Texas Real Estate Broker Exam (Verified Answers) Plus
Rationales Q&A | Instant Download Pdf
1. Which of the following is required to obtain a Texas real estate broker
license?
A) Completion of 180 classroom hours of qualifying real estate courses
B) At least 4 years of active experience as a licensed real estate salesperson
C) Passing the Texas Real Estate Broker Exam
D) All of the above
Answer: D) All of the above
Rationale: To qualify for a broker license in Texas, an applicant must complete
the required education, have at least 4 years of active experience as a licensed
salesperson, and pass the broker exam.
2. A real estate broker in Texas may legally receive a commission:
A) Only from their employing broker
B) Directly from a seller or buyer
C) Without a written agreement
D) Only if the transaction involves residential property
Answer: A) Only from their employing broker
Rationale: Texas law requires that licensed salespersons and associate brokers
receive commissions only through their sponsoring broker.
3. Which of the following is considered a fiduciary duty of a real estate
broker to a client?
A) Loyalty
B) Disclosure
C) Confidentiality
D) All of the above
Answer: D) All of the above
Rationale: Brokers owe clients fiduciary duties, including loyalty, disclosure,
confidentiality, obedience, and accounting.
,4. When must a Texas broker provide the Information About Brokerage
Services (IABS) form?
A) At first substantive communication about a specific property
B) After the contract is signed
C) Only if requested by the client
D) During the closing process
Answer: A) At first substantive communication about a specific property
Rationale: Texas law mandates that the IABS form be provided at the first
substantive discussion regarding a specific property.
5. An option contract in real estate:
A) Transfers ownership immediately
B) Gives the buyer the right, but not the obligation, to purchase the property
C) Requires the seller to buy another property
D) Is enforceable without consideration
Answer: B) Gives the buyer the right, but not the obligation, to purchase the
property
Rationale: An option contract grants the buyer the choice to purchase within a
specified time frame, usually in exchange for consideration.
6. Which type of agency relationship allows the broker to represent both the
buyer and the seller?
A) Single agency
B) Subagency
C) Dual agency (intermediary in Texas)
D) Transaction brokerage
Answer: C) Dual agency (intermediary in Texas)
Rationale: In Texas, an intermediary relationship allows a broker to represent
both parties, with written consent from both buyer and seller.
,7. A broker is required to maintain transaction records for how long
according to Texas law?
A) 1 year
B) 2 years
C) 4 years
D) 5 years
Answer: B) 4 years
Rationale: The Texas Real Estate Commission requires brokers to keep
transaction records for a minimum of 4 years from the date of closing.
8. Which of the following would be considered a material fact in a real estate
transaction?
A) Seller’s marital status
B) A leaking roof
C) Buyer’s occupation
D) Seller’s personal preference on color
Answer: B) A leaking roof
Rationale: Material facts are those that could influence a buyer’s decision or
affect the value of the property.
9. Commingling in real estate refers to:
A) Mixing client funds with the broker’s personal funds
B) Working with multiple clients at the same time
C) Co-listing a property with another broker
D) Representing both buyer and seller
Answer: A) Mixing client funds with the broker’s personal funds
Rationale: Commingling is illegal; trust funds must be kept separate from
personal or business funds.
10. What is the primary purpose of the Texas Real Estate Recovery Trust
Account?
, A) To pay for broker advertising
B) To reimburse clients who suffer damages due to licensee misconduct
C) To fund TREC operations
D) To guarantee a licensee’s commission
Answer: B) To reimburse clients who suffer damages due to licensee
misconduct
Rationale: The account protects consumers when a licensed agent causes
monetary loss due to fraud, misrepresentation, or violation of license law.
11. A seller asks a broker to market their property but insists on paying cash
at closing. What should the broker do?
A) Refuse the listing
B) Accept without documentation
C) Require written instructions and follow TREC rules
D) Collect the cash directly
Answer: C) Require written instructions and follow TREC rules
Rationale: Brokers must document transactions properly and cannot handle
funds outside TREC rules.
12. How long must a Texas broker retain the IABS form after it is signed or
provided?
A) 1 year
B) 2 years
C) 4 years
D) 5 years
Answer: C) 4 years
Rationale: The IABS form, like all transaction records, must be kept for at least
4 years.
13. Which of the following actions could result in suspension or revocation of
a Texas real estate license?
Rationales Q&A | Instant Download Pdf
1. Which of the following is required to obtain a Texas real estate broker
license?
A) Completion of 180 classroom hours of qualifying real estate courses
B) At least 4 years of active experience as a licensed real estate salesperson
C) Passing the Texas Real Estate Broker Exam
D) All of the above
Answer: D) All of the above
Rationale: To qualify for a broker license in Texas, an applicant must complete
the required education, have at least 4 years of active experience as a licensed
salesperson, and pass the broker exam.
2. A real estate broker in Texas may legally receive a commission:
A) Only from their employing broker
B) Directly from a seller or buyer
C) Without a written agreement
D) Only if the transaction involves residential property
Answer: A) Only from their employing broker
Rationale: Texas law requires that licensed salespersons and associate brokers
receive commissions only through their sponsoring broker.
3. Which of the following is considered a fiduciary duty of a real estate
broker to a client?
A) Loyalty
B) Disclosure
C) Confidentiality
D) All of the above
Answer: D) All of the above
Rationale: Brokers owe clients fiduciary duties, including loyalty, disclosure,
confidentiality, obedience, and accounting.
,4. When must a Texas broker provide the Information About Brokerage
Services (IABS) form?
A) At first substantive communication about a specific property
B) After the contract is signed
C) Only if requested by the client
D) During the closing process
Answer: A) At first substantive communication about a specific property
Rationale: Texas law mandates that the IABS form be provided at the first
substantive discussion regarding a specific property.
5. An option contract in real estate:
A) Transfers ownership immediately
B) Gives the buyer the right, but not the obligation, to purchase the property
C) Requires the seller to buy another property
D) Is enforceable without consideration
Answer: B) Gives the buyer the right, but not the obligation, to purchase the
property
Rationale: An option contract grants the buyer the choice to purchase within a
specified time frame, usually in exchange for consideration.
6. Which type of agency relationship allows the broker to represent both the
buyer and the seller?
A) Single agency
B) Subagency
C) Dual agency (intermediary in Texas)
D) Transaction brokerage
Answer: C) Dual agency (intermediary in Texas)
Rationale: In Texas, an intermediary relationship allows a broker to represent
both parties, with written consent from both buyer and seller.
,7. A broker is required to maintain transaction records for how long
according to Texas law?
A) 1 year
B) 2 years
C) 4 years
D) 5 years
Answer: B) 4 years
Rationale: The Texas Real Estate Commission requires brokers to keep
transaction records for a minimum of 4 years from the date of closing.
8. Which of the following would be considered a material fact in a real estate
transaction?
A) Seller’s marital status
B) A leaking roof
C) Buyer’s occupation
D) Seller’s personal preference on color
Answer: B) A leaking roof
Rationale: Material facts are those that could influence a buyer’s decision or
affect the value of the property.
9. Commingling in real estate refers to:
A) Mixing client funds with the broker’s personal funds
B) Working with multiple clients at the same time
C) Co-listing a property with another broker
D) Representing both buyer and seller
Answer: A) Mixing client funds with the broker’s personal funds
Rationale: Commingling is illegal; trust funds must be kept separate from
personal or business funds.
10. What is the primary purpose of the Texas Real Estate Recovery Trust
Account?
, A) To pay for broker advertising
B) To reimburse clients who suffer damages due to licensee misconduct
C) To fund TREC operations
D) To guarantee a licensee’s commission
Answer: B) To reimburse clients who suffer damages due to licensee
misconduct
Rationale: The account protects consumers when a licensed agent causes
monetary loss due to fraud, misrepresentation, or violation of license law.
11. A seller asks a broker to market their property but insists on paying cash
at closing. What should the broker do?
A) Refuse the listing
B) Accept without documentation
C) Require written instructions and follow TREC rules
D) Collect the cash directly
Answer: C) Require written instructions and follow TREC rules
Rationale: Brokers must document transactions properly and cannot handle
funds outside TREC rules.
12. How long must a Texas broker retain the IABS form after it is signed or
provided?
A) 1 year
B) 2 years
C) 4 years
D) 5 years
Answer: C) 4 years
Rationale: The IABS form, like all transaction records, must be kept for at least
4 years.
13. Which of the following actions could result in suspension or revocation of
a Texas real estate license?
