California Department of Real Estate (DRE)
Salesperson Exam EXAM , QUESTIONS AND
CORRECT ANSWERS (VERIFIED ANSWERS) PLUS
RATIONALES 2026 Q&A | INSTANT DOWNLOAD
PDF
1. What type of ownership allows two or more individuals to own a
property with equal shares and rights of survivorship?
A. Tenancy in Common
B. Joint Tenancy
C. Community Property
D. Tenancy by the Entirety
B
Because joint tenancy gives equal shares plus right of survivorship
— when one dies, the other(s) automatically inherit the decedent’s
share.
2. Which fiduciary duty requires an agent to act in the best interest
of their client, even above their own interests?
A. Accounting
B. Obedience
C. Loyalty
D. Disclosure
C
Loyalty means the agent must prioritize the principal’s interest
over their own.
3. Which approach is generally used to estimate the value of
single-family residences?
, A. Cost Approach
B. Income Approach
C. Comparative Market Analysis / Sales Comparison Approach
D. Gross Rent Multiplier
C
Because comparable sales of similar homes give the best
indication of market value for single-family residential property.
4. Which type of mortgage allows for adjustments in interest rates
over time?
A. Fixed-rate mortgage
B. Adjustable-rate mortgage (ARM)
C. Balloon mortgage
D. Reverse mortgage
B
An ARM’s interest rate can change periodically based on an index
or rate schedule.
5. What type of listing allows the owner to sell the property
themselves without paying a commission to the broker (unless the
broker procured the buyer)?
A. Exclusive Right to Sell Listing
B. Exclusive Agency Listing
C. Open Listing
D. Net Listing
C
With an open listing, the owner retains the right to sell on their
own and avoid paying a commission.
6. Under agency law, which of the following duties does an agent
owe to a principal?
A. Loyalty
, B. Disclosure
C. Obedience
D. All of the above
D
Agents owe all core fiduciary duties — loyalty, disclosure,
obedience, plus accounting, confidentiality, etc.
7. Which deed conveys whatever interest the grantor has at the time
— but makes no guarantee that the title is good?
A. General Warranty Deed
B. Special Warranty Deed
C. Grant Deed
D. Quitclaim Deed
D
A quitclaim deed transfers whatever interest (if any) the grantor
has — with no warranties about validity or defects.
8. In property financing, what does “LTV” stand for?
A. Loan–to-Value ratio
B. Loan–to-Valuation index
C. Liability–to-Value ratio
D. Lease–to-Value ratio
A
LTV is the ratio of the loan amount to the property’s value — a key
metric for lenders assessing risk.
9. Which listing agreement gives the broker the exclusive right to
earn a commission — regardless of who sells the property?
A. Open Listing
B. Exclusive Agency Listing
C. Exclusive Right to Sell Listing
D. Net Listing
, C
Because the broker earns a commission even if the owner sells the
property directly.
10. What is “commingling” in real estate brokerage practice?
A. Mixing client funds with the broker’s personal funds
B. Mixing client funds with the broker’s general business account
C. Mixing one client’s funds with another client’s funds
D. Any of the above
D
Commingling refers to improper mixing of client monies with
broker’s accounts or other funds, which is prohibited. Studocu+1
11. Which method is most appropriate to appraise a new office
building or shopping center?
A. Sales Comparison Approach
B. Cost Approach
C. Income Approach
D. Gross Rent Multiplier
C
Because income-producing commercial properties are best valued
based on their potential income generation.
realtorprep101.com+1
12. Which of the following terminates an agency relationship?
A. Death of a principal
B. Destruction of the property
C. Mutual agreement by parties
D. All of the above
D
Agency ends when a principal dies, the property no longer exists,
or the parties agree to terminate.
Salesperson Exam EXAM , QUESTIONS AND
CORRECT ANSWERS (VERIFIED ANSWERS) PLUS
RATIONALES 2026 Q&A | INSTANT DOWNLOAD
1. What type of ownership allows two or more individuals to own a
property with equal shares and rights of survivorship?
A. Tenancy in Common
B. Joint Tenancy
C. Community Property
D. Tenancy by the Entirety
B
Because joint tenancy gives equal shares plus right of survivorship
— when one dies, the other(s) automatically inherit the decedent’s
share.
2. Which fiduciary duty requires an agent to act in the best interest
of their client, even above their own interests?
A. Accounting
B. Obedience
C. Loyalty
D. Disclosure
C
Loyalty means the agent must prioritize the principal’s interest
over their own.
3. Which approach is generally used to estimate the value of
single-family residences?
, A. Cost Approach
B. Income Approach
C. Comparative Market Analysis / Sales Comparison Approach
D. Gross Rent Multiplier
C
Because comparable sales of similar homes give the best
indication of market value for single-family residential property.
4. Which type of mortgage allows for adjustments in interest rates
over time?
A. Fixed-rate mortgage
B. Adjustable-rate mortgage (ARM)
C. Balloon mortgage
D. Reverse mortgage
B
An ARM’s interest rate can change periodically based on an index
or rate schedule.
5. What type of listing allows the owner to sell the property
themselves without paying a commission to the broker (unless the
broker procured the buyer)?
A. Exclusive Right to Sell Listing
B. Exclusive Agency Listing
C. Open Listing
D. Net Listing
C
With an open listing, the owner retains the right to sell on their
own and avoid paying a commission.
6. Under agency law, which of the following duties does an agent
owe to a principal?
A. Loyalty
, B. Disclosure
C. Obedience
D. All of the above
D
Agents owe all core fiduciary duties — loyalty, disclosure,
obedience, plus accounting, confidentiality, etc.
7. Which deed conveys whatever interest the grantor has at the time
— but makes no guarantee that the title is good?
A. General Warranty Deed
B. Special Warranty Deed
C. Grant Deed
D. Quitclaim Deed
D
A quitclaim deed transfers whatever interest (if any) the grantor
has — with no warranties about validity or defects.
8. In property financing, what does “LTV” stand for?
A. Loan–to-Value ratio
B. Loan–to-Valuation index
C. Liability–to-Value ratio
D. Lease–to-Value ratio
A
LTV is the ratio of the loan amount to the property’s value — a key
metric for lenders assessing risk.
9. Which listing agreement gives the broker the exclusive right to
earn a commission — regardless of who sells the property?
A. Open Listing
B. Exclusive Agency Listing
C. Exclusive Right to Sell Listing
D. Net Listing
, C
Because the broker earns a commission even if the owner sells the
property directly.
10. What is “commingling” in real estate brokerage practice?
A. Mixing client funds with the broker’s personal funds
B. Mixing client funds with the broker’s general business account
C. Mixing one client’s funds with another client’s funds
D. Any of the above
D
Commingling refers to improper mixing of client monies with
broker’s accounts or other funds, which is prohibited. Studocu+1
11. Which method is most appropriate to appraise a new office
building or shopping center?
A. Sales Comparison Approach
B. Cost Approach
C. Income Approach
D. Gross Rent Multiplier
C
Because income-producing commercial properties are best valued
based on their potential income generation.
realtorprep101.com+1
12. Which of the following terminates an agency relationship?
A. Death of a principal
B. Destruction of the property
C. Mutual agreement by parties
D. All of the above
D
Agency ends when a principal dies, the property no longer exists,
or the parties agree to terminate.
