New York Real Estate Salesperson Exam — Complete Study Guide (2026)

The rule: New York's Property Condition Disclosure Act (PCDA)

New York's Property Condition Disclosure Act (Real Property Law Article 14) requires a seller of residential (1–4 family) property to deliver to the buyer, before signing the contract, a completed Property Condition Disclosure Statement (PCDS) — a standardized questionnaire about the home's condition (structure, water, sewer/septic, environmental, mechanical systems, etc.).

The 2024 change — the $500 credit is gone. For years a seller could decline to deliver the statement and instead give the buyer a $500 credit at closing, and most sellers did. An amendment effective March 20, 2024 deleted that option. Today:

• Delivery is mandatory. "Every seller of residential real property ... shall complete and sign a property condition disclosure statement" and deliver it to the buyer or the buyer's agent before the buyer signs a binding contract of sale; a signed copy is attached to the contract (RPL § 462(1)).
• The form asks about flood risk. The statement now asks whether the property is in a FEMA floodplain, a Special Flood Hazard Area ("100-year floodplain") or a Moderate Risk Flood Hazard Area ("500-year floodplain"), whether flood insurance is required or carried, whether federal flood-disaster aid was received, whether an elevation certificate exists, and whether flood-damage insurance claims were filed (RPL § 462(2)).
• Liability. Section 465, now titled "Liability," makes a seller liable only for a willful failure to perform the Act's requirements — and then for the buyer's actual damages, on top of any other remedy (RPL § 465(2)).

(RPL §§ 462 and 465 as read on nysenate.gov, 23 September 2026; § 465 last revised March 29, 2024.) A candidate who answers "the seller may give a $500 credit instead" is giving the pre-2024 answer. Regardless of the form, a seller may not actively conceal a known defect or make a false statement.

The rule: the federal lead-based paint disclosure

For housing built before 1978, federal law (the Residential Lead-Based Paint Hazard Reduction Act, "Title X", enforced by the EPA and HUD) requires the seller or landlord to:

• Disclose any known lead-based paint or hazards and provide any relevant records/reports.
• Give the buyer/tenant the EPA pamphlet "Protect Your Family from Lead in Your Home."
• Include a lead-warning statement in the contract with signatures.
• Give home buyers a 10-day period (or another period the parties agree to) to conduct a lead inspection or risk assessment at their own expense.

This applies nationwide, including New York, and the licensee must ensure it happens. New construction (1978 or later) is exempt.

The rule: other required disclosures

• Agency disclosure (Chapter 5) — the statutory NY agency relationship form (RPL § 443).
• Housing and Anti-Discrimination Disclosure Form (DOS-2156) (Chapter 3) — to every prospective buyer, tenant, seller or landlord at first substantive contact (19 NYCRR § 175.28).
• Material defects known to the licensee, and honesty when asked (Chapter 5).
• Special districts, assessments, or conditions the contract or local law requires.

The rule: the New York attorney-driven closing

New York is an attorney-state. Unlike many "escrow states" where a title/escrow company runs the closing, in New York each side is typically represented by its own attorney, and the closing is a face-to-face (or attorney-coordinated) meeting where documents are signed and funds and the deed change hands. The licensee's role is to bring the parties to contract and coordinate, not to practice law — drafting or advising on the contract's legal terms is the attorney's job, and a licensee who does so risks unauthorized practice of law. A common New York feature is the attorney-approval contingency: after signing, each party's attorney has a short window to review and approve or cancel.

At closing, the parties handle:

• Deed delivery and recording; transfer taxes (Chapter 12) paid.
• Loan documents (note and mortgage) signed; lender funds disbursed.
• Title cleared and title insurance issued.
• Prorations — property taxes, fuel, and other items split between buyer and seller as of the closing date (Chapter 12).
• The closing disclosure/settlement statement reconciling all credits and debits.

Worked example — who does what at a New York closing?

A salesperson has a signed deal. The buyer asks the salesperson to "just tweak the contract's contingency language" and to "explain what the mortgage covenants mean." The salesperson should decline both — modifying contract legal terms and interpreting legal documents is the attorney's role in New York, and doing it would be the unauthorized practice of law. The salesperson's proper job is to facilitate: relay the request to the buyer's attorney, keep the transaction on schedule, and make sure the required disclosures (agency, PCDS, lead paint if pre-1978) are delivered.

Key figures — Chapter 9

- PCDA (RPL Art. 14): residential 1–4 family seller must deliver the Property Condition Disclosure Statement before the buyer signs the contract (RPL § 462). The $500 credit option was repealed effective March 20, 2024. Seller liable for actual damages for a willful failure (RPL § 465). The form now includes flood-zone and flood-insurance questions. - DOS-2156 fair-housing disclosure at first substantive contact (19 NYCRR § 175.28). - Lead paint (federal Title X): pre-1978 housing — disclose knowns, give EPA pamphlet, lead-warning clause, 10-day buyer inspection option. New construction exempt. - Agency disclosure: before the agency agreement with your client; at first substantive contact with the other side (RPL § 443; Chapter 5). - NY closing = attorney-driven: each side's own attorney; attorney-approval contingency; licensee must not practice law. - At closing: deed delivery/recording, transfer tax, loan docs, title insurance, prorations, settlement statement.

Common traps — Chapter 9

• Lead-paint rule is 1978 (pre-1978 triggers it) — do not confuse the year with the PCDA.
• The $500 credit is history. Since March 20, 2024 the seller must deliver the PCDS; older books that describe a $500 opt-out credit are out of date.
• New York is an attorney-closing state, not an escrow-company state — a favorite distinction from escrow-state questions.
• Licensees must not practice law — no drafting or interpreting legal terms; that is the attorney's role.
• Caveat emptor is narrowed, not erased — active concealment or false statements are always actionable.

Check yourself — Chapter 9

1. Which New York act requires a residential seller to give the buyer a condition disclosure statement?
2. The federal lead-based-paint disclosure applies to housing built before what year?
3. In a New York closing, who typically represents each of the buyer and seller?
4. May a salesperson redraft the legal contingency language in a contract?
5. What is the standard federal inspection period a home buyer gets for lead-based paint?

Answers: 1. The Property Condition Disclosure Act (RPL Article 14). 2. 1978. 3. Each party's own attorney (New York is an attorney-closing state). 4. No — that is the unauthorized practice of law; it is the attorney's role. 5. 10 days (unless the parties agree otherwise).