Real Estate Management
Pre-Test Questions
Course Introduction
Real Estate Management explores the principles and practices involved in the administration, operation, and oversight of residential, commercial, and industrial properties. The course covers topics such as property valuation, leasing, tenant relations, maintenance, financial analysis, and legal and regulatory considerations. Students will gain insight into market dynamics, investment strategies, and risk management while developing skills necessary for effective decision-making in real estate operations. Through case studies and practical applications, this course prepares students to manage real estate assets efficiently and ethically in a dynamic and competitive industry.
Recommended Textbook
Real Estate Finance 9th Edition by John
P. Wiedemer
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16 Chapters
189 Verified Questions
189 Flashcards
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Page 2
Chapter 1: History and Background
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14 Flashcards
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Sample Questions
Q1) Bonds are sold in the financial market by corporations for the purpose of
A) raising equity cash
B) Borrowing money
C) Providing additional brokerage fees
D) Generating greater income
Answer: B
Q2) Which of the following is most descriptive of the primary market?
A) The loan origination market
B) Trading in second mortgages
C) The buying and selling of mortgage loans
D) The market created by Fannie Mae and Freddie Mac
Answer: A
Q3) After the recent financial crisis Fannie Mae and Freddie Mac were put into conservatorship and the new government agency that has responsibility for their oversight is:
A) Federal Reserve Bank
B) The Office of Federal Housing Enterprise Oversight
C) Federal Housing Finance Agency
D) Department of Housing and Urban Development
Answer: C
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Chapter 2: Money and Interest Rates
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11 Flashcards
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Sample Questions
Q1) When the Federal Reserve buys or sells government securities in the financial markets, it is called
A) Juggling the credit markets
B) Cycling the discount rate
C) Discounting the market rates
D) Open market operations
Answer: D
Q2) Monetary policies in this country are under the control of the
A) Office of Thrift Supervision
B) Secretary of the Treasury
C) Federal Reserve Bank Board
D) Federal Deposit Insurance Corporation
Answer: C
Q3) Usury can best be described as
A) Interest rates set by the federal government
B) Rates charged by unscrupulous lenders
C) Interest paid or received that exceeds state laws
D) Interest limitations based on religious beliefs
Answer: B
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Page 4
Chapter 3: Mortgage Money: Regulated Lenders
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12 Verified Questions
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Sample Questions
Q1) While differing to their chartering agencies and purposes, both savings association and saving banks are commonly referred to as
A) Banks
B) Long term depositor institutions
C) Thrifts
D) Banking societies
Answer: A
Q2) All life insurance companies are chartered and regulated by
A) The federal Life Insurance Commission
B) Various state and federal authorities
C) State commissions only
D) Are not regulated
Answer: C
Q3) Federal legislation in 1998 restored the right to membership in credit unions to A) Anyone solicited by credit unions
B) Those with a common bond plus those working for companies with less than 3,000 employees
C) All members of AARP
D) Anyone not challenged by a commercial bank
Answer: B
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Chapter 4: Other Primary Market Lenders
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12 Flashcards
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Sample Questions
Q1) Most RMBS issued by Fannie Mae and Freddie Mac being issued not being purchased by the Federal Reserve Bank is being financed by REIT's using the
A) Discount Window of the Federal Reserve Bank
B) Federal National Mortgage Conduit
C) The Federal Housing Administration
D) Public-Private Investment Program
Q2) While the distinction between mortgage bankers and brokers is diminishing, a full service mortgage banker means being capable of all the of the following EXCEPT
A) originating or negotiating a loan.
B) funding a loan at closing.
C) servicing a loan until pay off.
D) holding a loan in portfolio.
Q3) Automated underwriting means
A) used only by Internet operators
B) analysis of loan application by computer software programs that allow loan approval if justified
C) analysis of loan application by elimination of all human input
D) transmission of loan info via a computer
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Page 6
Chapter 5: Mortgage Money: the Secondary Market
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12 Verified Questions
12 Flashcards
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Sample Questions
Q1) If a discount is taken off the face value of a note, the result is
A) a decrease in the return to the note holder
B) no change in the return since the interest rate is unchanged
C) a higher market value for the note
D) an increase in the return to the note holder
Q2) A unit of measure when used as a real estate finance term amounting to one hundredth of one percent is:
A) One Discount Point
B) One Basis Point
C) A Fraction
D) One Point
Q3) As used in mortgage lending, yield means
A) the flexibility allowed in a mortgage loan.
B) to give priority to another.
C) the return of interest plus discount.
D) the interest earned on the loan.
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Chapter 6: The Mortgage Documents
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Sample Questions
Q1) The primary purpose for recording a mortgage instrument is to
A) establish its validity
B) comply with tax laws
C) give public notice of its existence
D) safeguard the document
Q2) When you hypothecate an asset it means that you as a borrower have:
A) signed a promissory note
B) given a deed in lieu of foreclosure
C) pledged an asset as collateral without giving up it use
D) assigned their debt to another while retaining liability
Q3) Which of the following folds the highest priority of claim if properly filed against property?
A) Property Taxes
B) First Mortgage Lien
C) Second Mortgage Lien
D) Homestead Claim
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Chapter 7: Mortgage Repayment Plans
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Sample Questions
Q1) In mortgage lending, the term "amortization" means
A) making monthly payments
B) the pay-off of a loan at maturity
C) periodic reduction of the principle balance
D) periodic payment of interest
Q2) Negative amortization, or an increase in the principal amount due each month, is most likely to be found in which of the following?
A) Adjustable Rate Mortgage
B) Growing Equity Mortgage
C) Pledged Account Mortgage
D) Graduated Payment Mortgage
Q3) A shared equity mortgage allows
A) the lender to share in any appreciation made by the property pledged
B) two or more parties to share property ownership and the mortgage obligation
C) one party to undertake the mortgage obligation and another to take or share ownership
D) a partial obligation on the mortgage commensurate with their ownership interest\
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Chapter 8: Federal Government Underwriting Programs
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12 Flashcards
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Sample Questions
Q1) Under FHA procedures, all of the following are considered prepaid items EXCEPT:
A) down payment
B) property taxes
C) hazard insurance
D) mortgage default insurance
Q2) Which of the following cash required to close rules apply to an FHA mortgage?
A) Cash required may be added to loan amount
B) 3.5% cash required may be cover by down payment plus closing costs
C) 3.5% cash must be paid as down payment
D) Only required down payment must be in cash
Q3) FHA loans originated on or after December 15, 1989 are restricted to which of the following assumption policies?
A) Freely assumable but seller remains liable
B) Cannot be assumed for first five years of mortgage obligation
C) New buyer must be approved by FHA prior to title transfer
D) No assumptions are permitted
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Chapter 9: Borrower Quali cation
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Sample Questions
Q1) The source of repayment of a home loan is expected to come from:
A) income derived from the property itself
B) additional borrowing
C) the personal income of the borrower
D) other rental income
Q2) The private mortgage insurance carrier and the amount of insurance coverage required are determined by the:
A) Mortgagor
B) Seller
C) Mortgagee
D) Real Estate Agent
Q3) The assistance given by a credit report to borrower qualification is primarily to:
A) verify the applicant's place of residence
B) show the applicant's payment record to other creditors
C) confirm employment and banking relations
D) disclose any liens against applicant's property
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11
Chapter 10: Property Analysis
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Sample Questions
Q1) Which of the following types of legal description is most commonly found in urban areas?
A) Geodetic or government survey
B) Metes and Bounds
C) General Survey
D) Lot and Block
Q2) Which FHA software technology allows a approved FHA seller/servicer to find a FHA approved appraiser?
A) Desktop Underwriter
B) FHA Connection
C) Loan Prospector
D) Uniform Appraisal Dataset
Q3) The principle of appraising that considers the amount of value that may be added by an improvement is
A) Substitution
B) Anticipation
C) Conformity
D) Contribution
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12
Chapter 11: Commercial Loans: Construction and Land Loans
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12 Flashcards
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Sample Questions
Q1) The top designation for a accountant preparing a financial statement is:
A) Certified Management Accountant
B) Certified Public Accountant
C) Federal Approved Accountant
D) Designated Accountant
Q2) The major difficulty in obtaining a raw land purchase loan is:
A) the land is hard for the lender to inspect
B) the value is difficult to determine
C) it is not certain that its value will increase
D) it produces no income while expenses like taxes and insurance continue
Q3) A construction loan can include all of the following conditions EXCEPT:
A) disbursement only after certain construction has been completed
B) a release of that portion of the collateral on which disbursement of funds has been made
C) a method of assuring the lender that money disbursed to a borrower/builder is used to pay a project's bills
D) a requirement for periodic inspection to assure the lender that all plans and specifications are being met
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Chapter 12: Commercial Building and Farm Loans
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12 Flashcards
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Sample Questions
Q1) When seeking funding which of the following is not one kinds of information that a religious institution facilities lender might feel was key?
A) Minimum of three years average adult worship attendance.
B) Annual contributions from each of the largest 15 donors for the previous year (the names of the donors are not usually required).
C) Annual salaries/income of ministerial staff
D) Cash on hand in building fund
Q2) Multifamily housing must comply with a 1988 amendment to Fair Housing Act that adds which of the following to the prohibition against discrimination?
A) Pets and other personality
B) Elderly persons
C) Citizenship and employment
D) Familial status and handicapped
Q3) Depreciation allowed for tax purposes is a percentage of the:
A) total value of the land and buildings
B) equity interest in the building
C) total value of the building
D) equity interest in the land
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14
Chapter 13: Other Financing Practices
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11 Flashcards
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Sample Questions
Q1) Which of the following is a FALSE statement in regard to refinancing a home loan?
A) Lenders are free to set their own requirements for refinancing a loan
B) Income tax laws may affect the savings in refinancing
C) A 2 percent reduction in interest rate is a profitable refinancing in every case
D) A major problem is the appraised value of the property may be less than the balance due on the existing mortgage loan
Q2) If a builder holds an unsubordinated leasehold interest in land, it means that a building constructed on the land
A) would pass to the landowner if the land rent is not paid
B) would pass to the mortgagee if the land rent is not paid
C) the builder would only forfeit ownership if the mortgage loan is not paid
D) would remain in possession of the builder as long as the land rent if paid
Q3) Which of the following is NOT an acceptable procedure for proving title to land?
A) An attorney's opinion based on research of an abstract
B) An accurate survey made by a state-licensed surveyor
C) Purchase of title insurance
D) A Torrens registration system
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Page 15
Chapter 14: Technology Advances in Mortgage Lending
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11 Flashcards
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Sample Questions
Q1) An ownership interest of one percent or more between parties involved with a CLO operation is called a "controlled business arrangement" and must be:
A) a required used of any affiliated company
B) disclosed to any consumer
C) prohibited to use an affiliated company
D) at least a 25 percent discount given by an affiliated company
Q2) Mortgage loan origination software must increasingly be compatible with:
A) Microsoft Excel
B) TurboTax
C) Third party originator web portals
D) Mortgagebot
Q3) Which of the following is NOT a loan classification with Freddie Mac's "Loan Prospector"?
A) Rejected
B) Accepted
C) Refer
D) Caution
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16
Chapter 15: Environmental Issues
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Sample Questions
Q1) The purpose of a Phase I Assessment as defined by CERCLA is to
A) determine if any prior use of the property would indicate the presence of environmental contamination
B) examine the property for existing contamination only on the surface
C) discover any existing contamination and determine methods of resolving the problem
D) provide the landowner with absolute protection against any subsequent liability
Q2) Lead poisoning can result from inhalation an/or ingestion of lead from all the following sources EXCEPT:
A) Emissions from internal combustion engines
B) Water passing through plastic pipes
C) Powdering or blistering paint in place prior to 1978
D) Household dust and soil around a house
Q3) Which of the following is NOT an economic reason for pursuing a Green Building design?
A) Energy savings of up to 50%
B) 69% fewer CO2 emissions
C) Worker productivity increases up to 15%
D) Up to 40% reduction in water use
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Chapter 16: Settlement Procedures
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Sample Questions
Q1) All of the following charges involved with the settlement of a residential mortgage loan must be paid at time of closing EXCEPT:
A) Prepaid principal
B) Property taxes
C) Hazard insurance premium
D) Prepaid interest
Q2) Which of the following is a prohibited practice as defined by RESPA requirements?
A) A listing broker splits the real estate commission with a selling broker
B) A lender refuses to accept an insurance company for coverage even though requested by the borrower
C) A seller requires the use of a specific title company as a condition of the sale
D) A selling broker provides the buyer/borrower with assistance in obtaining a loan in return for a fee
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