Valuation and Financing Practice Question
Question
A property manager is preparing a written response involving adjustable-rate loans. The parties need a practical answer before moving forward. Which answer best applies the rule? (Item 91)
Answer choices
- A. It allows a salesperson to act independently of the responsible broker.
- B. It shifts all responsibility to escrow and eliminates the broker’s duties.
- C. Recognize index, margin, adjustment period, and caps.
- D. It makes oral promises enforceable in every real estate transaction.
Correct Answer
C. Recognize index, margin, adjustment period, and caps.
Explanation
The correct answer is C because adjustable-rate loans requires candidates to recognize index, margin, adjustment period, and caps. The other options overstate the effect of custom, oral agreement, escrow, or independent salesperson action and do not reflect safe California exam practice.
Question details
- Difficulty: easy
- Domain: Valuation and Financing
- Objective: adjustable-rate loans