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California Transfer of Property — Printable Practice Pack
California state portion · the Business and Professions Code, DRE trust-fund rules and California's disclosure regime · 20 questions · Answer key on the last page · agentexamcoach.com
1.A married seller insists their spouse need not sign the deed to community property. What should escrow require?
(A)A separate property affidavit from the buyer
(B)Only the titled spouse's signature and licence
(C)The listing broker's certification of authority
(D)Both spouses' signatures for a valid community property conveyance
2.Which transfer avoids probate entirely?
(A)Property held as a tenant in common
(B)Property of an intestate decedent
(C)Property passing by will
(D)Property held in joint tenancy passing to the survivor
3.Which closing cost is typically prorated between buyer and seller?
(A)The loan origination fee
(B)The buyer's inspection fee
(C)Property taxes
(D)The owner's title policy
4.A grantor conveys land they do not yet own and later acquires title. What happens?
(A)The grantor keeps title until a new deed is signed
(B)The earlier deed is void and must be redone
(C)The county reassigns title by administrative order
(D)Title passes automatically to the earlier grantee
5.An investor sells a rental for $1,000,000 (adjusted basis $600,000) and buys a $1,200,000 replacement through a qualified intermediary within the deadlines. Recognised gain?
(A)$0 — fully deferred, trading up with no boot received
(B)$600,000 — the adjusted basis is recognised as gain
(C)$200,000 — one half of the realised gain is recognised
(D)$400,000 — the entire realised gain is recognised
6.What does a title searcher mean by a cloud on title?
(A)A tax bill that has not yet been issued
(B)An easement the owner granted knowingly
(C)A claim or defect impairing marketability
(D)A mortgage the buyer intends to assume
7.An escrow prorates using a 360-day year. How many days does it treat each month as having?
(A)Twenty-nine days
(B)Twenty-eight days
(C)Thirty days
(D)Thirty-one days
8.Which requirement is essential for a deed to be valid between the parties?
(A)Delivery and acceptance
(B)Recording with the county
(C)A stated purchase price
(D)Notarised acknowledgement
9.A parent transfers a home to a child under current California law. When does the exclusion from reassessment apply?
(A)Where the property is worth under two million
(B)Where the child pays fair market value for it
(C)Where the child occupies it as a principal residence
(D)Where the child holds it for at least one year
10.Which requirement is essential to a claim of adverse possession in California?
(A)Payment of property taxes for the period
(B)Written consent of the owner
(C)Recording a notice of claim
(D)Continuous occupancy for one year
11.Who may NOT lawfully receive any part of an escrow company's fees for referring escrow business?
(A)A title company charging for actual services
(B)The escrow association's education fund
(C)A real estate licensee taking a referral kickback
(D)The escrow company's own salaried employees
12.A closing statement must balance. What does that mean in practice?
(A)Total debits equal total credits for each party
(B)The loan equals the price
(C)Buyer and seller pay equal amounts
(D)The commission equals the deposit
13.A buyer closes on a home and discovers a recorded easement for a pipeline that the title company missed and the policy did not except. What is the buyer's remedy?
(A)A claim under the title insurance policy for the loss caused by the undisclosed recorded easement
(B)A claim against the county for improper indexing
(C)Nothing, because recorded easements are the buyer's responsibility to find
(D)A claim against the seller only, because the title company is not responsible
14.Which statement about property tax reassessment when adding a spouse to title is correct?
(A)Any title change triggers reassessment
(B)Interspousal transfers are excluded from reassessment
(C)Reassessment occurs only for same-sex couples
(D)The tax doubles
15.A recorded easement appears on the preliminary report and the buyer objects. What is the usual course?
(A)Ignore it, since it will expire at closing
(B)Require escrow to remove it from the record
(C)Negotiate, accept it, or cancel under the contract
(D)Have the title company insure it away
16.What does a 'title plant' refer to?
(A)A nursery growing plants on the subject property
(B)The escrow office where the closing is conducted
(C)The county recorder's office where deeds are filed
(D)A title company's private database of records indexed by parcel
17.What is the effect of the doctrine of relation back in escrow?
(A)Recording is retroactive to the offer
(B)The deed is void until recorded
(C)Taxes reset to the prior owner's basis
(D)Closing may relate to an earlier deposit date
18.What is a 'quiet title' action used for?
(A)To have a court determine ownership and remove adverse claims
(B)To partition land among disagreeing co-owners
(C)To reduce noise disturbances from neighbouring owners
(D)To foreclose a lien against the property
19.Annual taxes are $4,800 and escrow closes on 1 October with the seller having paid the full year to 31 December. What does the buyer owe the seller?
(A)$3,600
(B)$1,200
(C)$400
(D)$2,400
20.Which owner may claim a substantially larger property tax exemption in California?
(A)A first-time buyer in their first three years
(B)A qualifying disabled veteran on their residence
(C)An owner of agricultural land of any size
(D)An owner holding title in a living trust
Answer key & explanations
1. D — Both spouses must join in conveying or encumbering community real property; one signature is voidable by the other spouse.
2. D — Survivorship transfers by operation of law outside probate.
3. C — Prorations divide ongoing costs (taxes, HOA dues, rents) by the period each party owns the property.
4. D — Under the after-acquired title doctrine, title later obtained by the grantor inures to the benefit of the earlier grantee.
5. A — Trading equal or up with no boot defers all gain.
6. C — A cloud is an apparent claim or encumbrance that, if valid, would impair title and must be cleared or accepted.
7. C — A banker's or statutory year of 360 days treats every month as thirty days, simplifying proration arithmetic.
8. A — A deed passes title on delivery and acceptance. Recording and acknowledgement matter for constructive notice, not for validity between the parties.
9. C — The parent-child exclusion now requires the child to make the property their principal residence and is capped in value.
10. A — California requires the claimant to pay the property taxes throughout the statutory period, alongside open, notorious, hostile and continuous possession.
11. C — Fee-splitting kickbacks for escrow referrals are prohibited; payment for actual services stands apart.
12. A — Each side's statement balances its own debits against credits, producing the cash required or due.
13. A — Title insurance covers recorded defects not excepted from coverage.
14. B — Transfers between spouses are excluded change-of-ownership events.
15. C — A recorded easement runs with the land, so the buyer must accept it, negotiate, or exercise a contractual right to cancel.
16. D — Title plants let insurers search by property rather than by name.
17. D — Where a grantor dies or becomes incapacitated after depositing the deed, delivery may relate back to the deposit date so the transfer stands.
18. A — Quiet title resolves disputes or clouds and confirms ownership.
19. B — Three months remain in the buyer's ownership. $4,800 divided by twelve is $400 a month, so three months is $1,200 credited to the seller.
20. B — The disabled veterans exemption is far larger than the basic veterans or homeowner exemptions.
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