Học Thi Real Estate License ở California: The role of Escrow and Title Insurance Companies Dat Hoang April 14, 2020 No Comments 1. On aclosing statement, due and unpaid taxes would be: both a and b a debit to the seller a credit to the buyer neither a nor b HintSince the buyer must pay the seller's obligation. 2. A home is sold on August 31, with taxes being prorated. the seller owes the buyer for three months' taxes the seller owes the buyer for two months' taxes the buyer owes the seller for three months' taxes the buyer owes the seller for two months' taxes HintTaxes are not yet due, so they are unpaid from June. 3. Which of the following will not terminate an escrow? none of these agreement of the principals the broker's order to terminate inability to meet a contingency HintThe broker is not a party to escrow. 4. A title insurance company is least likely to physically inspect property for: a standard policy an extended-coverage policy an ALTA policy none of these HintDoes not cover risks discoverable by inspection. 5. Recording costs on an escrow would be paid by: the party drafting the instrument the county recorder's office the broker the party receiving the instrument HintThe party giving the instrument pays for drafting. 6. A 30 day escrow cannot be completed during the set time. the escrow remains valid until completed both the seller and buyer must agree to an amendment of the escrow instructions or the escrow is canceled the broker can extend the escrow it is a perfect escrow 7. Escrow companies are primarily under the jurisdiction of the: none of these Corporations Commissioner Real Estate Commissioner State Banking Commissioner HintDepartment of Corporations. 8. Which of the following is not covered by an extended-coverage policy of title insurance? a forged deed a deed that was never delivered a mistake in property line defects known to the buyer 9. In the absence of a closing date, the escrow should close: escrow cannot close until a date is agreed upon within 30 days within 60 days within a reasonable period of time 10. Possesion in a real estate sale, in the absence of any aggreement, should be given: prior to close of escrow within a reasonable time within 30 days of close of escrow at close of escrow within 30 days of close of escrow 11. The closing statements the buyer and seller get from escrow: are acknowledged are identical are always different both a and b HintThey have different credits and debits. 12. An impound account would belong to: a trustee none of these a trustor a beneficiary HintIt contains prepaid taxes and insurance, which were paid by the trustor. 13. On an escrow the daily prorated charge for a three-year insurance policy costing $97.20 would be: none of these 11 cents 20 cents 9 cents HintDivide by 36, then by 30. 14. Title plant refers to all records relative to real estate transactions in a: city county subdivision township 15. A broker gets a deal into escrow. After all papers are signed, both the buyer and the seller die. The escrow agent should: continue with escrow return all monies and cancel escrow await the decision of the broker await the instructions of the heirs HintUnless representatives of the deceased agree to cancel. 16. A title company holding papers for an escrow is a(n): broker subagent none of these agent HintA dual agent of the buyer and the seller prior to closing. After closing, it has separate agency duties. 17. A preliminary title report: describes the property and encumbrances provides interim insurance until a policy can be issued can be used in lieu of an escrow is issued to the buyer after close of escrow HintAnd conditions of the policy the insurer will issue. 18. An item such as "liens to be assumed by buyer" would be found in a seller's closing statement under: the credit column assumption costs none of these the debit column HintBut is a buyer credit. 19. An escrow company may: none of these give rebates to brokers for sending business disregard instructions received from a broker after the escrow instructions are signed fill in blanks in the escrow instructions HintThe broker is not a party to escrow. 20. An escrow prorates based on ___ days in a year. 360 365 370 300 HintAnd 30 days in a month. 21. To obtain marketable title, a person who is claiming his or her interest under adverse possession could: start a quiet title action either b or c obtain a policy of title insurance obtain a quitclaim deed from the record owner 22. Title insurance is not available if: the deed does not mention consideration all of these the deed does not include a legal description the lender is not located within the state 23. The term binding contract and conditional delivery describes: none of these a perfect escrow a valid escrow a complete escrow 24. On a real estate closing statement, prepaid rent is always a: debit to the buyer credit to the seller none of these debit to the seller HintAnd a credit to buyer. 25. Closing is scheduled for May 20, 2012; the second property tax installment has been paid. On the buyer's closing statement, taxes are: a liability a credit an asset a debit HintTaxes are paid through June. 26. The usual way for a buyer to ensure that he or she is getting marketable title is to obtain: a warranty deed a policy of title insurance a grant deed an abstract 27. An escrow officer alters a deed after it has been signed to convey property other than agreed. none of these is true the deed conveys the property originally described, not the later modification the title remains with the grantor the grantee gets title, but escrow is liable to grantor for damages HintAlteration voids the deed. 28. Which of the following is not a credit in a seller's closing statement? none of these prepaid taxes a standard policy of title insurance prepaid insurance HintBut it could be a debit. 29. The signed escrow instructions disagree with the prior purchase contract. As to the disagreement, which of the following is true? the purchase contract prevails parol evidence is admissible to discover true intent the escrow instructions prevail the courts would have to decide what the agreement is HintEscrow is the later agreement. 30. Escrow would be automatically canceled by: the death of the seller the request of the broker the death of the buyer none of these 31. A buyer would be protected against a right of a party in possession by: a standard title insurance policy neither a nor b either a or b an extended-coverage title insurance policy 32. A standard policy of title insurance does not cover: an incompetent grantor incorrect marital status unrecorded liens a forged document HintIt covers liens of record. 33. A buyer would get the least protection from: a certificate of title a guarantee of title a standard policy of title insurance an abstract HintJust a recorded history. 34. Escrow closes on the 15th day of February (28 days). The seller receives $500 rent for the month of February. The seller: owes the buyer less than $250 owes the buyer more than $250 owes the buyer $250 keeps the entire $500 HintProrated based on a 30-day month. 35. Who has primary responsibility for reporting sale information to the IRS? the escrow agent the buyer the broker the seller HintReported on Form 1099. 36. In a buyer's closing statement, the selling price is: none of these a debit to the seller a credit to the buyer a debit to the buyer HintAnd a credit to the seller. 37. On a closing statement, an existing mortgage that is to be assumed by the buyer would be shown as: a debit to the buyer both b and c a debit to the seller a credit to the buyer 38. A buyer's escrow statement would not show: the amount in the seller's impound account the value of unused insurance unpaid taxes points to be paid by the seller HintThey would not affect the buyer. 39. The files of a title company of recorded documents on microfilms are known as: the Torrents title system a title plant none of these a grantor/grantee index 40. Which of the following, prorated, would be a credit on the seller's closing statement? prepaid insurance both a and b prepaid rents of tenants neither a nor b HintThe seller paid it in advance. 41. A seller delivers a grant deed to escrow after escrow instructions have been signed. He asks that it be returned to him so that he can have an attorney check it. the return of the deed constitutes rescission by the seller the escrow holder must return the deed if so instructed the request, to be honored, must be written the escrow holder cannot return the deed based on the seller's request HintBoth parties must agree. 42. Which of the following is false? a broker may sometimes act as an escrow escrow companies are under the jurisdiction of the Coporations Commissioner a broker may have a financial interest in an escrow company none of these is false HintAll are true. 43. A sale takes place on January 1. There is $1,800 in the impound account. Proration would be: half to the buyer after expenses none of these haft to the buyer, half to the seller all to the buyer HintThe impound account belongs to the seller, but taxes and insurance are prorated. 44. A buyer assumes a trust deed. On the buyer's closing statement, it would be shown as a: balance factor credit debit none of these HintIt balances against the sale price. 45. An extended-coverage policy of title insurance does not cover: incorrect survey encroachment zoning easements HintZoning is not covered by any policy. 46. An escrow agent is most likely to get into trouble if he or she: hold funds after close of escrow represents both parties engages in a double escrow accepts escrow instructions containing blanks to be filled in by him or her after escrow instructions are signed HintSpecifically prohibited. 47. The exact history of vonveyances and encumbrances affecting title to a property is called: a title report an abstract ownership a chain of title HintAbstract shows recorded history. 48. A broker can, without being licensed as an escrow, handle the escrows on transactions where he or she: any of these represents the seller represents the buyer acts as a principal 49. Which of the following may not engage in the escrow business? a foreign corporation a domestic corporation an individual who is not a real estate broker or attorney a bank HintAn escrow must be one of these or a corporation. 50. A fire insurance policy cost $360 for three years. Six-and-a-half months after the insurance policy is taken out, the building is sold, and the policy is assumed. On a closing statement. the buyer would be credited $65 the seller would be credited $295 and the buyer debited this amount the seller would be debited $65 the insurance will be split using a short rate HintPorated at $10 per month. 51. In an escrow statement, the term recurring costs pertains to: title insurance fees recording fees impound account items insurance prorations HintTaxes and insurance. 52. Impounds refers to: fixed rates of interest reserves indefeasible leases all monies held in escrow HintFor taxes and insurance. 53. The broker's commission is normally paid: when funds are deposited in escrow when escrow closes when the broker obtains a buyer ready, willing, and able to buy none of these HintBut is earned when the buyer's offer is accepted. 54. The Rebate Law: all of these prohibits brokers from rebating commissions to nonlicensees prohibits all finder's fees requires escrows to treat brokers like everyone else HintAlso prohitbits escrow kickbacks to agents. 55. A standard policy of title insurance covers: encroachment incompetence of any of the parties the rights of the party in possession zoning restrictions HintInsures grantor competency.