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What Is "Constructive Notice" in Real Estate?
A) The official announcement of a property's sale
B) A notice given to tenants about rent increases
C) Legal notice presumed by law when a document is recorded in public records
D) The physical notice posted on a property
Correct Answer: C) Legal notice presumed by law when a document is recorded in public records
Explanation: Constructive notice is the legal presumption that information has been obtained by an individual through due diligence, typically by recording documents in public records.
What Is "Habendum Clause" in a Deed?
A) A clause that lists the property's features
B) A clause that describes the rights and interests being given to the grantee
C) A clause that specifies the loan terms
D) A clause that details the inspection results
Correct Answer: B) A clause that describes the rights and interests being given to the grantee
Explanation: The habendum clause in a deed specifies the extent of the interest being granted and any conditions affecting that interest. It usually begins with “to have and to hold.”
An Investor Purchases a Rental Property in Ohio for $500,000. The Property Generates a Monthly Rental Income of $4,000. If the Investor Expects an Annual Return of 8%, What Is the Maximum Amount They Should Have Paid for the Property To Meet This Return?
A) $480,000
B) $500,000
C) $540,000
D) $600,000
Correct Answer: B) $500,000
Explanation: The annual rental income is $4,000 × 12 = $48,000. To achieve an 8% annual return, the property’s purchase price should be such that $48,000 is 8% of the purchase price. Therefore, the maximum purchase price is $48,000 / 0.08 = $600,000.
What Is "Subrogation" in the Context of Real Estate Insurance?
A) The substitution of one person or entity in place of another with regard to a lawful claim or right
B) The process of transferring property ownership
C) The repayment of a mortgage loan
D) The assessment of property value for tax purposes
Correct Answer: A) The substitution of one person or entity in place of another with regard to a lawful claim or right
Explanation: Subrogation allows an insurance company to step into the shoes of the insured and seek reimbursement from the responsible party for a claim it has already paid.
What Is the "Doctrine of Laches" in Real Estate Law?
A) A rule that allows property to revert to the state if the owner dies without heirs
B) A principle that bars a claim due to a delay in asserting it
C) A law that governs tenant-landlord relationships
D) A regulation concerning property taxes
Correct Answer: B) A principle that bars a claim due to a delay in asserting it
Explanation: The doctrine of laches is an equitable principle that prevents someone from asserting a claim if they have unreasonably delayed in doing so and that delay has prejudiced the opposing party.
A Homeowner in Ohio Refinances Their Mortgage to a New Loan Amount of $250,000 at an Annual Interest Rate of 4% Over a 20-Year Term. What Will Be the New Monthly Mortgage Payment (Principal and Interest Only)?
A) $1,170.22
B) $1,207.85
C) $1,249.60
D) $1,300.78
Correct Answer: A) $1,170.22
Explanation: Using the mortgage payment formula, P = $250,000, r = 0.04 / 12 = 0.003333, and n = 2012 = 240. M = 250,000[0.003333(1+0.003333)^240] / [(1+0.003333)^240 – 1] ≈ $1,170.22.
Jane, a Real Estate Salesperson in Ohio, Is Applying for a Broker’s License. She Completed Her Education Requirements but Has Been Convicted of a Misdemeanor Involving Fraud. Can Jane Obtain Her Broker’s License?
A) Yes, as long as she has completed her education requirements
B) Yes, if the conviction was more than five years ago
C) No, because any conviction bars her from obtaining a broker’s license
D) No, unless the Ohio Real Estate Commission determines she will not repeat the offense
Correct Answer: D) No, unless the Ohio Real Estate Commission determines she will not repeat the offense
Explanation: According to Ohio law, a person may be denied a real estate license if they have been convicted of a crime involving fraud, unless the Ohio Real Estate Commission is satisfied that the applicant will not again violate such provisions.
An Ohio Real Estate Agent Wishes To Put Their License on Voluntary Hold Due to Personal Reasons. What Steps Must They Take?
A) They cannot place their license on hold
B) They must notify the Ohio Real Estate Commission in writing
C) They must complete an additional 40 hours of education before doing so
D) They need to reapply for a new license once ready to return
Correct Answer: B) They must notify the Ohio Real Estate Commission in writing
Explanation: Ohio law allows real estate agents to place their license on voluntary hold by notifying the Ohio Real Estate Commission in writing before the license renewal date.
A Developer in Ohio Is Selling Units in a New Condominium. Before Selling, They Promise Certain Amenities That Are Not Included in the Final Build. What actions Can the Buyers Take Under Ohio Law?
A) None, as amenities are not part of the legal contract
B) Sue the developer for breach of contract and misrepresentation
C) Accept the units as they are
D) Demand a reduction in the purchase price
Correct Answer: B) Sue the developer for breach of contract and misrepresentation
Explanation: Buyers can take legal action against the developer for breach of contract and misrepresentation if promised amenities are not delivered. Ohio law requires that representations made in selling real estate must be honored.
John, a Licensed Real Estate Agent in Ohio, Provides Assistance in a Transaction Involving a Property Where He Has an Undisclosed Financial Interest. What Are the Possible Consequences of His Actions Under Ohio Real Estate Law?
A) He may receive a warning from the Ohio Real Estate Commission
B) He could face disciplinary actions such as suspension or revocation of his license
C) His license will be automatically renewed without issues
D) He will be fined but not face any license suspension
Correct Answer: B) He could face disciplinary actions such as suspension or revocation of his license
Explanation: Ohio law allows the Ohio Real Estate Commission to suspend or revoke the license of any agent who fails to disclose their financial interest in a property involved in a transaction, as this constitutes misconduct under Ohio Revised Code Section 4735.18.