Question: Which lien is paid first in foreclosure?

Answer Options: A. Mechanic’s lien B. First-recorded mortgage C. Property-tax lien D. All equally.

Answer: C. Property-tax lien. 154

Question: Which valuation approach is best for a single-family home with many recent comparable sales?

Answer Options: A. AVM B. Cost C. Income D. Sales comparison.

Answer: D. Sales comparison approach. 155

Question: Who holds legal title under a deed of trust?

Answer Options: A. Trustor B. Beneficiary C. Title company D. Trustee.

Answer: D. Trustee. 156

Question: What disclosure duties apply to an “as-is” sale?

Answer Options: A. All known material defects must still be disclosed B. None C. Latent defects only D. Patent defects only.

Answer: A. All known material defects must still be disclosed. 157

Question: Which is a per se antitrust violation?

Answer Options: A. Repeat-client discount B. Flat-fee advertisement C. Refusing to co-list D. Two brokers agreeing on commission rates.

Answer: D. Two brokers agreeing on commission rates. 158

Question: What is the status of a verbal agreement to sell a vacant lot?

Answer Options: A. Unenforceable under the statute of frauds B. Valid but hard to prove C. Void for lack of consideration D. Voidable by seller.

Answer: A. Unenforceable under the statute of frauds. 159

Question: Which is least likely to violate habitability?

Answer Options: A. Broken dishwasher B. Exposed wiring C. No winter heat D. Sewage backups.

Answer: A. Broken dishwasher. 160

Question: A seller prepaid a $375 annual HOA fee and closes April 30 using a statutory year. What is the proration?

Answer Options: A. $125.02 credit seller/debit buyer B. $125.02 credit seller and $249.98 debit buyer C. $249.98 credit buyer/debit seller D. $249.98 credit seller/debit buyer.

Answer: D. $249.98 credit seller and $249.98 debit buyer. 161

Question: What agency results when the same brokerage represents both buyer and seller in the transaction?

Answer Options: A. Designated agency B. Dual agency C. Single agency D. Transaction brokerage.

Answer: B. Dual agency. 162

Question: A buyer sees that a neighbor’s fence may cross the property line. What should the agent recommend?

Answer Options: A. Speak directly with the neighbor B. Rely on adverse possession C. Ignore it D. Obtain a property survey.

Answer: D. Obtain a property survey. 163

Question: New streetlights benefit only the homes on one street. How will they most likely be funded?

Answer Options: A. Ad valorem taxes B. Building-code fee C. Variance D. Special assessment.

Answer: D. Special assessment. 164

Question: Sarah grants John a life estate measured by John’s life, with Emily receiving the property at his death. Identify the parties.

Answer Options: A. Emily/John/Sarah B. John/John/Emily C. John/Sarah/Emily D. Sarah/John/Emily.

Answer: B. Life tenant John; measuring life John; remainderman Emily. 165

Question: When does a purchase agreement become binding?

Answer Options: A. Buyer signs B. Earnest money is deposited C. Seller signs and acceptance is communicated D. Seller verbally accepts.

Answer: C. Seller signs and acceptance is communicated. 166

Question: Which is first substantive contact requiring agency disclosure?

Answer Options: A. Requesting a listing sheet B. Greeting at an open house C. Asking square footage D. Seller discusses motivation and timing during a listing appointment.

Answer: D. The seller discusses motivation and timing. 167