PSI NJ REAL ESTATE PRACTICE QUESTIONS AND
ANSWERS NEWLY MODIFIED TESTED AND
APPROVED!!!
All of the following are methods to calculate the reproduction or replacement cost of a
building EXCEPT the
a. quantity survey method
b. unit-in-place method
c. square foot method
d. straight-line method -- ANSWER--straight-line method
Which of the following statements about discount points is FALSE?
a. they are computed as a percentage of the selling price
b. they are used to buy down interest rate
c. they are a function of the marketplace
d. they are paid by either the buyer or the seller -- ANSWER--they are computed as a
percentage of the selling price
The Equal Credit Opportunity Act addresses all of the following EXCEPT
a. discrimination in lending
b. written statements of credit denial
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,c. acceptable factors for borrower analysis
d. standardization of interest rates -- ANSWER--standardization of interest rates
A seller tells the listing agent that her home was treated for termites 10 years ago, so there are
no termites now. Before listing the property, the agent should
a. tell the seller not to disclose, because the statute of limitations has run out
b. tell the seller to disclose the termite treatment on the property disclosure
c. talk to neighbors to see if there are termites in the neighborhood
d. talk to the planning and zoning department for local termite eradication ordinance --
ANSWER--tell the seller to disclose the termite treatment on the property disclosure
The buyer is assuming a mortgage presently on the property in the amount of $110,000. What
is the adjustment made at closing?
a. credit buyer $110,000, debit seller $110,000
b. credit seller $110,000, debit buyer $110,000
c. credit buyer $110,000, no adjustment to seller
d. credit seller $110,000, no adjustment to buyer -- ANSWER--credit buyer $110,000, debit
seller $110,000
A broker has signed a listing contract for the sale of a home. Which of the following could
make this contract voidable?
a. The seller cannot write and sign with an "X".
b. The listing contract specifies that no other broker may show the house.
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,c. The seller is heavily under the influence of alcohol at the time of signing.
d. The listing contract specifies that a commission will be paid only if the house is sold within
3 weeks. -- ANSWER--The seller is heavily under the influence of alcohol at the time of
signing.
Which of the following statements about discount points is FALSE?
1.) They are computed as a percentage of the selling price.
2.) They are used to buy down interest rate.
3.) They are a function of the marketplace.
4.) They are paid by either the buyer or the seller. -- ANSWER--They are computed as a
percentage of the selling price.
An owner lists her home at a 7% commission rate and wants to net $45,000 after paying the
mortgage balance of $68,000 and the broker's commission. To the nearest dollar, what should
the selling price be to net her $45,000?
1.)$105,090.
2.) $110,753.
3.) $120,910.
4) None of the above. -- ANSWER--None of the above.
When preparing a market data estimate of value, which of the following categories of
adjustment is NOT essential?
a. the amount of square footage
b. the location of the property
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, c. the original cost of the building
d. the date of sale of the comparables -- ANSWER--the original cost of the building
At the closing on June 15, the buyer is assuming a mortgage presently on the property, on
which the monthly interest charge is currently $600. The seller has made the payment due on
June 1. Assuming a VA mortgage, what is the adjustment made at closing?
a. credit seller $300, credit buyer $300
b. debit seller $300, debit buyer $300
c. credit seller $300, debit buyer $300
d. debit seller $300, credit buyer $300 -- ANSWER--debit seller $300, credit buyer $300
Water Rights -- ANSWER--The terms "littoral," "riparian," and "appropriative" refer to
A salesperson lists a property with a contract that allows for subagency and dual agency. The
salesperson is -- ANSWER--an agent to the broker and a subagent to the principal.
Depreciation is calculated based on the -- ANSWER--Cost of the building only.
When a property owner uses his home as collateral for a loan and creates a lien in favor of the
lender, title is held by the -- ANSWER--mortgagor
A competitive market analysis is MOST often used for -- ANSWER--setting a listing price
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ANSWERS NEWLY MODIFIED TESTED AND
APPROVED!!!
All of the following are methods to calculate the reproduction or replacement cost of a
building EXCEPT the
a. quantity survey method
b. unit-in-place method
c. square foot method
d. straight-line method -- ANSWER--straight-line method
Which of the following statements about discount points is FALSE?
a. they are computed as a percentage of the selling price
b. they are used to buy down interest rate
c. they are a function of the marketplace
d. they are paid by either the buyer or the seller -- ANSWER--they are computed as a
percentage of the selling price
The Equal Credit Opportunity Act addresses all of the following EXCEPT
a. discrimination in lending
b. written statements of credit denial
Page 1 of 35
,c. acceptable factors for borrower analysis
d. standardization of interest rates -- ANSWER--standardization of interest rates
A seller tells the listing agent that her home was treated for termites 10 years ago, so there are
no termites now. Before listing the property, the agent should
a. tell the seller not to disclose, because the statute of limitations has run out
b. tell the seller to disclose the termite treatment on the property disclosure
c. talk to neighbors to see if there are termites in the neighborhood
d. talk to the planning and zoning department for local termite eradication ordinance --
ANSWER--tell the seller to disclose the termite treatment on the property disclosure
The buyer is assuming a mortgage presently on the property in the amount of $110,000. What
is the adjustment made at closing?
a. credit buyer $110,000, debit seller $110,000
b. credit seller $110,000, debit buyer $110,000
c. credit buyer $110,000, no adjustment to seller
d. credit seller $110,000, no adjustment to buyer -- ANSWER--credit buyer $110,000, debit
seller $110,000
A broker has signed a listing contract for the sale of a home. Which of the following could
make this contract voidable?
a. The seller cannot write and sign with an "X".
b. The listing contract specifies that no other broker may show the house.
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,c. The seller is heavily under the influence of alcohol at the time of signing.
d. The listing contract specifies that a commission will be paid only if the house is sold within
3 weeks. -- ANSWER--The seller is heavily under the influence of alcohol at the time of
signing.
Which of the following statements about discount points is FALSE?
1.) They are computed as a percentage of the selling price.
2.) They are used to buy down interest rate.
3.) They are a function of the marketplace.
4.) They are paid by either the buyer or the seller. -- ANSWER--They are computed as a
percentage of the selling price.
An owner lists her home at a 7% commission rate and wants to net $45,000 after paying the
mortgage balance of $68,000 and the broker's commission. To the nearest dollar, what should
the selling price be to net her $45,000?
1.)$105,090.
2.) $110,753.
3.) $120,910.
4) None of the above. -- ANSWER--None of the above.
When preparing a market data estimate of value, which of the following categories of
adjustment is NOT essential?
a. the amount of square footage
b. the location of the property
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, c. the original cost of the building
d. the date of sale of the comparables -- ANSWER--the original cost of the building
At the closing on June 15, the buyer is assuming a mortgage presently on the property, on
which the monthly interest charge is currently $600. The seller has made the payment due on
June 1. Assuming a VA mortgage, what is the adjustment made at closing?
a. credit seller $300, credit buyer $300
b. debit seller $300, debit buyer $300
c. credit seller $300, debit buyer $300
d. debit seller $300, credit buyer $300 -- ANSWER--debit seller $300, credit buyer $300
Water Rights -- ANSWER--The terms "littoral," "riparian," and "appropriative" refer to
A salesperson lists a property with a contract that allows for subagency and dual agency. The
salesperson is -- ANSWER--an agent to the broker and a subagent to the principal.
Depreciation is calculated based on the -- ANSWER--Cost of the building only.
When a property owner uses his home as collateral for a loan and creates a lien in favor of the
lender, title is held by the -- ANSWER--mortgagor
A competitive market analysis is MOST often used for -- ANSWER--setting a listing price
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