“Educating Homebuyers” Questions only (no answers)
Answers will be revealed with proper subscription

1 of 10 This chapter recommends that you get a list of service providers for your clients. How many service providers in each category were recommended?
A. One in each category – only the best!
B. At least 3 service providers in each category
C. List every local service provider you can find in each category
D. Do not recommend any service providers

2 of 10 Where can a person get a copy of their credit report?
A. Only creditors can see a person’s credit report
B. If anyone wants to see their credit report, they have to enroll in a credit monitoring service
C. A quick Google search will turn up a credit report on anyone
D. Congress enacted a law in 2003 that entitles everyone to one free credit report per year. They can get it from www.AnnualCreditReport.com

3 of 10 How can a credit score impact a borrower’s mortgage loan?
A. The higher the credit score, the lower the interest rate, and thus the monthly payments on a given loan amount
B. Better credit scores mean a buyer can close on a property in a much shorter time
C. Credit scores have little to no impact on a mortgage loan
D. A lower credit score usually results in a larger loan amount

4 of 10 Which type of mortgage approval requires pulling a credit report?
A. Pre-Qualification
B. Pre-Approval
C. Conditional Acceptance
D. Contingent Qualification

5 of 10 The parents of your buyers want to give your buyers $25,000 to put toward purchasing a home.
A. Financial gifts toward down payments are strictly forbidden by federal law
B. Down payments are generally not required, so a gift does not make any difference
C. If a large financial gift shows up in a loan applicant’s bank statements, a lender may ask for a larger down payment to reduce their risk
D. More money is always helpful in purchasing property

6 of 10 What do online Financial Tracking Services offer?
A. They organize spending into nice categories
B. They allow users to set budgets for spending categories
C. They allow users to set financial goals
D. All of the answers listed are true

7 of 10 How many Days on Market (days until a property is under contract) is considered a balanced market?
A. DOM = 120
B. DOM = 7
C. DOM between 30 and 60
D. DOM < 90

8 of 10 What type of agency usually offers first-time homebuyer programs in their state?
A. The bigger commercial banks
B. First-time homebuyer programs were eliminated in 2017
C. State Housing Finance Authorities
D. Smaller credit unions

9 of 10 Which of the following methods was used in this chapter to assess the market conditions?
A. Months of Inventory
B. Sale to List Price Ratio
C. Average DOM
D. All of the answers were used in this chapter ^^^

10 of 10 Is there a difference between being Pre-Qualified and Pre-Approved for a mortgage loan?
A. No, these are the same thing
B. Yes, being Pre-Qualified is stronger than being Pre-Approved
C. Yes, being Pre-Approved in stronger than being Pre-Qualified
D. Yes, different types of lenders offer different types of approvals

11. Which of the following is NOT a benefit offered as part of a first-time homebuyer program?
A. Jumbo loans
B. Lower interest rates
C. Homebuyer education
D. Grants to cover some closing costs

12. How many home buyers used the help of a real estate licensee to purchase their home in 2017?
A. About half
B. Almost 90%
C. Less than 20%
D. About 80%

13. Your buyer has small children and is understandably concerned about registered sex offenders in the neighborhood. What should you do?
A. The registry of sex offenders is not available to the public
B. The seller is required to disclose any registered sex offenders in the neighborhood
C. Give your buyer a list of useful information, including the state website that lists registered sex offenders
D. Check the state’s registered sex offender website for them

14. Which of the following has the biggest impact on a credit score?
A. Mix of credit
B. Timely Payments
C. Average age of credit
D. Employment history

15. What is a Credit Score?
A. It is a way that credit bureaus measure a person’s credit worthiness
B. It is a ratio of current debt to credit limit
C. It is a grade of A, B, C, D, or F based on a person’s timely payment history

16. When might it be a good idea for a buyer to redirect their down payment savings to pay off other debt?
A. When their other debt has high interest rates but could be paid off with plenty of down payment to spare
B. When the other debt is long-term, such as student loans
C. When their other debt is for purchases that do not appreciate, like car loans
D. It is never a good idea to use down payment savings to pay off other debt

17. What types of special financing programs were mentioned in this chapter?
A. VA and FHA loans
B. 1031 Like-Kind Exchange lending
C. Investment property lending
D. 203(q) loans

18. What is the overall maximum debt to income ratio a lender will generally allow when approving a mortgage loan?
A. 36%
B. 20%
C. 3.50%
D. 50%

19. What is the ideal amount of down payment recommended in real estate pre-licensing classes?
A. 3.50%
B. 0%
C. 20%
D. 10%

20. Who is responsible for due diligence to research a property?
A. The buyer’s agent
B. The seller’s agent
C. The buyer
D. The seller

21. Which of the following is would be a sign of a sellers’ market?
A. List to sale price ratio > 99%
B. List to sale price ratio < 95%
C. List to sale price ratio > 75%
D. List to sale price ratio < 90%

22. Which of the following is the easiest way for a buyer to keep track of their spending?
A. Buy a ledger book and write down everything
B. Set up a spreadsheet on a computer and enter all the transactions
C. Learn accounting software like QuickBooks
D. Use an online financial tracking service offered for free from many banks and reputable websites

23. Which of the following would be considered an opportunity in a SWOT Analysis?
A. Being able to hire a certified lead inspector to inspect an older home
B. Having a pre-approval letter included with an offer
C. Giving a large earnest money deposit with an offer
D. Including a personal letter from the buyer with an offer

24. If the buyer wants to negotiate the lowest possible price, what is a strategy that usually works best?
A. Start with a very low offer
B. Offer full list price
C. Offer a low price, and detail issues with the home to account for the low price
D. Offer a price below list, but not low enough to insult the seller

25. What is the single most important part of a strong offer?
A. A full price offer
B. Including a pre-approval letter
C. Having a quick closing date
D. The seller may value any one of a number of factors as most important

26. What are some things the buyer can do to give their offer the best chance of being accepted?
A. View the home many times with family, contractors, to take measurements, etc., the more the better
B. Ask the seller to look up public documents
C. Ask the seller to pay for a home inspection and engineering report
D. Disturb the seller as little as possible, by not scheduling too many viewings, or asking the seller to do the buyers’ due diligence

27. Which of the following is a good piece of information to use when determining an offer price?
A. Fair market value for the property
B. Sale to List Price Ratio in the current market
C. The seller’s situation
D. All of the answers listed are useful when determining an offer price

28. What is a Rubric?
A. A Rubric is a guide used to rate different parts of something that is being evaluated
B. A Rubric is a unit of measure used to calculate square footage
C. A Rubric is a way to estimate monthly costs of ownership
D. A Rubric is a method used to estimate how long a home repair will take

29. What was the example used in this chapter for a SWOT Analysis?
A. Deciding to make an offer on a home that may have lead paint
B. Deciding whether it is worthwhile to make a full-price offer
C. Deciding which of 5 properties would be the best fit for the buyers
D. Deciding which properties to see first

30. What is a decision tree?
A. It is a visual way to show buyers potential outcomes to different decisions
B. It is a type of fir tree that helps make decisions if planted correctly
C. It is a fake tree some agents set up during the holidays
D. It is more of a shrub than a tree, and it doesn’t make any decisions

31. What does “SWOT” in SWOT Analysis stand for?
A. The best angle to orient solar panels: South-West, On Top
B. It is named after Arthur Swot, a mathematician
C. Strengths, Weaknesses, Opportunities, and Threats
D. They are types of investments: Securities, Worth funds, Options, and Trades

32. What does “Time is of the Essence” mean?
A. A clock or watch is included in the sale of the property
B. Anyone who is more than 5 minutes late for an appointment will be billed for the appointment
C. Deadlines are strict, and missing one may mean a party loses a right, or a party is in breach of the contract
D. The general essence of time is important, but the dates do not have to be exact within a few weeks

33. Why would a seller accept a lower priced offer when a higher priced offer is on the table?
A. Sellers would never accept a lower price offer when there is a higher price offer on the table
B. In the case of a like-kind exchange, the seller may be better off taking less money for the property they are selling
C. The lower priced offer had better terms, such as an ideal closing date, more secure financing, no contingency to sell another home, etc.
D. For tax purposes, the seller may prefer to sell their home for less money

34. What factors go into knowing whether to negotiate hard, or tread carefully?
A. Market conditions and the seller’s situation
B. Sales experience of the buyer
C. Current interest rates
D. How intimidating the seller’s agent is

35. Which of the following time-sensitive inspection events is commonly not planned for?
A. Favorite home inspectors are booked out for weeks
B. Home repair experts (plumbers, electricians, etc.) cannot get to the property before the home inspection deadline
C. It takes time for certain tests to come back (water, radon, etc.)
D. All of the events listed are commonly not planned for

36. Is it a good idea for the buyer to include a personal letter to the seller with their offer?
A. No – most professionals believe that a letter can only hurt a buyer’s chances of securing a home
B. Yes – if the letter is written in a way that flatters the seller
C. Yes – if the buyer is offering less than list price, they should detail all the issues in the home to explain their lower offer
D. Yes – the buyers can have the opportunity to tell the sellers all the changes they will make to the home

37. Which of the following tools could help a buyer so they can negotiate from an informed position?
A. House Rating Rubric
B. Decision trees and SWOT analysis
C. Inventory Category worksheet
D. Pre-Approval letter

38. Following Dr. Iyengar’s research findings, how can a buyers’ agent help buyers choose a suitable home in a market with a large inventory?
A. The buyers’ agent should show their buyers every property on the market
B. If the buyers’ agent organizes the properties into 3-5 categories, and shows only a few homes in each category, buyers have an easier time choosing
C. The buyers’ agent should show the buyers the best property in their search area, and advise them to buy that one property
D. The buyers’ agent should tell the buyers to look on their own, and contact the agent only when they have narrowed down their search to 2 properties

39. Dr. Sheena Iyengar, a Columbia University researcher, found buyers are more likely to buy and make better choices under what circumstances?
A. When the choices are put into categories, or there are few choices
B. When the choices are spread out, so they can all be seen at once
C. When there is more choice, buyers have an easier time choosing
D. When there is one clearly superior choice, buyers know to go for that one

40. As a real estate licensee, why should you do your buyers’ due diligence for them?
A. Your buyer may not be as motivated as you to do the research
B. You should NOT do your buyer’s due diligence
C. Due diligence is generally a waste of time and no one needs to do it
D. You know what to do better than your buyers, so you should do all the work

41. When would it be a good idea to share the Closing Disclosure with a past buyer?
A. Real estate agents are not permitted to see a buyer’s Closing Disclosure, so we cannot share it with a buyer
B. There is no need to share the Closing Disclosure with a buyer because they received it at closing
C. Just before tax time, with a thoughtful “Happy New Year” card
D. On the 10-year anniversary of the sale

42. Which of the following due diligence items is the buyer’s agent responsible for?
A. Checking the quality of the school system
B. Finding out the crime rates
C. Reading and interpreting the restrictive covenants
D. Agents are not responsible for any due diligence – this is the buyer’s responsibility

43. Are verbal promises binding in most real estate contracts?
A. Yes – A person’s word is their bond
B. No – Promises must usually be in writing to be enforceable
C. Yes – Even implied promises are binding
D. No – Virtually any promise, written or verbal is not binding

44. Are home inspections important?
A. No – sellers are responsible for making sure a property is 100% perfect before listing
B. No – sellers are responsible for repairing any issues that appear up to 5 years after the sale
C. Yes -the home inspection is a good way to find if there are any significant issues with a home
D. No – most buyers can see issues themselves

45. For tech-savvy buyers, what educational housewarming gift was recommended in this chapter?
A. Educational apps that can be used on a smartphone or tablet like Home Improvement Ideas, DIY Projects, and Photo Cookbook
B. A video drone to spy on neighbors
C. A notepad and pen
D. A houseplant

46. What are two things we can share with our buyers to educate them, so they make rational decisions after a home inspection?
A. 1. A list of common issues found in a home inspection 2. How to do a Benefit-Cost Analysis to see if the home is worth the costs
B. 1. The book containing the international building codes 2. The home inspection reports of all the homes sold in the area in the last 12 months
C. 1. Your real estate pre-licensing textbook 2. The book, Home Inspections for Dummies
D. 1. A list of rental properties they can rent if they can’t find a good home to buy 2. A few pints of ice cream to help them get over the loss of the sale

47. If a real estate client adds themselves to the Do Not Call Registry, can their agent call them?
A. No – not ever
B. Yes – during the transaction and up to 18 months after business has concluded
C. Yes – anytime
D. Yes – only if the agent has a specific real estate reason for calling

48. Which of the following items should a buyer pay to have inspected?
A. Water quality
B. General Home Inspection
C. Septic system
D. The buyer should inspect all the items listed as applicable

49. How can a real estate agent find out if their past and present clients are on the Do Not Call Registry?
A. Real estate agents do not have access to this list
B. It is the consumer’s responsibility to inform any business that they are on the Do Not Call List
C. They must go to the local Do Not Call Registry Office and submit form GS612
D. They may go to www.DoNotCall.gov to look up their clients

50. In terms of getting the most out of a home inspection, what was recommended for your buyer to do during the home inspection?
A. Buyers should not be present during the home inspection, they just get in the way
B. Buyers should be at the home inspection, but they should stay in the kitchen, so the inspector can talk to them only if he or she has questions
C. The buyer should make sure the seller is at the inspection so that the seller cannot deny what the inspector finds
D. The buyers should stick to the inspector like glue during the inspection

51. Which of the following would be considered part of a buyer’s due diligence?
A. Reading the property’s deed
B. Having a home inspection done
C. Reading restrictive covenants, if they exist
D. All of the answers shown

52. What are some ways a real estate agent can continue to educate their buyers after the sale has ended?
A. The agent can call their buyers once a week with weekly tips
B. The agent can give a useful and educational housewarming gift, such as a home improvement book, membership in a gardening organization, certificate to a cooking class, etc.
C. Real estate agents are required to provide their past clients with continuing education classes at least once a year
D. Once a transaction is complete, real estate agents should not have any contact with their past clients

53. What is a consequence of ignoring the phrase “Time is of the Essence?”
A. Losing the right to a contingency
B. Being in breach of contract
C. Loss of earnest money deposit
D. All of the answers listed are correct

54. Which of the following is a recommended way to keep buyers on track with property purchase deadlines and tasks?
A. Nothing, the buyer should know what to do and when
B. Write down lists on scraps of paper
C. Share electronic calendars with your buyers from sources like Contactually, Gmail, and Folio
D. Keep telling your buyers to look at their purchase contract

55. What are some limitations to the home inspection?
A. The inspector cannot see through walls, fly over roofs, or shrink down to fit into tight crawl spaces
B. Most home inspectors are too lazy to do a thorough job
C. Home inspectors are usually also specialty contractors and try to push their repair services, so they exaggerate issues
D. Home inspectors rarely find any issues in homes, making them not worth the money

56. Which of the following is a free service to help agents send reminders to their clients?
A. Folio
B. Skyslope
C. REThink
D. Paperless Pipeline

57. What are some common contingencies listed in this chapter?
A. Appraisal, buyer to sell their home, and seller to find suitable housing
B. Appliance repair, window replacement, and septic system pumping
C. Home to be thoroughly cleaned, shed to be removed, appliances replaced
D. Seller to pay all buyer’s closing costs, seller financing, rent to own
58. How would an economist recommend buyers think about the results of a home inspection?
A. Buyers should let their agent decide for them
B. Buyers should look at the benefits and costs of the home with the uncovered defects to see if the home is worth it to them
C. This is an emotional decision, so emotions play the most important part
D. Buyers should go with their gut reaction

59. Who is responsible for setting up utility accounts in a newly purchased home?
A. The buyer
B. The seller
C. The buyer’s agent
D. The seller’s agent

60. Is it a good idea to give your buyer the webpage to look up the Sex Offender Registry?
A. No – It is a violation of the offender’s rights
B. No – The less your buyer knows about the registry, the better
C. No – As the real estate licensee, you should look up this information for your buyer
D. Yes – Not only does this give your buyer important information, but it empowers them to check the list periodically
61. A real estate market is clearly a buyers’ market when . . .
A. Homes are typically selling for more than listing price
B. Homes are typically selling for less than listing price
C. Home are typically selling at or very near to listing price
D. A buyer’s market is “in the eye of the beholder.”
62. Which lenders were recommended in this chapter?
A. Local loan officers and mortgage brokers
B. Big out of state banks that handle large volumes of loans
C. Online lenders
D. No specific type of lender was recommended
63. Is it a good idea for buyers to require sellers to repair issues that come up in a home inspection?
A. Yes – sellers are required to repair any and all issues that come up in a home inspection
B. Yes – what is there to lose
C. Sometimes – as an agent, you can educate your buyer to the potential outcomes of making the request
D. No – sellers can back out of the contract and keep the earnest money deposit if buyers make such a request
64. What is always the most important part of a purchase offer?
A. The highest price possible
B. The closing date
C. The financing terms
D. It can vary depending on the seller’s motivations
65. How can decision trees help buyers make choices?
A. It shows them which choices produce fruit
B. It shows them different outcomes and an estimate of how likely the outcomes are
C. It shows which decisions will grow money
D. It helps describe branches of their family
66. Is it a good idea to include a Pre-Approval letter with a purchase offer?
A. No – it is none of the sellers’ business to know about the buyers’ financing
B. No – it is unwise to let the seller know where the buyer has been approved for financing
C. Yes – a Pre-Approval letter lets the seller know the buyers are serious and know what they can afford
D. Yes -the sellers can call the lender and find out exactly how much the buyers are willing and able to pay
67. Which item appears on the REALTOR® Magazine’s 10 Most Common Home Inspection Problems?
A. Doors need adjusting and servicing
B. Ugly curtains
C. Peeling wallpaper
D. Decks that are too small
68. What are the benefits to the buyer of an appraisal contingency in a purchase contract?
A. An appraisal contingency may protect them from low appraisals
B. It makes their offer stronger
C. Sellers like to see buyers have thought about the property seriously
D. The longer the contract, the more likely the seller is to accept it
69. What is a risk associated with a buyer who does not know what to expect before having a home inspection?
A. They may buy a home with serious issues because they think every home is in tear-down condition
B. They may not understand what the term “defect” means
C. They may sue the home inspector for telling them things they don’t want to hear
D. They may walk away from a good home because they expect perfection
70. What did this chapter recommend about sharing a list of common issues with buyers before the home inspection?
A. Buyers should not know about common issues because it is expected that the sellers make the home perfect before listing it
B. Sharing a list of common issues with a buyer can help prepare them for what may be found in a home inspection
C. There are no common issues, so sharing a list is a waste of time
D. Home inspections are not recommended, so it is not necessary to share any sort of list
– Final Q&A –
71. If a consumer is confronted with too many choices, what did Columbia University researcher, Dr. Iyengar, find in her research?
A. Consumers make choices quickly
B. Consumers make poor choices or choose nothing at all
C. Consumers purchase more
D. Consumers are more likely to get their friends and family to buy as well
72. Sometimes buyers get discouraged when there is very low inventory. What suggestion did this course make to educate them about the market cycles?
A. Tell buyers to give up and direct them to a rental agent
B. Tell buyers they must choose one of the few available properties before it gets snapped up
C. Show the buyers the properties in their market that have closed in the last 12 months
D. Tell buyers to expand their search to include a neighbor ring state
73. A Rubric is a ______________.
A. federal loan program
B. guide used to rate different parts of something that is being evaluated
C. delicious snack food
D. none of the above
74. Which of the following purchase offer term(s) may be important to a seller?
A. Closing date
B. Request for repairs
C. Size of earnest money deposit
D. All of the items listed may be important
75. Which of the following is a sign that the seller may be motivated to sell?
A. A vacant property
B. A new listing
C. No outstanding mortgage on the property
D. The listing agent told you the seller is firm on the price
76. What could including a Pre-Approval Letter with an offer do?
A. Make the offer look more attractive to the seller
B. Make the buyer look desperate
C. Make the buyer seem less motivated
D. Expose the seller to excessive risk
77. Which of the following should be included in a personal letter that accompanies a purchase offer?
A. A long story about how the buyer has lost out on a number of homes
B. An opening that flatters the seller and their home
C. A detailed list of the visual issues with the home
D. A description of how the buyer will change the home if they buy it
78. How can the buyers make themselves look better to the sellers?
A. Ask to view the property many times
B. Ask the seller to conduct the due diligence
C. Be respectful of the seller by not disturbing them more than necessary
D. Schedule inspections across many days
79. What information can help a buyer determine a good offer price?
A. Fair market value
B. Sale to List Price Ratio
C. DOM of this property compared to the average
D. All of the answers listed are true
80. Is it a good idea to include a personal letter with a purchase offer?
A. No – real estate transactions should always stay completely professional
B. Yes – if the letter is written to appeal to the seller
C. Yes – if the buyers are able to convey that the sellers that the home has multiple issues and theirs is the best offer
D. Yes – if the buyers include their phones numbers so the sellers can call them directly
81. What can enhance a Decision Tree?
A. A list of local arborists
B. Including impossible outcomes
C. Showing Debt to Income Ratios of the sellers
D. Adding the estimated probability of different outcomes
82. This course included 2 examples of using a decision tree. What were they?
A. Asking the seller to make repairs and helping a buyer negotiate a low purchase price
B. Getting the seller to abate lead paint, and asking for cash back at closing
C. Requiring the seller to release an easement, and having them leave kitchen appliances
D. Asking the seller to reduce the price and having them leave furnishings
83. What is the “S” short for in SWOT Analysis?
A. Sellers
B. Strengths
C. Scores
D. Selection
84. Which of the following would be considered an “Opportunity” in a SWOT Analysis?
A. A program that can help defray the costs of Lead Paint Abatement
B. The dangers of lead paint
C. A required lead paint disclosure form
D. The “Protect Your Family From Lead Paint” brochure
85. Which of the following was mentioned as an unexpected timing issue?
A. The buyer schedules radon test early
B. A plumber is available for an estimate while a home inspection is occurring
C. Favorite home inspectors are booked weeks in advance
D. The buyer and their agent know that water tests could take up to one week
86. What does “Time is of the Essence” mean to a lawyer?
A. A date is flexible within 5 working days
B. The term is not binding
C. A 72-hour kick-out clause could be triggered
D. A due date is strict
87. Which of the following financing issues are often not expected by buyers?
A. An appraisal comes in lower than the purchase price
B. A flood certificate shows that the property is in a flood zone
C. A homeowners’ insurance company requires costly repairs
D. All of the answers listed are true
88. Which of the following was recommended for buyers to finish their due diligence when under contract?
A. Threats
B. Checklists
C. Legal Action
D. Bribes
89. Which of the following is considered part of a buyer’s due diligence?
A. Reading the deed for the property
B. Completing the property disclosure form
C. Arranging for childcare while they look at properties
D. Asking the seller to leave appliances
90. What was the last item on the Due Diligence Checklist?
A. Apply for a mortgage
B. Change locks
C. Purchase a housewarming gift
D. Look at the tax bill
91. Which of the following is considered a common contingency in a purchase contract?
A. Seller financing
B. Buyer to terminate lease
C. Seller to find suitable housing
D. Pet deposits
92. What is an example of a lender’s contingency?
A. Seller to find suitable housing
B. Dual agency disclosure
C. School rankings
D. Borrower’s employment verification
93. Which of the following is a limitation of home inspectors?
A. They cannot see into walls
B. They cannot take a water sample
C. They cannot test if faucets work
D. They are not permitted to enter basements
94. Is a home inspection recommended for new construction?
A. No – New construction is perfect
B. Yes – Builders cut corners, and there may be issues like poor water quality or radon in the air
C. Yes – Especially if home inspectors offer buyer agent rebates
D. No – Home inspections are not permitted in new construction
95. Where should a buyer be during a home inspection?
A. Off-site so the inspector can do his or her job
B. On the property, but out of the inspector’s way
C. Sticking with the inspector and asking questions
D. With the seller’s agent to see if he or she looks nervous
96. Which of the following is on the REALTOR® Magazine’s list of Top 10 Common Issues Found in Home Inspections?
A. Service panel deficiencies
B. Inadequate garage space
C. Poor floorplan
D. Outdated paint colors
97. Is a good idea to share a list of common home inspection issues with your buyer before the inspection?
A. No – it may make the buyers change their offer price
B. Yes – it may help prepare them to understand that homes are generally not in perfect condition
C. Yes – because it would save the buyers from doing their own home inspection
D. No – they may blame you if something on the list does not occur in the home they wish to purchase
98. When is the best time in the purchase process to conduct a home inspection?
A. The last day before the inspection deadline
B. After closing
C. Before presenting an offer
D. As soon as possible in case certain tests are needed, or estimates are warranted
99. What tool was recommended for buyers to help them decide if they should walk away after a home inspection?
A. Maxi-min
B. Mini-max
C. Benefit-Cost Analysis
D. Cost-Outcome Analysis
100. Would an economist count the cost of the home inspection in a Benefit-Cost Analysis?
A. No – the seller pays for the home inspection if there are issues
B. Yes – it is a cost
C. No – it is a sunk cost and economists make decisions based on where the decider stands
D. Yes – it is a benefit

ny New York Education Homebuyers

101. Which of the following is a tool suggested to help keep buyers on track in a home purchase?
A. Contactually
B. Folio
C. All of the answers shown were suggested
D. REThink
102. How could buyer education continue after the closing?
A. Call the buyer weekly for the next year
B. Host training seminars at the buyer’s home
C. A thoughtful and educational housewarming gift such as a book, membership in a gardening club, or educational app
D. Continue to show the buyer properties to show how great their purchase was
103. According to Columbia University researcher, Dr. Iyengar, what can help a consumer make a purchase if there are many choices?
A. Present all the choices at once
B. Organize the choices into 3-5 category groups
C. Select only two choices and tell the consumer they must choose one
D. There is virtually nothing anyone can do to help a consumer choose
104. According to Columbia University researcher, Dr. Iyengar, when do consumers find it easier to choose an item to purchase?
A. When there are many choices
B. When they are able to taste their choices
C. When choices are spread out
D. When there are fewer choices
105. Short sales and foreclosures may work well for which buyers?
A. Buyers with small down payments
B. Buyers who have a home to sell
C. Buyers who can be flexible with timelines
D. Buyers who need seller financing
106. What does DOM stand for?
A. Demand on Management
B. Due of Market
C. Does Offer Marketing
D. Days on Market
107. When looking at Sale to List Price Ratio, what is considered a Balanced Market?
A. A Ratio of 75%
B. A Ratio of 50%
C. A Ratio of 25%
D. A Ratio of 95%
108. How is Sale to List Price Ratio calculated?
A. Sale Price ÷ List Price
B. List Price x Sale Price
C. List Price ÷ Sale Price
D. Sale Price x List Price
109. Which of the following is a guide to figure out if it is a “Sellers’ Market” or a “Buyers’ Market?”
A. Sale to List Price Ratio
B. Average Days on Market
C. All of the answers shown
D. Months of Inventory
110. When calculating the Current Month’s Inventory, what is considered a “Balanced Market?”
A. Having 6 months of inventory on the market
B. Having 12 months of inventory on the market
C. Having at least 100 properties for sale in the market
D. Having 1 month of inventory on the market
111. Which party is responsible for looking at the Registry of Sex Offenders if the buyer is concerned about it?
A. The buyer
B. The seller
C. The seller’s agent
D. The buyer’s agent
112. According to the NAR® Annual Survey, how has buyer representation changed over the years?
A. It has steadily decreased since 1981
B. It has remained about the same
C. Buyer agency did not exist until 1995
D. It has increased from 82% in 1981 to almost 90% today
113. Who has the most responsibility to perform due diligence in a real estate purchase?
A. The seller
B. The seller’s agent
C. The buyer
D. The buyer’s agent
114. Why do homebuyers value real estate agents?
A. All of the answers listed are true
B. To help them keep track of deadlines
C. To act as a buffer between the buyer and seller
D. Because the process is complicated and full of risk
115. According to the NAR® annual survey, what percent of homebuyers use a real estate agent?
A. Almost 90%
B. Less than 10%
C. About 50%
D. 100%
116. Which of the following special loan programs require rigorous inspections?
A. Conventional mortgages
B. Seller financing
C. Jumbo loans
D. FHA and VA loans
117. How many loan originators should you recommend to your buyers?
A. Offer a list of every licensed loan originator in your state
B. None – Let the buyers find their own lenders
C. At least 3 reputable loan originators
D. Choose only the one best loan originator you know
118. Which of the following states have First Time Homebuyer Programs?
A. Only Florida and Texas
B. All the states plus the District of Columbia offer First Time Homebuyer Programs
C. Only Colorado and Washington
D. Only New York and California
119. Which of the following is always preferred when applying for a mortgage?
A. A local mortgage broker
B. A local bank
C. There is no single preferred loan originator, it depends on the borrower’s situation
D. A local credit union
120. Which of the following is the MOST important component of a credit score?
A. Number of children in the household
B. Highest level of education attained
C. Timely payments on debt
D. Number of credit checks

Educating Homebuyers

— add ny this class 1/1/23–
1) Why do buyers have to use a real estate agent?
a. The purchase process is complicated
b. The deadlines are strict, and the process is full of risk
c. The two parties in the transaction often need a buffer so they don’t’ walk away
d. All of the reasons listed are true
2) How can a credit score affect a borrower’s mortgage interest rate?
a. Credit scores have absolutely no impact on an interest rate a borrower would pay
b. Credit scores have to be a B or better to get a loan
c. A mortgage interest rate can vary by as much as 1.5%, depending on a borrower’s credit score
d. A lower credit score means lower interest rates
3) What is the ideal amount of down payment recommended in real estate pre-licensing classes?
a. 3.50%
b. 0%
c. 20%
d. 10%
4) A real estate market is clearly a buyer’s market when . . .
a. Homes are typically selling for more than listing price
b. Homes are typically selling for less than listing price
c. Home are typically selling at or very near to listing price
d. A buyer’s market is “in the eye of the beholder.”
5) The parents of your buyers want to give your buyers $25,000 to put toward purchasing a home. What should you tell your buyers?
a. Financial gifts toward down payments are strictly forbidden by federal law
b. Down payments are generally not required, so a gift does not make any difference
c. If a large financial gift shows up in a loan applicant’s bank statements, a lender may ask for a larger down payment to reduce their risk
d. More money is always helpful in purchasing property
6) Which states offer first-time homebuyer programs?
a. Only California, New York, and Texas
b. Only Washington, Colorado, and Massachusetts
c. All 50 states plus the District of Columbia
d. The first-time homebuyer programs were eliminated in 2017
7) How do you calculate months of inventory?
a. Divide the current active listings by the average number of closings per month from the last year
b. Take the current number of active listings and divide by 12
c. Divide the town’s population by the number of active, contingent, and pending properties currently in the MLS
d. Take the average list price and divide it by the square root of the number of active listings currently in the MLS
8) What is a credit report?
a. It is a report that shows a person’s credit accounts, credit limits, and how timely their payments have been in the last 2 years
b. It is a number between 200 and 850
c. It is a report on a person’s debt to income ratio
d. It a report that includes current credit accounts and a criminal background check
9) How many home buyers used the help of a real estate licensee to purchase their home in 2021?
a. About half
b. Almost 90%
c. Less than 20%
d. About 80%
10) Which of the following is a sign of a seller’s market?
a. List to sale price ratio > 99%
b. List to sale price ratio < 95%
c. List to sale price ratio > 75%
d. List to sale price ratio < 90%
11) What type of state agency usually offers first-time homebuyer programs?
a. The bigger commercial banks
b. First-time homebuyer programs were eliminated in 2017
c. State housing finance authorities
d. Smaller credit unions
12) In which case was it recommended that a buyer seek out a good mortgage broker?
a. When their situation is simple and easy
b. When the buyer has an unusual circumstance, like being self-employed, or having a foreclosure in their past
c. Mortgage brokers were not recommended
d. When the mortgage broker offers enticing kickbacks to the agents
13) Which of the following financing issues occur after the financing contingency deadline has passed?
a. The appraisal comes back below the contract price
b. The flood certificate shows the property is in a flood zone
c. The insurance company has issues with the property and requires expensive repairs
d. All of the issues listed frequently occur after the financing contingency deadline has passed
14) Which of the following tools could help a buyer negotiate from an informed position?
a. House rating rubric
b. Decision trees and SWOT analysis
c. Inventory category worksheet
d. Pre-approval letter
15) What are some ways your buyer can be a better negotiator?
a. If your buyer understands the potential outcomes and risks by using tools such as decision trees and SWOT analysis
b. Negotiators are born, not trained
c. Buyers should not negotiate; they have agents to make decisions for them
d. Buyers are generally not in a position to negotiate; they have to take the terms the seller sets
16) How would knowing the sellers’ motivation help to structure an offer?
a. The seller may be motivated to move quickly
b. The seller may have a large outstanding mortgage on the property, and will not sell for less than that balance
c. The seller may have lost a sale because of a previous buyer’s financing falling through
d. All of the answers listed
17) What is a consequence if a buyer misses a deadline in a contract that includes the term “Time is of the Essence?”
a. The buyer may lose their right to a contingency
b. Nothing – this is a standard term that has lost its meaning over the years
c. The buyer may have to pay a fine of up to $10,000
d. The buyer may face jail time of up to 3 months
18) What items could be used in a house rating rubric?
a. Mortgage rates, projected appreciation, price of gas, etc.
b. Furnishings, artwork, clutter, etc.
c. Price, neighborhood, bedrooms, yard, etc.
d. Experience of buyers’ agent, sellers’ agent, loan originator, etc.
19) If the buyer wants to negotiate the lowest possible price, what strategy usually works best?
a. Start with a very low offer
b. Offer full list price
c. Offer a low price, and detail issues with the home to account for the low price
d. Offer a price below list, but not low enough to insult the seller
20) If your buyers decide to include a personal letter with their offer, what should be included?
a. A recounting of how many homes the buyers did not get, and how they were treated unfairly in the past
b. A list of things the buyers will change in the home, like remodeling, demolition, etc.
c. A long, detailed description of how great the buyers are
d. A short introduction that flatters the seller
21) What is a common problem that buyers have when there is too much inventory on the market?
a. This is a great situation with no problems
b. They pay too little for properties
c. They have a difficult time selecting a home to buy
d. They expect their buyer’s agent to choose for them
22) How can a decision trees help buyers make choices?
a. It shows them which choices produce fruit
b. It shows them different outcomes and an estimate of how likely the outcomes are
c. It shows which decisions will grow money
d. It helps describe branches of their family
23) What can a buyers’ agent do to educate buyers who are distraught over the lack of inventory during the slow time of the year?
a. Tell the buyers to give up and just keep renting
b. Ask the buyers if they would like to expand their search by increasing their budget
c. Ask the buyers if they would like to expand their search by looking at properties farther away
d. Show the buyers listings for properties that have sold in the last 12 months
24) Would an economist recommend that a buyer take the inspection fee into consideration when deciding whether to purchase a home with an unsatisfactory home inspection?
a. Yes -The inspection fee is part of the purchase price
b. No – Economists would call this a “sunk cost” which is in the past and cannot be recovered
c. Yes – The home inspection fee will be paid by the seller if any defects are found
d. No – Buyers should expect to pay for 10-12 home inspections before finding a suitable home
25) Is it recommended to conduct a home inspection on a newly constructed home?
a. No – new construction is always free of defects
b. No – the building code enforcement officer catches every possible issue
c. Yes – there can be many issues in new construction, from cutting corners to well-water quality issues
d. Yes – the more money spent during the transaction, the more commission the buyer’s agent will make
26) What information on a Closing Disclosure is useful after the sale has closed?
a. Contact information of the sellers in case there are any future issues they must repair
b. This is a receipt for many rebates from service providers
c. There is nothing useful to the buyer on this form
d. Documentation of many potential tax deductions
27) Which of the following tax deductions may appear on a Closing Disclosure?
a. Real estate commissions
b. Appraisal fees
c. Filing fees
d. Property taxes paid at closing
28) What is an example of a financing contingency that may appear in a pre-approval letter?
a. The buyers may have to obtain a gift letter from a family member who gave them money toward the home
b. The seller’s agent may have to provide proof they are licensed
c. The seller may have to show that the property complies with new construction building codes
d. The lender may have to provide evidence they have a bond to cover the mortgage amount
29) What is a consequence of ignoring the phrase “Time is of the Essence?”
a. Losing the right to a contingency
b. Being in breach of contract
c. Loss of earnest money deposit
d. All of the answers listed are correct
30) — f — 1/3/23
31) What type of tools can help people monitor their spending, set goals, and help budget for their property?
a. Electronic wallets
b. Automatic payment websites
c. Bookkeeping apps
d. Financial tracking
32) Who is ultimately responsible for making the decision about what to offer for a home?
a. The appraiser
b. The client
c. The best negotiator
d. The licensee
33) What is another way of stating that a due date or deadline is strict and immutable?
a. Early bird gets the worm
b. Time binds
c. Tempus fugit
d. Time is of the essence
34) In a benefit-cost analysis, what does it mean if the cost is bigger than the benefit?
a. Proceed quickly
b. Offer a lower price
c. Buy the good
d. Don’t buy the good
35) When should buyers get a handle on their personal finances?
a. After they have made an offer on a home
b. Before they even think about searching for property
c. After looking at a few properties so they know how much of a loan they will need
d. As soon as they find the home they want
36) Which of the following is considered a frequently seen contingency in a purchase contract?
a. Seller financing
b. Buyer to terminate lease
c. Seller to find suitable housing
d. Pet deposits
37) Which number allows lenders to see if a potential borrower is a low, medium, or high risk?
a. Driver’s license number
b. Abrams score
c. Social Security number
d. Credit score
38) Fair market value and the seller’s situation are good bits of info to help determine what?
a. Dual agency
b. DOM averages
c. Neighborhood marketing trends
d. A good offer price
39) If a buyer decides to include a personal letter, how should they end it?
a. Explain a difficult experience from the past
b. Flatter the seller
c. Sign it, “With gratitude”
d. State what they want to change
40) Reading the deed for a property would be considered to be part of what?
a. Buyer’s due diligence
b. Seller’s disclosure requirements
c. Fair housing addendums
d. MLS listing
41) A low offer has what chance of being rejected?
a. 86%
b. 27%
c. 53%
d. 5%
42) If your brokerage doesn’t have appraisal contingency wording for you to use in your contract, what should your buyers do?
a. Write the contingency themselves
b. Seek competent legal help to add that contingency
c. Have the seller write the contingency
d. Look online for a suitable contingency
43) Which type of letter from a lender means that the lender has pulled a credit report, and a loan application has been conditionally approved by a loan underwriter?
a. Pre-fixe
b. Pre-conditional
c. Pre-qualification
d. Pre-approval
44) What reduces surprises and helps buyers make sound decisions?
a. Knowledge
b. Choices
c. Legal representation
d. Pressure
45) What does the S stand for in SWOT analysis?
a. Sellers
b. Strengths
c. Scores
d. Selection
46) According to the quoted NAR® annual survey, what percentage of homebuyers employed a real estate professional in procuring their home?
a. Less than 10%
b. About 50%
c. Almost 90%
d. 100%
47) Showing buyers the properties in their market that have closed in the last 12 months can help them to overcome discouragement due to what?
a. Other markets
b. High inventory
c. Low inventory
d. Low budget
48) On which form are a number of potential tax dedications documented?
a. Broker Contract
b. Closing Disclosure
c. Notice to Vacate
d. All of the above
49) Which of the following is the strongest evidence that a buyer can get a mortgage loan for a property?
a. A pre-qualification letter from a loan officer
b. A pre-certification letter from a real estate licensee
c. A signed and notarized letter from the borrower, attesting they are able to afford the property
d. A pre-approval letter from a lender
50) Which of these is mentioned as a good idea if a buyer chooses to include a personal letter to a seller?
a. Be humble.
b. Highlight how secure the offer is
c. Do NOT tell them what the buyers will change
d. All of the above
51) This course included two examples of using a decision tree. What were they?
a. Asking the seller to make repairs, and helping a buyer negotiate a low purchase price
b. Getting the seller to abate lead paint, and asking for cash back at closing
c. Requiring the seller to release an easement, and having them leave kitchen appliances
d. Asking the seller to reduce the price and having them leave furnishings
52) An opening that flatters the seller and their home is a good way to begin what?
a. A mortgage application
b. A personal letter that accompanies a purchase offer
c. A detailed list of the visual issues with the home
d. None of the above
53) Which of the following is a guide to figure out if it is a seller’s market or a buyer’s market?
a. Months of inventory
b. Sale to list price ratio
c. Average days on market
d. All of the answers shown
54) Which is a good way to prepare buyers for a home inspection?
a. Share with them a top-10 list of common defects in your local housing market
b. Have them take an online course in home appraisals
c. Require them to take building classes at a local hardware store
d. Tell them that the home inspection isn’t that important
55) Which of the following is a possible tax deduction that may be found on a Closing Disclosure?
a. The appraisal
b. Homeowners insurance premium
c. Discount points
d. The flood certificate
56) The O in a SWOT analysis could best be represented by which of the following?
a. The “Protect Your Family From Lead Paint” brochure
b. A required lead paint disclosure form
c. The dangers of lead paint
d. A program that can help defray the costs of lead paint abatement
57) Which of the following is a tool suggested to help keep buyers on track in a home purchase?
a. buildout
b. SkySlope
c. Paperless Pipeline
d. All of the answers shown were suggested
58) When calculating the current month’s inventory, what is considered a balanced market?
a. Having 1 month of inventory on the market
b. Having 12 months of inventory on the market
c. Having 6 months of inventory on the market
d. Having at least 100 properties for sale in the market
59) Real estate professionals are valuable for prospective homebuyers for what reason?
a. To help them keep track of deadlines
b. To act as a buffer between the buyer and seller
c. All of the answers listed are true
d. Because the process is complicated and full of risk
60) How can a borrower obtain a copy of their credit report?
a. They can visit www.AnnualCreditReport.com for a free report
b. They can purchase their report from any department store for $50
c. These reports are not available to consumers
d. The reports are available from any lender, but only when a consumer applies for credit
61) If your buyer has a contingency to sell their own home before they can close on the seller’s home, they need to know that, on average, it takes how long to close a real estate transaction?
a. 6 months and 10 days
b. 7 days
c. 3 months
d. 6 weeks
62) Which of the following states has a first-time homebuyer program?
a. Only New York and California
b. Only Florida and Texas
c. Only Colorado and Washington
d. All the states plus the District of Columbia offer First Time Homebuyer Programs
63) How is the sale to list price ratio calculated?
a. Sale Price ÷ List Price
b. List Price ÷ Sale Price
c. Sale Price x List Price
d. List Price x Sale Price
64) Anything less than how much of a down payment is considered risky by lenders, so they would require a borrower to pay for private mortgage insurance (PMI) on conventional loans?
a. $2,500
b. $10,000
c. 20%
d. 35%
65) When you are working with a buyer, they are responsible for ___________?
a. Due diligence
b. Broker’s gas money
c. Seller opinions
d. Just deserts
66) To help your buyers understand the market, pull together information on recent sales and fill out which worksheet?
a. Negotiating 101
b. Structuring an Offer
c. Buyer’s Market vs. Seller’s Market
d. Inventory Category
67) What type of analysis lets you lay out the situation in a way that is easier for your buyers to understand?
a. Contrasting
b. SWOT
c. Reciprocal
d. TRID
68) Make sure the buyers are aware of this risk if they are accepting a financial gift within how many weeks of applying for a mortgage loan?
a. 1
b. 8
c. 12
d. 4
69) What agency is responsible for regulating the tasks that a home inspector can perform?
a. EEOC
b. OSHA
c. FICA
d. FTC
70) Which act allows consumers to access their free credit reports, once a year, with no strings attached?
a. Truth in Lending Act
b. Fair and Accurate Credit Transactions Act
c. Credit Transparency Act
d. Equal Lending Act
71) The first phone call after a contract has been accepted should be to whom?
a. A lender
b. A lawyer
c. A home inspector
d. An interior designer
72) What is the name for a guide used to rate different parts of something that is being evaluated?
a. Rubric
b. Lateral
c. Tutorial
d. Diagram
73) Which of the following was suggested as a first step for buyers to get their finances in order?
a. Using a financial tracking tool to keep track of their spending
b. Paying off any student loans
c. Opening a line of credit from a home improvement store
d. Requesting financial gifts from family members
74) Which type of letter from a lender generally doesn’t require pulling a credit report or submitting an application to an underwriter?
a. Pre-contract
b. Pre-emptive
c. Pre-approval
d. Pre-qualification
75) Absence of or defective smoke alarms was called out on what list?
a. REALTOR® Magazine’s 10 Most Common Lists of 3 Words
b. REALTOR® Magazine’s 10 Most Common Ways to Start a Fire
c. REALTOR® Magazine’s 10 Most Common Home Inspection Problems
d. REALTOR® Magazine’s 10 Worst Redecorating Ideas
76) Who is liable if a real estate licensee attends a home inspection without the buyers?
a. The sellers
b. The buyers
c. The real estate licensee
d. The home inspector
77) What is the most common reason for a purchase agreement to fall through?
a. Expensive homeowners insurance
b. A leaky roof
c. Buyer’s remorse
d. An unsatisfactory home inspection
78) In which of these scenarios do consumers find it easier to choose an item to purchase?
a. When there are fewer choices
b. When there are many choices
c. When choices are spread out
d. When they are able to taste their choices
79) Buyers generally need to supply how many months of bank statements to a lender when applying for a mortgage loan?
a. 9
b. 3
c. 6
d. 12
80) Which of these would an economist consider a “sunk cost”?
a. The cost of a home inspection in a benefit-cost analysis
b. Purchase price for an FHA-mortgaged home.
c. Future plans for landscaping
d. Defect disclosures
81) Which of the following relationships is the most accurate?
a. A high credit score means higher interest rates paid on debt
b. A high credit score may result in a lower interest rate
c. A high credit score may result in the consumer being turned down for credit
d. A low credit score could result in a very high pre-approval amount
82) Buyers often do not expect this financing issue:
a. An appraisal comes in lower than the purchase price
b. A flood certificate shows that the property is in a flood zone
c. A homeowners’ insurance company requires costly repairs
d. All of the answers listed are true
83) Which of the following websites offers free financial tracking services?
a. Realtor.com
b. Mint.com and countabout.com
c. Folio.com
d. Trulia.com and Zillow.com
84) With the current TILA-RESPA Integrated Disclosure laws, a delay in closing generally means at least how long before a new closing date can be scheduled?
a. 2 months
b. 9 days
c. One week
d. 48 hours
85) What is the name for a visual way to show possible outcomes of different decisions?
a. Choice graphic
b. Option grid
c. Decision tree
d. Picking plant
86) What tool can be used to create categories of homes that will help a buyer select a property?
a. Array
b. Venn diagram
c. Rubric
d. Probability tree
87) Which of the following is true?
a. Home inspectors cannot see through walls
b. Home inspectors can shrink down to investigate tight crawl spaces
c. Home inspectors cannot check to see if faucets work
d. Home inspectors are not permitted to enter basements
88) In the Debt Profile Worksheet, a buyer can list their debts, minimum monthly payments, and what else?
a. Gross income
b. Projected tax refund
c. Planned purchases
d. Interest rates
89) You should help your buyers structure their offer based on what?
a. What the sellers want
b. Pricing based on stock market trends
c. Making sure the sellers don’t make an excessive profit
d. The amount the sellers owe on their mortgage
90) When you are working with a buyer, who is responsible for the due diligence?
a. The buyer
b. The broker
c. The seller
d. The home inspector

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