A category-5 item in a home — a built-in dishwasher bolted into the cabinetry — is disputed at closing. Under general principles, an item that was once personal property but has become permanently attached to real property is called a:

A trade fixture removable by a homeowner-seller

An owner conveys property 'to my sister for the duration of her life.' What type of estate has the sister received, and what is the grantor's retained interest called if the property returns to the grantor at her death?

A life estate; the grantor holds a reversion

A fee simple absolute; the grantor holds nothing

An estate for years; the grantor holds a remainder

A defeasible fee; the grantor holds a license

Which of the following correctly describes the format of the licensing examination that a Contracts candidate will encounter?

One hundred multiple-choice questions

An oral examination with no time limit

A written essay on contract law

For a candidate allocating study effort, which combination correctly pairs the exam's total question count with its passing score?

100 questions; pass at 75 points

100 questions; pass at 70 points

150 questions; pass at 75 points

100 questions; pass at 80 points

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PRACTICE ENGINE · FLORIDA REAL ESTATE SALES ASSOCIATE

Florida Real Estate Sales Associate Practice Exam.
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QUESTION 1 / 105Property OwnershipEasy0/0

A buyer receives a fee simple absolute estate. Which statement BEST describes the nature of this estate?

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1. A buyer receives a fee simple absolute estate. Which statement BEST describes the nature of this estate?
- A. It lasts only for the lifetime of a named individual and then ends
- B. It grants use of the property for a fixed number of years only
- C. It is the most complete form of ownership, of potentially infinite duration and inheritable, with no attached conditions that could cause forfeiture
- D. It automatically terminates if a stated condition is violated
Show answer & explanation
Answer: C
Fee simple absolute is the highest and most complete estate: it is of potentially infinite duration, freely transferable and inheritable, and is not subject to conditions that could defeat it. A life estate is measured by a life; a defeasible fee can terminate on a condition; a leasehold is for a term of years.
2. A tenant signs a lease for a stated period with a definite beginning and ending date, after which the tenancy ends without further notice. Which leasehold estate is this?
- A. An estate for years
- B. An estate at sufferance
- C. A periodic tenancy
- D. An estate at will
Show answer & explanation
Answer: A
An estate (tenancy) for years has a fixed, definite beginning and ending date and terminates automatically at the end of the term. An estate at will has no fixed term; an estate at sufferance arises when a tenant holds over wrongfully; and a periodic tenancy renews for successive periods until proper notice is given.
3. A category-5 item in a home — a built-in dishwasher bolted into the cabinetry — is disputed at closing. Under general principles, an item that was once personal property but has become permanently attached to real property is called a:
- A. Fixture
- B. A trade fixture removable by a homeowner-seller
- C. Chattel
- D. An emblement
Show answer & explanation
Answer: A
A fixture is an article that was once personal property (chattel) but has become part of the real property through permanent attachment; factors such as method of annexation, adaptation to the property, and intent of the parties determine fixture status. Chattel is movable personal property, emblements are annual crops, and trade fixtures are business-installed items applicable to commercial tenants, not the homeowner-seller scenario.
4. An owner conveys property 'to my sister for the duration of her life.' What type of estate has the sister received, and what is the grantor's retained interest called if the property returns to the grantor at her death?
- A. An estate for years; the grantor holds a remainder
- B. A defeasible fee; the grantor holds a license
- C. A fee simple absolute; the grantor holds nothing
- D. A life estate; the grantor holds a reversion
Show answer & explanation
Answer: D
An estate measured by the duration of a person's life is a life estate. When the property returns to the grantor (rather than a named third party) at the end of the measuring life, the grantor's retained future interest is a reversion. A remainder would go to a third party, not the grantor.
5. Which of the following correctly describes the format of the licensing examination that a Contracts candidate will encounter?
- A. One hundred multiple-choice questions
- B. A written essay on contract law
- C. An oral examination with no time limit
- D. Fifty true-or-false questions
Show answer & explanation
Answer: A
The examination is composed of one hundred multiple-choice questions; the Contracts material is tested in this multiple-choice format.
6. For a candidate allocating study effort, which combination correctly pairs the exam's total question count with its passing score?
- A. 150 questions; pass at 75 points
- B. 100 questions; pass at 70 points
- C. 100 questions; pass at 75 points
- D. 100 questions; pass at 80 points
Show answer & explanation
Answer: C
The exam has 100 questions and requires a grade of 75 points or higher to pass; option B is the only pairing consistent with both stated facts.
7. During a property survey, a fence built by the neighbor is discovered to extend two feet over the boundary onto the seller's lot. This unauthorized physical intrusion onto another's land is called:
- A. An encroachment
- B. A deed restriction
- C. An easement by necessity
- D. A lien
Show answer & explanation
Answer: A
An encroachment is a structure or improvement that physically intrudes onto adjoining property without permission, and it is a type of encumbrance that can affect marketability of title. An easement by necessity is a granted right of access, a deed restriction is a private limitation on use, and a lien is a monetary claim against the property.
8. A homeowner holds title to a parcel and also owns the right to fly a small drone within the airspace directly above it for photography. This right to the space above the land surface is best described as which component of real property ownership?
- A. Riparian rights
- B. Littoral rights
- C. Air rights
- D. A profit à prendre
Show answer & explanation
Answer: C
Real property ownership traditionally extends to the surface, a reasonable portion of the space above (air rights), and the ground below (subsurface rights). The space above the land is the air rights component. Riparian and littoral rights concern water boundaries, and a profit à prendre is a right to remove resources from another's land.
9. Two people take title to a property together. If one owner dies, her interest passes automatically to the surviving owner rather than to her heirs. Which characteristic of the estate makes this automatic transfer possible?
- A. A remainder interest
- B. The right of survivorship
- C. A reversionary interest
- D. The right of partition
Show answer & explanation
Answer: B
When co-ownership carries the right of survivorship, a deceased co-owner's interest passes to the surviving co-owner(s) by operation of law, bypassing probate and the decedent's heirs. Partition is a remedy to divide co-owned property; remainder and reversion are future interests, not the survivorship feature.
10. An owner grants a neighbor the right to cross her land to reach a public road, and this right is attached to and benefits the neighbor's adjoining parcel. What has been created?
- A. A license
- B. An easement appurtenant
- C. An easement in gross
- D. An encroachment
Show answer & explanation
Answer: B
An easement appurtenant benefits a particular parcel (the dominant tenement) and burdens another (the servient tenement); it runs with the land. An easement in gross benefits a person or entity rather than a parcel. A license is a revocable personal privilege, and an encroachment is an unauthorized intrusion onto another's land.
11. A married couple buys a home and takes title in a form of co-ownership available only to spouses, which includes the right of survivorship and generally prevents one spouse from conveying the property alone. This form of ownership is:
- A. Tenancy by the entirety
- B. Tenancy in common
- C. A tenancy at sufferance
- D. Ownership in severalty
Show answer & explanation
Answer: A
Tenancy by the entirety is a co-ownership form reserved for spouses; it carries the right of survivorship and generally bars one spouse from conveying or encumbering the property without the other. Tenancy in common has no survivorship and no spousal requirement, a tenancy at sufferance is a holdover leasehold, and severalty means ownership by one person alone.
12. A test-taker notes the exam lasts three and a half hours. Expressed in minutes, how long is that allowance for completing all questions, including Contracts items?
- A. 200 minutes
- B. 210 minutes
- C. 190 minutes
- D. 220 minutes
Show answer & explanation
Answer: B
Three and a half hours equals 210 minutes, the stated exam duration.
13. For a contract to be legally enforceable, it must generally contain an offer, acceptance, consideration, legal capacity of the parties, and a lawful purpose. If one party is a minor lacking legal capacity, what is the typical status of the resulting contract?
- A. It is generally voidable at the option of the party lacking capacity
- B. It converts into a lease
- C. It is automatically criminal
- D. It is always fully enforceable against both parties
Show answer & explanation
Answer: A
Legal capacity is an essential element of an enforceable contract. When a party lacks capacity, the agreement is generally voidable at that party's option rather than automatically valid or criminal.
14. A seller makes a written offer to sell property. Before the buyer accepts, the seller communicates a valid revocation to the buyer. What is the effect of that revocation on the offer?
- A. The buyer is entitled to damages for the revocation
- B. The offer remains open and must still be accepted
- C. The offer automatically becomes a binding contract
- D. The offer is terminated and can no longer be accepted
Show answer & explanation
Answer: D
An offer that is validly revoked and communicated to the offeree before acceptance is terminated; there is no longer an offer available to accept, and no contract is formed by the revocation itself.
15. A buyer responds to a seller's offer by agreeing to buy but insists on adding a materially different condition not in the original offer. Which best describes this response?
- A. An assignment of the contract
- B. A ratification of the original offer
- C. An unconditional acceptance forming a binding contract
- D. A counteroffer that rejects the original offer
Show answer & explanation
Answer: D
A purported acceptance that changes a material term is not an acceptance but a counteroffer, which operates as a rejection of the original offer and creates a new offer that the original offeror may accept or reject.
16. Two parties sign an agreement to buy and sell real property, but the agreement is never reduced to writing and the applicable rule requires certain real-estate contracts to be in writing to be enforceable. What is the most likely consequence?
- A. The contract may be unenforceable for failing to satisfy the writing requirement
- B. The contract is enforceable only against the buyer
- C. The contract automatically becomes a criminal offense
- D. The contract is enforceable because oral agreements are always sufficient
Show answer & explanation
Answer: A
Where a writing is required for a category of contract to be enforceable, an oral agreement in that category may be unenforceable even if the parties intended to be bound. This reflects the general reasoning behind writing requirements without asserting any specific statute.
17. A contract identifies a specific party who must personally perform because the performance depends on that party's unique skill. Which action is most restricted in this situation?
- A. Reading the contract before signing
- B. Delegating the personal-service performance to a third party without consent
- C. Signing the contract
- D. Keeping a copy of the contract
Show answer & explanation
Answer: B
When performance depends on a party's unique personal skill, delegating that duty to a third party without consent is generally restricted, because the other party bargained for that specific performer. The other options are ordinary, unrestricted acts.
18. One party fails to perform a material obligation under a valid contract without a legal excuse. Which term best describes this situation and its typical consequence?
- A. An offer, which invites acceptance
- B. A novation, which discharges all parties
- C. A ratification, which validates the contract
- D. A material breach, which may entitle the non-breaching party to remedies
Show answer & explanation
Answer: D
Failing to perform a material obligation without legal excuse is a material breach. The non-breaching party is generally entitled to remedies. The other terms describe unrelated contract concepts and do not fit an unexcused failure to perform.
19. A mortgage lien was recorded in 2019. In 2024 the county levies a property tax lien on the same parcel. If the property is sold to satisfy debts, how do these liens generally rank?
- A. Neither lien has priority until a court assigns one
- B. The property tax lien generally takes priority over the earlier-recorded mortgage lien
- C. The two liens share equal priority and are paid pro rata
- D. The mortgage lien has priority because it was recorded first
Show answer & explanation
Answer: B
Property tax liens and special assessments generally take priority over all other liens regardless of when they were recorded, so the later tax lien outranks the earlier mortgage lien.
20. A right-of-way benefits Parcel A, which adjoins Parcel B, and burdens Parcel B; the benefit and burden transfer automatically when either parcel is sold. This describes:
- A. An easement appurtenant, with Parcel A as the dominant tenement and Parcel B as the servient tenement
- B. A quitclaim conveyance of Parcel B
- C. A property tax lien on both parcels
- D. A life estate held by the owner of Parcel A
Show answer & explanation
Answer: A
An easement appurtenant benefits an adjoining dominant tenement (Parcel A), burdens the servient tenement (Parcel B), and runs with the land — so the benefit and burden pass on transfer. It is not an estate, a deed, or a lien.
21. A deed omits the granting clause but otherwise names the parties, contains a legal description, is in writing, and is signed by the grantor and delivered and accepted. Based on the stated requirements, what is the most defensible conclusion about its effectiveness?
- A. It is fully effective because delivery and acceptance alone suffice
- B. It is questionable because a required element — the granting clause (words of conveyance) — is missing
- C. It automatically becomes a quitclaim deed
- D. It is effective only after it is recorded
Show answer & explanation
Answer: B
An effective deed must include a granting clause (words of conveyance) among its required elements. Omitting one of the stated requirements makes the deed's effectiveness questionable. Recording addresses notice and priority, not the deed's required elements, and nothing converts it to a quitclaim.
22. An offeror decides she no longer wishes to sell and wants to withdraw her written offer. Under general contract principles, until what point may an offer be revoked?
- A. Never, once the offer is in writing
- B. Only with the offeree's written permission
- C. Only after the offeree has had 24 hours to respond
- D. Any time before acceptance is communicated
Show answer & explanation
Answer: D
An offer may be revoked any time before acceptance is communicated. Once acceptance has been communicated, a contract exists and the offer can no longer be freely revoked.
23. Under the Statute of Frauds, which of the following leases must be in writing and signed by the party to be charged in order to be enforceable?
- A. Any lease, regardless of duration
- B. Only a lease that includes an option to purchase
- C. A month-to-month lease
- D. A lease longer than one year
Show answer & explanation
Answer: D
The Statute of Frauds requires contracts for the sale of real estate, and leases longer than one year, to be in writing and signed by the party to be charged to be enforceable. A lease longer than one year therefore falls within the writing requirement.
24. A contract is missing one of the four required essential elements. Which classification correctly describes such a contract, and what does that classification mean?
- A. Voidable, meaning a party may choose to disaffirm it
- B. Executory, meaning it is awaiting performance
- C. Unenforceable, meaning it is valid but cannot be enforced in court
- D. Void, meaning it never existed legally
Show answer & explanation
Answer: D
A contract lacking a required element is void, meaning it never existed legally. A voidable contract is one a party may disaffirm, and an unenforceable contract is otherwise valid but cannot be enforced in court—neither of which fits a contract missing an essential element.
25. A borrower obtains a mortgage loan to purchase a home. Which two documents form the core of this transaction?
- A. A general warranty deed and a quitclaim deed
- B. An easement appurtenant and a granting clause
- C. A Loan Estimate and a life estate agreement
- D. A promissory note evidencing the debt and a mortgage or deed of trust that pledges the property as security
Show answer & explanation
Answer: D
A mortgage loan involves a promissory note that evidences the debt and the borrower's promise to pay, together with a mortgage or deed of trust that pledges the property as security for the loan.
26. A homeowner stops making payments on the loan. Which mortgage clause permits the lender to declare the entire unpaid balance immediately due?
- A. The liquidated damages clause
- B. The rescission clause
- C. The substitution clause
- D. The acceleration clause
Show answer & explanation
Answer: D
The acceleration clause is the provision that lets the lender declare the entire remaining balance due upon the borrower's default.
27. Which statement correctly distinguishes among the major residential loan types?
- A. VA loans are insured by the FHA, while FHA loans are guaranteed for veterans
- B. FHA loans are insured by the FHA and allow low down payments, while VA loans are guaranteed for eligible veterans and can permit no down payment
- C. Conventional loans are government-backed, while FHA and VA loans are not
- D. Conventional loans always require a government guarantee to be issued
Show answer & explanation
Answer: B
FHA loans are insured by the Federal Housing Administration and allow low down payments, while VA loans are guaranteed for eligible veterans and can permit no down payment. Conventional loans, by contrast, are not government-backed.
28. Which federal law governs federally related mortgage loans, prohibits kickbacks and unearned referral fees, and requires the Loan Estimate and Closing Disclosure?
- A. The Real Estate Settlement Procedures Act (RESPA)
- B. The Civil Rights Act of 1866
- C. The Statute of Frauds
- D. The Truth in Lending Act (TILA)
Show answer & explanation
Answer: A
RESPA governs federally related mortgage loans, prohibits kickbacks and unearned referral fees, and requires that borrowers receive the Loan Estimate and Closing Disclosure.
29. A consumer refinances the mortgage on their principal residence. Under TILA and Regulation Z, what right may apply to this transaction?
- A. A three-day right of rescission on certain refinances of a principal residence
- B. A right to demand specific performance from the lender
- C. An unconditional right to keep the earnest money as liquidated damages
- D. A right to a general warranty deed from the lender
Show answer & explanation
Answer: A
TILA, implemented by Regulation Z, grants a three-day right of rescission on certain refinances of a principal residence, allowing the borrower to cancel within that window.
30. A broker holds earnest money for a pending sale in the same operating account she uses to pay her office rent. Which fiduciary duty does this arrangement most directly violate?
- A. Obedience, because she failed to follow the seller's instructions
- B. Disclosure, because she did not tell the buyer where the funds were held
- C. Loyalty, because she profited from the transaction
- D. Accounting, because client funds must be kept in a separate trust or escrow account and never commingled with the broker's own funds
Show answer & explanation
Answer: D
The accounting duty requires depositing client funds in a separate trust or escrow account and never commingling them with the broker's own funds. Mixing earnest money with operating funds breaches that duty specifically.
31. An agent represents both the buyer and the seller in the same transaction. Under what circumstance is this permissible?
- A. Only when the informed written consent of both parties is obtained
- B. Never, under any circumstances
- C. Whenever the agent believes it will speed the closing
- D. Only when the seller alone agrees in writing
Show answer & explanation
Answer: A
Dual agency, representing both buyer and seller in the same transaction, is permitted only with the informed written consent of both parties.
32. A buyer and seller shake hands on an oral agreement to sell a home, but nothing is put in writing. A dispute later arises. How would a court most likely classify this agreement?
- A. Void, because it never legally existed
- B. Unenforceable, because the Statute of Frauds requires real estate sale contracts to be in writing and signed by the party to be charged
- C. Voidable, because either party may disaffirm it
- D. Fully enforceable, because consideration was exchanged
Show answer & explanation
Answer: B
The Statute of Frauds requires contracts for the sale of real estate to be in writing and signed by the party to be charged to be enforceable; an otherwise valid but unwritten land-sale agreement is unenforceable.
33. A parcel has a first mortgage recorded in 2015 and unpaid property taxes assessed in 2020. If the property is sold to satisfy debts, which claim generally takes priority?
- A. Whichever lienholder demands payment first
- B. The property tax lien, because tax liens generally take priority over all other liens regardless of when recorded
- C. Neither; they share equally
- D. The 2015 mortgage, because it was recorded first
Show answer & explanation
Answer: B
Property tax liens and special assessments generally take priority over all other liens regardless of when they were recorded, so the later tax lien outranks the earlier mortgage.
34. A buyer wants the maximum possible protection of title from the seller at conveyance. Which deed provides it?
- A. A quitclaim deed
- B. A life estate deed
- C. An easement deed
- D. A general warranty deed
Show answer & explanation
Answer: D
A general warranty deed offers the greatest protection because the grantor warrants title against all defects arising at any time. A quitclaim deed, by contrast, carries no warranties.
35. A grantor is willing to transfer only whatever interest, if any, she may hold in a parcel, making no promises about the state of the title. Which instrument fits this intent?
- A. A deed containing covenants of seisin, quiet enjoyment, and warranty forever
- B. A general warranty deed
- C. A quitclaim deed
- D. A recorded easement appurtenant
Show answer & explanation
Answer: C
A quitclaim deed carries no warranties and conveys only whatever interest the grantor may have — matching a grantor unwilling to warrant title. A general warranty deed does the opposite by warranting against all defects.
36. A purchase agreement states that the buyer's obligation to close depends on obtaining mortgage financing and on a satisfactory home inspection. These provisions are examples of which contract feature?
- A. Contingencies
- B. Covenants of title
- C. Liquidated damages clauses
- D. Acceleration clauses
Show answer & explanation
Answer: A
Contingencies are conditions that must be satisfied before a party is obligated to perform, commonly including financing, inspection, and appraisal contingencies. The financing and inspection conditions described are therefore contingencies.
37. An appraiser values an income-producing property by dividing its net operating income by the capitalization rate. Which approach to value is being applied?
- A. The sales comparison approach
- B. The cost approach
- C. The substitution approach
- D. The income approach
Show answer & explanation
Answer: D
The income approach capitalizes net operating income by dividing NOI by the capitalization rate, making it the approach described.
38. An exam candidate is asked which estate represents the most complete bundle of ownership rights a person can hold in real property. Which should the candidate select?
- A. A life estate
- B. A fee simple absolute
- C. An easement appurtenant
- D. A quitclaim interest
Show answer & explanation
Answer: B
The fee simple absolute is the highest and most complete form of ownership, being freely inheritable and transferable. A life estate is limited in duration, a quitclaim conveys only whatever interest exists, and an easement is a limited right in another's land.
39. A seller under a signed purchase contract refuses to convey the property, and the buyer wants a court to force the sale rather than merely awarding money. Which remedy does the buyer seek, and on what rationale is it based?
- A. Liquidated damages, because the parties agreed on a fixed sum
- B. Revocation, because acceptance was never communicated
- C. Specific performance, because land is deemed unique
- D. Rescission, because the contract is void
Show answer & explanation
Answer: C
Specific performance compels conveyance because land is deemed unique. A buyer seeking to force the actual transfer of the property—rather than accept monetary damages—pursues specific performance on that rationale.
40. On a conventional loan, a borrower pays two discount points on a $200,000 loan. How much does this represent, and what is its purpose?
- A. $20,000, as a required down payment
- B. $4,000, as prepaid interest that buys down the interest rate, since one point equals one percent of the loan amount
- C. $2,000, paid to record the mortgage
- D. $400, paid as a title insurance premium
Show answer & explanation
Answer: B
One discount point equals one percent of the loan amount and is prepaid interest that buys down the interest rate. Two points on a $200,000 loan is 2% of $200,000, which equals $4,000.
41. Which combination correctly lists requirements a deed must satisfy to be effective?
- A. It must be in writing, name the parties, contain a legal description, include a granting clause, and be signed by the grantor and delivered and accepted
- B. It must be signed by the grantee and filed with the tax assessor
- C. It must be notarized, recorded, and signed by both the grantor and the grantee
- D. It must include consideration equal to fair market value and be witnessed by two parties
Show answer & explanation
Answer: A
A deed must be in writing, name the parties, contain a legal description, include a granting clause (words of conveyance), and be signed by the grantor and delivered and accepted to be effective. The other options add requirements the fact does not state.
42. A grantor conveys a parcel with the words "to Alicia for life." Which characterization of the estate Alicia receives is most accurate?
- A. A leasehold that must be recorded to be valid
- B. A life estate that ends at Alicia's death, with title then passing to a remainderman or reverting to the grantor
- C. A fee simple absolute, freely inheritable by Alicia's heirs
- D. An easement appurtenant that runs with the land
Show answer & explanation
Answer: B
An estate measured by the duration of a named person's life is a life estate. When that person dies, title passes to a remainderman or reverts to the grantor. It is not the highest form of ownership (fee simple absolute), an easement, or a leasehold.
43. Why does recording a deed in the public land records matter to a purchaser of real property?
- A. Recording gives constructive notice to the world and establishes priority
- B. Recording eliminates any property tax liens on the parcel
- C. Recording converts a quitclaim deed into a general warranty deed
- D. Recording is what makes the deed legally valid between grantor and grantee
Show answer & explanation
Answer: A
Recording the deed in the public land records gives constructive notice to the world and establishes priority. It does not change the type of deed or extinguish tax liens, and a deed can be effective between the parties on delivery and acceptance without recording.
44. Which statement about a life estate is INCORRECT?
- A. On the measuring life's death, title may pass to a remainderman
- B. On the measuring life's death, the property may revert to the grantor
- C. Its duration is measured by the life of a named person
- D. It is the highest and most complete form of ownership, freely inheritable
Show answer & explanation
Answer: D
A life estate lasts for the duration of a named person's life, after which title passes to a remainderman or reverts to the grantor. Being the highest, freely inheritable form of ownership describes the fee simple absolute, not a life estate, so option D is incorrect.
45. A buyer and seller in a real estate transaction have agreed on price, terms, and closing date. Which combination represents the four essential elements that must be present for their agreement to be a valid contract?
- A. Mutual assent, contingencies, a broker, and title insurance
- B. Consideration, a witness, notarization, and a legal description
- C. Offer, earnest money, recording, and delivery
- D. Mutual assent, consideration, legally competent parties, and a lawful object
Show answer & explanation
Answer: D
A valid real estate contract requires four essential elements: mutual assent (offer and acceptance), consideration, legally competent parties, and a lawful object. The other options list items that may accompany a transaction but are not the defining essential elements.
46. A seller receives an offer to purchase and responds by signing it but raising the price by $5,000 before returning it. What is the legal effect of the seller's response on the buyer's original offer?
- A. It has no effect until the buyer signs a second time
- B. It accepts the offer, because the seller signed the document
- C. It operates as a counteroffer that rejects and extinguishes the original offer
- D. It creates a binding contract at the original price
Show answer & explanation
Answer: C
Acceptance must be unqualified, so any material change to the terms—here, raising the price—operates as a counteroffer that rejects and extinguishes the original offer rather than accepting it.
47. Two parties orally agree to the sale of a parcel of land, shaking hands but never putting anything in writing. Why is this agreement unenforceable?
- A. Because land sales require notarization
- B. Because oral agreements are always void
- C. Because the Statute of Frauds requires contracts for the sale of real estate to be in writing and signed by the party to be charged
- D. Because consideration was not exchanged
Show answer & explanation
Answer: C
The Statute of Frauds requires contracts for the sale of real estate, and leases longer than one year, to be in writing and signed by the party to be charged to be enforceable. An unwritten land-sale agreement is therefore unenforceable.
48. A minor signs a contract to purchase a home and later chooses to disaffirm it. How is this contract best classified?
- A. Fully binding
- B. Voidable
- C. Void
- D. Unenforceable
Show answer & explanation
Answer: B
A contract that a party may disaffirm, such as one signed by a minor, is voidable. This is distinct from a void contract (which never existed legally because it lacks a required element) and an unenforceable contract (which is otherwise valid but cannot be enforced in court).
49. A purchase contract contains a clause allowing the seller to keep the buyer's earnest money as the agreed measure of the buyer's default. If the buyer then defaults, what is the effect of this clause?
- A. The seller may retain the earnest money as the agreed measure of the buyer's default
- B. The seller may compel the buyer to complete the purchase through this clause
- C. The seller must return the earnest money and sue for actual losses
- D. The clause is unenforceable because it lacks consideration
Show answer & explanation
Answer: A
Liquidated damages clauses let the seller retain the earnest money as the agreed measure of the buyer's default. When the buyer defaults, such a clause permits the seller to keep the earnest money as the pre-agreed remedy.
50. In a state that follows the lien theory of mortgages, who holds legal title to the property during the term of the loan?
- A. The county recorder holds title in escrow until payoff
- B. The lender holds legal title until the debt is fully repaid
- C. The borrower holds title, and the lender holds only a lien against the property
- D. Title is held jointly by the borrower and lender as tenants
Show answer & explanation
Answer: C
In a lien-theory state the borrower retains title while the lender merely holds a lien. This contrasts with a title-theory arrangement, where the lender holds legal title until the debt is paid.
51. On a loan amount of $200,000, a borrower agrees to pay two discount points at closing. What is the dollar cost of those points, and what is their purpose?
- A. $2,000, and they are a late-payment penalty
- B. $4,000, and they are prepaid interest that buys down the interest rate
- C. $400, and they cover the appraisal fee
- D. $20,000, and they insure the lender against default
Show answer & explanation
Answer: B
One discount point equals one percent of the loan amount, so two points on a $200,000 loan is 2% of $200,000, or $4,000. Discount points are prepaid interest that buys down the interest rate.
52. A buyer takes out a conventional loan and makes a down payment of 10% of the purchase price. What is the likely consequence regarding mortgage insurance?
- A. The FHA will insure the loan at no cost to the borrower
- B. The loan will automatically be guaranteed by the VA
- C. No insurance is required because the loan is conventional
- D. Private mortgage insurance will typically be required because the down payment is less than twenty percent
Show answer & explanation
Answer: D
Private mortgage insurance is typically required on conventional loans when the down payment is less than twenty percent. A 10% down payment falls below that threshold, so PMI would typically apply.
53. Under the Truth in Lending Act, as implemented by Regulation Z, what must a lender disclose so borrowers can compare the true cost of credit?
- A. The annual percentage rate (APR) and the total finance charge
- B. The legal description and granting clause
- C. The market value and replacement cost
- D. The capitalization rate and net operating income
Show answer & explanation
Answer: A
TILA, implemented by Regulation Z, requires disclosure of the annual percentage rate (APR) and total finance charge so borrowers can compare the true cost of credit.
54. A lender charges three discount points on a $150,000 loan. Assuming one point equals one percent of the loan amount, how much does the borrower pay in points?
- A. $45,000
- B. $1,500
- C. $4,500
- D. $450
Show answer & explanation
Answer: C
One discount point equals one percent of the loan amount. Three points is 3% of $150,000, which equals $4,500.
55. After a listing agreement ends, a former listing agent reveals to a new buyer that the seller had been willing to accept far less than the asking price. Which principle does this disclosure offend?
- A. Nothing, because the agency relationship has ended and all duties terminated
- B. The duty of confidentiality, which survives termination and forbids revealing information that would harm the principal's bargaining position
- C. The duty of reasonable care, which requires diligence in marketing
- D. The duty of obedience, which continues indefinitely
Show answer & explanation
Answer: B
Confidentiality survives termination of the agency and forbids revealing information that would harm the principal's bargaining position, so disclosing the seller's price flexibility after the listing ends still breaches it.
56. A seller receives a written offer and mails back a signed copy that raises the price by five thousand dollars. What is the legal effect of the seller's response?
- A. It has no effect until the buyer revokes the original offer
- B. It is an acceptance conditioned on the buyer's later approval
- C. It forms a binding contract because the seller signed the offer
- D. It is a counteroffer that rejects and extinguishes the original offer
Show answer & explanation
Answer: D
Acceptance must be unqualified, so any material change to the terms operates as a counteroffer that rejects and extinguishes the original offer.
57. A grantor conveys property using a deed that warrants title against all defects arising at any time. Which type of deed provides this greatest level of protection to the grantee?
- A. A general warranty deed
- B. A deed creating a life estate
- C. A quitclaim deed
- D. A deed conveying an easement appurtenant
Show answer & explanation
Answer: A
A general warranty deed offers the greatest protection because the grantor warrants title against all defects arising at any time, whereas a quitclaim deed carries no warranties.
58. A real estate salesperson tells prospective buyers that a certain neighborhood 'would be a better fit for their background' and steers them elsewhere based on their national origin. Which fair housing violation does this describe?
- A. Redlining
- B. No violation, because national origin is not a protected class
- C. Steering, which is directing buyers toward or away from neighborhoods based on a protected class such as national origin
- D. Blockbusting
Show answer & explanation
Answer: C
Steering is directing buyers toward or away from neighborhoods based on a protected class. National origin is one of the seven protected classes under the federal Fair Housing Act, so this conduct is steering.
59. On the licensing examination, each question is a multiple-choice item. Based on the official exam specification, which statement about the question format is accurate?
- A. The exam is entirely true/false
- B. The exam mixes essay and multiple-choice questions
- C. Every one of the 100 questions is multiple choice
- D. The exam contains 75 multiple-choice questions
Show answer & explanation
Answer: C
The official specification describes the exam as one hundred multiple-choice questions, so every one of the 100 items is multiple choice. The number 75 refers to the passing score, not the question count, and there is no basis for essay or true/false formats.
60. A borrower's loan payments are structured so that each payment covers accrued interest plus a portion of principal, and the loan balance reaches exactly zero at the end of the scheduled term. What describes this loan?
- A. Interest-only mortgage
- B. Fully amortized loan
- C. Graduated payment mortgage
- D. Balloon mortgage
Show answer & explanation
Answer: B
A fully amortized loan is structured so that regular payments cover both interest and a portion of principal, gradually reducing the balance to zero exactly at the end of the loan term; a balloon mortgage, by contrast, has payments that do not fully pay off the loan, leaving a large lump-sum balance due at maturity.
61. A buyer purchases a unit in a multi-story residential building where she owns the interior airspace of her unit outright and holds an undivided share, along with other owners, in the hallways, roof, and land beneath the building. Which form of ownership is this?
- A. Tenancy in common
- B. Planned unit development
- C. Condominium ownership
- D. Cooperative ownership
Show answer & explanation
Answer: C
In condominium ownership the unit owner holds fee simple title to the individual unit's airspace while all owners jointly hold an undivided interest in the common elements such as hallways, the roof, and the land; a cooperative instead gives owners a proprietary lease and shares in a corporation that holds title to the entire building, which does not match the individual fee ownership described.
62. A buyer purchases shares in a corporation that holds title to an entire apartment building, and in exchange receives a proprietary lease giving her the right to occupy one unit. Which form of ownership has she acquired?
- A. Cooperative ownership
- B. Timeshare ownership
- C. Ownership through a land trust
- D. Condominium ownership
Show answer & explanation
Answer: A
Cooperative ownership means the resident owns shares in a corporation that holds title to the entire building, and occupancy rights come from a proprietary lease tied to those shares rather than from direct title to a unit; this differs from a condominium, where the resident holds direct fee title to the individual unit itself.
63. A person occupies a neighbor's vacant strip of land openly, continuously, and without the owner's permission for a period long enough to satisfy the applicable legal requirements, eventually claiming ownership. Which doctrine allows this claim?
- A. Eminent domain
- B. Accretion
- C. Escheat
- D. Adverse possession
Show answer & explanation
Answer: D
Adverse possession lets a non-owner gain title to land through possession that is open, notorious, continuous, hostile, and exclusive for the required statutory period; eminent domain is instead the government's power to take private property for public use with compensation, which does not depend on a private party occupying another's land over time.
64. A property borders a slow-moving river, and the owner's land gradually gains soil deposited by the current over many years, permanently extending the boundary. What is this gradual, natural addition of land called?
- A. Erosion
- B. Avulsion
- C. Encroachment
- D. Accretion
Show answer & explanation
Answer: D
Accretion is the gradual, natural buildup of soil along a waterfront boundary caused by water action, and the added land becomes part of the owner's property; avulsion, by contrast, is a sudden, perceptible loss or addition of land, such as from a flood or a river abruptly changing course, and the original boundary line typically does not shift in that case.
65. A tenant operating a retail store installs display shelving and a walk-in cooler to run the business, intending to remove the items when the lease ends. How are these items most likely classified under real property law?
- A. Trade fixtures, which the tenant may remove before the lease expires
- B. Emblements belonging to the landlord
- C. Real property that cannot be severed from the premises
- D. Fixtures that automatically become the landlord's property
Show answer & explanation
Answer: A
Items installed by a commercial tenant to conduct business, such as shelving or equipment, are generally treated as trade fixtures and remain the tenant's personal property, removable before the lease ends, unlike ordinary fixtures that a party intends to permanently attach so that they pass with the real estate to the landlord.
66. A legal description identifies a parcel using a point of beginning and a series of directional courses and distances that trace the parcel's perimeter back to that starting point. Which method of legal description is being used?
- A. Government (rectangular) survey system
- B. Lot and block
- C. Metes and bounds
- D. Street address description
Show answer & explanation
Answer: C
A metes and bounds description defines a parcel's boundaries by starting at a point of beginning and following a sequence of bearings and distances around the perimeter back to that same point; the government survey system instead uses townships, ranges, and sections, and lot-and-block description relies on a recorded subdivision plat map rather than a chain of directional courses.
67. A subdivision's recorded declaration limits homes to single-family use and sets a minimum square footage, and these limits bind every lot owner in the development regardless of who currently holds title. What are these private limitations called?
- A. Eminent domain restrictions
- B. Police power regulations
- C. Zoning variances
- D. Deed restrictions (restrictive covenants)
Show answer & explanation
Answer: D
Deed restrictions, also called restrictive covenants, are private limitations placed on land use by a developer or prior owner and recorded so that they run with the land, binding all future owners of every lot; this differs from zoning, which is a public police-power regulation imposed by government rather than a private agreement among landowners.
68. A rear parcel is completely enclosed by neighboring properties with no way to reach any street, so a court awards its owner a right to pass over one bordering tract based purely on that lack of any other outlet. Which category of easement results?
- A. Easement by prescription
- B. License
- C. Easement in gross
- D. Easement by necessity
Show answer & explanation
Answer: D
An easement by necessity arises when a parcel has no other legal access to a street, and it is granted because access is essential to using the land, regardless of any prior continuous use; an easement by prescription instead requires open, continuous, and adverse use of another's land for the required statutory period, which is not the basis described here.
69. A court enters a money judgment against a debtor, and that judgment attaches to all real property the debtor owns in the county, not just one specific parcel. What type of lien does this create?
- A. Easement
- B. General lien
- C. Specific lien
- D. Voluntary lien
Show answer & explanation
Answer: B
A general lien attaches to all of a debtor's property within the jurisdiction, such as a judgment lien, rather than being limited to one identified parcel; a specific lien, such as a mortgage or a mechanic's lien, instead attaches only to the particular property connected to the underlying debt.
70. An owner sells the surface of a parcel to one buyer but separately conveys the mineral rights beneath the same parcel to a different party. What has occurred with respect to the bundle of rights in this property?
- A. The property has been partitioned into equal shares
- B. The property has escheated to the state
- C. An easement in gross has been created
- D. The subsurface rights have been severed from the surface rights
Show answer & explanation
Answer: D
Ownership of real property can be divided vertically so that surface rights and subsurface mineral rights are held by different parties, a process called severance; this differs from partition, which divides co-owned property among co-owners, and from an easement in gross, which grants a personal use right rather than transferring ownership of minerals.
71. Before closing, a title company reviews the recorded history of ownership, liens, and encumbrances affecting a parcel going back many years to confirm the seller can convey good title. What is this historical record of ownership called?
- A. Chain of title
- B. Plat map
- C. Certificate of occupancy
- D. Homestead declaration
Show answer & explanation
Answer: A
The chain of title is the recorded sequence of every owner and every instrument, such as deeds and liens, affecting a parcel, and examining it lets a title company confirm the seller holds marketable title; a plat map, by contrast, simply shows a subdivision's lot boundaries and does not document historical ownership or claims against the property.
72. A grantor conveys land 'to a school district, so long as the property is used for educational purposes.' If the district ever stops using the land for a school, ownership automatically reverts to the grantor. What kind of estate has the district received?
- A. Fee simple determinable
- B. Fee simple absolute
- C. Estate for years
- D. Life estate pur autre vie
Show answer & explanation
Answer: A
A fee simple determinable is created by durational language such as 'so long as' and automatically ends, reverting to the grantor, the moment the stated condition is no longer satisfied; a fee simple absolute, by contrast, carries no such condition and is not subject to automatic termination based on how the land is used.
73. Two adjoining buildings share a single wall that straddles the boundary line, and each owner has the right to use and must help maintain that shared wall. What is this structure called?
- A. Fire wall easement
- B. Curtain wall
- C. Retaining wall
- D. Party wall
Show answer & explanation
Answer: D
A party wall sits on or straddles a shared boundary line between two properties, and both adjoining owners hold rights to use it along with a mutual obligation to help maintain it, unlike a purely private wall built entirely within one owner's lot over which a neighbor has no rights or maintenance duty.
74. A family's primary residence is legally designated as their homestead, which under general homestead protections is generally shielded from forced sale by most general creditors. What is the primary purpose of this homestead protection?
- A. To exempt the property from all zoning ordinances
- B. To reduce the property's assessed value for insurance purposes
- C. To protect a family's primary residence from forced sale by most general creditors
- D. To automatically convert the property to community property
Show answer & explanation
Answer: C
Homestead protection is designed to safeguard a family's primary residence from being forced into sale to satisfy most general unsecured debts, preserving shelter for the household; it does not exempt the property from zoning rules or change how the property is valued for insurance purposes, which are unrelated to creditor protection.
75. A grantor conveys property using a deed that warrants against title defects arising only during the time the grantor owned the property, making no promises about defects from before that ownership. Which type of deed is this?
- A. Special warranty deed
- B. Sheriff's deed
- C. Quitclaim deed
- D. General warranty deed
Show answer & explanation
Answer: A
A special warranty deed limits the grantor's warranty of title to defects that arose only during the grantor's own period of ownership, unlike a general warranty deed, which warrants against title defects from all prior owners back through the entire chain of title and therefore offers the grantee broader protection.
76. A seller signs a listing agreement guaranteeing the broker a commission if the property sells during the listing period, no matter who actually procures the buyer, including the seller herself. Which type of listing is this?
- A. Open listing
- B. Exclusive right to sell listing
- C. Net listing
- D. Exclusive agency listing
Show answer & explanation
Answer: B
An exclusive right to sell listing entitles the listing broker to a commission regardless of who finds the buyer, even the seller herself, because the broker is guaranteed compensation for any sale occurring during the listing term; an exclusive agency listing, by contrast, still allows the seller to sell the property without owing a commission, which does not match the guarantee described here.
77. A seller agrees that the broker may keep, as compensation, any sale proceeds above a set minimum amount the seller wants to net from the transaction. What is this compensation arrangement called?
- A. Exclusive agency listing
- B. Net listing
- C. Open listing
- D. Multiple listing
Show answer & explanation
Answer: B
A net listing sets a minimum amount the seller must receive, with the broker's compensation consisting of whatever the property sells for above that figure, an arrangement that creates a conflict of interest because the broker benefits from pushing the sale price as high as possible rather than earning a fixed, disclosed percentage commission.
78. Two brokers each showed a property to the same buyer, but only one broker's efforts were the predominant, uninterrupted cause that led directly to the buyer's purchase. Which concept determines which broker is entitled to the commission?
- A. Procuring cause
- B. Subordination
- C. Novation
- D. Estoppel
Show answer & explanation
Answer: A
Procuring cause identifies which broker's actions were the predominant, uninterrupted effort that directly led to the successful transaction, and that broker is generally entitled to the commission when brokers dispute entitlement; novation, by contrast, refers to substituting a new party or obligation in a contract and has no bearing on resolving competing commission claims.
79. A contract has a legal defect that gives one party the right to cancel it, but until that party chooses to cancel, the contract remains binding on both sides. How is this contract best classified?
- A. Voidable
- B. Unenforceable
- C. Executed
- D. Void
Show answer & explanation
Answer: A
A voidable contract is initially valid and binding but contains a defect, such as one party's lack of full capacity, that gives the disadvantaged party the option to cancel or affirm it; a void contract, by contrast, never has legal effect at all and cannot be enforced by either party from the very outset.
80. A buyer under a purchase contract wants to be released from the agreement, and the seller agrees to substitute a new buyer in her place, discharging the original buyer's obligations entirely. What legal concept describes this substitution?
- A. Assignment
- B. Contingency
- C. Rescission
- D. Novation
Show answer & explanation
Answer: D
Novation occurs when all parties agree to substitute a new party or obligation for an original one, completely releasing the original party from further liability under the contract; an assignment, by contrast, transfers contract rights or duties to a new party but typically does not release the original party unless the other party separately agrees to a novation.
81. A borrower's loan has an interest rate that periodically changes based on a published financial index plus a fixed percentage the lender adds. Which type of mortgage is this?
- A. Adjustable-rate mortgage
- B. Purchase money mortgage
- C. Blanket mortgage
- D. Fixed-rate mortgage
Show answer & explanation
Answer: A
An adjustable-rate mortgage has an interest rate that changes periodically based on a published index plus a fixed margin set by the lender, so the borrower's payments can rise or fall over the loan term; a fixed-rate mortgage, by contrast, locks in the same interest rate for the entire loan term regardless of subsequent market changes.
82. A purchase contract includes a clause stating that all specified dates and deadlines must be strictly met, and that failure to perform by any deadline constitutes a material breach. What is this clause called?
- A. Defeasance clause
- B. Subordination clause
- C. Time is of the essence clause
- D. Habendum clause
Show answer & explanation
Answer: C
A time is of the essence clause makes every stated deadline in the contract strictly binding, so that missing even one deadline can be treated as a material breach excusing the other party's performance; without such a clause, courts often allow a reasonable delay in meeting contract dates without automatically treating the delay as a breach.
83. A purchase contract has been fully signed by both parties, but neither party has yet performed any of the promised obligations, such as delivering the deed or paying the purchase price. How is this contract best described at this stage?
- A. Void
- B. Executory
- C. Executed
- D. Unilateral
Show answer & explanation
Answer: B
A contract is executory while any promised obligations under it remain unperformed by one or both parties, such as before closing occurs; once all parties have fully performed their obligations, the contract becomes executed, so a signed but unperformed purchase contract is executory rather than executed.
84. In an open listing, the broker earns a commission only by actually producing a ready, willing, and able buyer; the seller makes no promise to pay unless and until that performance occurs. What type of contract does this describe?
- A. Unilateral contract
- B. Bilateral contract
- C. Executed contract
- D. Voidable contract
Show answer & explanation
Answer: A
A unilateral contract involves a promise exchanged for an act rather than a mutual exchange of promises, which fits an open listing where the seller promises to pay a commission only if and when a broker actually performs by producing a buyer; a bilateral contract, by contrast, involves both parties exchanging binding promises up front, as in a typical purchase agreement.
85. A seller finances a buyer's purchase directly, and the buyer takes possession and makes installment payments over time, but the seller retains legal title until the full purchase price is paid. What is this financing arrangement called?
- A. Lease option
- B. Contract for deed (installment land contract)
- C. Wraparound mortgage
- D. Deed in lieu of foreclosure
Show answer & explanation
Answer: B
A contract for deed, also called an installment land contract, lets a buyer take possession and make payments directly to the seller while the seller retains legal title as security until the price is paid in full, at which point a deed is delivered; this differs from a standard mortgage, where legal title generally transfers to the buyer at closing while the lender merely holds a lien.
86. After discovering the seller fraudulently concealed a material defect, a buyer wants to cancel the purchase contract entirely and be restored to her original position as though the contract never existed. Which remedy is she seeking?
- A. Liquidated damages
- B. Rescission
- C. Novation
- D. Specific performance
Show answer & explanation
Answer: B
Rescission cancels the contract and attempts to restore both parties to the position they were in before the agreement was made, which fits a buyer who wants to unwind the deal entirely because of fraud; specific performance, by contrast, seeks to force the contract to be completed as agreed rather than undoing the transaction altogether.
87. A buyer submits a written offer to purchase, and the seller signs it without changing a single term. At the moment the seller signs and the acceptance is communicated back, what has occurred under general contract principles?
- A. The agreement remains merely an unenforceable negotiation
- B. A binding contract has been formed through mutual acceptance
- C. A counteroffer has been created
- D. The offer has automatically expired
Show answer & explanation
Answer: B
Under the mirror image rule, an acceptance that matches the offer's terms exactly, without any changes, and is properly communicated back to the offeror creates a binding contract at that moment; had the seller instead altered any term, that response would be a counteroffer rather than an acceptance, and no contract would yet exist between the parties.
88. A real estate agent performs services for a client based on the parties' conduct and circumstances, without any spoken or written agreement stating the specific terms. What type of contract, if any, may still be recognized here?
- A. Implied contract
- B. Express contract
- C. Void contract
- D. Executed contract
Show answer & explanation
Answer: A
An implied contract arises from the parties' conduct and the surrounding circumstances rather than from explicit spoken or written words, and courts may still enforce it if the conduct clearly demonstrates mutual agreement; an express contract, by contrast, is formed through specific oral or written terms that the parties directly state to one another.
89. A buyer pays a seller a nonrefundable fee for the exclusive right, but not the obligation, to purchase a property at a set price within a specified period. What has the buyer acquired?
- A. A right of first refusal
- B. An option contract
- C. A bilateral purchase contract
- D. A lease with a purchase contingency
Show answer & explanation
Answer: B
An option contract gives the holder the exclusive right, without any corresponding obligation, to purchase property at a set price within a defined period in exchange for paid consideration; a right of first refusal instead only gives the holder the chance to match a third party's offer if and when the owner decides to sell, rather than an independent right to buy on demand.
90. After closing, a buyer tries to enforce a promise from the purchase contract that was not included in the deed or in a separate written agreement. Under the merger doctrine, what is the likely outcome?
- A. The buyer may unilaterally rewrite the deed to add the term
- B. The unstated contract promise is generally extinguished and superseded by the deed
- C. The deed becomes void because it conflicts with the contract
- D. The promise survives indefinitely regardless of the deed's terms
Show answer & explanation
Answer: B
Under the merger doctrine, the terms of the purchase contract generally merge into and are superseded by the deed delivered at closing, so promises not carried into the deed or preserved by a separate written agreement typically cannot be enforced afterward; certain obligations may survive only if the parties clearly intended that specific result through additional written terms.
91. A purchase contract is contingent on the buyer obtaining loan approval by a stated date. If the buyer fails to secure financing and properly notifies the seller by that date, what is the typical effect on the parties' obligations?
- A. The buyer forfeits the earnest money automatically
- B. The financing contingency is disregarded once the date passes
- C. The seller may sue for specific performance regardless of the contingency
- D. The contract terminates and the buyer's earnest money is typically returned
Show answer & explanation
Answer: D
When a financing contingency is not satisfied and the buyer gives timely notice as the contract requires, the contract generally terminates without penalty to the buyer, and the earnest money deposit is typically returned; this differs from a buyer who defaults outside the terms of the contingency, who may instead forfeit the deposit as agreed damages.
92. A mortgage contains a clause allowing the lender to demand full repayment of the loan balance if the borrower sells or transfers the property without the lender's consent. What is this clause called?
- A. Subordination clause
- B. Escalation clause
- C. Alienation (due-on-sale) clause
- D. Acceleration clause for default
Show answer & explanation
Answer: C
An alienation clause, also called a due-on-sale clause, lets the lender require full repayment of the loan if the property is sold or transferred without approval, protecting the lender from an unapproved assumption of the existing loan terms; this differs from a default acceleration clause, which is instead triggered by the borrower's failure to make payments rather than by a transfer of ownership.
93. A lender agrees to finance a home appraised at $250,000 with a loan amount of $200,000. What is the loan-to-value ratio for this loan?
- A. 90%
- B. 125%
- C. 75%
- D. 80%
Show answer & explanation
Answer: D
The loan-to-value ratio is calculated by dividing the loan amount by the property's appraised value, so $200,000 divided by $250,000 equals 80 percent; a lower loan-to-value ratio generally represents less risk to the lender because the borrower has more equity invested relative to the property's value.
94. A second mortgage holder agrees to allow a newly refinanced first mortgage to take priority over its own lien, even though the second mortgage was recorded earlier. What clause or agreement makes this priority change possible?
- A. Subordination clause or agreement
- B. Acceleration clause
- C. Escalation clause
- D. Defeasance clause
Show answer & explanation
Answer: A
A subordination clause or agreement allows a lienholder to voluntarily agree that its lien will rank behind another lien in priority, even if it was recorded first, which is often needed when a borrower refinances a first mortgage; without this agreement, lien priority would otherwise generally follow the order in which the liens were recorded.
95. A seller extends financing directly to the buyer as part of the sale transaction, taking back a mortgage from the buyer to secure part of the purchase price instead of requiring an outside lender. What is this type of mortgage called?
- A. Blanket mortgage
- B. Purchase money mortgage
- C. Wraparound mortgage
- D. Package mortgage
Show answer & explanation
Answer: B
A purchase money mortgage is created when the seller, or occasionally another party, provides financing directly to the buyer as part of the sale, taking a mortgage as security for the unpaid balance instead of the buyer relying entirely on outside institutional financing; a blanket mortgage, by contrast, covers multiple parcels of property under a single loan rather than describing who is financing the transaction.
96. A loan used to purchase a home also finances certain personal property that will be installed in the home, such as major appliances, with both the real estate and the personal property serving as collateral for a single loan. What is this loan called?
- A. Blanket mortgage
- B. Package mortgage
- C. Wraparound mortgage
- D. Bridge loan
Show answer & explanation
Answer: B
A package mortgage finances both real property and certain items of personal property, such as appliances, together under a single loan secured by both, which is common when a home is sold with major appliances included; a blanket mortgage instead covers multiple separate parcels of real estate under one loan rather than combining real and personal property as collateral.
97. After a foreclosure sale, the proceeds are insufficient to cover the full amount the borrower still owes on the loan. What may the lender potentially pursue against the borrower for the shortfall, where permitted?
- A. A deficiency judgment
- B. A partition action
- C. An easement by necessity
- D. A quiet title action
Show answer & explanation
Answer: A
When foreclosure sale proceeds fall short of the outstanding debt, a lender may, where the law and the loan documents permit, pursue a deficiency judgment against the borrower personally for the remaining unpaid balance; a quiet title action, by contrast, is used to resolve disputes or clear clouds on ownership of title and has no bearing on collecting a remaining debt after foreclosure.
98. A landlord refuses to rent an apartment to a family solely because they have young children living with them. Under the federal Fair Housing Act, which protected class does this refusal implicate?
- A. Disability
- B. Religion
- C. National origin
- D. Familial status
Show answer & explanation
Answer: D
The federal Fair Housing Act protects familial status, meaning it is generally illegal to refuse to rent or sell housing to a household because children under eighteen live with a parent or legal custodian, subject to limited exemptions such as certain qualified senior housing; refusing tenancy specifically because of the presence of children fits this protected class rather than national origin or religion.
99. A real estate agent encourages homeowners in a neighborhood to sell quickly at a reduced price by suggesting that people of a particular protected class are about to move into the area and property values will decline. What fair housing violation is this?
- A. Blockbusting
- B. Steering
- C. Commingling
- D. Redlining
Show answer & explanation
Answer: A
Blockbusting occurs when someone induces owners to sell by suggesting that the entry of people from a protected class into the neighborhood will cause property values to decline or otherwise harm the community, exploiting fear for profit; steering, by contrast, involves directing homebuyers toward or away from certain neighborhoods based on a protected characteristic rather than inducing panic selling among current owners.
100. A lender refuses to make loans or sets stricter lending terms for properties located in certain neighborhoods based on the racial or ethnic composition of the area, regardless of individual applicants' creditworthiness. What is this discriminatory practice called?
- A. Steering
- B. Blockbusting
- C. Commingling
- D. Redlining
Show answer & explanation
Answer: D
Redlining is the discriminatory practice of denying or limiting financial services, such as mortgage loans, to residents of certain areas based on the racial or ethnic makeup of the neighborhood rather than on individual applicants' actual creditworthiness; steering, by contrast, involves directing buyers toward or away from particular neighborhoods rather than a lender restricting loans by geographic area.
101. A newly licensed real estate sales associate wants to list and sell property and collect compensation for those services. Under general license law principles, in what capacity must the sales associate operate?
- A. Under the active supervision of a licensed broker
- B. Independently, without any supervising broker
- C. Only by partnering with an unlicensed assistant
- D. Only through a title company
Show answer & explanation
Answer: A
A real estate sales associate is licensed to perform real estate activities and earn compensation for them only while operating under the active supervision and in the name of a licensed broker, rather than independently; this supervisory structure exists so that a broker remains accountable for the associate's real estate activities and dealings with clients.
102. A broker not only deposits client escrow funds into her personal operating account but also spends some of that money to cover personal expenses. Beyond commingling, what additional and more serious violation has occurred?
- A. Subordination
- B. Puffing
- C. Conversion
- D. Steering
Show answer & explanation
Answer: C
Conversion occurs when a broker actually uses or spends client trust funds for a purpose other than the client's benefit, which is a more serious violation than commingling alone; commingling refers merely to mixing client funds with personal or business funds without necessarily spending or misusing that money, so actually spending the escrowed funds crosses the line into conversion.
103. A seller is aware of a significant, hidden structural defect in the home that a buyer would not discover through a reasonable inspection, but says nothing about it during negotiations. Under general disclosure principles, what duty has the seller most likely failed to meet?
- A. The duty to provide a home warranty
- B. The duty to obtain title insurance
- C. The duty to disclose known material facts not readily observable to the buyer
- D. The duty to pay all closing costs
Show answer & explanation
Answer: C
Sellers generally have a duty to disclose facts materially affecting the value of the property that are known to the seller but not readily observable or discoverable by the buyer through ordinary inspection; failing to disclose a known hidden structural defect can expose the seller to liability for misrepresentation, separate from unrelated obligations like arranging a home warranty or paying closing costs.
104. A licensee represents neither the buyer nor the seller as a full fiduciary agent but instead assists both parties in a transaction while owing them only limited statutory duties, such as honesty and fair dealing. Which brokerage relationship best describes this role?
- A. Transaction broker (nonagency facilitator)
- B. Dual agent representing both parties as full fiduciaries
- C. Single agent representing the seller
- D. Single agent representing the buyer
Show answer & explanation
Answer: A
A transaction broker assists the parties to a transaction without representing either as a full fiduciary agent, owing more limited duties such as dealing honestly and fairly rather than the complete set of fiduciary duties, like undivided loyalty and full disclosure, owed by a single agent; a dual agent, by contrast, would be simultaneously representing both parties as full fiduciary agents, which is a distinct and more restrictive relationship.
105. Several competing brokers in the same market informally agree among themselves to all charge the same fixed commission rate to their clients. What violation does this agreement most likely constitute?
- A. Redlining
- B. Blockbusting
- C. Price fixing, a violation of antitrust principles
- D. Commingling
Show answer & explanation
Answer: C
An agreement among competing brokers to charge identical, fixed commission rates is price fixing, a serious antitrust violation because it eliminates competition on price and can harm consumers who rely on brokers independently setting their own rates; this differs from blockbusting or redlining, which involve discriminatory conduct related to protected classes or geographic lending practices rather than anticompetitive pricing agreements among competitors.

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2026 statistics

Key facts: Florida Real Estate Sales Associate exam

100

MCQ questions

75%

To pass

3h 30m

Time limit

$37

Exam fee

The Florida Real Estate Sales Associate is administered by Florida DBPR / FREC, with 100 scored questions, a 3 hours 30 minutes time limit and a passing score of 75%.

This free Florida Real Estate Sales Associate practice test has 105 original questions written to Florida DBPR / FREC's official content outline, last checked against it on August 6, 2026. Every question shows a worked explanation, and nothing here requires a signup.

As of 2026, the Florida Real Estate Sales Associate exam fee is $37 (Pearson VUE fee).

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Official sources

Primary documents used to verify the exam details shown on this page.

Occupational Employment and Wage Statistics, May 2025 — Real Estate Sales Agents (SOC 41-9022)U.S. Bureau of Labor Statisticsbls.goveffective May 31, 2025
Florida Statutes Section 475.17 — Qualifications for practiceFlorida Legislatureleg.state.fl.us
Pearson VUE — Florida Real Estate Exam SchedulingPearson VUEpearsonvue.com
Florida Real Estate Commission (FREC) — Licensing and RenewalFlorida DBPR — Division of Real Estatewww2.myfloridalicense.com
Florida Sales Associate Candidate Information BookletFlorida DBPRpearsonvue.com
Exam Performance Summary — Real Estate, June 2025 (Division of Real Estate, FREAB meeting packet)Florida DBPRwww2.myfloridalicense.comeffective June 30, 2025
Florida Statutes Section 475.011 — ExemptionsFlorida Legislatureleg.state.fl.us
Florida Statutes Section 475.182 — Renewal of license, license periodFlorida Legislatureleg.state.fl.us

Last verified against the official exam content outline: August 6, 2026

Frequently asked questions

Do these practice questions match the real Florida Sales Associate exam?

Yes, the practice questions use the same multiple-choice format as the real exam and cover the same core topics: agency, contracts, property ownership, finance, fair housing, and valuation. The actual exam is 100 multiple-choice questions, and our questions are written to mirror that style and difficulty. No practice bank repeats the real exam word for word, but drilling the same concepts in the same format is what builds readiness.

How many practice questions should I do before test day?

Most candidates do best working through several hundred practice questions across multiple sessions rather than cramming one long run. Do a full-length timed set at least once so you experience answering 100 questions within the exam's 3.5-hour window. In the final weeks, shift to shorter daily sets focused on your weakest topics.

What's the best way to use the answer explanations?

Read the explanation on every question, including the ones you got right, because a lucky guess is a hidden weakness. When you miss a question, note which concept tripped you up, such as the difference between void and voidable contracts, and review that topic before your next session. Re-attempt missed questions a few days later to confirm the concept actually stuck.

How do I know I'm ready to take the real exam?

You need 75 points or higher to pass, so a good readiness signal is consistently scoring in the low-to-mid 80s on full-length timed practice sets. Consistency matters more than one good run: aim for several sets in a row above that level, with no single topic area dragging you down. If your scores swing widely, keep drilling your weak areas before you book the test.

Are these Florida real estate practice questions really free?

Yes, the practice questions are completely free, and you don't need to create an account or hand over an email address to use them. You can start a practice set right away and see explanations for every answer. There is no limit on how many times you can practice.

Should I practice untimed or timed?

Start untimed while you're learning the material, then switch to timed sets as test day approaches. Timed practice teaches pacing, since you'll need to average a bit over two minutes per question to finish 100 questions in 3.5 hours. Doing at least one or two fully timed runs removes the time-pressure surprise on exam day.