Real estate Illinois 1-25 test

1. Which two documents are necessary to establish a legally binding mortgage loan?

• A. Promissory note and deed of trust
• B. Sales contract and mortgage agreement
• C. Title insurance and appraisal report
• D. Warranty deed and lease agreement

2. If a buyer defaults on a sales contract after providing $10,000 as earnest money for a $200,000 property, what can the seller do with the $10,000?

• A. Return the entire amount to the buyer.
• B. Keep the entire amount as compensation.
• C. Deduct any incurred expenses and return the remaining amount.
• D. Distribute the money among the real estate agents u involved.

3. Surface Rights, Air Rights, and Subsurface Rights are all rights that can be sold by a property owner while still retaining the property itself. These rights are known as:

• A. Severable Rights
• B. Littoral Rights
• C. Owner's Rights
• D. Riparian Rights

4. When an easement allows the use of a neighboring property which automatically transfers upon the sale of either dominant or servient property, it is called what type of easement?

• A. Easement by Prescription
• B. Easement Appurtenant
• C. Easement in Gross
• D. Easement of Utility

5. In real estate, what is the closest meaning to the term "quieting a title"?

• A. Clearing any liens or encumbrances on a property.
• B. Transferring ownership from the seller to the buyer.
• C. Resolving disputes over property boundaries.
• D. Conducting a thorough property inspection.

6. What is the highest form of land ownership which includes the full and complete bundle of property rights?

• A. Fee Simple Defeasible

• B. Fee Simple Determinable
• C. Fee Simple Condition Subsequent
• D. Fee Simple Absolute

7. If your broker sells a triangular parcel of land for $750 an acre, and your commission rate is 8%, what will be your commission if the land has a base length of 1,200 feet and a height of 700 feet?

• A. $578.51
• B. $1,680.20
• C. $2,520.05
• D. $3,360

8. Tom is constructing a new house valued at $100,000. Given that the average property value of his surrounding neighbors is $225,000, which principle suggests that Tom will experience a positive effect on his property value?

• A. Principle of Regression
• B. Principle of Progression
• C. Principle of Substitution
• D. Principle of Contribution

9. Bob Jones, who lacks a real estate license, hires Sally Salesperson to sell his property. During Sally's absence, Bob shows the property, provides price quotations, and accepts deposits. What are the implications of Bob's actions?

• A. Bob's actions are legal as long as Sally consents.
• B. Bob's actions are illegal and can lead to legal consequences.
• C. Bob's actions are permissible if he is a property owner.
• D. Bob's actions are acceptable as long as he doesn't sign any contracts.

10. What is the general purpose for cities to require building permits?

• A. Permit fees are income for the city
• B. Control the amount of building allowed
• C. To supersede deed restrictions
• D. To require a minimum level of construction standards