Colibri School Exam NJ 2023
(Updated): 100 Practice Questions &
Answers
This comprehensive practice guide covers key topics for the New
Jersey real estate exam, including fraud, agency relationships, fair
housing laws, loan financing, leases, and driver requirements.
SECTION 1: REAL ESTATE PRINCIPLES & AGENCY
Question 1
Bert is showing his buyer a home in a historic district. The buyer
mentions in passing that she would like to place solar panels on the
roof. Bert knows that the homeowner's association CC&Rs would
prohibit this to protect the historic character of the neighborhood, but
he doesn't tell the buyer for fear she'll lose interest in the house. Bert
has committed:
A. Constructive fraud
B. Actual fraud
C. Negligent misrepresentation
D. Puffing
Answer: B. Actual fraud
,Rationale: Bert knowingly concealed a material fact that would affect
the buyer's decision (the CC&R prohibition on solar panels), which
constitutes actual fraud. Actual fraud involves intentional deception or
concealment of a material fact.
Question 2
In a real estate transaction, the principal would BEST be described as
the:
A. Buyer or seller
B. Person represented by an agent
C. Real estate licensee
D. Attorney representing the parties
Answer: B. Person represented by an agent
Rationale: In agency relationships, the principal is the party who
employs or authorizes an agent to act on their behalf. The agent
represents the principal's interests in the transaction.
Question 3
Danita gets a deed of trust from ABC bank to finance the purchase of
a house in Sunny Acres, a new subdivision. While the loan is
outstanding, who holds the title to Danita's property?
A. Danita
B. ABC Bank
,C. A trustee
D. The county recorder
Answer: C. A trustee
Rationale: In a deed of trust, a neutral third party (the trustee) holds
legal title to the property on behalf of the lender (beneficiary) until the
loan is paid off. The borrower retains equitable title.
Question 4
Which situation is NOT EXEMPT from the provisions of federal fair
housing laws, assuming no discriminatory advertising is used and a
licensee is not involved?
A. An owner-occupant of a duplex who will lease the other unit only to
a white woman
B. A religious organization renting units to members of the same faith
C. A private club renting to its members
D. A single-family home owner selling without a broker
Answer: A. An owner-occupant of a duplex who will lease the other
unit only to a white woman
Rationale: While the "Mrs. Murphy" exemption allows owner-occupied
buildings with four or fewer units to discriminate, it does not permit
racial discrimination. The other options are exempt under fair housing
laws.
Question 5
, Which of these phrases would LEAST likely be evidence of a
conspiracy to commit an antitrust violation if said by a licensee?
A. "All of the brokers in this area charge a 6% commission."
B. "We would like to suggest that you use Ace Title Agency for the
closing."
C. "Let's agree not to show each other's listings."
D. "We should divide the territory so we don't compete."
Answer: B. "We would like to suggest that you use Ace Title Agency for
the closing."
Rationale: Recommending a title agency is not typically an antitrust
violation. Antitrust violations in real estate include price-fixing, market
allocation, and group boycotts. Suggesting a service provider is a
normal business practice.
Question 6
Which lease tenancy is engaged in by a holdover tenant?
A. Tenancy for years
B. Periodic tenancy
C. Tenancy at sufferance
D. Tenancy at will
Answer: C. Tenancy at sufferance
Rationale: A holdover tenant remains in possession without the
landlord's consent after the lease expires. This creates a tenancy at
sufferance, which is the least favorable tenancy for the tenant.
(Updated): 100 Practice Questions &
Answers
This comprehensive practice guide covers key topics for the New
Jersey real estate exam, including fraud, agency relationships, fair
housing laws, loan financing, leases, and driver requirements.
SECTION 1: REAL ESTATE PRINCIPLES & AGENCY
Question 1
Bert is showing his buyer a home in a historic district. The buyer
mentions in passing that she would like to place solar panels on the
roof. Bert knows that the homeowner's association CC&Rs would
prohibit this to protect the historic character of the neighborhood, but
he doesn't tell the buyer for fear she'll lose interest in the house. Bert
has committed:
A. Constructive fraud
B. Actual fraud
C. Negligent misrepresentation
D. Puffing
Answer: B. Actual fraud
,Rationale: Bert knowingly concealed a material fact that would affect
the buyer's decision (the CC&R prohibition on solar panels), which
constitutes actual fraud. Actual fraud involves intentional deception or
concealment of a material fact.
Question 2
In a real estate transaction, the principal would BEST be described as
the:
A. Buyer or seller
B. Person represented by an agent
C. Real estate licensee
D. Attorney representing the parties
Answer: B. Person represented by an agent
Rationale: In agency relationships, the principal is the party who
employs or authorizes an agent to act on their behalf. The agent
represents the principal's interests in the transaction.
Question 3
Danita gets a deed of trust from ABC bank to finance the purchase of
a house in Sunny Acres, a new subdivision. While the loan is
outstanding, who holds the title to Danita's property?
A. Danita
B. ABC Bank
,C. A trustee
D. The county recorder
Answer: C. A trustee
Rationale: In a deed of trust, a neutral third party (the trustee) holds
legal title to the property on behalf of the lender (beneficiary) until the
loan is paid off. The borrower retains equitable title.
Question 4
Which situation is NOT EXEMPT from the provisions of federal fair
housing laws, assuming no discriminatory advertising is used and a
licensee is not involved?
A. An owner-occupant of a duplex who will lease the other unit only to
a white woman
B. A religious organization renting units to members of the same faith
C. A private club renting to its members
D. A single-family home owner selling without a broker
Answer: A. An owner-occupant of a duplex who will lease the other
unit only to a white woman
Rationale: While the "Mrs. Murphy" exemption allows owner-occupied
buildings with four or fewer units to discriminate, it does not permit
racial discrimination. The other options are exempt under fair housing
laws.
Question 5
, Which of these phrases would LEAST likely be evidence of a
conspiracy to commit an antitrust violation if said by a licensee?
A. "All of the brokers in this area charge a 6% commission."
B. "We would like to suggest that you use Ace Title Agency for the
closing."
C. "Let's agree not to show each other's listings."
D. "We should divide the territory so we don't compete."
Answer: B. "We would like to suggest that you use Ace Title Agency for
the closing."
Rationale: Recommending a title agency is not typically an antitrust
violation. Antitrust violations in real estate include price-fixing, market
allocation, and group boycotts. Suggesting a service provider is a
normal business practice.
Question 6
Which lease tenancy is engaged in by a holdover tenant?
A. Tenancy for years
B. Periodic tenancy
C. Tenancy at sufferance
D. Tenancy at will
Answer: C. Tenancy at sufferance
Rationale: A holdover tenant remains in possession without the
landlord's consent after the lease expires. This creates a tenancy at
sufferance, which is the least favorable tenancy for the tenant.
