Free Wisconsin Real Estate Practice Exam

Q1.During a listing presentation, a broker notices that a neighborhood's population has shifted significantly toward a particular ethnic group over the past five years. A prospective seller asks the broker to mention this demographic shift in marketing materials to attract buyers from that same group. Accepting this instruction would most directly violate which ethical and legal principle?

• A.The Fair Housing Act's prohibition on steering, because targeting marketing to buyers of a specific race or national origin discourages other protected-class members from considering the property.
• B.RESPA Section 9, because directing buyers toward specific communities constitutes a required use of settlement services.
• C.ECOA, because demographic marketing references constitute an inquiry into a loan applicant's national origin during underwriting.
• D.Truth-in-Lending, because advertising demographic characteristics of a neighborhood triggers additional APR disclosure requirements.

Q2.A multi-board listing contract allows cooperation with other MLS systems. If a buyer's agent from a different MLS brings a successful offer, how is the commission typically handled?

• A.The listing broker keeps the full commission since it's their listing
• B.The commission is split equally between all participating MLS systems
• C.The buyer must pay their agent's commission separately
• D.The listing broker shares the commission with the cooperating broker per the MLS agreement

Q3.During the listing period, a broker's affiliated salesperson procures a buyer who submits an offer on the listed property. The broker wishes to practice designated agency by assigning the listing salesperson to represent the seller and the buyer's salesperson to represent the buyer exclusively. Under advanced agency principles applicable nationally, which condition is MOST critical for this arrangement to be legally and ethically valid?

• A.Both the seller and the buyer must provide prior informed written consent to the designated agency arrangement, typically disclosed and agreed to before or at the time the agency relationships are established.
• B.The broker must obtain written consent only from the seller, since the buyer is a customer and not entitled to agency representation in a designated agency model.
• C.Designated agency is automatically created when two salespersons from the same brokerage work opposite sides of a transaction, requiring no additional disclosure or consent.
• D.The broker must withdraw from the transaction entirely and refer both parties to outside agents to avoid any dual-agency conflict under RESPA.

Q4.Which loan type requires the property to meet HUD Minimum Property Standards, potentially requiring seller repairs before the loan can close?

• A.FHA loans
• B.Conventional conforming loans
• C.VA loans only
• D.USDA Rural Development loans only

Q5.A Wisconsin property manager collects security deposits and monthly rent on behalf of an owner. Under Wisconsin law, where must these funds be held?

• A.In the property manager's personal checking account to facilitate quick disbursement.
• B.In the owner's personal savings account as directed by the owner.
• C.In a trust account, separate from the property manager's operating or personal funds.
• D.In a money market account held jointly in the names of the manager and the owner.

Q6.Under Wisconsin law, which of the following is a duty a firm owes EXCLUSIVELY to its CLIENT but does NOT owe to a customer under Wis. Stat. § 452.133?

• A.Disclosing material adverse facts affecting the property
• B.Providing fair and honest treatment in all dealings
• C.Keeping the client's financial motivation confidential from other parties
• D.Informing the customer of all known material adverse facts

Q7.Which of the following qualifies as valid consideration in an Arizona real estate purchase contract?

• A.The buyer's promise to pay the purchase price in exchange for the seller's promise to convey title
• B.The buyer's promise to love and care for the property
• C.The parties' long-standing friendship and mutual trust
• D.The listing agent's promise to work hard on the transaction

Q8.A Wisconsin buyer asks their salesperson whether a home they are considering had a prior owner who was convicted of a violent crime on the premises. Under Wisconsin's stigmatized-property law, how should the salesperson respond?

• A.The salesperson must proactively disclose all violent crimes that occurred on the property
• B.The salesperson is not required to disclose that a violent crime occurred on the property, and such a fact is not a material fact under Wisconsin law
• C.The salesperson must disclose the crime only if it happened within the past two years
• D.The salesperson must refer the buyer to the county sheriff's department and then disclose what the sheriff confirms

Q9.Under Wisconsin law, when a firm is providing brokerage services to a client, which of the following BEST describes the firm's duty regarding information the client shares in confidence?

• A.The firm may share the client's confidential information with any cooperating broker as long as the cooperating broker is also a Wisconsin licensee
• B.The firm must keep the client's confidential information private even after the transaction closes, unless the client provides written permission to disclose
• C.The firm's duty of confidentiality ends automatically once the listing agreement or buyer agency agreement expires
• D.The firm may disclose confidential client information to the other party if doing so would help facilitate a faster closing

Q10.A Wisconsin broker's office policy manual states that all affiliated licensees must charge a minimum buyer-broker compensation of 2.5% on any buyer representation agreement, and agents are prohibited from negotiating this rate downward without the managing broker's written approval. A buyer's agent challenges the policy, arguing it may violate antitrust law. Separately, a competitor brokerage has adopted an identical 2.5% minimum policy. Under Sherman Act analysis, how do these two scenarios differ in their antitrust exposure?

• A.The internal office minimum-fee policy is a vertical restraint within a single enterprise and, under Leegin Creative Leather Products v. PSKS (2007), is analyzed under the rule of reason and may be lawful if pro-competitive; the identical policy adopted independently by the competing firm raises no additional concern unless evidence shows the two firms coordinated the rate, which would constitute per se illegal horizontal price-fixing.
• B.Both policies are per se illegal under the Sherman Act because any minimum fee requirement in a buyer representation agreement constitutes price-fixing regardless of whether the arrangement is vertical or horizontal.
• C.Neither policy raises antitrust concerns because Wisconsin's buyer agency statute, Wis. Stat. § 452.135, expressly permits brokers to set minimum compensation thresholds in their brokerage service agreements.
• D.The competitor's independent adoption of the same rate is conclusive proof of illegal price-fixing under the conscious parallelism doctrine and automatically creates Sherman Act liability for both brokers.

Q11.A Wisconsin homeowner discovers that a deed covenant recorded in 1965 restricts all lots in the subdivision to single-family residential use only. A neighbor is now operating a small daycare business from their home, which the homeowner believes violates the covenant. Who has the legal authority to enforce this deed restriction in Wisconsin?

• A.The Wisconsin DNR, because it regulates all land-use matters in the state
• B.The local municipality's zoning department, which can issue a citation for the covenant violation
• C.Any property owner within the subdivision who benefits from the restriction, through a private civil court action
• D.The Wisconsin Real Estate Examining Board (REEB), which can suspend the neighbor's right to sell the property

Q12.RESPA (Real Estate Settlement Procedures Act) primarily regulates which aspect of real estate transactions?

• A.Closing costs and settlement procedures
• B.Property inspections
• C.Real estate licensing requirements
• D.Property tax assessments

Q13.During a Wisconsin broker's office meeting, a sales manager suggests that all agents should refuse to cooperate with — or show listings of — a new discount brokerage that recently entered the market and charges a 1% listing commission. The sales manager argues this is a legitimate business decision to protect the office's professional standards. Under federal antitrust law, which analysis most accurately applies to this proposed conduct as it relates to the Wisconsin broker's liability?

• A.A unilateral refusal to deal by a single brokerage is generally lawful under the Colgate doctrine, but if the broker coordinates this refusal with other competing brokerages, it becomes a per se illegal group boycott under Section 1 of the Sherman Act, exposing the broker to treble damages under 15 U.S.C. § 15.
• B.Because MLS participation rules in Wisconsin are governed by NAR policy and not state statute, a refusal to cooperate with any MLS participant is a purely contractual matter exempt from antitrust scrutiny.
• C.A group boycott of a discount brokerage is analyzed under the rule of reason rather than the per se standard, so the broker need only show a pro-competitive justification to avoid liability.
• D.Under Wis. Stat. § 452.137, brokers have an absolute right to select their cooperative partners, and federal antitrust law yields to this state statute under the Parker v. Brown state-action exemption.

Q14.A property manager advertises a rental unit stating "Perfect for young professionals, no children or elderly tenants." This advertisement violates the Fair Housing Act because it discriminates based on:

• A.Age only
• B.Familial status only
• C.Neither age nor familial status, as these are business preferences
• D.Both age and familial status

Q15.When documenting witnessed harassment, which record is most useful in an enforcement action?

• A.A summary written weeks later with your legal conclusions included
• B.A detailed emotional account describing your personal reaction
• C.A general note stating that 'a potential fair housing violation occurred'
• D.A factual, specific record created the same day (contemporaneous) using exact words and observable conduct