Wisconsin Real Estate License Exam — Questions and Answers

Question 1: What is a Wisconsin licensee's obligation regarding multiple offers on the same property?

Present only the highest offer to the seller
Present all offers as soon as reasonably possible (Correct answer)
Advise competing buyers to increase their offers
Hold secondary offers until the first is rejected

Correct answer: Present all offers as soon as reasonably possible

Wisconsin law requires licensees to present all offers to the seller as soon as reasonably possible, regardless of other pending offers.

Question 2: A Wisconsin real estate agent privately believes that a neighborhood is declining and shares this opinion with a client to discourage them from purchasing there. If the opinion is based on the racial makeup of the area, what violation has occurred?

Permissible exercise of professional judgment
Illegal steering based on race (Correct answer)
No violation if the agent genuinely believes the opinion
A minor disclosure violation

Correct answer: Illegal steering based on race

Discouraging a purchase based on the racial composition of a neighborhood constitutes illegal racial steering regardless of the agent's personal beliefs.

Question 3: Federal law requires a Lead-Based Paint Disclosure for homes built before:

1985
1950
1978 (Correct answer)
1992

Correct answer: 1978

The disclosure applies to residential housing constructed before 1978.

Question 4: When must a Wisconsin real estate licensee provide a buyer with the approved Consumer Notice form?

Only if the buyer requests representation
After the offer has been accepted
At the first substantive contact with the buyer (Correct answer)
At the time of writing an offer

Correct answer: At the first substantive contact with the buyer

Wisconsin Administrative Code requires licensees to provide the Consumer Notice at the time of first substantive contact with a prospective buyer.

Question 5: Under Wisconsin law, what is the maximum amount of earnest money a broker can hold in their trust account without depositing it into an interest-bearing account?

There is no maximum; all earnest money must be deposited (Correct answer)
$5,000
$1,000
$25,000

Correct answer: There is no maximum; all earnest money must be deposited

Wisconsin law requires all earnest money to be deposited into the broker's trust account promptly, regardless of amount.

Question 6: How many years of active salesperson experience are typically required before qualifying for a broker license in Wisconsin?

10 years
No experience requirement is set by statute (Correct answer)
20 years
15 years

Correct answer: No experience requirement is set by statute

Wisconsin does not mandate a fixed number of years of salesperson experience to sit for the broker license, focusing on education and exams.

Question 7: An appraiser reconciles the three approaches to value by:

Using whichever the client prefers
Weighing them to form a final opinion of value (Correct answer)
Averaging them equally every time
Choosing only the lowest figure

Correct answer: Weighing them to form a final opinion of value

Reconciliation weighs each approach based on reliability to reach a final value opinion, not a simple average.

Question 8: Under Wisconsin's agency disclosure requirements, when must a licensee provide the agency disclosure form to a prospective buyer?

At the first substantive contact or before showing properties (Correct answer)
Only if the buyer requests it
At the time of closing
Within 5 days of first contact

Correct answer: At the first substantive contact or before showing properties

Wisconsin requires agency disclosure at the first substantive contact with a prospective buyer or before showing properties.

Question 9: In Wisconsin, which entity typically hears appeals of local zoning decisions?

The state Department of Administration
The Wisconsin Supreme Court
The Board of Zoning Appeals (BZA) (Correct answer)
The county sheriff's office

Correct answer: The Board of Zoning Appeals (BZA)

The Board of Zoning Appeals is established by municipalities to hear and decide appeals from zoning decisions, variance requests, and interpretations of the zoning ordinance.

Question 10: The Civil Rights Act of 1866 prohibits all racial discrimination in:

Only commercial property
Only federally funded housing
The sale or rental of all property with no exemptions (Correct answer)
Only rental housing

Correct answer: The sale or rental of all property with no exemptions

The 1866 Act bars all racial discrimination in property transactions and contains no exemptions.

Question 11: A tenant with a hearing impairment asks the landlord to communicate maintenance notices by text. Denying this reasonable request likely violates protection for:

Sex
Ancestry
Disability (Correct answer)
Age

Correct answer: Disability

Refusing an accommodation tied to a disability violates disability protection.

Question 12: The federal Fair Housing Act originated as which part of federal legislation?

The Sherman Act
Title VIII of the Civil Rights Act of 1968 (Correct answer)
Title VII of the Civil Rights Act of 1964
RESPA

Correct answer: Title VIII of the Civil Rights Act of 1968

The Fair Housing Act is Title VIII of the Civil Rights Act of 1968.

Question 13: What is the difference between reproduction cost and replacement cost in the cost approach to valuation?

Reproduction cost replicates the exact structure while replacement cost uses modern equivalents (Correct answer)
Both terms mean the same thing in appraisal practice
Replacement cost replicates the exact structure while reproduction cost uses modern equivalents
Reproduction cost only applies to commercial properties

Correct answer: Reproduction cost replicates the exact structure while replacement cost uses modern equivalents

Reproduction cost is the cost to build an exact replica of the structure using identical materials and methods, while replacement cost uses modern materials and techniques to build a structure of equal utility.

Question 14: Which pre-license course topic is specifically required by Wisconsin for salesperson candidates?

Wisconsin real estate law and practice (Correct answer)
International real estate transactions
Property management accounting
Commercial property investment

Correct answer: Wisconsin real estate law and practice

Wisconsin mandates coursework covering state-specific real estate law and practice as part of the 72-hour pre-license requirement.

Question 15: Under Wisconsin law, which type of deed provides the LEAST protection to the buyer?

Bargain and sale deed
General warranty deed
Quitclaim deed (Correct answer)
Special warranty deed

Correct answer: Quitclaim deed

A quitclaim deed transfers only whatever interest the grantor may have, with no warranties or guarantees of title.

Question 16: In Wisconsin, a subagent owes fiduciary duties to which party?

The seller through the listing broker (Correct answer)
The mortgage lender
The buyer who is shown the property
Both the buyer and seller equally

Correct answer: The seller through the listing broker

A subagent works through the listing broker and owes fiduciary duties to the seller.

Question 17: Marital status is a protected class in Wisconsin housing. Which action would violate this?

Requiring proof of income
Refusing to rent to an unmarried couple (Correct answer)
Requiring a security deposit
Running a background check

Correct answer: Refusing to rent to an unmarried couple

Denying housing because applicants are unmarried violates the marital status protection.

Question 18: If a HUD complaint is filed in Wisconsin, it may be referred to the state agency because Wisconsin's law is considered:

Purely voluntary
Substantially equivalent to federal law (Correct answer)
Weaker than federal law
Unenforceable

Correct answer: Substantially equivalent to federal law

Wisconsin is a substantially equivalent jurisdiction, so HUD can refer complaints to the state.

Question 19: What is an overlay district in Wisconsin land use planning?

A temporary construction zone designation
An additional set of regulations applied on top of existing base zoning (Correct answer)
A district that replaces all underlying zoning requirements
A federal designation that overrides state zoning

Correct answer: An additional set of regulations applied on top of existing base zoning

An overlay district imposes supplemental regulations on top of existing base zoning to address special concerns such as floodplains, historic preservation, or airport noise.

Question 20: Which statement in an ad would be considered legal and compliant?

'Two-bedroom apartment near public transit' (Correct answer)
'Adults preferred'
'No children allowed'
'Ideal for married couples'

Correct answer: 'Two-bedroom apartment near public transit'

Describing the property's features rather than the desired occupants is compliant.

Question 21: Which type of housing may qualify for an exemption from the familial status requirements?

Duplexes
Qualified housing for older persons (55+) (Correct answer)
Luxury apartments
Single-family homes

Correct answer: Qualified housing for older persons (55+)

Housing for older persons meeting the 55-or-older criteria is exempt from familial status rules.

Question 22: What is required for a valid real estate deed in Wisconsin?

Approval from the county assessor
Grantor signature, legal description, and delivery (Correct answer)
Witness signatures from two attorneys
Consideration, notarization, and recording

Correct answer: Grantor signature, legal description, and delivery

A valid deed in Wisconsin must include the grantor's signature, an adequate legal description of the property, and delivery to and acceptance by the grantee.

Question 23: Under Wisconsin law, which type of mortgage clause allows the lender to demand full repayment if the property is sold without lender approval?

Due-on-sale clause (Correct answer)
Prepayment penalty clause
Subordination clause
Defeasance clause

Correct answer: Due-on-sale clause

A due-on-sale clause, also called an alienation clause, lets the lender accelerate the loan balance upon transfer of the property.

Question 24: A key duty a Wisconsin licensee owes to ALL parties, clients and customers alike, is to:

Guarantee financing
Provide legal advice
Negotiate the lowest price
Disclose material adverse facts they know (Correct answer)

Correct answer: Disclose material adverse facts they know

Licensees must disclose material adverse facts to all parties regardless of who they represent.

Question 25: A licensee who fails to disclose a required agency relationship in Wisconsin may face:

Automatic license upgrade
No consequences
Only a client complaint letter
Disciplinary action by the licensing authority (Correct answer)

Correct answer: Disciplinary action by the licensing authority

Failing to make required agency disclosures can lead to disciplinary action against the license.

Question 26: If a Wisconsin licensee acts as a dual agent without obtaining written consent from both parties, what is the most likely consequence?

Both parties must renegotiate the purchase price
The transaction is valid but the agent receives a warning letter
The commission is automatically forfeited to the state
The licensee may face license suspension or revocation and the transaction may be voidable (Correct answer)

Correct answer: The licensee may face license suspension or revocation and the transaction may be voidable

Undisclosed dual agency violates Wisconsin law and can result in disciplinary action including license suspension or revocation, and the affected party may seek to void the transaction.

Question 27: What is the minimum age to obtain a Wisconsin real estate salesperson license?

21
16
25
18 (Correct answer)

Correct answer: 18

Applicants must be at least 18 years old to hold a Wisconsin salesperson license.

Question 28: A city planning commission is reviewing a new housing development proposal. To separate the proposed high-density residential area from an existing industrial park, the plan includes a park with extensive landscaping. This separating strip of land is best known as what?

A setback area
A buffer zone
A nonconforming use area (Correct answer)
An easement by necessity

Correct answer: A nonconforming use area

A buffer zone is a strip of land, often used for landscaping, parks, or open space, that is intentionally created to separate and screen one land use from another, such as separating a residential zone from a commercial or industrial zone, to minimize conflicts.

Question 29: Providing false information on a license application can result in:

An automatic broker upgrade
No consequences
Denial of the application or disciplinary action (Correct answer)
A shorter licensing period only

Correct answer: Denial of the application or disciplinary action

Falsifying application information can lead to denial, revocation, or other disciplinary action by DSPS.

Question 30: A dual-agency situation in Wisconsin most notably limits the licensee's ability to:

Fully advocate for one party over the other (Correct answer)
Disclose material defects
Collect a commission
Hold earnest money

Correct answer: Fully advocate for one party over the other

In multiple representation, the licensee cannot fully advocate for one party against the other.

Question 31: Points paid to a lender to reduce the interest rate are known as:

Discount points (Correct answer)
Prepayment penalties
Origination fees
Escrow deposits

Correct answer: Discount points

Discount points are prepaid interest paid at closing to buy down the loan's interest rate.

Question 32: Which government power allows Wisconsin to take private property for public use with just compensation?

Taxation
Escheat
Police power
Eminent domain (Correct answer)

Correct answer: Eminent domain

Eminent domain permits the government to condemn private property for public use, provided the owner receives just compensation.

Question 33: A couple is purchasing a home in Madison, Wisconsin, for $400,000. They are making a down payment of $80,000 and financing the rest. What is the loan-to-value (LTV) ratio for this transaction?

25%
20%
125%
80% (Correct answer)

Correct answer: 80%

The loan-to-value (LTV) ratio is calculated by dividing the loan amount by the property's value. In this scenario, the loan amount is the purchase price minus the down payment ($400,000 - $80,000 = $320,000). The LTV is calculated as $320,000 / $400,000, which equals 0.80 or 80%.

Question 34: A Wisconsin buyer's agent learns the seller must relocate quickly for a job. What should the agent do with this information?

Share it with the buyer client, as it may aid negotiation (Correct answer)
Disclose it to all future buyers
Report it to the DSPS
Keep it confidential from the buyer

Correct answer: Share it with the buyer client, as it may aid negotiation

A buyer's agent works in the buyer's interest and may use non-confidential, relevant information like a seller's motivation to benefit the client.

Question 35: Even where an exemption applies, which prohibition of the federal Fair Housing Act still always applies?

Rent control
The ban on discriminatory advertising (Correct answer)
The right to a mortgage
Property tax caps

Correct answer: The ban on discriminatory advertising

Discriminatory advertising is prohibited in all cases, regardless of other exemptions.

Question 36: Which Wisconsin statute grants extraterritorial plat review authority to cities and villages?

Wisconsin Statute 236 (Correct answer)
Wisconsin Statute 440
Wisconsin Statute 703
Wisconsin Statute 101

Correct answer: Wisconsin Statute 236

Wisconsin Statute 236 governs subdivision platting and grants cities and villages extraterritorial plat approval jurisdiction within a specified distance of their borders.

Question 37: Which practice violates Wisconsin advertising rules for licensees?

Including the firm's name in an ad
Advertising a property under the salesperson's name only without the broker (Correct answer)
Including a photo of the home
Listing the property price

Correct answer: Advertising a property under the salesperson's name only without the broker

Advertising must include the employing broker's firm name; a salesperson cannot advertise independently.

Question 38: A Wisconsin resident passes away, leaving a small estate consisting of a car, a bank account, and some personal belongings, with a total value of $45,000. The decedent had a simple will naming their child as the sole heir. What is the most likely method the heir will use to transfer this property?

A full probate court proceeding to validate the will.
Using a Transfer by Affidavit. (Correct answer)
Executing a new deed for the car and bank account.
Filing a lawsuit to quiet title on the assets.

Correct answer: Using a Transfer by Affidavit.

Wisconsin law provides a simplified procedure for small estates. When a decedent's probate assets are valued at $50,000 or less, an heir can use a 'Transfer by Affidavit' to collect the assets without going through the formal, time-consuming probate process.

Question 39: Under Wisconsin Administrative Code REEB 24, licensees owe certain duties to all parties in a transaction, clients and customers alike. Which of the following is a duty owed exclusively to a CLIENT?

To negotiate on the party's behalf, unless released from this duty. (Correct answer)
To safeguard trust funds and other property held by the firm.
To disclose all known material adverse facts in a timely manner.
To provide brokerage services fairly and honestly.

Correct answer: To negotiate on the party's behalf, unless released from this duty.

While all parties are owed fair and honest treatment, disclosure of material adverse facts, and safeguarding of funds, the duty to negotiate on behalf of a party is a specific fiduciary duty reserved for clients with whom the firm has a written agency agreement (e.g., a listing contract or buyer agency agreement). Agents may not negotiate for a customer unless they become a client.

Question 40: A buyer includes an inspection contingency in their WB-11 Residential Offer to Purchase. The inspection report reveals a 'Defect' as defined in the offer. The buyer wants to ask the seller to make repairs. What is the buyer's next step according to the standard contingency language?

Send the seller the full inspection report with a verbal request for repairs.
Immediately terminate the offer.
Send a Notice of Defects to the seller, which automatically terminates the offer.
Provide the seller with a WB-40 Amendment to Offer to Purchase proposing the repairs. (Correct answer)

Correct answer: Provide the seller with a WB-40 Amendment to Offer to Purchase proposing the repairs.

While a buyer has the right to provide a Notice of Defects which can terminate the offer, if the goal is to negotiate repairs, the proper procedure is to propose a WB-40 Amendment to the seller. The WB-11 explicitly states that a proposed amendment is NOT a Notice of Defects. The parties must mutually agree to the amendment to change the terms of the accepted offer.

Question 41: An investment property generates $36,000 in annual net operating income and is valued at $400,000. What is the capitalization rate?

9% (Correct answer)
11%
8%
10%

Correct answer: 9%

Cap rate = NOI ÷ value: $36,000 ÷ $400,000 = 0.09 or 9%.

Question 42: Which Wisconsin statute governs the formal requirements for transferring real property?

Wisconsin Fair Dealership Law
Wisconsin Consumer Act
Statute of Frauds (Correct answer)
Uniform Commercial Code

Correct answer: Statute of Frauds

The Statute of Frauds requires real property transfers to be in writing and signed by the party to be charged.

Question 43: Under Wisconsin's agency law, which type of agency allows a broker to represent both the buyer and seller in the same transaction?

Dual agency with informed consent (Correct answer)
Implied agency
Designated agency
Single agency

Correct answer: Dual agency with informed consent

Dual agency is permitted in Wisconsin only when both parties give informed written consent.

Question 44: The Wisconsin Real Estate Examining Board is responsible for:

Setting mortgage interest rates
Collecting property taxes
Approving home loans
Establishing licensing standards and disciplinary rules for licensees (Correct answer)

Correct answer: Establishing licensing standards and disciplinary rules for licensees

The Real Estate Examining Board sets licensing standards and handles disciplinary matters for licensees.

Question 45: Which of the following is a legitimate, non-discriminatory reason to reject a rental applicant in Wisconsin?

The applicant's sexual orientation
The applicant's national origin
Insufficient verifiable income to afford the rent (Correct answer)
The applicant having children

Correct answer: Insufficient verifiable income to afford the rent

Inability to afford the rent is a lawful, non-discriminatory basis for denial.

Question 46: In Wisconsin, a licensee working with a buyer who has NOT signed a buyer agency agreement generally treats that buyer as a:

Fiduciary
Principal
Customer (Correct answer)
Client

Correct answer: Customer

Without a written agency agreement, the buyer is a customer to whom the licensee owes fair and honest dealing but not full client-level duties.

Question 47: A Wisconsin borrower who defaults on a mortgage may lose the property through a court-supervised process called:

Judicial foreclosure (Correct answer)
Partition
Escheat
Novation

Correct answer: Judicial foreclosure

Wisconsin primarily uses judicial foreclosure, requiring the lender to obtain a court judgment before selling the property.

Question 48: Within how many years of lapsing may a Wisconsin real estate license be reinstated without retaking the licensing exam?

2 years
10 years
5 years (Correct answer)
1 year

Correct answer: 5 years

Wisconsin allows a lapsed license to be reinstated within 5 years of the lapse date without requiring the licensee to retake the licensing examination.

Question 49: What is the primary purpose of recording a deed with the Wisconsin Register of Deeds?

To provide constructive notice to the public of the ownership change (Correct answer)
To satisfy federal tax reporting requirements
To make the transfer legally valid between buyer and seller
To activate the buyer's homestead exemption

Correct answer: To provide constructive notice to the public of the ownership change

Recording provides constructive notice to the world that a property transfer has occurred, protecting the new owner against subsequent claims.

Question 50: In Wisconsin, a listing broker who cooperates with a buyer's broker through the MLS is generally offering what type of relationship to the buyer's broker?

Cooperative compensation without subagency (Correct answer)
Subagency
Dual agency
Automatic fiduciary representation

Correct answer: Cooperative compensation without subagency

Modern MLS practice in Wisconsin typically offers cooperative compensation to a buyer's broker without creating a subagency relationship.

Question 51: A Wisconsin licensee terminates an agency agreement but later receives a call from the former client requesting confidential info be revealed to a new buyer. The licensee must:

Charge a fee to keep it private
Report the request to the buyer
Reveal it since the agency ended
Continue protecting the former client's confidential information (Correct answer)

Correct answer: Continue protecting the former client's confidential information

Confidentiality survives termination of the agency, so the licensee must continue to protect the former client's confidential information.

Question 52: In Wisconsin, the WB-44 Counter-Proposal form is used when a seller wants to change terms of a buyer's offer. What happens to the original offer when a counter-proposal is issued?

The original offer must be returned to the buyer unsigned
The original offer remains valid alongside the counter
The original offer is suspended for 72 hours
The original offer is rejected and a new proposal is created (Correct answer)

Correct answer: The original offer is rejected and a new proposal is created

Issuing a WB-44 Counter-Proposal constitutes a rejection of the original offer and creates a new proposal with modified terms.

Question 53: In a Wisconsin transaction, what is the function of a deed?

To list the property for sale
To transfer legal title to real property from grantor to grantee (Correct answer)
To secure a loan against the property
To disclose property defects

Correct answer: To transfer legal title to real property from grantor to grantee

A deed is the legal instrument that conveys ownership of real property from the grantor to the grantee.

Question 54: Which document is used in Wisconsin to transfer real property ownership at a tax foreclosure sale?

Trustee's deed
Executor's deed
Tax deed (Correct answer)
Sheriff's deed

Correct answer: Tax deed

A tax deed is issued by the county to convey property acquired through tax foreclosure proceedings in Wisconsin.

Question 55: A Wisconsin real estate licensee discovers that a property they listed has a known defect that the seller refused to disclose. What is the licensee's legal obligation?

Report the seller to the Wisconsin DSPS
Withdraw from the listing without explanation
Keep the information confidential as required by agency duties
Disclose the defect to prospective buyers regardless of the seller's wishes (Correct answer)

Correct answer: Disclose the defect to prospective buyers regardless of the seller's wishes

Wisconsin's Real Estate Condition Report requirements and licensee duties mandate disclosure of known material defects to buyers, even if the seller objects.

Question 56: A mortgage in which each payment covers both principal and interest, fully repaying the loan by the end, is called:

An amortized loan (Correct answer)
A balloon loan
An interest-only loan
A term loan

Correct answer: An amortized loan

An amortized loan pays off both principal and interest gradually so the balance is zero at maturity.

Question 57: A Wisconsin firm practicing designated agency must ensure that:

Each designated agent protects the confidential information of their own party (Correct answer)
The broker personally negotiates for both sides
Both agents share all confidential information
The parties waive all duties

Correct answer: Each designated agent protects the confidential information of their own party

Under designated agency, each appointed agent owes full duties to their assigned party, including confidentiality.

Question 58: A Wisconsin licensee is representing a seller but personally wants to buy the property. What must occur?

Written disclosure of the licensee's status and interest to the seller (Correct answer)
Another agent must take over silently
Nothing, agents can buy listings freely
The listing must be canceled

Correct answer: Written disclosure of the licensee's status and interest to the seller

A licensee buying a client's property must disclose their licensee status and personal interest in writing.

Question 59: Which type of property ownership allows multiple owners with an undivided interest in the property?

Life estate
Joint tenancy with right of survivorship
Tenancy in common (Correct answer)
Fee simple absolute

Correct answer: Tenancy in common

Tenancy in common is a type of property ownership that allows multiple owners to hold an undivided interest in the property. This means each owner has a distinct, proportionate share of the entire property, but not a specific physical portion. Unlike joint tenancy, there is no right of survivorship, allowing each co-owner to sell or will their share independently.

Question 60: Blockbusting involves:

Inducing panic selling by suggesting a protected group is moving in (Correct answer)
Setting occupancy limits
Advertising only in one language
Refusing loans in certain areas

Correct answer: Inducing panic selling by suggesting a protected group is moving in

Blockbusting is illegally prompting owners to sell by claiming a protected group is entering the neighborhood.

Question 61: What is the statute of limitations for adverse possession claims in Wisconsin?

30 years
10 years
5 years
20 years (Correct answer)

Correct answer: 20 years

Wisconsin requires continuous, open, notorious, hostile, and exclusive possession for 20 years to establish an adverse possession claim.

Question 62: The secondary mortgage market primarily serves to:

Buy loans from lenders to provide liquidity (Correct answer)
Originate loans directly to buyers
Appraise residential properties
Set federal interest rates

Correct answer: Buy loans from lenders to provide liquidity

The secondary market buys existing loans from originators, giving lenders funds to make more loans.

Question 63: A real estate agent attempts to solicit listings in a neighborhood by telling homeowners that people of a certain protected class are moving in and that property values will decline as a result. This illegal and discriminatory practice is known as:

Redlining
Canvassing
Steering
Blockbusting (Correct answer)

Correct answer: Blockbusting

Blockbusting, also known as panic selling, is the illegal practice of inducing homeowners to sell their properties by making representations regarding the entry or prospective entry of persons of a particular protected class into the neighborhood. This fear-mongering tactic is a violation of the Fair Housing Act.

Question 64: What must a Wisconsin property owner demonstrate to obtain a use variance from the local zoning board?

That neighbors support the requested change
Financial inconvenience from current zoning
That the property was recently purchased
Unnecessary hardship unique to the property (Correct answer)

Correct answer: Unnecessary hardship unique to the property

Wisconsin law requires a property owner to prove unnecessary hardship that is unique to the property, not self-created, in order to obtain a use variance.

Question 65: A licensee knowingly conceals a past basement flooding problem from buyers. This is:

Confidential client information
Fraudulent concealment of a material adverse fact (Correct answer)
Legal puffing
Acceptable if not asked

Correct answer: Fraudulent concealment of a material adverse fact

Knowingly hiding a material defect like recurring flooding is fraudulent concealment.

Question 66: A clause allowing the lender to demand full payment if the property is sold is known as a:

Prepayment clause
Due-on-sale (alienation) clause (Correct answer)
Defeasance clause
Acceleration clause

Correct answer: Due-on-sale (alienation) clause

A due-on-sale or alienation clause lets the lender call the loan due when the property is transferred.

Question 67: Under Wisconsin law, what happens to a legally nonconforming use if it is abandoned for 12 months?

The municipality must compensate the owner
The nonconforming use is typically lost and the property must conform to current zoning (Correct answer)
The owner receives automatic rezoning approval
The use is automatically renewed for another 12 months

Correct answer: The nonconforming use is typically lost and the property must conform to current zoning

Wisconsin municipalities generally provide that a nonconforming use that has been discontinued or abandoned for 12 consecutive months cannot be resumed.

Question 68: A property's assessed value is $180,000 and the mill rate is 20 mills. What is the annual property tax?

$3,600 (Correct answer)
$36,000
$18,000
$1,800

Correct answer: $3,600

20 mills = $20 per $1,000; $180,000 ÷ 1,000 × 20 = $3,600 annual property tax.

Question 69: Annual property taxes are $4,800. The closing occurs on April 1. The seller has not yet paid any taxes for the year. Using a 360-day year, how much does the seller owe the buyer at closing?

$1,600
$1,200 (Correct answer)
$2,400
$3,600

Correct answer: $1,200

Jan 1 to April 1 = 90 days; daily rate = $4,800 ÷ 360 = $13.33; 90 × $13.33 = $1,200.

Question 70: Under Wisconsin's Marital Property Act, how is property acquired during marriage generally classified?

Marital property (Correct answer)
Separate property
Community property
Joint tenancy property

Correct answer: Marital property

Wisconsin is one of few states following a marital property system where assets acquired during marriage are presumed to be marital property, shared equally between spouses.

Question 71: Commingling, an ethics and license-law violation, means:

Mixing client trust funds with the broker's own funds (Correct answer)
Representing two clients
Sharing commission with a cooperating broker
Advertising in multiple markets

Correct answer: Mixing client trust funds with the broker's own funds

Commingling is improperly mixing client trust funds with the broker's personal or business funds.

Question 72: The Wisconsin Open Housing Law is codified in which section of the state statutes?

Wis. Stat. 106.50 (Correct answer)
Wis. Stat. 452.14
Wis. Stat. 704.05
Wis. Stat. 100.20

Correct answer: Wis. Stat. 106.50

Wisconsin's fair housing protections are found in Wis. Stat. 106.50, the Open Housing Law.

Question 73: In Wisconsin, when must a licensee provide the 'Disclosure to Customers' form to a potential buyer who is not represented by an agent?

Prior to or at the time of the first property showing.
Before negotiating on behalf of the customer. (Correct answer)
At the time an offer to purchase is drafted.
Only after the buyer has expressed a serious interest in a specific property.

Correct answer: Before negotiating on behalf of the customer.

Wisconsin law, specifically Wis. Stat. § 452.135, requires that a licensee provide the 'Disclosure to Customers' form prior to negotiating on behalf of that customer. This disclosure clarifies that the licensee is not representing the customer as a client and outlines the duties owed to them. While it's good practice to provide it early, the legal trigger is before beginning negotiations.

Question 74: Which of the following best describes a nonconforming use in Wisconsin?

A use that requires a special exception from the zoning board
A use that has never been permitted under any zoning classification
A use that is allowed only in commercial districts
A use that violates the current zoning but was lawful before the zoning change (Correct answer)

Correct answer: A use that violates the current zoning but was lawful before the zoning change

A nonconforming use is one that legally existed before a zoning ordinance was enacted or amended and does not comply with current zoning requirements.

Question 75: Which document is commonly required to verify an applicant's identity during licensing?

A passport from any country without ID
A library card
A government-issued photo ID / Social Security number (Correct answer)
A utility bill only

Correct answer: A government-issued photo ID / Social Security number

Applicants typically must provide a valid government-issued ID and Social Security number for identity verification.

Question 76: In a Wisconsin land contract (contract for deed), who holds legal title to the property during the contract period?

The seller retains legal title until the contract is fulfilled (Correct answer)
The county register of deeds holds title
Title is held in escrow by a neutral third party
The buyer holds legal title immediately

Correct answer: The seller retains legal title until the contract is fulfilled

In a Wisconsin land contract, the seller retains legal title while the buyer receives equitable title until all payments are made.

Question 77: The Wisconsin redemption period gives a defaulting borrower the right to:

Waive property taxes
Transfer the mortgage to a new buyer
Refuse the appraisal
Pay the debt and reclaim the property before the sale (Correct answer)

Correct answer: Pay the debt and reclaim the property before the sale

Wisconsin law grants borrowers a redemption period to cure the default by paying the amount owed before the foreclosure sale is confirmed.

Question 78: A house has a replacement cost of $280,000 and has depreciated 15%. The land is valued at $50,000. Using the cost approach, what is the estimated property value?

$330,000
$288,000 (Correct answer)
$238,000
$280,000

Correct answer: $288,000

Depreciated building value = $280,000 × 0.85 = $238,000; add land: $238,000 + $50,000 = $288,000.

Question 79: What is the purpose of a conditional use permit (CUP) in Wisconsin zoning?

To allow a use not otherwise permitted in the zoning district under specific conditions (Correct answer)
To transfer development rights to another parcel
To exempt a property from all building codes
To permanently change a property's zoning classification

Correct answer: To allow a use not otherwise permitted in the zoning district under specific conditions

A conditional use permit allows a land use that is not permitted by right in a zoning district but may be allowed if certain conditions imposed by the local authority are met.

Question 80: Under Wisconsin law, how must amendments to the earnest money amount in an accepted offer be documented?

Verbal agreement between agents is sufficient
Using the WB-40 Amendment to Offer signed by all parties (Correct answer)
A text message between parties is acceptable
No documentation is required for earnest money changes

Correct answer: Using the WB-40 Amendment to Offer signed by all parties

Any change to earnest money in an accepted offer must be documented using the WB-40 Amendment form signed by all parties to be enforceable.

Question 81: When a Wisconsin salesperson changes their employing broker, how many days do they have to notify DSPS?

5 days
30 days
60 days
10 days (Correct answer)

Correct answer: 10 days

Wisconsin licensees must notify DSPS within 10 days of changing their employing broker to keep licensing records current.

Question 82: In Wisconsin, before land can be subdivided into multiple lots for sale, the developer usually must record a:

Deed of trust
Land contract
Title abstract
Certified survey map or plat (Correct answer)

Correct answer: Certified survey map or plat

Wisconsin subdivision law requires recording a plat or certified survey map to legally divide land into parcels.

Question 83: A seller who finances the buyer's purchase directly by taking back a note is providing a:

Reverse mortgage
Package mortgage
Purchase-money mortgage (Correct answer)
Wraparound bridge loan

Correct answer: Purchase-money mortgage

A purchase-money mortgage is seller financing where the seller extends credit to the buyer.

Question 84: A remedy the Wisconsin Equal Rights Division may order after finding discrimination includes:

Criminal imprisonment
License suspension only
Actual damages and a civil penalty (Correct answer)
No remedy is available

Correct answer: Actual damages and a civil penalty

The Division can award actual damages and impose civil penalties for violations.

Question 85: Which of the following activities requires a Wisconsin real estate license?

Negotiating the sale of real property for another person for compensation (Correct answer)
Managing your own rental properties
Referring a friend to a licensed agent with no compensation received
Selling your own personal residence

Correct answer: Negotiating the sale of real property for another person for compensation

Acting on behalf of another person to negotiate a real estate transaction in exchange for compensation requires a Wisconsin real estate license.

Question 86: Which document in a Wisconsin transaction primarily discloses known property defects from the seller?

Real Estate Condition Report (Correct answer)
Closing Disclosure
Buyer agency agreement
Agency disclosure statement

Correct answer: Real Estate Condition Report

The Real Estate Condition Report is the seller's disclosure of known conditions and defects of the property.

Question 87: Which federal law requires lenders to disclose the annual percentage rate (APR) to borrowers?

ECOA
Truth in Lending Act (Correct answer)
RESPA
Fair Housing Act

Correct answer: Truth in Lending Act

The Truth in Lending Act (Regulation Z) requires disclosure of the APR and total finance charges.

Question 88: Which Wisconsin document must a seller of residential property with 1-4 dwelling units generally provide to a buyer?

The Real Estate Condition Report (Correct answer)
A power of attorney
A title insurance binder
A quitclaim deed

Correct answer: The Real Estate Condition Report

Wisconsin law requires most sellers of 1-4 unit residential property to furnish a Real Estate Condition Report disclosing known defects.

Question 89: Which of the following best describes the concept of 'negligent misrepresentation' in Wisconsin real estate practice?

Making a false statement about a property without exercising reasonable care to verify its accuracy (Correct answer)
Intentionally lying about a property's condition to induce a sale
Failing to return phone calls from prospective buyers in a timely manner
Accidentally using an outdated listing photo in marketing materials

Correct answer: Making a false statement about a property without exercising reasonable care to verify its accuracy

Negligent misrepresentation occurs when a licensee makes inaccurate statements without taking reasonable steps to verify the information, even without intent to deceive.

Question 90: If a Wisconsin client refuses to authorize multiple representation, the firm must:

Represent both parties anyway
Terminate the client without notice
Not proceed with representing both parties in that transaction (Correct answer)
Disclose the client's confidential information

Correct answer: Not proceed with representing both parties in that transaction

Multiple representation requires the informed written consent of the parties; without it the firm cannot represent both.

Question 91: PMI (private mortgage insurance) is typically required when a conventional loan's down payment is:

More than 20%
Any amount
Exactly 50%
Less than 20% (Correct answer)

Correct answer: Less than 20%

PMI is generally required on conventional loans when the borrower puts down less than 20%.

Question 92: The four essential elements of value are demand, utility, scarcity, and:

Financing
Depreciation
Location
Transferability (Correct answer)

Correct answer: Transferability

The four elements of value (DUST) are demand, utility, scarcity, and transferability.

Question 93: What is the primary purpose of the WB-36 Buyer Agency/Tenant Representation Agreement in Wisconsin?

To establish exclusive buyer agency representation (Correct answer)
To disclose dual agency to the buyer
To terminate a listing agreement
To authorize a licensee to show properties only

Correct answer: To establish exclusive buyer agency representation

The WB-36 establishes the terms of exclusive buyer agency representation between the buyer and the brokerage firm.

Question 94: A Wisconsin firm representing both the buyer and seller in the same transaction is engaging in what practice?

Multiple representation (dual agency) (Correct answer)
Designated agency
Single agency
Subagency

Correct answer: Multiple representation (dual agency)

When one firm represents both parties in a transaction it is providing multiple representation, which requires written consent.

Question 95: How many continuing education (CE) hours must a Wisconsin real estate licensee complete each 2-year renewal period?

12 hours
30 hours
24 hours
18 hours (Correct answer)

Correct answer: 18 hours

Wisconsin real estate licensees are required to complete 18 hours of DSPS-approved continuing education during each biennial renewal cycle.

Question 96: Which factor would MOST likely decrease a property's market value?

Being in a top-rated school district
A new roof
Proximity to a newly built landfill (Correct answer)
A remodeled kitchen

Correct answer: Proximity to a newly built landfill

A nearby landfill is external obsolescence that typically reduces market value.

Question 97: In Wisconsin, when must a broker deliver the accepted offer to purchase to all parties?

Within one business day of acceptance (Correct answer)
Within 48 hours
Immediately upon acceptance
Within 24 hours

Correct answer: Within one business day of acceptance

Wisconsin administrative code requires brokers to deliver copies of the accepted offer to all parties within one business day of acceptance.

Question 98: In the sales comparison approach, adjustments are always made to which property?

Both equally
The comparable properties (Correct answer)
Whichever sold most recently
The subject property

Correct answer: The comparable properties

Adjustments are made to the comparable sales, never to the subject property, to make them equivalent to the subject.

Question 99: When an assessor in Wisconsin is determining the value of a property for tax purposes, which of the following is considered the BEST evidence of the property's value according to state guidelines?

A recent, arm's-length sale of the property itself. (Correct answer)
The average sale price of homes in the same zip code.
The cost to replace the structure, minus depreciation.
The property's potential to generate rental income.

Correct answer: A recent, arm's-length sale of the property itself.

Wisconsin statutes and the Wisconsin Property Assessment Manual state that a recent, arm's-length sale of the subject property is the best indicator of its full market value. If such a sale hasn't occurred, the next best information is recent arm's-length sales of reasonably comparable properties. Other methods are used only when sales data is insufficient.

Question 100: A Wisconsin seller's agent receives two offers simultaneously. Which practice aligns with the agent's ethical and legal duties?

Advise the seller to reject the lower offer before formally presenting it
Hold the lower offer until the seller responds to the higher one
Present both offers promptly and let the seller decide without the agent's bias (Correct answer)
Present the higher offer first to save the seller time

Correct answer: Present both offers promptly and let the seller decide without the agent's bias

Wisconsin licensees must present all offers promptly and fairly, allowing the seller to make an informed decision without the agent filtering or prioritizing.

Question 101: What is the minimum age required to obtain a Wisconsin real estate salesperson license?

25 years old
16 years old
18 years old (Correct answer)
21 years old

Correct answer: 18 years old

Wisconsin law requires all real estate salesperson applicants to be at least 18 years of age.

Question 102: A property generates $48,000 in annual net operating income and has a capitalization rate of 8%. What is the estimated property value using the income approach?

$384,000
$576,000
$480,000
$600,000 (Correct answer)

Correct answer: $600,000

Using the income approach formula, value equals net operating income divided by the cap rate: $48,000 ÷ 0.08 = $600,000.

Question 103: A salesperson's license is tied to their employing broker, meaning if the broker relationship ends the salesperson:

Keeps practicing freely
Automatically loses the license permanently
Must not conduct real estate activity until associated with a new broker (Correct answer)
Becomes a broker automatically

Correct answer: Must not conduct real estate activity until associated with a new broker

A salesperson cannot conduct licensed activity without being associated with a supervising broker.

Question 104: In Wisconsin, which offer-to-purchase provision automatically makes an accepted offer contingent on the buyer securing a mortgage?

The financing contingency in the WB-11 Residential Offer to Purchase (Correct answer)
The default earnest money clause
The listing contract
The seller's disclosure report

Correct answer: The financing contingency in the WB-11 Residential Offer to Purchase

The WB-11 Residential Offer to Purchase includes a financing contingency that conditions the sale on the buyer obtaining loan approval.

Question 105: An advertisement stating 'perfect for a Christian family' most likely violates fair housing on the basis of:

Sex and age
Religion and familial status (Correct answer)
Disability
Race and color

Correct answer: Religion and familial status

Referencing religion and family type in an ad indicates a discriminatory preference.

Question 106: Which appraisal approach is most suitable and heavily relied upon for valuing a 15-year-old single-family residence located in a well-established residential subdivision in Wisconsin?

Income Approach
Gross Rent Multiplier Method
Cost Approach
Sales Comparison Approach (Correct answer)

Correct answer: Sales Comparison Approach

The Sales Comparison Approach is the most reliable and common method for appraising residential properties, especially in areas with ample sales data. This approach is based on the principle of substitution, comparing the subject property to similar, recently sold properties to determine its value. The Cost Approach is better for new or unique properties, and the Income Approach is used for income-generating properties.

Question 107: A Wisconsin broker who follows a client's lawful instructions even when the broker disagrees is fulfilling which duty?

Confidentiality
Obedience (Correct answer)
Accounting
Disclosure

Correct answer: Obedience

The duty of obedience requires a licensee to follow the client's lawful and reasonable instructions.

Question 108: Under Wisconsin law, a licensee who is convicted of a felony must:

Report it to the licensing authority as required (Correct answer)
Do nothing unless caught
Wait until license renewal to mention it
Only tell their broker

Correct answer: Report it to the licensing authority as required

Licensees must report certain criminal convictions to the licensing authority as required by law.

Question 109: A listing agent is holding an open house for their seller client. A prospective buyer attends, is not represented by an agent, and expresses interest in the property. The buyer asks the listing agent about a faint water stain on the ceiling of a closet. The agent knows the seller repaired a minor roof leak last year. According to Wisconsin law, how must the agent respond?

Inform the buyer that because the leak was repaired, it is no longer a disclosable issue.
Disclose the known information about the past leak and subsequent repair, as it is a material adverse fact. (Correct answer)
Advise the buyer that all property condition issues are addressed in the Real Estate Condition Report and that the agent cannot comment further.
Tell the buyer they must hire their own agent to get information about the property's condition.

Correct answer: Disclose the known information about the past leak and subsequent repair, as it is a material adverse fact.

Wisconsin Administrative Code REEB 24.07 requires licensees to disclose all known material adverse facts to all parties in writing and in a timely fashion. A past leak, even if repaired, is considered a material adverse fact about the property's history that a buyer would want to know. The agent's duty to disclose known material adverse facts overrides any duty of confidentiality to the seller on this specific matter.

Question 110: A property manager applies a stricter income requirement only to applicants from a certain national origin. This is:

A legal business decision
A permitted occupancy standard
Reasonable accommodation
Disparate treatment discrimination (Correct answer)

Correct answer: Disparate treatment discrimination

Applying different standards to a protected group is illegal disparate treatment.

Question 111: A Wisconsin licensee wants to place a sign on a listed property. Ethically and legally, they must first obtain:

The seller/owner's permission (Correct answer)
City council approval
MLS approval
Buyer consent

Correct answer: The seller/owner's permission

A licensee must have the owner's permission before placing a sign on the property.

Question 112: In Wisconsin, a counter-offer by the seller has what legal effect on the buyer's original offer?

It voids the earnest money
It automatically accepts the original offer
It rejects the original offer and creates a new offer (Correct answer)
It has no legal effect until closing

Correct answer: It rejects the original offer and creates a new offer

A counter-offer terminates the original offer and constitutes a new offer that the other party may accept or reject.

Question 113: The Wisconsin Real Estate Condition Report (RECR) is generally completed by the:

Seller/owner (Correct answer)
Home inspector
Buyer
Listing broker

Correct answer: Seller/owner

The owner completes the RECR based on their knowledge of the property's condition.

Question 114: Wisconsin follows which theory regarding mortgages, meaning the borrower retains title while the lender holds a lien?

Intermediate theory
Lien theory (Correct answer)
Trust theory
Title theory

Correct answer: Lien theory

Wisconsin is a lien theory state, so the borrower keeps title and the lender holds only a lien until the debt is paid.

Question 115: A key advantage of an FHA-insured loan for buyers is:

No mortgage insurance
Guaranteed 0% interest
A lower required down payment (Correct answer)
No credit check

Correct answer: A lower required down payment

FHA loans allow low down payments (as little as 3.5%), making homeownership more accessible.

Question 116: A dual agent in Wisconsin must:

Refuse commission
Favor the buyer
Disclose each party's confidential information
Obtain informed consent from both parties and remain neutral (Correct answer)

Correct answer: Obtain informed consent from both parties and remain neutral

A dual agent must have both parties' informed consent and treat them impartially without disclosing confidences.

Question 117: Is a high school diploma explicitly required to obtain a Wisconsin salesperson license?

Only a college degree qualifies
No specific diploma requirement, but pre-licensing education is required (Correct answer)
Yes, a diploma or GED is mandatory
A trade certificate is required

Correct answer: No specific diploma requirement, but pre-licensing education is required

Wisconsin does not mandate a high school diploma, but the 72-hour pre-licensing course must be completed.

Question 118: A property was purchased for $200,000 and sold three years later for $230,000. What is the total percentage appreciation?

20%
15% (Correct answer)
10%
13%

Correct answer: 15%

Appreciation = ($230,000 − $200,000) ÷ $200,000 = $30,000 ÷ $200,000 = 15%.

Question 119: Which type of loan allows a Wisconsin borrower to draw funds as needed up to a set limit, using the home as collateral?

Fixed-rate mortgage
Balloon mortgage
Blanket mortgage
Home equity line of credit (HELOC) (Correct answer)

Correct answer: Home equity line of credit (HELOC)

A HELOC functions as a revolving credit line secured by the borrower's home equity, allowing withdrawals up to an approved limit.

Question 120: A homeowner in Madison, Wisconsin wants to build a garage that will encroach 5 feet into the side-yard setback required by the local zoning ordinance. The homeowner can demonstrate that the odd shape of their lot creates a unique hardship not caused by their own actions. What should the homeowner apply for?

A spot zoning grant, to have their property uniquely rezoned.
A zoning amendment, to change the rules for the entire neighborhood.
A conditional use permit, because the use is not normally allowed.
An area variance, to get an exception from a physical dimension rule. (Correct answer)

Correct answer: An area variance, to get an exception from a physical dimension rule.

A variance is used when a property owner requests an exception to a physical requirement in a zoning ordinance, such as a setback. An 'area variance' specifically relates to dimensional requirements like setbacks, height, or lot coverage, and is granted when a hardship not created by the owner is proven.

Question 121: What type of loan has an interest rate that changes periodically based on an index?

Fixed-rate mortgage
Purchase-money mortgage
Adjustable-rate mortgage (Correct answer)
Fully amortized fixed loan

Correct answer: Adjustable-rate mortgage

An adjustable-rate mortgage (ARM) has a rate that adjusts periodically according to a market index.

Question 122: Which of the following best describes tenancy by the entirety in Wisconsin?

Ownership by two or more unrelated individuals
Ownership by a business partnership
Ownership held in a living trust
Ownership by a married couple with right of survivorship (Correct answer)

Correct answer: Ownership by a married couple with right of survivorship

Tenancy by the entirety is a form of co-ownership available only to married couples in Wisconsin, featuring an automatic right of survivorship.

Question 123: What does Wisconsin's 'right of first refusal' law allow a municipality to do regarding tax-delinquent properties?

Seize the property immediately
Purchase the property before it goes to public auction (Correct answer)
Demolish the property without notice
Transfer it to a private developer

Correct answer: Purchase the property before it goes to public auction

Wisconsin law grants municipalities a right of first refusal to acquire tax-delinquent properties before they are offered at public tax sale.

Question 124: A Wisconsin real estate agent acting as a transaction broker owes which of the following to both parties?

No duties whatsoever
Full fiduciary duties including undivided loyalty
Limited duties including honesty, fairness, and disclosure of material facts (Correct answer)
Only the duty to show up at closing

Correct answer: Limited duties including honesty, fairness, and disclosure of material facts

A transaction broker in Wisconsin owes limited duties of honesty, fairness, and disclosure of material adverse facts to both parties.

Question 125: To qualify for a Wisconsin broker license, how many hours of broker pre-licensing education are required?

36 hours
The additional broker education course beyond salesperson training (Correct answer)
No additional education
72 hours

Correct answer: The additional broker education course beyond salesperson training

Broker applicants must complete additional approved broker-level education beyond the salesperson course.

Question 126: Under Wisconsin law, when must a real estate licensee provide the agency disclosure form to a prospective buyer?

At the first substantive contact (Correct answer)
After the offer is accepted
Only if the buyer requests it
At closing

Correct answer: At the first substantive contact

Wisconsin law requires the agency disclosure to be provided at the first substantive contact with a prospective buyer.

Question 127: An applicant who completed pre-licensing education many years ago may need to:

Retake the entire broker course
Obtain a federal waiver
Verify the education still meets current approval and recency rules (Correct answer)
Nothing, education never expires

Correct answer: Verify the education still meets current approval and recency rules

Education must meet current approval standards, and older coursework may need to satisfy recency requirements.

Question 128: Net listings are treated how under Wisconsin real estate practice?

They are discouraged/prohibited due to conflict-of-interest risk (Correct answer)
They are the required default listing type
They must always be verbal
They eliminate the need for a written agreement

Correct answer: They are discouraged/prohibited due to conflict-of-interest risk

Net listings create a conflict of interest and are prohibited or strongly discouraged because the broker's pay depends on price above a set net to the seller.

Question 129: In a loan with a due-on-sale (alienation) clause, what happens if the owner sells?

The buyer automatically assumes the loan
The lender can require the loan be paid in full (Correct answer)
The interest rate is frozen
Nothing changes

Correct answer: The lender can require the loan be paid in full

A due-on-sale clause lets the lender demand full repayment when the property is transferred.

Question 130: Which of the following best describes a fiduciary-level relationship in Wisconsin real estate?

A relationship with an unrepresented third party
A customer relationship with no written contract
A client relationship established by a written agency agreement (Correct answer)
A casual inquiry at an open house

Correct answer: A client relationship established by a written agency agreement

Client relationships created by written agency agreements carry the highest, fiduciary-level duties.

Question 131: Which factor most directly influences a buyer's mortgage qualification based on their income?

Cap rate
Gross rent multiplier
Debt-to-income ratio (Correct answer)
Reproduction cost

Correct answer: Debt-to-income ratio

The debt-to-income ratio compares a borrower's debt obligations to income to assess loan qualification.

Question 132: Under Wisconsin law, refusing to rent because a prospective tenant receives Social Security disability payments would most likely violate which protection?

Marital status
Ancestry
Familial status
Lawful source of income (Correct answer)

Correct answer: Lawful source of income

Rejecting a legal income source like disability benefits violates the lawful source of income protection.

Question 133: In a Wisconsin real estate transaction, a customer is best described as a party who:

Has waived all rights to agency disclosure
Is provided services but is not represented by the broker (Correct answer)
Has signed an exclusive listing agreement with the broker
Receives fiduciary duties from the broker

Correct answer: Is provided services but is not represented by the broker

A customer receives services such as honesty and fair dealing but does not have a formal agency relationship or receive fiduciary duties from the broker.

Question 134: In the income approach, capitalization rate is calculated by dividing net operating income by:

Gross income
The loan amount
Annual expenses
Value (or sale price) (Correct answer)

Correct answer: Value (or sale price)

Cap rate = Net Operating Income / Value; rearranged, Value = NOI / Cap Rate.

Question 135: A loan where the borrower pays only interest during the term and repays principal in a lump sum at the end has a:

Graduated payment
Fully amortized schedule
Negative amortization
Balloon payment (Correct answer)

Correct answer: Balloon payment

A balloon loan requires a large lump-sum payment of remaining principal at the end of the term.

Question 136: The ratio comparing a loan amount to the property's appraised value is the:

Capitalization rate
Debt-to-income ratio
Gross rent multiplier
Loan-to-value (LTV) ratio (Correct answer)

Correct answer: Loan-to-value (LTV) ratio

The loan-to-value ratio measures the loan amount as a percentage of the property's value.

Question 137: In Wisconsin, how long does a buyer typically have to obtain a financing commitment under the standard WB-11 form?

The date specified in the offer (Correct answer)
60 days from inspection
30 days from listing date
15 days from acceptance

Correct answer: The date specified in the offer

The financing commitment deadline is specified by the parties in the offer itself rather than being a fixed statutory period.

Question 138: In a Wisconsin real estate transaction using the WB-11 Residential Offer to Purchase, what is the definition of 'Binding Acceptance'?

When the last party to sign the offer does so.
When the buyer receives verbal confirmation from the seller that the offer is accepted.
When the earnest money is deposited into the listing firm's trust account.
When the accepted offer is delivered back to the party who made the offer according to the delivery terms specified. (Correct answer)

Correct answer: When the accepted offer is delivered back to the party who made the offer according to the delivery terms specified.

Binding Acceptance occurs not just when the offer is signed, but when the signed, accepted offer is delivered back to the other party (or their agent) in a manner specified in the contract. This is a critical step that creates the binding contract. Until delivery occurs, the party who made the offer can typically withdraw it.

Question 139: Under Wisconsin's Fair Housing Law, which of the following scenarios is generally permissible?

A landlord charging a higher security deposit for tenants with disabilities who have service animals.
An advertisement for an apartment that reads "Ideal for single professionals."
A landlord refusing to rent a two-bedroom apartment to a family with four young children due to a reasonable local occupancy ordinance. (Correct answer)
The owner of a 20-unit apartment building refusing to rent to anyone under the age of 30.

Correct answer: A landlord refusing to rent a two-bedroom apartment to a family with four young children due to a reasonable local occupancy ordinance.

Wisconsin law allows property owners to comply with reasonable local, state, or federal government restrictions on the maximum number of occupants permitted in a dwelling. Refusing to rent based on a violation of such an ordinance is not considered illegal discrimination based on family status. The other options represent illegal discrimination based on age, marital/family status (in advertising), and disability.

Question 140: A commercial property generates a net operating income of $45,000. An investor requires a 7.5% capitalization rate. What is the maximum the investor should pay for the property?

$600,000 (Correct answer)
$500,000
$337,500
$675,000

Correct answer: $600,000

Value = NOI ÷ cap rate: $45,000 ÷ 0.075 = $600,000.

Wisconsin Real Estate License Exam

The Wisconsin Real Estate License Exam exam validates essential knowledge and skills required for certification or licensure in this field.

140

Questions

150 min

Time Limit

75%

To Pass

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