MA Real Estate Exam Practice Q's with
Complete Answers
Mikey lists Rebecca's home by verbal agreement. Since they are friends, he accepts
her verbal exclusive listing as sufficient and doesn't worry about getting in writing.
Days later, she also lists her home with a competing brokerage. Her action was: -
ANSWER-Permissible because the listing is an open listing - verbal listing
agreements are always open listings - must get in writing to make it an exclusive
listing agreement
A P&S contract states that if the seller doesn't fix title issues on a property within 30
days, they will be required to pay the buyer $1,000 for each additional day that the
closing is delayed due to this issue. This is an example of: - ANSWER-Liquidated
damages - pre-agreed upon damages in the event of a breach of contract
A P&S that is signed by both buyer and seller is considered: - ANSWER-Executory -
status given to contracts that have not yet been finished; only considered executed
once all terms and conditions have been met, such as closing day
A lease where a tenant pays a fixed rent, along with the units heat, hot water, and
electricity costs is a : - ANSWER-Gross lease
Signing a lease to rent space for a vet clinic- lease states that you'll be paying
$4,000/mo in rent and will be responsible for a portion of property taxes, estimated to
be about $15,000/ yr. Example of which type of lease? - ANSWER-Net lease - very
common type of commercial lease
A standard policy of title insurance would not insure a homebuyer against: -
ANSWER-A recorded easement in gross (protects against undiscovered or
undiscoverable title defects)
A subdivision is described with a: - ANSWER-Plat map - or plat plan, used to
describe the proposed or actual use of a subdivision ; uses the lot and block method
Real estate developer owns 5 acres of land. Wants to build as many homes as
possible; local zoning law requires a min lot size of 75' by 75' - how many homes can
he build given the min lot size? - ANSWER-38 : acre = 43,560 sq ft...5*43560=
217,800 buildable sq ft; each lot: 75x75 = 5625 sq ft; 217800/5625 = 38 lots (round
down)
Sam wants to list her property for sale, stops by many real estate offices to
determine whether or not to list with them. All of the offices offer same commission
rate of 5% non negotiable - is this likely allowed? - ANSWER-No, this would be
illegal !! Sherman anti-trust act encourage competition
, Max wants to sell property and make $200,000 profit while paying listing agent 6%
commission; what should list price be? - ANSWER-$200,000/0.94 (Max's percent of
sale)= $212,766
Dual agents do not owe their clients undivided: - ANSWER-Loyalty
J purchased a property in 1967 for $45,000. Because of changes in real estate value
in the area, he expects to sell the property this year for $367,000. Why does he
expect this? - ANSWER-Anticipation - the anticipated benefit of real estate
ownership
What is the economic life of commercial real estate? - ANSWER-39 years
Residential properties are depreciated on a ( ) year schedule - ANSWER-27.5 year
Bens wants to buy home that costs $250,000. He has a 5% down payment and the
lender charges 1 point to originate the loan. How much will he need upfront? -
ANSWER-$14,875 - points are 1% of the loan amt, not the purchase price, FIRST
what is loan amt: 5% of 250k is $12,500. 250,000-12,500= $237,500 loan total.
NEXT 1% of $237,500 is $2,375. Answer TOTAL: 12500 + 2375 = $14,875
Which of the following is not one of the ways the US Dept of Treasury can raise
money to pay for government operations? - ANSWER-Raise the Federal Funds Rate
- only the federal reserve bank has control of raising FFR
What are all types of seller financing? - ANSWER-Purchase Money Mortgage and
Wraparound Mortgage
What is the difference between these loans: fully amortized loan of $325,000 for 20
yrs at 6% and fully amortized loan of $400,000 for 30 yrs at 5% (using amortization
table) - ANSWER-(7.16(from table) * 325,000/1000) - (5.37 * 400,000/1000) = 2327 -
2148 = $179
A home is contaminated by radon. Which is true? - ANSWER-The home can be sold,
but radon must be disclosed
Darnel selling house with septic tank that passed inspection one year ago. What
needs to be done at this point when transferring house to buyer? - ANSWER-
Nothing needs to be done at this time - in compliance with Title V, needs to pass
inspection within 2 yrs of the sale or pass inspection within 6 months of the sale
Which is mandatory for some real estate sales in MA? - ANSWER-A 6D certificate -
mandatory doc for condo sales in MA
From whom may a licensed salesperson receive compensation or commission? -
ANSWER-Employing broker
Salesperson notices ceiling leak but just paints over and doesn't disclose....new
owner has problem, if new owner wants to file a chapter 93A claim to receive
Complete Answers
Mikey lists Rebecca's home by verbal agreement. Since they are friends, he accepts
her verbal exclusive listing as sufficient and doesn't worry about getting in writing.
Days later, she also lists her home with a competing brokerage. Her action was: -
ANSWER-Permissible because the listing is an open listing - verbal listing
agreements are always open listings - must get in writing to make it an exclusive
listing agreement
A P&S contract states that if the seller doesn't fix title issues on a property within 30
days, they will be required to pay the buyer $1,000 for each additional day that the
closing is delayed due to this issue. This is an example of: - ANSWER-Liquidated
damages - pre-agreed upon damages in the event of a breach of contract
A P&S that is signed by both buyer and seller is considered: - ANSWER-Executory -
status given to contracts that have not yet been finished; only considered executed
once all terms and conditions have been met, such as closing day
A lease where a tenant pays a fixed rent, along with the units heat, hot water, and
electricity costs is a : - ANSWER-Gross lease
Signing a lease to rent space for a vet clinic- lease states that you'll be paying
$4,000/mo in rent and will be responsible for a portion of property taxes, estimated to
be about $15,000/ yr. Example of which type of lease? - ANSWER-Net lease - very
common type of commercial lease
A standard policy of title insurance would not insure a homebuyer against: -
ANSWER-A recorded easement in gross (protects against undiscovered or
undiscoverable title defects)
A subdivision is described with a: - ANSWER-Plat map - or plat plan, used to
describe the proposed or actual use of a subdivision ; uses the lot and block method
Real estate developer owns 5 acres of land. Wants to build as many homes as
possible; local zoning law requires a min lot size of 75' by 75' - how many homes can
he build given the min lot size? - ANSWER-38 : acre = 43,560 sq ft...5*43560=
217,800 buildable sq ft; each lot: 75x75 = 5625 sq ft; 217800/5625 = 38 lots (round
down)
Sam wants to list her property for sale, stops by many real estate offices to
determine whether or not to list with them. All of the offices offer same commission
rate of 5% non negotiable - is this likely allowed? - ANSWER-No, this would be
illegal !! Sherman anti-trust act encourage competition
, Max wants to sell property and make $200,000 profit while paying listing agent 6%
commission; what should list price be? - ANSWER-$200,000/0.94 (Max's percent of
sale)= $212,766
Dual agents do not owe their clients undivided: - ANSWER-Loyalty
J purchased a property in 1967 for $45,000. Because of changes in real estate value
in the area, he expects to sell the property this year for $367,000. Why does he
expect this? - ANSWER-Anticipation - the anticipated benefit of real estate
ownership
What is the economic life of commercial real estate? - ANSWER-39 years
Residential properties are depreciated on a ( ) year schedule - ANSWER-27.5 year
Bens wants to buy home that costs $250,000. He has a 5% down payment and the
lender charges 1 point to originate the loan. How much will he need upfront? -
ANSWER-$14,875 - points are 1% of the loan amt, not the purchase price, FIRST
what is loan amt: 5% of 250k is $12,500. 250,000-12,500= $237,500 loan total.
NEXT 1% of $237,500 is $2,375. Answer TOTAL: 12500 + 2375 = $14,875
Which of the following is not one of the ways the US Dept of Treasury can raise
money to pay for government operations? - ANSWER-Raise the Federal Funds Rate
- only the federal reserve bank has control of raising FFR
What are all types of seller financing? - ANSWER-Purchase Money Mortgage and
Wraparound Mortgage
What is the difference between these loans: fully amortized loan of $325,000 for 20
yrs at 6% and fully amortized loan of $400,000 for 30 yrs at 5% (using amortization
table) - ANSWER-(7.16(from table) * 325,000/1000) - (5.37 * 400,000/1000) = 2327 -
2148 = $179
A home is contaminated by radon. Which is true? - ANSWER-The home can be sold,
but radon must be disclosed
Darnel selling house with septic tank that passed inspection one year ago. What
needs to be done at this point when transferring house to buyer? - ANSWER-
Nothing needs to be done at this time - in compliance with Title V, needs to pass
inspection within 2 yrs of the sale or pass inspection within 6 months of the sale
Which is mandatory for some real estate sales in MA? - ANSWER-A 6D certificate -
mandatory doc for condo sales in MA
From whom may a licensed salesperson receive compensation or commission? -
ANSWER-Employing broker
Salesperson notices ceiling leak but just paints over and doesn't disclose....new
owner has problem, if new owner wants to file a chapter 93A claim to receive
