PSI TOPIC EXAM
QUESTIONS AND ANSWERS
The following questions serve as additional practice for the PSI exam. The
answers/explanations are located in the back of this supplement.
Property Law
1. Title to real estate can be transferred under the terms of all of the following
documents except:
1. A deed
2. A living will
3. A living trust
4. A simple will
2.A property is sold and the seller’s lender agrees to release its lien, even
though the lender will receive less than the full outstanding balance of the
loan. This is known as:
1. A short sale
2. Intestate succession
3. A refinance
4. Loan to value ratio
3.Victor Vendee purchased a home from Veronica Vendor under a land
installment contract. Victor has not made any required monthly payments to
Veronica for over 4 months. Assuming applicable state law allows, Veronica
,has the following choices available to her as a remedy for Victor’s contract
breach:
1. Send Victor a notice of foreclosure
2. Send Victor a notice of forfeiture
3. 1 only
4. 1 and 2
4. Dan has a loan secured by his home. Dan’s lender is Bank Trust Company
(BTC). Dan has failed to make several mortgage payments to BTC and, as a
result, BTC has begun to send collection notices. If Dan files for bankruptcy,
BTC must:
1. Send Dan a notice of acceleration before it can continue its collection efforts
2. Send Dan a notice of foreclosure before it can proceed with foreclosure
3. Send Dan a notice of forfeiture
4. Stop all collection activity during the pendency of Dan’s bankruptcy petition
, 5. Janet recently passed away, and her will was submitted to probate. Her
probate estate consists of:
1. All of Janet’s personal property
2. All of Janet’s real estate
3. All of Janet’s real estate and personal property
4. All of Janet’s personal and real property that her executor chooses
to include in the probate estate
6.Bob, Barry, and Bonita Barnes have inherited a farm from their father
under the terms of his will. Bonita was named as executor. The estate
attorney told the Barnes family that the probate process could take up to one
year. All three Barnes children agree to sell the property as soon as possible.
Bonita:
1. Can join Bob and Barry in conveying the property to a third party during the
probate process
2. Can sell the property as executor and keep the proceeds for herself
3. Must not allow the sale of the farm until the probate process is complete
4. Cannot profit from the sale of the farm because she is the executor
7. Howard Development Conglomerate (HDC) purchased a warehouse and is
planning to tear it down to build a shopping mall. The Environmental
Protection Agency has just sent a letter to HDC stating that some hazardous
waste was buried on the site of the warehouse during World War II. In the
letter, the EPA states that it plans to charge HDC for the costs of the cleanup
efforts. HDC’s general counsel has informed HDC’s president that HDC is
unlikely to have to pay for the cleanup costs. If he is correct, it would most
likely be because:
1. The statute of limitations has run out of claims for cleanup of hazardous
wastes from old WWII-era dump sites.
2. HDC had a Phase I environmental study done which showed no
QUESTIONS AND ANSWERS
The following questions serve as additional practice for the PSI exam. The
answers/explanations are located in the back of this supplement.
Property Law
1. Title to real estate can be transferred under the terms of all of the following
documents except:
1. A deed
2. A living will
3. A living trust
4. A simple will
2.A property is sold and the seller’s lender agrees to release its lien, even
though the lender will receive less than the full outstanding balance of the
loan. This is known as:
1. A short sale
2. Intestate succession
3. A refinance
4. Loan to value ratio
3.Victor Vendee purchased a home from Veronica Vendor under a land
installment contract. Victor has not made any required monthly payments to
Veronica for over 4 months. Assuming applicable state law allows, Veronica
,has the following choices available to her as a remedy for Victor’s contract
breach:
1. Send Victor a notice of foreclosure
2. Send Victor a notice of forfeiture
3. 1 only
4. 1 and 2
4. Dan has a loan secured by his home. Dan’s lender is Bank Trust Company
(BTC). Dan has failed to make several mortgage payments to BTC and, as a
result, BTC has begun to send collection notices. If Dan files for bankruptcy,
BTC must:
1. Send Dan a notice of acceleration before it can continue its collection efforts
2. Send Dan a notice of foreclosure before it can proceed with foreclosure
3. Send Dan a notice of forfeiture
4. Stop all collection activity during the pendency of Dan’s bankruptcy petition
, 5. Janet recently passed away, and her will was submitted to probate. Her
probate estate consists of:
1. All of Janet’s personal property
2. All of Janet’s real estate
3. All of Janet’s real estate and personal property
4. All of Janet’s personal and real property that her executor chooses
to include in the probate estate
6.Bob, Barry, and Bonita Barnes have inherited a farm from their father
under the terms of his will. Bonita was named as executor. The estate
attorney told the Barnes family that the probate process could take up to one
year. All three Barnes children agree to sell the property as soon as possible.
Bonita:
1. Can join Bob and Barry in conveying the property to a third party during the
probate process
2. Can sell the property as executor and keep the proceeds for herself
3. Must not allow the sale of the farm until the probate process is complete
4. Cannot profit from the sale of the farm because she is the executor
7. Howard Development Conglomerate (HDC) purchased a warehouse and is
planning to tear it down to build a shopping mall. The Environmental
Protection Agency has just sent a letter to HDC stating that some hazardous
waste was buried on the site of the warehouse during World War II. In the
letter, the EPA states that it plans to charge HDC for the costs of the cleanup
efforts. HDC’s general counsel has informed HDC’s president that HDC is
unlikely to have to pay for the cleanup costs. If he is correct, it would most
likely be because:
1. The statute of limitations has run out of claims for cleanup of hazardous
wastes from old WWII-era dump sites.
2. HDC had a Phase I environmental study done which showed no
