PSI Maryland Practice Exam COMPLETE QUESTIONS & ANSWERS(GRADED A)
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Course
Maryland real estate
Institution
Maryland Real Estate
If an older building cannot be air-conditioned, it is an example of ___________ ?
A. Economic obsolescence.
B. Functional obsolescence.
C. Physical deterioration.
D. External deterioration - ANSWER B. Functional obsolescence.
An appraiser MUST be licensed or certified to handle Federally r...
PSI Maryland Practice Exam COMPLETE
QUESTIONS & ANSWERS(GRADED A)
If an older building cannot be air-conditioned, it is an example of ___________ ?
A. Economic obsolescence.
B. Functional obsolescence.
C. Physical deterioration.
D. External deterioration - ANSWER B. Functional obsolescence.
An appraiser MUST be licensed or certified to handle Federally related work on residential property
valued at more than ___________?
A. $100,000.
B. $250,000.
C. $500,000.
D. $1,000,000. - ANSWER B. $250,000.
The main difference between tenancy in common and joint tenancy is that with tenancy in common,
when a co-owner dies, _____________
A. His undivided interest passes to his heirs.
B. The last surviving owner holds title in severalty.
C. His undivided interest passes to the surviving co-owners.
D. The principle of the right to survivorship determines the rights of the surviving co-owners. - ANSWER
A. His undivided interest passes to his heirs.
A buyer wants to purchase a home for $160,000 with a 15% down payment. The lender charges 2 points.
How much money does the buyer need up front to make the purchase?
, A. $2,720
B. $24,000
C. $24,408
D. $26,720 - ANSWER D. $26,720
When a home is purchased using an ARM, the monthly loan payment on the mortgage will
____________ ?
A. Rise slightly in each adjustment period until the cap is reached.
B. Be adjusted automatically to ensure that negative amortization does not occur.
C. Be based on a very low interest rate to begin with, but will rise to the market rate at the first
adjustment.
D. Vary over the life of the loan depending on fluctuations in the interest rate to which the loan is
referenced. - ANSWER D. Vary over the life of the loan depending on fluctuations in the interest rate to
which the loan is referenced.
An exception to title insurance coverage is ___________?
A. Forged documents.
B. Defects found in public newspapers.
C. Incorrect records of marital status.
D. Defects that clearly appear in the title search. - ANSWER D. Defects that clearly appear in the title
search.
Under the common law of agency, licensees owe the broker with whom they are associated all of the
following duties EXCEPT _________?
A. Loyalty.
B. Competence.
C. Indemnification.
, D. Full disclosure. - ANSWER C. Indemnification.
The buyer is assuming a mortgage presently on the property in the amount of $110,000. What is the
adjustment made at closing?
A. Credit buyer $110,000; debit seller $110,000.
B. Credit seller $110,000; debit buyer $110,000.
C. Credit buyer $110,000; no adjustment to seller.
D. Credit seller $110,000; no adjustment to buyer. - ANSWER A. Credit buyer $110,000; debit seller
$110,000.
A mentally disabled person who has been declared incompetent by a judge wishes to enter into a
contract. Under what conditions can such a person do so?
A. The person must obtain prior written approval by a licensed psychiatrist or psychologist.
B. The person must be capable of understanding the transaction.
C. The person appointed by the court to act for the disabled person must contract on his or her behalf.
D. The person may enter a contract under any conditions, because the law prohibits discrimination
against persons with disabilities. - ANSWER C. The person appointed by the court to act for the disabled
person must contract on his or her behalf.
The Civil Rights Act of 1866 prohibits any type of discrimination based on _________?
A. Gender.
B. Race.
C. Race and gender.
D. Religion. - ANSWER B. Race.
If a borrower can afford to make monthly principal and interest payments of $1,000 and the lender will
make a 30-year loan at 5-1/2%, or a 20-year loan at 4-1/2%, what is the largest loan (rounded to the
nearest $100) this buyer can afford? (BE SURE TO USE THE AMORTIZATION TABLE.)
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