PA Real Estate fundamentals Questions and 100%
Correct Answers Latest Update for 2025/2026
RELRA - ✔✔Statutory law enacted by the state legislature and signed into law by the
governor
Types of leases - ✔✔gross lease, net lease, percentage lease
Government Powers (PETE) - ✔✔Police power
Eminent domain - right of the government to get privately owned estate for public use.
Condemnation refers to the process of exercising that right
Taxation- charge on real estate to raise funds to meet the needs of a govt they include annual real
estate taxes, school taxes etc.
Escheat - process by which the state may acquire privately owned real or personal property
What happens when a seller breaches agreements? - ✔✔If seller breaches a real estate
agreement of sale, the buyer may sue for specific performance unless the contract specifically
states otherwise "suit for specific performance " - buyer asks the court to force the seller to go
thru with the sale and convey the property as previously agreed
Novation - ✔✔Substitution of a new contract In place of the original one
Statute of Limitations - ✔✔State law that limits the time with in which the parties to a
contract and may bring legal suit to enforce their rights. In PA it's 4 years
Statute of Frauds - ✔✔The part of a state law that requires that certain instruments, such as
deeds, real estate sales contracts, and certain leases, be in writing to be legally enforceable.
Title Insurance - ✔✔a contract under which the policyholder is protected from losses arising
from defects in the title.
,proof of ownership - ✔✔evidence that title is marketable. In PA it's a certificate of title
Chain of Title - ✔✔The succession of conveyances, from some accepted starting point,
whereby the present holder of real property derives title.
Asbestos - ✔✔a mineral that forms long, thin, microscopic fibers; used as an insulator against
heat and sound that can cause respiratory diseases.
Encapsulation - ✔✔Can prevent asbestos from becoming airborne
Assessment - ✔✔The imposition of a tax, charge, or levy, usually according to established
rates.
Constructive Notice - ✔✔The legal presumption that information has been obtained by an
individual through due diligence.
Actual Notice - ✔✔Not only that information of an interest in property is available but also
that someone is actually aware of it.
Consumer Notice - ✔✔A specific form adopted by the State Real Estate Commission in
Pennsylvania to disclose information about permitted business relationships and specific agency
procedures in real estate transactions. This notice must be presented at an initial interview to any
consumer of real estate services.
Straight Loan - ✔✔Aka term loan or an interest only loan , especially divides the loan into 2
amounts to be paid off separately
Amortized Loan - ✔✔A loan in which the principal as well as the interest is payable in
monthly or other periodic installments over the term of the loan. Interest is paid off first
, Fannie Mae - ✔✔The government-sponsored enterprise responsible for guaranteeing and
funding home mortgages in the secondary mortgage market from primary lenders
Freddie Mac - ✔✔A government supervised enterprise established to purchase primarily
conventional mortgage loans in the secondary mortgage market.
Ginnie Mae - ✔✔Sells mortgage backed securities that are backed by pools of fha and va
loans
Economic characteristics of real estate - ✔✔Scarcity, Location, Imporvements, Permanence
of Investment
Physical characteristics of real estate - ✔✔Immobility, Indestructibility, Uniqueness
Statute of Limitations - ✔✔A federal or state statute setting the maximum time period during
which a certain action can be brought or certain rights enforced. In PA it's 4 yrs
Discount Points - ✔✔A fee charged by the lender at settlement that results in increasing the
lender's effective yield on the money borrowed. One discount point equals one percent of the
loan amount.
ursury - ✔✔charging interest in excess than the maximum rate established by state law.
Broker - ✔✔Must be at least 21, 3yrs of salesperson experience, 240 hours of education
Purpose of License Laws - ✔✔Real estate license laws protect the public by ensuring a
standard of competence and professionalism in the real estate industry. The laws achieve this
goal by◾establishing basic requirements for obtaining a real estate license and, in most cases,
requiring continuing education to keep a license;◾defining which activities require
licensing;◾describing the acceptable standards of conduct and practice for licensees;
and◾enforcing those standards through a disciplinary system.
Correct Answers Latest Update for 2025/2026
RELRA - ✔✔Statutory law enacted by the state legislature and signed into law by the
governor
Types of leases - ✔✔gross lease, net lease, percentage lease
Government Powers (PETE) - ✔✔Police power
Eminent domain - right of the government to get privately owned estate for public use.
Condemnation refers to the process of exercising that right
Taxation- charge on real estate to raise funds to meet the needs of a govt they include annual real
estate taxes, school taxes etc.
Escheat - process by which the state may acquire privately owned real or personal property
What happens when a seller breaches agreements? - ✔✔If seller breaches a real estate
agreement of sale, the buyer may sue for specific performance unless the contract specifically
states otherwise "suit for specific performance " - buyer asks the court to force the seller to go
thru with the sale and convey the property as previously agreed
Novation - ✔✔Substitution of a new contract In place of the original one
Statute of Limitations - ✔✔State law that limits the time with in which the parties to a
contract and may bring legal suit to enforce their rights. In PA it's 4 years
Statute of Frauds - ✔✔The part of a state law that requires that certain instruments, such as
deeds, real estate sales contracts, and certain leases, be in writing to be legally enforceable.
Title Insurance - ✔✔a contract under which the policyholder is protected from losses arising
from defects in the title.
,proof of ownership - ✔✔evidence that title is marketable. In PA it's a certificate of title
Chain of Title - ✔✔The succession of conveyances, from some accepted starting point,
whereby the present holder of real property derives title.
Asbestos - ✔✔a mineral that forms long, thin, microscopic fibers; used as an insulator against
heat and sound that can cause respiratory diseases.
Encapsulation - ✔✔Can prevent asbestos from becoming airborne
Assessment - ✔✔The imposition of a tax, charge, or levy, usually according to established
rates.
Constructive Notice - ✔✔The legal presumption that information has been obtained by an
individual through due diligence.
Actual Notice - ✔✔Not only that information of an interest in property is available but also
that someone is actually aware of it.
Consumer Notice - ✔✔A specific form adopted by the State Real Estate Commission in
Pennsylvania to disclose information about permitted business relationships and specific agency
procedures in real estate transactions. This notice must be presented at an initial interview to any
consumer of real estate services.
Straight Loan - ✔✔Aka term loan or an interest only loan , especially divides the loan into 2
amounts to be paid off separately
Amortized Loan - ✔✔A loan in which the principal as well as the interest is payable in
monthly or other periodic installments over the term of the loan. Interest is paid off first
, Fannie Mae - ✔✔The government-sponsored enterprise responsible for guaranteeing and
funding home mortgages in the secondary mortgage market from primary lenders
Freddie Mac - ✔✔A government supervised enterprise established to purchase primarily
conventional mortgage loans in the secondary mortgage market.
Ginnie Mae - ✔✔Sells mortgage backed securities that are backed by pools of fha and va
loans
Economic characteristics of real estate - ✔✔Scarcity, Location, Imporvements, Permanence
of Investment
Physical characteristics of real estate - ✔✔Immobility, Indestructibility, Uniqueness
Statute of Limitations - ✔✔A federal or state statute setting the maximum time period during
which a certain action can be brought or certain rights enforced. In PA it's 4 yrs
Discount Points - ✔✔A fee charged by the lender at settlement that results in increasing the
lender's effective yield on the money borrowed. One discount point equals one percent of the
loan amount.
ursury - ✔✔charging interest in excess than the maximum rate established by state law.
Broker - ✔✔Must be at least 21, 3yrs of salesperson experience, 240 hours of education
Purpose of License Laws - ✔✔Real estate license laws protect the public by ensuring a
standard of competence and professionalism in the real estate industry. The laws achieve this
goal by◾establishing basic requirements for obtaining a real estate license and, in most cases,
requiring continuing education to keep a license;◾defining which activities require
licensing;◾describing the acceptable standards of conduct and practice for licensees;
and◾enforcing those standards through a disciplinary system.
