PSI NJ Real Estate Exam, PSI Practice Test
PSI NJ REAL ESTATE EXAM, PSI PRACTICE TEST NEWEST 2025/2026
ACTUAL EXAM COMPLETE 100 QUESTIONS AND CORRECT DETAILED
ANSWERS (VERIFIED ANSWERS) |ALREADY GRADED A+
According to the Truth-in-Lending Act, if any "trigger terms" are used in an ad, all
of the following disclosures MUST appear in the ad EXCEPT the
a. cash price or amount of the loan
b. amount of down payment required
c. number, amount, and frequency of payments
d. prepayment penalties and rebates - ANSWER-prepayment penalties and
rebates
An agent shows a home to a couple and mentions that it has a lovely fireplace in
the living room. After buying the home, the buyers and agent discover that the
brick fireplace is just a decorative fireplace and is not "wood burning." What
would BEST protect the agent from financial loss?
a. the state recovery fund
b. E&O coverage
c. homeowner warranty insurance
d. a business pursuits endorsement on the agent's homeowners insurance policy -
ANSWER-E&O coverage
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
c. the original cost of the building
1|Page
, PSI NJ Real Estate Exam, PSI Practice Test
d. the date of sale of the comparables - ANSWER-the original cost of the building
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
If all other factors are equal, in which location is a parking lot likely to bring the
highest sales price? - ANSWER-business district zoned for a six-story office building
Parcels A, B, and C are located side by side and owned by three different owners.
A is worth $20,000, B is worth $27,000, and C is worth $16,000 for a total of
$63,000. A developer believes that if all three can be purchased, the larger parcel
would be worth $85,000. By assembling these under one owner they would be
worth $22,000 more than their individual values. This demonstrates which
principle of value? - ANSWER-plottage
A prospective seller asks a salesperson to recommend a listing price for a
property. The salesperson should suggest - ANSWER-a competitive market analysis
The FHA functions MOST like - ANSWER-an insurance company
2|Page
, PSI NJ Real Estate Exam, PSI Practice Test
A loan which requires the borrower to pay interest only until the maturity date (or
due date), and then pay the entire principal on the maturity date, is called a -
ANSWER-term loan
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 buyer wants to make the purchase offer contingent on a complex mortgage
arrangement. The buyer's agent who is drawing up the contract should - ANSWER-
suggest the buyer ask a lawyer to furnish the wording
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
3|Page
PSI NJ REAL ESTATE EXAM, PSI PRACTICE TEST NEWEST 2025/2026
ACTUAL EXAM COMPLETE 100 QUESTIONS AND CORRECT DETAILED
ANSWERS (VERIFIED ANSWERS) |ALREADY GRADED A+
According to the Truth-in-Lending Act, if any "trigger terms" are used in an ad, all
of the following disclosures MUST appear in the ad EXCEPT the
a. cash price or amount of the loan
b. amount of down payment required
c. number, amount, and frequency of payments
d. prepayment penalties and rebates - ANSWER-prepayment penalties and
rebates
An agent shows a home to a couple and mentions that it has a lovely fireplace in
the living room. After buying the home, the buyers and agent discover that the
brick fireplace is just a decorative fireplace and is not "wood burning." What
would BEST protect the agent from financial loss?
a. the state recovery fund
b. E&O coverage
c. homeowner warranty insurance
d. a business pursuits endorsement on the agent's homeowners insurance policy -
ANSWER-E&O coverage
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
c. the original cost of the building
1|Page
, PSI NJ Real Estate Exam, PSI Practice Test
d. the date of sale of the comparables - ANSWER-the original cost of the building
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
If all other factors are equal, in which location is a parking lot likely to bring the
highest sales price? - ANSWER-business district zoned for a six-story office building
Parcels A, B, and C are located side by side and owned by three different owners.
A is worth $20,000, B is worth $27,000, and C is worth $16,000 for a total of
$63,000. A developer believes that if all three can be purchased, the larger parcel
would be worth $85,000. By assembling these under one owner they would be
worth $22,000 more than their individual values. This demonstrates which
principle of value? - ANSWER-plottage
A prospective seller asks a salesperson to recommend a listing price for a
property. The salesperson should suggest - ANSWER-a competitive market analysis
The FHA functions MOST like - ANSWER-an insurance company
2|Page
, PSI NJ Real Estate Exam, PSI Practice Test
A loan which requires the borrower to pay interest only until the maturity date (or
due date), and then pay the entire principal on the maturity date, is called a -
ANSWER-term loan
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 buyer wants to make the purchase offer contingent on a complex mortgage
arrangement. The buyer's agent who is drawing up the contract should - ANSWER-
suggest the buyer ask a lawyer to furnish the wording
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
3|Page
