PSI NATIONAL REAL ESTATE EXAM 2026/2027 PRACTICE
QUESTIONS AND LATEST UPDATED STUDY GUIDE
COMPLETE APPROVED QUESTIONS WITH WELL
ELABORATED ANSWERS AND RATIONALES (A NEW
UPDATED VERSION 2026 EDITION) |GUARANTEED PASS A+
(BRAND NEW!) |FULL REVISED PSI NATIONAL REAL ESTATE
EXAM
1. A buyer signs a purchase agreement for a property but dies before
closing. The contract is:
A) Voidable at the seller’s option
B) Still enforceable by the buyer’s estate
C) Automatically terminated
D) Assignable to the buyer’s next of kin
Correct Answer: C (Automatically terminated) – Rationale: Personal
service or executory contracts for real estate typically terminate upon the
death of either party before closing because the buyer’s personal
obligation to perform is extinguished.
2. Which type of easement is created when a property owner explicitly
grants a neighbor the right to cross their land?
A) Easement by prescription
B) Easement by necessity
C) Express easement
D) Implied easement
Correct Answer: C (Express easement) – Rationale: An express
easement is created by a written agreement, deed, or will, clearly stating
the grantor’s permission for the grantee to use the land.
,3. A homeowner installs a fence that extends 2 feet onto a neighbor’s
property. After 12 years, the neighbor does nothing. Under adverse
possession laws (typical 10–20 years), the homeowner may gain title to
that strip of land through:
A) Equitable title
B) Prescriptive easement
C) Adverse possession
D) Eminent domain
Correct Answer: C (Adverse possession) – Rationale: If the
possession is hostile, actual, open, notorious, exclusive, and continuous
for the statutory period (often 10–20 years), the trespasser can acquire
legal title.
4. A real estate agent receives an earnest money check from a buyer. The
agent must:
A) Deposit it in the agent’s personal account until closing
B) Give it directly to the seller
C) Place it in a non-interest-bearing trust account unless otherwise
agreed
D) Cash it immediately and hold the cash
Correct Answer: C (Place it in a non-interest-bearing trust account
unless otherwise agreed) – Rationale: Most state laws require earnest
money to be held in a designated escrow or trust account, not mixed
with the agent’s or broker’s operating funds.
,5. The Truth in Lending Act (TILA) requires lenders to disclose:
A) The appraisal value of the property
B) The annual percentage rate (APR) and total finance charges
C) The buyer’s credit score
D) The property’s tax history
Correct Answer: B (The annual percentage rate (APR) and total
finance charges) – Rationale: TILA (Regulation Z) mandates that
consumers receive clear disclosure of the cost of credit, including APR,
finance charges, and total payments.
6. Which of the following is an example of puffing in real estate?
A) “This roof will last 30 years guaranteed”
B) “The square footage is 2,500 according to county records”
C) “This is the most beautiful view in the entire city”
D) “The basement has never flooded”
Correct Answer: C (“This is the most beautiful view in the entire city”)
– Rationale: Puffing is exaggerated opinion or subjective praise not
meant to be taken as fact, and it is generally not actionable as fraud.
7. A property is appraised using the sales comparison approach. Which
factor is most relevant?
A) Reproduction cost new minus depreciation
B) The property’s annual gross income multiplier
C) Recent sale prices of comparable properties
D) The assessed tax value
Correct Answer: C (Recent sale prices of comparable properties)
– Rationale: The sales comparison approach values a property by
, comparing it to similar properties recently sold in the same market after
adjustments for differences.
8. A deed must be:
A) Acknowledged before a notary to be valid between grantor and
grantee
B) Recorded to transfer title
C) In writing and delivered to the grantee
D) Approved by the county assessor
Correct Answer: C (In writing and delivered to the grantee)
– Rationale: For a deed to be valid, it must be in writing, signed by the
grantor, and delivered to and accepted by the grantee. Recording
provides notice but is not required for validity between parties.
9. An agent shows a property to a buyer without disclosing that the agent
is also the seller’s nephew. This is a violation of:
A) The ADA
B) Fair Housing Act
C) Duty of disclosure and fiduciary duty
D) RESPA
Correct Answer: C (Duty of disclosure and fiduciary duty)
– Rationale: Agents owe fiduciary duties, including disclosure of
material facts and conflicts of interest. Failing to disclose a familial
relationship with the seller is a breach.
QUESTIONS AND LATEST UPDATED STUDY GUIDE
COMPLETE APPROVED QUESTIONS WITH WELL
ELABORATED ANSWERS AND RATIONALES (A NEW
UPDATED VERSION 2026 EDITION) |GUARANTEED PASS A+
(BRAND NEW!) |FULL REVISED PSI NATIONAL REAL ESTATE
EXAM
1. A buyer signs a purchase agreement for a property but dies before
closing. The contract is:
A) Voidable at the seller’s option
B) Still enforceable by the buyer’s estate
C) Automatically terminated
D) Assignable to the buyer’s next of kin
Correct Answer: C (Automatically terminated) – Rationale: Personal
service or executory contracts for real estate typically terminate upon the
death of either party before closing because the buyer’s personal
obligation to perform is extinguished.
2. Which type of easement is created when a property owner explicitly
grants a neighbor the right to cross their land?
A) Easement by prescription
B) Easement by necessity
C) Express easement
D) Implied easement
Correct Answer: C (Express easement) – Rationale: An express
easement is created by a written agreement, deed, or will, clearly stating
the grantor’s permission for the grantee to use the land.
,3. A homeowner installs a fence that extends 2 feet onto a neighbor’s
property. After 12 years, the neighbor does nothing. Under adverse
possession laws (typical 10–20 years), the homeowner may gain title to
that strip of land through:
A) Equitable title
B) Prescriptive easement
C) Adverse possession
D) Eminent domain
Correct Answer: C (Adverse possession) – Rationale: If the
possession is hostile, actual, open, notorious, exclusive, and continuous
for the statutory period (often 10–20 years), the trespasser can acquire
legal title.
4. A real estate agent receives an earnest money check from a buyer. The
agent must:
A) Deposit it in the agent’s personal account until closing
B) Give it directly to the seller
C) Place it in a non-interest-bearing trust account unless otherwise
agreed
D) Cash it immediately and hold the cash
Correct Answer: C (Place it in a non-interest-bearing trust account
unless otherwise agreed) – Rationale: Most state laws require earnest
money to be held in a designated escrow or trust account, not mixed
with the agent’s or broker’s operating funds.
,5. The Truth in Lending Act (TILA) requires lenders to disclose:
A) The appraisal value of the property
B) The annual percentage rate (APR) and total finance charges
C) The buyer’s credit score
D) The property’s tax history
Correct Answer: B (The annual percentage rate (APR) and total
finance charges) – Rationale: TILA (Regulation Z) mandates that
consumers receive clear disclosure of the cost of credit, including APR,
finance charges, and total payments.
6. Which of the following is an example of puffing in real estate?
A) “This roof will last 30 years guaranteed”
B) “The square footage is 2,500 according to county records”
C) “This is the most beautiful view in the entire city”
D) “The basement has never flooded”
Correct Answer: C (“This is the most beautiful view in the entire city”)
– Rationale: Puffing is exaggerated opinion or subjective praise not
meant to be taken as fact, and it is generally not actionable as fraud.
7. A property is appraised using the sales comparison approach. Which
factor is most relevant?
A) Reproduction cost new minus depreciation
B) The property’s annual gross income multiplier
C) Recent sale prices of comparable properties
D) The assessed tax value
Correct Answer: C (Recent sale prices of comparable properties)
– Rationale: The sales comparison approach values a property by
, comparing it to similar properties recently sold in the same market after
adjustments for differences.
8. A deed must be:
A) Acknowledged before a notary to be valid between grantor and
grantee
B) Recorded to transfer title
C) In writing and delivered to the grantee
D) Approved by the county assessor
Correct Answer: C (In writing and delivered to the grantee)
– Rationale: For a deed to be valid, it must be in writing, signed by the
grantor, and delivered to and accepted by the grantee. Recording
provides notice but is not required for validity between parties.
9. An agent shows a property to a buyer without disclosing that the agent
is also the seller’s nephew. This is a violation of:
A) The ADA
B) Fair Housing Act
C) Duty of disclosure and fiduciary duty
D) RESPA
Correct Answer: C (Duty of disclosure and fiduciary duty)
– Rationale: Agents owe fiduciary duties, including disclosure of
material facts and conflicts of interest. Failing to disclose a familial
relationship with the seller is a breach.
