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Real Estate

TEST 9

admin 2019.03.05 21:12 Views : 2699

1 of 10 - John and Jane Van Horn are buying their first home from the Simpson family. ABC Escrow will be the closing agent for both the Van Horns and Simpsons. Which of the three is considered the neutral party in this real estate transaction?
The Van Horns are the neutral party; the Simpsons are the sellers; ABC Escrow is the lender.
The Simpsons are the neutral party; the Van Horns are the buyers; ABC Escrow is the lender.
 
ABC Escrow is the neutral party; the Van Horns are the buyers; the Simpsons are the sellers.
Both the Van Horns and the Simpsons are the neutral parties in the transaction. ABC Escrow is the lender.
You answered correctly
2 of 10 - XYZ Escrow has been turned down in its application for an escrow license. What could be the reasoning behind the denial of the license to XYZ?
XYZ Escrow could not prove it was financially solvent and was unable to furnish a surety bond of at least $100,000.
 
XYZ Escrow could not prove it was financially solvent and was unable to furnish a surety bond of at least $25,000, or more, based upon the yearly average trust obligations.
XYZ Escrow placed funds in a trust account that was exempt from execution or attachment.
XYZ Escrow could not prove it was financially solvent and furnish bonds of indemnification for all employees of at least $25,000.
You answered correctly
3 of 10 - The escrow instructions in the Van Horn - Simpson transaction are deemed unavailable to the Simpsons. If instructions are confidential, and ABC Escrow is a dual agency representing both parties, why are the instructions only known to the Van Horns, their real estate agent, and ABC Escrow?
The instructions are considered unilateral and only apply to the Van Horns.
The instructions are always only available to the buyer (grantee) and are of no consequence to the seller (grantor).
The bilateral instructions apply only to the Van Horns and therefore may be known only to the Van Horns, their agent and ABC Escrow.
 
The instructions are considered unilateral and apply only to the Van Horns; therefore they may be known only to the Van Horns, their agent and ABC Escrow.
You answered correctly
4 of 10 - Dan, a real estate agent, suggests an escrow holder to the Snyder family for their real estate transaction. Is this a prohibited activity in California?
If the Snyder family requests the information from Dan, and he has disclosed any interest he may have in the escrow company, then it is not prohibited.
If Dan has made his suggested escrow company a condition of the transaction, it is a prohibited activity.
If Dan has made the suggestion of an escrow company without a request of his client, it is not prohibited, just good customer service.
 
Both A and B
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5 of 10 - Johnel, of ABC Escrow, is beginning to work on the escrow procedures of the Van Horn - Simpson file. She prepares the instructions; orders the title search and report; requests new loan instructions and documents; negotiates the fee due ABC Escrow from the parties involved; and accepts the pest control report and other reports. Which of these procedures is prohibited?
Johnel should not be requesting new loan instructions and documents. That is confidential information not applicable to closing escrow.
The ordering of the title search and report is prohibited of an escrow company. It is a procedure that is handled by the sellers' closing representation.
 
Johnel should only be preparing the instructions and ordering the title search and report. All of the other procedures are not requirements of the escrow holder.
 
Johnel should not be negotiating the fee due ABC Escrow as part of escrow procedures. The buyer and seller negotiate between themselves who is responsible for paying the escrow holder's fee.
You answered incorrectly
The escrow agent does not decide or negotiate how much of the escrow company fee will be paid by each party to the transaction. In Southern California, the escrow service fees are usually split 50-50 between the buyer and seller, while in Northern California, the service fees are usually paid by the buyer. However, the parties may negotiate among themselves to decide who will pay how much.
6 of 10 - The Escrow Act, found in the California Financial Code, establishes two essential mandates for escrow validity. What are these mandates?
There must be a binding contract between buyer (grantor) and the seller (grantee); and there must be a conditional delivery of transfer instruments and funds to separate agencies.
There must be a binding contract between buyer (neutral party) and the seller (grantee); and there must be a conditional delivery of transfer instruments and funds to a grantor.
 
There must be a binding contract between buyer (grantee) and the seller (neutral party); and there must be a conditional delivery of transfer instruments and funds to a dual agency.
 
There must be a binding contract between buyer (grantee) and the seller (grantor); and there must be a conditional delivery of transfer instruments and funds to a neutral third party.
You answered incorrectly
For an escrow to be valid, there must be a binding contract between the buyer and seller that can appear in any legal form, and there must be the conditional delivery of transfer instruments and funds to a neutral third party.
7 of 10 - The Van Horns deposit funds with ABC Escrow as a requirement for the purchase of their new home. Who is the grantee and the third party, and what is the type of transaction?
 
The Van Horns are the grantees; and ABC Escrow the third party. This transaction constitutes appropriated closing funds.
 
The Van Horns are the grantees; and ABC Escrow the third party. This transaction constitutes escrow.
The Van Horns are the third party; and ABC Escrow the grantee. The transaction constitutes escrow.
The Van Horns are the grantees; and ABC Escrow the third party. This transaction constitutes proration.
You answered incorrectly
The grantee is the buyer, or the Van Horns, while the third party is the neutral escrow holder, or ABC Escrow. Depositing funds with an escrow holder is the beginning of the escrow process.
8 of 10 - XYZ Escrow has gone out of business. They committed one of THE violations of all violations of escrow holder regulations. What is the violation?
XYZ Escrow charged a fee for its services.
 
XYZ Escrow did not maintain the records and files of its clients. Due to poor record keeping, several escrow accounts at XYZ were overdrawn.
XYZ Escrow used forms at closing that were neither simple nor clear. In several instances, the closing of escrow was behind schedule and held up the completion of the real estate transaction.
XYZ Escrow Company submitted the required annual audit late to their CPA for an additional audit.
You answered correctly
9 of 10 - At the close of escrow, ABC Escrow divides up funds proportionately between the Van Horns and Simpsons. What is the process and what expenses does it include?
The process of dividing funds between parties is the rescinding of escrow. It includes both expenses that are prepaid by the seller and paid after closing by the buyer.
The process of dividing funds between parties is termination of escrow. It includes the expenses that both parties prepaid to the escrow holder.
 
The process of dividing funds between parties is proration. It includes both expenses that are prepaid by the seller and paid after closing by the buyer.
 
The process of dividing funds between parties is auditing escrow. It includes expenses of both parties granted to the escrow holder to secure the real estate transaction.
You answered incorrectly
Proration is the process in which expenses such as property taxes, interest, rent, and/or assessments are divided proportionately between the buyer and seller and includes items that are prepaid by the seller such as insurance or items that will be paid after closing by the buyer such as property taxes.
10 of 10 - The Van Horns (buyers) and the Simpsons (sellers) have closed escrow on their real estate transaction. Who handles the completion of the transaction and both parties' separate paperwork?
 
Both parties close the transaction with ABC Escrow, the dual agency, in which both parties are represented. ABC Escrow then changes to separate agency and also handles each parties separate paperwork.
Although ABC Escrow served as the dual agency representing both parties until escrow closed, the Van Horns and Simpsons change to separate agencies for the handling of final paperwork.
ABC Escrow closes escrow for the Van Horn family. The real estate listing agent closes escrow for the Simpson family. Both parties use an agreed upon title company, acting as a dual agency, to complete the transaction and final paperwork.
None of the above.
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