Illinois Real Estate Exam Prep Quiz: Trivia!

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Quizzes Created: 810 | Total Attempts: 1,107,120

Questions: 10 | Attempts: 285 | Updated: Mar 21, 2023

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Illinois Real Estate Exam Prep Quiz: Trivia! - Quiz

The Illinois Real Estate Exam is administered by the State of Illinois Department of Financial and Professional Regulation Bureau of Real Estate Professions for aspiring real estate brokers, Managing brokers, Leasing Agents, Real Estate firms, Real Estate Appraisers, Auctioneers, Auction firms, and Home Inspectors. This practice test will help you in your preparation for the exam.

Questions and Answers

1.

Which is a type of real estate loan?
- A.
  
  Fixed-rate mortgage loan
- B.
  
  Unconventional loan
- C.
  
  Adjustable-rate mortgage loan
- D.
  
  A & C
Correct Answer
D. A & C

Explanation
A fixed-rate mortgage loan is a type of real estate loan where the interest rate remains the same throughout the entire term of the loan. This provides stability for the borrower as they know exactly how much their monthly payments will be. An adjustable-rate mortgage loan, on the other hand, has an interest rate that can fluctuate over time. Both of these options are commonly used in real estate financing.

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2.

What are C & I loans?
- A.
  
  Short-term loans secured with collateral owned by the business requesting the loan.
- B.
  
  Loans to businesses.
- C.
  
  Loans to individuals.
- D.
  
  A & B
Correct Answer
D. A & B

Explanation
C & I loans refer to loans made to both businesses and individuals. These loans can be short-term and are typically secured with collateral owned by the borrower. Therefore, option A, which states that C & I loans are short-term loans secured with collateral owned by the business, is correct. Option B, which states that C & I loans are loans to businesses, is also correct.

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3.

A Deed of Trust is an agreement between a lender and a borrower. During the repayment, the borrower retains the legal title. How true is this?
- A.
  
  Completely true
- B.
  
  Occasionally true
- C.
  
  Depends on the agreement
- D.
  
  Not true
Correct Answer
D. Not true

Explanation
The statement "A Deed of Trust is an agreement between a lender and a borrower. During the repayment, the borrower retains the legal title" is not true. In a Deed of Trust, the borrower actually transfers the legal title of the property to a trustee, who holds it as security for the lender. The borrower retains equitable title and has the right to possess and use the property, but the legal title is held by the trustee until the loan is fully repaid.

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4.

What must the Trustee in a Deed of Trust be?
- A.
  
  Kind
- B.
  
  Honest
- C.
  
  Impartial
- D.
  
  Interested in the property
Correct Answer
C. Impartial

Explanation
The Trustee in a Deed of Trust must be impartial. This means that they must be unbiased and not favor any party involved in the transaction. As a neutral third party, the Trustee's role is to ensure that the terms of the Deed of Trust are followed and that the interests of all parties are protected. Being impartial helps to maintain the integrity and fairness of the transaction.

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5.

How can a Notice of Default be removed? If...
- A.
  
  You're not guilty.
- B.
  
  You never received the notice.
- C.
  
  You were on a vacation so you couldn't respond.
- D.
  
  You politely ask the creditors to remove it.
Correct Answer
B. You never received the notice.

Explanation
If you never received the notice of default, it can be removed because you were not aware of the situation and therefore unable to respond. It is important to have evidence or documentation to support your claim that you did not receive the notice.

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6.

When can the mortgagee file for deficiency judgement?
- A.
  
  If the promissory note was made with a recourse clause.
- B.
  
  If the sale does not bring enough to pay existing balance of principal and fees.
- C.
  
  A & B
- D.
  
  None of the above.
Correct Answer
C. A & B

Explanation
The mortgagee can file for a deficiency judgement if the promissory note was made with a recourse clause, which means the borrower is personally liable for any remaining debt after foreclosure. Additionally, the mortgagee can also file for a deficiency judgement if the sale of the property does not bring in enough money to cover the outstanding balance of the loan and any associated fees. Therefore, the correct answer is A & B.

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7.

To improve a company's financial stability by establishing a safety measure that the firm can use to fill emergency needs, which of these must be present?
- A.
  
  Access to loans on ground
- B.
  
  Miscellaneous fund
- C.
  
  Contingency fund
- D.
  
  B & C
Correct Answer
C. Contingency fund

Explanation
A contingency fund is necessary to improve a company's financial stability by providing a reserve of funds that can be used to address emergency needs. This fund serves as a safety measure, allowing the company to handle unexpected expenses or financial setbacks without relying on external sources like loans. By having a contingency fund in place, the company can maintain its financial stability and avoid potential disruptions to its operations.

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8.

What is a two-to-four family property?
- A.
  
  A structure that ensures living space for two to four families and ownership is held in more than one deed.
- B.
  
  A residential property that provides dwelling units for two to four families while ownership is held in a single deed.
- C.
  
  A residential property that provides two to four dwelling units for members of the family.
- D.
  
  None of the above.
Correct Answer
B. A residential property that provides dwelling units for two to four families while ownership is held in a single deed.

Explanation
A two-to-four family property refers to a residential property that has dwelling units specifically designed for two to four families. In this case, the ownership of the property is held in a single deed, meaning that all the units within the property are owned by the same person or entity. This is different from the other options provided, as they either involve multiple deeds or do not specify the number of dwelling units for families.

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9.

What is the purpose of Regulation Z?
- A.
  
  It helps to know the true cost of obtaining credit.
- B.
  
  Discloses cost of commercial loans only.
- C.
  
  Helps to control the interest rates.
- D.
  
  A & C
Correct Answer
A. It helps to know the true cost of obtaining credit.

Explanation
Regulation Z, also known as the Truth in Lending Act, requires lenders to provide consumers with clear and accurate information about the costs and terms of credit. It ensures that consumers have access to important information such as the annual percentage rate (APR), finance charges, and terms of repayment. By knowing the true cost of obtaining credit, consumers can make informed decisions and compare different credit options. This regulation applies to both consumer and commercial loans, making option A the correct answer.

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10.

Through which of these do insurance companies usually make loans?
- A.
  
  Mortgage companies.
- B.
  
  Loan associations.
- C.
  
  VA
- D.
  
  FHA
Correct Answer
A. Mortgage companies.

Explanation
Insurance companies usually make loans through mortgage companies. Mortgage companies specialize in providing loans for purchasing real estate, and insurance companies often collaborate with them to offer financing options to their customers. This partnership allows insurance companies to diversify their investment portfolio and generate additional revenue through interest payments on these loans. Loan associations, VA, and FHA are not typically involved in providing loans for insurance companies.

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