Real Estate Updated Maryland-Real-Estate-Salesperson Exam Questions and Answers by aaryan

Net Operating Income (NOI) is the income remaining after deducting operating expenses from the property’s operating income. In appraisal (income approach) and investment analysis, the standard relationships are:

Potential Gross Income (PGI) = income at full occupancy (before vacancies and collection loss).

Effective Gross Income (EGI) = PGI minus vacancy/collection loss plus other income.

In a sub-agency relationship, the cooperating licensee (sub-agent) works with a buyer but represents the seller, not the buyer.

Kip, as a sub-agent, owes fiduciary duties of loyalty, obedience, confidentiality, and disclosure to the seller (May), the same client represented by Sheila, the listing agent.

The buyer, Charlie, is treated as a customer, not a client, meaning no fiduciary obligations exist beyond honesty and fair dealing.

This principle is covered in Maryland’s Law of Agency and Brokerage Operations modules.

Reference (Maryland Source):

– Maryland 60-Hour Principles and Practices Course, Agency Relationships and Sub-Agency sections.

– Business Occupations and Professions Article §17-530 – §17-534.

For pre-1978 residential housing, federal law (Title X) requires the lead-based paint disclosure, EPA pamphlet delivery, and an opportunity for a lead assessment. This is a material, mandatory disclosure. Medical history of prior occupants (e.g., HIV, Ebola) is not disclosed and implicates fair housing and privacy. Number of prior owners is not a material defect by itself.

In the “Transfer of Title” module, a deed is defined as the written instrument used to convey legal title (ownership) to real property from grantor to grantee. Proper execution and delivery of a deed transfer ownership.

A lien is an encumbrance—a charge against property to secure a debt—not a conveyance.

A mortgage (or deed of trust) is a security instrument that creates a lien; it does not, by itself, convey fee ownership to the lender.

Title is the legal concept of ownership and the bundle of rights; it is not the instrument that transfers ownership.

References (Course Outline/Study Topics):

Maryland 60-Hour Principles and Practices of Real Estate Pre-Licensing Course — “Transfer of Title” (Deeds: purpose, elements, execution and delivery; distinction among title, deed, liens, and mortgages).