1. A property use that legally existed before a new zoning ordinance and is allowed to continue is a:
Answer & explanation
Answer: D. A legal nonconforming ('grandfathered') use predates the ordinance and may continue, usually with limits on expansion. A variance is permission to deviate from a current requirement.
2. Under the AAR Residential Resale Real Estate Purchase Contract, the seller must deliver the completed SPDS within how many days after contract acceptance?
Answer & explanation
Answer: B. The current AAR purchase contract requires the seller to deliver a completed SPDS within three days after contract acceptance. Five days is the deadline for the insurance claims history.
3. In a lease, the tenant holds a ____ estate and the landlord holds a ____.
Answer & explanation
Answer: D. The lessee has a leasehold (non-freehold) estate; the lessor retains the leased fee interest plus the reversion.
4. The principle that a property's value tends to be set by the cost of an equally desirable substitute is:
Answer & explanation
Answer: A. Substitution: a buyer will pay no more than the cost of an equally desirable alternative.
5. In general, a 'stigmatized' property refers to one:
Answer & explanation
Answer: B. Stigmatized properties are affected by events (crime, death) rather than physical condition; disclosure rules vary by state. (Well-established principle; not detailed in the course.)
6. In a mortgage, the borrower who pledges the property as security is the:
Answer & explanation
Answer: C. The mortgagor (borrower) gives the mortgage to the mortgagee (lender) in exchange for the loan.
7. Under the Code of Ethics, a REALTOR who wants to buy a property listed with his own firm must:
Answer & explanation
Answer: A. REALTORS must disclose in writing their licensed status and any interest when buying or selling property for themselves or family.
8. A timeshare that lets the owner use the property during a specific, set week each year is a:
Answer & explanation
Answer: D. Fixed-week timeshares assign the same week every year; floating weeks allow different weeks subject to availability.
9. Property taxes are paid in arrears (after the tax period). At a mid-year closing, the seller's share of unpaid taxes appears as:
Answer & explanation
Answer: B. When taxes are paid in arrears, the buyer will pay the full bill later, so the seller is charged (debit) and the buyer credited for the seller's portion.
10. When a tenant in common dies, that owner's share:
Answer & explanation
Answer: B. Tenancy in common has NO right of survivorship, so a deceased co-owner's interest passes by will or to heirs. Automatic passage to co-owners describes joint tenancy.
11. An investment property with NOI of $63,000 sells for $900,000. What is the capitalization rate?
Answer & explanation
Answer: C. Cap rate = NOI / value = $63,000 / $900,000 = 0.07 = 7%.
12. The seller of a rental property collected $1,800 rent for the month on the 1st. Closing is on the 10th, and the seller owns the day of closing (30-day month). What is the rent proration?
Answer & explanation
Answer: C. Daily rent = $1,800 / 30 = $60. Buyer owns days 11-30 = 20 days. 20 x $60 = $1,200, credited to the buyer because the seller collected rent for days the buyer will own.
13. A property manager receives a tenant's security deposit and advance rent. These funds must be deposited in the:
Answer & explanation
Answer: D. Money belonging to others goes into a trust account; depositing it in an operating account is commingling.
14. Under a land contract (contract for deed), during the payment period the buyer holds:
Answer & explanation
Answer: D. In an installment/land contract the buyer has equitable title and possession; the seller keeps legal title until the final payment.
15. Which practice best helps an Arizona property management brokerage avoid fair housing claims during tenant screening?
Answer & explanation
Answer: D. Uniform written criteria applied consistently to all applicants reduce disparate treatment risk. Asking about protected characteristics, or selectively screening, invites claims.
16. Which community real property transaction does NOT require the joinder of both spouses under A.R.S. §25-214(C)?
Answer & explanation
Answer: D. Joinder is required for acquisition, disposition, or encumbrance of real property, except for an unpatented mining claim or a lease of less than one year.
17. On a property condition disclosure form, if a seller does not know the age of the roof, the seller should:
Answer & explanation
Answer: C. Only the seller completes the form, reporting what is known and stating when something is unknown; guessing creates liability.
18. A Tempe landlord tells a property manager, 'Don't rent to families with small children because of the pool.' The property is not qualified housing for older persons. The manager should:
Answer & explanation
Answer: B. Refusing to rent to families with children violates the familial status protection of state and federal law. Safety rules must be applied neutrally to all residents, not used to exclude families.
19. The seller prepaid $4,320 in property taxes for the calendar year. Closing is April 20, and the seller owns the day of closing. Using a 360-day year (30-day months), what is the proration?
Answer & explanation
Answer: B. Daily = $4,320 / 360 = $12. Seller owned Jan 1-Apr 20 = 3 months + 20 days = 110 days, so the buyer owes for 360 - 110 = 250 days. 250 x $12 = $3,000, credited to the seller (who prepaid) and debited to the buyer.
20. Which claimant is ineligible to recover from the Arizona Real Estate Recovery Fund?
Answer & explanation
Answer: B. A.R.S. §32-2188(E) excludes a claimant who is the spouse of the judgment debtor or the spouse's personal representative. Restitution orders qualify as judgments, and out-of-state residents are not excluded.
21. Under A.R.S. §25-211, which property acquired by a spouse during marriage is the spouse's separate property rather than community property?
Answer & explanation
Answer: B. Property acquired during marriage is community property except property acquired by gift, devise, or descent (inheritance), which remains separate.
22. Last year a home's limited property value (LPV) was $280,000. This year its full cash value is $340,000. What is the maximum LPV for this year?
Answer & explanation
Answer: B. A.R.S. §42-13301 limits the LPV increase to 5% of the prior year's LPV: $280,000 x 1.05 = $294,000. Because $294,000 is less than the $340,000 FCV, the LPV is $294,000.
23. Before applying to the Arizona Real Estate Recovery Fund, a consumer generally must:
Answer & explanation
Answer: B. The Fund is a fund of last resort. A.R.S. §32-2188 requires a judgment (court judgment, criminal restitution order, or confirmed arbitration award) and diligent collection efforts, including against the employing broker's assets.
24. Under the AAR purchase contract, when must the seller deliver the insurance claims history for the property?
Answer & explanation
Answer: B. The AAR contract requires the seller's insurance claims history within five days after acceptance, with the buyer able to object within the Inspection Period or five days after receipt, whichever is later.
25. A licensee who lacks expertise in a type of property a client wants to sell may proceed under R4-28-1101(H) if the licensee:
Answer & explanation
Answer: D. R4-28-1101(H) requires services to meet recognized standards of competence. Where the licensee lacks expertise, the licensee must get competent help or disclose the lack of expertise in writing to the client, who then decides whether to proceed.
Sources
Source verification pending. Confirm current requirements with your state regulator.