PSI FINAL EXAMINATION — 2026/2027
PSI FINAL EXAMINATION
2026/2027 — 160 Questions — PSI Services LLC
Comprehensive Multi-Domain Practice Assessment
Covers: Real Estate | Insurance | Cosmetology | Contractor | Healthcare | Security | Professional
Certification
Instructions: Select the single best answer for each question. A passing score of 70-75% is typically required
per most PSI-administered programs. Total testing time: approximately 2.5-4 hours. This comprehensive
practice exam covers multiple PSI-administered licensing domains.
Domain Questions Points
I. Real Estate Licensing 16 16
II. Insurance Producer Licensing 16 16
III. Cosmetology/Barber Licensing 16 16
IV. Contractor/Trade Licensing 16 16
V. Healthcare Certifications 16 16
VI. Security/Public Safety Credentials 16 16
VII. Professional Certification Exams 16 16
VIII. Regulatory Compliance & Ethics 16 16
IX. Documentation & Reporting Standards 16 16
X. Scenario-Based Critical Thinking 16 16
TOTAL 160 160
SECTION I: REAL ESTATE LICENSING (Questions 1–16)
1. Which form of property ownership includes the right of survivorship, meaning that when
one co-owner dies, the deceased owner's interest automatically passes to the surviving co-
owner(s)?
A. Tenancy in common
B. Joint tenancy with right of survivorship
C. Sole ownership
D. Life estate
Correct Answer: B
Joint tenancy with right of survivorship means that upon the death of any joint tenant, the deceased
tenant's interest automatically passes to the surviving joint tenant(s) without going through probate. This
is a key distinction from tenancy in common, where each owner's share passes according to their will or
intestacy laws.
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, PSI FINAL EXAMINATION — 2026/2027
2. Under the Fair Housing Act (Title VIII of the Civil Rights Act of 1968, as amended), which of
the following classes is NOT a federally protected class?
A. Race
B. Sexual orientation
C. Religion
D. National origin
Correct Answer: B
The federal Fair Housing Act prohibits discrimination based on race, color, religion, national origin, sex,
familial status, and disability. Sexual orientation and gender identity were not explicitly included in the
original federal statute, although many state and local laws provide such protections. The FHA was
amended in 1988 to add familial status and disability.
3. A real estate agent who represents both the buyer and the seller in the same transaction is
operating under which type of agency relationship?
A. Exclusive buyer agency
B. Dual agency
C. Sub-agency
D. Single agency
Correct Answer: B
Dual agency occurs when a single agent or brokerage firm represents both the buyer and seller in the same
real estate transaction. Dual agency must be disclosed to and consented by both parties, as it creates an
inherent conflict of interest because the agent owes fiduciary duties to both parties simultaneously.
4. In a residential real estate transaction, earnest money deposited by the buyer is typically
held in which type of account?
A. The listing broker's personal checking account
B. An escrow or trust account maintained by a neutral third party
C. The seller's operating account
D. The buyer's personal savings account
Correct Answer: B
Earnest money is typically deposited into an escrow or trust account held by a neutral third party such as a
title company, escrow agent, or real estate brokerage. This ensures the funds are safeguarded until all
conditions of the purchase agreement are met or the transaction is terminated according to its terms.
5. Which type of deed provides the greatest level of protection to a grantee (buyer) by
guaranteeing that the title is free from all defects and encumbrances, including those arising
from the grantor's predecessors?
A. Quitclaim deed
B. Bargain and sale deed
C. General warranty deed
D. Special warranty deed
Correct Answer: C
A general warranty deed provides the highest level of protection to the grantee, containing covenants that
guarantee the title is clear of all liens and encumbrances not specifically noted in the deed. The grantor
warrants against defects arising both during their ownership and during all prior ownership periods,
unlike a special warranty deed which only covers the grantor's period of ownership.
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, PSI FINAL EXAMINATION — 2026/2027
6. When using the market comparison approach to real estate appraisal, an appraiser adjusts
the sale prices of comparable properties to account for differences between the comparables
and the subject property. Which of the following is NOT a typical adjustment category?
A. Location adjustments
B. Size and condition adjustments
C. Adjustments for the seller's motivation to sell
D. Adjustments for the appraiser's fee
Correct Answer: D
The appraiser's fee is not an adjustment factor in the market comparison approach. Adjustments are made
for physical characteristics (size, age, condition), location, market conditions, and property rights
conveyed. The appraiser's fee is a cost of the appraisal service and has no bearing on the property's market
value.
7. A VA (Veterans Affairs) loan differs from a conventional loan primarily in that the VA loan:
A. Requires a minimum 20% down payment from the borrower
B. Is guaranteed by the U.S. Department of Veterans Affairs and does not require a down
payment or private mortgage insurance
C. Can only be used for investment properties
D. Must be originated through a federally chartered bank
Correct Answer: B
VA loans are guaranteed by the U.S. Department of Veterans Affairs and are available to eligible veterans,
active-duty service members, and certain surviving spouses. Key advantages include no down payment
requirement, no private mortgage insurance (PMI), and competitive interest rates. The VA does not
originate loans directly but guarantees a portion of the loan made by private lenders.
8. Which of the following best describes an exclusive right-to-sell listing agreement?
A. The seller retains the right to sell the property without paying commission if the seller finds the buyer
B. The listing broker is entitled to a commission regardless of who procures the buyer
during the listing period
C. Multiple brokers can list the property simultaneously with no exclusive rights
D. The broker is paid only if the broker personally finds the buyer
Correct Answer: B
An exclusive right-to-sell listing grants the listing broker the exclusive right to earn a commission upon the
sale of the property during the listing term, regardless of whether the buyer was procured by the listing
broker, another broker, or the seller directly. This is the most common form of residential listing
agreement.
9. Under RESPA (Real Estate Settlement Procedures Act), which practice is specifically
prohibited?
A. Providing borrowers with a Loan Estimate within three business days of receiving a completed loan
application
B. Requiring the use of a specific title insurance company as a condition of the loan
C. Allowing the borrower to choose their own settlement service provider
D. Disclosing all estimated closing costs on the Closing Disclosure form
Correct Answer: B
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, PSI FINAL EXAMINATION — 2026/2027
RESPA Section 9 prohibits a seller from requiring the buyer to use a particular title insurance company as
a condition of the sale. Borrowers must be free to select their own title company. RESPA also prohibits
kickbacks and unearned referral fees among settlement service providers.
10. In real estate, the principle of 'caveat emptor' (let the buyer beware) means that:
A. The seller is responsible for disclosing all known material defects
B. The buyer is responsible for inspecting the property and identifying any defects before
completing the purchase
C. The broker must guarantee the condition of the property
D. The lender must verify the property's value before approving the loan
Correct Answer: B
Caveat emptor is a legal principle placing the burden on the buyer to thoroughly inspect the property and
identify any defects before completing the purchase. While many states have modified this doctrine through
mandatory seller disclosure laws, the principle still applies to certain types of properties and conditions not
covered by statutory disclosure requirements.
11. Which type of zoning classification is most likely to be designated for a neighborhood
consisting primarily of single-family detached homes?
A. C-1 (Commercial)
B. R-1 (Residential Single-Family)
C. M-1 (Industrial)
D. PUD (Planned Unit Development)
Correct Answer: B
R-1 zoning designates areas for single-family residential development. This zoning classification typically
restricts properties to one dwelling unit per lot, with minimum lot size, setback, and building height
requirements. C-1 is for commercial uses, M-1 for industrial, and PUD allows mixed-use development under
a master plan.
12. A property owner conveys a life estate to their spouse, with the remainder interest going
to their children. When the spouse dies, what happens to the property?
A. The property reverts to the original grantor
B. The property passes to the children as remainder beneficiaries
C. The property becomes property of the state through escheat
D. The spouse's heirs inherit the property through intestate succession
Correct Answer: B
In this arrangement, the spouse holds a life estate (the right to use and occupy the property during their
lifetime), and the children hold a remainder interest. When the life tenant (spouse) dies, the property
automatically passes to the remainder beneficiaries (children) without going through probate.
13. In a real estate closing, the proration of property taxes between buyer and seller is
typically calculated based on which of the following?
A. The seller's original purchase price
B. The number of days each party owns the property during the tax year
C. The assessed value of the property only
D. The broker's commission percentage
Correct Answer: B
4
PSI FINAL EXAMINATION
2026/2027 — 160 Questions — PSI Services LLC
Comprehensive Multi-Domain Practice Assessment
Covers: Real Estate | Insurance | Cosmetology | Contractor | Healthcare | Security | Professional
Certification
Instructions: Select the single best answer for each question. A passing score of 70-75% is typically required
per most PSI-administered programs. Total testing time: approximately 2.5-4 hours. This comprehensive
practice exam covers multiple PSI-administered licensing domains.
Domain Questions Points
I. Real Estate Licensing 16 16
II. Insurance Producer Licensing 16 16
III. Cosmetology/Barber Licensing 16 16
IV. Contractor/Trade Licensing 16 16
V. Healthcare Certifications 16 16
VI. Security/Public Safety Credentials 16 16
VII. Professional Certification Exams 16 16
VIII. Regulatory Compliance & Ethics 16 16
IX. Documentation & Reporting Standards 16 16
X. Scenario-Based Critical Thinking 16 16
TOTAL 160 160
SECTION I: REAL ESTATE LICENSING (Questions 1–16)
1. Which form of property ownership includes the right of survivorship, meaning that when
one co-owner dies, the deceased owner's interest automatically passes to the surviving co-
owner(s)?
A. Tenancy in common
B. Joint tenancy with right of survivorship
C. Sole ownership
D. Life estate
Correct Answer: B
Joint tenancy with right of survivorship means that upon the death of any joint tenant, the deceased
tenant's interest automatically passes to the surviving joint tenant(s) without going through probate. This
is a key distinction from tenancy in common, where each owner's share passes according to their will or
intestacy laws.
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, PSI FINAL EXAMINATION — 2026/2027
2. Under the Fair Housing Act (Title VIII of the Civil Rights Act of 1968, as amended), which of
the following classes is NOT a federally protected class?
A. Race
B. Sexual orientation
C. Religion
D. National origin
Correct Answer: B
The federal Fair Housing Act prohibits discrimination based on race, color, religion, national origin, sex,
familial status, and disability. Sexual orientation and gender identity were not explicitly included in the
original federal statute, although many state and local laws provide such protections. The FHA was
amended in 1988 to add familial status and disability.
3. A real estate agent who represents both the buyer and the seller in the same transaction is
operating under which type of agency relationship?
A. Exclusive buyer agency
B. Dual agency
C. Sub-agency
D. Single agency
Correct Answer: B
Dual agency occurs when a single agent or brokerage firm represents both the buyer and seller in the same
real estate transaction. Dual agency must be disclosed to and consented by both parties, as it creates an
inherent conflict of interest because the agent owes fiduciary duties to both parties simultaneously.
4. In a residential real estate transaction, earnest money deposited by the buyer is typically
held in which type of account?
A. The listing broker's personal checking account
B. An escrow or trust account maintained by a neutral third party
C. The seller's operating account
D. The buyer's personal savings account
Correct Answer: B
Earnest money is typically deposited into an escrow or trust account held by a neutral third party such as a
title company, escrow agent, or real estate brokerage. This ensures the funds are safeguarded until all
conditions of the purchase agreement are met or the transaction is terminated according to its terms.
5. Which type of deed provides the greatest level of protection to a grantee (buyer) by
guaranteeing that the title is free from all defects and encumbrances, including those arising
from the grantor's predecessors?
A. Quitclaim deed
B. Bargain and sale deed
C. General warranty deed
D. Special warranty deed
Correct Answer: C
A general warranty deed provides the highest level of protection to the grantee, containing covenants that
guarantee the title is clear of all liens and encumbrances not specifically noted in the deed. The grantor
warrants against defects arising both during their ownership and during all prior ownership periods,
unlike a special warranty deed which only covers the grantor's period of ownership.
2
, PSI FINAL EXAMINATION — 2026/2027
6. When using the market comparison approach to real estate appraisal, an appraiser adjusts
the sale prices of comparable properties to account for differences between the comparables
and the subject property. Which of the following is NOT a typical adjustment category?
A. Location adjustments
B. Size and condition adjustments
C. Adjustments for the seller's motivation to sell
D. Adjustments for the appraiser's fee
Correct Answer: D
The appraiser's fee is not an adjustment factor in the market comparison approach. Adjustments are made
for physical characteristics (size, age, condition), location, market conditions, and property rights
conveyed. The appraiser's fee is a cost of the appraisal service and has no bearing on the property's market
value.
7. A VA (Veterans Affairs) loan differs from a conventional loan primarily in that the VA loan:
A. Requires a minimum 20% down payment from the borrower
B. Is guaranteed by the U.S. Department of Veterans Affairs and does not require a down
payment or private mortgage insurance
C. Can only be used for investment properties
D. Must be originated through a federally chartered bank
Correct Answer: B
VA loans are guaranteed by the U.S. Department of Veterans Affairs and are available to eligible veterans,
active-duty service members, and certain surviving spouses. Key advantages include no down payment
requirement, no private mortgage insurance (PMI), and competitive interest rates. The VA does not
originate loans directly but guarantees a portion of the loan made by private lenders.
8. Which of the following best describes an exclusive right-to-sell listing agreement?
A. The seller retains the right to sell the property without paying commission if the seller finds the buyer
B. The listing broker is entitled to a commission regardless of who procures the buyer
during the listing period
C. Multiple brokers can list the property simultaneously with no exclusive rights
D. The broker is paid only if the broker personally finds the buyer
Correct Answer: B
An exclusive right-to-sell listing grants the listing broker the exclusive right to earn a commission upon the
sale of the property during the listing term, regardless of whether the buyer was procured by the listing
broker, another broker, or the seller directly. This is the most common form of residential listing
agreement.
9. Under RESPA (Real Estate Settlement Procedures Act), which practice is specifically
prohibited?
A. Providing borrowers with a Loan Estimate within three business days of receiving a completed loan
application
B. Requiring the use of a specific title insurance company as a condition of the loan
C. Allowing the borrower to choose their own settlement service provider
D. Disclosing all estimated closing costs on the Closing Disclosure form
Correct Answer: B
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, PSI FINAL EXAMINATION — 2026/2027
RESPA Section 9 prohibits a seller from requiring the buyer to use a particular title insurance company as
a condition of the sale. Borrowers must be free to select their own title company. RESPA also prohibits
kickbacks and unearned referral fees among settlement service providers.
10. In real estate, the principle of 'caveat emptor' (let the buyer beware) means that:
A. The seller is responsible for disclosing all known material defects
B. The buyer is responsible for inspecting the property and identifying any defects before
completing the purchase
C. The broker must guarantee the condition of the property
D. The lender must verify the property's value before approving the loan
Correct Answer: B
Caveat emptor is a legal principle placing the burden on the buyer to thoroughly inspect the property and
identify any defects before completing the purchase. While many states have modified this doctrine through
mandatory seller disclosure laws, the principle still applies to certain types of properties and conditions not
covered by statutory disclosure requirements.
11. Which type of zoning classification is most likely to be designated for a neighborhood
consisting primarily of single-family detached homes?
A. C-1 (Commercial)
B. R-1 (Residential Single-Family)
C. M-1 (Industrial)
D. PUD (Planned Unit Development)
Correct Answer: B
R-1 zoning designates areas for single-family residential development. This zoning classification typically
restricts properties to one dwelling unit per lot, with minimum lot size, setback, and building height
requirements. C-1 is for commercial uses, M-1 for industrial, and PUD allows mixed-use development under
a master plan.
12. A property owner conveys a life estate to their spouse, with the remainder interest going
to their children. When the spouse dies, what happens to the property?
A. The property reverts to the original grantor
B. The property passes to the children as remainder beneficiaries
C. The property becomes property of the state through escheat
D. The spouse's heirs inherit the property through intestate succession
Correct Answer: B
In this arrangement, the spouse holds a life estate (the right to use and occupy the property during their
lifetime), and the children hold a remainder interest. When the life tenant (spouse) dies, the property
automatically passes to the remainder beneficiaries (children) without going through probate.
13. In a real estate closing, the proration of property taxes between buyer and seller is
typically calculated based on which of the following?
A. The seller's original purchase price
B. The number of days each party owns the property during the tax year
C. The assessed value of the property only
D. The broker's commission percentage
Correct Answer: B
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