PSI Real Estate Salesperson Exam Prep GRADED
A+ (ACTUAL EXAM ) Questions and Answers
(Solved)
1). Fungible
Ans: Replaceable
2). 1031 tax deferred exchange
Ans: Under section 1031 of the Irs code, some or all of the realized gain from the
exchange of one property for a like kind of property may be deferred. It is not a tax free
event; however, in order to accumulate wealth the payment is deferred.
3). Abandonment
Ans: The voluntary and permanent cessation of use or enjoyment with no intention to
resume or reclaim one's possession or interest . May pertain to an easement of a
property.
4). Abstract of title
Ans: A condensed version of the history of the title to a particular parcel of real estate
as recorded in the county clerks records; consists of a summary of the original grant and
subsequent conveyances and encumbrances effecting the property.
5). Abutting
Ans: The joining, reaching, or touching of adjoining land. Abutting parcels of land have
common boundary.
6). Accelerated depreciation
Ans: A method of calculating for tax purposes the depreciation of income property at
a faster rate than would be achieved using the straight line method. Note that any
depreciations taken in excess of what would be claimed using the straight line method is
subject to recapture as ordinary income to the extent of the gain resulting from the sale.
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, 7). Acceleration clause
Ans: A provision in a written mortgage, note, bond or conditional sales contract that in
the event of default, the whole amount of the principal and the interest may be declared
due payable at once.
8). Accession
Ans: Title to improvements or additions to real property is acquired as a result of the
accretion of alluvial deposits alongside the banks of streams, or as a result of the
annexation of fixtures.
9). Accretion
Ans: An increase or addition to land by the deposit of sand or soil washed up naturally
from a river, lake , or sea.
10). Accrued depreciation
Ans: The actual depreciation that has occurred to a property at any given date; the
difference between the cost of replacement new( as of the date of the appraisal) and the
present appraised valued.
11). Acknowledgement
Ans: A declaration made by a person to notary public or other public official
authorized to take acknowledgements that an instrument was executed by him or her as
a free and voluntary act.
12). Actual eviction
Ans: The result of legal action originated by a lessor, by which a defaulted tenant I'd
physically ousted from the rented property pursuant to a court order.
13). Actual notice
Ans: Express information or fact; that which is known; actual knowledge.
14). Administrator
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, Ans: The party appointed by the county court to settle the estate of a deceased
person who died without leaving a will.
15). Ad valorem tax
Ans: A tax levied according to value; generally used to refer to real estate tax. Also
called general tax.
16). Adverse possession
Ans: The actual, visible, hostile, notorious, exclusive, and continuous possession of
another's land under a claim to title. Possession for a statutory period may be a means
of acquiring title.
17). Affidavit
Ans: A written statement signed and sworn on or before a person authorized to
administer an oath.
18). Agent
Ans: One represents or has the power to act for another person (called the principal) .
The authorization may be express, implied, or apparent. A fiduciary relationship is
created under the law of agency when a property owner, as the principal, executes a
listing agreement or management contract authorizing a licensed real estate broker to
be his or her agent.
19). Agreement of sale
Ans: A written agreement by which the purchaser agrees to buy certain real estate
and the seller agrees to sell, on the terms and conditions set forth in the agreement.
20). Air lot
Ans: A designated airspace over a piece of land. Air lots, like surface property, may be
transferred.
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, 21). Air rights
Ans: The right to use the open space above ones property. It can be sold to build a
skywalk or for a utility company to erect power lines.
22). Alienation
Ans: The act of transferring property to another. Alienation may be voluntary, such as
by sale, or involuntary such as through eminent domain.
23). Alienation clause ( due on sale clause)
Ans: Clause in a mortgage instrument that does not allow the borrower to sell
(without lender approval) on assumption or contract for deed. If an attempt is made to
do so without prior approval , all of the mortgaged balance becomes due on the sale of
the property.
24). Allusion
Ans: The actual soil increase resulting from accretion.
25). Amendments
Ans: Changes to previously approved and adopted written agreements are
amendments. For example , in a condominium association and original policy may allow
the renting of units and later amend the rule requiring unit owners to live in their units for
at least one year before leasing.
26). Amentities
Ans: Neighborhood facilities and services that enhance a properties value They are
always outside of the property swimming pools, three car garages, decks etc. that are on
the property are called features.
27). Americans with disabilities act
Ans: A federal law, effective in 1992, designed to eliminate discrimination against
individuals with disabilities.
28). Amortization
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