Question: A standard-coverage title policy does NOT protect against loss from:

Answer Options: A. Encroachment B. Forgery C. Grantor incapacity D. Undisclosed heirs.

Answer: A. Encroachment. 109

Question: Which is least likely to qualify as a short-sale hardship?

Answer Options: A. Catastrophic illness B. Expected future layoff C. Divorce D. Unaffordable ARM adjustment.

Answer: B. An expected future layoff. 110

Question: Who is protected by a mortgagee’s title policy?

Answer Options: A. Buyer B. Only the lender C. Buyer and lender D. Seller.

Answer: B. Only the lender. 111

Question: Beverly’s surname is misspelled on her deed. What deed may be used to correct the record?

Answer Options: A. Bargain-and-sale B. Quitclaim C. Referee’s D. Special warranty.

Answer: B. Quitclaim deed. 112

Question: Which is NOT involuntary alienation?

Answer Options: A. Condemnation B. Foreclosure C. Adverse possession D. Owner voluntarily gives a vacation home to a nurse.

Answer: D. The voluntary gift to the nurse. 113

Question: A deed states, “I hereby convey and warrant … to have and to hold forever.” What type is it?

Answer Options: A. General warranty B. Limited warranty C. Special warranty D. Unwarranted.

Answer: A. General warranty deed. 114

Question: Title to real property is conveyed when a deed is:

Answer Options: A. Acknowledged and recorded B. Delivered and accepted C. Granted and transferred D. Signed and delivered.

Answer: B. Delivered and accepted. 115

Question: What provides the best protection against title defects?

Answer Options: A. Abstract B. Certificate of title C. Title insurance D. Title report.

Answer: C. Title insurance. 116

Question: Why are real-estate instruments recorded in the county where the property is located?

Answer Options: A. Recording is always mandatory B. Broker commission depends on it C. Statute of frauds D. To provide constructive notice.

Answer: D. To provide constructive notice. 117

Question: A prior buyer’s unrecorded deed exists, and a later buyer saw that deed before purchasing. What notice did the later buyer have, and who has priority?

Answer Options: A. Actual notice prior buyer’s heirs have the right B. Actual notice later buyer retains the land C. Constructive notice prior heirs have the right D. Constructive notice later buyer retains the land.

Answer: A. Actual notice, and the prior buyer’s heirs have the right. 118

Question: Who signs the deed at settlement?

Answer Options: A. Buyer B. Seller C. Buyer and seller D. Seller and settlement officer.

Answer: B. Seller. 119

Question: If the seller’s debits exceed the seller’s credits, what does that mean?

Answer Options: A. Buyer gets a refund B. Buyer pays the difference C. Seller gets a refund D. Seller must bring money to settlement.

Answer: D. Seller must bring money to settlement. 120

Question: If the seller’s debits exceed the seller’s credits, what does that mean?

Answer Options: A. Buyer gets a refund B. Buyer pays the difference C. Seller gets a refund D. Seller must bring money to settlement.

Answer: D. Seller must bring money to settlement. 121

Question: How long before closing must the borrower receive the TRID Closing Disclosure?

Answer Options: A. Three business days B. Three calendar days C. Seven business days D. Seven calendar days.

Answer: A. Three business days. 122

Question: What is the purpose of Form 1099-S?

Answer Options: A. Final seller costs B. Broker commission C. Closing requirements D. Report seller proceeds to the IRS.

Answer: D. Report seller proceeds to the IRS. 123

Question: Which charge is not normally prorated?

Answer Options: A. Property taxes B. Recording fees C. HOA fees D. Utility bills.

Answer: B. Recording fees. 124

Question: Cash a buyer must bring to closing equals:

Answer Options: A. Buyer debits minus buyer credits B. Debits plus credits C. Seller credits minus debits D. All buyer debits.

Answer: A. Buyer debits minus buyer credits. 125

Question: A home warranty:

Answer Options: A. Guarantees an inspector’s findings B. Is always required for financing C. Helps cover repairs to major systems D. Eliminates disclosure duties.

Answer: C. Helps cover repairs to major systems. 126

Question: How is a $10,000 earnest-money deposit shown on the settlement statement?

Answer Options: A. Credit to buyer B. Credit to seller C. Debit to buyer D. Debit to seller.

Answer: A. Credit to buyer. 127

Question: A $200,000 sale has a 6% commission, $2,500 other costs, and a $93,000 loan payoff. How much does the seller receive?

Answer Options: A. $92,500 B. $95,000 C. $104,500 D. $185,500.

Answer: A. $92,500. 128

Question: A sale closes March 20; annual taxes are $3,450 paid in arrears; seller owns closing day; use 365 days. What is the proration?

Answer Options: A. $746.71 debit seller/credit buyer B. Reverse C. $2,703.29 debit seller D. Unequal entries.

Answer: A. $746.71 debit seller and $746.71 credit buyer. Property management and review matching sets 129