COLORADO REAL ESTATE PRACTICE TEST FOR PSI QUESTIONS AND 100% CORRECT ANSWERS|LATEST 2025/2026|GUARANTEED A+

COLORADO REAL ESTATE PRACTICE TEST FOR
PSI QUESTIONS AND 100% CORRECT
ANSWERS|LATEST 2025/2026|GUARANTEED A+

The brokerage firm owns the listing contract and has designated a broker to represent the sell
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er. In this case, the designated broker:
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A. performs the services and represents the seller.
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B. is an employing broker, both represent the seller.
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C. is not supervised by the employing broker.
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D. will be an agent of the buyer. - ANSWER-
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performs the services and represents the seller.
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Only a designated broker has an agency relationship with the seller-
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Bthe designated agency relationship does not extend to the employing broker unless the empl
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oying broker is also designated. Designated agents can only represent a client as a single agent
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Bor transaction agent. The employing broker is still obligated to supervise the designated broke
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r, but the designated broker isn't allowed to share any knowledge with an employing broker w
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ho isn't also designated to that client.
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If a broker wishes to be the only broker involved in a transaction, thereby "double ending" this
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Bsale, she may B B




A. represent both parties as a transaction broker.
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B. treat both parties as customers.
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C. represent one party as an agent and the other as a transaction broker.
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,D. act as an agent to each party. - ANSWER-
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represent both parties as a transaction broker. Dual Agency in Colorado is not allowed.
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Dual agency occurs when real estate agents from the same firm claim to represent both the b
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uyer and the seller in the same transaction.
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An inactive broker has been asked by a friend to list her house in six months. In this case, the b
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roker



A. must pay her errors and omissions insurance, which will activate the license.
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B. may activate her license prior to listing the home.
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C. should list the house as a FSBO so the broker won't have to activate her license.
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D. must refer the potential seller (friend) to an active licensee and receive a referral fee. -
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ANSWER-
B



B. may activate her license prior to listing the home. The answer is may activate her lice
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nse prior to listing the home. In order to take the listing, the broker must activate her license b
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y meeting all requirements, including obtaining E&O insurance. Inactive brokers may not recei
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ve a referral fee. Listing the home as a FSBO and acting as a broker is illegal.
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A buyer is assuming a loan at a closing on October 25. The loan balance after the October 1 pa
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yment is $125,000 and the interest rate is 10%. How will the interest proration appear on the
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buyer's closing statement? B B




A. $235.22 credit
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B. $806.45 credit
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C. $236.82 debit
B B B




D. $1041.67 debit - ANSWER-
B B B B B. $806.45 credit
B B




The answer is $806.45 credit. To solve this problem, take the total amount times the
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,interest rate, then divide by 12 to find monthly interest:
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$125,000 x .1 = $12,500 ÷ 12 = $1,041.67 monthly interest
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Now, divide that answer by the number of days in October and multiply that by the number
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of days the buyer must pay for:
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$1,041.67 ÷ 31 X 24 = $806.45 prorated amount
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Interest on assumed loans is always a buyer credit and seller debit because interest is
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paid in arrears, and the buyer did not own the property at that time.
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All of the following are true of the six-column worksheet EXCEPT
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A. it is a tool for tracking who pays what.
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B. it replaces the buyer and seller closing statements.
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C. it is not given to parties.
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D. the information on it is transferred to the buyer and seller closing statements. - ANSWER-
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B. it replaces the buyer and seller closing statements. The six-
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column worksheet does not replace the buyer and seller closing statements.
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All of the following are true of the brokerage firm's office policy requirements EXCEPT
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A. it must include the license numbers and name of each broker associate.
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B. if the Commission audits the firm, the employing broker must be able to produce the policy.
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B




C. the only required element is a statement on designated brokerage.
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, D. each broker associate must read and sign a copy of the policy. - ANSWER-
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A. it must include the license numbers and name of each broker associate. The answer i
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s it must include the license numbers and name of each broker associate. A list of the brokerag
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e firm's associate brokers would not be included in the office policy.
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A transaction broker is most likely a(n)
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A. coach B B




B. agent B B




C. facilitator
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D. advocate - ANSWER-
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C. facilitator A transaction broker facilitates or coordinates the transaction, in a neutral
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way, to completion. An agent has fiduciary obligations, as illustrated by a coach or advocate.
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8. Colorado law requires buyers to be notified of the source of water for residential properties,
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how does the buyer receive this notice?
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A. The buyer's listing contract
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B. The water department sends a notice after closing
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C. Contract to Buy and Sell or listing contract
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D. Seller's Property Disclosure or Water Addendum - ANSWER-
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D. Seller's Property Disclosure or Water Addendum
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