PSI NJ Real Estate Exam, PSI Practice
questions with correct answers
Water Rights - correct 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 - correct answer>> an agent to the broker and a subagent to the principal.
Depreciation is calculated based on the - correct 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 - correct answer>> mortgagor
A competitive market analysis is MOST often used for - correct answer>> setting a listing price
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 - correct answer>> tell the seller not to
disclose, because the statute of limitations has run out.
All of the following are methods to calculate the reproduction or replacement cost of a building EXCEPT
the - correct answer>> straight-line method
The buyer is assuming a mortgage presently on the property in the amount of $110,000. What is the
adjustment made at closing? - correct answer>> Credit buyer $110,000; debit seller $110,000.
If conditions for purchase are included in a deed and these conditions are violated, what is the penalty?
- correct answer>> Return of the property to the original owner.
The purpose of requiring an earnest money deposit in a real estate sales contract is to - correct
answer>> provide evidence of the buyer's intention to carry out the contract.
,A judgment has been properly recorded. Any subsequent purchasers, whether they have actually
examined the record or not, have been given - correct answer>> constructive notice
What type of map is MOST useful for describing the terrain of a very hilly lot? - correct answer>>
contour map
The Department of Housing and Urban Development estimates that most private homes built before
1978 contain potentially dangerous levels of lead. Because of this, some Federal agencies, such as FHA, -
correct answer>> Require the buyer to acknowledge disclosure of the presence of any known lead paint.
At the time of listing, the seller tells the listing agent they are moving because the neighbor has loud
parties every weekend. The agent should - correct answer>> tell potential buyers about the parties. (Any
social information expressed to an agent can be shared)
A major reason for buying and owning a condominium rather than a detached single-family home is that
- correct answer>> a condominium tends to be more affordable.
A buyer was negotiating the purchase of a house for himself. During a conversation with the seller, the
seller agreed to include all kitchen appliances in the sale, and this fact was included in the sales contract.
In this situation, if the seller takes the appliances with him, what recourse does the buyer have? -
correct answer>> The buyer may sue the seller for specific performance.
A loan which requires the borrower to pay interest only until the maturity date (or due date), and then
to pay the entire principal on the maturity date, is called a - correct answer>> straight (term) loan (AKA
term loan)
The real estate contract for a specific property for use as an unlicensed whiskey sales operation was
forced to terminate. The termination was the result of - correct answer>> Impossibility of performance.
- - (Key word: *Unlicensed* whiskey sales operation).
A broker lists a property, with a listing contract allowing subagency and dual agency. One of the broker's
salespersons shows the property. The salesperson would be classified as - correct answer>> a subagent
of the seller. — (Think - brokerage is the AGENCY, salesperson is working under the agency)
, The relationship in which the agent is placed in the position of trust and confidence to the principal is
known by the term - correct answer>> fiduciary
An agreement to purchase that has NOT yet closed is - correct answer>> an executory contract.
When compiling a competitive market analysis, a broker would look for comparable properties that -
correct answer>> were located near the property being listed.
The power vested in the government to establish legislation to preserve order, protect the public health
and safety, and promote the general welfare is known as - correct answer>> police power
If a borrower can afford to make monthly principal and interest payments of $1,000 and the lender will
make a 30-year loan at 8-1/2%, how large a loan (rounded to the nearest $100) can this buyer afford?
(BE SURE TO USE THE AMORTIZATION TABLE.) - correct answer>> $130,000
An Environmental Impact Statement (EIS) - correct answer>> projects the impact on the environment of
a proposed project.
In an exclusive right-to-sell listing, an owner lists the property for sale with how many brokers? - correct
answer>> One
A prospective buyer made an offer to purchase a property. The owner responded with a counteroffer.
While the buyer was reviewing the counteroffer, the owner received a better offer. The owner can
accept the second offer if - correct answer>> the owner withdraws the counteroffer before it is
accepted.
Antitrust laws prohibit competing brokers from all of the following EXCEPT - correct answer>> receiving
compensation from both the buyer and the seller.
Without checking the facts, a broker who is the seller's agent tells a buyer that the property taxes in a
particular neighborhood are among the lowest in the area. The buyer relies on the broker's statement
and makes an offer on a house in the neighborhood. Before closing, it is determined that the taxes are
questions with correct answers
Water Rights - correct 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 - correct answer>> an agent to the broker and a subagent to the principal.
Depreciation is calculated based on the - correct 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 - correct answer>> mortgagor
A competitive market analysis is MOST often used for - correct answer>> setting a listing price
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 - correct answer>> tell the seller not to
disclose, because the statute of limitations has run out.
All of the following are methods to calculate the reproduction or replacement cost of a building EXCEPT
the - correct answer>> straight-line method
The buyer is assuming a mortgage presently on the property in the amount of $110,000. What is the
adjustment made at closing? - correct answer>> Credit buyer $110,000; debit seller $110,000.
If conditions for purchase are included in a deed and these conditions are violated, what is the penalty?
- correct answer>> Return of the property to the original owner.
The purpose of requiring an earnest money deposit in a real estate sales contract is to - correct
answer>> provide evidence of the buyer's intention to carry out the contract.
,A judgment has been properly recorded. Any subsequent purchasers, whether they have actually
examined the record or not, have been given - correct answer>> constructive notice
What type of map is MOST useful for describing the terrain of a very hilly lot? - correct answer>>
contour map
The Department of Housing and Urban Development estimates that most private homes built before
1978 contain potentially dangerous levels of lead. Because of this, some Federal agencies, such as FHA, -
correct answer>> Require the buyer to acknowledge disclosure of the presence of any known lead paint.
At the time of listing, the seller tells the listing agent they are moving because the neighbor has loud
parties every weekend. The agent should - correct answer>> tell potential buyers about the parties. (Any
social information expressed to an agent can be shared)
A major reason for buying and owning a condominium rather than a detached single-family home is that
- correct answer>> a condominium tends to be more affordable.
A buyer was negotiating the purchase of a house for himself. During a conversation with the seller, the
seller agreed to include all kitchen appliances in the sale, and this fact was included in the sales contract.
In this situation, if the seller takes the appliances with him, what recourse does the buyer have? -
correct answer>> The buyer may sue the seller for specific performance.
A loan which requires the borrower to pay interest only until the maturity date (or due date), and then
to pay the entire principal on the maturity date, is called a - correct answer>> straight (term) loan (AKA
term loan)
The real estate contract for a specific property for use as an unlicensed whiskey sales operation was
forced to terminate. The termination was the result of - correct answer>> Impossibility of performance.
- - (Key word: *Unlicensed* whiskey sales operation).
A broker lists a property, with a listing contract allowing subagency and dual agency. One of the broker's
salespersons shows the property. The salesperson would be classified as - correct answer>> a subagent
of the seller. — (Think - brokerage is the AGENCY, salesperson is working under the agency)
, The relationship in which the agent is placed in the position of trust and confidence to the principal is
known by the term - correct answer>> fiduciary
An agreement to purchase that has NOT yet closed is - correct answer>> an executory contract.
When compiling a competitive market analysis, a broker would look for comparable properties that -
correct answer>> were located near the property being listed.
The power vested in the government to establish legislation to preserve order, protect the public health
and safety, and promote the general welfare is known as - correct answer>> police power
If a borrower can afford to make monthly principal and interest payments of $1,000 and the lender will
make a 30-year loan at 8-1/2%, how large a loan (rounded to the nearest $100) can this buyer afford?
(BE SURE TO USE THE AMORTIZATION TABLE.) - correct answer>> $130,000
An Environmental Impact Statement (EIS) - correct answer>> projects the impact on the environment of
a proposed project.
In an exclusive right-to-sell listing, an owner lists the property for sale with how many brokers? - correct
answer>> One
A prospective buyer made an offer to purchase a property. The owner responded with a counteroffer.
While the buyer was reviewing the counteroffer, the owner received a better offer. The owner can
accept the second offer if - correct answer>> the owner withdraws the counteroffer before it is
accepted.
Antitrust laws prohibit competing brokers from all of the following EXCEPT - correct answer>> receiving
compensation from both the buyer and the seller.
Without checking the facts, a broker who is the seller's agent tells a buyer that the property taxes in a
particular neighborhood are among the lowest in the area. The buyer relies on the broker's statement
and makes an offer on a house in the neighborhood. Before closing, it is determined that the taxes are
