Free Rhode Island Real Estate Practice Exam

Q1.Under the Truth-in-Lending Act (TILA), which figure must be prominently disclosed to a borrower so they can compare the true cost of credit across different lenders?

• A.The principal loan balance
• B.The monthly payment amount
• C.The Annual Percentage Rate (APR)
• D.The lender's profit margin

Q2.In property management, what does the term 'effective gross income' represent?

• A.Total potential rental income minus operating expenses
• B.Total potential rental income minus vacancy and collection losses
• C.Net operating income minus debt service
• D.Gross rental income plus miscellaneous income

Q3.Under Rhode Island law, when must a real estate licensee provide the mandatory agency disclosure form to a prospective buyer?

• A.At the first substantive contact with the prospective buyer
• B.Only after a purchase and sale agreement has been signed
• C.At the time of the first property showing
• D.Within 24 hours after an offer is presented

Q4.In Rhode Island, a salesperson's employing broker is audited by the Rhode Island Department of Business Regulation and is found to be routinely depositing client earnest money funds into the same bank account used to pay office overhead and staff salaries. This practice is best described as:

• A.Conversion, because the funds were used directly for personal gain.
• B.Commingling, which is a violation of R.I. Gen. Laws § 5-20.5-20 and subjects the broker's license to disciplinary action.
• C.An acceptable practice if the broker maintains detailed accounting records separating the funds on paper.
• D.Permissible provided client funds are never overdrawn and are available at closing.

Q5.Under Rhode Island General Laws § 5-20.5-11, what is the license renewal period for a Rhode Island real estate salesperson license?

• A.Every year on the salesperson's birthday
• B.Every two years, by the licensee's birthday in even or odd years based on the birth year
• C.Every three years on a fixed calendar date
• D.Every four years aligned with the national election cycle

Q6.A salesperson is working with a buyer who is applying for a mortgage. The lender provides the buyer with a Loan Estimate within three business days of receiving the loan application. Under which federal law is the lender required to provide this disclosure?

• A.The Real Estate Settlement Procedures Act (RESPA)
• B.The Equal Credit Opportunity Act (ECOA)
• C.The Truth in Lending Act (TILA) as implemented by Regulation Z
• D.The Home Mortgage Disclosure Act (HMDA)

Q7.A bank statement ends at $18,400. Deposits in transit are $900 and valid outstanding checks are $600. What is the adjusted bank balance?

• A.$16,900
• B.$18,100
• C.$18,700
• D.$19,900

Q8.A Rhode Island salesperson places an advertisement for a property listing on a social media platform. Under Rhode Island law and Commission rules, what information must be included in the advertisement?

• A.The salesperson's personal cell phone number and home address.
• B.The name of the licensed brokerage under which the salesperson is affiliated.
• C.The full text of the listing agreement, including the commission rate.
• D.The seller's name and the listing price approved by the seller in writing.

Q9.Under the Rhode Island Seller's Property Disclosure Act, which of the following properties is generally EXEMPT from the requirement to provide a seller's property condition disclosure form?

• A.A transfer of a property being sold as part of an estate sale where the personal representative has never occupied the property
• B.A single-family home being sold by an owner who has lived there for five years
• C.A condominium unit being sold by an investor who purchased it as a rental
• D.A two-family home being sold by a landlord who occupies one unit

Q10.A property is purchased for $180,000. The land is valued at $30,000 and the improvement at $150,000. Using straight-line depreciation over a 27.5-year useful life (as required by IRS guidelines for residential rental property), what is the annual depreciation deduction?

• A.$6,545.45
• B.$5,454.55
• C.$6,000.00
• D.$4,909.09

Q11.A property's assessed value is $275,000, and the local assessment ratio is 80%. The tax rate (mill rate) is 25 mills. What is the annual property tax owed?

• A.$6,875.00
• B.$5,500.00
• C.$4,400.00
• D.$3,437.50

Q12.An unlicensed leasing-desk employee offers an applicant a lower rent that was not authorized by the owner or broker. What is the principal concern?

• A.The offer is permissible if occupancy is low
• B.The employee has moved beyond the limited exemption into negotiation
• C.The offer is valid if made orally
• D.The employee only needs to disclose the change after move-in

Q13.Under the Fair Housing Act, which scenario would constitute illegal discrimination based on familial status?

• A.Refusing to rent a studio apartment to a family of four due to legitimate occupancy standards
• B.Advertising 'adults only' for a 55+ senior housing community that qualifies for the housing for older persons exemption
• C.Requiring all tenants to provide references regardless of family composition
• D.Requiring higher security deposits from families with children due to potential property damage

Q14.A team ad makes the team look like a separate brokerage. What is the best correction?

• A.Remove the employing broker name.
• B.Make the employing broker legal name or licensed DBA clear and prominent and follow current team guidance.
• C.Create a second license for the team name automatically.
• D.Limit the ad to social media.

Q15.A seller discovers structural damage after signing a purchase contract but before closing. The seller has no legal obligation to disclose this information to the buyer. What principle does this scenario violate?

• A.Caveat emptor
• B.Material fact disclosure
• C.Stigmatized property rules
• D.As-is sale provisions