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Real Estate New Jersey Real Estate Salesperson Sample Questions:

1. A real estate licensee is a partial owner of a local inspection company. It is permissible for the licensee to tell all clients to use this company when:

A) the client does not ask for other recommendations
B) it is in the best interest of the client
C) the licensee does not know any of the other title companies in the area
D) the licensee discloses the interest in the company to the client

2. A seller is offering his property for sale in as-is condition. A buyer enters into a contract with the seller and has the home inspected. The inspection reveals a latent defect known to, but not disclosed by, the seller. The buyer:

A) can void the contract due to the seller's failure to disclose the latent defect.
B) can force the seller to correct the defect.
C) must go through with the purchase because the house is being sold as is.
D) can reduce the contract sales price by the cost of correcting the defect.

3. The following statement was found in a real estate sales contract: "In the event of a default by the purchaser, the forfeiture of the earnest money to the seller will be the only compensation to which the seller will be entitled." This statement most likely describes a:

A) indemnification clause
B) liquidated damages clause
C) default delivery clause
D) broker protection clause

4. A low loan-to-value ratio indicates a:

A) lower equity in the property.
B) greater use of leverage.
C) higher equity in the property.
D) greater risk of foreclosure.

5. A broker may legally refuse to accept a listing:

A) only if the seller cannot give clear title to the property.
B) under no circumstances; all owners are entitled to professional representation in the sale of their property.
C) only if the owner's instructions are illegal.
D) at any time, for any legitimate reason.

Solutions: