California Real Estate Practice Exam

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Which of the following is not a requirement to be a holder in due course of a negotiable instrument?

The instrument must have been taken directly from the maker of the note.
The instrument must be endorsed.
The instrument must be obtained for value.
The instrument must be obtained in good faith.

The correct answer is: The instrument must have been taken directly from the maker of the note.

To be a holder in due course of a negotiable instrument, one must meet certain requirements. These requirements include obtaining the instrument for value, in good faith, and with an endorsement. Option A is incorrect because it does not mention obtaining the instrument for value, which is a crucial requirement. Option B and C are also incorrect because they do not mention obtaining the instrument in good faith. Option D is incorrect because it does not mention the requirement of an endorsement.