Alabama State Practice Exam questions
with complete solutions
Which of the following is an example of commingling?
c c c c c c c c
Mixing earnest money with personal funds.
c c c c c
Mixing two earnest money deposits.
c c c c
Paying licensee bonuses from forfeited escrow deposits.
c c c c c c
Using escrow funds to pay business expenses. - answer-Mixing earnest money with
c c c c c c c c c c c
personal funds
c c
Agent Walt has met with Diane, a seller, three times. The first time, she told him she
c c c c c c c c c c c c c c c c
wanted him to help her sell her house. The second time, at the open house, Diane told
c c c c c c c c c c c c c c c c c
him, "Honestly, I want to list this place for $400,000, but I'd be open to offers as low as
c c c c c c c c c c c c c c c c c c c
$315,000." The third time, Walt presented three offers to Diane. When should he have
c c c c c c c c c c c c c c
presented her with the Real Estate Brokerage Services Disclosure form?
c c c c c c c c c c
After Diane's comment about the listing price, because that's when she revealed
c c c c c c c c c c c
confidential information.
c c
After presenting Diane with the three offers.
c c c c c c
At their first meeting, after Diane asked him for representation.
c c c c c c c c c
Before presenting Diane with the three offers. - answer-At their first meeting, after Diane
c c c c c c c c c c c c c
asked him for representation.
c c c c
Robert didn't complete his post-licensing education within six months of obtaining his
c c c c c c c c c c c
temporary Alabama real estate license. Can he continue to work as a salesperson?
c c c c c c c c c c c c c
No, his license will be placed on inactive status.
c c c c c c c c
No, his license will lapse and he will need to complete all post-licensing requirements.
c c c c c c c c c c c c c
Yes, as long as he completes it within two years.
c c c c c c c c c
Yes, provided he pays the late fee. - answer-No, his license will be placed on inactive
c c c c c c c c c c c c c c c
status.
c
Greta is working with agent Brandon to sell some property. Nelson represents the buyer,
c c c c c c c c c c c c c
Rigby. Of these four parties, who will pay the earnest money?
c c c c c c c c c c c
Brandon
Greta
Nelson
Rigby - answer-Rigby
c c
,In addition to serving as the listing agent for several clients, your own house is also on
c c c c c c c c c c c c c c c c
cthe market. You receive a call from another licensee who wants to show her buyer client
c c c c c c c c c c c c c c c
cyour house. What must you immediately disclose to the buyer's agent and buyer?
c c c c c c c c c c c c
The house may have been an orphanage 80 years ago.
c c c c c c c c c
You'd sell for far lower than the current asking price.
c c c c c c c c c
You own the property.
c c c
Your housemate has swine flu last month. - answer-You own the property.
c c c c c c c c c c c
Walt has been through a hearing, an appeal, and a rehearing. The court has just handed
c c c c c c c c c c c c c c c
down its judgment and has upheld the commission's decision. What can Walt expect
c c c c c c c c c c c c c
now?
c
He can decide to take the commission to court.
c c c c c c c c
He will have to pay the commission a fine between $100-$2,500.
c c c c c c c c c c
He will need to pay the court costs.
c c c c c c c
His license will be automatically suspended for at least three months. - answer-He will
c c c c c c c c c c c c c
need to pay the court costs.
c c c c c c
The ______ enforces Alabama real estate rules and regulations.
c c c c c c c c
Alabama Licensing Authority c c
Alabama Real Estate Commission c c c
Department of Justice c c
State Licensing Bureau - answer-Alabama Real Estate Commission
c c c c c c c
Which of the following statements about material facts is true?
c c c c c c c c c
All material facts are related to physical conditions.
c c c c c c c
All parties considering a property would regard each material fact in the same way.
c c c c c c c c c c c c c
A material fact may have more or less effect on a buyer based on the buyer's needs and
c c c c c c c c c c c c c c c c c
values.
c
Material facts are only those that can be easily seen or discovered. - answer-A material
c c c c c c c c c c c c c c
fact may have more or less effect on a buyer based on the buyer's needs and values.
c c c c c c c c c c c c c c c c c
Simone is chatting with Phil, who's about to close on a house. Simone's become good
c c c c c c c c c c c c c c
friends with Phil during the transaction. She's gotten to know him while printing his
c c c c c c c c c c c c c c
transaction-related documents and making sure he's signed where he needs to. The two
c c c c c c c c c c c c c
of them don't have a written agency agreement. In what capacity is Simone acting in this
c c c c c c c c c c c c c c c c
transaction?
c
She's acting as the buyer's agent.
c c c c c
She's a limited consensual dual agent.
c c c c c
She's a sub-agent. c c
She's a transactional broker. - answer-She's a transactional broker.
c c c c c c c c
How many hours of post-licensing education are active temporary salespeople required
c c c c c c c c c c
to take in Alabama?
c c c c
15.
20.
25.
, 30. - answer-30 hours.
c c c
Which of the following is NOT considered a license law violation?
c c c c c c c c c c
Accepting commission or valuables from someone other than the qualifying broker.
c c c c c c c c c c
Committing fraud, misrepresentation, and deceit. c c c c
Failing to disclose a property's material defects.
c c c c c c
Listing a family member's home, with proper disclosure. - answer-Listing a family
c c c c c c c c c c c
member's home, with proper disclosure.
c c c c c
Chester is moving on up! He and his wife are ready to sell their condo and purchase a
c c c c c c c c c c c c c c c c c
new place. Chester is a real estate licensee and will list the property himself. What must
c c c c c c c c c c c c c c c c
Chester disclose to prospective buyers?
c c c c c
Chester doesn't need to disclose anything to buyers.
c c c c c c c
He owns the property.
c c c
The sellers are eager to sell.
c c c c c
The sellers will not accept any offers below $300,000. - answer-He owns the property.
c c c c c c c c c c c c c
Jill needs to pay the web developer who created a new website for her brokerage, but
c c c c c c c c c c c c c c c
her checking account is low, so she floats herself a loan from earnest money kept in the
c c c c c c c c c c c c c c c c c
brokerage's escrow account to pay the developer. Which answer correctly identifies the
c c c c c c c c c c c c
violation(s) Jill has committed?
c c c c
Commingling and conversion. c c
Commingling only. c
Conversion and fraud. c c
Deceptive business practice. - answer-Commingling and conversion.
c c c c c c
AREC is looking for a new commission member to fill the "consumer" slot. Which of the
c c c c c c c c c c c c c c c
following people is eligible?
c c c c
Cynthia, age 55, who has a master's degree and has lived in Alabama for the past five
c c c c c c c c c c c c c c c c
years.
c
Sylvia, a registered voter, whose uncle Doug is the most successful real estate broker in
c c c c c c c c c c c c c c
Evergreen.
c
Terry, 43, who worked as a real estate licensee until he was 28. He now owns a small
c c c c c c c c c c c c c c c c c
bakery in Tuscaloosa.
c c c
Timothy, age 20, an African American, who own a condominium complex in
c c c c c c c c c c c
Birmingham. - answer-Terry, 43, who worked as a real estate licensee until he was 28.
c c c c c c c c c c c c c c c
He now owns a bakery in Tuscaloosa.
c c c c c c c
For which of the following actions can the Alabama Real Estate Commission impose a
c c c c c c c c c c c c c
penalty on licensee Joseph?
c c c c
Disclosing possible conflicts of interest. c c c c
Falsely promising his customer that she wouldn't have to pay closing costs.
c c c c c c c c c c c
Reassigning his listings and taking a leave of absence. c c c c c c c c
Renewing his license 10 days late. - answer-Falsely promising his customer that she
c c c c c c c c c c c c
wouldn't have to pay closing costs.
c c c c c c
with complete solutions
Which of the following is an example of commingling?
c c c c c c c c
Mixing earnest money with personal funds.
c c c c c
Mixing two earnest money deposits.
c c c c
Paying licensee bonuses from forfeited escrow deposits.
c c c c c c
Using escrow funds to pay business expenses. - answer-Mixing earnest money with
c c c c c c c c c c c
personal funds
c c
Agent Walt has met with Diane, a seller, three times. The first time, she told him she
c c c c c c c c c c c c c c c c
wanted him to help her sell her house. The second time, at the open house, Diane told
c c c c c c c c c c c c c c c c c
him, "Honestly, I want to list this place for $400,000, but I'd be open to offers as low as
c c c c c c c c c c c c c c c c c c c
$315,000." The third time, Walt presented three offers to Diane. When should he have
c c c c c c c c c c c c c c
presented her with the Real Estate Brokerage Services Disclosure form?
c c c c c c c c c c
After Diane's comment about the listing price, because that's when she revealed
c c c c c c c c c c c
confidential information.
c c
After presenting Diane with the three offers.
c c c c c c
At their first meeting, after Diane asked him for representation.
c c c c c c c c c
Before presenting Diane with the three offers. - answer-At their first meeting, after Diane
c c c c c c c c c c c c c
asked him for representation.
c c c c
Robert didn't complete his post-licensing education within six months of obtaining his
c c c c c c c c c c c
temporary Alabama real estate license. Can he continue to work as a salesperson?
c c c c c c c c c c c c c
No, his license will be placed on inactive status.
c c c c c c c c
No, his license will lapse and he will need to complete all post-licensing requirements.
c c c c c c c c c c c c c
Yes, as long as he completes it within two years.
c c c c c c c c c
Yes, provided he pays the late fee. - answer-No, his license will be placed on inactive
c c c c c c c c c c c c c c c
status.
c
Greta is working with agent Brandon to sell some property. Nelson represents the buyer,
c c c c c c c c c c c c c
Rigby. Of these four parties, who will pay the earnest money?
c c c c c c c c c c c
Brandon
Greta
Nelson
Rigby - answer-Rigby
c c
,In addition to serving as the listing agent for several clients, your own house is also on
c c c c c c c c c c c c c c c c
cthe market. You receive a call from another licensee who wants to show her buyer client
c c c c c c c c c c c c c c c
cyour house. What must you immediately disclose to the buyer's agent and buyer?
c c c c c c c c c c c c
The house may have been an orphanage 80 years ago.
c c c c c c c c c
You'd sell for far lower than the current asking price.
c c c c c c c c c
You own the property.
c c c
Your housemate has swine flu last month. - answer-You own the property.
c c c c c c c c c c c
Walt has been through a hearing, an appeal, and a rehearing. The court has just handed
c c c c c c c c c c c c c c c
down its judgment and has upheld the commission's decision. What can Walt expect
c c c c c c c c c c c c c
now?
c
He can decide to take the commission to court.
c c c c c c c c
He will have to pay the commission a fine between $100-$2,500.
c c c c c c c c c c
He will need to pay the court costs.
c c c c c c c
His license will be automatically suspended for at least three months. - answer-He will
c c c c c c c c c c c c c
need to pay the court costs.
c c c c c c
The ______ enforces Alabama real estate rules and regulations.
c c c c c c c c
Alabama Licensing Authority c c
Alabama Real Estate Commission c c c
Department of Justice c c
State Licensing Bureau - answer-Alabama Real Estate Commission
c c c c c c c
Which of the following statements about material facts is true?
c c c c c c c c c
All material facts are related to physical conditions.
c c c c c c c
All parties considering a property would regard each material fact in the same way.
c c c c c c c c c c c c c
A material fact may have more or less effect on a buyer based on the buyer's needs and
c c c c c c c c c c c c c c c c c
values.
c
Material facts are only those that can be easily seen or discovered. - answer-A material
c c c c c c c c c c c c c c
fact may have more or less effect on a buyer based on the buyer's needs and values.
c c c c c c c c c c c c c c c c c
Simone is chatting with Phil, who's about to close on a house. Simone's become good
c c c c c c c c c c c c c c
friends with Phil during the transaction. She's gotten to know him while printing his
c c c c c c c c c c c c c c
transaction-related documents and making sure he's signed where he needs to. The two
c c c c c c c c c c c c c
of them don't have a written agency agreement. In what capacity is Simone acting in this
c c c c c c c c c c c c c c c c
transaction?
c
She's acting as the buyer's agent.
c c c c c
She's a limited consensual dual agent.
c c c c c
She's a sub-agent. c c
She's a transactional broker. - answer-She's a transactional broker.
c c c c c c c c
How many hours of post-licensing education are active temporary salespeople required
c c c c c c c c c c
to take in Alabama?
c c c c
15.
20.
25.
, 30. - answer-30 hours.
c c c
Which of the following is NOT considered a license law violation?
c c c c c c c c c c
Accepting commission or valuables from someone other than the qualifying broker.
c c c c c c c c c c
Committing fraud, misrepresentation, and deceit. c c c c
Failing to disclose a property's material defects.
c c c c c c
Listing a family member's home, with proper disclosure. - answer-Listing a family
c c c c c c c c c c c
member's home, with proper disclosure.
c c c c c
Chester is moving on up! He and his wife are ready to sell their condo and purchase a
c c c c c c c c c c c c c c c c c
new place. Chester is a real estate licensee and will list the property himself. What must
c c c c c c c c c c c c c c c c
Chester disclose to prospective buyers?
c c c c c
Chester doesn't need to disclose anything to buyers.
c c c c c c c
He owns the property.
c c c
The sellers are eager to sell.
c c c c c
The sellers will not accept any offers below $300,000. - answer-He owns the property.
c c c c c c c c c c c c c
Jill needs to pay the web developer who created a new website for her brokerage, but
c c c c c c c c c c c c c c c
her checking account is low, so she floats herself a loan from earnest money kept in the
c c c c c c c c c c c c c c c c c
brokerage's escrow account to pay the developer. Which answer correctly identifies the
c c c c c c c c c c c c
violation(s) Jill has committed?
c c c c
Commingling and conversion. c c
Commingling only. c
Conversion and fraud. c c
Deceptive business practice. - answer-Commingling and conversion.
c c c c c c
AREC is looking for a new commission member to fill the "consumer" slot. Which of the
c c c c c c c c c c c c c c c
following people is eligible?
c c c c
Cynthia, age 55, who has a master's degree and has lived in Alabama for the past five
c c c c c c c c c c c c c c c c
years.
c
Sylvia, a registered voter, whose uncle Doug is the most successful real estate broker in
c c c c c c c c c c c c c c
Evergreen.
c
Terry, 43, who worked as a real estate licensee until he was 28. He now owns a small
c c c c c c c c c c c c c c c c c
bakery in Tuscaloosa.
c c c
Timothy, age 20, an African American, who own a condominium complex in
c c c c c c c c c c c
Birmingham. - answer-Terry, 43, who worked as a real estate licensee until he was 28.
c c c c c c c c c c c c c c c
He now owns a bakery in Tuscaloosa.
c c c c c c c
For which of the following actions can the Alabama Real Estate Commission impose a
c c c c c c c c c c c c c
penalty on licensee Joseph?
c c c c
Disclosing possible conflicts of interest. c c c c
Falsely promising his customer that she wouldn't have to pay closing costs.
c c c c c c c c c c c
Reassigning his listings and taking a leave of absence. c c c c c c c c
Renewing his license 10 days late. - answer-Falsely promising his customer that she
c c c c c c c c c c c c
wouldn't have to pay closing costs.
c c c c c c
