TREC State Exam Practice Questions &
Answers
1. TREC has the power to order witnesses to appear and/or produce records of documents for
its investigations and hearings. This is called subpoena power. If a license holder fails to respond
to a subpoena, what can TREC do?
(a) TREC can assess an administrative penalty against the license holder for up to $4,000.
(b) TREC can immediately revoke the license of the license holder without a hearing.
(c) TREC can file suit with the Attorney General to enforce the subpoena.
(d) TREC can file charges of felony against the license holder, based on fraud. - ANSWERS(c)
TREC can file suit with the Attorney General to enforce the subpoena.
2. A license holder in violation of the TRELA has received a summons from TREC that a hearing
will be held regarding the possible revocation or suspension of his license. The license holder
fails to respond to the summons. What will TREC do?
(a) Schedule a hearing in the county court where the license holder practices real estate
(b) Schedule a hearing at the TREC office in Austin
(c) Schedule a hearing in the district court serving the license holder
,(d) Schedule a hearing at the main office or business address of the license holder -
ANSWERS(b) Schedule a hearing at the TREC office in Austin
3. With the knowledge and consent of her broker/employer, an unlicensed assistant is showing
property to prospective buyers. What is true about this situation?
(a) The broker and unlicensed assistant are both guilty of a third degree felony
(b) Both the broker and unlicensed assistant can be fined an administrative penalty of $5,000
per day
(c) Only the unlicensed assistant can be fined by TREC for this activity
(d) Only the broker can be fined by TREC for this activity - ANSWERS(b) Both the broker and
unlicensed assistant can be fined an administrative penalty of $5,000 per day
4. TREC has received an application for a Texas Real Estate Sales License from Mary. Mary has
completed all her educational requirements, and passed the state exam. At this point TREC will
begin the background check. Which of the following statements is FALSE?
(a) TREC has no time limit for determining integrity
(b) TREC has 30 days to complete the background check
(c) TREC has 30 days to notify Mary of a decision to disapprove her application
(d) Mary has 10 days to appeal a denial of her application - ANSWERS(b) TREC has 30 days to
complete the background check
,TREC has no limit on days to review your application or complete your background check. They
have 30 days to notify you of their decision and you have 10 days to appeal that decision.
5. Marcos was a Texas licensed Real Estate Sales agent for some time. He then chose to become
inactive and TREC has been holding his license in inactive status. He now wishes to activate the
license. What will he have to do?
(a) Apply through a broker, pay $50 and take a 30-hour continuing education course
(b) Apply through a broker, pay $200 and take a 30-hour continuing education course
(c) Apply through a broker, pay $50 and take a 18-hour continuing education course
(d) Apply through a broker, pay $200 and take a 15-hour continuing education course -
ANSWERS(c) Apply through a broker, pay $50 and take a 18-hour continuing education course
6. A license holder has defaulted on his Texas State Student loans. As a result of this TREC will:
(a) require the license holder to pay a $200 penalty to renew his license
(b) revoke the license of the license holder immediately
(c) refuse to renew the license of this individual unless and until the loan payments are brought
up to date
(d) require the license holder to move his license to inactive status - ANSWERS(c) refuse to
renew the license of this individual unless and until the loan payments are brought up to date
, 7. When a license holder markets his own property, he should:
(a) Use the IABS to disclose his interest in the property
(b) Use the TREC promulgated form to disclose his interest in the property
(c) Not mention his interest unless the buyer decides to buy the property
(d) Inform the buyer that he is a license holder, and the owner of the property - ANSWERS(d)
Inform the buyer that he is a license holder, and the owner of the property
8. A Texas broker may pay a commission to:
(a) A foreign broker who doesn't negotiate in Texas
(b) A licensed attorney in Texas
(c) An in-house employee of a principal
(d) Any unlicensed person for a referral - ANSWERS(a) A foreign broker who doesn't negotiate in
Texas
9. Which of the following actions is NOT a violation of the Texas Real Estate License Act?
(a) 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
Answers
1. TREC has the power to order witnesses to appear and/or produce records of documents for
its investigations and hearings. This is called subpoena power. If a license holder fails to respond
to a subpoena, what can TREC do?
(a) TREC can assess an administrative penalty against the license holder for up to $4,000.
(b) TREC can immediately revoke the license of the license holder without a hearing.
(c) TREC can file suit with the Attorney General to enforce the subpoena.
(d) TREC can file charges of felony against the license holder, based on fraud. - ANSWERS(c)
TREC can file suit with the Attorney General to enforce the subpoena.
2. A license holder in violation of the TRELA has received a summons from TREC that a hearing
will be held regarding the possible revocation or suspension of his license. The license holder
fails to respond to the summons. What will TREC do?
(a) Schedule a hearing in the county court where the license holder practices real estate
(b) Schedule a hearing at the TREC office in Austin
(c) Schedule a hearing in the district court serving the license holder
,(d) Schedule a hearing at the main office or business address of the license holder -
ANSWERS(b) Schedule a hearing at the TREC office in Austin
3. With the knowledge and consent of her broker/employer, an unlicensed assistant is showing
property to prospective buyers. What is true about this situation?
(a) The broker and unlicensed assistant are both guilty of a third degree felony
(b) Both the broker and unlicensed assistant can be fined an administrative penalty of $5,000
per day
(c) Only the unlicensed assistant can be fined by TREC for this activity
(d) Only the broker can be fined by TREC for this activity - ANSWERS(b) Both the broker and
unlicensed assistant can be fined an administrative penalty of $5,000 per day
4. TREC has received an application for a Texas Real Estate Sales License from Mary. Mary has
completed all her educational requirements, and passed the state exam. At this point TREC will
begin the background check. Which of the following statements is FALSE?
(a) TREC has no time limit for determining integrity
(b) TREC has 30 days to complete the background check
(c) TREC has 30 days to notify Mary of a decision to disapprove her application
(d) Mary has 10 days to appeal a denial of her application - ANSWERS(b) TREC has 30 days to
complete the background check
,TREC has no limit on days to review your application or complete your background check. They
have 30 days to notify you of their decision and you have 10 days to appeal that decision.
5. Marcos was a Texas licensed Real Estate Sales agent for some time. He then chose to become
inactive and TREC has been holding his license in inactive status. He now wishes to activate the
license. What will he have to do?
(a) Apply through a broker, pay $50 and take a 30-hour continuing education course
(b) Apply through a broker, pay $200 and take a 30-hour continuing education course
(c) Apply through a broker, pay $50 and take a 18-hour continuing education course
(d) Apply through a broker, pay $200 and take a 15-hour continuing education course -
ANSWERS(c) Apply through a broker, pay $50 and take a 18-hour continuing education course
6. A license holder has defaulted on his Texas State Student loans. As a result of this TREC will:
(a) require the license holder to pay a $200 penalty to renew his license
(b) revoke the license of the license holder immediately
(c) refuse to renew the license of this individual unless and until the loan payments are brought
up to date
(d) require the license holder to move his license to inactive status - ANSWERS(c) refuse to
renew the license of this individual unless and until the loan payments are brought up to date
, 7. When a license holder markets his own property, he should:
(a) Use the IABS to disclose his interest in the property
(b) Use the TREC promulgated form to disclose his interest in the property
(c) Not mention his interest unless the buyer decides to buy the property
(d) Inform the buyer that he is a license holder, and the owner of the property - ANSWERS(d)
Inform the buyer that he is a license holder, and the owner of the property
8. A Texas broker may pay a commission to:
(a) A foreign broker who doesn't negotiate in Texas
(b) A licensed attorney in Texas
(c) An in-house employee of a principal
(d) Any unlicensed person for a referral - ANSWERS(a) A foreign broker who doesn't negotiate in
Texas
9. Which of the following actions is NOT a violation of the Texas Real Estate License Act?
(a) 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
