CALIFORNIA REAL ESTATE – Chapter 7 (Property Disclosures) – Questions

#1. Under California Civil Code §1102, the Transfer Disclosure Statement (TDS) is required for the sale of:

All real property including commercial and industrial

Only single-family residences

Residential property of 1-4 units

Properties valued over $500,000 only

#2. Which of the following property transfers is EXEMPT from the TDS requirement under Civil Code §1102.2?

A standard residential sale between private parties

A sale by an owner-occupant who has lived in the property for more than 5 years

A transfer by a court-ordered sale such as probate or foreclosure

A transfer involving seller financing

#3. The Natural Hazard Disclosure (NHD) statement required under Civil Code §1103 must disclose whether the property is located in:

Only earthquake fault zones

Areas with registered sex offenders

A special flood hazard area, seismic hazard zone, or wildfire severity zone

Neighborhoods with high crime rates

#4. A seller completes the TDS and checks ‘No’ for all known defects. The buyer later discovers a major plumbing issue the seller knew about. The buyer may:

Do nothing because the TDS was completed

Only file a complaint with the HOA

Rescind the transaction or sue for damages based on the seller’s failure to disclose a known material defect

Request a reduced commission from the listing agent

#5. Under federal law, the Lead-Based Paint Disclosure is required for residential properties built before:

1990

1960

1978

2000

#6. Which of the following is TRUE about the Lead-Based Paint Disclosure requirement?

Lead paint testing is mandatory before any sale can close

Only the buyer’s agent is responsible for providing the disclosure

The buyer must be given a 10-day period to conduct a lead-based paint inspection, which can be waived

The disclosure is only required for properties with children under 6

#7. A seller’s agent knows that a licensed contractor told the seller the roof has 2 years of remaining life but the seller did not include this on the TDS. The agent must:

Disclose the roof condition to the buyer because the agent has actual knowledge of a material defect

Wait for the buyer’s inspector to discover the issue

Only disclose if the buyer asks about the roof specifically

Advise the seller to get a second opinion before disclosing

#8. Under California law, which of the following is NOT a natural hazard that must be disclosed on the NHD statement?

Location within a special flood hazard area

Location within a seismic hazard zone

The presence of a registered sex offender in the neighborhood

Location within a high fire severity zone

#9. The Mello-Roos Community Facilities District disclosure is required to inform buyers about:

The property’s proximity to parks and recreation facilities

Special tax assessments for community infrastructure that will be a continuing obligation

The seller’s obligation to pay property taxes at closing

The availability of public transportation near the property

#10. A home built in 1965 is being sold. The seller claims there is no lead paint because the home was repainted 10 years ago. Which statement is CORRECT?

The seller is correct and no disclosure is needed

Repainting does not eliminate the lead paint disclosure requirement; the disclosure is still required because the home was built before 1978

The disclosure is waived if the home has been repainted within 20 years

Only a verbal disclosure about the repaint is needed

#11. Under California Civil Code §1102.6, the TDS form requires the seller to disclose:

Only defects discovered during a professional inspection

Only defects that cost more than $5,000 to repair

Defects in neighboring properties

Known defects related to the property’s structural components, plumbing, electrical, roof, and other systems

#12. Which of the following statements about mold disclosure in California is TRUE?

Mold disclosure is required by Civil Code §1102.7

Mold only needs to be disclosed if it covers more than 100 square feet

Mold disclosure is only required for commercial properties

California does not have a specific statute mandating mold disclosure, but agents must disclose known mold as a material fact

#13. A property is located in a designated earthquake fault zone. Under the NHD requirements, who is responsible for providing this disclosure?

The buyer’s agent is solely responsible

The county assessor provides the disclosure at closing

The escrow company generates the disclosure automatically

The seller or seller’s agent must provide the NHD statement disclosing the earthquake fault zone

#14. An agent discovers during a showing that the property has visible signs of water damage on the ceiling. The TDS completed by the seller did not mention water damage. The agent should:

Ignore it because the seller completed the TDS

Disclose the visible water damage to the buyer and recommend further investigation

Cover the water damage with staging furniture

Only mention it if the buyer asks about ceiling stains

#15. Under California law, the Preliminary (Title) Report is provided to:

The seller only, as a summary of their ownership history

The buyer, to disclose the current condition of title including liens, encumbrances, and easements

The DRE as part of the licensing audit

The county recorder for tax assessment purposes

#16. Which of the following is a disclosure requirement specific to properties located near a military ordnance location?

Military ordnance disclosure is only required within 100 feet

This disclosure is only required for commercial properties

Military ordnance locations are disclosed through the NHD only

The seller must disclose if the property is within 1 mile of a former federal or state ordnance location

#17. A seller provides a TDS indicating ‘unknown’ for several items including foundation condition and plumbing. A buyer’s agent should advise the buyer to:

Accept the TDS as adequate since the seller disclosed their lack of knowledge

Waive the inspection contingency to make the offer more competitive

Obtain professional inspections for all areas marked as ‘unknown’ to assess the property’s true condition

Rely on the NHD report instead of independent inspections

#18. Under California law, which of the following must be disclosed if the property is located in a designated flood zone?

Only that the property is near a body of water

The property’s location within a Special Flood Hazard Area and the requirement for flood insurance if federally-backed financing is used

The flood zone designation is only disclosed if the buyer has flood insurance

Flood zone disclosure is optional for residential sales

#19. The smoke detector compliance statement required in California residential sales confirms that:

The property has operable smoke detectors installed in required locations per Health and Safety Code §13113.8

The property has a fire suppression sprinkler system

The seller has purchased fire insurance

Carbon monoxide detectors are not required

#20. A seller fails to disclose that the property was used as a methamphetamine lab but has been remediated. Under California disclosure law:

No disclosure is needed if the property has been remediated

Disclosure is only required if the buyer has children

The listing agent has no obligation to research prior drug activity

The seller must disclose this fact because prior illegal drug manufacturing is a material fact regardless of remediation

#21. Under California Health and Safety Code §25359.7, an owner must disclose:

Only asbestos contamination

Known or suspected releases of hazardous substances on the property

Only lead paint contamination

Hazardous substances within 5 miles of the property

#22. Which of the following is TRUE about the disclosure of a death on a property in California?

All deaths on the property must be disclosed regardless of when they occurred

Deaths from AIDS/HIV must be specifically disclosed

Death disclosures are only required for violent deaths

Under Civil Code §1710.2, a death on the property must be disclosed if it occurred within 3 years of the offer

#23. A property has an unpermitted addition that was completed by the previous owner 15 years ago. The current seller must:

Disclose the unpermitted addition on the TDS if they have knowledge of it

Not disclose because the addition was completed more than 10 years ago

Only disclose if the addition is visible from the street

Disclose only if asked directly by the buyer

#24. Under California law, the Water Heater Bracing Statement confirms:

The water heater is less than 5 years old

The water heater meets energy efficiency standards

The water heater has been inspected by a licensed plumber

The water heater is braced, anchored, or strapped in compliance with seismic safety standards

#25. A buyer’s agent discovers that the property is near a recently closed landfill. This information is:

Not relevant because the landfill is closed

Only disclosable if the buyer asks about environmental issues

Only important for commercial property transactions

A material fact that must be disclosed to the buyer as it may affect property value and health

#26. Which of the following disclosures must be provided for properties in California regardless of the property’s age?

The Lead-Based Paint Disclosure

The asbestos disclosure

The underground storage tank disclosure

The Natural Hazard Disclosure (NHD) statement

#27. Under California law, the Carbon Monoxide Detector compliance applies to:

All existing single-family homes with fossil fuel-burning appliances or attached garages

Only commercial buildings

Only newly constructed homes built after 2010

Homes with more than 3 bedrooms only

#28. A seller completes the TDS and indicates that the property has a septic system. The seller’s disclosure obligation includes:

Only stating that a septic system exists

The known condition and maintenance history of the septic system, including any failures or permits

The contact information for the septic company used by the seller

A guarantee that the septic system will function for 5 years after closing

#29. Under federal and California law, the Residential Environmental Hazards booklet must be provided to buyers:

For all residential property sales regardless of age

When the property was built before 1978, as part of the Lead-Based Paint Disclosure requirement

Only for properties in designated environmental hazard zones

Only when the buyer requests it

#30. A listing agent hires a third-party company to prepare the NHD report. If the report contains an error, who is liable?

The third-party NHD company may be liable, but the listing agent and seller may also bear responsibility depending on their actual knowledge

Only the third-party NHD company

Only the listing agent

Nobody, because NHD errors are considered harmless

#31. Which of the following is TRUE about the disclosure of asbestos in California residential property sales?

There is no specific California statute requiring asbestos disclosure, but agents must disclose known asbestos as a material fact

Asbestos disclosure is required by Civil Code §1102.5 for all residential properties

Asbestos disclosure is only required for properties built after 1990

Only commercial property sellers must disclose asbestos

#32. A buyer receives the TDS and NHD reports but does not read them before making an offer. If the buyer later discovers a disclosed defect:

The buyer can rescind because they did not actually read the disclosures

The seller must provide the disclosures again in person

The listing agent must verbally summarize all disclosures for the buyer

The buyer generally cannot claim lack of knowledge because the disclosures were provided and the buyer had a duty to read them

#33. Under California law, a home inspection report prepared by a licensed inspector:

Is legally required before any residential sale can close

Must be filed with the county recorder

Replaces the seller’s TDS obligation

Is typically obtained by the buyer and is advisory only; it does not guarantee the property’s condition

#34. The pest control inspection report (Wood Destroying Pest Report) in California:

Is required by California law for all residential sales

Only covers termite damage, not other pests

Is only required for properties with wood framing

Identifies active infestations and conditions likely to lead to infestation, categorized as Section 1 and Section 2 items

#35. Under California Civil Code §1102.4, when a seller delivers the TDS, the buyer has:

No right to rescind once the TDS is signed

30 days to review and rescind

The right to rescind only if the TDS reveals a major structural defect

The right to rescind within a specified period (typically 3 days for personal delivery or 5 days for mail delivery) after receiving the TDS

#36. A property inspection reveals radon levels above the EPA action level of 4 pCi/L. Under California disclosure requirements:

Radon is not a concern in California and no disclosure is needed

Disclosure is only required if levels exceed 10 pCi/L

Only the seller is responsible for radon testing and disclosure

The agent must disclose the elevated radon levels to the buyer as a material fact and recommend mitigation

#37. Which of the following statements about the Supplemental Property Tax disclosure is TRUE?

Buyers must be informed that a change in ownership may trigger a supplemental property tax assessment based on the new purchase price

Supplemental property taxes only apply to commercial properties

Supplemental taxes are included in the standard annual tax bill

The seller is responsible for paying all supplemental taxes

#38. Under California law, which disclosure is required when a property is located in a designated zone for potential dam inundation?

The NHD statement must disclose the property’s location within a potential dam inundation zone

Dam inundation zones are only disclosed for properties within 500 feet of a dam

This disclosure is only required for commercial properties

Dam inundation disclosure is handled by the federal government only

#39. A seller discloses on the TDS that the HVAC system ‘works fine.’ The buyer moves in and discovers the system has not been maintained for 10 years and fails. The seller may be liable for:

Nothing, because the seller stated it works fine and made no warranty

Only the cost of an HVAC inspection

Misrepresentation if the seller knew or should have known the HVAC system was failing

Only if the system fails within 30 days of closing

#40. Under California law, a real estate agent who negligently fails to disclose a known material defect may be liable for:

A maximum fine of $500 only

Only a written warning from the DRE

No liability if the seller also failed to disclose

Damages to the buyer, disciplinary action by the DRE, and potential loss of license

#41. Which of the following is TRUE about zoning disclosure in California?

Zoning disclosures are only required for commercial sales

The city planning department provides all zoning disclosures directly to buyers

Zoning is always disclosed through the NHD report

While there is no specific zoning disclosure statute, agents must disclose known zoning issues that materially affect the property

#42. A property with a swimming pool is being sold. Under California disclosure requirements, the seller must disclose:

Only that a pool exists on the property

The pool’s original construction cost

Whether the pool and safety barriers comply with current California pool safety requirements

Whether the pool has been used for competitive swimming

#43. Under California law, the seller’s agent must provide which of the following documents to the buyer?

The seller’s credit report

The listing agent’s commission agreement

The Agent Visual Inspection Disclosure (AVID) describing the results of the agent’s own visual inspection

The broker’s errors and omissions insurance policy

#44. A buyer’s agent discovers that a property listed as having 2,400 square feet actually measures only 2,100 square feet. The agent must:

Disclose the square footage discrepancy to the buyer as it affects property value and the accuracy of the listing

Not disclose because square footage is the appraiser’s responsibility

Only disclose if the buyer specifically asks about square footage

Adjust the offer price silently without informing the buyer

#45. Which of the following is TRUE about the disclosure of homeowners association (HOA) documents in California?

HOA documents are only required for condominiums, not planned unit developments

The buyer must obtain HOA documents independently

The seller must provide the buyer with HOA governing documents, financial statements, and any pending special assessments

HOA disclosures are optional if the buyer has no questions

#46. Under California Civil Code §1103.4, the seller or seller’s agent may use a third-party report to fulfill NHD obligations. If the report is inaccurate:

The listing agent is always personally liable for NHD errors

The seller is automatically liable regardless of good faith reliance

The escrow company assumes liability for NHD errors

The person or company preparing the report may be liable, and the seller and agent may be protected if they relied on the report in good faith

#47. A property was built in 1975 and has original electrical wiring. The seller’s TDS does not mention the wiring. A buyer’s agent who notices outdated wiring should:

Inform the buyer about the potential issue and recommend a licensed electrician conduct a thorough inspection

Rewire the property before the buyer makes an offer

Ignore the wiring because it was the standard when the home was built

Only mention it if the seller confirms it is original

#48. Under California law, the Earthquake Fault Zone Disclosure is required when the property is located:

Within a designated Alquist-Priolo Earthquake Fault Zone

Within 50 miles of any known earthquake fault

In any county that has experienced an earthquake in the past 100 years

Only when the property has sustained earthquake damage

#49. Which of the following is NOT required on the Transfer Disclosure Statement (TDS)?

Known defects in the roof and ceilings

The seller’s original purchase price of the property

Information about room additions or structural modifications

The presence of environmental hazards such as lead paint or asbestos

#50. A seller discloses on the TDS that there is minor settling in the foundation. During the inspection, the inspector finds the settling is moderate and worsening. The buyer can:

Do nothing because the seller already disclosed settling

Only request a $500 credit for the difference

Use this new information to renegotiate or cancel the contract within the contingency period

Sue the inspector for misdiagnosis

#51. Under California law, which of the following is TRUE about the Smoke Detector Statement of Compliance?

The seller must provide a written statement confirming that smoke detectors are properly installed and operable

Smoke detectors are only required in homes built after 2000

The buyer is responsible for installing smoke detectors after closing

The statement of compliance is optional for owner-occupied properties

#52. A listing agent discovers that the property’s sewer line is connected to the public sewer system but the TDS indicates a septic system. The agent must:

Leave the TDS as-is because the seller completed it

Only correct it if the buyer’s agent asks about the sewer connection

Wait for the home inspection to reveal the true connection

Correct the inaccuracy and ensure the proper disclosure is made to potential buyers

#53. Under California Civil Code §2079.7, which of the following is TRUE about the buyer’s right to independently inspect the property?

The buyer must use an inspector recommended by the seller’s agent

The buyer’s right to inspect is waived if the seller provides a TDS

The buyer can only inspect after the close of escrow

The buyer has the right to have the property inspected by a professional of the buyer’s choosing

#54. A property inspection reveals that the garage was converted to a bedroom without permits. This is considered:

Not a disclosure issue because the conversion has been in place for years

An unpermitted improvement that must be disclosed to the buyer as it may affect value, insurance, and legal compliance

Only a problem if the buyer plans to convert it back to a garage

A minor issue that only the city building department needs to know about

#55. Which of the following environmental hazards requires disclosure under California Health and Safety Code?

Air pollution levels in the general area

Traffic noise measurements on adjacent streets

Known contamination from underground storage tanks on the property

Average temperatures in the neighborhood

#56. Under California law, a seller who deliberately conceals a known defect by covering it up (such as painting over water damage) may be liable for:

Only the cost of repainting the affected area

A maximum penalty of $1,000

Nothing if the buyer’s inspector fails to discover the cover-up

Fraud, which may include punitive damages in addition to compensatory damages

#57. The Homeowner’s Guide to Earthquake Safety booklet must be provided by the seller in which situation?

When selling any residential property regardless of age

Only for properties that have sustained earthquake damage

Only when selling in a designated Alquist-Priolo fault zone

When selling residential property built before January 1, 1960

#58. A buyer receives the NHD report showing the property is in a high fire severity zone. The buyer’s agent should advise the buyer to:

Ignore the disclosure because fire zones are common in California

Only concern themselves with fire insurance if a wildfire has occurred in the past year

Withdraw the offer immediately

Investigate fire insurance availability and cost, review defensible space requirements, and consider evacuation routes

#59. Under California law, which of the following statements about pest control inspections is CORRECT?

Section 1 and Section 2 designations have no legal significance

Section 1 items involve active infestations requiring immediate treatment; Section 2 items are conditions likely to lead to infestation

Pest control inspections are mandatory for all California residential sales by law

Only licensed real estate agents may perform pest control inspections

#60. A seller provides a TDS disclosing that there was a water leak in the bathroom 5 years ago that was repaired. The seller’s disclosure obligation is:

Not satisfied because the seller must also guarantee no future leaks

Satisfied for the water leak as long as the disclosure is accurate and complete regarding the repair

Only complete if the seller provides the contractor’s warranty

Not complete until the buyer signs a waiver

#61. Under the Real Estate Transfer Disclosure Statement, the seller must disclose known defects related to:

Only cosmetic issues such as paint color and landscaping

The structural, mechanical, plumbing, and electrical components of the property

Only defects that reduce the property value by more than 10%

Only defects discovered by a licensed inspector

#62. Which of the following is a required disclosure when a property has an in-ground swimming pool in California?

The pool’s age and brand of pump

Whether the property has proper pool barriers, gates, and safety features as required by law

The pool’s water chemistry test results

How often the pool is cleaned

#63. A listing agent discovers that the property is in a Liquefaction Zone. This information must be disclosed:

On the Natural Hazard Disclosure (NHD) statement as it affects seismic risk

Only if the buyer is purchasing earthquake insurance

Only for commercial properties

Only if the property has previously suffered liquefaction damage

#64. Under California law, the Database Disclosure (Megan’s Law) informs buyers that:

All neighbors have passed background checks

The neighborhood has no registered sex offenders

The buyer may check a database of registered sex offenders maintained by the Department of Justice

The seller guarantees no registered sex offenders live within a mile

#65. A seller’s agent discovers that the basement has efflorescence (white mineral deposits) on the walls, suggesting moisture intrusion. The TDS does not mention moisture. The agent should:

Paint over the efflorescence before the next showing

Ignore it because efflorescence is purely cosmetic

Only mention it if the buyer has a moisture contingency

Disclose the observation to potential buyers and recommend further investigation by a qualified professional

#66. Under California law, which of the following is TRUE about the Commercial Property Owner’s Guide to Earthquake Safety?

California law does not require this disclosure for standard residential 1-4 unit sales

It is required for all property sales in California

It replaces the NHD statement for commercial transactions

It is provided by the city building department

#67. A property has a known radon problem that has been mitigated with a ventilation system. The seller must:

Only disclose that a ventilation system exists

Disclose both the radon problem and the mitigation system on the TDS

Not disclose because the problem has been mitigated

Only disclose to the buyer’s lender

#68. Which of the following is TRUE regarding the timing of the seller’s delivery of the TDS?

The TDS must be delivered at least 30 days before closing

The TDS is only required after the buyer’s offer is accepted

The TDS should be provided as soon as practicable, but no later than the time specified in the purchase agreement

The TDS may be delivered at any time before the close of escrow

#69. Under California law, an agent who provides a buyer with the wrong NHD report (for a different property) may face liability for:

Nothing, because NHD errors are covered by the title company

Only a DRE reprimand

Negligence and potential damages if the buyer relies on incorrect hazard information

Only if the buyer suffers actual flood or earthquake damage

#70. A seller knows that the neighbors plan to build a second-story addition that will block the listed property’s view. This information is:

Not disclosable because it involves a neighbor’s property

Only relevant if the construction has already started

Only disclosable if the buyer specifically asks about views

A material fact that should be disclosed because it may significantly affect the property’s value and desirability

#71. Under California Civil Code §1102.3, which of the following professionals are exempt from the TDS requirement when acting as a seller?

A licensed real estate agent selling their personal residence

A builder selling newly constructed homes with warranties

A court-appointed trustee in a bankruptcy sale

A property manager selling a property they manage

#72. The Window Security Bars disclosure in California requires sellers to:

Remove all window security bars before sale

Only disclose if the bars are on bedroom windows

Disclose only if the home was built before 1980

Disclose the presence of window security bars and confirm they have safety release mechanisms

#73. A buyer asks their agent whether the property is in a flood zone. The buyer’s agent:

Should check the NHD report and disclose all known flood zone information

May say ‘I don’t know’ and defer to the seller

Should advise the buyer that flood zones are irrelevant in California

Should only answer if they are a certified floodplain manager

#74. Under California Health and Safety Code, an owner of residential property must disclose:

Only federally-regulated hazardous substances

Any known release of hazardous substances that has occurred on or beneath the property

Only substances found during a Phase II environmental assessment

Hazardous substances within 1,000 feet of the property

#75. Which of the following is TRUE about the disclosure of utility costs for a property in California?

Sellers must provide 3 years of utility bills

Utility cost disclosure is required under Civil Code §1102.6a

The listing agent must personally verify all utility costs

There is no specific statute requiring utility cost disclosure, but agents should recommend buyers research utility costs independently

#76. A property has an underground heating oil tank that was decommissioned 20 years ago. The seller must:

Disclose the existence and decommissioning of the underground tank as a potential environmental concern

Not disclose because the tank was decommissioned more than 10 years ago

Only disclose if the buyer plans to dig in the yard

Only disclose to the environmental agency

#77. Under California law, the Industrial Use Disclosure applies when:

The property itself was previously used for industrial purposes only

The property is adjacent to a factory

A property is located within 1 mile of a facility that reports hazardous waste releases

Only commercial properties near industrial zones are covered

#78. A buyer receives a pest control report showing Section 1 findings (active termite infestation). The purchase agreement states the seller will pay for Section 1 repairs. If the seller refuses to pay:

The buyer must pay for all repairs themselves

The listing agent must pay for the repairs

The buyer may exercise their right under the contract to negotiate, request repairs, or cancel the transaction within the contingency period

The escrow company deducts repair costs from the seller’s proceeds automatically

#79. Under California law, the Local Option Real Estate Transfer Disclosure is required in:

Cities or counties that have adopted additional local disclosure requirements beyond state requirements

All California jurisdictions uniformly

Only counties with populations over 500,000

Only cities with rent control ordinances

#80. A property built in 1972 is being sold. The seller claims ‘I never tested for lead paint so I don’t know if there is any.’ Under the lead paint disclosure requirements:

The seller must still provide the lead paint disclosure form and indicate their lack of knowledge; the buyer must be given the EPA pamphlet and the opportunity to test

The seller is exempt from the disclosure because they have no knowledge of lead paint

The seller must test for lead paint before the sale can proceed

The listing agent must personally test for lead paint

#81. Which of the following is TRUE about California’s water heater and smoke detector disclosures?

They are only required for new construction

Both are required compliance disclosures that must be confirmed in writing before close of escrow

They are optional disclosures the seller may choose to provide

They are only required for properties financed with FHA loans

#82. A listing agent prepares the Agent Visual Inspection Disclosure (AVID) after walking through the property. The AVID must include:

The agent’s observations from a reasonably competent visual inspection of accessible areas

Results from professional engineering or structural assessments

A guarantee that no hidden defects exist

Only observations the seller has authorized the agent to disclose

#83. Under California law, which disclosure informs the buyer about the potential for supplemental property taxes after a change in ownership?

The Natural Hazard Disclosure

The Transfer Disclosure Statement

The Closing Disclosure

The Supplemental Property Tax Notice

#84. A seller provides a TDS that states ‘Property is in excellent condition.’ If the property has multiple code violations that the seller is aware of, this constitutes:

An acceptable statement because the seller is expressing their opinion

A harmless exaggeration common in real estate

A material misrepresentation that may expose the seller and listing agent to liability

A violation only if the buyer relied on the statement

#85. Under California law, which of the following must be disclosed regarding the property’s energy efficiency?

The monthly cost of electricity for the past 5 years

The property’s carbon footprint calculation

The energy star rating of all appliances

The Energy Compliance Certificate for any work requiring a building permit

#86. A buyer discovers after closing that the seller knew about recurring flooding in the basement but marked ‘No’ on the TDS. The buyer’s legal remedy includes:

Filing a complaint with the MLS

Requesting a refund of the home inspection fee

Suing the seller for fraud and rescission based on intentional concealment of a known material defect

Contacting the county building department for a fine

#87. Which of the following is TRUE about California’s Statewide Buyer and Seller Advisory (SBSA)?

It is a legally required disclosure that must be signed by all parties

It is an advisory document that informs buyers and sellers about various disclosure obligations and property-related issues

It replaces the TDS for properties built after 2000

It is prepared by the county assessor

#88. Under California law, a property inspection report that identifies potential mold contamination should prompt the agent to:

Ignore the finding because mold is common and not a health hazard

Disclose the finding to the buyer and recommend specialized mold testing by a qualified professional

Tell the buyer that mold is the seller’s problem to fix

Wait for the appraiser to note the mold in the appraisal

#89. A seller discloses on the TDS that ‘the roof was replaced 5 years ago.’ The seller does not mention that the roofing contractor is under investigation for substandard work. Is this a disclosure issue?

No, because the seller disclosed the roof replacement

Only if the buyer specifically asks about the contractor

Yes, if the seller knows about the investigation, it is a material fact that should be disclosed as it may affect the roof’s integrity

Only if the roof has already shown signs of failure

#90. Which of the following represents a proper response by a listing agent who discovers unpermitted electrical work during their visual inspection?

Ignore it because the agent is not an electrician

Tell the buyer it is probably up to code

Remove the finding from the AVID to avoid alarming the buyer

Disclose the observation on the AVID and recommend the buyer obtain an electrical inspection by a licensed electrician

#91. Under the California Environmental Hazards booklet requirement, which professionals must provide the booklet to the buyer?

The seller’s agent and the buyer’s agent are both responsible for ensuring the buyer receives the booklet

Only the seller provides the booklet

Only the buyer’s agent provides the booklet

The escrow company provides the booklet at closing

#92. A property inspection reveals that the property has polybutylene plumbing, which is known to fail. The listing agent’s disclosure obligation includes:

Not disclosing because polybutylene was legal when installed

Only disclosing if the plumbing has already failed

Disclosing only to the buyer’s lender for insurance purposes

Disclosing the presence of polybutylene plumbing as a known material defect that may require replacement

#93. Under California law, which of the following is TRUE about the Seller’s Affidavit of Nonforeign Status (FIRPTA)?

It is a California state disclosure about the seller’s immigration status

It is only required for properties sold to foreign buyers

It is a federal tax disclosure in which the seller confirms they are not a foreign person for purposes of withholding requirements

It is provided by the county tax assessor

#94. A buyer’s agent discovers that the property has a history of flooding from a nearby creek, but the NHD does not list it as a flood zone. The agent should:

Rely solely on the NHD report and say nothing

Advise the buyer that the NHD is always accurate and no further investigation is needed

Disclose the flooding history to the buyer as a known material fact regardless of the NHD designation

Only disclose if the creek is visible from the property

#95. The pest control report for a California residential sale identifies Section 2 conditions. Section 2 conditions are defined as:

Active infestations requiring immediate treatment

Conditions caused by dry rot only

Conditions that have been previously treated and are no longer active

Conditions that are deemed likely to lead to infestation or infection but do not involve active infestation

#96. Under California law, if a buyer does not receive the TDS before making an offer, the buyer:

Is permanently bound by the offer regardless

Must wait 30 days to rescind

May rescind the offer within 3 days of personal delivery of the TDS or 5 days if delivered by mail

Can only rescind if the TDS reveals a defect costing more than $10,000

#97. A seller’s TDS indicates that the property has no known environmental hazards. However, the listing agent observes what appears to be asbestos insulation in the attic. The agent must:

Rely on the seller’s TDS and say nothing

Test the material personally to determine if it is asbestos

Disclose only after the buyer has removed all contingencies

Disclose the potential asbestos to the buyer and recommend professional testing by a certified environmental specialist

#98. Under California law, which of the following is TRUE about disclosure requirements for newly constructed homes?

Newly constructed homes have no disclosure requirements

Newly constructed homes may be exempt from the TDS but are subject to builder warranty disclosures

All disclosure requirements for newly constructed homes are the same as for resale homes

Only the NHD is required for new construction

#99. A property has a shared driveway with the neighboring property. The seller must disclose:

Nothing, because shared driveways are common and not material

The shared driveway arrangement, including any maintenance agreements or easements, as a material fact

The shared driveway only if there is a current dispute with the neighbor

The shared driveway only on the title report, not the TDS

#100. Under California law, which disclosure form specifically addresses whether the property is in a zone where wildfires are a risk?

The TDS includes a specific wildfire section

The Natural Hazard Disclosure (NHD) statement includes wildfire severity zone information

A separate Cal Fire disclosure form is required

Wildfire risk is only disclosed through homeowner’s insurance documentation

#101. A listing agent discovers that the property’s well water has tested positive for bacteria. The agent’s duty to disclose includes:

Only disclosing if the buyer plans to use well water for drinking

Not disclosing because well water quality fluctuates and may improve

Informing all potential buyers of the contaminated well water test results as a material health and safety concern

Disclosing only to the buyer’s lender

#102. Under California Civil Code §1103.2, which of the following is a statutory exemption from the NHD requirement?

A standard sale of a single-family home

A sale of a condominium in a high-rise building

A transfer pursuant to a court order, such as probate or foreclosure

A transfer between unrelated parties

#103. Under California law, a home seller must provide a completed Smoke Detector Statement of Compliance for properties with:

Only multi-family dwellings with 5 or more units

Only properties with fireplaces

All residential properties upon transfer of title

Only properties built before 1990

#104. Which of the following is TRUE about disclosure of homeowners insurance claims history in California?

Sellers must provide 10 years of insurance claim history

While not specifically required by statute, the seller should disclose prior insurance claims if they relate to material defects

Insurance claims history is only available through the buyer’s lender

Insurance claims cannot be disclosed due to privacy laws

#105. A property has Chinese drywall installed during a renovation in 2006. Under disclosure law, the seller must:

Not disclose because the drywall was installed legally

Disclose the Chinese drywall as a known defect because it can cause corrosion and health issues

Only disclose if the buyer asks about building materials

Disclose only if the drywall has already caused visible damage

#106. Under California law, the Seismic Hazard Zone disclosure on the NHD applies to properties located in:

Any property within 100 miles of a fault line

Areas identified by the California Geological Survey as having potential for earthquake-induced landslides or liquefaction

Only coastal properties subject to tsunamis

Only hillside properties above 1,000 feet elevation

#107. A seller discloses that the property had a minor termite treatment 3 years ago. During the pest inspection, the inspector finds a new active infestation in a different area. The seller:

Has satisfied their initial disclosure obligation but should update the TDS to reflect the new findings if they learn of them

Is liable for the new infestation because they had prior termite issues

Must pay for all treatment because of the prior infestation

Has no further obligation because they already disclosed prior treatment

#108. Under California law, which document notifies buyers that they should investigate whether a property has had any prior permits pulled for renovations?

There is no specific statutory form; however, agents should advise buyers to check with the local building department for permit history

The NHD report lists all prior permits

The TDS includes a section listing all permits ever obtained

The preliminary title report shows all building permits

#109. A listing agent notices brown stains around a bathroom vent during the visual inspection. The agent should:

Assume the stains are cosmetic and not include them in the AVID

Clean the stains before the next showing

Note the stains on the AVID and recommend the buyer investigate possible moisture intrusion or roof leak

Only report the stains if they are larger than 12 inches

#110. Under California law, the disclosure of proximity to an airport must be made when:

The property is within 2 miles of any airport

Only when the buyer asks about airport noise

Only for properties directly under a flight path

The property is in an area subject to airport influence as designated in the county or city general plan

#111. Which of the following is TRUE about the FHA/VA loan addendum disclosures in California?

FHA/VA disclosures replace the TDS entirely

FHA/VA disclosures are only required for new construction

FHA and VA loans have specific property condition requirements that the buyer and seller should be informed about

The lender provides all FHA/VA disclosures, not the agents

#112. A property has a registered conservation easement that limits development rights. The seller’s disclosure obligation includes:

Disclosing the conservation easement and its restrictions as material facts that limit the buyer’s use of the property

Not disclosing because the easement is recorded and the buyer can find it

Only disclosing if the buyer plans to develop the property

Disclosing only through the title report at closing

#113. Under California Civil Code §1102.155, sellers must disclose whether the property is within a:

City designated as a historic district

School district with below-average test scores

Zone where military ordnance was formerly used or stored

Redevelopment area

#114. A buyer’s agent discovers that the property’s address appears on the state’s list of registered environmental cleanup sites. The agent must:

Not disclose because the site is being cleaned up

Only disclose if the cleanup is not yet completed

Disclose this information to the buyer as it indicates potential contamination requiring further investigation

Wait for the Phase I report before making any disclosure

#115. Under California law, the Geological Hazard Zone Disclosure is part of which required disclosure document?

The Transfer Disclosure Statement (TDS)

The Natural Hazard Disclosure (NHD) statement

The Agent Visual Inspection Disclosure (AVID)

A standalone geological survey report

#116. A property has a functioning septic system that requires pumping every 3 years. The seller should disclose:

Only that the property is not connected to public sewer

The septic system’s existence, maintenance schedule, and any known issues or past failures

The exact cost of the last pumping

The name of the septic company only

#117. Which of the following is TRUE about the disclosure requirements for a condominium sale in California?

Condominium sales are exempt from all disclosure requirements

The seller must provide HOA governing documents, CC&Rs, financial statements, meeting minutes, and pending litigation disclosures

Only the TDS is required for condominium sales

HOA documents are provided by the buyer’s lender

#118. Under California law, the seller must disclose whether the property is subject to:

A mandatory membership in a neighborhood social club

Any special assessments, bonds, or improvement districts that create a financial obligation for the new owner

The seller’s personal debts unrelated to the property

The listing agent’s marketing budget

#119. A listing agent discovers that the property’s chimney has significant cracking during the visual inspection. The agent’s responsibility includes:

Disclosing the chimney cracking on the AVID and recommending a professional chimney inspection

Repairing the chimney before the next showing

Only disclosing if the cracking is visible from the ground level

Ignoring it because chimney condition is outside the scope of a visual inspection

#120. Under California law, which of the following is TRUE about the disclosure of a property’s location near a Superfund site?

Superfund disclosures are only required at the federal level

The agent must disclose proximity to a known Superfund site as a material environmental fact

The NHD automatically includes Superfund information

Superfund sites only affect commercial property disclosures

#121. A property has had two insurance claims for water damage in the past 5 years. This information:

Should be disclosed by the seller because it is a material fact that may indicate recurring water intrusion problems

Is private insurance information that cannot be disclosed

Only affects the buyer’s ability to obtain insurance, not the sale

Is only relevant if both claims were for the same issue

#122. Under California’s AB 1482 (Tenant Protection Act), which disclosure is required when selling a rental property?

Only the current rental income amount

The existence of any rent-controlled units and applicable tenant protections, including just cause eviction requirements

The tenant’s credit score

Whether the tenant has pets

#123. A seller knows the property was previously used as a funeral home but it was converted to residential use 20 years ago. The seller should:

Disclose the prior use as a funeral home because it may be considered a material fact to some buyers

Not disclose because the conversion occurred more than 10 years ago

Only disclose if the buyer is in the funeral business

Only disclose if the buyer asks about prior commercial uses

#124. Under California law, the requirement for carbon monoxide detectors applies to which residential properties?

Only properties with gas stoves

Only multi-unit residential buildings

All dwelling units with a fossil fuel-burning appliance, fireplace, or attached garage

Only properties built before 1990

#125. A buyer receives the NHD report which shows the property is NOT in a flood zone. However, the buyer’s agent knows from personal experience that the area floods during heavy rains. The agent should:

Disclose the personal knowledge of flooding to the buyer as it constitutes a known material fact

Rely solely on the NHD report and say nothing to the buyer

Advise the buyer to purchase flood insurance without explaining why

Only disclose if the seller also mentions flooding

#126. Under California law, which of the following is required when a property is located in a Very High Fire Hazard Severity Zone?

The seller must install a fire sprinkler system before sale

The property cannot be sold without a fire department inspection

The seller must disclose this designation and provide information about defensible space maintenance requirements

The buyer must waive all fire-related claims

#127. A property has an older heating system that uses a wall-mounted gas unit. The seller’s TDS indicates the heater works. The agent notices a gas odor. The agent should:

Immediately disclose the gas odor observation, recommend evacuation, and advise the seller to have the unit professionally inspected

Ignore the odor because gas smells are common with older heaters

Tell the buyer it is probably just the pilot light

Note it on the AVID but do not recommend any action

#128. Under California law, which of the following is TRUE about the disclosure of noise levels from nearby freeways or commercial operations?

While there is no specific noise disclosure statute, agents must disclose known noise issues as material facts

Noise levels must be professionally measured before disclosure

Noise from freeways is never considered a material fact

Only noise from airports requires disclosure

#129. A seller provides the TDS but intentionally omits information about a neighbor’s aggressive dogs that have attacked visitors. This omission:

May constitute a failure to disclose a material safety concern, potentially exposing the seller to liability

Is acceptable because neighbor issues are not disclosable

Is only a problem if the buyer has children

Is the neighbor’s responsibility, not the seller’s

#130. Under California law, the Window Security Bars disclosure specifically addresses:

Whether the bars are made of steel or iron

Whether bedroom windows with security bars have approved quick-release mechanisms for emergency exit

The aesthetic design of the security bars

Whether the bars were installed by a licensed contractor

#131. A buyer purchases a property and discovers post-closing that the property was in a Special Studies Zone (Alquist-Priolo) that was not disclosed. The buyer may:

Only file a complaint with the geological survey

Request a price reduction from the escrow company

Pursue legal action against the seller and agents for failure to provide the required NHD disclosure

Do nothing because the buyer should have checked independently

#132. Under California Civil Code §1102.6c, the listing agent’s visual inspection duty specifically excludes:

Areas that are not reasonably accessible, such as roofs, crawlspaces requiring special equipment, or locked areas

The kitchen and bathrooms

The exterior of the property

All areas that require walking on the property

#133. A property has a shared well with three neighboring properties. The seller’s disclosure obligation includes:

Only disclosing that the property has a well

Not disclosing the shared nature because it is recorded as an easement

Disclosing the shared well arrangement, water rights, maintenance agreements, and any known water quality or quantity issues

Only disclosing if a buyer specifically asks about water supply

#134. Under California law, which of the following environmental disclosures is required for properties near a former dry cleaning facility?

Dry cleaning proximity is never a material disclosure

Only the EPA provides disclosures about dry cleaning contamination

This disclosure is only required within 100 feet of the facility

The agent must disclose known contamination concerns as a material fact, as dry cleaning chemicals are common groundwater contaminants

#135. A listing agent discovers that the property has knob-and-tube electrical wiring in the attic. This discovery:

Must be disclosed as it may affect insurability, safety, and the buyer’s decision to purchase

Is not disclosable because knob-and-tube wiring was standard when installed

Should be concealed because it would reduce the property’s value

Only matters if the wiring is actively sparking

#136. Under California’s disclosure requirements, which of the following is TRUE about the Earthquake Hazards Reduction Act?

It requires all properties to have earthquake insurance

It mandates seismic retrofitting before any property can be sold

It requires sellers of properties built before 1960 to provide a residential earthquake hazards guide

It only applies to commercial buildings

#137. A seller’s TDS discloses a ‘minor’ crack in the exterior stucco. An inspector later determines the crack indicates structural settling. The buyer may:

Renegotiate or cancel within the contingency period based on the inspector’s findings about the severity

Do nothing because the seller disclosed a crack

Only request repair of the cosmetic appearance

Sue the inspector for an inaccurate report

#138. Under California law, the seller of a property in a Flood Hazard Boundary Area must disclose:

Only the distance to the nearest body of water

The date of the last flood in the area

The flood zone designation and the potential requirement for flood insurance if the buyer uses federally-backed financing

The cost of federal flood insurance

#139. A property sold in California has a home warranty plan offered by the seller. The warranty:

Eliminates the seller’s liability for all disclosed defects

Does not replace the seller’s legal obligation to disclose known defects on the TDS

Replaces the TDS requirement

Is only valid if the buyer purchases additional coverage

#140. Under California law, a buyer who discovers that the seller’s agent failed to conduct a visual inspection as required by Civil Code §2079 may:

Do nothing because the visual inspection is optional

Only file a complaint with the DRE

Sue the listing agent for negligence if the failure to inspect resulted in undiscovered material defects

Request a commission refund from the listing agent

#141. A property has a deed restriction limiting the exterior paint color to approved earth tones. The seller must:

Disclose the deed restriction as a material fact that affects the buyer’s use of the property

Not disclose paint restrictions as they are cosmetic

Only disclose if the buyer mentions wanting to paint the exterior

Wait for the title company to discover the restriction

#142. Under California law, which of the following is TRUE about seller’s disclosure obligations for properties that have been previously flooded?

Flooding need only be disclosed if it occurred within the last 2 years

The seller must disclose all known prior flooding events as material facts affecting the property’s condition and value

Flooding is only disclosed through the NHD

If the property was repaired after flooding, no disclosure is needed

#143. A listing agent notices evidence of wood rot around window frames during the visual inspection. The proper disclosure action is:

Document the observation on the AVID and recommend the buyer obtain a professional assessment

Replace the rotted wood before the next showing

Ignore it because wood rot is expected in older homes

Only disclose if the rot has caused structural damage

#144. Under California law, which of the following is TRUE about the Home Energy Rating System (HERS) disclosure?

HERS ratings are mandatory for all residential property sales in California

Only homes built after 2010 require HERS disclosure

HERS certificates may be required for certain energy-related improvements but are not generally required for all residential sales

HERS ratings replace the need for energy-efficient appliance disclosures

#145. A seller provides a TDS with information that later proves incorrect due to the seller’s honest mistake. The seller may be liable for:

Nothing, because honest mistakes are always excused

Negligent misrepresentation if the seller failed to exercise reasonable care in completing the TDS

Only if the buyer can prove the seller acted with malice

Only if the incorrect information related to structural defects

#146. Under California law, which professional report is MOST commonly used to identify potential soil contamination?

A Phase I Environmental Site Assessment

A property appraisal

A standard home inspection

A geological survey

#147. A buyer receives a TDS disclosing ‘previous water damage in the basement, repaired.’ The buyer should:

Accept the disclosure and proceed without further investigation

Investigate the extent and quality of the repair through a professional inspection before waiving contingencies

Demand the seller provide a 10-year warranty on the repair

Automatically reduce the offer price by 10%

#148. Under California law, a property located in a designated Wildland-Urban Interface Fire Area must have:

Compliant defensible space and may need to meet additional fire-safe building standards

A personal firefighting water supply

An on-site fire station

Fire insurance with a minimum coverage of $1 million

#149. The Transfer Disclosure Statement requires the seller to disclose information in which of the following categories?

Only cosmetic features and recent paint colors

Structural and mechanical systems, environmental hazards, and property condition including appliances and improvements

Only the purchase price and loan information

Only defects that were discovered by a licensed inspector

#150. Under California Civil Code §1103.1, which of the following natural hazards does NOT require disclosure on the NHD?

Special flood hazard areas

Proximity to a nuclear power plant

Seismic hazard zones

Very high fire hazard severity zones

#151. A buyer discovers post-closing that the seller’s agent knew about a pending eminent domain action that would take part of the property for a road widening project. The agent never disclosed this. The buyer may:

File a complaint with the highway department only

Request that the seller repurchase the property at the original price

Sue the agent for failure to disclose a material fact that significantly affects the property’s value and use

Do nothing because eminent domain is a public action

#152. Under California law, which of the following is TRUE about the Residential Lead-Based Paint Hazard Reduction Act?

It requires removal of all lead paint before a property can be sold

It requires sellers and landlords of pre-1978 housing to provide known lead paint information and the EPA pamphlet before sale or lease

It only applies to properties with children under 6 currently living in them

It is enforced by the California DRE

#153. A property has active litigation between the HOA and a neighboring developer over noise complaints. The seller must:

Not disclose because the litigation is between the HOA and a third party

Only disclose if the litigation is likely to result in a special assessment

Wait until the litigation is resolved before disclosing

Disclose the pending HOA litigation as it may affect property value and the buyer’s enjoyment of the property

#154. Under California law, which of the following is TRUE about the disclosure of presence of mold on a property?

Mold disclosures are only required if the mold covers more than 50 square feet

While California has no specific mold statute, known mold must be disclosed as a material fact under general disclosure principles

Mold is never considered a material defect in California

Only toxic black mold requires disclosure

#155. A seller provides the TDS indicating ‘no knowledge of soil problems.’ The buyer’s agent notices uneven floors and cracked interior walls. The agent should:

Accept the seller’s TDS at face value and not make further observations

Only mention the uneven floors if the buyer trips

Adjust the offer price without explaining the concerns to the buyer

Disclose these observations to the buyer and recommend a soil and foundation inspection by a qualified professional

#156. Under California law, when must the seller of a residential property provide the Mello-Roos disclosure?

Only at the close of escrow

Only if the buyer asks about special assessments

As soon as practicable before transfer of title, and the buyer must be informed of ongoing Mello-Roos special tax obligations

Within 30 days after closing

#157. A listing agent who fails to provide the required Lead-Based Paint Disclosure for a property built in 1970 may face:

Only a verbal warning from the DRE

A maximum fine of $100 under state law

No penalty if the property tests negative for lead paint

Federal penalties of up to $11,000 per violation, plus potential civil liability to the buyer

#158. Under California law, the disclosure of a property’s location within an Airport Influence Area must be made:

Only if the buyer specifically asks about airport proximity

Only for properties directly adjacent to the airport runway

Through the NHD or as a separate disclosure when the property is within the designated airport influence area

Only through the seller’s insurance company

#159. A property being sold has a registered historic designation that limits modifications. The seller’s disclosure includes:

Not disclosing because historic designation increases property value

Only disclosing if the buyer plans to renovate

Disclosing only through the title company

Informing the buyer of the historic designation and associated restrictions on renovations and alterations

#160. Under California law, the Seller Property Questionnaire (SPQ) provides information about:

Neighborhood and property-specific issues that may not be covered by the standard TDS, such as neighbor disputes and noise

Only the seller’s financial situation

Only the property’s assessed value

Only the seller’s reason for selling

#161. A buyer’s agent discovers that a property is located near high-voltage power transmission lines. This information:

Is not relevant because power lines are a public utility

Should be disclosed to the buyer as a material fact due to potential health concerns and impact on property value

Only matters if the buyer works from home

Is only disclosed through utility company records

#162. Under California law, the ‘as-is’ clause in a purchase agreement:

Eliminates all seller disclosure obligations

Means the buyer waives the right to inspect the property

Prevents the buyer from suing for undisclosed defects

Does NOT relieve the seller or agents of their statutory duty to disclose known material defects

#163. A listing agent discovers during the visual inspection that the property has evidence of previous fire damage that was repaired. The seller’s TDS does not mention the fire. The agent must:

Ignore it because the damage was repaired

Only disclose if scorch marks are visible

Disclose the evidence of previous fire damage on the AVID and bring it to the seller’s attention for TDS correction

Advise the seller to repaint to cover the evidence

#164. Under California law, a supplemental property tax assessment is triggered by:

A change in ownership or completion of new construction, resulting in a reassessment of the property

An annual adjustment for inflation

A request from the property owner

A decision by the county board of supervisors

#165. Which of the following is TRUE about the Statewide Buyer and Seller Advisory (SBSA) in California?

It is a mandatory document that must be signed before any offer can be accepted

It replaces all NHD requirements

It supplements statutory disclosures by providing advisory information about additional due diligence buyers and sellers should perform

It is issued by the California DRE

#166. A seller knows that the soil on the property contains elevated levels of naturally occurring arsenic. Under disclosure law:

Natural soil conditions do not require disclosure

Arsenic is only disclosed through EPA-mandated testing

The seller only needs to disclose if arsenic levels exceed federal limits

The seller must disclose this as a known environmental hazard that may affect health and use of the property

#167. Under California law, which of the following is TRUE about the real estate agent’s duty to disclose potential flooding from a nearby levee failure?

Levee failure risks are only disclosed by FEMA

Agents have no duty to disclose levee risks

Only the Army Corps of Engineers provides levee disclosures

If the agent knows or reasonably should know about the levee risk, it must be disclosed as a material fact

#168. A property with a solar energy system that is leased (not owned) by the seller requires:

Disclosure of the lease terms, monthly payments, transfer requirements, and any lien associated with the solar system

No disclosure because solar panels are considered fixtures

Only disclosure of the monthly energy savings

Disclosure only if the buyer plans to remove the panels

#169. Under California law, the Water-Conserving Plumbing Fixtures disclosure (SB 407) requires:

That all plumbing fixtures be replaced with water-conserving models before sale

Only new construction to comply with water conservation standards

That the seller disclose whether the property has water-conserving plumbing fixtures and noncompliant fixtures that must be replaced

That the buyer pay for all plumbing upgrades at closing

#170. A property is located near a facility that handles radioactive materials. The agent’s disclosure duty includes:

Not disclosing because radioactive facilities are regulated by the federal government

Disclosing the proximity to the radioactive materials facility as a material fact affecting health, safety, and property value

Only disclosing if the facility has had a safety violation

Disclosing only through the NHD report

#171. Under California’s disclosure requirements, a seller who has received a notice from the city about planned road widening that will affect the property must:

Disclose the notice as a material fact that will impact the property’s lot size, access, or value

Not disclose until the road widening actually begins

Only disclose if the widening will take more than 10 feet of the property

Wait for the city to notify the buyer directly

#172. A property has a granny flat (ADU) that was built with permits. The seller’s disclosure obligation includes:

Disclosing the ADU’s existence, permit status, and any rental income or use restrictions

Not disclosing because the ADU is permitted

Only disclosing the ADU’s square footage

Only disclosing if the buyer asks about additional dwelling units

#173. Under California law, what is the buyer’s remedy if the seller fails to deliver the TDS altogether?

The buyer must proceed with the purchase without the TDS

The buyer can only request a 5% reduction in price

The buyer must file a complaint with the DRE before terminating

The buyer may terminate the contract and recover their earnest money deposit

#174. A listing agent prepares the AVID after a visual inspection and notes ‘no apparent defects.’ During the buyer’s professional inspection, numerous defects are discovered. The listing agent may be liable if:

The defects were hidden behind walls or under floors

The buyer chose not to read the AVID

The defects were only discoverable with specialized equipment

The defects were reasonably visible during a competent visual inspection and the agent failed to observe and report them

#175. Under California law, which of the following applies to the disclosure of HOA pending litigation?

HOA litigation is confidential and cannot be disclosed

Only settled litigation must be disclosed

Litigation is only disclosed if the buyer is an attorney

The HOA must disclose pending or anticipated litigation in the HOA documents provided to the buyer

#176. A property has a history of subsidence (ground settling). Under California disclosure law:

The seller must disclose known subsidence issues as material facts that affect the structural integrity of the property

Subsidence is only disclosed through geological surveys

Subsidence is not considered a material defect

Only subsidence causing visible damage requires disclosure

#177. Under California law, the disclosure of the property’s flood zone status is based on:

The seller’s personal experience with flooding

Maps published by FEMA (Federal Emergency Management Agency) and local data

The buyer’s flood insurance carrier

The county assessor’s property records

#178. A buyer discovers that the seller’s TDS was completed by the listing agent instead of the seller. This is:

Acceptable as long as the agent accurately represented the property

Standard practice in California

Only a problem if the agent made errors

Improper because the TDS must be completed by the seller based on their personal knowledge of the property

#179. Under California law, the Home Inspection Notice must inform the buyer that:

The seller’s inspection is sufficient and no additional inspection is needed

The buyer has the right to obtain an independent home inspection and should not rely solely on the seller’s TDS

Only licensed engineers may perform home inspections

Home inspections must be completed within 24 hours of the offer

#180. A property has aluminum wiring, which is known to be a fire hazard in certain configurations. The disclosure obligation:

Does not exist because aluminum wiring was legal when installed

Requires the seller and agent to disclose known aluminum wiring as a material safety concern

Only applies if the wiring has caused a fire

Only applies to commercial buildings

#181. Under California law, which statement about the relationship between the TDS and property inspections is CORRECT?

Professional inspections replace the need for a TDS

The TDS and professional inspections serve different purposes; the TDS discloses seller’s knowledge while inspections independently assess condition

The TDS supersedes all inspection findings

Only one is required, not both

#182. A seller provides a TDS that does not address whether the property has ever had termite damage. The buyer’s agent notices wood damage near the foundation. The agent should:

Assume the damage is cosmetic and not mention it

Disclose the observation and recommend a pest control inspection before the contingency period expires

Wait for the seller to update the TDS

Only disclose after the buyer commits to the purchase

#183. Under California law, the disclosure of a property’s energy performance (Title 24 compliance) is required when:

Energy-related improvements requiring permits have been made to the property

The property is being sold for the first time

The property is more than 20 years old

The buyer requests a HERS rating

#184. Under California law, a seller who fails to disclose a known material defect may be subject to all of the following EXCEPT:

Automatic criminal arrest without investigation

Rescission of the sale by the buyer

Civil lawsuit for damages

DRE disciplinary action against the agent

#185. A property listed for sale has a history of significant drainage problems causing water to pool in the yard. This information:

Is not material because drainage issues are cosmetic

Only requires disclosure if the water enters the home

Must be disclosed as a material fact that affects the property’s usability and potential structural integrity

Is disclosed only through the NHD report

#186. Under California law, which of the following statements about the seller’s disclosure timeline is CORRECT?

Disclosures can be provided at any time before the end of the first year of ownership

The seller should provide disclosures as soon as practicable and before the buyer is contractually bound

Disclosures are only required within 30 days of the offer

The seller has no time obligation for delivering disclosures

#187. A property has a history of sewer line backups. Under California disclosure law, the seller must:

Only disclose if backups occurred more than 3 times

Not disclose if the sewer line has been repaired

Disclose all known sewer problems on the TDS as they constitute material defects affecting the property’s habitability

Only disclose to the buyer’s plumber

#188. Under California law, the seller must disclose the existence of deed restrictions. Which statement is CORRECT?

Known deed restrictions that affect property use must be disclosed as material facts to prospective buyers

Deed restrictions are only disclosed through the title report

Sellers have no obligation to disclose deed restrictions

Only the HOA discloses deed restrictions

#189. A buyer’s agent discovers an active sinkhole advisory for the area near the listed property. The agent must:

Wait for official evacuation orders before disclosing

Only disclose if the sinkhole is visible on the property

Defer to the NHD company for disclosure

Disclose this advisory to the buyer immediately as a material safety and environmental concern

#190. Under California law, which of the following is required when selling a property that contains a private domestic well?

Private wells do not require any disclosure

The seller must disclose the well and may be required to provide water quality testing information

Only commercial properties with wells need disclosure

The county health department automatically provides well disclosures

#191. A listing agent discovers evidence of an illegal marijuana grow operation residue (chemical contamination) during the visual inspection. The agent should:

Disclose the discovery as a material health and safety concern and recommend professional environmental testing

Ignore it because marijuana is legal in California

Only disclose if the contamination is confirmed by lab testing

Advise the seller to clean up before the next showing without documenting

#192. Under California law, which of the following is TRUE about the seller’s obligation to disclose prior insurance claims for the property?

The seller must provide a CLUE report

Insurance claims are always confidential and cannot be disclosed

Only claims over $25,000 require disclosure

While not specifically required by statute, prior claims related to property condition should be disclosed if they relate to known defects

#193. A property has a retaining wall that shows signs of tilting and cracking. The seller’s TDS does not mention the wall. The listing agent should:

Ignore it because retaining walls are not part of the structure

Only report it if the wall is taller than 6 feet

Assume the seller is aware and chose not to disclose

Disclose the retaining wall condition on the AVID and bring the omission to the seller’s attention for TDS amendment

#194. Under California law, the buyer’s right to rescind after receiving a late TDS is designed to:

Punish the seller for late disclosure

Benefit the listing agent by creating additional negotiation time

Allow the buyer to renegotiate the purchase price

Protect the buyer from being contractually bound before having the opportunity to review material property disclosures

#195. A property has an existing lease with a tenant who has 18 months remaining. The seller’s disclosure must include:

The existence of the lease, its terms, remaining duration, and any tenant rights that will transfer with the property

Only the monthly rent amount

Only the tenant’s name

No tenant information because leases are private

#196. Under California Civil Code §1102, which of the following items must be disclosed on the TDS regarding the property’s appliances?

Whether built-in appliances such as dishwasher, range, and oven are operational

The brand and model of all appliances

The purchase date of every appliance

The energy efficiency rating of each appliance

#197. A seller discloses a prior foundation crack repair on the TDS. A prospective buyer asks the listing agent if the crack will recur. The agent should:

Guarantee the crack will not recur since it was repaired

Say the crack will definitely recur to discourage the buyer

Recommend the buyer consult with a structural engineer for a professional opinion rather than speculating

Refuse to discuss the topic

#198. Under California law, an agent who withholds a material disclosure to facilitate a quicker sale may face:

A reduction in commission only

A verbal warning from the broker

No consequences if the buyer does not discover the withheld information

Disciplinary action, civil liability for damages, and potential fraud charges

#199. A property inspection report identifies potential lead contamination in the soil. For a pre-1978 property, which disclosure applies?

Only the standard lead paint disclosure covers this

Both the federal Lead-Based Paint Disclosure and general material fact disclosure obligations apply to the soil contamination

Soil contamination is not covered by any disclosure requirement

The EPA handles soil contamination disclosure directly

#200. Under California law, when a property has multiple known defects, the seller’s disclosure strategy should be:

Comprehensive and honest, disclosing all known defects on the TDS regardless of their perceived significance

Focus only on major defects and omit minor ones

Disclose only defects that cost more than $5,000 to repair

Let the buyer’s inspector discover the defects