TEXAS REAL ESTATE PRINCIPLES 1 WITH
200 REAL EXAM QUESTIONS AND
CORRECT ANSWERS/ TREC REAL ESTATE
PRINCIPLES 1 LATEST EXAM 2024/25(NEW)
How many members does the Texas Real Estate Commission (TREC) consist of? -
ANSWER-9
The Texas Real Estate Commission does NOT have authority to: - ANSWER-
amend real estate laws
Which entity is given the authority to pass zoning laws? - ANSWER-Zoning Boards
The Texas Deceptive Trade Practices-Consumer Protection Act applies to what aspects of real estate? - ANSWER-Advertising, offering for sale, selling, or leasing of any real or personal property What is an agent's foremost duty following acceptance of an offer? - ANSWER-To submit the contract and the earnest money to the employing broker without delay
What's the penalty for violating the Sherman Antitrust Act? - ANSWER-Individual violators of the Sherman Act can be fined up to $350,000 and sentenced to up to 3 years in federal prison for each offense; corporations can be fined up to $10 million for each offense.
However, the Criminal Antitrust Penalty Enhancement and Reform Act of 2004 increased the maximum criminal penalty for individuals to 10 years' imprisonment and a $1 million fine, and the maximum penalty for corporations to a $100 million fine. 1 / 4
Broker Jed tells buyer Sam that when he signs his purchase agreement he must also purchase a subscription to Jed's monthly newsletter. What would you say about this? - ANSWER-This is a tie-in arrangement which is prohibited by the Sherman Antitrust Act.
How are mortgage brokers compensated? - ANSWER-By bringing borrowers and lenders together
Who is responsible for management of day-to-day operations? - ANSWER- property managers
What is the most important aspect for an investor looking for capital gains? - ANSWER-Finding properties that are available at below market prices in increasing markets
Why do many brokers restrict their business to representing either buyers or sellers exclusively? - ANSWER-Minimized conflicts of interest
TREC, as a state agency, is a member of which organization? - ANSWER-
ARELLO
What is the role of the inspectors? - ANSWER-To inspect property's condition
Why it is better to be a member of trade organizations? - ANSWER-Because trade organizations provide possibilities for professional development and communication channels, as well as it raises person's profile among the clients and the public
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Who may hire a broker? - ANSWER-seller, buyer, landlord or tenant
What is included into real estate business? - ANSWER-Every residence and business facility in the nation, as well as all the undeveloped land in the country
Payments from the trust account for claims based on judgments against a single licensee may not exceed a total of what amount? - ANSWER-$100,000
Why are the categories of real properties not absolute? - ANSWER-Because they often partially match with each other
Which of the following would be classified as a common use type property? - ANSWER-office
The Texas Uniform Condominium Act allows owners shares of common elements:
- ANSWER-but the common elements cannot be partitioned.
In what types of relationship have many brokers specialized in recent years? - ANSWER-Advisory services
When may the meaning of law be expanded? - ANSWER-When a court hands down a decision regarding a particular law
What is the function of the state governments? - ANSWER-To exert regional influence in the usage and environmental control of real estate within the state.
What is not included in the "real property" concept? - ANSWER-The bundle of rights associated with owning the chattels estate 3 / 4
When may the trade fixtures become the property of the landlord? - ANSWER- Through accession
What is the right that allows a property owner to mortgage a property as collateral for debt? - ANSWER-Right to encumber
Most basic homeowner policies do NOT provide coverage for: - ANSWER-Floods
Plumbing leaks and burst pipes in an unoccupied property: - ANSWER-require
additional coverage above basic homeowner's insurance
In the past, the Alternate Minimum Tax applied to: - ANSWER-small biz
Which agency identifies flood plain areas? - ANSWER-Federal Emergency Management Agency
What federal act allowed single persons to exclude up to $250,000 in real estate gains from taxation? - ANSWER-The Taxpayer Relief Act
Which of the following items is NOT a condo common element? - ANSWER- Interior unit walls
What is the term given to the tax owed when a property owner sells a home? - ANSWER-Capital Gains
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