National Real Estate Exam Test bank V2– 2026/2027 Academic Year –Complete Questions and Correct Answers | Verified Study Guide | Grade A

National Real Estate Exam Test bank V2– 2026/2027 Academic Year –Complete Questions and Correct Answers | Verified Study Guide | Grade A 2026 / 2027 Academic Year Q: An unlicensed secretary is the only one in a residential real estate office when Broker Carr from another company calls requesting information on a property. The secretary may: A. give him the sale price and address B. take his name and have a licensee return the call C. give any information necessary since it is another broker and not a member of the general public D. mail the broker information B Q: Which must be licensed by the Missouri Real Estate Commission? A. the publisher of a magazine to aid "for sale by owners " in selling their homes B. a lake property developer registered with HUD C. an employee of a corporation selling corporate property D. an apartment manager representing the owner who shows rental units A Q: Chapter 339 of the Missouri Statutes is also known as: A. law of agency B. code of ethics C. license law D. administrative commission code C Q: Which would require a license? A. an attorney transferring real estate for a client B. an auctioneer employed by an owner C. a property manager actively leasing and selling for a real estate company D. an owner transferring his own property C Q: Which of the following would require a real estate license? A. an attorney transferring property for a client B. an auctioneer employed by the owner C. a property manager employed by a broker to only show apartments D. a person who negotiates or helps consumers consummate option to buy or sell real estate D Q: A salesperson licensed in another state but NOT in Missouri comes into Missouri and refers her brother to a real estate company in Missouri to assist him in the purchase of a home. The salesperson did this with the knowledge and permission of her broker, and the salesperson's broker cooperated with a Missouri broker in the sale of the property. What commission is she due? A. the full commission since she is licensed in another state B. half the commission since the other half would go to her company C. her commission would be based on her agreement with her broker D. no commission since she is NOT licensed in Missouri C Q: A motel desk clerk gives the names of persons looking to purchase a home who are moving into town to a salesperson friend in exchange for a referral fee. Which BEST describes the situation? A. they would NOT need a license since their primary income comes from their salary B. they had a license, they could accept referral fees from the salesperson C. they would need a license and would only be able to accept compensation from their broker D. they could accept compensation without a license as long as it was not in money form C Q: The license law is known as: A. Chapter 11 B. Chapter 339 C. Chapter 7 D. Chapter 12 B Q: How many members are there on the commission? What are the qualifications to be on the commission? 7 members. U.S. citizen. appointed gov. with the consent of Missouri Senate. 6 members must be licensed for at least 10 yrs and 1 member must be from the general public. terms are 5 yrs. commissioners receive $75/day plus expenses when they are meeting. all members vote. must be MO residents for at least one year. may hold an inactive RE license during their employment. Q: The _______: - Is made up of three attorneys who are admitted to practice before the Missouri Supreme Court - Work for the Attorney General's office - Review cases sent to them by the MREC - Holds hearings when requested by the MREC to: determine guilt or innocence. if innocent, case dismissed. if guilty, sent back to the MREC for punishment or dismissal. Q: *A person who is refused a license by the MREC appeals that decision to the ______. MAHC (Missouri Administrative Hearing Commission) Q: A citizen phoned the MREC with a complaint on a licensee. The MREC sent him a form to fill out. However, he never followed up with the complaint in writing. What would the MREC do? A. the MREC must follow up on an oral complaint B. the MREC can NOT act on an oral complaint C. the MREC must ignore the complaint D. the MREC can investigate on its own volition D Q: If an unlicensed person sells real estate for a fee, or accepts a referral fee for a real estate transaction, the MREC: A. May file a restraining order but has no other remedies against unlicensed individuals. B. May file a restraining order and assess a civil penalty of up to $2,500 per occurrence (based on the finding of the Missouri Administrative Hearing Commissioner (MAHC). C. May file a restraining order and assess a fine of $5,000 payable to the MREC. D. May require the individual to take a course on real estate law. B Q: A complaint has been filed against Broker Grant. The MREC has the power to: A. subpoena Broker Grant and his business records B. subpoena Broker Grant's personal accounts C. fine Broker Grant D. subpoena anyone in any state the commission chooses A Q: The authorities are investigating a violation of the law by a licensee. Which could happen? A. the Administrative Hearing Commission could revoke or suspend his license B. the Missouri Real Estate Commission could revoke or suspend his license C. the Missouri Real Estate Commission could impose criminal penalties D. the Administrative Hearing Commission could impose criminal penalties B Q: Which of the following individuals would be required to have a real estate license? A. An attorney B. An auctioneer employed by the owner C. A friend of a licensee who receives compensation for referring a client to the licensee D. A developer selling Missouri land owned by the developer. C Q: The MREC has heard rumors that a broker is violating the law. Can the MREC investigate? A. yes, but they are limited in the investigation of the incident that sparked the rumors B. yes, no complaint is necessary for the MREC to investigate C. no, because there has not been any allegation of criminal conduct D. no, because there has not been a complaint filed by either a licensee or the public B Q: The MREC, believing an unlicensed person has violated the law, may file a complaint in: A. only the U.S. District Court B. only the appeals court C. only the court in the county where the act was committed D. any court of competent jurisdiction D Q: The MREC, in investigating a licensee, may A. issue subpoenas for all records relevant to the complaint B. petition the attorney general for an injunction to keep the licensee from leaving the state C. make the licensee submit to a polygraph examination D. subpoena out of state residents who were involved in the transaction A Q: Two brokers got into a dispute over who was due what part of a commission. One of the brokers filed a complaint with the MREC to get it settled. Which is true? A. the MREC will settle the dispute at the next monthly meeting. B. the MREC will make recommendations as to who should get the commission but will NOT make the final decision C. the MREC may revoke the license of the broker who withheld the commission falsely D. the MREC will NOT enter into any dispute over commissions between licensees. D Q: The broker changes his company address. He must A.phone the MREC B. notify the MREC by registered mail C. give the MREC written notice within 5 days D. give the MREC written notice within 10 days D Q: James wants to make sure he is working with a licensed real estate broker when he is renting property. He asks to see the license of the agent and the broker with whom he is working. Which is true? A. James is nosey and does not need to see anything B. James is a member of the public and is entitled to see a license, or he may call the real estate commission and verify whether or not the individuals are licensed C. A real estate salesperson and/or broker should carry their licenses and display it upon request when involved in a real estate transaction D. Licensees are not required to tell the public that they are licensed B Q: A broker-salesperson acting as a sales manager cannot: A. act as a sales manager and supervisor at a branch office B. act as a salesperson working under a broker C. hold all the licenses of the salespeople working under him/her D. sell and list property C Q: A corporation was entering the real estate business. It must be registered with: A. MREC B. HUD C. local county recorder D. the Board of Realtors A Q: A broker with one salesperson is retiring and moving to Florida to run a grocery store. He wants the salesperson to continue to have her job. Can he still do this? A. yes, but both he and the salesperson would have to get both Missouri and Florida licenses B. yes, as long as he retained his Missouri broker's license C. no, because he would NOT be in control of the salesperson's actions D. no, because his license is automatically terminated when he moves from the state C Q: A branch office under a principal broker: A. would have to have its own set of licenses B. would operate under its own broker's license C. would operate under a duly appointed salesperson D. would operate under the principal broker's license D A person owned her own company specializing in negotiating sales for buyers and sellers. She had incorporated her business but does not get listings or sell properties. Does she need a real estate license to do this? A. no, she does NOT need a license because she was not listing property B. no, she does not need a license because she was not selling property C. yes, she would need a broker-officer's license and her corporation would need a broker's license D. yes, she needs a broker's license, but her corporation is exempt since it will not list or sell property C A broker opened a branch office. Who could have authority to manage the office? A. broker-salesperson B. salesperson C. any licensee so designated D. the broker A A written complaint had been filed against a salesperson. However, the salesperson was in the process of transferring to another broker. Which of the following is TRUE regarding the situation? A. the new broker would usually be notified by the Real Estate Commission (MREC) of the fact that a complaint is pending B. the salesperson must wait 60 days to transfer to another company C. the salesperson must wait 45 days to transfer to another company D. the complainant would get a written record of the salesperson's answer to the complaint A Which is true when a corporation receives a broker's license? A. all brokers licensed under the corporation must be officers of the corporation B. all corporate officers involved in the brokerage business must have active broker-officer licenses or a salesperson's license, but the salesperson cannot participate in the supervision of the office C. all corporate officers must have active salesperson licenses D. when the license is issued to the corporation, the individual officers will no longer require individual licenses B Two brokers are applying for a broker's license as a partnership. One of the two had been found guilty of embezzlement but has made full restitution. Which of the following is true? A. if the license is denied, they should contact the MAHC for a hearing B. one broker couldn't get the partnership licenses as long as she was a business associate of the other C. the MREC may never issue the license D. the brokers may apply to the MREC for a hearing if the license is denied A A broker dies, and his company is placed in receivership. A. all sales contracts are canceled by the death of the broker B. the MREC can appoint a "receiver" to handle the existing sales contracts C. the MREC can appoint a temporary broker to finish the existing sales contracts D. the court would receive all contracts C The MREC can appoint a temporary legal license in which case? A. upon the death of the broker to terminate all listing agreements and coordinate the closing of pending contracts between sellers and buyers B. a temporary salesperson's license may be issued in cases of extreme urgency C. if a broker could NOT obtain a partner D. to allow a licensee who has had a license revoked to reprove himself A Mr. Baird was the sole proprietor of a commercial real estate company. He died. His son, Jim Baird did not have a real estate license, but he was named executor of the estate. Jim Baird: A. can continue the real estate company in his name as he is the executor of the estate B. can transfer listings to another broker C. can be appointed to finish only the business in process D. must purchase all the listings C Dole is considering creating a real estate company as a corporation. If he does so, which license would be required of the corporation itself? A. a broker's license B. a broker-officer's license C. a salesperson's license D. a broker-associate license A All of the following are requirements for licensure of a salesperson EXCEPT: A. honesty and integrity B. citizenship C. complete an approved salesperson's course D. send in money by certified check or money order B When Brokers' Licenses are renewed, they are issued for a period ending: A. one-year period on June 30 B. one-year period on Jan 1 C. two-year period on Jan 1 D. two-year period on June 30 D Persons with which of the following qualifications may apply for a broker's license? A. the sponsoring broker states that the salesperson has been active for 12 months B. the person has completed an approved course and has passed the state's examination and has been an active salesperson for at least two years. C. the person had 10 listings and 4 sales D. anyone who has been licensed 6 months and pays the fee B Which of the following is not grounds for the MREC to refuse to issue a license? A. conviction of obtaining money under false pretenses B. fraud on application C. bankruptcy D. revocation of an earlier license C To receive a real estate license, which of the following is true? A. must be 18 years of age or older B. must be a citizen of the United States C. must be a citizen of North America D. must be a resident of Missouri A In applying for a real estate license: A. you must make 70% on the state examination B. you must complete a sales training course C. you must enclose the license fee as a cashier's check, money order, or personal check D. you may apply for the broker's license before passing the salesperson's exam C Salesperson Baird was born in Finland. He moved to Missouri, went to a prelicense school, took the test, passed and was licensed under a broker. He then sold a property. Would Baird be eligible for a commission? A. yes, since he passed the test B. yes, since he fulfilled the legal requirements of the law C. no, because he was not a citizen D. no, since he was born in Finland B Which of the following statements about real estate licenses is true? A. each license is issued for a one-year period and expires on June 30. B. the real estate commission must send a renewal application to the licensee's last known address by certified mail at least 30 days in advance of the license expiration date. C. if a licensee does not receive a renewal notice, the real estate commission rules provide an automatic 30 day grace period. D. a new license will be issued only upon receipt of the fee and properly completed application. D On February 6, John Grant finished and passed a salesperson's pre-license class. On August 25, John passed the salesperson's examination. Can John receive a license? A. yes, because he took a pre-license course B. yes, because he passed a pre-license course C. no, because he did Not apply for license within 6 months of the date on his class certificate C. no, because he did Not apply for license within 60 days after passing the exam C The license fees are payable by: A. cash by certified mail B. personal check only C. cashier's check, personal check, or money order made payable to Missouri Real Estate Commission D. cashier's check only C Which is true of license forms? A. you will be sent a renewal notice by certified mail B. if you do NOT receive a renewal notice, you will receive a 30 day grace period C. you must send in the appropriate application and renewal fee D. renewal is automatic unless you are notified C In the event of a dispute over earnest money: A.the broker should release the money to whomever the contract calls for B. the broker should release the money to the seller due to the fiduciary situation C. the broker should hold the money until both parties sign a release D. the broker should hold the money until all parties to the contract sign a release, or within 365 days if the parties cannot come to terms, release the monies to the State Treasury. A A contract between the buyer and seller failed. The buyer claimed the earnest money was his; the seller claimed the earnest money was his. After 60 days the broker sent a registered letter saying he would give the earnest money to the seller. Lacking response from either party when could the broker release the money? A. after 10 days B. after 15 days C. after the judgment of the court D. never, the broker must have a mutual release B A broker desires to keep an escrow account in an interest bearing checking account. Would this be legal? A. yes, if both buyer and seller agree in writing that it goes into an interest-bearing escrow account B. yes, if the buyer agrees in writing that the buyer's funds may go into an interest-bearing escrow account C. yes, if the seller agrees in writing that the seller's future funds go into an interest-bearing escrow account D. yes, if all parties to the transaction agree, in writing, that the money is to go into an interest-bearing account and who is to receive the interest D Which is TRUE regarding a broker's escrow account? A. it must be an insured account B. it must be in the state of Missouri C. it can be in any state as long as it is properly registered with the MREC D. it must be in an interest bearing account C A broker took earnest money from a friend and deposited it in the broker's personal account. This is: A. misrepresentation B. commingling C. waste D. a felony B How long does a salesperson have to deliver earnest money to the broker? A. Immediately B. 2 banking days C. 5 banking days D. 7 banking days A Any change to a listing agreement or other written authorization must contain: A. a notary seal B. the signatures of two impartial witnesses C. the initials or signatures of all parties D. a full documentation of the reason(s) for the change(s) C In dealing with a potential customer, a salesperson may A. advertise a guaranteed profit on a property B. guarantee future profits which may result from the resale of real property C. both of the above D. neither of the above D Margaret King is a licensed salesperson. She is selling her property as a FOR SALE BY OWNER (FSBO). What must she disclose in her advertisement in the newspaper? A. For Sale-Call Margaret King 728-3434 B. For Sale-Call Big Realty, Margaret King 728-3434 C. For Sale-Owner D. For Sale-Owner-Salesperson D Bill, a licensed real estate salesperson places an ad in the newspaper for a buyer of a property he has listed for sale. His ad reads: "Come and see this wonderful lake lot located on beautiful Lake Scenic. If you purchase one lot, we will give you a second lot free and also enter your name in our lottery sweepstakes." Which is true of this advertisement? A. The ad is well written and should attract many buyers B. The ad should give the property address C. The ad should list Bill's address D. The ad is a violation of the license law because it offers free inducements D Which of the following is not needed on a current Listing Agreement? A. the price B. a provision requiring an owner to notify the broker of intent to cancel the listing after the expiration date C. a definite beginning date D. an expiration date B A new broker is considering opening his office in his home. Which of the following is true? A. he could only employ 2 salespersons B. it must be open to the public during regular business hours if he has salespersons licensed under him C. he could have the office in his home as long as he employs no more than four salespeople D. He could never employ salespeople while working out of his home B Jim and Larry who are not licensees form a company to deal in exchanges of property. After completion of a deal, the parties refuse to pay them a commission. Can they sue for the commission? A. yes, as they had performed according to the agreement B. yes, no license is required as the properties were exchanged rather than sold C. no, since the properties were exchanged no valuable consideration was given D. no, they were unlicensed; therefore, they were in violation of state license law D At what point must a listing broker FIRST disclose to a buyer the broker's agency relationship with the seller in a residential real estate transaction? A. before the buyer gives the broker personal or financial information B. when the broker writes the contract C. at the first written contact D. at the first oral contact A A disclosure to the buyer from a subagent working as a seller's agent must include all the following EXCEPT: A. a statement that the agent is acting on behalf of the seller B. the source of the commission that is to be made C. a statement that any information given to the subagent may be disclosed to the seller D. a statement that the seller is facing bankruptcy D A buyer asked Broker Carr to find a house for a flat fee of $5,000. The buyer and broker signed a buyer's agency agreement in which the buyer agreed to pay the $5,000 fee. Carr found a special home listed by Broker Baird. The buyer agreed to purchase the home. Broker Carr never mentioned anything about the buyer's agency agreement or the fee to the cooperating broker, nor was it disclosed in writing in the contract. Can Broker Carr retain the $5000 and share in the seller's commission with Baird? A. yes, since both brokers had agency agreements B. yes, because brokers can decide to split commissions as the brokers see fit C. no, it is illegal to receive commission from more than one party to a transaction D. no, as Broker Carr had not obtained written, prior permission from both the seller and buyer in the contract between the parties D A salesperson pre-qualified a buyer and took personal information at that time. The salesperson then showed a buyer several homes. Prior to showing the homes, the salesperson had the buyer sign an agency disclosure form. Did the salesperson do anything wrong? A. yes, the salesperson should never show a house without qualifying the buyer B. yes, the salesperson should have disclosed his/her agency relationship prior to taking personal information C. no, the salesperson disclosed his agency prior to showing any properties D. no, the salesperson should disclose agency only if asked B A salesperson told a buyer that the air conditioner would stay with the house. However, he had not checked it with the seller. After closing the seller took the air conditioner. Which would happen? A. the salesperson would have to pay for the air conditioner B. the MREC would automatically revoke his license C. the MREC can take disciplinary action D. the buyer would have to look to the seller for action C At the time of the listing, a broker noticed a large crack in the wall that was partially covered by boxes. In showing the property, the licensee should: A. inform the prospective buyer of the crack B. inform the prospective buyer of the crack only if asked C. not tell the buyer since the agent represents the seller D. move the boxes to allow the buyer to see for themselves A Broker A received an offer of $189,000 on a $200,000 listing. After the seller had given the offer to his attorney to review, another offer for $176,000 came in. What should the broker do? A. present the offer as a backup B. do not present because it was not for full price C. wait until the first offer is acted upon D. present the offer immediately D Broker Falk has a listing. Broker Carr found a buyer for Broker's Falk's listing. A salesperson could close the transaction if: A. he was under the direct supervision of the listing broker B. he was under the direct supervision of the manager or broker with whom the salesperson is associated C. he was under the direct supervision of a broker who was not his broker D. a salesperson cannot close a transaction, only a broker can close them B Broker Carr has taken a listing from Seller Dole. Which is true? A. he must give him a copy at the time of signing B. he may send him a copy the next business day C. he must give him a copy within 3 business days D. he must give him a copy at the time of signing if requested by the seller A An out of state owner calls a broker wanting to sell his property for $50,000. The broker knows that zoning has recently been changed and the property is now worth $75,000. The broker does not inform the seller. Is this legal? A. yes, as the broker bought it himself and did NOT put it on the market. B. yes, as the broker got the price the seller was asking C. no, the broker must inform the owner of the zoning and increased value D. no, the broker can NOT buy listed property as this would be a conflict of interest C All are true regarding listings EXCEPT: A. listing agreements may NOT have automatic extensions B. listing agreements must have an expiration date C. a copy of the listing agreement must be given to the seller D. both buyer and seller must sign the listing agreement D Broker Carr has a 90 day listing on a property. One month after the listing had begun, Broker Dole contacted the seller and told him that he had a buyer moving in one month after the listing terminates and ask the seller to sign an agreement to take effect after the listing expires. This is: A. misrepresentation B. a violation of state real estate law C. allowable since the listing would have expired D. considered commingling of listings B When Susan listed a home for the Smiths, she was told by the sellers that the lot measured 75' x 150'. Susan told the buyers this information and the house sold. After taking possession, the buyers had the lot surveyed and discovered that the lot was only 75' x 130'. Which best describes this situation? A. Susan was in no way responsible as she was acting as an agent for the principal B. the buyers may sue Susan and her broker for damages C. if the MREC learns of this they will automatically revoke Susan's license D. the AHC can suspend or revoke Susan's license if they feel she should have been more careful B Jamie Jones tried to renew his license, but he failed to complete the continuing education requirements. Three months later Jamie wanted to reinstate his license. Jamie would have to do which of the following? A. pay a late fee of $150 only B. pay a late fee and take the continuing education he had missed C. pay a late fee, take the pre-license class and pass the real estate test D. pay a late fee of $50 a month not to exceed $200, and take the Missouri Practices course. D Which of the following would NOT count for continuing education credit in Missouri? A. A course concerning updates of Chapter 339 B. A course all about the Fair Housing Laws C. Training in business skills such as typing, personal motivation, salesmanship, sales psychology, or time management D. A review of contract and agency law (Law of Agency) C Tom, a licensed salesperson for 20 years obtains his broker's license during the current licensing period. Which of the following will Tom have to take in order to renew his license? A. 3 hours of core - 9 hours of electives B. 6 hours of core - 6 hours of electives C. 24 hours of continuing education D. 24 hours - Missouri Real Estate Practices Course A A licensee attended three continuing education courses for the elective hours. Each course was 6 hours long. How can she apply these to her renewal requirement? A. use 9 for this period; carry 9 into the next licensure period B. use 12 hours for credit even though she only needs 9 elective hours C. use 9 hours for electives D. use all 18 hours for total accreditation this renewal period C Rich, a licensed salesperson, took 12 hours of continuing education courses during the current licensing period. How many of those hours had to represent "Core" courses? A. 12 B. 9 C. 3 D. 6 C When a broker closes his office, the salesperson must find a new broker. The broker who is closing the office and the salesperson must do all of the following EXCEPT: A. the broker must notify the commission immediately that the salesperson will no longer be associated with him B. the broker is obligated to return the salesperson's license with the (office) closing statement to the MREC C. if the broker does not notify the MREC, then the salesperson can never transfer to a new broker D. the salesperson must return all property to the broker, including listings, forms, signs, etc. C The property manager must make a written statement of property income to the owners of rental properties how often? A. once a week B. once a month C. once every six months D. once a year D Fees and commissions must be removed from a property management escrow account unless otherwise stated in a written agreement how often? A. at least once a week B. at least once a month C. at least once a year D. whenever the broker wishes B If an individual broker's license is revoked or suspended, all of the following are true EXCEPT: A. the broker must remove all advertising signs from all properties B. the broker must arrange for all pending contracts to close. The broker must notify the MREC who will handle the closing of these transactions C. the broker must notify the MREC where all the records will be stored for the term of the suspension D. if the broker's license is suspended, a salesperson can continue to operate the company until the suspension is over D If an owner gave a broker money for repairs on a rental property, where should the broker deposit the money? A. property management escrow account B. property management repair account C. broker's escrow account D. broker's operating account A If an individual broker dies (there is no other broker in the company) who can be appointed as a "Temporary broker" and for what purpose? A. Anyone licensed or not can be appointed as a "Temporary broker" to "Terminate the existing transactions," close the company, and return all the salespersons' licensees to the MREC B. only a licensed broker from another company can become a "Temporary broker" C. only a salesperson who is licensed to the company can become the "Temporary broker" D. there is no such thing as a "Temporary broker" the company has to close immediately A A management agreement between a property manager and an owner must include all of the following EXCEPT: A. identification of the property B. specify the terms and conditions on which the broker will remit income from the property C. specify whether security deposits will be held by the broker or the owner D. today's date D The disbursements from an escrow account of a property manager must show all EXCEPT: A. check number B. indicate the related transaction C. indicate to whom the check was written and why D. balance of the account to the owner D Which of the following is true about a net listing in Missouri? A. It may be in oral form only. B. It must be in writing according to the Statute of Frauds. C. It is the only type of listing allowable in Missouri that can be canceled without notice to the broker. D. It is illegal and prohibited in Missouri. D If the MREC denies a salesperson's license to any applicant, the Commission must do all of the following except: Salesperson French presents a written offer for $189,000 to seller Dutch. The listed price is $200,000. Dutch reviews the offer and seeks further advice from her accountant. Salesperson French receives a second written offer, this one for $175,000. Which of the following is true about this situation? A. French must wait until Dutch accepts or rejects the first offer before he presents the second offer to Dutch. B. French must present the second offer promptly. C. French cannot present the second offer at any time because it is 90% lower than the list price. D. French must present the second offer as a backup contract. B A. notify the applicant, in writing, stating the reasons for the denial of licensure. B. inform the applicant, in writing, of his right to file an appeal with the AHC. C. notify the applicant of this denial within ten (10) days of receipt of license application. D. send all notifications by certified mail. C A salesperson did not renew his/her license, or take twelve (12) hours of continuing education. Three (3) months later, he/she decides to renew. What must a salesperson do to renew a license under these circumstances? A. Pay the fee and take the continuing education courses. B. Pay the fee and take the 48-hour prelicensing course. C. Pay the fee and take the 24-hour Missouri practices course. D. Take the 48-hour prelicensing course, take and pass the state examination and apply as an original applicant. C A person finished pre-license school on July 31, 2012. After taking the examination on December 15, the applicant received a passing score on December 31, 2012. The person applied for a license on January 15, 2013. Could this person receive a license? To renew an active license, how many elective hours of continuing education do you need? A. 3 hours B. 6 hours C. 9 hours D. 12 hours C A. No, because the applicant had taken the school in a different calendar year from applying for a license. B. Yes, because the applicant applied for a license within six (6) months after completing the school. C. No, because it had been over six (6) months from the time of completing the school and applying for a license. D. Yes, because the applicant applied for a license within sixty (60) days after passing the examination. B Can the MREC suspend a license while the salesperson is under investigation? A. Yes, the MREC can suspend a license anytime they want. B. Yes, a salesperson's license can be suspended, but a broker's cannot. C. No, a salesperson must have a hearing and be found guilty by the AHC before the MREC can suspend his license. D. No, once a license has been issued, it cannot be suspended for any reason other than a felony. C Dawn, a licensed salesperson, was at a party and a young couple expressed interest in buying a new home. Dawn mentioned that her own home was for sale and that she would be happy to show it to them. In this case, which of the following is true? A. The salesperson must disclose that she is licensed and the owner of the property. B. The salesperson must have the permission of her broker before showing her home to a prospective purchaser. C. Because this is the salesperson's own property, she need only disclose that she is the owner of the property. D. The salesperson is prohibited from selling her own property. A The MREC, believing a licensee has violated the law, may file a complaint: A. only in the U.S. District Court. B. only in the appeals court. C. only in a court of the county where the act was committed. D. in any court of competent jurisdiction. D If you are turned down for a license, what would be your most reasonable course of action? A. Request a hearing before the MREC (Missouri Real Estate Commission). B. Request an investigation by the attorney general. C. Request a hearing before the local Board of Realtors. D. Request a hearing before the AHC (Administrative Hearing Commission). D A listing agent who shows property to a ready, willing, and able buyer still has certain obligations to the buyer. Which of the following is not a true statement? A. An agent shall disclose to the buyer all material facts about the property and explain the term "AS IS" in any counter offers to purchase. B. An agent must disclose to the buyer all personal and financial facts regarding the seller's reasons for selling the property. C. An agent must not discourage the use of an attorney or require the buyer to use a specific lender, insurance company, title company, appraiser, survey company, or building inspection company. D. An agent must promptly tender to the buyer any contract offer that has been accepted, rejected, or countered by the seller. B The buyer wants to have his earnest money placed in an interest bearing account. Can the broker do this? A. Yes, if the interest goes to the broker. B. Yes, if all parties to the transaction agree to the interest-bearing account and who will receive the interest. C. No. Regardless of what the buyer wants, the broker can never put the money in an interest-bearing account because it is a violation of the Missouri License Law. D. No, because this is the seller's money and he has to make the decision. B A new agent got permission from friends to put "for sale" signs in their yards. When buyers called in, she told them the house had sold, but she would be happy to help them find another. Is this permissible? A. Yes, it's simply a sales technique. B. Yes, as long as friends were justly compensated. C. No, since the properties were not really sold. D. No, since the properties were not really "for sale" and this is a misrepresentation. D A branch office under a principal broker: A. would have to have its own set of licenses B. would operate under the principal broker's license C. would operate under a duly appointed salesperson D. would operate under its own broker's license B The MREC received a formal, written complaint about Broker Grant's business conduct and intends to investigate the matter. In order to hold a hearing to decide the validity of the complaint, the MREC, may do which of the following? A. Subpoena Broker Grant to appear and give testimony. B. Subpoena any person in or outside the state of Missouri to produce records or other documentation which might have a bearing on the validity of the complaint in question. C. Close the broker's business until the issue is resolved. D. The MREC does not investigate -- only the AHC investigates. A A young couple is selling their first residence and would like a lawyer to check over the sale contract. The listing agent, who knows the contract is well written and that the contract used is approved by the attorney of their local association of REALTORS ®, advises them that a lawyer's services would be an unnecessary expense and would only serve to reduce their net proceeds from the sale. Which of the following statements is true? A. The salesperson should never advise against or discourage the use of an attorney in any transaction in which he/she is involved. B. The salesperson may advise against using an attorney, but only if it will save the sellers money. C. The salesperson's actions were correct because a lawyer must check sales contracts on commercial transactions only. D. The salesperson is to be commended for looking out for the best interest of his principals. A What can a broker-salesperson who is a branch office manager for a large real estate company do? A. The office manager cannot continue to sell and list property because he/she would be in direct competition with the salespeople. B. As a principal broker, the office manager must manage. C. The office manager may not list or sell. D. Missouri law does not prohibit branch managers from listing or selling. D A broker had several branch offices. Which is true regarding the management? A. The broker would have to have direct supervision over the main branch and branch offices. B. A broker-salesperson can have direct supervision over the branch office. C. A salesperson must have direct supervision over the branch offices. D. Each branch office must have a full-time broker who does NOT sell or list. B As a condition of license renewal, all active salespeople must complete the following: A. Three hours of required core curriculum by June 30th and nine hours of elective courses by September 30th. B. Attend at least 1 hour of a continuing education lecture every other month throughout the licensing period. C. Attend 6 hours of core curriculum courses and 6 hours of elective courses during the renewal period. D. Attend 12 hours of certified continuing education courses, 3 hours of core credit and 9 hours of elective credit, by September 30th of even years. D A friend who was getting a divorce called the broker to ask the broker to complete a quit claim for the friend to deed the property to his ex-wife. Can the broker do this? A. Yes, because a broker is allowed to complete standardized forms even when he is not involved in the transaction. B. Yes, the broker may complete the form for a nominal fee. C. No, the broker can never complete a quit claim deed since it is not a standardized form. D. No, since he is not a party to the transaction, he would be practicing law if he completed the form. D When a salesperson terminates his/her association with a broker, which of the following statements is true? A. The agent has six months to place his license with another broker or put his/her license on inactive status with the MREC. B. The agent may have friends' listings transferred to his/her new broker. C. The broker must return the salesperson's license to the MREC within 48 hours. D. The broker must give the agent his license when the agent submits a written notification of resignation. A A broker's branch office: A. would have all licensees licensed under the branch manager B. would operate under the same name and license as the parent office C. would operate under the same name, but under a different license than the parent office D. must have its own escrow account B A woman passed the salesperson examination and is eager to begin listing and selling homes. What can she do? A. She will automatically receive a license. B. She can list homes, but cannot sell them. C. She must apply for a license on the forms provided by the MREC. D. She must first take her broker's sales training before she can begin work. C A licensed broker acting as a property manager deposits current rental money into a(n): A. property management escrow account B. business account C. management account D. escrow account A A broker who had several offices went about once a week to each office to check them out. Since he had no other broker on staff, is this legal? A. Yes, as long as he saw each office at least once per week. B. Yes, as long as he was readily accessible by telephone. C. No, a broker can only manage two offices at one time. D. No, because he was not in direct control of the salespersons' actions. D A salesperson associated with Rainbow Realty decides to purchase one of the company's listed properties and submits an offer to purchase. The agent did not disclose to the seller that she/he is an agent with Rainbow Realty. This agent may be charged with which of the following license law violations? A. Undisclosed Dual Contracts B. Undisclosed Dual Listings C. Undisclosed Dual Agency D. Undisclosed Commingling C Salesperson Karr negotiated a purchase contract with a prospect who met the conditions of a special first time buyer bond proposal, except for the fact that the negotiated sale price was $2,000 higher than the authorized limit set in order to qualify for the bond monies fully. Karr arranged another agreement with the seller, whereby the sale contract indicated a price within the limit, and another contract covered the $2,000 excess. Which of the following statements about this situation is true? A broker lists a property, but fails to indicate an expiration date. When questioned about this by the owner, the broker states that the listing contract is for 180 days but that the property will be sold by then. Is this a legal listing agreement? A. This arrangement is considered creative financing and is perfectly legal. B. Although such arrangements are discouraged, Karr acted legally because he was carrying out the direct orders of the seller in order to sell the property for the list price. C. If the AHC (Administrative Hearing Commission) finds out about this arrangement, it will automatically suspend Karr's license. D. Karr is subject to disciplinary action by the MREC for violating the law against dual contracts. D A. Yes, as long as the broker sells it within 180 days as promised. B. Yes, as long as there is a commission determined at the listing interview. C. No, it is illegal because a listing cannot be for more than 90-days. D. No, it is illegal because there was no expiration date indicated. D A salesperson is asked to take a promissory note from the buyer. What should he do? A. The salesperson should go to his broker for help. B. The salesperson should do nothing: the salesperson cannot accept non-money items as earnest money. C. The salesperson should make the buyer get real cash or a check instead of a promissory note. D. The salesperson should write the offer and explain to the seller in the offer that the earnest money is a promissory note. D Which of the following is legal advertising? A. A broker who owns a building with a sign that reads, "For Sale, 555-1224." B. A broker who owns a building with a sign that reads, "For rent by Owner, 555-1234." C. A broker listing his own property with a sign that reads, "For Sale by Owner, 555-1234." D. A broker has a listing on his own property with a sign that reads, "For Sale, call ABC Realty." D How many broker members are there on the MREC? A. 4 B. 5 C. 6 D. 7 C Eager Edgar, a licensed salesperson, lists seller Sue's home. After Sue signs the listing agreement, what is the proper procedure for Edgar to take? A. He must leave a copy of the listing agreement with Sue at the time of signing. B. He may wait to send a copy of the listing agreement to Sue until after the broker reviews and signs the documents. C. He may wait to send a copy of the listing agreement to Sue until after the property is placed in MLS. D. He is not required to furnish a copy of the listing agreement at any time because it is an employment contract rather than a sale contract. A A person walks into Urban Realty and asks to be shown some homes in the area. Regarding agency disclosure, the agent must inform the potential buyer of specific facts. Which of the following is required by the License Law? A. The agent must inform the potential buyer that the agent always represents the seller of any listed property and that agent will not represent the buyer at all. B. The agent must inform the buyer that any information received from either the buyer or seller will be fairly communicated to the both sides. C. The agent must inform the buyer that an agency disclosure form must be signed by the buyer prior to any property being shown. D. The agent must inform the buyer that if the buyer wishes representation, he must sign a Buyer's Agency Agreement before seeing any property. D If you receive a "Certificate of Completion" on Feb. 1, what is the last date that you may apply for the license? A. July 1 B. July 20 C. August 1 D. August 20 C A broker had so many lawsuits that he decided to change the name of his branch offices to avoid further problems. Could he do this? A. Yes, he may do so with the approval of the MREC. B. Yes, but all advertising must be done with both names. C. No, all branch offices must have the same name as the parent office. D. No, the MREC assigns the names for each branch office. C During the noon hour, all of the licensees at Dream Home Realty were out to lunch. A secretary was left to answer the telephone and to take messages. At 12:30, Salesperson Sampson of New Homes Inc., called to ask for information concerning one of Dream Homes' residential listings. In this situation, the secretary should: A. give Sampson the information he needs but encourage him to get in touch with one of Dream Homes' agents as soon as possible. B. take Sampson's name and telephone number and tell him that a licensee from Dream Homes Realty will call him back when the licensee returns from lunch. C. reveal only the sale price and street address of the listing and get the contact information for Sampson so you can have the Dream Home agent call him back. D. tell Sampson that this information can only be given to a licensed broker and not a salesperson. B To renew a salesperson's inactive license, how often must the licensee pay? A. Once -- when the license goes inactive. B. Once a year to the MREC. C. Never. An inactive licensee never has to renew. He/she is inactive for life. D. By Sept 30 of even years. D Auctioneer Grant is negotiating to auction off some odds and ends for a farm family. In the course of the negotiation, the farmer asks Grant if he could also auction off the farm. Which BEST describes the situation? A. He would NOT have to have a real estate license as long as he sold the personal property and the farm together. B. He would NOT have to be licensed as long as he sold only the personal property and the land without any improvement on the land itself. C. He would have to have a real estate license to auction off the farm. D. He would NOT have to have a real estate license as he was auctioning it for the owner. D Salesperson Bird, has been licensed as a salesperson for at least two years. He has just passed the state broker examination and would like to apply for a broker-salesperson's license. In order to meet the requirements, he must include which of the following with his application? A. His personal affidavit stating that he has been actively engaged in the real estate business for at least one year. B. A certificate from an accredited school stating that within 6 months prior to the date of application that he had successfully completed a broker's license course offered by that school. C. A letter of proficiency from his broker stating that Bird has procured at least ten listings and at least ten closed sales. D. A statement from his broker indicating that Bird has finished management training and has been assigned as a branch manager for one of his broker's branch offices. B A salesperson decides to transfer to another broker. He wants to take his listings with him. If he gets the consent of each seller to do this, is he within his rights to take these listings to another broker? A. Yes, because they were personally acquired by him all of the listings may be transferred to the salesperson's new broker. B. No, a listing agreement may not be transferred to another broker without the express written consent of the seller and the original broker. C. Yes, the seller's consent to have that specific agent market the seller's home allows the salesperson to assign, transfer, or sell the listing contract. D. No, a listing contract is canceled when the salesperson is transferred or terminates employment. B A licensed salesperson wants to include her home phone number on a sign that she placed on one of her listed properties. The sign must also include her broker's: A. business telephone number B. beeper number C. home phone number D. business address A A salesperson is transferring to a new broker. What must be done before he/she can list or sell real estate? A. A salesperson must give his/her license to his/her broker to send to the MREC. B. Have the old broker call the new broker and set a date when the salesperson can start work. C. The new broker must obtain the salesperson's work permit from the MREC. D. No action is necessary to continue to list and/or sell real estate. C A salesperson, licensed in another state (not in Missouri), is visiting St. Louis and helps her father sell his listed property. The agent finds a buyer through a local church group and successfully negotiates the sale of the St. Louis residence. The salesperson is entitled to which of the following considerations from the listing broker of her father's property? A. A finder's fee. B. The buyer's agency commission offered in MLS. C. The normal commission offered by the broker under the sub-agency clause of the listing contract signed by the agent's father. D. No commission is due to the agent because she is not licensed in MO. D Which of the following is a true statement about a salesperson who violates the Missouri Real Estate License Law? (Chapter 339-250) A. The agent could be charged with a class B felony. B. The agent may not be subject to criminal prosecution under the general laws of the state. C. The agent may not incur civil liability under the general laws of the state. D. The agent could have his license revoked for violation of the law. Violation of MREC rules is a Class B Misdemeanor. D A buyer was told, by a licensed agent, that the second-story window air conditioner would remain with the house if the buyer paid the asking price. The salesperson had not confirmed this with the seller, and the seller removed the unit before closing. The buyer paid the full price for the house then discovered the unit missing and contacted the MREC to file a complaint. Which of the following statements is correct? A. The MREC will require the broker to buy an air conditioner for the buyers. B. The MREC may suspend the salesperson's license for making a misrepresentation. C. The MREC can only levy a fine against the salesperson equal to the cost of a new air conditioner. D. The MREC has no power or authority to take action. B A licensee negotiates the sale of a home intended for his fiancée and himself. He properly identifies himself as a licensee to the seller but neglects to disclose that he is getting married to the buyer. Do the actions of the licensee violate the license law? A. Yes, because a licensee cannot purchase or negotiate the sale of property in which the licensee will have a future interest. B. Yes, because the licensee did not disclose his possible future interest to the seller. C. No, because a licensee's marital plans do not require agency disclosure. D. No, because a licensee is simply required to give proper real estate company identification only. B An inactive licensee refers his brother as a buyer to an out-of-state broker. How much money can he receive for a referral fee? A. He will receive a referral fee directly from the out-of-state broker since he does not have a broker in Missouri. B. He will get 50% of the commission from the out-of-state broker. C. He will get whatever is called for in the referral agreement. D. He will get nothing. D All of the following are violations of Missouri License Law except: A. Telling a potential buyer that the property will definitely appreciate in value and that a substantial profit will be made on the resale of this real estate investment. B. Advising a young married couple to take title as tenancy by the entirety; explaining their rights in the event the seller breaches the contract, and helping them to rewrite a better offer to purchase. C. Placing the buyer's $2,000 earnest money deposit in an escrow account after acceptance of a contract by the seller. D. Preparing a special sales contract to suit the needs of a new home buyer who disagrees with the terms of a standard form and who intends to fill in the blanks after the contract is accepted. C Salesperson Link brings an offer to the seller of a listed property. After considering the offer for an hour, the seller accepts and signs the offer without changing any of the terms presented. Link then presents the buyer with a copy of the accepted contract. Which of the following must be included in this contract for sale? A. The date the property was shown to the buyer. B. The date the buyer signed the offer and instructed Link to present it to the seller. C. The date the offer was presented to the seller. D. The date of final agreement between the parties. D If the MREC receives a complaint against a broker, they could subpoena: A. past clients and customers from out of state B. the broker's business and personal records C. people from out of state D. the broker's business accounts and records D A seller leaves a buyer approximately one half of a tank of heating oil at the closing. If the tank measures 4' x 2' x 3', how many cubic feet did the buyer receive? A. 8 cubic feet B. 24 cubic feet C. 12 cubic feet D. 24 square feet C What is 75% converted to a decimal? A. 75.0 B. 7.50 C. 0.75 D. 0.075 C John bought an odd-shaped lot that was 100 feet deep, but the front footage was 160 feet and the length of the back side of the lot was 80 feet. What is the square footage of his lot? A. 16,000 SF B. 8,000 SF C. 24,000 D. 12,000 SF D A developer wants to develop a 20-acre subdivision. He figures that the streets and common area will take up about 25% of this overall area. If the minimum lot size is to be 10,000 SF, how many lots can the developer have on this property? A. 43 B. 65 C. 86 D. 66 B If a salesperson sells 3/4 of an acre for $80,000, what was the price per square foot rounded to two decimal spaces? A. $2.45 B. $3.00 C. $1.49 D. $1.50 A Stacey owns a lot that has 180 feet of front footage and contains 36,000 square feet. She purchases two lots adjacent to each side of his lot. These side lots are each 200 feet deep and contain 19,000 square feet. What is the total front footage of all three lots? A. 190 B. 200 C. 275 D. 370 D What is the GIM of a strip mall with an annual income of $547,500 and a value of $6,345,000? A. 8.6 B. 139.1 C. 103.2 D. 11.6 D A property is being appraised by the Cost Approach. The appraiser estimates that the land is worth $17,000 and the replacement cost of the improvements is $235,000. Total depreciation from all causes is $23,000. What is the indicated value of the property? A. $229,000 B. $275,000 C. $252,000 D. $212,000 A The subject property does not have a pool or a screen porch. A comparable that sold for $205,000 has a $1,000 screen porch, one more $2,500 half-bathroom, and a $6,000 pool. Assuming all else is equal, what is the adjusted value of the comparable? A. $200,500 B. $195,500 C. $214,500 D. $207,500 B A property is being appraised using the Income Capitalization Approach. Annually, it has a Potential Gross Income of $40,000, vacancy and credit losses of $3,500, and operating expenses of $16,000. Using a capitalization rate of 8%, what is the indicated value (to the nearest $1,000)? A. $300,000 B. $256,000 C. $456,000 D. $500,000 B A commercial property sold for $564,000 and its GIM ratio was 8.7. What was the annual income of the property (rounded to the nearest $100)? A. $154,300 B. $47,000 C. $64,800 D. $56,400 C What is the GRM of a gas station with a monthly rent of $8,700 and a value of $970,000? A. 89.7 B. 111.5 C. 124.4 D. 99.9 B If you owe $14,000 on a new loan and pay $880 of interest for the year, your interest rate is? A. 0.048 B. 0.123 C. 0.057 D. 0.063 D A borrower has a monthly payment of $1,980 on a loan with a monthly constant of 6.45. What is the loan amount (to the nearest hundred)? A. $354,800 B. $283,300 C. $198,000 D. $307,000 D A borrower obtained a 70% loan for $600,000. What was the price of the home (to the nearest hundred)? A. $420,000 B. $857,000 C. $750,000 D. $769,000 B A lender uses a 39% debt ratio. A borrower earns $40,000 / year and has monthly non housing debt payments of $700. What housing payment can she afford? A. $600 B. $700 C. $900 D. $1,300 A A home buyer pays $1,800 / month for the interest-only loan on his new house. The loan's interest rate is 6%. If he obtained an 80% loan, what was the purchase price? A. $216,000 B. $275,000 C. $450,000 D. $360,000 C Jackie obtains a 60% LTV loan on her new $250,000 home with an annual interest rate of 5.5%. What is the first month's interest payment? A. $688 B. $1,146 C. $458 D. $750 A A principal residence is bought for $190,000. A new porch is added, costing $9,000. Five years later the home sells for $261,000, and the closing costs are $21,000. What is the homeowner's capital gain? A. $50,000 B. $62,000 C. $71,000 D. $41,000 D A property has a net income of $40,000, interest payments of $17,000, and annual cost recovery of $9,000. The property's tax rate is 25%. What is the property's annual tax liability? An office building sells for $979,000 at a cap rate of 8.3%. What is its NOI? A. $97,900 B. $85,173 C. $92,772 D. $81,257 D A. $5,750 B. $