State & National Real Estate PSI Practice Questions

Asian Americans

"For rent by owner. Share townhouse, 3 bdrm. 2 ba. conv. to shops and trans. Call 123-4567 for details. No agents or _________________." All of the following descriptions can legally complete the advertisement, EXCEPT: Select one: A. Asian Americans B. Females C. Handicapped persons D. Families with teenagers

Improper dealing

A broker placed one of her signs on property without permission from the owner. The broker is guilty of: Select one: A. Misrepresentation B. Violation of anti-trust laws C. Improper dealing D. Disparate impact

Taking a listing with intent to change the racial make-up of the neighborhood

A broker would violate the Virginia Fair Housing Act by doing which of the following acts? Select one: A. Refusing to list commercial property that is owned by a minority B. Advertising in a publication whose subscribers are all members of a minority group C. Refusing to show expensive property to persons that are not financially qualified D. Taking a listing with intent to change the racial make-up of the neighborhood

May allow unlicensed employees (on a regular salary) to sell the tracts

A builder wants to sell tracts of land that he owns. This person: Select one: A. Must have a broker's license B. May allow unlicensed employees (on a regular salary) to sell the tracts C. May only employ licensees to sell each tract D. Must register with the Real Estate Board

Put this information into the written offer

A buyer gives her salesperson a note, payable at settlement, as an earnest money deposit for a home. The salesperson must do which of the following actions? Select one: A. Put this information into the written offer B. Immediately give the note to her broker for deposit in the escrow account C. Immediately call the seller on the telephone D. Tell the buyer to forget it

Yes, the property value will increase

A property is valued using the income approach to valuation. If the capitalization rate remains the same, but the NOI increases, will the property value be affected? Select one: A. Yes, the property value will decrease B. No, the property value will remain the same C. Yes, the property value will increase D. There is not enough information to choose an answer

Seek an injunction, forcing the owner to tear down the addition

A property owner obtains a permit to add a bedroom onto her house. Her neighbors notice that an addition would violate setback restrictions in the owner's deed. What is the best course of action for any affected neighbors? Select one: A. Sue for damages B. Nothing. The country sanctioned the addition by issuing a building permit C. Seek an injunction, forcing the owner to tear down the addition D. Ask the county to revoke her building permit

No, these funds must be placed in a separate escrow account

A real estate broker wishes to deposit an earnest money check in his business operating account so the purchaser can earn a higher interest rate on her funds. Can he do this? Select one: A. Yes, if the purchaser receives a comparison of available interest rates B. Yes, if the broker promises to ensure such funds will be available at closing C. No, these funds must be placed in a separate escrow account D. No, the broker cannot guarantee a higher interest rate

Advertises a listing at lower than listed price

A real estate salesperson's license may be revoked if the licensee: Select one: A. Sells insurance from the real estate office where she is employed B. Gives a reduced commission rate to a family member C. Charges more than the legal maximum commission rate D. Advertises a listing at lower than listed price

Disclose what the seller will accept, with the seller's permission

A seller lists her house with a broker for $189,500. The seller tells the broker that if necessary, she will accept $185,000. What may the broker do when showing the property to prospective buyers? Select one: A. Say that the seller will accept a few thousand less B. Suggest that the buyer should make an offer for $185,500 C. Advise the buyer that the seller is flexible D. Disclose what the seller will accept, with the seller's permission

Seller and buyer, jointly and severally

A seller sells her home to a buyer who assumes her existing loan. If the buyer defaults, who is responsible for the balance of the debt? Select one: A. Seller only B. Buyer only C. Seller and buyer, jointly D. Seller and buyer, jointly and severally

All of the above

According to the Virginia Landlord-Tenant Act, a landlord's right to access rented property is NOT restricted in which of the following circumstances? Select one: A. Abandonment B. Frozen water pipes C. Emergency situations D. All of the above

By the broker, according to the terms of the contract if neither party files a written objection

If a contract of sale is not consummated, how are escrow funds disbursed? Select one: A. By the settlement attorney, with permission of all parties B. By the broker, with written permission of the seller C. By the broker, according to the terms of the contract if neither party files a written objection D. By the broker, only upon notification of the court

The lease may be oral

If a tenant and a landlord enter into a 3-month lease that expires at the end of the year, which of the following is correct? Select one: A. The lease may be oral B. The tenant must give 30 days notice before terminating the lease C. The landlord must give 30 days notice before terminating the lease D. The lease will extend for another term if the parties fail to provide proper notice

All of the above

In Virginia, what action is prohibited in an advertisement for real estate? Select one: A. Failing to get a client's written consent to advertise his property B. Failing to identify the type of services offered in a general property description C. Advertising that a property listed by a firm is for sale by owner D. All of the above

People from Hungary are moving into the neighborhood

It is a violation of Virginia License Law to induce another person into selling their property by representing that: Select one: A. Your brokerage firm will accept a lower commission rate B. The seller needs a larger house C. People from Hungary are moving into the neighborhood D. None of the above

Filed a claim against the salesperson in a court of competent jurisdiction

Kathy the Consumer has filed a claim for payment from the Transaction Recovery Fund. The reason for the claim is to reimburse a loss sustained after a salesperson made a gross misrepresentation. In order for Kathy to collect, she must have already: Select one: A. Filed a suit against the local Realtors Association B. Filed a claim against the salesperson in a court of competent jurisdiction C. Filed a claim against the salesperson's broker D. Filed a claim with HUD

Kerra filed suit against the local Association of Realtors

Kerra the Consumer has filed a claim for payment from the Transaction Recovery Fund. Which of the following statements must be incorrect? Select one: A. Kerra filed suit against the local Association of Realtors B. Kerra has obtained a judgement in court C. Kerra claim cannot include interest in her damages D. Kerra must wait until there is sufficient money in the Fund before payment

21 days

Licensees must respond to Board inquiries within: Select one: A. 10 days B. 15 days C. 21 days D. 31 days

No, this is proper marketing practice

Many Korean families have purchased homes in a specific neighborhood of your community. Now, local merchants are marketing to the Korean clientele. A Caucasian resident listed his house with your firm and you add the property to the MLS. You also place a bilingual ad in the newspaper and a bilingual "For Sale" sign on the property. Are your actions discriminatory? Select one: A. No, this is proper marketing practice B. No, because you are targeting the market most likely to purchase the property C. Yes, because national origin is protected by the 1968 Fair Housing Law D. Yes, because bilingual ads are a form of steering

Assignment

One's rights in a mortgage or lease may be transferred to another through a(n): Select one: A. Novation B. Assignment C. Deed of Trust D. Both B and C

Ralph has no interest in the property

Quincy sold a piece of property to Ralph, and transferred title through a quitclaim deed. Later, a court determined that Quincy did not own the property. Which of the following statements is true in this situation? Select one: A. Ralph owns the property because the court action happened after the transfer of title B. Ralph has no interest in the property C. Ralph has a good claim against Quincy for misrepresentation D. Both B and C

No, because it is permissible to provide a link to the required disclosures

Robert the Broker wants to stay on top of technological trends. Therefore, Robert decides to advertise his firm via banner ads on commercial web pages. Since the ad must be small, Robert makes no disclosures in the banner itself. Instead, Robert provides a link that redirects the user to his web page, which displays the necessary disclosures. Has Robert violated the rules? Select one: A. Yes, because the required disclosures must appear in the ad itself B. No, because it is permissible to provide a link to the required disclosures C. Yes, because his ad appears on another commercial site D. No, because the Board does not regulate banner advertising

Lisa is subject to Board censure for violation of Fair Housing laws

Salesperson Lisa is selling her townhouse to move into a luxury condominium. She advertised her property in the newspaper as follows: "Beautiful, 3 bedroom townhouse. Excellent assumption. Single females only. Call 123-4567 for details. Owner is licensed." Which of the following statements is true? Select one: A. Lisa has not violated Board regulations since she disclosed her license status B. Lisa has not violated the Virginia Fair Housing Act since it does not protect marital status C. Lisa has not violated Board regulations since she is not subject to the license laws D. Lisa is subject to Board censure for violation of Fair Housing laws

Bait and switch

Sarah Smith sees an ad from Broker Mark for a custom built home with mountain views, hardwood floors, a theatre room, and a professional kitchen. She goes to the address and finds that the listed property is actually a motor home. Mark is guilty of: Select one: A. Commingling B. Bait and switch C. Conversion D. None of the above

No, because the term is potentially indefinite

Seller Pruitt signed an exclusive right-to-sell listing with Broker Cook. The listing includes a 7% commission and a clause which states that this agreement is in effect until the house is sold. Is this legal? Select one: A. No, because the commission was over 6% B. No, because the term is potentially indefinite C. Yes, if it is a multiple listing D. Yes, assuming all other elements are satisfied

No, if Sally filed for bankruptcy

Susan and Sally enter into a buyer-broker agreement. However, Sally subsequently falls on hard times. Susan gets nervous and terminates the agreement. Is Susan in breach? Select one: A. Yes, if Sally is the broker B. No, so long as Sally takes no action C. No, if Sally filed for bankruptcy D. Yes, if both parties agreed

Within 3 days of the loan application

The Real Estate Settlement Procedures Act (RESPA) requires lending institutions to provide a Good Faith Estimate of closing costs: Select one: A. When the loan application is submitted B. Within 3 days of the loan application C. Within 3 days of closing D. Within 10 days of the loan application

Levy fines

The Virginia Real Estate Board is empowered to: Select one: A. Levy fines B. Reimburse aggrieved persons C. Adjudicate disputes between licensees D. Enforce the code of ethics

Seisin

The covenant in a deed where the grantor guarantees that she owns the property and has the right to sell it is known as: Select one: A. Seisin B. Against encumbrances C. Warranty forever D. Quiet enjoyment

7 days

The initial purchaser of a time-share estate has a statutory right to rescind a contract to purchase. How long is this rescission period? Select one: A. 5 days B. 7 days C. 10 days D. None of the above

Protect the public interest

The purpose of Virginia License Law and the Rules and Regulations is to: Select one: A. Make brokers and salespersons more professional B. Protect the public interest C. Enable licensed real estate professionals to earn more money D. Comply with federal law

Property Description

To be legally binding, a real estate sales contract MUST contain a: Select one: A. List of personal property B. Commission to be paid to the broker C. Property Description D. All of the above

A court having jurisdiction over the brokers

Two brokers are involved in a dispute over a commission split. Which of the following entities could become involved in settling the matter? Select one: A. A court having jurisdiction over the brokers B. The Virginia Real Estate Board C. The Director of the Department of Professional and Occupational Regulation (DPOR) D. The enforcement branch of DPOR

Whether the lender expects someone else to service the loan

Under RESPA, the Mortgage Servicing Statement informs borrowers of: Select one: A. All the payments expected to be deposited into the escrow account B. The actual fees and services that will be provided C. Whether the lender expects someone else to service the loan D. Settlement service charges that the borrower will likely have to pay

Counteroffer

What is an invitation to enter into a contract? Select one: A. Acceptance B. Counteroffer C. Contract D. All of the above

$100,000

What is the maximum amount that can be paid from the Transaction Recovery Fund for claims against the same licensee during a two year period? Select one: A. $10,000 B. $20,000 C. $50,000 D. $100,000

Nothing

What is wrong with this advertisement: "3 bdrm, 2 ba, $75,000. Ann Agent. Broker XYZ. Phone 123-4567"? Select one: A. Nothing B. No property location specified C. The agent's name appears before the broker's name D. It does not disclose the agent's license status

Love and affection

What would NOT be legally sufficient for use as consideration in a sales contract? Select one: A. Money B. Property C. Service D. Love and affection

The claimant assigns his rights to the Board, to the extent of the amount of money paid by the Fund

When a claim is paid from the Transaction Recovery fund, which of the following statements is true? Select one: A. The licensee named in the claim must post a bond in order to continue practicing real estate B. The claimant assigns his rights to the Board, to the extent of the amount of money paid by the Fund C. All claims submitted in relation to a licensee's misconduct in a single transaction may not exceed $20,000 D. All of the above

Refinancing

When an owner of real property obtains a new mortgage to pay off an old mortgage, it is known as: Select one: A. Refinancing B. Foreclosure C. Assumption D. Subordination

Cost

When appraising a public library, which of the following appraisal approaches would be considered most reliable? Select one: A. Market data B. Capitalization C. Income D. Cost

A commission received from an out-of-state broker

Which funds would NOT need to be held in an escrow account? Select one: A. Money received as a security deposit for rental housing B. An earnest money deposit, if closing is scheduled in less than 15 days C. An earnest money deposit of less than $500 D. A commission received from an out-of-state broker

Rectangular

Which method of legally property description relies on range lines? Select one: A. Vertical B. Lot, block, an subdivision C. Rectangular D. Monument

Refusing to cooperate on the sale of property listed exclusively

Which of the following actions is NOT a violation of Virginia License Law? Select one: A. Placing an earnest money deposit in an interest-bearing account, but failing to advise all parties of that fact B. Accepting a net listing C. Refusing to cooperate on the sale of property listed exclusively D. Showing a home to a prospective buyer before the owner has signed a listing agreement

Discharge of the broker by the principal

Which of the following circumstances will not terminate an agency by operation of law? Select one: A. Destruction of the property B. Discharge of the broker by the principal C. Death of the principal D. Death of the broker

The principle of highest and best use

Which of the following principles of value would a real estate salesperson consider first when preparing to do a CMA? Select one: A. The principle of conformity B. The principle of contribution C. The principle of substitution D. The principle of highest and best use

All of the above

Which of the following statements is true of S&Ls? Select one: A. They tend to offer higher interest rates on deposits than commercial banks B. They tend to be chartered by a federal or state government C. They could be regulated by the OCC or FDIC D. All of the above

The ad must include the date that the offer expires

prize to any person visits and inspects the property. Which of the following statements is true about the advertisement? Select one: A. The advertised time-share must be fully described B. The prize must be described in detail C. The ad must disclose the date that the prize will be awarded D. The ad must include the date that the offer expires

It is a partial acceptance of the original offer

Barry makes a $150,000 offer on Pam's home, subject to financing at 4%. Pam accepts Barry's offer, but only agrees to 6% financing. Which of the following statements is INCORRECT concerning Pam's acceptance? Select one: A. It is a partial acceptance of the original offer B. Barry is now the offeree C. Pam rejected Barry's offer D. Pam may withdraw her offer at any time, prior to acceptance by Barry