Exam (elaborations)
ILLINOIS REAL ESTATE BROKER PSI PRACTICE EXAM QUESTIONS AND ANSWERS
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ILLINOIS REAL ESTATE BROKER PSI PRACTICE EXAM QUESTIONS AND ANSWERS
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Name: Score:83 Multiple choice questions
Term 1 of 83
The Real Estate Settlement Procedure Act (RESPA) applies to which of the following loans?
A 30 acre farm
Points paid to obtain the loan
A first mortgage home loan
A contract for deed
Term 2 of 83
A pest inspection is ordered and an infestation is found. Who pays to correct the problem?
Net lease. The tenant pays some or all of the operating expenses, such as utilities and
taxes.
The originate with the principal.
The termination is possible because the rescission was made within a reasonable amount
of time after the lessee reached the age of majority. most contracts entered into by a
minor are generally voidable at his or her option. however, if a minor does not disaffirm a
contract within a reasonable time after attaining majority, the contract becomes fully
enforceable against him.
The party specified in the contract.
,Term 3 of 83
An owner has accepted an offer. Another buyer approaches the licensee with an offer on the
same property. The licensee should tell this second offeror that
Largest down payment. An equity investment refers to the amount of monetary interest
an owner has in the property over and above any mortgage indebtedness.
Yes, because an agency is formed whenever one party delegates to another the right to
act on his behalf in certain business transactions
the owner has a non-conforming use and can continue to operate the gas station. since
the gas station existed prior to the change of the zoning ordinance it is grandfathered in
this offer can be presented as a back-up offer only. Once an owner has accepted an
offer, the owner has entered into a legal and binding contract.
Term 4 of 83
When using the sales comparison approach, a licensee determines that a comparable
property's tile floor in the entry hall is worth $2,000. The subject property does not have tile
floors at all. Which of the following adjustments should be made?
an option. A unilateral contract is one in which one party makes an obligation to perform
without receiving in return any express promise of performance from the other party. An
option is a unilateral contract because the seller agrees to sell for a certain period of
time at set terms, provided the buyer performs by paying the specified option price.
The rental rates for similar units in the area
the comparable should be adjusted downward. It is always the comparable that is
adjusted, never the subject property. If the comparable is better than the subject
property, the adjustment to it is downward. If the comparable is not as good as the
subject property, the adjustment to it would be upward.
this offer can be presented as a back-up offer only. Once an owner has accepted an
offer, the owner has entered into a legal and binding contract.
,Term 5 of 83
An owner of an apartment building asks a licensee who is managing the property not to
advertise the apartments in the local newspaper because it is published by her ex-husband.
The property manager argues that many advertisements in this newspaper have produced
rentals, but the owner will not change her mind. Should the property manager advertise in this
newspaper?
Yes
No
Term 6 of 83
A managing broker requires his licensees to mention a particular lender to buyers. The broker
has a financial interest in this particular mortgage lender. Which of the following should the
licensee recommend to buyers?
Suggest that buyers should only consider lenders with no affiliations
Advise buyers to avoid this lender due to the broker's interest
Only recommend this lender without mentioning the broker's interest
Consider this lender, disclosing the broker's interest, and other lenders.
Term 7 of 83
Four people bought an investment property together, each having an equal ownership
interest. They took title in such a manner that if one died he could leave his one-fourth interest
to his heirs. How did they take title to the real estate?
tenants in common. Each owner can sell or bequeath their property without consent of
the other co-tenants
sole proprietorship. one owner has complete control over the property
community property. ownership is shared between spouses only
joint tenants. ownership is shared equally with rights of survivorship
, Term 8 of 83
When a borrower defaults on a mortgage, an acceleration clause allows the lender the option
of
allowing the borrower to make partial payments indefinitely
reducing the interest rate for the remaining balance
demanding immediate payment of the entire loan balance.
extending the loan term to accommodate the borrower
Term 9 of 83
The most typical purpose of a deed restriction is to
prevent housing from being encumbered
consideration
control future uses of the property
the rental rates for similar units in the area
Term 10 of 83
An enforceable purchase agreement is formed when
the seller expresses interest in negotiating the offer further
the buyer verbally agrees to the terms of the offer
the buyer knows of the seller's written acceptance of the offer
the buyer submits a counteroffer to the seller
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