[SOUTH CAROLINA REAL ESTATE EXAM] COMPLETE EXAM
QUESTIONS AND VERIFIED ANSWERS | 2026–2027 LATEST
UPDATE | GUARANTEED PASS | DETAILED RATIONALES |
FULL STUDY GUIDE | EXAM PREP | PRACTICE TEST |
CERTIFICATION PREPARATION
1. A real estate licensee is helping a buyer understand property ownership rights. Which form of
ownership provides the right of survivorship?
A. Tenancy in common
B. Sole ownership
C. Joint tenancy
D. Life estate
Correct Answer: C. Joint tenancy
Rationale:
Joint tenancy includes the right of survivorship, meaning a deceased owner's interest automatically
passes to surviving owners. Tenancy in common does not provide survivorship rights.
2. Which government power allows a municipality to enforce zoning regulations?
A. Police power
B. Eminent domain
C. Taxation
D. Escheat
Correct Answer: A. Police power
Rationale:
Police power enables state and local governments to regulate land use for public health, safety, and
welfare. Zoning ordinances are a common exercise of this authority.
3. A broker receives earnest money from a buyer. What is the broker's primary responsibility
regarding those funds?
A. Deposit them into a personal account temporarily
B. Hold them according to trust account requirements
C. Transfer them immediately to the seller
D. Use them for office operating expenses
Correct Answer: B. Hold them according to trust account requirements
Rationale:
Earnest money must be handled according to trust account rules to protect client funds and maintain
regulatory compliance.
4. What is the primary purpose of title insurance?
A. Protect against future maintenance costs
B. Guarantee property appreciation
C. Cover mortgage payments
D. Protect against defects in title
Correct Answer: D. Protect against defects in title
Rationale:
,Title insurance protects owners and lenders against covered title defects that may have existed
before the policy was issued.
5. Which type of listing gives one broker the exclusive right to earn compensation regardless of
who finds the buyer?
A. Open listing
B. Net listing
C. Exclusive-right-to-sell listing
D. Exclusive agency listing
Correct Answer: C. Exclusive-right-to-sell listing
Rationale:
Under an exclusive-right-to-sell agreement, the broker is entitled to compensation if the property sells
during the listing period, regardless of who procures the buyer.
6. A property owner loses ownership because property taxes remain unpaid. Which government
power is involved?
A. Police power
B. Escheat
C. Eminent domain
D. Taxation
Correct Answer: D. Taxation
Rationale:
Taxation allows government entities to assess taxes and enforce collection, including tax liens and
foreclosure proceedings.
7. What is the legal relationship created when a seller hires a broker to represent the seller's
interests?
A. Partnership
B. Agency
C. Easement
D. Tenancy
Correct Answer: B. Agency
Rationale:
Agency is created when a principal authorizes an agent to act on the principal's behalf in a fiduciary
capacity.
8. Which document transfers ownership of real property from a grantor to a grantee?
A. Lease
B. Listing agreement
C. Mortgage
D. Deed
Correct Answer: D. Deed
Rationale:
A deed is the legal instrument used to transfer ownership interests in real property.
9. A buyer wants assurance that a property's boundaries are accurately identified. Which service is
most appropriate?
A. Appraisal
B. Survey
C. Home warranty
, D. Property disclosure
Correct Answer: B. Survey
Rationale:
A survey identifies property boundaries, encroachments, and related land measurements.
10. Which characteristic of value refers to the desirability of a property's location?
A. Scarcity
B. Transferability
C. Utility
D. Demand
Correct Answer: D. Demand
Rationale:
Demand reflects the desire and ability of buyers to purchase property and is heavily influenced by
location and market appeal.
11. A homeowner grants a neighbor the right to cross a portion of the property. What has been
created?
A. Encroachment
B. Easement
C. Lien
D. License transfer
Correct Answer: B. Easement
Rationale:
An easement grants a nonpossessory right to use another person's land for a specific purpose.
12. Which approach to value is most commonly used for owner-occupied residential properties?
A. Cost approach
B. Income approach
C. Sales comparison approach
D. Depreciation approach
Correct Answer: C. Sales comparison approach
Rationale:
Residential properties are often valued by comparing similar recently sold properties in the market.
13. A buyer signs a purchase contract and later discovers the seller intentionally concealed a major
defect. What legal issue may exist?
A. Novation
B. Fraud
C. Estoppel
D. Subrogation
Correct Answer: B. Fraud
Rationale:
Intentional concealment of a material fact may constitute fraud and can expose the seller to legal
liability.
14. Which clause in a mortgage allows the lender to demand immediate repayment if the property
is sold?
A. Escalation clause
B. Defeasance clause
C. Acceleration clause
QUESTIONS AND VERIFIED ANSWERS | 2026–2027 LATEST
UPDATE | GUARANTEED PASS | DETAILED RATIONALES |
FULL STUDY GUIDE | EXAM PREP | PRACTICE TEST |
CERTIFICATION PREPARATION
1. A real estate licensee is helping a buyer understand property ownership rights. Which form of
ownership provides the right of survivorship?
A. Tenancy in common
B. Sole ownership
C. Joint tenancy
D. Life estate
Correct Answer: C. Joint tenancy
Rationale:
Joint tenancy includes the right of survivorship, meaning a deceased owner's interest automatically
passes to surviving owners. Tenancy in common does not provide survivorship rights.
2. Which government power allows a municipality to enforce zoning regulations?
A. Police power
B. Eminent domain
C. Taxation
D. Escheat
Correct Answer: A. Police power
Rationale:
Police power enables state and local governments to regulate land use for public health, safety, and
welfare. Zoning ordinances are a common exercise of this authority.
3. A broker receives earnest money from a buyer. What is the broker's primary responsibility
regarding those funds?
A. Deposit them into a personal account temporarily
B. Hold them according to trust account requirements
C. Transfer them immediately to the seller
D. Use them for office operating expenses
Correct Answer: B. Hold them according to trust account requirements
Rationale:
Earnest money must be handled according to trust account rules to protect client funds and maintain
regulatory compliance.
4. What is the primary purpose of title insurance?
A. Protect against future maintenance costs
B. Guarantee property appreciation
C. Cover mortgage payments
D. Protect against defects in title
Correct Answer: D. Protect against defects in title
Rationale:
,Title insurance protects owners and lenders against covered title defects that may have existed
before the policy was issued.
5. Which type of listing gives one broker the exclusive right to earn compensation regardless of
who finds the buyer?
A. Open listing
B. Net listing
C. Exclusive-right-to-sell listing
D. Exclusive agency listing
Correct Answer: C. Exclusive-right-to-sell listing
Rationale:
Under an exclusive-right-to-sell agreement, the broker is entitled to compensation if the property sells
during the listing period, regardless of who procures the buyer.
6. A property owner loses ownership because property taxes remain unpaid. Which government
power is involved?
A. Police power
B. Escheat
C. Eminent domain
D. Taxation
Correct Answer: D. Taxation
Rationale:
Taxation allows government entities to assess taxes and enforce collection, including tax liens and
foreclosure proceedings.
7. What is the legal relationship created when a seller hires a broker to represent the seller's
interests?
A. Partnership
B. Agency
C. Easement
D. Tenancy
Correct Answer: B. Agency
Rationale:
Agency is created when a principal authorizes an agent to act on the principal's behalf in a fiduciary
capacity.
8. Which document transfers ownership of real property from a grantor to a grantee?
A. Lease
B. Listing agreement
C. Mortgage
D. Deed
Correct Answer: D. Deed
Rationale:
A deed is the legal instrument used to transfer ownership interests in real property.
9. A buyer wants assurance that a property's boundaries are accurately identified. Which service is
most appropriate?
A. Appraisal
B. Survey
C. Home warranty
, D. Property disclosure
Correct Answer: B. Survey
Rationale:
A survey identifies property boundaries, encroachments, and related land measurements.
10. Which characteristic of value refers to the desirability of a property's location?
A. Scarcity
B. Transferability
C. Utility
D. Demand
Correct Answer: D. Demand
Rationale:
Demand reflects the desire and ability of buyers to purchase property and is heavily influenced by
location and market appeal.
11. A homeowner grants a neighbor the right to cross a portion of the property. What has been
created?
A. Encroachment
B. Easement
C. Lien
D. License transfer
Correct Answer: B. Easement
Rationale:
An easement grants a nonpossessory right to use another person's land for a specific purpose.
12. Which approach to value is most commonly used for owner-occupied residential properties?
A. Cost approach
B. Income approach
C. Sales comparison approach
D. Depreciation approach
Correct Answer: C. Sales comparison approach
Rationale:
Residential properties are often valued by comparing similar recently sold properties in the market.
13. A buyer signs a purchase contract and later discovers the seller intentionally concealed a major
defect. What legal issue may exist?
A. Novation
B. Fraud
C. Estoppel
D. Subrogation
Correct Answer: B. Fraud
Rationale:
Intentional concealment of a material fact may constitute fraud and can expose the seller to legal
liability.
14. Which clause in a mortgage allows the lender to demand immediate repayment if the property
is sold?
A. Escalation clause
B. Defeasance clause
C. Acceleration clause
