process comes to an end.

(d) The process will go into mediation if the offeree and offeror cannot come to a consensus.

56. The _____ form should NOT be attached to the contract as an addendum, but rather be retained in the transaction records maintained by the broker as evidence that the disclosure was provided.

(a) Disclosure of Relationship with Residential Service Company (RSC-2)

(b) Addendum for Seller’s Disclosure of Lead-Based Paint and Lead-Based Paint Hazards (OP-L)

(c) Environmental Assessment, Threatened or Endangered Species and Wetlands Addendum (28-2)

(d) Addendum for Sale of Other Property by Buyer (10-6)

57. Who needs to obtain a Certificate of Reasonable Value (CRV)?

(a) A borrower who is purchasing a condominium

(b) A borrower who is applying for a USDA loan

(c) A borrower who is applying for VA-guaranteed financing

(d) All of these individuals need to obtain a Certificate of Reasonable Value