REAL ESTATE LAW
Fall2008 Homework Answer on scantron form 882
1. A promissory note:
a. creates a lien against the propertyb. is only used with deeds of trust
c. is only used with mortgagesd. states a promise to repay a debt
2. The date a loan is to be paid off is called the:
a. due dateb. maturity date
c. final payment dated. accrued date
3. A promissory note that includes periodic payments of principal and interest is called a(n):
a. installment noteb. straight note
c. secured noted. partial note
4. Which of the following are parties to a deed of trust?
a. Trustorb. Beneficiary
c. Trusteed. All of the above
5. A fictitious trust deed:
a. is not completely filled outb. is not legal in California
c. is filled out except for the first paged. is only used for commercial property
6. When a loan agreement doesn't give the borrower the option to prepay, the loan is said to be:
a. a partially amortized loanb. secured loan
c. deeded loand. locked in
7. When a owner takes a property “subject to”:
a. the new owner is responsible for any deficiency judgment
b. the new owner is always responsible for any liens
c. the former owner is responsible for any deficiency judgment
d. the new owner cannot lose the property to foreclosure
8. A later filed trust deed that is given a higher priority is called a:
a. new deedb. priority trust deed
c. superior trust deedd. subordinating trust deed
9. Which of the following is a way for a borrower to prevent a foreclosure process?
a. Cure the default to reinstate the loan
b. Redeem the property
c. Give the lender a deed in lieu of foreclosure
d. All of the above
10. The parties to a land contract are the:
a. mortgagor and mortgageeb. landor and landee
c. trustor and trusteed. vendor and vendee
11. With a promissory note, the loan amount is called the:
a. principal b. interest
c. due and payable claused. secured capital
12. A document stating that the debt secured by the deed of trust has been discharged is called a:
a. promissory noteb. full reconveyance
c. partial reconveyanced. notice of completion
13. When a new owner assumes an existing lien:
a. the new owner takes responsibility for the lien
b. the former owner is still responsible for the lien
c. the former owner has no responsibility for any deficiency judgment
d. the new owner cannot lose the property to foreclosure
14. Acceptance of a transfer of ownership must take place:
a. in the presence of two witnesses
b. in the county where the property is located
c. within 48 hours of the offer
d. while the one granting is alive
15. A standard title insurance policy covers:
a. latent title defectsb. recorded encumbrances not listed as exceptions
c. marketable titled. all of the above
16. A promissory note that includes periodic payments of interest only is called a(n):
a. installment noteb. balloon payment note
c. straight noted. amortized note
17. A power of sale clause:
a. allows the trustor to sell the property anytime
b. empowers the beneficiary to sell the property
c. allows the trustee to sell the property in case of default
18. When a borrower defaults and the lender has the right to declare the entire balance due immediately, the loan has a(n):
a. default interest rate clauseb. right to collect clause
c. acceleration claused. demand clause
19. To start the foreclosure process, the beneficiary asks the trustee to record a:
a. belief of abandonmentb. notice of default
c. request for notice of defaultd. default judgment
20. The government's power to take private property for public use is called:
a. police powerb. eminent domain
c. lis pendinsd. selective zoning
21. The only way to voluntarily transfer property is by:
a. deedb. will
c. both a and bd. neither a nor b
22. In California, a deed is valid if it:
a. is in writingb. includes words of conveyance
c. names an identifiable and living granteed. all of the above
23. A grantor must intend to surrender control and transfer title. This is called:
a. valid transferb. donative intent
c. transfer without recoursed. transfer intent
24. The two types of deeds most frequently used in California are the:
a. grant deed and warranty deedb. grant deed and quitclaim deed
c. grant deed and conveyance deedd. grant deed and sheriff's deed
25. A quitclaim deed conveys:
a. after-acquired title
b. all interest in the property
c. only the interest that the grantor has when the deed is executed
d. nothing
26. A person who makes out a will is called the:
a. legator or legatrixb. testator or testatrix
c. executor or executrixd. devisor or devisrix
27. Someone who dies has NOT left a will.
a. intestateb. intrastate
c. interstated. intestable
28. is the process by which possession and use of property can mature into title to the property.
a. Quiet possessionb. Eminent domain
c. Condemnationd. Adverse possession
29. The is when the documents transferring title from the seller to the buyer will be delivered and recorded.
a. escrow dateb. termination date
c. closing dated. finalizing date
30. Which of the following is necessary for a valid escrow to exist?
a. An enforceable contractb. Relinquishment of control
c. A valid deedd. All of the above
31. Suppose the buyer and seller sign a deposit receipt and later sign escrow instructions but the two don't match. Which one will generally be followed?
a. The escrow instructions
b. The deposit receipt instructions
c. Depends on whether it's northern or southern California
d. Neither. A new agreement will have to be drawn up.
32. Which of the following is a way in which an escrow may be terminated?
a. Mutual agreementb. Expiration
c. Defaultd. Any of the above
34. The unauthorized transfer or use of another person's money or property is a tort called:
a. conversionb. relation back
c. collusiond. misappropriation
35. The "purchase price" appears on the settlement statement as a:
a. credit to the buyerb. debit to the buyer
c. debit to the sellerd. it doesn't appear on the settlement statement
36.A valid deed requires
a.consideration.c.a date.
b.witnesses.d.delivery.
37.The following are requirements of a valid deed, except
a.recording.
b.writing.
c.signed by grantor.
d.clear property description.
38.Which deed would convey after-acquired title?
a.Warranty deedc.Quitclaim deed
b.Grant deedd.Sheriff's deed
39.Which of the following would make a deed voidable?
a.Forgery
b.Grantor is an unemancipated minor
c.Failure of delivery
d.Undue influence
40.Adverse possession requires all, except
a.payment of taxes.
b.living on the property.
c.open, notorious and hostile possession.
d.five years' continuous and uninterrupted use.
41.The following does not pertain to eminent domain:
a.An exercise of police power
b.Compensation for interest taken
c.The right to challenge the value in the courts
d.Applies to fee interests as well as to easements
42.The government took 140 acres of farm land from Jones under the power of eminent domain. Jones was left with 40 acres, which he feels now has a reduced value. Jones would likely bring an action asking for
a.inverse condemnation.c. dedication.
b.severance damage.d. escheat proceedings.
43.A requirement of a negotiable instrument is not that it be
a.payable to bearer only.
b.an unconditional promise.
c.a sum certain in money.
d.signed by the maker.
44.Real defenses that a maker can raise against a holder in due course include all of the following, except
a.forgery.c. illegality.
b.prior payment.d. incapacity.
45.A similarity between mortgages and trust deeds is that
a.they are both two-party instruments.
b.the borrower holds title and a lien is given for security.
c.both hypothecate the property.
d.the redemption rights are identical.
46.A lender would be likely to agree to accept a deed in lieu of foreclosure if the mortgage or trust deed contained a(n)
a.subordination clause.c. assignment of rents.
b.antimerger clause.d. prepayment penalty.
47."Naked legal title" would be held by a
a.vendee under a land contract.
b.mortgagee.
c.trustor.
d.trustee.
48.A real property sales contract must include a(n)
a.subordination clause
b.due-on-sale clause.
c.legal description.
d.one-year redemption period.
49.Obligatory advances refer to
a.construction loans.c. advance-fee brokerage.
b.prepayment penalties.d. prepaid rents.
50.The Real Estate Settlement Procedures Act applies to
a.commercial loans.
b.loans for vacant land.
c.junior liens.
d.first mortgages and trust deeds.
51.The act that specifically prohibits discrimination because a person's income comes from public assistance, is the
a.Equal Credit Opportunity Act.
b.Fair Credit Reporting Act.
c.Truth-In-Lending Act.
d.RESPA.
52.Brokers are required to inform the buyer and seller of the final selling price within one month of closing. They seldom do so because the
a.escrow provides this information.
b.buyer and seller know this from their purchase agreement.
c.information is provided by the title insurance carrier.
d.information is provided in the preliminary title report.
53.A history of title showing every recorded document would be a(n)
a.abstract of title.
b.preliminary title report.
c.standard policy of title insurance.
d.extended policy of title insurance.
54.An offer to issue a title policy subject to stated conditions would be a(n)
a.amendment to the escrow instructions.
b.preliminary title report.
c.abstract of title.
d.interpleader action.
55.The standard policy of title insurance covers all, except
a.lack of capacity of a grantor.
b.failure of delivery of a prior deed.
c.rights of parties in possession.
d.undisclosed spousal interests.
56.An extended coverage policy of title insurance does not provide protection for
a.defects covered by a standard policy.
b.zoning restrictions.
c.forged documents.
d.defects that would be revealed by a survey.
- An ALTA-R title insurance policy costs more in California than
- CLTA policy.
b. ALTA policy.
- WLTA policy.
- None of the above.
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