California Escrow Practice Exam

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• Which statement best describes DSCR?
• The land that benefits from an easement is called the dominant estate.
• What is the entity that receives the borrower's payments called?
• Under California withholding, if applicable, how much must be withheld and to which agency?
• Members of the California State Bar who seek a real estate license are:
• An easement in gross has no dominant estate.
• The Statement of Identity is used to obtain which information?
• Which rule governs the forms escrow holders draw?
• What does title insurance primarily protect a property owner against?
• True easements may consist of rights that are not obvious, including which of the following?
• Which parties are protected by the Trustee Sale Guarantee (TSG)?
• Truth-in-Lending disclosures are provided to the borrower by
• Under the statute of frauds, which contracts must be in writing?
• Which option best expresses how PCOR relates to reassessment exclusions?
• The practice of adding to the estimated closing statement a surplus to the amount of funds necessary for the buyer to close escrow is called
• Rental prorations are usually based on which basis?
• The deed in lieu of foreclosure
• A clause in the lender's note that allows the lender to call the loan due and payable in the event of a transfer of title is alienation or
• What is a primary benefit of MERS to the escrow holder?
• Which two plans are referred to by HARP and HAMP under the Making Home Affordable Program?
• Under federal law, a booklet regarding lead-based paint must be provided to the buyer and the buyer has how many days to inspect for lead-based paint?
• In a rehabilitation project, the lender may allow the work after escrow closing if the escrow holder what?
• The lender requires tenants to verify their current rent terms using which document?
• A township is which of the following?
• Regulated lending institutions include which entities?
• The title report will show easements, including
• Mortgage insurance is required for all loans sold to Fannie Mae and Freddie Mac with loan-to-value ratios greater than what percentage?
• Which item would typically appear as a debit on the buyer's closing statement?
• Conditions that would NOT be covered under the CLTA policy include
• The character of property interests and private property rights in California can be traced back to which country?
• Under bulk sale procedures, the purpose of notifying the State Board of Equalization is to obtain which of the following?
• To be valid, grant deeds must be in writing, include the property description, contain conveying language, identify a grantee, and
• Under California withholding, which agency receives the withheld funds?
• After all conditions are satisfied and funding is approved, who initiates the funding request?
• What is the name of the title company's primary facility that stores copies of all public records from the county where the property is located?
• The Subdivision Map Act applies to the subdivision of land into
• RESPA provisions apply to lenders
• A short sale occurs at escrow closing when the seller's lender agrees to accept less for the loan payoff than the amount due. Which statement best describes this situation?
• Regarding truth-in-lending, what is the required waiting period after a rate increase of 0.125% or greater?
• The chain of title lists which items?
• The additional coverage offered by an ALTA policy includes which of the following?
• First half of California property taxes is due and delinquent if not paid by?
• The Natural Hazard Disclosure Statement is NOT required for which type of property?
• Which IRS schedule lists rental income and operating expenses for real estate properties?
• Which item is an example of an encumbrance?
• Which statement best describes when the Natural Hazard Disclosure Statement is required?
• The two categories of liquor licenses are New and Previously Issued.
• Under the Truth in Lending Act, which items must be disclosed before the borrower becomes obligated to receive loan funds?
• Escrow companies, other than broker-owned companies, are regulated by which department?
• The Statement of Information is used to aid the title company in performing which task?
• In the rectangular survey system, what is the basis for the creation of townships and sections?
• If only one party has signed bilateral escrow instructions, escrow
• Rental prorations are usually based on
• Bulk sales laws are designed to prevent buyers from defrauding which party?
• If the seller is a foreign person, what must the buyer do?
• Grant deed forms include
• What is the primary protection offered by a title policy in the escrow process?
• The Unruh Civil Rights Act is a state law prohibiting discrimination by
• Under the federal truth-in-lending (TIL) disclosure laws, if a borrower's interest rate increases by 0.125% or greater than first disclosed before the close of escrow, escrow may not close for how long after receipt of the new TIL?
• Independent escrow agents are required to possess liquid assets in the amount of?
• Which statement about a deed in lieu on the borrower's debt is true?
• MERS stands for?
• Which metric does the lender use to determine the maximum loan amount based on cash flow?
• The Subdivided Lands Act applies to subdivisions of five lots or more and provides for both a preliminary approval and a final approval, referred to as
• A preliminary title report may indicate items that must be resolved before the title policy may be issued.
• Bilateral escrow instructions are prepared at opening as a regional practice in which area?
• The U.S. rectangular survey system is described as:
• An estate for years is defined as which of the following?
• Probate is NOT required if title was held as
• Escrow agents may resolve disputes as impartial arbitrators.
• A common interest property is owned as which type of ownership?
• Which statement best defines an express contract?
• The take sheet describes which of the following?
• Prorations may be based on what?
• General qualifications for obtaining a California real estate license state that an applicant must be 18 years of age or older, and may be denied if they have a criminal conviction. Which option best reflects the law?
• Which statement best describes the relationship between the Subdivision Map Act and the Subdivided Lands Act?
• In all-cash purchase, escrow practices shift focus to which aspect?
• Which of the following is not a claimant under a mechanics' lien?
• Which instrument is used almost exclusively in California by lenders to secure real property loans?
• Information that may be necessary for the title officer to issue a preliminary title report might include
• FHA loans require that impound accounts be established for taxes and insurance
• Which term describes an agreement where the seller agrees not to compete?
• Under bulk sale law, within how many days must a claim be filed to be valid?
• Which document provides constructive notice of a security interest in personal property in bulk sale transactions?
• The trust deed is
• In a deed of trust foreclosure, who records the notice of default?
• In rehab financing, what does a hold-back typically fund?
• Lead-based paint disclosure requirements apply to properties built before which year?
• With a deed of trust, the lender begins the foreclosure process by instructing the trustee to file and record a notice of default in the county where the property is located and to mail a copy to all borrowers and to those who have requested such notice within
• The primary regulator for lending on residential housing in the United States is which department?
• Under Regulation Z, a creditor is defined as which of the following?
• To establish an easement by prescription, which statement is correct?
• Underwriting is defined as which of the following?
• Who must create a true easement?
• If the borrower's loan includes impounds, the closing statement shows 14 months' insurance.
• A master insurance policy would be obtained for which property type?
• What does the title plant primarily store?
• Covenants, conditions, and restrictions (CC&Rs) can apply to
• The chain of title includes which elements besides party names?
• Which description best fits an estate that ends with a termination date?
• To take the California real estate broker’s license exam, unless exempted, a candidate must have experience as a full-time licensed salesperson for:
• What is the purpose of using established forms in escrow documents under the bar treaty?
• In escrow, who acts as a neutral depository for documents and money for both principals?
• The preliminary title report indicates which of the following?
• FIRPTA stands for which term?
• ALTA policies cover matters disclosed by which methods?
• Claimants under a mechanic's lien are divided into which four groups?
• Which document represents the final approval in the Subdivided Lands Act?
• Which set correctly lists the five ways property may be acquired in California according to Civil Code Section 1000?
• Recording a document provides which type of notice?
• Under the Truth in Lending Act, the finance charge includes
• Which statement best describes dominant and servient tenements in an easement?
• The CLTA standard title policy
• Which statement best describes the take sheet?
• What is the contingency removal period in CAR contracts unless otherwise indicated?
• Which of the following is a position at an escrow company?
• In Southern California, who typically pays for the owner's title insurance policy?
• When all the lender's conditions have been satisfied and funding is approved by the lender, the person who initiates the request for funding is
• To find the sales price if the transfer tax is known, divide the transfer tax by $0.55, then multiply the result by $500.
• Which items are included in information required for the escrow officer to prepare a complete and accurate escrow instruction?
• What basic information is included in escrow instructions?
• Which document would you expect to find in a title report that defines ongoing restrictions on property use?
• The borrower must be given a three-day right of rescission for
• The Federal Housing Administration was established by which act?
• Background checks are required for all independent escrow company personnel with no exceptions. EXCEPT which role?
• The document that provides constructive notice for the security instrument involving personal property in a bulk sale is the California UCC-1.
• The two basic groups of liquor licenses are on-sale and off-sale.
• If a CAR Purchase Agreement is used, the typical instruction at opening is which?
• A quitclaim deed
• What is the term for a grant deposited by the grantor with a third person and delivered on performance of a condition?
• The buyers' hazard insurance standard coverage includes which of the following?
• Using the Statement of Information (SI), the title searcher performs which type of run?
• Profit á prendre refers to which concept in easement law?
• California property tax year begins?
• What does YSP stand for in real estate financing discussions?
• The act that established FHA was which of the following?
• California's good funds law provides that
• Which statement about liquor license categorization is true?
• To be valid, effective, and enforceable, a contract must include which elements?
• The loan underwriter's approval letter may require additional conditions that must be satisfied before the loan may close and that include
• Releasing the buyer's deposit funds to the seller during escrow is?
• Property taxes in California become a lien on the property
• Spanish missions along the California coast were known at the time as which region?
• Zoning is an example of
• The government department responsible for promoting affordable housing and a discrimination-free environment is
• Under the general education requirements for a California real estate salesperson license, an applicant must:
• The buyer's consideration is shown on the closing statement as a
• Documentary transfer taxes are based on
• Southern California purchase escrow instructions are
• The largest investor in the secondary mortgage market is
• Southern California escrow practices usually focus on
• A deed in lieu of foreclosure accomplishes which of the following regarding the debt?
• In California real estate transactions, who is generally required to deliver a Transfer Disclosure Statement to the buyer?
• The second half of property taxes becomes due on
• Which statement about like-kind property is correct under Section 1031 rules?
• Which statement best describes an estate that has no fixed term?
• If the escrow holder is using the CAR Purchase Agreement and Joint Escrow Instructions for the escrow's opening information, what is the typical action by the escrow officer?
• The penalty for anyone who violates any provision of RESPA is
• The California foreclosure time line applies to which properties?
• If a buyer's loan payment will include a monthly reserve for hazard insurance, the escrow closing statement shows prepaid and impound insurance covering
• The structural pest control report includes which sections?
• Who must sign a grant deed to validate it?
• Under bulk sale rules, the time period to file a claim is which?
• Patent deeds involve transfers from which party to a private individual?
• Geographic coordinates locate a point on Earth by which method?
• The PCOR is associated with which aspect of property ownership transfer in California?
• In escrow, the holder serves as a neutral depository for documents and money for both principals. Which best describes this role?
• Who primarily directs the escrow process, guiding the actions of the escrow holder?
• All mortgage brokers in California must be licensed by which authorities?
• The CLTA standard title policy is
• For loans sold to Fannie Mae or Freddie Mac, mortgage insurance is required when the loan-to-value ratio exceeds
• The title company becomes involved in facilitating title protection to the lender using a deed of trust through the
• CC&Rs can apply to which forms of property?
• An apartment loan's loan-to-value (LTV) ratio may be reduced by which factors?
• Under bulk sale notice requirements, if the buyer fails to comply, the buyer is liable for damages
• An all-inclusive deed of trust is considered which type of deed of trust?
• Which of the following would be shown as a credit on the buyer's closing statement?
• For a For-Sale-By-Owner escrow in which the principals do not have a contract, what is required of the escrow?
• Which statement about a bilateral contract is true?
• An estate at will has which characteristic?
• Background checks are required for which group among independent escrow personnel?
• Eminent domain is
• An ALTA extended coverage loan policy differs from the standard coverage policy by offering
• Bilateral escrow instructions at opening are a customary practice in which region?
• Prepay penalties for commercial real estate loans may include which of the following?
• A patent deed transfers land from which party to a private individual?
• The statement of identity captures which information?
• The borrower obtaining an FHA loan cannot pay which of the following?
• What is the practical effect of recording a document in real property transactions?
• The TSG provides an indemnification for the consequences of any title record error in the foreclosure proceeding and protects the
• Which items are typically required by a lender when financing a multifamily property?
• The Statement of Information or Statement of Identity serves what purpose?
• Title policies provide financial protection to the buyer who suffers damages due to a faulty title search. Which statement describes this protection most accurately?
• Which statement best describes ALTA extended coverage compared to standard coverage?
• Documents that the escrow officer may prepare do NOT include?
• The value initially established by the PCOR is called the
• Items prepaid by the buyer or to be advanced to the buyer would be shown as a credit on the buyer's statement and may include
• A bilateral contract occurs when a promise to perform is made by one party and what occurs?
• The three-day right of rescission applies to which loan type?
• If the exchangor buys a replacement property before selling the property to be relinquished, the exchange is called a
• Bulk sale laws primarily protect which party in a sale from fraud?
• In a refinancing for an apartment building, which IRS form lists rental income and itemized operating expenses?
• The largest and BEST known investor in the secondary mortgage market is which entity?
• Under California Buyer's Choice Act, a violator who obtained property through foreclosure may be subject to damages of:
• Trust deeds transfer title only to which type?
• Debits would reflect the buyer's
• Documentary transfer tax is determined by which components?
• Which statement about the PCOR is true?
• Which statements about the preliminary title report are accurate?
• Title policies are written on the basis of public records and other records that impart which type of notice?
• Which statement about the creation of a true easement is accurate?
• Which of the following is NOT a method of acquiring property in California?
• The escrow holder must retain general escrow instructions under the law for how many years?
• Grant deed forms include
• Encumbrances against a property consist of
• Property is considered in which two categories?
• The government agency responsible today for promoting adequate and affordable housing, economic opportunity, and a suitable living environment free from discrimination is which entity?
• Reserves of regulated lenders are required in a specified percentage of the outstanding loan balance for which types of loans or properties?
• Estates in real property are categorized as which two types?
• Public records impart which type of notice that title policies rely on?
• If the buyer is going to assume the seller's existing loan, the escrow officer will order
• The California Association of REALTORS Purchase Agreement requires loan contingency to be removed in how many days?
• Fee simple estates are described as which?
• In a Section 1031 exchange, the term "like-kind" means which of the following?
• Which document is used to determine if a transfer of property might be eligible for exclusions to avoid reassessment?
• In a deed of trust foreclosure, who initiates the filing of the notice of default?
• A declared homestead sold and the proceeds reinvested in a new residence may be selected as a declared homestead if reinvested within how many months?
• The Preliminary Change of Ownership Report (PCOR) gives the assessor information for what purposes?
• Following the Mexican-American War, title to properties was established under which treaty?
• For properties with an HOA, which report is typically required by buyer and lender?
• A common interest property is owned by which arrangement?
• Intestate succession applies to one who died without a will.
• In a metes-and-bounds description, POB refers to which term?
• To qualify as a declared homestead after reinvestment, the new home must be selected within what period?
• Under truth-in-lending disclosure laws, if the disclosed rate increases by 0.125% or greater, the borrower must wait how many business days before signing?
• The Natural Hazard Disclosure Statement is required for which property type?
• Property is considered either real property or personal property. Which option correctly reflects this statement?
• Bulk sales laws require that escrow be opened for which type of transaction?
• An all-inclusive deed of trust is
• If a spelling error is discovered on a previously recorded deed, escrow may do which of the following?
• Lenders that use deeds of trust are called
• Which element is not universally required for a contract to be enforceable?
• A covenant not to compete is the term used for an agreement that the seller will not compete against the buyer by reopening at another location within a specified distance.
• Which statement about title insurance coverage is most accurate?
• A license is distinguishable from an easement in that it:
• Who typically requires an HOA certification report for a home with an HOA?
• A beneficiary acquiring property through foreclosure and who is the seller in an escrow transaction is not exempt from delivering which document to the buyer?
• Which item is generally exempt from the statute of frauds?
• Conditions that would NOT be covered under an ALTA policy include
• Under RESPA, who provides the HUD information booklet and the good-faith estimate before close of escrow?
• The transfer of title to real property is called
• In a delayed Section 1031 exchange, the exchangor has 45 days from closing to identify a replacement and 180 days to close the new property. Which option correctly describes this rule?
• As the principals direct the transaction, the escrow holder is more
• A lender typically requires which of the following to assess tenant obligations in a multifamily loan?
• Under California law, may a real estate broker nominate an escrow holder as a condition to a transaction?
• The title insurer reimburses the property owner for covered losses up to which amount?
• If the buyer of a liquor license owes taxes to the Franchise Tax Board, the Employment Development Department, or the Board of Equalization, the escrow holder must
• Under RESPA, the lender is required to provide the borrower with
• Which organization publishes the Purchase Agreement and Joint Escrow Instructions used in California real estate transactions?
• Which scenario can exempt an applicant from the broker two-out-of-five-years experience requirement for the broker license exam?
• How many years of experience must the independent escrow office manager have?
• A lender who discovers that the borrower's property has no access to a public street would be protected under
• The closing statement on a real estate transaction is typically prepared with which pair of bookkeeping columns?
• A contract that is valid but unenforceable if rejected by one party is called what?
• Which statement best describes the purpose of a title insurance policy?
• Estates in real property are categorized as which two classifications?
• Which is listed as an escrow position in the material?