National Real Estate Exam (PSI) practice questions
205 free questions with answers and explanations.
- 51.A buyer's agent recommends a home inspector who is a personal friend without verifying the inspector's credentials or reputation, resulting in a poor inspection that misses major defects. Which duty has the agent most likely violated?General Principles of Agency
- 52.A property owner makes a written offer to sell a rental building to a buyer. Before the buyer accepts, the owner dies unexpectedly. What is the legal status of the offer?Contracts
- 53.A national franchise brokerage requires all of its affiliated offices to only use one specific title company for closings as a condition of using the franchise name. This arrangement may violate antitrust law because it constitutes:Practice of Real Estate
- 54.An investor purchases a rental property for $180,000. The property generates an annual net operating income of $16,200. What is the investor's rate of return (cap rate)?Real Estate Calculations
- 55.An annual HOA fee of $1,200 is unpaid for the year. Closing occurs on June 1, and the buyer will be responsible for paying the entire year's fee later. Using a 30-day month and 360-day year, how much credit does the buyer receive at closing for the seller's share of the unpaid fee?Real Estate Calculations
- 56.A borrower obtains an FHA-insured loan with a down payment of less than 10%. Which statement best describes the mortgage insurance premium (MIP) requirement?Financing
- 57.A seller wants to net $190,000 after paying a 5% commission. What must the home sell for so the seller nets exactly that amount?Real Estate Calculations
- 58.A parcel of land borders a non-navigable stream. The owner wants to know the extent of their water-related property rights under common riparian doctrine.Property Ownership
- 59.A tenant operates a retail store under a percentage lease requiring a base rent of $2,000 per month plus 5% of annual gross sales exceeding $100,000. If the store's gross sales for the year total $180,000, what is the tenant's total annual rent?Contracts
- 60.A brokerage runs a newspaper ad listing an attractive property for sale but does not include the brokerage's name or license information, only a phone number to call. This type of advertisement is known as a violation called:Practice of Real Estate
- 61.A buyer's agent discovers, through public records, that a nearby vacant lot was formerly the site of a dry-cleaning business that used chlorinated solvents, and groundwater contamination was documented in a state environmental database. What is the agent's best course of action?Property Disclosures
- 62.A homeowners association's recorded covenants limit fence height to four feet in a subdivision. A new buyer purchases a lot and later wants to install a six-foot privacy fence. Which statement best describes the buyer's obligation?Property Ownership
- 63.A purchase agreement contains a clause stating "time is of the essence," specifying a closing date of June 1. The buyer fails to close by June 1 without a valid excuse. What is the legal effect?Contracts
- 64.Three friends, Ann, Ben, and Cara, own a property as joint tenants with right of survivorship. Ben sells his interest to Diego. What is the resulting ownership structure?Property Ownership
- 65.A listing agent tells a prospective buyer, 'This is the best-built home in the neighborhood, and it will definitely appreciate faster than anything else on the market.' The buyer later feels misled after the home does not appreciate as quickly as similar homes. Which best describes the agent's statement?General Principles of Agency
- 66.A tenant who operates a bakery installs a large commercial oven that is bolted to the floor for stability. When the lease ends, the tenant wants to remove the oven. Which best describes the legal status of the oven?Property Ownership
- 67.A bank has taken title to a single-family home through foreclosure and now lists it as an REO (real estate owned) property. The bank's listing agent knows the home has a chronic roof leak that caused hidden attic damage. Under typical seller disclosure statutes, what is the most accurate statement about this situation?Property Disclosures
- 68.A broker's assistant, who is unlicensed and has no actual authority to negotiate contracts, has repeatedly been allowed by the broker to discuss contract terms directly with buyers in the broker's presence without correction. A buyer relies on the assistant's representations about acceptable contract terms during negotiations. If a dispute later arises, what is the most likely basis for holding the broker responsible for the assistant's statements?General Principles of Agency
- 69.A borrower is comparing a mortgage instrument to a deed of trust for financing a home purchase. Which feature distinguishes a deed of trust from a traditional two-party mortgage?Transfer of Title
- 70.A lender requires flood insurance as a condition of financing for a home located within a FEMA-designated Special Flood Hazard Area (SFHA). What is the primary reason for this requirement?Property Disclosures
- 71.A property owner fails to pay both their annual property taxes and their mortgage payment, and both liens go unpaid for an extended period. If the property is foreclosed and sold, which lien is generally paid first from the sale proceeds?Property Ownership
- 72.A buyer works closely with a salesperson for several weeks, touring properties, receiving pricing advice, and discussing offer strategy, but never signs a buyer representation agreement. Based on this ongoing conduct, what type of agency may exist?General Principles of Agency
- 73.A seller conveys property using a special warranty deed. Under this deed, the seller is guaranteeing that:Transfer of Title
- 74.A purchase agreement includes a liquidated damages clause stating that if the buyer defaults, the seller's sole remedy is to retain the buyer's $10,000 earnest money deposit. The buyer later defaults on a $300,000 purchase. What can the seller legally do?Contracts
- 75.Which of the following is a duty owed by the principal TO the agent, rather than a fiduciary duty the agent owes to the principal?General Principles of Agency
- 76.A property owner meets with a broker and, after discussing terms, both sign a written listing agreement authorizing the broker to market and sell the home. What type of agency relationship has been created?General Principles of Agency
- 77.A tenant with a mobility impairment asks her landlord for permission to install a wheelchair ramp at her own expense. The landlord refuses, saying the ramp would change the building's appearance. Under the Fair Housing Act, this refusal is most likely a violation because:Practice of Real Estate
- 78.A seller prepaid a $1,260 annual insurance premium for the calendar year. Closing occurs on September 20, and the buyer will assume the policy. Using a 360-day year (30-day months), how much must the buyer reimburse the seller for the unused portion of the policy?Real Estate Calculations
- 79.A home inspector performs two short-term radon tests in a basement, recording 5.2 pCi/L and 3.6 pCi/L. Based on EPA guidance, what should the inspector recommend to the seller?Property Disclosures
- 80.A seller has an existing mortgage with a $150,000 balance at 5% interest. To finance the sale, the seller creates a wraparound mortgage for $200,000 at 7% interest, continuing to make payments on the original loan while collecting the buyer's payments on the full $200,000 balance. What is the primary financial benefit to the seller in this arrangement?Financing
- 81.A mortgage lender consistently denies loan applications and avoids marketing services in neighborhoods with predominantly minority populations, regardless of applicants' creditworthiness. This practice is best described as:Practice of Real Estate
- 82.A commercial lease is silent regarding assignment. The tenant wants to assign the remaining lease term to a third party without asking the landlord. Is this assignment valid?Contracts
- 83.In a 'closing in escrow' arrangement (common in escrow states), what is the primary role of the neutral escrow agent?Transfer of Title
- 84.A retail store has operated in a neighborhood for 40 years. The city later rezoned the area exclusively for residential use, but the store was allowed to continue operating because it existed before the zoning change. What is this called?Land Use Controls and Regulations
- 85.A homebuyer's monthly mortgage payment includes principal and interest calculated so that the loan balance reaches zero by the end of the loan term. What type of loan is this?Financing
- 86.A general warranty deed offers the grantee the broadest protection because the grantor warrants against title defects that arose:Transfer of Title
- 87.A large brokerage tells smaller independent brokers that it will refuse to cooperate on any transactions with a particular discount brokerage unless the other brokers also refuse. This coordinated refusal to deal is an example of:Practice of Real Estate
- 88.A homeowner discovers that their neighbor's new fence extends two feet onto their property line. What is this situation best classified as?Property Ownership
- 89.A 16-year-old signs a contract to purchase a vacant lot from an adult seller. Under general contract law principles, this contract is best described as:Contracts
- 90.A brokerage advertises a home at an unusually low price to generate calls, but tells every interested buyer the home 'just sold' and instead tries to interest them in higher-priced listings. This practice is known as:Practice of Real Estate
- 91.A broker takes a listing under which the seller promises to pay a commission only if the broker actually produces a ready, willing, and able buyer, while the broker makes no binding promise to procure one. What best characterizes this type of agreement?Contracts
- 92.A seller receives an offer from a buyer at $250,000. The seller signs the offer but changes the closing date and sends it back to the buyer. What is the legal effect of this action?Contracts
- 93.A property owner grants a buyer an option to purchase a parcel of land within 90 days at a fixed price. What right does this give the buyer (optionee)?Contracts
- 94.A buyer agrees to purchase a home by making monthly payments directly to the seller over 15 years, with the seller retaining legal title until the final payment is made. What type of arrangement is this?Contracts
- 95.A utility company holds the right to run power lines across a rural parcel of land, but the utility company owns no adjacent land itself. What type of easement is this?Property Ownership
- 96.Under the Truth in Lending Act, a borrower refinancing the mortgage on their primary residence with a new lender generally has how many business days to rescind the transaction?Financing
- 97.A mortgage company originates a home loan and, shortly after closing, sells the loan to an investor who pools it with other loans into mortgage-backed securities. This activity takes place in which market?Financing
- 98.A married couple owns their home as tenants by the entirety. One spouse incurs a large personal debt unrelated to the property. Can the creditor place a lien on the home to satisfy that individual debt?Property Ownership
- 99.Several brokers in a city are found guilty of colluding to fix commission rates. Under the Sherman Antitrust Act, which of the following consequences could the brokers face?Practice of Real Estate
- 100.During a walkthrough, a buyer notices a large crack running across the living room ceiling. This is an example of what type of defect?Property Disclosures