Free North Dakota Real Estate Practice Exam

Q1.Which type of property estate provides the owner with the greatest bundle of rights?

• A.Life estate
• B.Fee simple determinable
• C.Fee simple absolute
• D.Leasehold estate

Q2.Under RESPA Section 8, what is the maximum penalty for paying or receiving an unearned fee or kickback in connection with a federally related mortgage loan?

• A.$1,000 fine and/or up to 1 year imprisonment
• B.$5,000 fine and/or up to 2 years imprisonment
• C.$10,000 fine and/or up to 1 year imprisonment
• D.$25,000 fine and/or up to 5 years imprisonment

Q3.A property was purchased for $180,000 and sold for $225,000. What is the percentage of profit on the original investment?

• A.20%
• B.25%
• C.30%
• D.35%

Q4.Under federal fair housing laws, which statement about familial status is correct?

• A.Familial status only protects families with children under 18
• B.Properties can exclude families with children if they are 55+ communities with proper certification
• C.Landlords can refuse to rent to pregnant women to avoid future noise complaints
• D.Single parents receive less protection than married couples with children

Q5.Which appraisal approach is most commonly used for single-family residential properties?

• A.Cost approach
• B.Income approach
• C.Sales comparison approach
• D.Gross rent multiplier approach

Q6.What is the primary difference between a condominium and a cooperative form of ownership?

• A.Condominiums are always commercial while cooperatives are residential
• B.Condominium owners hold fee simple title to their unit, while cooperative owners hold shares in a corporation
• C.Cooperatives require board approval for sales while condominiums do not
• D.Condominiums have monthly fees while cooperatives do not

Q7.FHA loans are attractive to many first-time homebuyers primarily because they:

• A.Require no mortgage insurance
• B.Have no income limitations
• C.Allow down payments as low as 3.5%
• D.Can be used for investment properties

Q8.In most states, agency disclosure must be made:

• A.Only to buyers, not sellers
• B.Only to sellers, not buyers
• C.To all parties in the transaction
• D.Only when problems arise

Q9.According to NDAC 70-02-03-08, what is the minimum record retention period for trust account records that brokers must maintain?

• A.2 years from the date of closing
• B.3 years from the date of closing
• C.5 years from the date of closing
• D.7 years from the date of closing

Q10.A rectangular lot measures 150 feet by 200 feet. If the lot is worth $8 per square foot, what is the total value?

• A.$240,000
• B.$2,800
• C.$30,000
• D.$120,000

Q11.Which of the following charges may NOT be included in the finance charge under the Truth-in-Lending Act?

• A.Loan origination fees
• B.Discount points paid by the borrower
• C.Title insurance premiums
• D.Private mortgage insurance premiums

Q12.Under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), who can be held liable for environmental cleanup costs?

• A.Only the current property owner
• B.Only the party who caused the contamination
• C.Current owners, past owners, operators, and parties who arranged for disposal
• D.Only commercial property owners

Q13.What is the main difference between a conventional loan and an FHA loan?

• A.Conventional loans require mortgage insurance while FHA loans do not
• B.FHA loans are insured by the government while conventional loans are not
• C.Conventional loans have higher interest rates than FHA loans
• D.FHA loans can only be used for investment properties

Q14.Which of the following is true about assistance animals under fair housing law?

• A.Assistance animals must be certified or registered with a national registry
• B.Landlords may charge a pet deposit for an assistance animal
• C.An emotional support animal is not a pet and is protected under the FHA
• D.Only dogs and miniature horses qualify as assistance animals

Q15.What must be disclosed when an agent has a personal interest in a property transaction?

• A.Nothing, as long as the agent is licensed
• B.The agent's personal interest must be fully disclosed to all parties
• C.Only the agent's commission amount
• D.The disclosure can be made verbally at closing