Real Estate Sales Exam Multiple Choice Questions 2 — Questions and Answers
Question 1: A buyer's agent has a fiduciary duty to act in whose best interest?
- The seller
- The buyer (Correct answer)
- The listing broker
- The state real estate commission
Correct answer: The buyer
A buyer's agent owes fiduciary duties—including loyalty and confidentiality—exclusively to the buyer.
Question 2: Which clause in a purchase contract allows the buyer to cancel if they cannot obtain financing?
- Acceleration clause
- Subordination clause
- Mortgage contingency clause (Correct answer)
- Alienation clause
Correct answer: Mortgage contingency clause
A mortgage contingency clause lets the buyer void the contract and recover their earnest money if they fail to secure a loan.
Question 3: Under the Truth in Lending Act (TILA), the Annual Percentage Rate (APR) must be disclosed within how many business days of a loan application?
- 1 day
- 3 days (Correct answer)
- 5 days
- 7 days
Correct answer: 3 days
TILA requires lenders to provide the APR disclosure within 3 business days of receiving a completed loan application.
Question 4: A property sold for $320,000 and the commission rate is 5.5%. The listing broker and selling broker split the commission equally. How much does each broker receive?
- $8,800 (Correct answer)
- $17,600
- $8,400
- $16,000
Correct answer: $8,800
$320,000 × 5.5% = $17,600 total commission; split equally = $8,800 each.
Question 5: Which type of easement is attached to the land and transfers automatically with the property?
- Easement in gross
- Easement appurtenant (Correct answer)
- License
- Encroachment
Correct answer: Easement appurtenant
An easement appurtenant runs with the land and automatically transfers to new owners when either parcel is sold.
Question 6: A licensee who practices real estate without a valid license is guilty of:
- A misdemeanor only in most states
- Practicing real estate illegally, which is a criminal offense in most states (Correct answer)
- A civil infraction with no criminal penalty
- Nothing, as long as no commission is collected
Correct answer: Practicing real estate illegally, which is a criminal offense in most states
Practicing real estate without a license violates state licensing laws and is a criminal offense—typically a misdemeanor or felony—in virtually all states.
Question 7: What is 'blockbusting' in real estate?
- Buying multiple foreclosed homes in one block
- Inducing homeowners to sell by suggesting minorities are moving into the neighborhood (Correct answer)
- Flipping properties quickly for profit
- Blocking a competitor's listings from the MLS
Correct answer: Inducing homeowners to sell by suggesting minorities are moving into the neighborhood
Blockbusting is an illegal practice under the Fair Housing Act where an agent induces panic selling by implying that the entry of a protected class will harm property values.
Real Estate Sales Exam Multiple Choice Questions 2
A buyer's agent has a fiduciary duty to act in whose best interest?