,This study document brings together 149 carefully worded exam questions drawn from TEXAS
REAL ESTATE SALESPERSON STATE PREP EXAM 2 Most Recent exam COMPLETE (2026)
EXAM Questions and Answers (Verified Answers) (Latest Update 2026) UPDATE!!, with the
strongest emphasis placed on Apply Texas Real Estate License Act (TRELA) and TREC rules to
complex agency and transaction scenarios, Analyze contracts, financing instruments, and property
descriptions to determine legal rights and obligations, Evaluate property valuation, appraisal
methods and and market conditions to advise clients accurately. Every item follows the wording
style and level of reasoning you meet in the real paper, and each one is paired with a clear
rationale so the correct choice is never a guess. Work through the set at your own pace, mark the
questions that slow you down, then come back to them until the reasoning feels automatic.
Learners who revise this way walk into the exam room recognising the pattern behind the
questions instead of meeting them for the first time. Keep going - steady, honest practice is what
turns a difficult paper into a comfortable pass.
Q1 APPLY TEXAS REAL ESTATE LICENSE ACT (TRELA) AND TREC RULES TO COMPLEX
AGENCY AND TRANSACTION SCENARIOS
Under the Texas Real Estate License Act, which scenario constitutes unauthorized
practice of law by a salesperson?
A. Explaining the meaning of a standard promulgated contract clause to a client.
B. Drafting a special warranty deed for a client using a TREC form. CORRECT
C. Negotiating a lease agreement for a commercial property.
D. Advising a client on the tax implications of a 1031 exchange.
RATIONALE: Drafting a deed is considered the practice of law, which salespersons cannot do
unless they are licensed attorneys. Explaining promulgated contract clauses, negotiating leases,
and advising on tax implications (if not giving legal advice) are generally permissible under
TRELA and TREC rules.
Page 2
,Q2 APPLY TEXAS REAL ESTATE LICENSE ACT (TRELA) AND TREC RULES TO COMPLEX
AGENCY AND TRANSACTION SCENARIOS
A broker receives a $10,000 earnest money deposit. The buyer and seller dispute
its return. Under TREC rules, what is the broker's required action?
A. Hold the funds until a court order is issued.
B. Return the funds to the buyer immediately.
C. Send written notification to both parties and deposit the funds with TREC within 30 days if not
resolved. CORRECT
D. Divide the funds equally between the parties.
RATIONALE: TREC rules require the broker to send written notice to both parties and, if the
dispute is not resolved within 30 days, deposit the funds with TREC. Holding indefinitely,
returning to buyer unilaterally, or splitting funds without agreement violates TREC rules.
Q3 APPLY TEXAS REAL ESTATE LICENSE ACT (TRELA) AND TREC RULES TO COMPLEX
AGENCY AND TRANSACTION SCENARIOS
Which of the following best describes the legal effect of a lis pendens filed against
a property?
A. It transfers title to the lienholder.
B. It provides constructive notice of a pending lawsuit affecting title. CORRECT
C. It automatically forecloses on the property.
D. It removes all existing liens from the property.
RATIONALE: A lis pendens is a public notice that a lawsuit is pending that may affect title to the
property. It does not transfer title, foreclose, or remove liens; it serves as constructive notice to
potential buyers.
Page 3
, Q4 APPLY TEXAS REAL ESTATE LICENSE ACT (TRELA) AND TREC RULES TO COMPLEX
AGENCY AND TRANSACTION SCENARIOS
A property is appraised at $300,000. The assessed value is 80% of market value,
and the tax rate is $2.50 per $100. What is the annual property tax?
A. $6,000 CORRECT
B. $7,500
C. $5,000
D. $6,500
RATIONALE: Assessed value = $300,000 × 0.80 = $240,000. Tax = ($240,) × $2.50 =
$6,000. Other options miscalculate the assessed value or tax rate.
Q5 APPLY TEXAS REAL ESTATE LICENSE ACT (TRELA) AND TREC RULES TO COMPLEX
AGENCY AND TRANSACTION SCENARIOS
Under the Texas Deceptive Trade Practices Act, which party may be held liable for
a salesperson's misrepresentation about a property's condition?
A. Only the salesperson personally.
B. Only the broker.
C. Both the salesperson and the broker. CORRECT
D. Neither, if the misrepresentation was unintentional.
RATIONALE: Under the DTPA, both the salesperson and the broker can be held liable for
misrepresentations made during a real estate transaction, even if unintentional, due to vicarious
liability and the statute's consumer protection provisions.
Page 4
REAL ESTATE SALESPERSON STATE PREP EXAM 2 Most Recent exam COMPLETE (2026)
EXAM Questions and Answers (Verified Answers) (Latest Update 2026) UPDATE!!, with the
strongest emphasis placed on Apply Texas Real Estate License Act (TRELA) and TREC rules to
complex agency and transaction scenarios, Analyze contracts, financing instruments, and property
descriptions to determine legal rights and obligations, Evaluate property valuation, appraisal
methods and and market conditions to advise clients accurately. Every item follows the wording
style and level of reasoning you meet in the real paper, and each one is paired with a clear
rationale so the correct choice is never a guess. Work through the set at your own pace, mark the
questions that slow you down, then come back to them until the reasoning feels automatic.
Learners who revise this way walk into the exam room recognising the pattern behind the
questions instead of meeting them for the first time. Keep going - steady, honest practice is what
turns a difficult paper into a comfortable pass.
Q1 APPLY TEXAS REAL ESTATE LICENSE ACT (TRELA) AND TREC RULES TO COMPLEX
AGENCY AND TRANSACTION SCENARIOS
Under the Texas Real Estate License Act, which scenario constitutes unauthorized
practice of law by a salesperson?
A. Explaining the meaning of a standard promulgated contract clause to a client.
B. Drafting a special warranty deed for a client using a TREC form. CORRECT
C. Negotiating a lease agreement for a commercial property.
D. Advising a client on the tax implications of a 1031 exchange.
RATIONALE: Drafting a deed is considered the practice of law, which salespersons cannot do
unless they are licensed attorneys. Explaining promulgated contract clauses, negotiating leases,
and advising on tax implications (if not giving legal advice) are generally permissible under
TRELA and TREC rules.
Page 2
,Q2 APPLY TEXAS REAL ESTATE LICENSE ACT (TRELA) AND TREC RULES TO COMPLEX
AGENCY AND TRANSACTION SCENARIOS
A broker receives a $10,000 earnest money deposit. The buyer and seller dispute
its return. Under TREC rules, what is the broker's required action?
A. Hold the funds until a court order is issued.
B. Return the funds to the buyer immediately.
C. Send written notification to both parties and deposit the funds with TREC within 30 days if not
resolved. CORRECT
D. Divide the funds equally between the parties.
RATIONALE: TREC rules require the broker to send written notice to both parties and, if the
dispute is not resolved within 30 days, deposit the funds with TREC. Holding indefinitely,
returning to buyer unilaterally, or splitting funds without agreement violates TREC rules.
Q3 APPLY TEXAS REAL ESTATE LICENSE ACT (TRELA) AND TREC RULES TO COMPLEX
AGENCY AND TRANSACTION SCENARIOS
Which of the following best describes the legal effect of a lis pendens filed against
a property?
A. It transfers title to the lienholder.
B. It provides constructive notice of a pending lawsuit affecting title. CORRECT
C. It automatically forecloses on the property.
D. It removes all existing liens from the property.
RATIONALE: A lis pendens is a public notice that a lawsuit is pending that may affect title to the
property. It does not transfer title, foreclose, or remove liens; it serves as constructive notice to
potential buyers.
Page 3
, Q4 APPLY TEXAS REAL ESTATE LICENSE ACT (TRELA) AND TREC RULES TO COMPLEX
AGENCY AND TRANSACTION SCENARIOS
A property is appraised at $300,000. The assessed value is 80% of market value,
and the tax rate is $2.50 per $100. What is the annual property tax?
A. $6,000 CORRECT
B. $7,500
C. $5,000
D. $6,500
RATIONALE: Assessed value = $300,000 × 0.80 = $240,000. Tax = ($240,) × $2.50 =
$6,000. Other options miscalculate the assessed value or tax rate.
Q5 APPLY TEXAS REAL ESTATE LICENSE ACT (TRELA) AND TREC RULES TO COMPLEX
AGENCY AND TRANSACTION SCENARIOS
Under the Texas Deceptive Trade Practices Act, which party may be held liable for
a salesperson's misrepresentation about a property's condition?
A. Only the salesperson personally.
B. Only the broker.
C. Both the salesperson and the broker. CORRECT
D. Neither, if the misrepresentation was unintentional.
RATIONALE: Under the DTPA, both the salesperson and the broker can be held liable for
misrepresentations made during a real estate transaction, even if unintentional, due to vicarious
liability and the statute's consumer protection provisions.
Page 4
