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Texas State Portion Real Estate Exam
Questions And Answers Correct Graded A+
Latest Top Score 2025
Who is responsible for any wrongs done by a salesperson while acting within the scope of the agency agreement? - correct answerThe broker is liable for the wrongdoing of his or her salespersons. The principal is liable for any wrongs committed by the broker while acting within the scope of the agency agreement. what is the distinction between sales contracts and option contracts? - correct answerOne characteristic of sales contracts is mutual obligation. Option contracts lack mutual obligation. The buyer in an option contract is not obligated to buy. A listing agreement must contain: - correct answera standard street address is sufficient. If the commission investigates a complaint and determines that an individual's real estate license should be suspended or revoked, the licensee is entitled to a hearing before the commission within how many days after the commission reaches its decision? - correct answerA licensee who faces suspension or revocation of their license is entitled to a hearing within 30 days of the commission reaching their decision. Which of the licensed entities does not fall under the regulatory authority of the Texas Real Estate Commission? - correct answerThe Texas Appraiser Licensing and Certification Board has jurisdiction over state licensed and certified appraisers. In addition to licensing brokers and salespersons, the Texas Real Estate Commission is responsible for licensing real estate inspectors and for regulation of companies that sell and issue residential service contracts ("home warranties"). (Article 65736, Vernon's Texas Civil Statutes. A licensee in Texas may not practice law, unless licensed and authorized to do so in Texas. Practicing law includes altering contracts, or drawing up: - correct answera deed, deed of trust, will, or other written instrument that may transfer or affect the title to land. What penalties may a licensee who breaches the agency relationship face? - correct answerA licensee who breaches the agency relationship may be sued for damages, termination of the contract, and/or non-payment of the commission.
Undisclosed dual agency is: - correct answera violation of the TRELA. What is the composition of the Broker-Lawyer Committee? - correct answerSix broker members are appointed by the Texas Real Estate Commission; six attorney members are appointed by the President of the State Bar of Texas. The appointees serve a term of six years with one-third of them being appointed every two years. A licensee must disclose any existing agency relationships to a new client. This disclosure: - correct answermay be done orally or in writing. A broker may do which of the following for an individual without actually representing the individual? - correct answerA broker may obtain financing, assist in locating a property, and prepare a contract or lease for an individual without representing the individual. A real estate licensee must notify the real estate program manager if: - correct answerA licensee must notify the real estate program manager within 20 days of receiving any criminal complaint, information, indictment, or conviction in which the licensee is named as a defendant; or entry of a civil court order, verdict, or judgment, against the licensee in any court of competent jurisdiction in which the subject matter therein involves any real estate or business-related activity by the licensee. Pamela, who lives in a suburb in which many homes are rented, decides to open a rental agency in order to assist her friends in finding suitable renters. Pamela's conduct is - correct answerunacceptable because it involves an activity for which a real estate license is required. The sole broker of a brokerage firm has his or her real estate license suspended for two years. What would happen to the licenses of the salespersons affiliated with this broker? - correct answerIf the broker's license is suspended or revoked, the salespersons' licenses are made inactive and must be returned to the commission. A salesperson's license may be made active when the salesperson is sponsored by a new broker. Which agency is responsible for the contract forms used by Texas licensees? - correct answerThe Texas Real Estate Commission A community property with rights of survivorship agreement must: - correct answerdoesn't need to go through probate, must be signed by both spouses, must include the property description, be in writing, contain wording that makes evident the intent of survivorship, and be recorded in the county courthouse. Generally, the most important responsibility of an agent is to: - correct answerrepresent the financial interests of the client.
What should a real estate broker do with licenses coming into his or her possession? - correct answerprominently display them in his or her place of business If a broker is working as an intermediary to both parties in a transaction, the broker may collect commissions from both parties if: - correct answereach party knows exactly how much commission is collected from the other party and receives full disclosure of all facts. A contract may be terminated by: - correct answerdefault, performance, mutual agreement, rescission, or by the fact that it is impossible to perform. Who is credited with actually securing a written offer? - correct answerProcuring cause Each commissioner must be: - correct answerboth qualified voters and residents of Texas. Only six of the members must be licensed real estate brokers. A salesperson may split his or her commission with: - correct answeranyone that is not a licensed salesperson or broker in Texas. An exclusive-right-to-sell agreement must include: - correct answera definite termination date not subject to prior notice. A licensee avoids mentioning negative important facts that he or she knows to be true in his or her presentation to a potential purchaser of real property. The licensee: - correct answermay be charged with misrepresentation by omission. Each TREC member is appointed for a minimum term of ____. - correct answer6 years, or until a successor is appointed. For a two-year lease, a landlord may record, instead of the actual lease, a: - correct answerMemorandum of lease. For more then one year lease Seller Sam enters into a listing agreement with Broker Barb on January 5 that was to last 4 months. In early March, Sam decides that he doesn't want to sell his house after all. What applies to the broker? - correct answerThe broker no longer has the authority to sell the house and the seller may be subject to a penalty. However, the broker is not entitled to any commission. Full disclosure of material facts by a licensee falls under which of the obligations of a licensee? - correct answerDuty of Integrity What is a counteroffer? - correct answerA rejection of an offer and a presentation of new terms and/or conditions. It is not valid until both parties have signed it. Parties can be compelled to take a dispute to mediation prior to being able to initiate litigation by - correct answerA judge. Under the 1987 Alternative Dispute Resolution Act,
only a judge can compel parties to take a dispute to mediation. Others can encourage parties to submit voluntarily to mediation prior to resorting to litigation but only a judge can compel. What is true of a mechanic's and materialman's (M&M) lien? - correct answerHomesteads are not protected against M&M liens, the lien is valid as of the first day work began on the property, and all owners of the property must sign before work is begun. A broker has a duty to provide what two things to his sponsoring agents? - correct answerSupervision and evaluation Once a licensee has obtained a listing, he or she must: - correct answerprovide the seller with a legible, signed, true, and correct copy of the listing agreement. Six of the members of the Broker-Lawyer Committee are selected from: - correct answerThe State Bar of Texas. Responding to or facilitating inquiries about the ancestry or familial status would put the licensee in the position of violating - correct answerFederal and state laws as well as the Texas Real Estate Commission rules. Facilitating such inquiries could result in suspension or revocation of one's license. Which type of listing agreement allows the broker to keep all proceeds from the sale that exceeds a certain amount? - correct answerA net listing. Karen's application for licensing was approved on June 30, 2004. What is the latest date on which she may pass the Texas state licensing exam? - correct answer12/30/ A homestead sold for delinquent taxes may be redeemed within ______ of the sale. - correct answer2 years. Other properties may be redeemed within six months. Which of the Texas Real Estate Commission addenda contains the words "time is of the essence?" - correct answerThey are The Addendum for Sale of Other Property by Buyer, The Back-Up Addendum, and the Third-Party Financing Condition Addendum. An option clause is always interpreted under the ""time is of the essence"" rule. Texas courts will favor upholding the terms of a contract as long as there is evidence that the parties have acted in good faith and have accomplished the objectives of the agreement within reasonable time. Strict time frames will be enforced when the parties specifically agree in the contract that time is of the essence. An agency relationship cannot be created by: - correct answerinherent authority What is true of listing contracts? - correct answerThe salesperson is not allowed to accept listings in their own names; they must be in the broker's name. The contract
What is required to obtain a broker's license in Texas? - correct answerlicense must be at least 18 years of age, have been actively engaged as a licensed salesperson for at least 2 years, and complete 900 hours of approved coursework For what is there NO promulgated form? - correct answercontract for deed A contract contains a clause stating that "time is of the essence". This clause indicates that: - correct answerany time limitations indicated in the contract must be strictly met. If Broker Bob, the listing agent, negotiates an offer that is presented by Broker Bill, who works for another company and represents a buyer, the brokers will be acting as: - correct answersingle agents since they both have agreements with their respective principals. What penalties may be imposed on an unlicensed individual for a single act of brokerage for which a license is required? - correct answer$4,000 fine plus other penalties provided by law Brokers and salespeople in Texas who are not lawyers may: - correct answerFill in the blanks on a preprinted form contract promulgated by TREC Three members of the TREC must be: - correct answerrepresentatives of the general public who are not licensed and do not have a financial interest in the practice of a real estate office. Which of the following is true of a licensee purchasing or selling his or her own property? - correct answerIt is legal as long as full disclosure is made. Earnest money must be deposited in an escrow account in a "timely manner." TREC considers a "timely manner" to be: - correct answerby the close of business on the second business day after the parties execute the contract. The commission will investigate complaints submitted up to how long after the alleged incident? - correct answer4 years what is true of an assumed name? - correct answerA broker must file an assumed name with the county clerk in the county where the broker conducts business. He or she must re-file an assumed name every 10 years, and only advertising that does not readily identify the broker as a real estate agent must contain the words "REALTOR", "real estate agent", "real estate broker", or "realty"." what is NOT listed as included in the property to be conveyed in paragraph 2 of the Texas Real Estate Commission form 20-6? - correct answera self-contained spa with cover and heater
Buyer Betty gives Broker Bob an earnest money deposit. According to Texas law, Broker Bob should: - correct answerhold the earnest money deposit in a secure place in the broker's office until the offer is accepted and the contract is signed. He or she then must deposit the funds in a separate escrow account by the end of the second business day after the contract is signed. The total value of all personal homestead property may not exceed $________ for a single adult or $_______ for a family. - correct answer15,000/30, what individuals are exempt from the real estate license requirement? - correct answerAn employee who rents their employer's property An intermediary appoints associates in a transaction. Who must receive written notification of the appointments? - correct answerAll parties to the transaction Sam is preparing an offer for the purchase of the property located at 4615 Pleasant Boulevard and is not sure of the legal description of the property. To complete paragraph 2 of the 20-6 contract form, he should - correct answerobtain the description from the county appraisal district, making certain that he obtains the lot, block, and section numbers as well as the correctly spelled name of the subdivision. A broker is obligated by law to treat his or her client: - correct answerhonestly A real estate broker who is convicted of making false, deceptive, and misleading statements may face: - correct answera financial penalty up to three times the amount of the actual damages. Under Section 15 of TRELA, the licensee may also have his or her license revoked or suspended. Agency disclosure is required: - correct answerin writing The commission has the authority to revoke a salesperson's license if he or she: - correct answerdeposits a buyer's earnest money into his or her bank account. A broker who places earnest monies in the company's operating account is guilty of what? - correct answercommingling If a salesperson's license is revoked, to whom may he or she appeal the decision? - correct answerThe district court Who may revoke or suspend a Texas real estate license? - correct answerTexas Real Estate Commission (TREC) A single act of brokerage for compensation without a license is considered: - correct answera misdemeanor.
mortgages, and some homeowners' association liens. Texas law does not require a formal declaration in writing to create a homestead property. Repair or remodeling of a property generally adds to its worth. In recognition of the role contractors and suppliers play in increasing the value of a property, in many states they are assured payment for their goods and services by being able to file a/an: - correct answermechanic's lien against the property. Which type of listing agreement is now prohibited under Section 15 of the TRELA? - correct answerOpen listing Before entering into any substantive discussions about a property with a potential buyer, a real estate licensee should: - correct answerprovide the buyer with a Statutory Information Statement, containing information on brokerage services. In Texas, a salesperson's license may be revoked if: - correct answerthe salesperson deposits escrow money into his or her personal checking account, and the salesperson advertises in a newspaper that she is the broker or the agent To be legally binding, a contract for real estate must have - correct answercompetent parties, mutual agreement, a lawful objective, consideration, and been reduced to writing. The most accurate way to uniquely locate and bound a parcel of real property is to use - correct answera metes and bounds survey. If a broker agrees to represent a buyer, but does so without a written agreement, the broker is known as a(n): - correct answervolunteer agent. A number of young people have been injured in skateboarding accidents within the city park, so the city council has passed a resolution prohibiting skateboarding within public areas. The action is taken in accordance with the city's: - correct answerpolice powers. Local governments may enact laws that protect the public health, safety, or welfare. The Residential Lead Base Paint Hazard Reduction Act allows tenants to have prospective residential lease property inspected by certified professionals if the property was constructed prior to which year? - correct answer Under eminent domain, if the parties cannot agree to property value, which type of lawsuit will be filed by a city to take the property for public use? - correct answercondemnation Anyone wishing to obtain a mortgage loan for the purchase of a home today who is qualified may obtain any of the following types of loans - correct answerA Conventional 15 - year loan, FHA insured 30-year loan, or a VA guaranteed 30-year loan (if purchaser is a veteran).
If an agent fails to deposit money received from the buyer as earnest money into an escrow account in a reasonable amount of time, what may occur? - correct answerSuspension or revocation of the agent's license
- To be legally entitled to a commission related to a real estate transaction, agent Richard Rock must be all of the following EXCEPT A. licensed. B. authorized to be involved in the marketing effort. C. the procuring cause of the transaction. D. under contract to either the buyer or seller. - correct answerunder contract to either the buyer or seller. what is true of a broker who acts as an intermediary in a transaction? - correct answerThe broker may not disclose that the owner will accept a price less than the asking price. Under a (n) ____________ agreement, only the specified broker has the right to produce a buyer. The seller is even precluded from selling his or her own property. - correct answerexclusive-right-to-sell listing What is true of dual agency? - correct answerthere is no longer a statutory provision for dual agency in the TRELA. However, common law permits a broker to represent both a buyer and a seller in the same transaction. The members of TREC are appointed by - correct answerThe Texas governor The agreement signed by the owners of House A and House B to share a common driveway is a form of - correct answeran easement. An encumbrance that states a monetary interest in someone's property is called - correct answera lien An article of personal property that is permanently attached and becomes part of the real estate is known as - correct answera fixture. Riparian and littoral rights belong to owners of - correct answerland bordering bodies of water. (Riparian rights apply to owners of land bordering rivers and streams, littoral rights to those owning land on lakes and oceans.) Man-made additions to real estate are known as - correct answerImprovements, which become part of the real property, include man-made additions like sewers, roads, and buildings.
The Webers own three pieces of real estate: their house, a lakeside cottage, and a tract of woodland. What expense may be deducted for all three properties on the Weber's income tax return? - correct answerproperty taxes The Hansons' home was listed with a broker, but they ended up locating a buyer at Mr. Hanson's place of employment and sold the property themselves. They were still obligated, however, to pay a brokerage fee. What kind of listing had they agreed to? - correct answeran exclusive right to sell In which of the following types of agency might you see the termination of the agency relationship immediately after closing? - correct answerspecial agency (is typically a single purpose, short term agency relationship.) If a contract ends with the sale of the property, - correct answerthe agency relationship of the seller and the listing broker ends at that time. what best describes the role of an agent who seeks a particular type of property for a client? - correct answerspecial agent When a buyer is your customer, which of the following services would you NOT provide him/her? - correct answerloyalty. While a buyer customer is entitled to honest business dealings, he does not get the same undivided loyalty that is owed to a buyer client When describing the particulars about a property, the agent does not disclose that a capital improvement project has been approved that will result in a special assessment to the owner in the near future. The broker has - correct answerfailed to provide proper disclosure as required by law. the sellers have the same obligations. The furnace at 39 State Street doesn't work properly. However, because the prospective buyers inspect the house in July, there is no indication of this. The condition of the furnace is known as - correct answera latent defect. a latent defect are - correct answerthose that cannot be seen by a normal prudent inspection. If a material fact concerning the condition of a residential property is known by the listing broker but intentionally not disclosed to the buyer, the broker may be - correct answerguilty of fraud, subject to litigation, and subject to license revocation. a comprehensive buyer representation agreement would address the - correct answerduties of the agent, termination date, and compensation agreement. The statute of frauds requires that - correct answeroffers, acceptances, land contracts, and other real estate documents to be in writing to be enforceable.
Richard Rock wants to buy Craig Johnson's house, but Craig doesn't want to turn over title until he receives the purchase price. They could use either a lease option or a land contract. Richard would prefer a lease option because - correct answerhe will be free to change his mind about buying. Anna Jamison rents a small building for her boutique. In addition to rent, she also pays property taxes, utility bills, and insurance on the property. She must have a/an: - correct answernet lease What are the buyer's choices upon presentation of a counter-offer? - correct answeraccept, reject, consider, or counter-offer The buyer gives the owner a $5,000 payment and a written agreement stating that, on July 1 of the following year, the buyer will purchase the property for $150,000 cash or the owner may keep the money. This transaction is known as - correct answeran option agreement. In an option contract, - correct answerthe buyer purchases the right to buy a property at fixed terms within a defined period of time. If the option is not executed, the owner gets to keep the deposit. A broker may define the sponsored agent's general duties and authority, but not - correct answerhow the agent does his business. The earnest money accompanying a purchase offer - correct answeris not necessary to establish a valid contract. its main use is to reassure the seller and prove the buyer's good faith. A contract which was signed by a minor is - correct answervoidable by the minor, but not by the other party. An owner of property conveys interest in that property to a private school with the stipulation that the land only be used as a playground. Several years later, the school trustees announce that the school is going to expand by building an addition onto this property. The grantor can - correct answerwait, and then demand that the addition be torn down. An accrued charge on a closing statement is paid - correct answerin arrears. The entity that loses ownership through a deed of trust mortgage foreclosure is the - correct answermortgagor (borrower) An abstract of title contains - correct answerthe summary of a title search A deed is the instrument used to convey ownership of - correct answerreal property.
What is required in order for a salesperson, who has been appointed and assigned to one of the parties, to be able to convey confidential information about the other party to the party to whom he or she has been appointed? - correct answerwritten permission of the other party what agreement is NOT an agreement that must be reduced to writing to be enforceable? - correct answermultiple listing A seller received an offer last evening and is considering how to respond to it. While the seller is still thinking about the first offer, another offer is given to the listing agent. What should the listing agent do? - correct answerpresent the second offer immediately Sam and Sally are occupying an apartment on a month-to-month lease with rent due and payable on the 15th day of each month. How much notice must they give their landlord to terminate their tenancy-at-will? - correct answer30 days unless otherwise stipulated in the rental agreement All of the following are approaches that an appraiser may use to establish value EXCEPT A. market approach. B. cost approach. C. income approach. D. tax assessment approach. - correct answerD. tax assessment approach. what do appraiser take into consideration? - correct answeranalyzes physical, political, and social conditions in the neighborhood of the subject property. A loan in which the borrower pays interest only over the life of the loan and then pays the entire principal at maturity of the loan is called? - correct answera term loan The provisions of the Real Estate Settlement Procedures Act (RESPA) apply to - correct answerone- to four-family mortgage loans, including equity loans. If a seller's agent shares his commission with a buyer's agent - correct answerthis is not necessarily an indication of agency representation. If a broker negotiates on behalf of both the buyer and the seller, this would indicate some form of - correct answerdual agency. If a seller receives multiple offers - correct answerhe may accept any one of them regardless of when it was received "in time." Administration of ____________ would best be handled by a property manager? - correct answera shopping center ( complex details of commercial property are best administered by a professional property manager.)
The Sinclair's needed two different loans to buy their first home. The loan that will have first claim on the value of the house in case of foreclosure is the one that was first - correct answerrecorded. What is a recording? - correct answerThe noting in the registrar's office of the details of a properly executed legal document, such as deed, mortgage note, satisfaction of mortgage, or extension of mortgage, thereby making it a part of the public record
