PearsonVue Practice Test
When a buyer purchases a property subject to a seller's existing mortgage, which of the
following statements is CORRECT? - correct answer The seller's obligations under
the existing mortgage remain unchanged.
Which of the following documents is usually prepared when a real estate buyer also
purchases a seller's riding lawn mower? - correct answer Bill of Sale
Which of the following phrases is considered discriminatory advertising by HUD? -
correct answer Exclusive neighborhood
The act of recovering title to property lost through foreclosure on a mortgage is called: -
correct answer redemption
An illegal lending practice whereby a bank refuses to make mortgage loans in a certain
neighborhood based on the ethnic makeup of that area is known as: - correct answer
Redlining
A broker lists a property. The broker advertises and shows the property several times,
but after each showing, the owners call the broker with a list of unreasonable
restrictions they want placed on the showing of the property. The broker decides not to
continue the listing. In this situation, the broker: - correct answer may rescind the
listing contract upon obtaining permission from the owner
To be certain that a property has no encroachments, an appraiser should check a: -
correct answer survey
Which of the following statements about the income approach to value is CORRECT? -
correct answer It estimates an investment property's value based on its return
A landlord enters into a lease with a tenant. The lease contains a provision stating that,
if the landlord decides to sell the property during the term of the lease, the tenant will
have the first right of refusal to purchase the property. Prior to the tenant's lease
expiration, the landlord would like to sell the property. The landlord: - correct answer
must offer the tenant the first opportunity to purchase
A licensee deposited a client's earnest money into the licensee's personal account to
hold. This is considered illegal and known as: - correct answer commingling
A licensee preparing a Competitive Market Analysis (CMA) has information on a
comparable property that is similar in all respects to the subject property except that,
while the subject property is ten years old and has two baths, the comparable property
is five years old and has one bath. In this case, the licensee SHOULD adjust the: -
, correct answer sale price of the comparable property, down for the age and up for the
number of baths
The direct sales comparison (market data) approach would be MOST appropriate for
establishing the value of a: - correct answer 5-year-old single-family residence
A plaintiff files a lawsuit against a licensee for a property that was later determined to
have termite damage. The licensee was unaware of any damage at the time of the
property sale. The type of insurance that protects the licensee in this situation is: -
correct answer errors and omissions
A valid real estate sales contract MUST: - correct answer be signed by the seller
The difference between the value of a property and the total amount of liens against it is
known as: - correct answer equity
Buyers make an earnest money deposit on a property and sign a contract that is
contingent on specific financing terms. Though a bank commits to the financing, the
buyers end up changing their minds. The buyers proceed to notify the seller, in writing,
that they do not intend to buy the property. Which of the following statements is
CORRECT? - correct answer The seller may sue the buyers for breach of contract.
Items permanently attached to real property are considered: - correct answer fixtures
The CERCLA is administered by the: - correct answer Environmental Protection
Agency (EPA)
A licensee describes a house as "fabulous and wonderful" and "having the best view in
town." This is most likely an example of - correct answer puffing
Which of the following clauses will put the priority of an existing mortgage or deed of
trust below that of a mortgage recorded later? - correct answer A subordination clause
If two lots, each 75 feet wide by 105 feet long, cost $30,000 in total, what is their
approximate cost per square foot? - correct answer $2
The owners of a house sign a listing agreement and later tell the licensee that the
garage roof leaks. If the owners tell the licensee not to reveal the roof's condition to any
prospective buyers, the licensee MUST: - correct answer disclose the condition of the
roof to prospective buyers
If a prospective buyer is concerned about the electric service on a property, the buyer's
licensee SHOULD: - correct answer recommend that the buyer insert an inspection
contingency in the purchase agreement
When a buyer purchases a property subject to a seller's existing mortgage, which of the
following statements is CORRECT? - correct answer The seller's obligations under
the existing mortgage remain unchanged.
Which of the following documents is usually prepared when a real estate buyer also
purchases a seller's riding lawn mower? - correct answer Bill of Sale
Which of the following phrases is considered discriminatory advertising by HUD? -
correct answer Exclusive neighborhood
The act of recovering title to property lost through foreclosure on a mortgage is called: -
correct answer redemption
An illegal lending practice whereby a bank refuses to make mortgage loans in a certain
neighborhood based on the ethnic makeup of that area is known as: - correct answer
Redlining
A broker lists a property. The broker advertises and shows the property several times,
but after each showing, the owners call the broker with a list of unreasonable
restrictions they want placed on the showing of the property. The broker decides not to
continue the listing. In this situation, the broker: - correct answer may rescind the
listing contract upon obtaining permission from the owner
To be certain that a property has no encroachments, an appraiser should check a: -
correct answer survey
Which of the following statements about the income approach to value is CORRECT? -
correct answer It estimates an investment property's value based on its return
A landlord enters into a lease with a tenant. The lease contains a provision stating that,
if the landlord decides to sell the property during the term of the lease, the tenant will
have the first right of refusal to purchase the property. Prior to the tenant's lease
expiration, the landlord would like to sell the property. The landlord: - correct answer
must offer the tenant the first opportunity to purchase
A licensee deposited a client's earnest money into the licensee's personal account to
hold. This is considered illegal and known as: - correct answer commingling
A licensee preparing a Competitive Market Analysis (CMA) has information on a
comparable property that is similar in all respects to the subject property except that,
while the subject property is ten years old and has two baths, the comparable property
is five years old and has one bath. In this case, the licensee SHOULD adjust the: -
, correct answer sale price of the comparable property, down for the age and up for the
number of baths
The direct sales comparison (market data) approach would be MOST appropriate for
establishing the value of a: - correct answer 5-year-old single-family residence
A plaintiff files a lawsuit against a licensee for a property that was later determined to
have termite damage. The licensee was unaware of any damage at the time of the
property sale. The type of insurance that protects the licensee in this situation is: -
correct answer errors and omissions
A valid real estate sales contract MUST: - correct answer be signed by the seller
The difference between the value of a property and the total amount of liens against it is
known as: - correct answer equity
Buyers make an earnest money deposit on a property and sign a contract that is
contingent on specific financing terms. Though a bank commits to the financing, the
buyers end up changing their minds. The buyers proceed to notify the seller, in writing,
that they do not intend to buy the property. Which of the following statements is
CORRECT? - correct answer The seller may sue the buyers for breach of contract.
Items permanently attached to real property are considered: - correct answer fixtures
The CERCLA is administered by the: - correct answer Environmental Protection
Agency (EPA)
A licensee describes a house as "fabulous and wonderful" and "having the best view in
town." This is most likely an example of - correct answer puffing
Which of the following clauses will put the priority of an existing mortgage or deed of
trust below that of a mortgage recorded later? - correct answer A subordination clause
If two lots, each 75 feet wide by 105 feet long, cost $30,000 in total, what is their
approximate cost per square foot? - correct answer $2
The owners of a house sign a listing agreement and later tell the licensee that the
garage roof leaks. If the owners tell the licensee not to reveal the roof's condition to any
prospective buyers, the licensee MUST: - correct answer disclose the condition of the
roof to prospective buyers
If a prospective buyer is concerned about the electric service on a property, the buyer's
licensee SHOULD: - correct answer recommend that the buyer insert an inspection
contingency in the purchase agreement
