NATIONAL REAL ESTATE EXAM PRACTICE EXAM QUESTIONS WITH WELL DETAILED
SOLUTIONS – GRADED A+
An office building has a potential gross rent of $20,000.per month. It has a vacancy rate of
15%. Yearly expenses for the property toatl $115,000. If the owner is earning a 10% rate of
return, what is the value of the building?
$890,000
What monthly income will your buyers need to qualify for a $200,000 loan at 6% for 30
years if lenders are qualifying at 28%? (The loan factors is $6.00). Monthly taxes and
insurance will be $900.
$7,500
A seller is closing on the sale of his home on April 23rd. The property taxes have not been
paid for this year. The annual tax bill is $2,008. Using a 360-day year, how much will the
seller owe for taxes at closing?
$630
An owner sold his house for $250,000 with a $50,000 take back. (A take back is seller
financing. The seller receives a note for this amount at closing and will collect this amount
over the agreed-upon term of the loan). He paid off his loan of $138,500 and ha paid a 5%
commission. He had closing costs of $10,000.
How much did the seller net at closing?
$39,000
,John is purchasing a lot 125 feet wide and 127 feet deep for $5.65 a square foot plus $15 a
front foot. (A front foot refers to frontage and is the width of the lot.) How much will he pay
for the lot?
$91,568.75
A sale is closing on June 15th and the annual property tax bill has not been paid. The house
is assessed at $350,000 and the tax rate is $2.50 per $100. Using a 360-day year, how much
will the seller owe for the taxes at closing (to the nearest dollar) and how will this be shown
on the CD?
$4010 debit the seller/ credit the buyer
The fact that an individual must go to the land described which of the physical
characteristics of land?
Immobility
John and Mary are co-owners of a property. John has 60% interest in the property and Mary
has a 40% interest. What type of freehold estate do they have?
Tenancy in common
A property is surveyed to determine a legal description. The surveyor works from a point of
beginning, and measures terminal points and angles. What method of land description is
he using?
Metes and bounds
,Mary and John are married with grown children. Both are intestate. If John dies and Mary
becomes the owner of their home, what type of ownership did they have?
Tenancy by the entirety
The local government needs your land to build a new high school. They have the right to
take your land for the public good. This is called
The right of eminent domain
You have recently purchased property in an area regulated by zoning. It has come to your
attention that you have a zoning violation on the property. What should you do?
Request a variance from the zoning board
One of the property owners in a subdivision is violating the deed restrictions. What can the
other property owners do to get him to comply?
Seek an injunction from the courts
Your property borders a non-navigable waterway and you have riparian rights. You have
built a 10 foot pier at the water's edge. How do measure your property?
To the middle of the waterway
Mary, a single woman, has no children. She owns real property and dies intestate. What
happens to her real property?
, The court will appoint an administrator and it will be distributed to her heirs by the Law of
Descent
A property owner has a gas station on his land. The zoning committee changes the zoning
to R-1. What must the property owner do?
Nothing- his property is automatically considered a non-conforming use
A property owner receives a notice that his land is in an improvement district. What does
this mean?
He will receive an additional tax bill
A property owner has installed a chain link fence on his property. He has received on
official notice requiring the removal of this type of fence. This fence is most likely a violation
of...
Deed restrictions or deed covenants
A single property is regulated by building codes, zoning and deed restrictions. The rules are
in conflict with one another. Which must the property owner obey?
The property owner must obey whichever rules are the strictest or most limiting
Which of the following conveys title to real property and insure good title?
A general warranty deed
SOLUTIONS – GRADED A+
An office building has a potential gross rent of $20,000.per month. It has a vacancy rate of
15%. Yearly expenses for the property toatl $115,000. If the owner is earning a 10% rate of
return, what is the value of the building?
$890,000
What monthly income will your buyers need to qualify for a $200,000 loan at 6% for 30
years if lenders are qualifying at 28%? (The loan factors is $6.00). Monthly taxes and
insurance will be $900.
$7,500
A seller is closing on the sale of his home on April 23rd. The property taxes have not been
paid for this year. The annual tax bill is $2,008. Using a 360-day year, how much will the
seller owe for taxes at closing?
$630
An owner sold his house for $250,000 with a $50,000 take back. (A take back is seller
financing. The seller receives a note for this amount at closing and will collect this amount
over the agreed-upon term of the loan). He paid off his loan of $138,500 and ha paid a 5%
commission. He had closing costs of $10,000.
How much did the seller net at closing?
$39,000
,John is purchasing a lot 125 feet wide and 127 feet deep for $5.65 a square foot plus $15 a
front foot. (A front foot refers to frontage and is the width of the lot.) How much will he pay
for the lot?
$91,568.75
A sale is closing on June 15th and the annual property tax bill has not been paid. The house
is assessed at $350,000 and the tax rate is $2.50 per $100. Using a 360-day year, how much
will the seller owe for the taxes at closing (to the nearest dollar) and how will this be shown
on the CD?
$4010 debit the seller/ credit the buyer
The fact that an individual must go to the land described which of the physical
characteristics of land?
Immobility
John and Mary are co-owners of a property. John has 60% interest in the property and Mary
has a 40% interest. What type of freehold estate do they have?
Tenancy in common
A property is surveyed to determine a legal description. The surveyor works from a point of
beginning, and measures terminal points and angles. What method of land description is
he using?
Metes and bounds
,Mary and John are married with grown children. Both are intestate. If John dies and Mary
becomes the owner of their home, what type of ownership did they have?
Tenancy by the entirety
The local government needs your land to build a new high school. They have the right to
take your land for the public good. This is called
The right of eminent domain
You have recently purchased property in an area regulated by zoning. It has come to your
attention that you have a zoning violation on the property. What should you do?
Request a variance from the zoning board
One of the property owners in a subdivision is violating the deed restrictions. What can the
other property owners do to get him to comply?
Seek an injunction from the courts
Your property borders a non-navigable waterway and you have riparian rights. You have
built a 10 foot pier at the water's edge. How do measure your property?
To the middle of the waterway
Mary, a single woman, has no children. She owns real property and dies intestate. What
happens to her real property?
, The court will appoint an administrator and it will be distributed to her heirs by the Law of
Descent
A property owner has a gas station on his land. The zoning committee changes the zoning
to R-1. What must the property owner do?
Nothing- his property is automatically considered a non-conforming use
A property owner receives a notice that his land is in an improvement district. What does
this mean?
He will receive an additional tax bill
A property owner has installed a chain link fence on his property. He has received on
official notice requiring the removal of this type of fence. This fence is most likely a violation
of...
Deed restrictions or deed covenants
A single property is regulated by building codes, zoning and deed restrictions. The rules are
in conflict with one another. Which must the property owner obey?
The property owner must obey whichever rules are the strictest or most limiting
Which of the following conveys title to real property and insure good title?
A general warranty deed
