State: Texas | Category: Real Estate | All tests in this Category:
Practice Test 1 Practice Test 21. Implied authority in Texas real estate agency is derived from:
Implied authority is the authority reasonably necessary to carry out the express authority; it's derived from the contract terms and standard industry practices.
2. In Texas, late fees are permitted if they are specified in the lease and there is no statutory cap on the amount.
Texas allows late fees if the amount or method is specified in the lease; there is no statewide cap on late fees.
3. Under Texas law, which action terminates an offer?
An offer can be terminated by rejection, lapse of time, or revocation by the offeror before acceptance. Once terminated, it cannot be accepted to form a contract.
4. Where are client funds in a Texas real estate transaction typically held?
Client funds (escrow or earnest money) must be deposited into a broker's trust/escrow account, separate from the licensee's personal or business funds.
5. The main purpose of a real estate appraisal is to determine:
The primary goal of a real estate appraisal is to determine the property's market value, which reflects the price it would likely sell for under typical market conditions.
6. Which of the following is primarily a residential mortgage lender in the U.S.?
Savings and loan associations (S&Ls) historically focus on residential mortgages, whereas commercial banks have broader lending portfolios.
7. Which loan is paid first in a foreclosure sale?
In foreclosure, loans are paid in order of priority. The first trust deed (senior loan) is paid before junior liens or second trust deeds.
8. Which lease type is most commonly associated with anchor tenants in a mall or large retail development?
Anchor tenants often operate under a percentage lease to align rent with store performance.
9. How many licensees may a broker designate to represent each party in designated agency?
In designated agency, the broker designates specific licensees to represent each party; typically one designated licensee per party, though more than one may be used in practice depending on firm policy.
10. A taxpayer in Texas who disagrees with the CAD's appraised value would typically first receive:
The CAD issues a Notice of Appraised Value (NOAV) to inform the taxpayer of the value and invite protest.
11. Which term refers to property rights that are transferred separately from the land itself?
Appurtenances are rights or interests that are attached to the land but can be transferred with it.
12. A deed states: 'To A, so long as the land is used for park purposes.' Which estate is created?
The language 'so long as' indicates a determinable estate that automatically reverts if the condition is violated.
13. Private mortgage insurance (PMI) protects the lender against:
PMI provides financial protection to lenders if a borrower defaults on a mortgage with a low down payment.
14. A property’s highest and best use is defined as:
Highest and best use refers to the use that is legally permissible, physically possible, financially feasible, and most productive, producing the maximum value for the property.
15. Conservation zoning is used to:
Conservation zoning focuses on protecting natural resources and environmental features.
16. In a triple-net (NNN) lease, the tenant is typically responsible for which costs?
Triple-net leases transfer most operating expenses to the tenant: property taxes, insurance, and maintenance.
17. The cost approach is most appropriate for valuing:
The cost approach works best for new or unique properties where comparable sales are limited. Older homes may have significant depreciation, making other approaches more reliable.
18. What does extraterritorial jurisdiction (ETJ) allow a Texas city to regulate?
ETJ gives a city regulatory authority beyond its corporate boundaries, within a distance set by statute and sometimes tied to population or charter.
19. Which of the following is a fiduciary duty owed by a Texas broker to a client?
Fiduciary duties include loyalty, obedience, disclosure, confidentiality, accounting, and skill and care. Self-dealing and conflicts of interest violate fiduciary duties.
20. True or False: A Texas real estate salesperson license may be activated only if the licensee is sponsored by a Texas-licensed broker.
In Texas, practice as a salesperson requires a sponsoring broker; an active license cannot operate independently.