REAL ESTATE VOCABULARY (GUIDE TO PASSING THE PSI REAL ESTATE EXAM) QUESTIONS AND 100% CORRECT ANSWERS |LATEST 2025/2026|GRADED A+

REAL ESTATE VOCABULARY (GUIDE TO
PASSING THE PSI REAL ESTATE EXAM)
QUESTIONS AND 100% CORRECT ANSWERS
|LATEST 2025/2026|GRADED A+

acceleration clause - B B



ANSWER
B A provision in a written mortgage, note, bond, or conditional sales contract th
B B B B B B B B B B B B



at in the even of default, the whole amount of the principal and the interest may be declared d
B B B B B B B B B B B B B B B B B B



ue and payable at once.
B B B B




accession - B



BANSWER Title to improvements or additions to real property is acquired as a result of t
B B B B B B B B B B B B B B



he accretion of alluvial deposits along the banks of streams or as a result of the annexation of f
B B B B B B B B B B B B B B B B B B



ixtures.



accretion - B



B ANSWER Increase or addition to land by the deposit of sand or soil washed up naturally B B B B B B B B B B B B B B



B from a river, lake, or sea.
B B B B B




accrued depreciation - B B



ANSWER
B The actual depreciation that has occurred to a property at any given date, the
B B B B B B B B B B B B B B



difference between the cost of replacement new (as of the date of the appraisal) and the pres
B B B B B B B B B B B B B B B B



ent appraised value.
B B




acknowledgement - B



ANSWER
B A declaration made by a person to a notary public or other pubic official auth
B B B B B B B B B B B B B B



orized to take acknowledgments that an instrument was executed by his or her as a free and v
B B B B B B B B B B B B B B B B B



oluntary act. B




actual eviction - B B



ANSWER
B The result of legal action originated by a lessor, by which a defaulted tenant is
B B B B B B B B B B B B B B B



physically ousted from the rented property pursuant to a court order.
B B B B B B B B B B




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,actual notice - B B



B ANSWER Express information or fact; that which is known; actual knowledge.
B B B B B B B B B




ad valorem tax -
B B B



B ANSWER A tax levied according to value; generally used to refer to real estate tax.
B B B B B B B B B B B B B




adjustable-rate mortgage (ARM) - B B B



ANSWER
B A mortgage in which the interest changes periodically, according to correspon
B B B B B B B B B B



ding fluctuations in an index. All are tied to indexes.
B B B B B B B B B




adjustment date - ANSWER B B B The date the interest rate changes on an adjustable-
B B B B B B B B



rate mortgage.
B




administrator - B



ANSWER
B The party appointed by the county court to settle the estate of a deceased per
B B B B B B B B B B B B B B



son who died without leaving a will.
B B B B B B




adverse possession - B B



B ANSWER The actual, visible, hostile, notorious, exclusive, and continuous possession of
B B B B B B B B B



B another's land under a claim to title.
B B B B B B




affidavit - B



BANSWER A written statement signed and sworn to before a person authorized to admin
B B B B B B B B B B B B



ister an oath B B




agent - B



ANSWER
B One who represents or has the power to act for another (principal). The auth
B B B B B B B B B B B B B



orization may be express, implied, or apparent. A fiduciary relationship is created when a prin
B B B B B B B B B B B B B B



cipal executes a listing agreement or management contract authorizing a real estate broker to
B B B B B B B B B B B B B B



be his or her agent.
B B B B




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,agreement of sale - B B B



ANSWER
B A written agreement by which the purchaser agrees to buy certain real estate
B B B B B B B B B B B B B



and the seller agrees to sell, on the terms and conditions set forth in the agreement.
B B B B B B B B B B B B B B B




air lot -B B



ANSWER
B A designated airspace over a piece of land, like suface property, may be transf
B B B B B B B B B B B B B



erred.



air rights -
B B



ANSWER
B The right to use the open space above one's property. It can be sold to build a
B B B B B B B B B B B B B B B B B



sky-walk or for the utility company to erect power lines,
B B B B B B B B B




alienation - B



ANSWER
B The act of transferring property to another. May be voluntary, such as by sale,
B B B B B B B B B B B B B B



or involuntary, such as through eminent domain.
B B B B B B




alienation clause - B B



ANSWER
B Clause in a mortgage instrument that does not allow the borrower to sell (wit
B B B B B B B B B B B B B



hout lender approval) on assumption or contract-for-deed.
B B B B B B




alluvion - ANSWER B B The actual soil increase resulting from accretion.
B B B B B B




amendments - B



B ANSWER Changes to previously approved and adopted written agreements.
B B B B B B B




amenities - B



ANSWER
B Neighborhood facilities and services that enhance a property's value, outside B B B B B B B B B B



of the property (swimming pools, three-car garages).
B B B B B B




Americans with Disabilities Act (ADA) -
B B B B B



ANSWER
B A federal law (1992) designed to eliminate discrimination against individuals
B B B B B B B B B B



with disabilities.
B




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, amortization - B



ANSWER
B The liquidation of a financial burden by installment payments, which include B B B B B B B B B B B



principal and interest. The loan payment consists of a portion which will be applied to pay the
B B B B B B B B B B B B B B B B B



accruing interest on a loan, with the remainder being applied to the principal. Over time, the i
B B B B B B B B B B B B B B B B



nterest portion decreases as the loan balance decreases, and the amount applied to principal i
B B B B B B B B B B B B B B



ncreases so that the loan is paid off in the specified time.
B B B B B B B B B B B




amortized loan - B B



ANSWER
B A loan in which the principal and interest are payable in monthly or other peri
B B B B B B B B B B B B B B



odic installments over the term of the loan
B B B B B B B




amortization schedule - B B



ANSWER
B A table which shows how much of each payment will be applied toward princi
B B B B B B B B B B B B B



pal and how much toward interest over the life of the loan. It also shows the gradual decrease
B B B B B B B B B B B B B B B B B B



of the loan balance until it reaches zero.
B B B B B B B




annual percentage rate (APR) -
B B B B



BANSWER This is not the note rate on your loan. It is a value created according to a gover B B B B B B B B B B B B B B B B B



nment formula intended to reflect the true annual cost of borrowing, expressed as a percenta
B B B B B B B B B B B B B B



ge. It works sort of like this, but not exactly, so only use this as a guideline: deduct the closing c
B B B B B B B B B B B B B B B B B B B B



osts from your loan amount, then using your actual loan payment, calculate what the interest
B B B B B B B B B B B B B B B



rate would be on this amount instead of your actual loan amount. Because you are using the s
B B B B B B B B B B B B B B B B B



ame payment on a smaller amount, it is always higher than the actual not rate on your loan.
B B B B B B B B B B B B B B B B B




antitrust laws - B B



BANSWER The laws designed to preserve the free enterprise of the open marketplace by B B B B B B B B B B B B



Bmaking illegal certain private conspiracies and combinations formed to minimize competition
B B B B B B B B B B



. Violations: price fixing (set fixed compensation rates) or allocation of customers or markets (
B B B B B B B B B B B B B B



brokers agreeing to limit their trades to certain areas or properties.
B B B B B B B B B B




application - B



ANSWER
B The form used to apply for a mortgage loan, containing information about a b B B B B B B B B B B B B B



orrower's income, savings, assets, debts, and more.
B B B B B B




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