PSI Practice Test-Questions with Correct Answers/ Verified/ 100%
Pass
An exception to title insurance coverage is
1. forged documents.
2. defects found in public newspapers.
3. incorrect records of marital status.
4. defects that clearly appear in the title search. - ✔️✔️defects that clearly appear in the title
search.
A lawsuit for inverse condemnation may be brought by
1. the police.
2. the city.
3. a homeowner.
4. the zoning board. - ✔️✔️A Homeowner
A landowner wishes to build a neighborhood grocery store on a busy street in an area zoned for
residential use. Which of the following would MOST likely be used to obtain permission for this
store?
1. Deed amendment.
2. Approval of surrounding property owners.
3. Inclusionary zoning.
,4. Conditional use permit or zoning variance. - ✔️✔️4. Conditional use permit or zoning variance.
A salesperson lists a property with a contract that allows for subagency and dual agency. The
salesperson is
1. an independent contractor to the broker and an agent to the principal.
2. an agent to the broker and a subagent to the principal.
3. a subagent to the broker and an agent to the principal.
4. an agent to the broker and an agent to the principal. - ✔️✔️2. an agent to the broker and a
subagent to the principal.
When a listing broker is preparing an Offer to Purchase for a buyer customer, contingencies
involving inspections or approval by a third party should
1. have short deadlines.
2. be discouraged by the broker.
3. be stated as briefly as possible.
4. be limited to mortgage arrangements. - ✔️✔️1. have short deadlines.
An investment property returns 12% of its value or $21,000 annually. What is the value of the
property?
1. $100,000
2. $175,000
, 3. $235,200
4. $252,000 - ✔️✔️175,000, (21,000/.12)
Earnest money should be deposited into a trust account
1. in a timely manner, according to state laws.
2. upon removal of all contingencies.
3. at the broker's discretion.
4. according to MLS rules. - ✔️✔️in a timely manner, according to state laws.
Even after an offer has been accepted and is binding, the buyer and seller may still choose to sign
mutual release papers rather than proceed to closing. Which of the following circumstances would
NOT give either party a justifiable reason to insist on a mutual release?
1. The buyer finds a better property for better terms.
2. A title defect that will take months to clear is discovered.
3. A basement fire causes damage that requires extensive repairs.
4. The buyer is unable to obtain financing that meets the terms of the contract's financing
contingency. - ✔️✔️1. The buyer finds a better property for better terms.
A prospective buyer made an offer to purchase a property. The owner responded with a
counteroffer. While the buyer was reviewing the counteroffer, the owner received a better offer.
The owner can accept the second offer if
1. it satisfies or exceeds all terms included in the counteroffer.
2. the owner withdraws the counteroffer before it is accepted.
Pass
An exception to title insurance coverage is
1. forged documents.
2. defects found in public newspapers.
3. incorrect records of marital status.
4. defects that clearly appear in the title search. - ✔️✔️defects that clearly appear in the title
search.
A lawsuit for inverse condemnation may be brought by
1. the police.
2. the city.
3. a homeowner.
4. the zoning board. - ✔️✔️A Homeowner
A landowner wishes to build a neighborhood grocery store on a busy street in an area zoned for
residential use. Which of the following would MOST likely be used to obtain permission for this
store?
1. Deed amendment.
2. Approval of surrounding property owners.
3. Inclusionary zoning.
,4. Conditional use permit or zoning variance. - ✔️✔️4. Conditional use permit or zoning variance.
A salesperson lists a property with a contract that allows for subagency and dual agency. The
salesperson is
1. an independent contractor to the broker and an agent to the principal.
2. an agent to the broker and a subagent to the principal.
3. a subagent to the broker and an agent to the principal.
4. an agent to the broker and an agent to the principal. - ✔️✔️2. an agent to the broker and a
subagent to the principal.
When a listing broker is preparing an Offer to Purchase for a buyer customer, contingencies
involving inspections or approval by a third party should
1. have short deadlines.
2. be discouraged by the broker.
3. be stated as briefly as possible.
4. be limited to mortgage arrangements. - ✔️✔️1. have short deadlines.
An investment property returns 12% of its value or $21,000 annually. What is the value of the
property?
1. $100,000
2. $175,000
, 3. $235,200
4. $252,000 - ✔️✔️175,000, (21,000/.12)
Earnest money should be deposited into a trust account
1. in a timely manner, according to state laws.
2. upon removal of all contingencies.
3. at the broker's discretion.
4. according to MLS rules. - ✔️✔️in a timely manner, according to state laws.
Even after an offer has been accepted and is binding, the buyer and seller may still choose to sign
mutual release papers rather than proceed to closing. Which of the following circumstances would
NOT give either party a justifiable reason to insist on a mutual release?
1. The buyer finds a better property for better terms.
2. A title defect that will take months to clear is discovered.
3. A basement fire causes damage that requires extensive repairs.
4. The buyer is unable to obtain financing that meets the terms of the contract's financing
contingency. - ✔️✔️1. The buyer finds a better property for better terms.
A prospective buyer made an offer to purchase a property. The owner responded with a
counteroffer. While the buyer was reviewing the counteroffer, the owner received a better offer.
The owner can accept the second offer if
1. it satisfies or exceeds all terms included in the counteroffer.
2. the owner withdraws the counteroffer before it is accepted.
