Illinois Real Estate Exam Version 2
Practice exam for Salesperson and Broker License Exam under Real Estate Exams (Licensing Exams). 5 sample questions.
Sample Questions
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Question 1
When a mortgage loan with level period payments has been completely repaid by its maturity date, it is said to be
Correct Answer: C
Rationale: Fully amortized (C) is correct because it describes a loan repaid in full by its maturity through regular payments covering principal and interest. Depreciated (A) relates to asset value loss, not loan repayment. Capitalized (B) refers to adding costs to an asset’s value, not loan repayment. Refinanced (D) means replacing an existing loan with a new one, not completing repayment.
Rationale: Fully amortized (C) is correct because it describes a loan repaid in full by its maturity through regular payments covering principal and interest. Depreciated (A) relates to asset value loss, not loan repayment. Capitalized (B) refers to adding costs to an asset’s value, not loan repayment. Refinanced (D) means replacing an existing loan with a new one, not completing repayment.
Question 2
The clause in a mortgage that allows the lender to call the entire balance due and payable in advance of the fixed payment date is
Correct Answer: A
Rationale: An acceleration clause (A) is correct because it allows the lender to demand full repayment if certain conditions are violated. An escalation clause (B) adjusts payments or prices based on specific conditions, not full balance demands. A pay-off clause (C) is not a standard term in mortgages. A satisfaction clause (D) relates to loan fulfillment documentation, not early repayment demands.
Rationale: An acceleration clause (A) is correct because it allows the lender to demand full repayment if certain conditions are violated. An escalation clause (B) adjusts payments or prices based on specific conditions, not full balance demands. A pay-off clause (C) is not a standard term in mortgages. A satisfaction clause (D) relates to loan fulfillment documentation, not early repayment demands.
Question 3
In preparing a seller's net proceeds estimate, which of the following would be considered as a cost to the seller?
Correct Answer: B
Rationale: Commission paid to the broker (B) is correct because it is a direct cost deducted from the seller’s proceeds in a real estate transaction. Anticipated property tax increase (A) is a future expense, not a current cost. Mortgage application fee (C) and mortgage title insurance (D) are typically buyer’s costs, not seller’s.
Rationale: Commission paid to the broker (B) is correct because it is a direct cost deducted from the seller’s proceeds in a real estate transaction. Anticipated property tax increase (A) is a future expense, not a current cost. Mortgage application fee (C) and mortgage title insurance (D) are typically buyer’s costs, not seller’s.
Question 4
In Illinois, can a licensee ever legally act on behalf of a lessor and lessee in a transaction?
Correct Answer: B
Rationale: Informed written consent of all parties (B) is correct because Illinois allows dual agency with written consent from both lessor and lessee, ensuring transparency. Approval of the sponsoring broker (A) alone is insufficient. Illinois being a designated agency state (C) doesn’t prohibit dual agency with consent. The License Law (D) allows dual agency with proper consent, not prohibits it.
Rationale: Informed written consent of all parties (B) is correct because Illinois allows dual agency with written consent from both lessor and lessee, ensuring transparency. Approval of the sponsoring broker (A) alone is insufficient. Illinois being a designated agency state (C) doesn’t prohibit dual agency with consent. The License Law (D) allows dual agency with proper consent, not prohibits it.
Question 5
In Illinois, a licensee is subject to disciplinary action for FAILING to
Correct Answer: C
Rationale: Maintaining a separate escrow account for each sale (C) is correct because Illinois law requires licensees to keep client funds in separate escrow accounts to avoid commingling. Notarizing all papers (A) isn’t a universal requirement. Paying state income tax (B) is a personal obligation, not a licensing issue. Auditing escrow accounts (D) isn’t mandated for each sale.
Rationale: Maintaining a separate escrow account for each sale (C) is correct because Illinois law requires licensees to keep client funds in separate escrow accounts to avoid commingling. Notarizing all papers (A) isn’t a universal requirement. Paying state income tax (B) is a personal obligation, not a licensing issue. Auditing escrow accounts (D) isn’t mandated for each sale.