Texas Real Estate Practice Exam
Questions and Answers | Latest
Version | 2025/2026 | Correct & Verified
Which type of property ownership allows two or more people to hold unequal shares with no
right of survivorship?
A) Joint tenancy
B) Tenancy in common
C) Fee simple absolute
D) Life estate
✔✔B) Tenancy in common
What is the purpose of the Texas Real Estate Commission (TREC)?
A) Set property taxes
B) License and regulate real estate professionals
C) Appraise properties
D) Sell state-owned properties
✔✔B) License and regulate real estate professionals
Which type of listing allows multiple brokers to sell a property but only pays a commission to
the broker who procures a buyer?
A) Exclusive right-to-sell
B) Open listing
1
,C) Exclusive agency
D) Net listing
✔✔B) Open listing
What is the primary function of a Comparative Market Analysis (CMA)?
A) Calculate mortgage rates
B) Estimate the property’s market value based on similar properties
C) Inspect structural condition
D) Determine zoning compliance
✔✔B) Estimate the property’s market value based on similar properties
Which clause in a mortgage allows the lender to demand full repayment if the borrower defaults?
A) Acceleration clause
B) Alienation clause
C) Prepayment clause
D) Escalation clause
✔✔A) Acceleration clause
What is the main advantage of a general warranty deed?
A) It guarantees full ownership and protects against past title defects
B) It transfers only the seller’s interest
C) It requires no consideration
D) It cannot be recorded
2
,✔✔A) It guarantees full ownership and protects against past title defects
Which federal law requires disclosure of lead-based paint in homes built before 1978?
A) Fair Housing Act
B) Lead-Based Paint Hazard Reduction Act
C) RESPA
D) TILA
✔✔B) Lead-Based Paint Hazard Reduction Act
Which type of agency represents the buyer in a real estate transaction?
A) Seller’s agent
B) Buyer’s agent
C) Dual agent
D) Transaction broker
✔✔B) Buyer’s agent
What is a “fixture” in real estate terms?
A) A movable personal item
B) An item permanently attached to the property
C) A mortgage document
D) A leasehold interest
✔✔B) An item permanently attached to the property
3
, Which type of lease requires the tenant to pay rent plus property expenses such as taxes and
insurance?
A) Gross lease
B) Net lease
C) Percentage lease
D) Graduated lease
✔✔B) Net lease
Which form is required in Texas to inform potential clients about agency relationships?
A) Contract of Sale
B) Information About Brokerage Services (IABS) form
C) Seller’s Disclosure Notice
D) Deed of Trust
✔✔B) Information About Brokerage Services (IABS) form
Which appraisal approach is most commonly used for residential properties?
A) Cost approach
B) Income approach
C) Sales comparison approach
D) Replacement cost approach
✔✔C) Sales comparison approach
Which type of mortgage allows the borrower to pay only interest for a set period?
4
Questions and Answers | Latest
Version | 2025/2026 | Correct & Verified
Which type of property ownership allows two or more people to hold unequal shares with no
right of survivorship?
A) Joint tenancy
B) Tenancy in common
C) Fee simple absolute
D) Life estate
✔✔B) Tenancy in common
What is the purpose of the Texas Real Estate Commission (TREC)?
A) Set property taxes
B) License and regulate real estate professionals
C) Appraise properties
D) Sell state-owned properties
✔✔B) License and regulate real estate professionals
Which type of listing allows multiple brokers to sell a property but only pays a commission to
the broker who procures a buyer?
A) Exclusive right-to-sell
B) Open listing
1
,C) Exclusive agency
D) Net listing
✔✔B) Open listing
What is the primary function of a Comparative Market Analysis (CMA)?
A) Calculate mortgage rates
B) Estimate the property’s market value based on similar properties
C) Inspect structural condition
D) Determine zoning compliance
✔✔B) Estimate the property’s market value based on similar properties
Which clause in a mortgage allows the lender to demand full repayment if the borrower defaults?
A) Acceleration clause
B) Alienation clause
C) Prepayment clause
D) Escalation clause
✔✔A) Acceleration clause
What is the main advantage of a general warranty deed?
A) It guarantees full ownership and protects against past title defects
B) It transfers only the seller’s interest
C) It requires no consideration
D) It cannot be recorded
2
,✔✔A) It guarantees full ownership and protects against past title defects
Which federal law requires disclosure of lead-based paint in homes built before 1978?
A) Fair Housing Act
B) Lead-Based Paint Hazard Reduction Act
C) RESPA
D) TILA
✔✔B) Lead-Based Paint Hazard Reduction Act
Which type of agency represents the buyer in a real estate transaction?
A) Seller’s agent
B) Buyer’s agent
C) Dual agent
D) Transaction broker
✔✔B) Buyer’s agent
What is a “fixture” in real estate terms?
A) A movable personal item
B) An item permanently attached to the property
C) A mortgage document
D) A leasehold interest
✔✔B) An item permanently attached to the property
3
, Which type of lease requires the tenant to pay rent plus property expenses such as taxes and
insurance?
A) Gross lease
B) Net lease
C) Percentage lease
D) Graduated lease
✔✔B) Net lease
Which form is required in Texas to inform potential clients about agency relationships?
A) Contract of Sale
B) Information About Brokerage Services (IABS) form
C) Seller’s Disclosure Notice
D) Deed of Trust
✔✔B) Information About Brokerage Services (IABS) form
Which appraisal approach is most commonly used for residential properties?
A) Cost approach
B) Income approach
C) Sales comparison approach
D) Replacement cost approach
✔✔C) Sales comparison approach
Which type of mortgage allows the borrower to pay only interest for a set period?
4
