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PA REAL ESTATE EXAM QUESTIONS AND ANSWERS
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PA REAL ESTATE EXAM QUESTIONS AND ANSWERS
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PA REAL ESTATE EXAM QUESTIONS AND ANSWERS1. A listing broker procures a ready, willing, and able buyer for his or her seller-principal.
The seller first accepts the buyer's offer in writing, then experiences a change of heart
and withdraws the original acceptance. In this situation, the broker. 1. may be entitled to
collect a commission. 2. has no recourse because the transaction was never completed.
3. may sue the buyer.\n4. may retain the deposit as compensation. - Answers -1. 1. The
broker has fulfilled his obligation under the terms of the listing contract with the seller by
procuring a ready, willing, and able buyer and is therefore entitled to recover his agreed-
upon compensation. He may not sue the buyer and cannot retain the deposit as
compensation.
2. In Pennsylvania, brokerage fees are\n\n1. set by law.\n2. set by the Pennsylvania
Real Estate Commission.\n3. determined by local groups of brokers operating a multiple
listing service.\n4. negotiable between the consumer and the broker employed by the
consumer. - Answers -2. 4. Brokerage fees are established solely as a result of a
negotiated agreement between the broker and the consumer. The broker is required to
disclose this to the consumer at the initial interview (608 (8)). Fees are not determined
by law, the real estate commission, or local brokers.
3. Commissions earned by a broker in a real estate sales transaction\n\n1. are
determined by agreement of the broker and the consumer.\n2. may be shared with an
unlicensed person who is employed by the broker, provided that such person aided the
broker in bringing the buyer and seller together.\n3. may be deducted from the earnest
money deposit and claimed by the broker as soon as the buyer and seller execute the
purchase and sales agreement.\n4. are based on a schedule of commission rates set
by the multiple listing service. - Answers -3. 1. Brokerage fees are established by
agreement between the broker and the consumer to whom the broker provides service.
The broker may not share these fees with an unlicensed individual (604 (a)(12.1)). The
broker must maintain the earnest money deposit until the transaction is consummated
or terminated.
4. Several weeks after a closing, an associate broker received a thank-you letter and a
nice bonus check from the seller of the house. The associate broker cashed the check
because he felt it was earned. In this situation, which of the following is true?\n\n1. The
associate broker may accept the bonus because he is licensed as an associate broker.\
n2. Accepting the money is allowed if more than 30 days have elapsed since closing.\
n3. The associate broker may accept the money if his broker permits him to do so.\n4.
Accepting the money is a violation of the License and Registration Act. - Answers -4. 4.
License law prohibits a salesperson or associate broker from accepting a commission or
any valuable consideration for the performance of any act specified in the law from any
person except the licensed real estate broker with whom he is affiliated (604 (a)(12)).
5. What determines the amount of compensation to be paid to a licensed real estate
salesperson by the employing broker?\n\n1. Negotiation between the broker and
property owner at the time property is listed for sale.\n2. The rules and regulations of
,the multiple listing service to which the broker belongs\n3. The code of ethics of the
association or board of REALTORS®\n4. The contract between the employing broker
and the licensed real estate salesperson - Answers -5. 4. The licensed salesperson and
employing broker agree to the terms of compensation to be paid by the broker to the
salesperson. Professional organizations, multiple listing services, and other parties,
such as sellers, do not dictate or control compensation arrangements.
6. A real estate company has entered into agency agreements with both a seller and a
buyer. The buyer is interested in making an offer on the seller's property. Can this
occur?\n\n1. No, because the real estate company would then be a dual agent.\n2. Yes,
as long as written agency agreements have been entered into with both parties.\n3.
Yes, if the seller has agreed to pay the commission.\n4. Yes, if both the buyer and seller
give their informed consent in writing after receiving full disclosure regarding dual
agency. - Answers -6. 4. In Pennsylvania, dual agency is permitted if both parties give
their fully informed consent in writing 606.4(A).
7. The listing agreement with a seller has expired, and the seller lists with a different
brokerage firm. The original listing salesperson now represents a buyer interested in the
seller's property. The original listing agent\n\n1. is a dual agent and must get permission
from both parties.\n2. cannot disclose to the buyer information about terms acceptable
to the seller that were received during the listing period.\n3. cannot disclose to the buyer
information about the physical condition of the property.\n4. cannot represent the buyer.
- Answers -7. 2. The original agent may not disclose offers received during the first
listing. The fiduciary duty of confidentiality continues after the termination of the agency
relationship (606.1 (g)). The agent is not a dual agent, since the original agent no longer
has an agency relationship with the seller.
8. A buyer contacts a real estate office and indicates an interest in purchasing a home
in the area. In the absence of a buyer agency relationship with the buyer, a salesperson
from the real estate office should do all of the following EXCEPT\n\n1. provide the buyer
with information on properties for sale in the area.\n2. give the buyer information on
mortgage interest rates and terms.\n3. discuss specific information regarding the
buyer's motivation and urgency.\n4. explain to the buyer about buyer agency, seller
agency, and dual agency. - Answers -8. 3. The agent should not gain information about
motivation and urgency, which is generally of a confidential nature and should not be
discussed outside of an agency relationship. The agent may provide information on
properties for sale in the area, discuss mortgage interest rates and terms, and discuss
various levels of representation available to the buyer.
9. In a dual agency situation, a broker may collect compensation from both the seller
and the buyer if\n\n1. the broker is licensed as a dual agent.\n2. the buyer and the seller
are related by blood or marriage.\n3. both parties give their informed consent in writing
to the dual compensation.\n4. both parties are represented by attorneys. - Answers -9.
3. Written consent to act as a dual agent must include a statement of the terms of
compensation (606.4). Both parties must consent to the dual compensation. Neither
must be represented by attorneys nor do they have to be related.
,10. A buyer is interested in seeing a house listed with XYZ Realty but does not wish to
enter into an agency relationship. A salesperson from LMN Realty can show the buyer
the house if\n\n1. XYZ Realty has obtained the seller's written consent to offer
subagency, and the buyer is given a consumer notice and disclosure stating that LMN
Realty represents the seller.\n2. XYZ Realty obtains LMN Realty's consent to
subagency, and the buyer is given an Agency Disclosure Notice, stating that XYZ
Realty represents the\nseller.\n3. the buyer verbally agrees to a buyer relationship with
LMN Realty.\n4. a salesperson from XYZ Realty accompanies them during the showing.
- Answers -10. 1. The seller must consent in writing in order for the listing broker to
extend an offer of subagency (606.1 (c)). The cooperating broker acting as a subagent
must provide the consumer notice and appropriate documentation to the buyer prospect
(606.1 (b)(4)). The buyer is not the one to agree to the offer of subagency.
11. A real estate broker has signed an agency agreement with a tenant, who is looking
for an apartment to rent. The broker does not charge a fee to prospective tenants;
rather, the broker receives compensation from landlords. The broker tells a landlord that
the prospective tenant could probably pay a somewhat higher rent than the landlord is
asking. In this situation, the licensee\n\n1. owes the fiduciary agency duties to the
landlord who pays the broker's fee.\n2. appropriately disclosed to the landlord under
these circumstances.\n3. violated the fiduciary duties owed to the tenant.\n4. has no
duty of confidentiality because the licensee is not charging a fee to prospective tenants.
- Answers -11. 3. By entering into an agency agreement with a prospective tenant, the
broker assumes full fiduciary responsibilities without regard for the issue of
compensation. The broker has not operated in a manner consistent with the best
interest of his client.
24. A licensed real estate salesperson owns a three-unit apartment building for
investment purposes. Under what conditions may the salesperson sell the property?\n\
n1. The salesperson may be a "for sale by owner," but the salesperson must disclose
his or her license status in ads for the property.\n2. The salesperson must list the
property for sale with the salesperson's employing broker.\n3. Since the seller is a
licensee, only buyers represented by other agents may be shown the property.\n4. The
licensee must disclose his or her license status to the buyer at the closing when funds
are being disbursed. - Answers -24. 1. A licensee who sells or leases his or her own
real estate must disclose this licensure in advertisements for the property. This
requirement does not apply if the property is listed for sale with a real estate company
(35.304).
25. A consumer contacts a licensee to discuss the possibility of the licensee handling
the sale of a property owned by the consumer. The licensee's responsibility is to\n\n1.
provide the consumer with a written guarantee concerning the amount and type of
advertising the broker will provide.\n2. advise the consumer that after listing the property
for sale, any cooperating broker who shows the property will be acting as a buyers
agent.\n3. provide a Consumer Notice to the prospect before engaging in any
, substantive discussion about real estate needs with the consumer.\n4. advise the seller
that all listing contracts must be in writing on forms approved by the commission. -
Answers -25. 3. During the initial interview the licensee must provide a Consumer
Notice containing disclosures required by the rules of the commission (608). An initial
interview is considered to be the first contact between a licensee and a consumer where
a substantive discussion of real estate needs occurs.
26. If a licensed salesperson owns multifamily residential property for investment
purposes, the salesperson\n\n1. must deposit collected rents into an escrow account.\
n2. must disclose his or her license status to prospective tenants before the tenant
enters into a lease agreement.\n3. may pay a referral fee to another salesperson
employed by the same broker if the referred prospect leases a unit in the building.\n4.
must hire the employing broker as the property manager and conduct all leasing activity
through the broker. - Answers -26. 2. A salesperson who is selling or leasing his or her
own real estate is required to disclose his or her licensed status to a prospective buyer
or lessee before an agreement is entered into. Rents are not deposited into an escrow
account. Only the employing broker may compensate a licensed salesperson employed
by that broker (35.288).
27. When discussing the possibility of listing a large parcel of vacant land with an
owner, the broker determines that he would like to secure an option to purchase the
property. How should the broker proceed?\n\n1. Include language in the listing contract
granting the option to the broker for purchase of the listed property\n2. Arrange to have
the owner enter into an option agreement with a straw party selected by the broker in
order to avoid a conflict with the seller\n3. Secure an exclusive-right-to-sell long-term
listing but refuse to aggressively market the property until his option has expired\n4.
Disclose his interest and license status to the owner and discuss terms of the option
agreement prior to and distinct from the listing agreement - Answers -27. 4. The broker
must disclose his or her license status prior to entering into an agreement with an owner
(35.332(c)). A broker may not incorporate an option to purchase property in a listing
agreement for the property, and the broker may not conduct business through a straw
party.
28. If a licensed salesperson, without the knowledge or consent of the employing
broker, violates requirements regarding delivery of a Consumer Notice at the initial
interview, what are the consequences?\n\n1. The broker will have his or her license
suspended or revoked for failing to exercise supervision over his or her licensed
salesperson.\n2. The salesperson may have his or her license suspended or revoked.\
n3. Unless the consumer files a written complaint with the commission, neither the
broker nor salesperson are subject to disciplinary proceedings.\n4. As long as the
Consumer Notice is signed by the parties prior to entering into an agreement of sale
there is no violation. - Answers -28. 2. The salesperson's failure to provide the
Consumer Notice at the initial interview is a violation of the license law (604(a)(15.1)).
Licensees are subject to disciplinary action by the commission including possible
suspension or revocation of their licenses.
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