NEW JERSEY REAL ESTATE EXAM #1 – PRACTICE
QUESTIONS AND ANSWERS, NJ, 2026 – EXAM
PREPARATION MATERIAL
1. A real estate licensee has a buyer agency agreement. What is the seller in this
situation?
A. a customer
B. a client
C. a fiduciary
D. an agent - correct answer -A. There's an important distinction between client and
customer. Unless there is a specific agreement to the contrary, licensees represent only
one side in a transaction. In this case, it's the buyer who is the client and it's the
licensee's obligation to negotiate a deal that's in that person's best interests, not the one
that's "fairest" to both parties.
2. An optionor and an optionee make a contract for an option on a commercial piece of
property. If the optionee decides to exercise his option, when must he perform?
A. He must exercise his option within 6 months under state law.
B. He must exercise his option under the terms of the option contract.
C. He must exercise his option when the optionor demands it.
,D. He can exercise his option whenever he wants. - correct answer -B. Options are
generally concerned with only two things: time and price. Whatever the parties agree to
in those regards defines the terms of the option and the obligations of the parties.
3. When can a landlord evict a disabled blind or disabled tenant from the premises?
A. If the tenant gets a dog and the apartment policy does not allow pets
B. If the tenant insists on a handicapped parking place
C. If the tenant makes modifications to his unit at his expense
D. If the tenant has loud parties and makes too much noise - correct answer -D. The law
requires "reasonable accommodation"--for example, allowing a guide dog for a blind
person even if there's a "no pets" policy. However, that does not mean that all rules are
suspended. Noise, safety, and "use of premises policies" may still be enforced.
4. Broker Carr, with ABC Real Estate Company, listed the property with a seller. Broker
Smith, with XYZ Real Estate Company, called Broker Carr, and disclosed that he was a
Buyer Agent. Broker Smith wrote a contract with a buyer for the sale of the property.
What, if any, is the relationship between the buyer's broker, the seller and the listing
broker?
A. There is not a relationship between the parties. Broker Carr represents the Seller and
Broker Smith represents the Buyer.
B. customer
C. agency
D. dual agency - correct answer -A. Since each broker represents separate sides in the
transaction, no relationship exists.
5. A buyer bought a property without telling the seller of his intended purpose for the
property. The contract contains no contingency clauses and it is a properly executed
,contract. After the closing, the buyer is unable to obtain the zoning he needs for his
commercial project. What is the contract at this stage?
A. void
B. voidable
C. breach
D. enforceable - correct answer -D. Since there were no contingency clauses, and no
restrictive covenants of record. If the buyer cannot secure a change of zoning , the
contract is perfectly valid as stands and is enforceable between the parties.
6. The seller and the buyer finally agreed to a purchase price of $203,500 with the
closing to occur on June 15, 2011. The taxes for the year 2011 in the amount of $2,500
have not been paid by the seller. (Taxes are paid in arrears). How much would the tax
proration amount to, and how would it appear on a full settlement statement? Base
your answer on a 365 day year, and the buyer is responsible for the day of settlement.
A. $1,130.14 debit the seller and credit the buyer
B. $1,130.14 debit the buyer and credit the seller
C. $2,500 credit the seller and debit the buyer
D. Nothing. The seller does not owe since the buyer is buying - correct answer -A. The
seller would owe money, and the buyer would receive money, because the seller has
not paid the taxes. $2,500 divided by 365 is $6.849315 times the actual days of 165 is
$1,130.14.
7. A seller listed his home for six months on February 26. On April 29, a buyer made an
offer on the property. The listing broker presented the offer to the seller on April 30. The
seller accepted the offer on May 1, with the closing to occur on June 15. Assuming the
closing took place on June 15, when did the listing expire?
A. 26-May-04
, B. 15-Jun-04
C. 26-Aug-04
D. 15-Dec-04 - correct answer -B. Listing contracts set forth the terms and conditions
under which a broker will sell a property for his or her client. When the closing takes
place, the terms of the contract have been fulfilled and it expires automatically.
8. sThe ssellers slisted stheir sproperty sfor ssix smonths son sFebruary s26 sfor s$104,500. sThey
sagreed sto spay sthe slisting sbroker sa s7% scommission sat sclosing son sthe sagreed supon ssale
sprice. sA sbuyer smade san soffer son sthe sproperty son sMarch s29 sfor s$102,000. sThe sseller
scountered sthe soffer son sApril s1 sat s$103,500, sand sthe sbuyer saccepted sthe scounter soffer
swith sthe sclosing sto soccur son sJune s15. sHow smuch scommission sdid sthe sseller sowe sthe
slisting sbroker, sand show swould sit sappear son sthe ssettlement sstatement? s
s
A. s$3,622.50. sDebit sthe sseller. s
B. s$7,140. sCredit sthe sseller. s
C. s$7,315. sDebit sthe sseller. s
D. s$7,245. sDebit sthe sseller. s- scorrect s sanswer s-D. sCommissions sare spaid sbased son sthe
sactual sselling sprice, snot sthe slisting sprice. sAdditionally, ssince sthe sbroker srepresented sthe
ssellers sin sthis stransaction, sthe scommission sis sdebited sfrom stheir sside sof sthe sledger.
9. sThe sseller sand sthe sbuyer sagreed sto sa spurchase sprice sof s$103,500 swith sthe sclosing sto
soccur son sJune s15. sThe sseller's sloan sbalance safter sthe sJune s1 spayment swas s$39,440. swith
san sinterest srate sof s10%.The smonthly spayment swas s$440 sprincipal sand sinterest. sWhat
swas sthe sloan sbalance sthe sday sof sclosing, sand show smuch sinterest sdid sthe sseller sowe sthe
sbank? s
s
A. sloan sbalance s$39,440; sinterest sdue s$10,350 s
B. sloan sbalance s$39,000; sinterest sdue s$3,944 s
C. sloan sbalance s$39,000; sinterest sdue s$862.50 s
D. sloan sbalance s$39,440; sinterest sdue s$164.33 s- scorrect s sanswer s-D. sAlthough smany
stypes sof sloans scan sbecome smore scomplex sin stheir scalculations sof sremaining sprincipal
QUESTIONS AND ANSWERS, NJ, 2026 – EXAM
PREPARATION MATERIAL
1. A real estate licensee has a buyer agency agreement. What is the seller in this
situation?
A. a customer
B. a client
C. a fiduciary
D. an agent - correct answer -A. There's an important distinction between client and
customer. Unless there is a specific agreement to the contrary, licensees represent only
one side in a transaction. In this case, it's the buyer who is the client and it's the
licensee's obligation to negotiate a deal that's in that person's best interests, not the one
that's "fairest" to both parties.
2. An optionor and an optionee make a contract for an option on a commercial piece of
property. If the optionee decides to exercise his option, when must he perform?
A. He must exercise his option within 6 months under state law.
B. He must exercise his option under the terms of the option contract.
C. He must exercise his option when the optionor demands it.
,D. He can exercise his option whenever he wants. - correct answer -B. Options are
generally concerned with only two things: time and price. Whatever the parties agree to
in those regards defines the terms of the option and the obligations of the parties.
3. When can a landlord evict a disabled blind or disabled tenant from the premises?
A. If the tenant gets a dog and the apartment policy does not allow pets
B. If the tenant insists on a handicapped parking place
C. If the tenant makes modifications to his unit at his expense
D. If the tenant has loud parties and makes too much noise - correct answer -D. The law
requires "reasonable accommodation"--for example, allowing a guide dog for a blind
person even if there's a "no pets" policy. However, that does not mean that all rules are
suspended. Noise, safety, and "use of premises policies" may still be enforced.
4. Broker Carr, with ABC Real Estate Company, listed the property with a seller. Broker
Smith, with XYZ Real Estate Company, called Broker Carr, and disclosed that he was a
Buyer Agent. Broker Smith wrote a contract with a buyer for the sale of the property.
What, if any, is the relationship between the buyer's broker, the seller and the listing
broker?
A. There is not a relationship between the parties. Broker Carr represents the Seller and
Broker Smith represents the Buyer.
B. customer
C. agency
D. dual agency - correct answer -A. Since each broker represents separate sides in the
transaction, no relationship exists.
5. A buyer bought a property without telling the seller of his intended purpose for the
property. The contract contains no contingency clauses and it is a properly executed
,contract. After the closing, the buyer is unable to obtain the zoning he needs for his
commercial project. What is the contract at this stage?
A. void
B. voidable
C. breach
D. enforceable - correct answer -D. Since there were no contingency clauses, and no
restrictive covenants of record. If the buyer cannot secure a change of zoning , the
contract is perfectly valid as stands and is enforceable between the parties.
6. The seller and the buyer finally agreed to a purchase price of $203,500 with the
closing to occur on June 15, 2011. The taxes for the year 2011 in the amount of $2,500
have not been paid by the seller. (Taxes are paid in arrears). How much would the tax
proration amount to, and how would it appear on a full settlement statement? Base
your answer on a 365 day year, and the buyer is responsible for the day of settlement.
A. $1,130.14 debit the seller and credit the buyer
B. $1,130.14 debit the buyer and credit the seller
C. $2,500 credit the seller and debit the buyer
D. Nothing. The seller does not owe since the buyer is buying - correct answer -A. The
seller would owe money, and the buyer would receive money, because the seller has
not paid the taxes. $2,500 divided by 365 is $6.849315 times the actual days of 165 is
$1,130.14.
7. A seller listed his home for six months on February 26. On April 29, a buyer made an
offer on the property. The listing broker presented the offer to the seller on April 30. The
seller accepted the offer on May 1, with the closing to occur on June 15. Assuming the
closing took place on June 15, when did the listing expire?
A. 26-May-04
, B. 15-Jun-04
C. 26-Aug-04
D. 15-Dec-04 - correct answer -B. Listing contracts set forth the terms and conditions
under which a broker will sell a property for his or her client. When the closing takes
place, the terms of the contract have been fulfilled and it expires automatically.
8. sThe ssellers slisted stheir sproperty sfor ssix smonths son sFebruary s26 sfor s$104,500. sThey
sagreed sto spay sthe slisting sbroker sa s7% scommission sat sclosing son sthe sagreed supon ssale
sprice. sA sbuyer smade san soffer son sthe sproperty son sMarch s29 sfor s$102,000. sThe sseller
scountered sthe soffer son sApril s1 sat s$103,500, sand sthe sbuyer saccepted sthe scounter soffer
swith sthe sclosing sto soccur son sJune s15. sHow smuch scommission sdid sthe sseller sowe sthe
slisting sbroker, sand show swould sit sappear son sthe ssettlement sstatement? s
s
A. s$3,622.50. sDebit sthe sseller. s
B. s$7,140. sCredit sthe sseller. s
C. s$7,315. sDebit sthe sseller. s
D. s$7,245. sDebit sthe sseller. s- scorrect s sanswer s-D. sCommissions sare spaid sbased son sthe
sactual sselling sprice, snot sthe slisting sprice. sAdditionally, ssince sthe sbroker srepresented sthe
ssellers sin sthis stransaction, sthe scommission sis sdebited sfrom stheir sside sof sthe sledger.
9. sThe sseller sand sthe sbuyer sagreed sto sa spurchase sprice sof s$103,500 swith sthe sclosing sto
soccur son sJune s15. sThe sseller's sloan sbalance safter sthe sJune s1 spayment swas s$39,440. swith
san sinterest srate sof s10%.The smonthly spayment swas s$440 sprincipal sand sinterest. sWhat
swas sthe sloan sbalance sthe sday sof sclosing, sand show smuch sinterest sdid sthe sseller sowe sthe
sbank? s
s
A. sloan sbalance s$39,440; sinterest sdue s$10,350 s
B. sloan sbalance s$39,000; sinterest sdue s$3,944 s
C. sloan sbalance s$39,000; sinterest sdue s$862.50 s
D. sloan sbalance s$39,440; sinterest sdue s$164.33 s- scorrect s sanswer s-D. sAlthough smany
stypes sof sloans scan sbecome smore scomplex sin stheir scalculations sof sremaining sprincipal
