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Exam (elaborations)

National Real Estate Exam Practice (PSI): Certified Academic Excellence with Questions & Solutions on Agency, Contracts, Property Law, Finance & Fair Housing

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This comprehensive study guide is designed for real estate professionals preparing for the National Real Estate Exam Practice (PSI), featuring certified practice questions with complete solutions and detailed answer rationales compiled by global authorities. It provides extensive coverage of agency relationships and fiduciary duties including loyalty, disclosure, confidentiality, obedience, reasonable skill and care, and accounting, along with express and implied agency, ratification, sub-agency, dual agency, open agency, and buyer representation agreements. Property law and ownership content addresses joint tenancy, tenancy in common, fee simple defeasible, life estates including ordinary and pur autre vie, timeshare estates, cooperatives, condominiums, air rights, water rights including littoral and riparian rights, easements and rights of way, encroachments, avulsion, and the physical characteristics of land including immobility and uniqueness. Legal description content covers metes and bounds, rectangular government survey, lot and block, plat references, acreage and frontage calculations, and section/township terminology. Contract law topics include void and voidable contracts, statute of limitations, liquidated damages, earnest money and trust accounts, specific performance, mutual agreement, indemnification clauses, undue influence versus duress, counteroffers, and the Statute of Frauds. Real estate finance content covers loan-to-value ratios, conventional loans, FHA loans with MIP, VA loans, adjustable rate mortgages, discount points, loan origination fees, amortization calculations, PMI cancellation, transfer taxes, prorations, promissory notes, and the Truth in Lending Act and RESPA disclosures. Appraisal and valuation content addresses comparative market analysis, capitalization rate, net operating income, gross income multiplier, and home inspection findings including water damage, mold, roof issues, foundation problems, and pest infestations. Fair housing and ethics content covers protected classes including race, color, religion, sex, national origin, familial status, and disability, along with blockbusting, steering, redlining, group boycotting, market allocation, tie-in arrangements, antitrust violations, discriminatory advertising, Americans with Disabilities Act compliance, reasonable accommodations, and the Equal Credit Opportunity Act. Additional content covers zoning including aesthetic zoning, downzoning, spot zoning, bulk zoning, variances, special use permits, moratoriums, condemnation, deed restrictions, CC&Rs, homeowners association liens, property management, gross leases, net leases, security deposits, conversion of funds, escrow and trust account handling, title insurance and title defects, general warranty deeds, executor's deeds, recording deeds, constructive notice, UETA electronic signatures, RESPA, Telephone Consumer Protection Act, Government in the Sunshine Act, and the Clean Water Act. This exam guide is structured to build applied knowledge, critical thinking, and professional competence, making it an essential resource for achieving academic success and earning real estate licensure.

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National Real Estate Exam Practice (PSI): ...
Certified Academic Excellence with Questions
& Solutions Compiled by Global Authorities
Home inspector Murray is explaining to first-time buyers what he looks for during a home
inspection. What is his primary goal? - CORRECT ANS- -Document health and safety issues
that may affect both the cost and enjoyment of the home.



Frontage (or front foot) refers to what? - CORRECT ANS- -A property's boundary line that's
adjacent to a road or waterway



Helen is purchasing a home for $150,000 and provides a $2,500 earnest money check to
the seller. She's financing the transaction, and her closing costs and down payment total
$4,800. How much should Helen bring to the closing? - CORRECT ANS- -$2,300



Marsha's title insurance policy was issued on closing day, June 18. The policy lists the
standard exclusions as well as requirements for the company to issue the policy, such as
paying off existing recorded liens. Which of these will NOT be addressed in the schedule of
exceptions? - CORRECT ANS- -The local cable company's easement through the property
for underground wiring. Marsha disclosed this to the title company.



Which type of antitrust violation occurs when real estate firms agree to divide their market
so they don't compete with one another? - CORRECT ANS- -Market allocation



Jean is a licensee for At Home Realty. She chooses her own schedule, sets her own sales
goals, and is compensated based on commission. She must complete three training
courses each quarter and the required number of CE hours to maintain her license. She
must belong to the local REALTORS® association. The firm doesn't pay for employment
taxes for Jean. She receives no insurance or other benefits. Which of these factors might
cause the IRS to classify Jean as an employee instead of an IC? - CORRECT ANS- -She must
take three training classes through the firm.




Page 1 of 21 2025/2026

,Robert, who's 17 years old, signed a contract to purchase Stan's house. Stan didn't realize
Robert was underage until Robert's mother figured out what was happening and called
Robert's agent. Because Robert is a minor, the contract is voidable by whom? - CORRECT
ANS- -Robert



A _______ is a piece of real estate owned by multiple unrelated individuals who, in addition
to their ownership rights, each hold the right to occupy the dwelling unit based on the
specific terms of a timeshare agreement, usually in one- to two-week intervals during the
year. - CORRECT ANS- -Timeshare estate



Which of these areas would be included in the livable area calculation? - CORRECT ANS- -
A pool house connected to the house by a hallway

Eric owes $115,000 on his lakefront home, which he's selling for $350,000. He's spent
$73,000 in major renovations, and he wants to take that expense into consideration when
he calculates how much he'll actually pocket at closing. What number does he come up
with? - CORRECT ANS- -$162,000 ( ($350,000 - $115,000=$235,000) ($235,000 -
$73,000=$162,000))



Marvin knows that three-bedroom properties with two bathrooms sell quickest in his
market. In an ad for a new listing, he wrote, "Bonus room could easily be a third bedroom."
Marla and Tom visit the property with their agent, and Tom, a construction supervisor, notes
that the bonus room couldn't be easily converted to a bedroom because it's too small, it
has no egress and no heat source, and it can only be accessed by walking through a
bathroom. Is Marvin guilty of misrepresentation? - CORRECT ANS- -Yes, because he should
have known there would be major issues converting that room to a bedroom.



Ned is a listing agent who has learned of a material fact related to the transaction. To whom
and when must he disclose this information? - CORRECT ANS- -To all parties as soon as
possible




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, The Swansons left the family property to their son, Jason, with the stipulation that he does
not build on it. The type of estate Jason holds is ______. - CORRECT ANS- -Fee simple
defeasible



What is a township? - CORRECT ANS- -A 36-square-mile square formed in the use of the
rectangular government survey system



Sondrine's beach cottage has a right of way that allows nearby residents to get to the
beach. What is the primary difference between a right of way and an easement? -
CORRECT ANS- -A right of way provides a pass-through, but not a right to use the property.



Which of these circumstances does NOT require agent disclosure? - CORRECT ANS- -Marty
is representing Dwayne in both the sale of his current home and the purchase of his new
home.



How many parties does a deed of trust involve? - CORRECT ANS- -Three: borrower, lender,
and trustee



Tristan refused to let Marla list his property on the MLS, even though Marla told him that
more exposure to the property would generate more potential buyers. Which two fiduciary
duties are at odds in this situation? - CORRECT ANS- -Reasonable skill and care and
obedience



Reuben purchased a property from a seller who gave him a general warranty deed. What's
true of Reuben's deed to this property? - CORRECT ANS- -The deed provides the greatest
protection available from a grantor to a grantee.



Carly's closing on an REO property was suddenly delayed due to an internal audit. What
does this mean? - CORRECT ANS- -The lender has requested a title audit to ensure that the
foreclosure was properly handled.




Page 3 of 21 2025/2026

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