Real Estate Principles Chapter 16 Quiz 1. A seller lists her home for sale, and her broker subsequently submits to her a full-price offer from a ready, willing, and able buyer. The seller refuses the offer and tells the broker it's because the buyer is black. The broker may: A. tell the seller that she is in violation of the Fair Housing Act B. sue the seller for his full commission C. inform the buyer of his right to file a complaint with HUD D. All of the above

2. A broker has a particular home listed for sale and an African-American buyer comes by and asks to see it. Under what circumstances may the broker refuse to show the buyer the home? A. Under no circumstances B. If the broker honestly believes that a sale to the buyer could result in panic selling C. If the broker knows that the neighborhood is non-integrated and believes the buyer would feel uncomfortable there D. If the seller is on vacation and has asked the broker not to show the house while he is gone

3. A real estate licensee is approached by a minority homebuyer who asks to be shown a specific home in a minority neighborhood. It is lawful for the licensee to assume that: A. the buyer is comfortable within that particular neighborhood because of its ethnic composition B. the buyer is interested in buying a home in a minority neighborhood C. the buyer wants a particular size and style house D. All of the above

4. Broker Beatrice obtains a full-price offer on a home from a Chicano buyer, as well as a lower price offer from a white buyer. She presents both offers to the seller, who accepts neither and instead sells to a neighbor, through Beatrice. The neighbor tells Beatrice and the seller he is buying the house because he is uncomfortable with minorities moving into the neighborhood. Who has not violated the Fair Housing Act? A. Beatrice B. the seller C. the white buyer D. the neighbor

5. The purpose of the Equal Credit Opportunity Act is to: A. prevent lenders from discriminating against credit applicants B. lower the cost of obtaining financing C. standardize the requirements for obtaining credit D. increase the amount of credit available to individual borrowers

6. An apartment rental application contains a question about marital status. This question is: A. unlawful B. is permissible as long as the building is owned by a single party C. is permissible as long as rental ads inform applicants that the owner prefers married couples D. is permissible as long as the building rents to unmarried tenants as well as married tenants

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7. In an attempt to obtain listings, a broker visits sellers in a particular neighborhood and tells them that property values will soon decline due to a recent influx of minority homebuyers. This tactic is: A. legal if the statements can be proven true B. legal as long as no sellers give him listings as a result of his statements C. unethical but legal D. illegal

8. Under the Fair Housing Act, an apartment owner is permitted to do all but which of the following? A. Check references from previous landlords B. Run credit reports on applicants C. Require security deposits D. Require only single tenants to have a lease co-signor

9. A deed contains a restrictive covenant barring the sale of the land to persons of non-Caucasian descent. This covenant: A. is enforceable only as long as the grantor remains living B. may be enforced by the grantee C. is unenforceable but does not invalidate the conveyance D. is illegal and invalidates the conveyance

10. In an integrated urban neighborhood, rising crime rates have caused a number of white families to move. Observing this trend, a broker begins actively soliciting listings from white families, providing discounted commission rates and frequent reminders that neighborhood values are declining. In doing so, the broker is: A. using legal, effective marketing techniques B. staying within the requirements of the Fair Housing Act C. violating the Fair Housing Act by engaging in blockbusting D. violating the Fair Housing Act by engaging in racial steering

11. The Federal Fair Housing Act was intended to: A. provide opportunity for fair housing for all persons in the U.S. B. guarantee separate but equal housing in the U.S. C. eliminate prejudice in the U.S. D. create housing for disadvantaged minority groups in the U.S.

12. Under the Fair Housing and Employment Act, a person who has suffered from discrimination in housing may receive: A. an opportunity to buy or rent the property if it is still available B. an opportunity to buy or rent a similar property C. money damages D. Any of the above

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13. A broker regularly lists homes at prices about 10% above their fair market value, requiring minority buyers to pay the listed prices, but allowing other buyers to pay lower amounts. This: A. does not violate the Fair Housing Act because minority buyers are not asked to pay more than the listed price B. would violate the Fair Housing Act only if an FHA or VA loan is involved C. subjects only the property owners to penalties for violation of the Fair Housing Act D. is unlawful and could make the broker liable for money damages

14. According to the Americans With Disabilities Act: A. a real estate office is considered to be a public accommodation B. a disability is defined as any permanent physical impairment C. architectural barriers that prevent access to goods and services must be removed regardless of cost D. all multi-story buildings must be equipped with elevators

15. The prohibition against discrimination on the basis of handicap in the Federal Fair Housing Act would not apply to discrimination against: A. a chronic alcoholic B. a heroin addict C. a person diagnosed as having AIDS D. a person with a mental disability

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Answer Key with Explanations 1 D Explanation: The seller has violated the Fair Housing Act. She also owes her broker the commission, since he did locate a suitable buyer.

2. D Explanation: The broker is bound by the seller's instructions. Under options B and C, the broker would be violating the Fair Housing Act.

3. C Explanation: A licensee is not lawfully entitled to make any assumptions based on race.

4. C Explanation: The neighbor has violated the Fair Housing Act by acting to prevent a minority from moving into the neighborhood. The seller and Beatrice have violated the act by cooperating with the neighbor when they were aware of his intentions. The white buyer has done nothing to violate the act.

5. A Explanation: The Equal Credit Opportunity Act was enacted to bar lenders from discriminating against credit applicants based on race, color, religion, sex, marital status, and age (provided the applicant is of legal age).

6. A Explanation: It is illegal for a rental property owner to ask applicants for information regarding marital status.

7. D Explanation: This is blockbusting, or panic selling, and against the law. The licensee is also subject to disciplinary action.

8. D Explanation: Requiring only single tenants to have co-signors constitutes discrimination on the basis of marital status, and is a violation of the Fair Housing Act.

9. C Explanation: The covenant is unenforceable but the deed otherwise remains valid.

10. C Explanation: Both of his marketing techniques constitute illegal acts under the Fair Housing Act.

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11. A Explanation: The purpose of the Federal Fair Housing Act is to provide fair housing opportunity for all persons by prohibiting discrimination in housing transactions.

12. D Explanation: The law authorizes all of the above remedies for a person who has been discriminated against in the sale or rental of housing.

13. D Explanation: Requiring minorities to pay higher prices than others is unlawful discrimination under the Fair Housing Act. The broker may be liable for money damages.

14. A Explanation: Under the ADA, any private entity with facilities open to the public (such as a real estate office) is to be considered a public accommodation.

15. B Explanation: The Federal Fair Housing Act does not protect those who are a direct threat to the health or safety of others, or those who are currently using controlled substances.

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