Sample practice questions

A few real questions from this free bank, with full explanations. Use the practice tool above for the whole set.

1. 1. Property Ownership

   A commercial tenant bolts custom display shelving to the walls to run a retail store. Absent any agreement to the contrary, what is the usual character of that shelving?

   • a.A permanent fixture that automatically belongs to the landlord
   • b.Real property that must be conveyed with the building
   • c.A trade fixture the tenant may remove before the lease ends
   • d.An easement appurtenant to the leased space

   Answer: c

   Explanation: Items a commercial tenant installs to conduct business are trade fixtures. Even though they are attached, the law lets the tenant remove them before the lease ends (repairing any damage), because the tenant's intent was to use them in the business, not to improve the landlord's property permanently. This is an exception to the general rule that attached items become part of the realty. It is not an easement, which is a right to use another's land, not an object.

2. 2. Contracts

   A broker reviews a purchase agreement during file review. Which set of elements must be present for the agreement to be a valid contract?

   • a.Offer, acceptance, earnest money, and a recorded deed
   • b.A licensed broker, an appraisal, financing, and a survey
   • c.Written form, notarization, witnesses, and a closing date
   • d.Competent parties, mutual assent, lawful object, and consideration

   Answer: d

   Explanation: A contract needs competent parties, mutual assent (a valid offer and acceptance), a lawful object, and consideration; a real estate contract must also be in writing to satisfy the statute of frauds. Earnest money is customary evidence of good faith but is not an element, and a deed is the instrument that conveys title after the contract is performed. Notarization and witnesses matter for recording documents, not for contract formation. An appraisal, financing, and a survey are transaction steps a contract may require, not elements that make it enforceable.

3. 3. Contracts

   An affiliated licensee resigns and joins a competing firm while several listings she took still have months left to run. What becomes of those listing agreements?

   • a.They follow the licensee to her new brokerage automatically
   • b.They stay with her former firm, which reassigns servicing of them
   • c.They terminate at once, freeing each seller to relist anywhere
   • d.They convert to open listings until each seller signs a new one

   Answer: b

   Explanation: The listing is a contract between the seller and the brokerage, so the firm keeps it when the individual who took it departs, and the broker assigns another licensee to service the property. Moving a listing to the new firm takes both the releasing broker's agreement and the client's, which is why departures are negotiated rather than assumed. A resignation does not terminate the seller's contract, so the seller is not free to relist elsewhere while the term runs. Nor does the agreement quietly become an open listing, because changing the type of listing requires a new agreement the seller signs. A written departure policy stating what an agent may take avoids most of these fights.

4. 4. General Principles of Agency

   During a routine file review, a broker discovers that an agent failed to deliver a required disclosure to a buyer two weeks ago. What is the broker's best course of action?

   • a.Close the file and note that the agent alone was responsible
   • b.Wait and see whether the buyer raises the issue after the closing
   • c.Correct the omission promptly and retrain the agent on the policy
   • d.Direct the agent to backdate the disclosure to the original date

   Answer: c

   Explanation: Supervision includes catching and curing violations, not just detecting them. The broker should deliver the missing disclosure at once, document the correction, and address the training gap so the office does not repeat it. Waiting for the buyer to complain lets the harm compound and looks like knowing acquiescence. Assigning blame to the agent in the file does not shift responsibility, because failure to supervise is charged to the broker independently. Backdating is falsification of a transaction record, converting a curable oversight into fraud by the firm.

5. 5. Practice of Real Estate

   A homeowner advertises a house for sale by owner and publishes a phone number. A licensee wants to call and offer listing services. What does the rule allow?

   • a.The published number permits any call to that owner
   • b.The ad invites buyers, not solicitation calls
   • c.Publishing a number creates an established relationship
   • d.Registry rules never apply to residential sellers

   Answer: b

   Explanation: A for-sale-by-owner advertisement invites inquiries about buying that specific property; it is not permission to call and solicit listing or other brokerage services, and regulators have treated that solicitation as covered telemarketing. Publishing a number does not create an established business relationship, which arises from a prior purchase, transaction, or inquiry with the firm itself. The registry rules apply to residential consumers generally, so sellers are not carved out of them. Before any such call the licensee should scrub the number and check the firm's own internal do-not-call list.

6. 6. Financing

   A real estate licensee who holds no loan originator license takes a buyer's financial information, then negotiates the rate and terms of a seller carryback note for extra compensation. This conduct:

   • a.Is exempt because an active real estate license already covers loan negotiation
   • b.Is governed only by the RESPA kickback provisions
   • c.Is prohibited outright by federal law in every state
   • d.May require mortgage loan originator licensing under the SAFE Act

   Answer: d

   Explanation: The SAFE Act requires licensing or registration, through the national system, of anyone who takes a residential mortgage loan application and offers or negotiates loan terms for compensation or gain. Doing both for a fee moves a licensee toward origination, and a real estate license is not a substitute credential. The activity is not flatly banned; it is regulated, and narrow exemptions for property owners financing their own sales vary in scope. RESPA governs kickbacks and settlement charges and does not address origination licensing. Simply referring a buyer to a lender is not origination.

7. 7. Valuation and Market Analysis

   A lender orders a valuation for a $900,000 commercial loan secured by an apartment building, and a broker asks whether any licensed appraiser may complete it. What is the general national framework?

   • a.Appraiser credential levels limit the value and complexity of assignments
   • b.Any state-licensed appraiser may value any property type at any loan amount
   • c.Federally related transactions never require an appraisal
   • d.Certification levels apply only to residential appraisals

   Answer: a

   Explanation: Appraisers hold tiered credentials, and each tier defines the complexity and value of assignments the holder may accept: a state-licensed appraiser handles the simplest residential work, a certified residential appraiser handles more complex residential assignments, and a certified general appraiser is the credential associated with commercial property such as an apartment building of this size. Saying any licensee may appraise any property ignores the tiers entirely. Federally related transactions do generally require an appraisal by a state-credentialed appraiser above the applicable threshold, so that statement is backwards. Certification is not limited to residential work; the general certification exists precisely for commercial assignments.

8. 8. Real Estate Calculations

   A lender uses a 28% front-end housing ratio. A loan applicant's stable gross monthly income is $7,200. Under that ratio alone, what is the maximum monthly PITI payment the applicant qualifies for?

   • a.$1,800.00
   • b.$2,880.00
   • c.$2,592.00
   • d.$2,016.00

   Answer: d

   Explanation: The front-end ratio caps housing expense at a percentage of gross monthly income, not take-home pay: $7,200 x 0.28 = $2,016. PITI means principal, interest, taxes, and insurance, plus any association dues the lender counts. Applying 36%, which is a common back-end total-debt ratio, gives $2,592 and overstates the housing allowance. Using an older 25% guideline gives $1,800, and using a 40% total-debt figure gives $2,880. Check: $2,016 / $7,200 = 0.28. A broker who pre-screens buyers with the wrong ratio sends them shopping in the wrong price range and wastes everyone's time.

9. 9. Property Disclosures

   A lender selling a foreclosed house and a trustee selling a home neither has ever occupied both ask the broker whether they must complete the state's seller disclosure form. The broker should explain:

   • a.The exemption is complete, so neither the seller nor the licensee owes disclosure
   • b.The form may be excused, but known material facts must still be disclosed
   • c.Every seller must complete the form, because these statutes admit no exceptions
   • d.The exemption shifts the duty to complete the form onto the listing brokerage

   Answer: b

   Explanation: Most states with a seller property disclosure statute exempt certain transfers from the form itself, commonly sales by a fiduciary such as an executor, personal representative, or trustee, and transfers by a lender after foreclosure, on the theory that the seller has no personal knowledge of the property. Which sellers qualify differs by state and must be checked against the local statute, so no single rule fits every jurisdiction. The exemption excuses paperwork, not honesty: a seller who actually knows a material fact may not conceal it, and the licensee's own duty to disclose known material facts to a buyer is unaffected. The obligation is never transferred to the brokerage by the exemption.

10. 10. Virginia Licensing

    18VAC135-20-10 defines "actively engaged" for the Virginia broker experience requirement as active licensure performing licensed activity for what level of effort?

    • a.Any level of effort, so long as the license stayed active
    • b.At least twenty transactions closed over the same period
    • c.An average of at least 40 hours per week over the period
    • d.At least six months of full-time work in each of three years

    Answer: c

    Explanation: The definition in 18VAC135-20-10 reads that "actively engaged" means "active licensure with a licensed real estate firm or sole proprietorship in performing those activities as defined in Section 54.1-2100 of the Code of Virginia for an average of at least 40 hours per week." Holding an active license is therefore necessary but not sufficient; a licensee who parked a license with a firm and sold nothing has active licensure without the hours. The regulation measures time rather than production, so no transaction count appears in it and an applicant with a light but full-time practice still qualifies. And the standard is an average across the qualifying period rather than a run of separately certified full-time months, which is why subsection C of 18VAC135-20-35 has the principal or supervising broker verify the experience rather than having the applicant document each month.