Exam (elaborations)
PSI National Exam for Real Estate Newest Edition | Updated 2024/25
- Course
- Institution
PSI National Exam for Real Estate Newest Edition | Updated 2024/25
[Show more]
Content preview
PSI National Exam for Real EstateNewest Edition | Updated 2024/25
A written agreement in which a purchaser agrees to buy and a seller agrees to sell is called
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
- Correct Answers a contract
ll ll ll ll ll ll ll ll
Antitrust laws prohibit competing brokers from all of the following - Correct Answers 1.
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
boycotting other brokers in the marketplace.
ll ll ll ll ll ll
2. dividing the market to restrict competition.
ll ll ll ll ll ll
3. agreeing to set sales commissions and management rates.
ll ll ll ll ll ll ll ll
When a sewer line is installed down a rural road, the cost will probably be shared by -
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
Correct Answers all current owners of real estate fronting on that road
ll ll ll ll ll ll ll ll ll ll ll ll ll ll
State laws differ on whether a buyer is entitled to know about - Correct Answers a suicide
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
that occurred in the house last year.
ll ll ll ll ll ll ll
ll A lawsuit for inverse condemnation may be brought by - Correct Answers a homeowner
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
When is racial discrimination in the rental of rooms or apartments permitted? - Correct
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
Answers Under no circumstances
ll ll ll ll ll ll
The real estate broker who is listing a house for sale should personally verify - Correct
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
Answers the number of square feet in the building
ll ll ll ll ll ll ll ll ll ll ll
ll Real property can be converted to personal property by - Correct Answers Severance
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
Prospective buyers made an offer on a property. The seller did NOT accept, but made a
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
counteroffer. The
ll ll
prospective buyers signed the counteroffer and the real estate agent delivered their
ll ll ll ll ll ll ll ll ll ll ll ll
acceptance to the seller.
ll ll ll ll
In the interim, the same buyers had found another house that they liked better and made
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
an offer on it, which was accepted. Which of the following is TRUE? - Correct Answers
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
Both contracts are valid
ll ll ll ll
Although states make specific laws governing water rights and the rights in land that
ll ll ll ll ll ll ll ll ll ll ll ll ll ll
borders water, most states
ll ll ll ll ll
generally follow one of two basic doctrines regarding water rights. In many states, the
ll ll ll ll ll ll ll ll ll ll ll ll ll
common law doctrine of riparian and littoral rights dictates that water rights are
ll ll ll ll ll ll ll ll ll ll ll ll ll
automatically conveyed with property. In others, all water rights are controlled by the state
ll ll ll ll ll ll ll ll ll ll ll ll ll ll
under the doctrine of - Correct Answers prior appropriation
ll ll ll ll ll ll ll ll ll ll ll ll
, The purpose of requiring an earnest money deposit in a real estate sales contract is to -
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
Correct Answers provide evidence of the buyer's intention to carry out the contract.
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
A buyer is getting a fully amortized loan for $220,000. The bank will give the buyer the loan
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
for 15 years at 5 1/2%
ll ll ll ll ll ll ll
or for 30 years at 6 1/2%. To the nearest cent, what is the difference between the monthly
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
payments for these two loans?
ll ll ll ll ll
(BE SURE TO USE THE AMORTIZATION TABLE.) - Correct Answers $409.20.
ll ll ll ll ll ll ll ll ll ll ll ll ll ll
A borrower has defaulted on the mortgage. The mortgage contains an acceleration
ll ll ll ll ll ll ll ll ll ll ll ll
clause. This permits the lender to - Correct Answers demand immediate payment of the
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
entire note
ll ll
ll The FHA functions MOST like - Correct Answers an insurance company
ll ll ll ll ll ll ll ll ll ll ll ll ll
1. They are used to buy down interest rate.
ll ll ll ll ll ll ll ll ll
2. They are a function of the marketplace.
ll ll ll ll ll ll ll
3. They are paid by either the buyer or the seller. - Correct Answers discount points
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
When land is conveyed to a trustee, the trustee may - Correct Answers do whatever is
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
permitted under the trust agreement
ll ll ll ll ll
A prospective buyer made an offer to purchase a property. The owner responded with a
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
counteroffer. While the buyer
ll ll ll ll ll
was reviewing the counteroffer, the owner received a better offer. The owner can accept
ll ll ll ll ll ll ll ll ll ll ll ll ll
the second offer if - Correct Answers the owner withdraws the counteroffer before it is
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
accepted.
ll
While an agent is showing a listed property, the seller and the buyer enter into an oral
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
agreement for the purchase of the home. If a dispute over the terms arises later, the
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
agreement may be unenforceable because - Correct Answers the agreement does not
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
comply with the Statute of Frauds
ll ll ll ll ll ll
Earnest money should be deposited into a trust account - Correct Answers in a timely
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
manner, according to state laws
ll ll ll ll ll
A deed restriction is applicable to the activities of - Correct Answers all owners, present
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
and future
ll ll
ll An easement can be terminated by - Correct Answers prescription
ll ll ll ll ll ll ll ll ll ll ll ll
ll Depreciation is calculated based on the - Correct Answers cost of the building only ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
Which of the following approaches MOST reliably estimates the sales price of a single-
ll ll ll ll ll ll ll ll ll ll ll ll ll ll
family residence? - Correct Answers Market data
ll ll ll ll ll ll ll ll ll
, A seller mentions to his agent that the previous owners of his property may have dumped
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
hazardous waste on the site. Under the Comprehensive Environmental Response,
ll ll ll ll ll ll ll ll ll ll
Compensation, and Liability Act (CERCLA), who is liable for damages from
ll ll ll ll ll ll ll ll ll ll ll
the dumping prior to the sale of the property? - Correct Answers Seller
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
The escrow officer or closing agent MUST give information regarding the sales price and
ll ll ll ll ll ll ll ll ll ll ll ll ll ll
seller's social security number to - Correct Answers IRS
ll ll ll ll ll ll ll ll ll ll ll ll
A broker supplies the financing for a project to build condominiums with the stipulation that
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
he has the exclusive right to sell the completed condos. Which of the following BEST
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
describes this relationship? - Correct Answers Agency coupled with an interest
ll ll ll ll ll ll ll ll ll ll ll ll ll ll
If you own a building free and clear that is worth $115,000 and want an annual return of
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
12%, what net income is needed each month? - Correct Answers $1,150
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
ll Usury laws were enacted to protect the - Correct Answers borrower
ll ll ll ll ll ll ll ll ll ll ll ll ll
At the time of listing, the seller tells the listing agent they are moving because the neighbor
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
has loud parties every weekend.
ll ll ll ll ll
The agent should - Correct Answers tell potential buyers about the parties
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
When one of the parties to an agreement fails to perform one of its conditions, that contract
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
is deemed to be - Correct Answers breached
ll ll ll ll ll ll ll ll ll ll ll
Which of the following is NOT a consideration in the definition of market value? - Correct
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
Answers Buyer and seller must agree to appraised value
ll ll ll ll ll ll ll ll ll ll ll
One common method for controlling the problems created by conflict of interest in dual
ll ll ll ll ll ll ll ll ll ll ll ll ll ll
representation is - Correct Answers allowing a broker to designate separate salespeople
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
within the company as legal representatives of each of the clients.
ll ll ll ll ll ll ll ll ll ll ll
Ownership of common stock in a corporation gives - Correct Answers an interest that is
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
classified as personal property
ll ll ll ll
At the closing on June 15, the buyer is assuming a mortgage presently on the property, on
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
which the monthly interest charge
ll ll ll ll ll
is currently $600. The seller has made the payment due on June 1. Assuming a VA
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
mortgage, what is the adjustment
ll ll ll ll ll ll
made at closing? - Correct Answers Debit seller $300; credit buyer $300
ll ll ll ll ll ll ll ll ll ll ll ll ll ll
ll Too much leverage may result in - Correct Answers negative cash flow
ll ll ll ll ll ll ll ll ll ll ll ll ll ll
A major reason for buying and owning a condominium rather than a detached single-family
ll ll ll ll ll ll ll ll ll ll ll ll ll ll
home is that - Correct Answers a condominium tends to be more affordable
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
, An adjustable rate loan should include all of the following elements - Correct Answers 1.
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
margin
ll
2. life-of-the-loan cap
ll ll
3. index ll
Regulation Z requires that the borrower be fully informed of all of the following - Correct
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
Answers 1. loan fees.
ll ll ll ll ll ll
2 .the origination fee.
ll ll ll
3. the annual percentage rate
ll ll ll ll
A couple signed a lease on an apartment for a period of 1 year. The lease does NOT
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
contain an automatic renewal clause. The couple plans to move out at the end of the lease
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
rather than renew it. How much notice MUST they give to comply with
ll ll ll ll ll ll ll ll ll ll ll ll ll ll
the lease term? - Correct Answers No notice is required
ll ll ll ll ll ll ll ll ll ll ll ll
The relationship in which the agent is placed in the position of trust and confidence to the
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
principal is known by the term - Correct Answers fiduciary
ll ll ll ll ll ll ll ll ll ll ll ll ll
A couple are moving to a new city. They have decided to rent temporarily before buying a
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
house to see which part of the city
ll ll ll ll ll ll ll ll ll
they would like to live in. What type of lease would BEST suit the couple's needs? - Correct
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
Answers Month-to-month lease
ll ll ll ll ll
A broker says, while showing a rural property, "This property has the world's purest well
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
water." This would be an example of - Correct Answers an expression of opinion, or
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
puffing, which could lead to misrepresentation
ll ll ll ll ll ll
A contract has been drawn which obliges the sellers to convey title to their land to the
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
buyers if the buyers come up with
ll ll ll ll ll ll ll ll
$22,000 on or before December 31st. This is called - Correct Answers an option contract
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
Errors and Omissions insurance covers the broker for - Correct Answers unintentional
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
misrepresentations
ll
The land description T3N, R4W Principal Meridian refers to what method of property
ll ll ll ll ll ll ll ll ll ll ll ll ll
description? - Correct Answers Rectangular survey.
ll ll ll ll ll ll ll ll ll
All of the following are methods to calculate the reproduction or replacement cost of a
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
building EXCEPT - Correct Answers straight-line method
ll ll ll ll ll ll ll ll ll ll
The buyer is assuming a mortgage presently on the property in the amount of $110,000.
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
What is the adjustment made at closing? - Correct Answers Credit buyer $110,000; debit
ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll ll
seller $110,000
ll ll
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller STUVATE. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $11.99. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
79976 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now