Free Washington Real Estate Practice Exam

Q1.A Washington salesperson receives earnest money from a buyer on a Friday afternoon after the firm's bank has closed. Under Washington law, when must the earnest money be deposited into the firm's trust account?

• A.By the close of the next banking day after receipt
• B.Within 24 hours of receipt, regardless of banking hours
• C.No later than three banking days after all parties have signed the purchase and sale agreement
• D.At closing, since funds do not need to be deposited until the transaction is finalized

Q2.During the eviction process for non-payment of rent, which federal constitutional principle requires that tenants be given proper notice and an opportunity to be heard before being removed from the property?

• A.Due Process Clause
• B.Equal Protection Clause
• C.Commerce Clause
• D.Supremacy Clause

Q3.Washington's real estate licensing law requires that a firm maintain transaction records for a specified period of time. Under WAC 308-124C-105, how long must a real estate firm retain transaction documents, including purchase and sale agreements and closing statements?

• A.One year from the date of closing or termination of the transaction
• B.Three years from the date of closing or termination of the transaction
• C.Five years from the date of closing or termination of the transaction
• D.Seven years from the date of closing or termination of the transaction

Q4.Marcus, a Washington licensee, is working with a buyer who has not yet signed a written buyer agency agreement. The buyer asks Marcus to write an offer on a home listed by a different firm. Under RCW 18.86, Marcus is by default acting as:

• A.A seller's subagent, because the cooperating listing firm's agency flows to all participants
• B.A buyer's agent, because Washington law defaults to buyer agency when assisting an unrepresented buyer
• C.A dual agent, because he must assist both the buyer and the seller to complete the transaction
• D.A non-agent facilitator, because no written agency agreement has been signed

Q5.When a buyer breaches a real estate contract by failing to close, what is the most common remedy available to the seller?

• A.Keeping the buyer's earnest money as liquidated damages
• B.Specific performance to force the buyer to complete the purchase
• C.Suing for the full purchase price
• D.Automatically transferring title to a backup buyer

Q6.Under the Truth-in-Lending Act (TILA), if a lender fails to provide the required loan estimate within three business days of receiving a complete loan application, what remedy is available to the borrower?

• A.The borrower can cancel the contract without penalty
• B.The lender must pay statutory damages to the borrower
• C.The loan application is automatically approved
• D.The interest rate must be reduced by 1%

Q7.When a broker learns that a buyer client is sending unwanted personal messages to an agent, the broker's obligation is to:

• A.Ignore it — clients are not brokerage employees and cannot create liability
• B.Wait for the agent to file a formal police report before acting
• C.Refer the agent to a different broker to avoid conflict of interest
• D.Take action: restrict communications, set written boundaries with the client, and if necessary terminate the buyer agency agreement

Q8.A broker represents a seller under an exclusive right-to-sell listing agreement. During the listing period, the broker learns that the property is located near a former industrial site that has been identified as a Superfund site under CERCLA. The seller instructs the broker to keep this information confidential and not disclose it to prospective buyers. What is the broker's MOST appropriate course of action?

• A.Honor the seller's instruction, because the broker's fiduciary duty of obedience to the seller requires following all lawful client directives.
• B.Disclose the proximity to the Superfund site to all prospective buyers, because the broker has an independent duty to disclose known material facts that may affect the property's value or desirability, regardless of the seller's instruction.
• C.Disclose the information only if a buyer specifically asks about environmental hazards, because volunteering unsolicited information violates the seller's right to confidentiality.
• D.Withdraw from the listing immediately without any obligation to disclose the environmental information, because disclosure would breach the listing agreement.

Q9.A Washington real estate broker's license expires and the licensee places the license on inactive status rather than renewing it as active. Under RCW 18.85 and WAC 308-124, which statement BEST describes the consequences and requirements of inactive status?

• A.The licensee may continue to perform limited brokerage services such as showing properties, provided no compensation is received
• B.The licensee must complete all required continuing education before reactivating but is not required to complete continuing education during the inactive period to maintain the inactive license
• C.The licensee must complete the same continuing education hours required for active renewal in order to keep the inactive license in good standing each renewal cycle
• D.The licensee automatically forfeits all accrued license history and must retake the state examination upon reactivation after any period of inactivity

Q10.A property sold for $350,000 and generates annual net operating income of $28,000. What is the capitalization rate?

• A.6.5%
• B.8.0%
• C.7.2%
• D.8.5%

Q11.A Washington real estate broker's first active license was issued on March 1. Under WAC 308-124-148 and Washington's continuing education framework, how many clock hours of approved continuing education must the broker complete to renew an active license at the FIRST renewal cycle, and what is the mandatory component that must be included?

• A.30 hours total, including the mandatory 3-hour Washington Real Estate Law course approved by the Director
• B.90 hours total at first renewal, which includes the 60-hour advanced practices course and 30 hours of electives
• C.27 hours total at subsequent renewals, but 90 hours at the first renewal due to the post-licensing education requirement, including a mandatory 3-hour core curriculum course
• D.30 hours total at every renewal, with no mandatory core curriculum requirement for first-time renewals

Q12.An applicant for a Washington real estate broker (salesperson) license has completed the required pre-license education. Under WAC 308-124B, which of the following correctly describes the sequence of steps the applicant must follow before being issued an active license?

• A.Submit the license application to the DOL, then complete the PSI examination, then affiliate with a firm
• B.Pass the PSI examination, submit a license application to the DOL, and affiliate with a designated broker
• C.Affiliate with a designated broker first, then take the PSI examination, then apply to the DOL
• D.Complete a background check with the Washington State Patrol, pass the PSI examination, then affiliate with a firm without filing an application

Q13.A broker is the designated broker of record for a newly formed real estate company. She supervises six affiliated salespersons. Under the broker's supervision duties, which of the following scenarios would most likely result in direct disciplinary action against the broker's own license—separate from any action against the salesperson—under general broker licensing principles?

• A.A salesperson, acting entirely outside the scope of the brokerage, uses her personal social media account to post a discriminatory rental advertisement without the broker's knowledge, using only her own name and no brokerage branding.
• B.A salesperson regularly deposits earnest money checks directly into the brokerage's operating account rather than the trust account, and the broker's office policy manual contains no written procedure addressing trust fund handling, allowing the practice to continue undetected for months.
• C.A salesperson makes a negligent misrepresentation to a buyer about a property's square footage based on a seller's representation, despite the broker having trained all staff on the duty to verify material facts.
• D.A salesperson fails to disclose a personal relationship with the seller on a transaction in a state where the broker had no prior knowledge of the relationship and the disclosure form was the salesperson's sole responsibility.

Q14.A buyer's earnest money deposit is held in the firm's trust account. The transaction falls through and both the buyer and seller submit conflicting written demands for the earnest money. Under WAC 308-124C, what is the designated broker's MOST appropriate course of action?

• A.Release the earnest money to the buyer because the buyer is the party who deposited the funds.
• B.Release the earnest money to the seller because the buyer defaulted on the purchase and sale agreement.
• C.Retain the funds in trust and file an interpleader action or follow the dispute resolution procedure, continuing to hold the funds until a written release or court order is received.
• D.Return the funds equally to both parties to avoid any legal liability for the firm.

Q15.Keisha's buyer discovers a large new water stain on the ceiling during the final walk-through two days before closing. What is the most appropriate next step?

• A.Proceed to closing — the contract is executed and the walk-through is not an inspection
• B.Cancel the contract immediately without contacting the listing agent
• C.Document the damage, contact the listing agent, and negotiate a repair, credit, or extension before closing
• D.Refuse to close and forfeit the earnest money