Virginia Real Estate Salesperson Exam — All Questions
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Two people own a property as joint tenants with right of survivorship. When one owner dies, that owner's share:
- a.Passes to the deceased owner's heirs through probate
- b.Automatically passes to the surviving joint tenant✓
- c.Reverts to the state through escheat
- d.Is divided among all creditors first
Joint tenancy includes the right of survivorship, so a deceased joint tenant's interest passes automatically to the surviving joint tenant(s) outside of probate. In a tenancy in common, by contrast, a share passes to the deceased owner's heirs.
A landowner wants to build a structure that does not comply with the current zoning setback requirements. To obtain permission for this specific deviation, the owner would typically apply for a:
- a.Building permit
- b.Conditional use permit
- c.Variance✓
- d.Certificate of occupancy
A variance permits a specific deviation from zoning requirements, usually because strict application would cause an unnecessary hardship. A conditional use permit allows a use otherwise not permitted in a zone; a building permit and certificate of occupancy address construction and readiness for use.
Which appraisal principle holds that the value of a property tends to be set by the cost of acquiring an equally desirable substitute?
- a.Substitution✓
- b.Anticipation
- c.Conformity
- d.Contribution
The principle of substitution states that a buyer will pay no more for a property than the cost of an equally desirable substitute. It underlies the sales comparison approach. Anticipation relates to expected future benefits; conformity to compatibility with surroundings; contribution to the value added by a component.
An appraiser estimates value by subtracting accrued depreciation from the current cost to rebuild the improvements, then adding land value. This is the:
- a.Sales comparison approach
- b.Income approach
- c.Gross rent multiplier method
- d.Cost approach✓
The cost approach estimates value as land value plus the current cost to build the improvements new, minus accrued depreciation. It is most useful for new or special-purpose properties where comparable sales are scarce.
In a deed of trust, which party holds legal title to the property as security until the loan is repaid?
- a.The trustor (borrower)
- b.The trustee✓
- c.The beneficiary (lender)
- d.The county recorder
In a deed of trust there are three parties: the trustor (borrower), the beneficiary (lender), and a neutral trustee who holds legal title as security and can conduct a nonjudicial foreclosure sale if the borrower defaults.
A federal law requiring lenders to disclose the annual percentage rate and total finance charges so consumers can compare credit costs is the:
- a.Real Estate Settlement Procedures Act (RESPA)
- b.Equal Credit Opportunity Act (ECOA)
- c.Truth in Lending Act (TILA)✓
- d.Fair Credit Reporting Act (FCRA)
The Truth in Lending Act (Regulation Z) requires lenders to disclose the annual percentage rate (APR), finance charges, and other credit terms so borrowers can compare loans. RESPA governs settlement costs; ECOA prohibits credit discrimination.
A seller receives an offer and responds by changing the closing date and price, then signing. This response is a:
- a.Counteroffer that terminates the original offer✓
- b.Binding acceptance of the original offer
- c.Void contract
- d.Unilateral contract
Changing terms and returning the document is a counteroffer, which rejects and terminates the original offer and creates a new offer that the original offeror may accept or reject. Acceptance must match the offer exactly to form a contract.
The legal requirement that contracts for the sale of real estate be in writing to be enforceable comes from the:
- a.Doctrine of laches
- b.Parol evidence rule
- c.Rule against perpetuities
- d.Statute of frauds✓
The statute of frauds requires certain contracts, including those for the sale of an interest in real estate, to be in writing and signed to be enforceable. The parol evidence rule limits use of outside evidence to change a written contract.
An agent learns that the seller-client is willing to accept far less than the listing price. Which fiduciary duty requires the agent to keep this from the buyer?
- a.Accounting
- b.Obedience
- c.Confidentiality✓
- d.Disclosure
The duty of confidentiality requires the agent to protect the client's private information, such as the lowest price the seller will accept. Disclosing that to the buyer would harm the client's bargaining position and breach the agent's duty.
A licensee assists a buyer and a seller in a transaction but does not represent either as a fiduciary. This arrangement is best described as:
- a.Dual agency
- b.An independent (non-agent) or transaction relationship✓
- c.Subagency
- d.Universal agency
When a licensee helps parties complete a transaction without representing either as an agent, the licensee acts as an independent or transaction-type intermediary, providing services without owing full fiduciary duties. Dual agency, by contrast, means representing both parties as clients.
Under federal law, for a home built in 1975 the seller must provide the buyer with:
- a.A lead-based paint disclosure and EPA pamphlet✓
- b.A radon mitigation certificate
- c.A flood insurance policy
- d.A termite bond
Federal law requires that sellers and landlords of target housing built before 1978 provide a lead-based paint disclosure, the EPA lead hazard pamphlet, and an opportunity for the buyer to conduct a lead inspection. A 1975 home is covered.
Recording a deed in the public land records primarily serves to:
- a.Transfer ownership from grantor to grantee
- b.Pay the property taxes due
- c.Give constructive notice of the ownership interest and establish priority✓
- d.Guarantee the property is free of physical defects
Recording gives constructive notice to the world of the grantee's interest and establishes priority against later claims. Title actually transfers when the deed is delivered and accepted; recording protects that interest but is not what creates the transfer.
A licensee tells prospective buyers of a particular background that a certain neighborhood 'would be a better fit for them' and steers them away from others. This practice is called:
- a.Farming
- b.Puffing
- c.Novation
- d.Steering✓
Steering is directing prospective buyers toward or away from particular neighborhoods based on a protected characteristic. It violates fair housing law. Puffing is nonfactual sales talk; novation substitutes a new contract or party.
A broker must generally keep a client's earnest money deposit in a:
- a.Personal money market fund
- b.Separate escrow or trust account✓
- c.Petty cash box at the office
- d.Joint account with the seller
Client funds such as earnest money must be held in a separate escrow or trust account, kept apart from the broker's own operating and personal funds. Mixing them (commingling) is a serious license law violation.
A lease in which the tenant pays a base rent plus a share of the property taxes, insurance, and maintenance is known as a:
- a.Net lease✓
- b.Gross lease
- c.Ground lease
- d.Percentage lease that ignores expenses
In a net lease the tenant pays base rent plus some or all of the property's operating expenses such as taxes, insurance, and maintenance. In a gross lease the landlord pays those operating expenses out of the rent.
A parcel measures 200 feet by 218 feet. Approximately how many acres is this parcel (1 acre = 43,560 square feet)?
- a.0.5 acres
- b.0.75 acres
- c.1.0 acre✓
- d.2.0 acres
Area = 200 x 218 = 43,600 square feet. Dividing by 43,560 square feet per acre gives about 1.0 acre.
Real estate licensees in Virginia are regulated by the Virginia Real Estate Board, which operates under which state department?
- a.The Virginia Department of Housing
- b.The Department of Professional and Occupational Regulation (DPOR)✓
- c.The Federal Housing Finance Agency
- d.The Virginia Department of Taxation
The Virginia Real Estate Board is one of the regulatory boards within the Department of Professional and Occupational Regulation (DPOR). The Board licenses salespersons and brokers and enforces Virginia real estate law and regulations.
In Virginia, a real estate salesperson must conduct licensed activity:
- a.Independently, without any broker
- b.Under a temporary permit only
- c.For any broker who pays the most
- d.Under the supervision of a licensed broker with whom the salesperson is affiliated✓
A Virginia salesperson must be affiliated with and supervised by a principal or supervising broker. The broker is responsible for the salesperson's activity and for handling escrow funds and records; a salesperson may not operate independently.
Virginia law generally requires that a brokerage relationship between a licensee and a client be:
- a.Established in a written brokerage agreement✓
- b.Only oral to be valid
- c.Automatically dual agency
- d.Free of any disclosure
Virginia requires brokerage (agency) relationships to be set out in a written agreement specifying the services and duties. Licensees must also disclose their brokerage relationship to the other party in a transaction so everyone understands who represents whom.
Virginia's Residential Property Disclosure Act is best described as a system in which:
- a.The seller warrants the property is defect-free
- b.The seller must repair all defects before closing
- c.The seller provides a disclosure statement and buyers are advised to exercise due diligence and inspect✓
- d.No disclosure of any kind is allowed
Virginia follows a buyer-beware approach: under the Residential Property Disclosure Act the seller provides a disclosure statement notifying buyers that the property is sold as is with respect to certain matters and that buyers should exercise due diligence, including obtaining inspections.
When a Virginia broker holds earnest money in escrow, the broker must:
- a.Deposit it into the broker's personal account
- b.Place it in a separate escrow account and account for it accurately✓
- c.Give it to the seller immediately
- d.Keep it in cash at the closing table
Virginia licensees must place client escrow funds, such as earnest money, into a separate escrow account and maintain accurate records, disbursing the funds only as the contract and law allow. Commingling or converting these funds is prohibited.
In many Virginia residential closings, the settlement is conducted by:
- a.The buyer alone with no third party
- b.A real estate appraiser
- c.The listing agent personally holding all funds
- d.A settlement agent or attorney who handles the closing and disburses funds✓
Virginia closings are commonly handled by a licensed settlement agent or a real estate attorney who prepares documents, handles the escrow and title work, and disburses funds. This neutral party helps ensure the transaction is completed correctly.
How many hours of approved prelicensing education must a Virginia real estate salesperson applicant complete?
- a.60 hours✓
- b.24 hours
- c.90 hours
- d.No education is required
Virginia requires 60 hours of approved prelicensing education for salesperson applicants. Applicants must also be at least 18, pass the licensing exam, and meet character requirements.
A newly licensed Virginia salesperson is generally required to complete additional post-license education within the first year of licensure. This requirement helps ensure new licensees:
- a.Can skip all future continuing education
- b.Never have to renew
- c.Gain practical knowledge shortly after entering the profession✓
- d.Become brokers automatically
Virginia requires new salespersons to complete post-license education (30 hours) during their first year of licensure. This builds on prelicensing education with practical, current knowledge. It is separate from the ongoing continuing education required at each renewal.