Shadowing Practice: 100 Texas Real Estate Exam Questions (51-100, Part 2) - Learn English Speaking with Video

Which of the following best describes a fixture?

A. Any item of personal property positioned within the boundaries of a parcel of real estate.

B. An item of personal property that has been converted to real property.

C. An item of real property temporarily placed on land for the purpose of conducting a business.

D. An item of personal property that has been left in one location for a period of six months.

The answer is B, an item of personal property that has been converted to real property.

Let's go to the explanation.

A personal property item that has been converted to real property by attachment to real estate is called a fixture.

Typical examples are chandeliers, toilets, water pumps, septic tanks, and window shutters.

The owner of real property inherently owns all fixtures belonging to the real property.

When the owner sells a property, the buyer acquires rights to all fixtures.

Let me give you a quick tip.

Anytime you see the word fixture, I want you to think of the word attached.

Anything attached to a property, inside the property, is a fixture, such as a chandelier.

If you have that chandelier on the table, you have not attached it yet, it is personal property.

The minute you put it up and you attach it, it is now real property.

What are the steps in order in the agency disclosure process?

A. Confirm, Disclose, Elect.

B. Disclose, Confirm, Elect.

C. Disclose, Elect, and then Confirm.

D. Elect, Confirm, and Disclose.

And the answer is C as in Charlie.

Disclose, elect, confirm.

This is easily remembered through the acronym DEC.

So just remember the agency disclosure allows the client to nominate the real estate agent and the broker to represent them.

Now, in the agency disclosure, it's going to state what the client's responsibilities are and what the agent's responsibilities are.

But it's also going to allow the client to select the agent, a free choice.

So this document does not pressure the client to have to use that real estate agent or broker.

Mr. Brown was trying to sell his property and hired Broker Kenny to represent him and listed his property with Broker Kenny.

Days after signing the listing agreement, Mr. Brown suddenly passed away.

How does this affect the agency?

A. This terminates the agency.

B. Broker Kenny can still act on behalf of Mr. Brown.

C Broker Kenny must still fulfill his duties in the agency

or D Broker Kenny is owed the promised commission by the next of kin

Correct answer is A This terminates the agency The death of either the principal

or an agent automatically terminates the agency A tenant in common can A,

sell or transfer his interest without the consent of the other tenants in common,

B, use his or her interests in the estate to encumber the entire estate.

C, sell, encumber, or transfer his or her interests only to the other tenants in common.

D, sell, encumber, or transfer his or her interests only with the consent of all the other tenants in common.

The answer to that one is A, sell or transfer his interest without the consent of the other tenants in common.

Now let's read the explanation on this one.

Make sure we have it clear for you.

All tenants in common have distinct and separable ownership of their respective interests.

Co-tenants may sell, encumber, or transfer their interests without obstruction or consent from the other owners.

A co-tenant may not, however, encumber the entire property.

This is a great explanation of investors.

Sometimes you have investors who buy properties together.

Let's assume it's three, four, five investors.

If one investor wants to sell his share, he can.

Tenants in common.

Doesn't need anybody else's permission.

Keep that in mind.

When it comes to tenants in common, you own your percentage.

And when you want to sell it, go for it.

You can.

If both parties agree to back out of a contract, this process is called a rescission, b.

B release, C formation, D novation.

And the answer is A is an apple, rescission.

Rescission is a legal action taken to terminate

or cancel a contract either by mutual consent of the parties to the contract

or by one party when the other party is in breach of the contract.

And rescission is what we normally use in real estate to cancel a contract.

If a joint tenant sells his or her interest to an outside party, what happens next?

A. The new owner becomes a tenant in common with the other

owners who continue to hold a joint tenancy with each other and a tenancy in common with the new owner.

B. The joint tenancy continues with the new owner as the third joint tenant.

C, the joint tenancy terminates and all owners become tenants in common?

Or D, the joint tenancy terminates and the owners must create a new joint tenancy to include the new owner?

Interesting question.

I like this question actually.

Now let's go straight to the answer.

The answer is A, the new owner becomes a tenant in common with the other

owners who continue to hold a joint tenancy with each other and a tenancy in common with the new owner.

Got it?

Now let's go to the explanation.

A joint tenant may transfer his or her interest in the property to an outside party, but only as a tenancy in common interest.

Whoever acquires the interest co-owns the property as a tenant in common with the other joint tenants.

The remaining joint tenants continue to own an undivided interest in the property, lest the new co-tenants share.

Mark's business is failing and he is facing bankruptcy.

He decides to sell his house.

The broker that he employs to list his house tells a prospective buyer

that Mark is facing bankruptcy and may be especially eager to sell, possibly for less than market value.

Which of the following is true regarding the broker's actions?

A the broker's actions are acceptable if they result in the offer on the property.

B The broker's actions are ethical since they are meant to encourage a sell.

C The broker's actions are acceptable as long as he does not give specific financial information about the seller.

Or D The broker's actions are unacceptable unless he has been given the authority by the seller to disclose that information.

Correct answer is D Broker's actions are unacceptable unless he has been given the authority by the seller to disclose that information.

Part of an agent's fiduciary duties is confidentiality.

Agents have a duty to maintain the confidentiality of a client's financial

and personal information unless they are authorized by the client to do otherwise.

A court might grant an easement by prescription if, which are the following?

A, a town needs to dig a trench across an owner's property

to install a sewer line to a neighboring property and the owner refuses permission.

B, a property owner sells the front half of a lot

and wants to continue using the driveway to access the rear of the lot.

C, a trespasser has been using an owner's property for a certain period with the owner's knowledge but without permission.

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And D, a property owner wants to prevent an owner of an adjoining property from building an improvement that blocks her view.

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Another great question.

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An easement by prescription.

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Now here of course we're looking for that term easement by prescription.

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The answer to this one is going to be C.

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A trespasser has been using an owner's property for a certain period with the owner's knowledge but without permission.

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If someone uses another's property as an easement without permission for a statutory period of time

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and under certain conditions a court order may give the user

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the easement right by prescription regardless of the owner's desires for

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a prescriptive easement order to be granted the following circumstances must be true the use has been occurring without permission

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or license the owner knows or is presumed to have known of the use

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and the use has been generally uninterrupted over the statutory prescriptive period broker Devin found a buyer

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and in return he was compensated as promised.

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This is considered an A implied contract B executed contract C executory contract D express contract

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And the answer is B as a boy, executed contract.

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Once an obligation has been completed by one party, this will trigger a following action by the other party,

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which will then deem the contract as executed.

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Just remember, an executed contract simply is an agreed contract.

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Right.

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Or you could say an agreed tender.

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Right.

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So so both parties have agreed to certain conditions that need to be fulfilled.

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Broker Cam listed the Jones's property before finding a buyer.

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Jones's house accidentally burned down.

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How does this affect the agency?

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A Broker Cam is owed commission by the Jones's.

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Joneses.

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B Broker Cam will need to wait for Joneses to fix the property.

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C This terminates the agency or D None of the above.

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Correct answer is C This terminates the agency.

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There's nothing to sell.

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Since Jones is now unable to fulfill his end of the agreement.

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This terminates the agency.

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How is a lien terminated?

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A payment of the debt that is the subject of the lien and recording of the satisfaction?

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B, transfer of the property that has the lien?

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C, recording of another lien that is superior?

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Or D, death of the lien or lienee?

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The answer to that is A, payment of the debt that is the subject of the lien and recording of the satisfaction.

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If you want to get rid of a lien, pay it off.

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Simple as that.

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Let's go to the explanation.

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A lien terminates on payment of the debt and recording of the documents.

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Payment of the debt and recording of the appropriate satisfaction documents ordinarily terminate a lien.

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If a default occurs, a suit for judgment or foreclosure enforces the lien, these actions force the sale of the property.

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Again, bottom line, if a property has a lien on it, you want to get rid of it?

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The easiest way is probably just to pay off the lien, get rid of it.

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Which of the following is not a duty of a broker?

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A. Present the offer to the seller.

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B. Guide the buyer through the contract provisions.

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C. Explain the meaning and the purpose of the contract terms.

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D give legal advice.

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And the answer is D as in dog give legal advice.

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Although a broker may assist in explaining the meaning

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and the purpose of the contract terms he or she is not allowed to provide legal advice.

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So just remember as a real estate agent we're limited in what we can say and do for our clients.

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And even though you may have a law degree or maybe a licensed attorney,

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while you have the real estate hat on, you have to stay in the real estate channel.

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Why?

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Because whatever comes out of your mouth now, you're liable for.

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Of the following, which is an actual type of deed and would most likely not have implied covenants by the grantor?

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A. Quit-claim deed.

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B. Gift deed.

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C. Happy deed. Or D.

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Grant deed.

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The correct answer is A.

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A quit-claim deed.

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Quit-claim deeds have no warranties, covenants, or guarantees.

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The property owner gives Deanna permission to cross his property as a shortcut to her kindergarten school bus.

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One day the property owner dies.

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What right was Deanna granted originally and will it survive the owner's death?

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A. A personal easement in gross which continues after the owner's death.

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An easement by prescription which continues after the owner's death.

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C, a license which continues after the owner's death, or D, a license which terminates upon the owner's death?

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The answer is D, a license which terminates upon the owner's death.

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Now, why is that?

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Let's read the explanation so we can better understand this.

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A license is a personal right that a property owner grants to another to use the property for a specific purpose, to reach the kindergarten school bus in this case.

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Unlike a personal easement in gross, which terminates only on the death of the grantee, a license is revocable at any moment.

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It is not transferable and does not attach to the land.

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It seizes on the death of either party or on the sale of the property.

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If you want to get access, I added the link in the comments and description below.

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This stops anyone from taking a position that is in conflict with the previous position or a previous action?

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A attractive nuisance doctrine.

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B doctrine of agreed boundaries.

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C clean hands doctrine.

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Or D doctrine of estoppel.

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Yep correct answer is D doctrine of estoppel.

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The reason that the doctrine of estoppel stops anyone from taking a position which is in conflict

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with the previous position or a previous action.

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In relation to deeds on real property, which is not true, watch out for not,

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a grant deed conveys title even if not specifically stated, b a quitclaim deed may convey fee simple title,

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c delivery of the deed is essential to the transfer of title,

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or D, a reconveyance deed is issued by a trustee to convey title to a new purchaser in a trustee sale.

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Correct answer is D, a reconveyance deed is issued by a trustee to convey title to a new purchaser in a trustee sale.

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A reconveyance deed is used in order to return the title

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held by the trustee under the deed of the trust to the original truster.

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Or basically, when your loan gets paid off, they give you a conveyance deed.

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A homeowner goes bankrupt and the lender forecloses on her residence.

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In the foreclosure sale, the proceeds are insufficient to pay off the loan.

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And the court orders other properties sold to cover the shortfall.

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This action is called what?

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A. Strict foreclosure.

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B. Suit for specific performance.

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C. Equity foreclosure judgment. Or D.

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Deficiency judgment.

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Now the answer to that is D.

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Deficiency judgment.

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Now why is it deficiency judgment?

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Let's go to the explanation so we better understand this.

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Whenever there are insufficient funds to retire a defaulted and foreclosed mortgage loan,

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a deficiency judgment may be ordered if allowed by law to make up the difference.

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To comply with the judgment, the borrower must raise additional funds

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from other sources to make up the difference between the outstanding loan

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and the balance owed and the proceeds from the foreclosure sale.

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Which of the following is not true regarding a negligent misrepresentation?

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A. It is the result of carelessness.

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B, it carries criminal penalties.

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C, there is no criminal intent to deceive.

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D, it can result in civil damages.

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And the answer is B as a boy.

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It carries criminal penalties.

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A negligent misrepresentation may only result in a voidable contract,

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civil damages and disciplinary actions against the licensee.

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It does not, however, carry criminal penalties.

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Broker Mick is showing a property to buyer Stephanie, and he is aware that the basement of the property has occasional flooding.

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Is Broker Mick required to disclose this to buyer Stephanie?

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A. Yes, this is a material fact and must be disclosed.

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B. No, it is not required to disclose this information since the flooding is not constant.

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C. No, this is not required as it may jeopardize the sale of the property. Or D.

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Broker Mick has no obligation to disclose the flooding issue

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and can refuse to disclose this information if he chooses to do so.

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Correct answer is A.

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Yes, this is a material fact and must be disclosed.

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Flooding hazards in a property are considered to be material facts and must be disclosed, if aware, by the seller or the agents.

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A non-profit organization wants to erect an urgent care facility in a residential zone.

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Given other favorable circumstances, the local authorities may grant permission by allowing what?

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A. A special exception.

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B. An illegal conforming use.

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C. An easement or D.

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A license?

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The answer is A.

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A special exception.

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A special exception grant authorizes a use that is not consistent with the zoning ordinance in a literal sense.

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Yet it is clearly beneficial or essential to the public welfare and does not materially impair other uses in the zone.

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What is usually the only help available for an owner facing foreclosure?

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A. A speedy sale B.

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Probate sale C.

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Bargain and sale deed D.

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Installment sale And the answer is A is an apple, a speedy sale.

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When a notice of default is recorded on a property,

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the owner is notified by the lender that the homeowner borrower has failed to make payments on the loan as agreed upon,

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and the lender has initiated the foreclosure process.

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A speedy sale is usually the best option for the homeowner to avoid a foreclosure.

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So a couple of things with regards to a speedy sale.

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Number one, if you are an agent that's going to be focusing on foreclosed properties,

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you're going to want to make sure that your escrow is completed on or before the date of the set auction date.

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Number two, you want to make sure that your homeowner knows that selling their house

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more than likely will not create any kind of profit for them.

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Selling their house is just a means of getting them out of the debt situation that they're in right now.

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This allows an agent to fairly represent the principal's interest.

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A. Loyalty B.

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Good faith and honesty C.

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Disclosure Or D.

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Obedience Correct answer is B, good faith and honesty.

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The agent's fulfillment of the duties of good faith and honesty will allow the agent to fairly represent the principal's interest.

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This certain legal description contains the phrase, northwesterly along the Erie Road to the P.O.B.

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What kind of description is this?

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A, plat survey.

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B, government grid.

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C, meets and bounds.

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D. Rectangular survey.

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The answer to that one is...

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C. Meets and bounds.

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Let's go straight to the explanation.

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A meets and bounds description identifies the point of beginning

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and describes the distance and direction from that point to the first monument,

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and thence to subsequent monuments and back to the beginning to define the property's enclosed perimeter.

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Jean was tricked into signing over the rights to her apartment by day while she was drunk.

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This contract is considered a voidable,

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b unenforceable, c valid, d void.

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And the answer is a as in apple, voidable.

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A contract entered into under the influence of alcohol is deemed voidable once proven.

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So the difference between voidable and voided contracts, right?

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So a voided contract means that some law has been broken and it's automatically voided.

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Both parties don't have a say so as to whether they want the contract to move forward or not.

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an avoidable contract situation, the person who signed under duress

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has a choice in the matter and can choose to either cancel the contract or move forward with the contract.

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So just remember, in an avoidable contract situation, there's a choice in the matter.

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Which of the following would be an example of misrepresentation?

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A. An agent makes a statement about a property that she does not know to be true but should have known.

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B. An agent makes a statement about the property

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and makes no effort to determine

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if it is accurate c a seller makes a statement about the property

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that she knows is false

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or d all of the above the correct answer is d

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all of the above all of the following scenarios are examples of misrepresentation misrepresentation is defined as a false

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or misleading statement whether the misrepresentation was intentional

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or otherwise a buyer submits an offer to a seller and then unfortunately dies in a car accident.

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Before learning of the buyer's death, the seller accepts the offer.

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Which of the following is true?

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A. The seller can force the buyer's estate to go through with the purchase.

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B. The buyer's death terminated the offer.

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C. The seller must make a new offer with the same terms to the buyer's heirs.

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D. The buyer's heirs have the option of enforcing the contract.

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What's the answer?

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The answer is B.

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The buyer's death terminated the offer.

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Let's go to the explanation on this one.

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Any of the following actions or circumstances can terminate an offer.

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Acceptance, rejection, revocation, lapse of time, counteroffer, or death or insanity of either party.

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Bottom line is this, you have a contract between A and B.

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If either one of them no longer exists, boom, no longer is the contract valid.

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The total positive balances of all the beneficiaries in a broker's trust fund account must always equal the accounts A equilibrium,

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B, balance.

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C, minimums.

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D, none of these.

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And the answer is B as a boy, balance.

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The sum of all the beneficiaries' balances must equal the total balance in the trust fund.

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So in a trust fund,

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just remember money being deposited into that account has specific instructions as to how the money can be spent.

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So every month by law the brokerage holding the trust account is required to send a statement to the person

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that trusted the money to the brokerage

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and give them an itemized statement to the penny of how the money was spent for that month.

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This term refers to compensation in any form

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that is received by a real estate licensee without the knowledge of the licensee's client.

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A. Pre-payment penalty.

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B. Payment bond.

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C. Secret profit.

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D. Entrepreneurial profit.

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Correct answer is C, secret profit.

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Yeah, it's kind of right there in the name.

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A secret profit is a profit of the agent that is not fully disclosed to the principal.

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Agent Jerry has executed an exclusive buyer broker agreement with the Anderson.

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So we've got Agent Jerry now representing the Andersons.

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The agent subsequently places an offer with Melinda, the exclusive selling agent for the Lincolns to buy their lakefront property.

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The offer contains provisions for the Lincolns to pay the brokerage commission, which Lincolns agree to.

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Given this set of circumstances, Jerry owes the full set of fiduciary duties to who?

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The Andersons?

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The Lincolns?

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Jerry's broker?

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Or Melinda's broker?

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Now these kind of questions, I want you to read them carefully.

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I want you to understand who represents who.

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I want you to understand who's the principal and who's the third party.

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The answer to this one is A.

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The Andersons.

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Since Jerry executed an agency agreement with the Andersons, they become the client and the Lincolns of the customer, regardless of who pays the commission.

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A typical real estate purchase contract is A.

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Express B.

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Unilateral C bilateral, D implied and the answer is C as in Charlie bilateral.

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A bilateral contract is an agreement in which both parties make a promise to do something or to refrain from doing something

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and both are obligated to fill the promise.

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So just to go over the four choices here just remember an express contract is a contract

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that is stated verbally or written.

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An implied contract is based on behavior, right?

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An implied contract is an expectation.

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It's somewhat elusive, but it's expected, right?

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Now, a unilateral contract means, well, basically there would not be a unilateral contract it'd be a unilateral agreement.

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Essentially only one party is required to sign that agreement.

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Typically a unilateral document in real estate would be an advisory of some sort,

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warning perhaps the buyer that if this happens then this will happen.

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A bilateral contract just means that both buyer and seller have signed a contract agreeing to certain terms and conditions

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for that real estate transaction.

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Which of the following is a principle liable for?

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A. Torts committed by an agent who is an employee acting in the scope of the employment.

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B, his or her own acts C, acts of an agent or sub-agent that were performed on the principal's behalf or D,

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all of these Correct answer is D, all of these As long as an agent and

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or a sub-agent is authorized by the principal he

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or she will be held responsible for the actions of both The principal discloses that she would sell a property for $500,000

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During the listing period, the house is listed and marketed for $530,000.

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Typical scenario.

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The principal is willing to take $500,000, but they're going to start the price at $530,000.

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No offers come in and the listing expires.

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Three weeks later, the agent confides to a customer that the seller would have sold for less than the listed price.

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Which of the following is true?

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A, the agent has violated the duty of confidentiality.

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B, the agent has fulfilled all fiduciary duties since the listing has expired.

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C, the agent is violating the duties owed this customer.

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Or D, the agent has created a dual agency situation with the customer.

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The answer is A, the agent has violated the duty of confidentiality.

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Let's go to the explanation.

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An agent may not disclose any information that would harm the client's interest or bargaining position, or anything else the client wishes to keep secret.

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The confidentiality standard is one of the duties that extends beyond the termination of the contract.

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At no time in the future, may the agent disclose confidential information.

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This is a great point, and this question is actually very important.

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When you have a relationship with your principal, confidentiality is at the top of the list.

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They may give you information that they do not want you to share with anyone.

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That, in this case, with this question, goes to confidentiality.

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This type of contract is established by the conduct of the parties without a specific oral or written agreement.

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A executed contract.

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B express contract.

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C executory contract.

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D implied contract.

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And the answer is D as in dog implied contract.

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An implied contract is an agreement that can be established from the conduct of the parties rather than an express agreement.

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So again, remember an express agreement is an agreement

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that is either verbally said to the other party or written in a contract, right?

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An implied agreement is more of an expectation.

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It's based more so on behavior than anything else.

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A grant deed is executed when A.

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Signed by the grantor B.

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Recorded C.

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Delivered or D.

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Delivered to title Correct answer is A.

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Signed by the grantor A document is executed when signed by the grantor A buyer agent or tenant representative

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should disclose his or her agency relationship to the owner's agent When?

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Answer A.

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Immediately prior to the initial contact.

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Answer B.

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Upon initial contact.

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C. Immediately prior to substantive contact. Or D.

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Immediately following any offer executed by the landlord.

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The answer is B.

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Upon initial contact.

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Let's go to the explanation.

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A buyer Our agent must disclose the agency relationship to the seller or seller's agent on first contact.

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Substantive contact is assumed to occur immediately in this circumstance.

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Who would be responsible for the paved streets, utilities, curbs, sidewalks, and drain gutters in a new subdivision?

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A. The local city council.

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D, the local water and power department.

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C, the residents residing in the new development.

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D, the developer.

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And the answer is D as in dog, the developer.

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The developer is responsible for the infrastructure within a new subdivision.

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So just remember, the local governments authorize the developer to create the infrastructure,

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but ultimately it's the developer that does the grunt work.

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They're the ones that actually dig the trenches, lay the pipes down and so forth.

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And so they would be responsible for any of the utilities and so forth.

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Scenario question.

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Here it goes.

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A broker obtains an exclusive listing.

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It's a nice day, they got an exclusive listing to sell a house.

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But after two months, the broker abandons the listing because the seller is too demanding and hot-tempered.

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What can the seller do in this situation?

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So in a sense, the broker quit and left the seller out in the dark.

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What can the seller do?

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A, have the license revoked for negligence.

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D, sue the broker for money damages.

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C, sign a listing agreement with another broker and force the first broker to pay the commission.

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D. Force the broker to perform the contract without compensation.

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The answer to that is B.

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Sue the broker for money damages.

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If the broker cancels the listing or otherwise defaults, the client may sue the broker for money damages damages.

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A contract wherein each party has a specific obligation to perform is referred to as A

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or an A express contract B divisible contract C unilateral contract or D bilateral contract.

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Correct answer is D bilateral contract.

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A bilateral contract is an agreement in which both parties

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make a promise to do something or refrain from doing something and both are obligated to fulfill the promise.

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A property owner agrees to pay a broker an open-ended commission as a difference between the sale price

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and the net amount provided the owner receives a minimum amount of proceeds from the sale at closing.

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This is an example of A.

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Exclusive right to sell agreement B.

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Exclusive agency agreement?

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C. Open listing or D.

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Net listing?

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The answer to that is net listing.

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Explanation.

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A net listing is one in

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which an owner sets a minimum acceptable amount to be received from the transaction

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and allows the broker to have any amount received in excess as a commission, assuming the broker has earned a commission according to the other terms of the agreement.

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Which of the following is not a way to terminate an agency?

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A, expiration of the term of the agreement.

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B, fulfillment of the agency agreement.

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C, destruction of the property.

468

D, none of these.

469

And the answer is D as in dog, none of these.

470

All listed items allow the termination of an agency.

471

In obtaining offers from a buyer, an agent must be careful too.

472

A. Pursue only those offers which are at or near the listing price.

473

B. Balance the owner's price expectations with the buyer's opinion of value.

474

C. Avoid disclosing what price the owner will accept. Or D.

475

Avoid offers that are beneath market value.

476

The answer to that is C.

477

Avoid disclosing what price the owner will accept.

478

Explanation.

479

An agent must be extremely careful at this point to abide by fiduciary obligations to the client, to their principal, whoever that party may be.

480

Discussions of price are particularly delicate, whether the client is a buyer or seller.

481

The agent's duty is to uphold the client's best interest.

482

Thus, this is not acceptable to suggest to a customer what price the client will or will not accept.

483

It goes back to the old confidentiality.

484

You want to keep things confident when it comes to price and hold that to you and your principal at all times.

485

There's no need to share your client's information to others.

486

Who is responsible for all the acts of the associate licensee with regard to duties owed to the principal,

487

third party and other brokers?

488

A third party B associate licensee C principal or D designated broker.

489

Correct answer is D designated broker.

490

In most cases, all the listings in a real estate company belong to the broker and not the associate licensee.

491

A town is rapidly growing, but all the buildable vacant lots in the most desirable areas have already been occupied.

492

In this case, it is likely that the price of existing homes in that area will do what?

493

So we have limited land in this very desirable area.

494

What's going to happen to the existing homes in this area?

495

A, they will stabilize since the population must stabilize.

496

B, will increase in value.

497

C, will decline since no further building can take place.

498

Or D, will not show any predictable movement.

499

The answer is B, will increase.

500

The value will increase.

501

The price of these homes will increase.

502

Why?

503

Let's go to the explanation.

504

If there is no longer a supply to meet this increasing demand of a growing population, prices for existing supply will rise.

505

An agent cannot reveal any personal information made known to them by the principle.

506

This refers to the duty of A.

507

Loyalty B.

508

Confidentiality C.

509

Disclosure D.

510

Obedience Correct answer is B.

511

Confidentiality.

512

An agent must respect the confidentiality of personal information given to him by the principal.

513

To avoid violating the Real Estate Settlement Procedures Act,

514

also known as RESPA, parties who are providing services to the buyer or seller in the transaction must do the following.

515

Be paid before the closing date for any service they provide.

516

B Inform the closing agent of the cost of their services at least one week before the closing date.

517

C. Receive payment only from the funds held in escrow, not directly from buyer or seller. Or D.

518

Disclose in writing any business relationships they have with other parties involved in the transaction.

519

The answer is D.

520

Disclose in writing any business relationships they have with other parties involved in the transaction.

521

Business relationships and affiliations among real estate firms, mortgage brokers, title insurance firms and other such companies that are involved in the transactions are permitted,

522

provided the relationships are disclosed, disclosed, disclosed in writing to the consumer.

523

The consumer is free to go elsewhere for the relevant service and the companies do not exchange fees for referrals.

524

Again, disclose, disclose, disclose everything, including relationships professionals have with each other.

525

The best form of ownership interest one can acquire in real estate is the following.

526

A. Legal life estate.

527

B. Conventional life estate.

528

C. Defeasible fee simple estate. Or D.

529

Absolute fee simple estate.

530

The answer is D.

531

Absolute fee simple estate.

532

I want you to look at that word absolute.

533

There's no doubt when you see the word absolute it's got to be this answer.

534

it is.

535

Absolute fee simple estate.

536

Let's go to the explanation.

537

The fee simple freehold estate is the highest form of ownership interest one can acquire in real estate.

538

It includes the complete bundle of rights and the tenancy is unlimited with certain exceptions.

539

The fee simple absolute estate is a perpetual estate that is not conditioned by stipulated or restricted uses.

540

It's the best form of home ownership.

541

Absolute fee simple estate.

542

Which of the following does not describe an adjustable rate mortgage?

543

A, a variable interest rate loan.

544

B, a loan characterized by a fixed rate interest,

545

usually one tied to a bank or savings and loans association cost of funds index.

546

C. A financial instrument whose interest rate will vary according to the change in the identified index or rate.

547

D. A financing technique in which the lender can raise or lower the interest rate according to a set index,

548

such as the rate on six-month treasury bills or the average cost of funds of FDIC insured institutions.

549

And the answer is B, a loan characterized by fixed interest rate,

550

usually one tied to a bank or savings and loan association cost of funds index.

551

This statement is false because interest rates vary in an adjustable rate mortgage.

552

So just remember what an adjustable rate mortgage is, right?

553

It's a mortgage payment that varies according to the interest rates.

554

A seller revokes an exclusive right to sell listing two months prior to expiration.

555

The reason stated, the seller is too busy to meet with the agent.

556

In this case, which of the following will occur?

557

A. The seller is criminally liable for negligence.

558

B. The seller may be liable for a commission and marketing expenses.

559

C. The agent can sue the seller for specific performance even if no customer had been located. Or D.

560

The agent must accept the revocation without the possibility of damage recovery.

561

And the answer is B.

562

The seller may be liable for commission and marketing expenses.

563

Here's the explanation.

564

With an exclusive right to sell listing, if the property sells during the term of the revoked listing, the seller is liable for the commission.

565

If the property does not sell, the seller is liable for the broker's actual costs.

566

Which of the following is necessary to establish mutual consent in real estate contracts?

567

A consideration that is unknown or not specific.

568

B illegal use C recording and acknowledgement or D an offer and acceptance.

569

Correct answer is D an offer and acceptance.

570

Mutual consent in real estate contracts is formed when the first party makes an offer.

571

The offer is accepted without qualification and the second party communicates this acceptance to the first party.

572

Now here's a math question for you.

573

The roof of a property costs $20,000.

574

The economic life of the roof is 20 years.

575

Assuming the straight line method of depreciation, what is the depreciated value of the roof after three years?

576

577

20,000.

578

579

17,000.

580

581

14,000. Or D.

582

3,000. is b, 17,000.

583

Let's go straight to the explanation.

584

First derive the annual depreciation, which is the cost divided by the economic life.

585

In this case it would be 20,000 divided by the 20 years.

586

Then multiply annual depreciation times the number of years to identify the total depreciation.

587

Remember to subtract depreciation from the original cost of 20,000 if the question ask for the ending value.

588

Thus, 20,000 divided by the 20 years times three years equals $3,000 total depreciation.

589

The ending value is $20,000 minus $3,000, which is equivalent to $17,000.

590

Congrats on finishing the practice exam.

591

Do me a favor, comment below and share how many questions you got right.

592

Then watch this video right here next.

593

It's going to help you prepare with more study questions for that state exam.

What is the Shadowing Technique?

Shadowing is a science-backed language learning technique originally developed for professional interpreter training and popularized by polyglot Dr. Alexander Arguelles. The method is simple but powerful: you listen to native English audio and immediately repeat it out loud — like a shadow following the speaker with just a 1–2 second delay. Unlike passive listening or grammar drills, shadowing forces your brain and mouth muscles to simultaneously process and reproduce real speech patterns. Research shows it significantly improves pronunciation accuracy, intonation, rhythm, connected speech, listening comprehension, and speaking fluency — making it one of the most effective methods for IELTS Speaking preparation and real-world English communication.

Shadowing Practice: 100 Texas Real Estate Exam Questions (51-100, Part 2) - Learn English Speaking with Video

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What is the Shadowing Technique?