Trec Exam Prep questions with complete
solutions
What type of contract can be described as a contract where one party can rescind - correct answer
✔✔voidable
Which is an example of an enforceable bilateral real estate contract? - correct answer ✔✔A written sales
contract
A home has a current market value of $225,000. MLS data from the last five years shows that home
values have appreciated 6% per year. If this trend continues, what will be the value of the house 5 years
from now assuming compound appreciation? - correct answer ✔✔$301,101.00
When a prospective buyer asks about a property's location regarding flood zones, the license holder
should direct the buyer to: - correct answer ✔✔obtain an up-to-date floodplain map from FEMA
Which of the following is the responsibility of the broker? - correct answer ✔✔The listing
advertisements of the sales agents he sponsors
The total hours required at the end of your SAE renewal period consist of: - correct answer ✔✔270
qualifying hours plus 8 hours of Legal 1 & 2 (278 total)
What real estate contract is an exception to the Statute of Frauds? - correct answer ✔✔A lease for one
year or less
Mary, an unlicensed individual, owns a three-family property. She lives in one unit and rents out the
other two. She chooses to discriminate when selecting her tenants. As long as the services of a broker
are not involved and she does not discriminate in her advertising, she can discriminate for any reason
except: - correct answer ✔✔Color/Race
When the acts or conduct of a license holder leads a consumer to believe that licensee is representing
the consumer's best interests this is an example of: - correct answer ✔✔implied agency
,TREC rules require a license holder to disclose his dual role if he is representing himself in a transaction.
TREC also requires a license holder to disclose if his client is a business entity in which the broker or
salesperson owns: - correct answer ✔✔more than 10%
Which of the following actions is NOT a violation of the Texas Real Estate License Act? - correct answer
✔✔A broker offers a guaranteed buy back of a property for a set price, if the purchaser is not happy with
the investment after a two-year period of ownership
In the event of a conflict between the statutory duties of Intermediary and the common law duties of
dual agency of a broker, which takes precedence? - correct answer ✔✔Statutory Intermediary
When a property has an easement appurtenant, which of the following is true? - correct answer ✔✔the
easement limits the servient estate
Mary, a single woman with no children, owns her own home. She dies intestate. What happens to her
property? - correct answer ✔✔the courts will appoint an administrator to settle her estate.
A designated agent is: - correct answer ✔✔one appointed by a broker in a dual agency situation
Who is eligible for a TVLB loan? - correct answer ✔✔eligible spouses
An agent switched brokers in the middle of a sale where the house is already under contract. What is
true? - correct answer ✔✔The first broker is the primary broker for the transaction.
Joe received payment from his title insurance company to compensate him for a defect in his title.
Subsequently he was awarded a judgment against the seller, and collected the funds from the seller, to
compensate him for the same defect. The title company has claimed the right to a refund from Joe.
What clause in the title policy allows the title company to make this claim? - correct answer
✔✔Subrogation
Which of the following is NOT a contributing factor in mold growth? - correct answer ✔✔Adequate
ventilation
, A license holder is showing a property with a pond. He notices iridescence on the surface of the pond
and is concerned about the possible causes. What should the license holder do? - correct answer
✔✔Mention his concerns about the pond and tell the buyer to seek expert advice
A court order directing the county sheriff to seize and sell property of a debtor to satisfy a lien is: -
correct answer ✔✔A writ of execution
An apartment complex is advertising for new tenants. Which of the following statements in advertising
would violate Fair Housing Laws? - correct answer ✔✔No alcoholics
Which of the following are requirements for a real estate contract to be valid? - correct answer
✔✔Competent parties, consideration, legal purpose
Which statement about a 1031 is TRUE? - correct answer ✔✔At the time of the 1031, capital gains taxes
are deferred.
What is the primary reason that broker-client money commingling is illegal? - correct answer ✔✔a
creditor of the broker could seize the account if it held broker funds
An unlicensed person owns an option to purchase real property for a $190,000. He advertises the option
for sale for $20,000. This action is: - correct answer ✔✔only legal with full disclosure of the terms of the
option
Multiple choice question
A seller's disclosure is not required: - correct answer ✔✔On new construction that has not been
occupied
A broker has received a referral from his neighbor. The referral results in a sale and the broker earns a
commission on the transaction. How can he thank his unlicensed neighbor for the referral? - correct
answer ✔✔No commission
Many states require a seller's disclosure of property condition. Which statement about a seller's
disclosure is FALSE? - correct answer ✔✔Both the broker and the seller are responsible for the accuracy
of the disclosure form.
solutions
What type of contract can be described as a contract where one party can rescind - correct answer
✔✔voidable
Which is an example of an enforceable bilateral real estate contract? - correct answer ✔✔A written sales
contract
A home has a current market value of $225,000. MLS data from the last five years shows that home
values have appreciated 6% per year. If this trend continues, what will be the value of the house 5 years
from now assuming compound appreciation? - correct answer ✔✔$301,101.00
When a prospective buyer asks about a property's location regarding flood zones, the license holder
should direct the buyer to: - correct answer ✔✔obtain an up-to-date floodplain map from FEMA
Which of the following is the responsibility of the broker? - correct answer ✔✔The listing
advertisements of the sales agents he sponsors
The total hours required at the end of your SAE renewal period consist of: - correct answer ✔✔270
qualifying hours plus 8 hours of Legal 1 & 2 (278 total)
What real estate contract is an exception to the Statute of Frauds? - correct answer ✔✔A lease for one
year or less
Mary, an unlicensed individual, owns a three-family property. She lives in one unit and rents out the
other two. She chooses to discriminate when selecting her tenants. As long as the services of a broker
are not involved and she does not discriminate in her advertising, she can discriminate for any reason
except: - correct answer ✔✔Color/Race
When the acts or conduct of a license holder leads a consumer to believe that licensee is representing
the consumer's best interests this is an example of: - correct answer ✔✔implied agency
,TREC rules require a license holder to disclose his dual role if he is representing himself in a transaction.
TREC also requires a license holder to disclose if his client is a business entity in which the broker or
salesperson owns: - correct answer ✔✔more than 10%
Which of the following actions is NOT a violation of the Texas Real Estate License Act? - correct answer
✔✔A broker offers a guaranteed buy back of a property for a set price, if the purchaser is not happy with
the investment after a two-year period of ownership
In the event of a conflict between the statutory duties of Intermediary and the common law duties of
dual agency of a broker, which takes precedence? - correct answer ✔✔Statutory Intermediary
When a property has an easement appurtenant, which of the following is true? - correct answer ✔✔the
easement limits the servient estate
Mary, a single woman with no children, owns her own home. She dies intestate. What happens to her
property? - correct answer ✔✔the courts will appoint an administrator to settle her estate.
A designated agent is: - correct answer ✔✔one appointed by a broker in a dual agency situation
Who is eligible for a TVLB loan? - correct answer ✔✔eligible spouses
An agent switched brokers in the middle of a sale where the house is already under contract. What is
true? - correct answer ✔✔The first broker is the primary broker for the transaction.
Joe received payment from his title insurance company to compensate him for a defect in his title.
Subsequently he was awarded a judgment against the seller, and collected the funds from the seller, to
compensate him for the same defect. The title company has claimed the right to a refund from Joe.
What clause in the title policy allows the title company to make this claim? - correct answer
✔✔Subrogation
Which of the following is NOT a contributing factor in mold growth? - correct answer ✔✔Adequate
ventilation
, A license holder is showing a property with a pond. He notices iridescence on the surface of the pond
and is concerned about the possible causes. What should the license holder do? - correct answer
✔✔Mention his concerns about the pond and tell the buyer to seek expert advice
A court order directing the county sheriff to seize and sell property of a debtor to satisfy a lien is: -
correct answer ✔✔A writ of execution
An apartment complex is advertising for new tenants. Which of the following statements in advertising
would violate Fair Housing Laws? - correct answer ✔✔No alcoholics
Which of the following are requirements for a real estate contract to be valid? - correct answer
✔✔Competent parties, consideration, legal purpose
Which statement about a 1031 is TRUE? - correct answer ✔✔At the time of the 1031, capital gains taxes
are deferred.
What is the primary reason that broker-client money commingling is illegal? - correct answer ✔✔a
creditor of the broker could seize the account if it held broker funds
An unlicensed person owns an option to purchase real property for a $190,000. He advertises the option
for sale for $20,000. This action is: - correct answer ✔✔only legal with full disclosure of the terms of the
option
Multiple choice question
A seller's disclosure is not required: - correct answer ✔✔On new construction that has not been
occupied
A broker has received a referral from his neighbor. The referral results in a sale and the broker earns a
commission on the transaction. How can he thank his unlicensed neighbor for the referral? - correct
answer ✔✔No commission
Many states require a seller's disclosure of property condition. Which statement about a seller's
disclosure is FALSE? - correct answer ✔✔Both the broker and the seller are responsible for the accuracy
of the disclosure form.
