Free MSREB Practice Questions

Question 1

A bakery tenant bolts stainless-steel display racks to the floor solely for its retail operation. The lease is silent. Two days before the lease expires, the tenant removes the racks and professionally repairs the anchor holes. How should the racks be classified?

Accepted Answer

Trade fixtures the tenant may remove before the lease ends if removal damage is repaired

Answer

Fixtures that became the landlord's property when they were bolted to the slab

Answer

Personal property only if the lease expressly reserves every installed item to the tenant

Answer

Improvements the tenant may leave in place and charge against the final month's rent

Question 2

Local zoning permits rear-yard fences up to eight feet. Recorded subdivision covenants cap them at six feet, and neither restriction is invalid. Without obtaining a covenant amendment, what is the highest fence the buyer may build?

Accepted Answer

Six feet; both controls apply, so the stricter covenant limits construction

Answer

Eight feet; zoning supersedes a private covenant whenever both regulate the same feature

Answer

Eight feet after obtaining a municipal variance from the covenant's six-foot limit

Answer

No fence; conflicting public and private restrictions make the lot nonconforming

Question 3

An investor is estimating value by direct capitalization. Annual potential gross income is $240,000; vacancy and collection loss is 5%; ordinary operating expenses are $78,000; annual mortgage debt service is $48,000; and a one-time roof replacement is a $30,000 capital expenditure. Comparable sales support a 7.5% capitalization rate. What value indication results?

Accepted Answer

$2,000,000, using NOI before debt service and capital expenditures

Answer

$960,000, after subtracting both debt service and the roof expenditure from NOI

Answer

$1,360,000, after subtracting annual debt service from NOI

Answer

$1,600,000, after treating the roof replacement as an operating expense

Question 4

A borrower receives the Closing Disclosure on Monday for a Friday consummation. On Tuesday, the disclosed homeowner's insurance premium changes. The annual percentage rate remains accurate, the loan product is unchanged, and no prepayment penalty is added. How does the change affect Friday's consummation?

Accepted Answer

A corrected Closing Disclosure is required, but Friday may proceed because no waiting-period trigger occurred

Answer

Consummation must be postponed for a new three-business-day period because any corrected amount restarts the clock

Answer

No correction is required because a borrower-selected insurance premium is outside the creditor's control

Answer

The borrower must use the originally quoted insurer so the existing Closing Disclosure remains unchanged

Question 5

A purchase contract gives the buyer until June 10 to obtain financing and states: 'Buyer may terminate by written notice delivered by that date; failure to give timely notice waives this contingency.' No notice is sent, and on June 11 the buyer still lacks a loan commitment. Under the quoted clause, which result follows?

Accepted Answer

The contract continues, but the buyer waived that contingency by missing the written-notice deadline

Answer

The contract automatically terminated at midnight, regardless of the notice language, when the commitment was not issued

Answer

The seller must extend the financing deadline for a commercially reasonable period before enforcing the agreement

Answer

The buyer may cancel orally at any time before closing because financing is a material contract term

Question 6

A listing agent learns that $410,000 is the seller's confidential minimum, then decides to submit a $410,000 offer through an LLC the agent wholly owns. Before the seller considers the offer, what is the agent's most defensible course?

Accepted Answer

Disclose the agent's license and LLC ownership, explain the conflict, and obtain informed consent

Answer

Present the offer through another brokerage because an LLC is legally separate from its owner

Answer

Have another licensee deliver the offer while keeping the agent's ownership of the LLC confidential

Answer

Abandon any purchase permanently because a licensee may never acquire property listed for a client

Question 7

The parties are preparing a purchase contract for a 1965 single-family home. The seller has no lead reports, the buyer wants a six-day closing, and the buyer does not want a lead inspection. Which arrangement complies with the federal lead-based-paint disclosure rule?

Accepted Answer

The seller provides known information, available records, the pamphlet, and warning language; the buyer gives a written inspection waiver

Answer

The seller hires a certified risk assessor and completes any recommended abatement before the parties sign the contract

Answer

The broker records the buyer's oral waiver after explaining that the normal inspection opportunity is 10 days

Answer

The parties omit the lead documents because the rule applies only when a child under six will occupy the home

Question 8

At 11:30 p.m., a tenant reports water pouring from a ruptured line onto an energized electrical panel. The management agreement authorizes emergency action to protect life and property, although the expected repair exceeds the manager's ordinary spending limit. What should the manager do first?

Accepted Answer

Keep occupants clear and summon qualified emergency help immediately under the agreement

Answer

Wait for the owner's written approval because the repair exceeds the ordinary spending limit

Answer

Ask the tenant to shut off the main breaker and mop the water before help arrives

Answer

Schedule the first available plumber and document why the repair was delayed

Question 9

A state follows a race-notice recording statute. Grantor conveys the same parcel to Avery on January 2 and to Blake on January 10. Blake pays value and has no notice of Avery's deed. Avery records on January 11; Blake records on January 12. Who has priority?

Accepted Answer

Avery, because Blake did not record before the earlier grantee

Answer

Blake, because a later purchaser who pays value always defeats an earlier unrecorded deed

Answer

Blake, because delivery of the later deed extinguished Avery's interest before Avery recorded

Answer

The grantor, because neither conveyance became effective until its deed was recorded

Question 10

An owner occupies one unit of a four-unit building and asks the listing broker to advertise another unit as 'quiet adults only - no children.' How should the broker respond?

Accepted Answer

Refuse the wording and advertise objective features without a familial-status preference

Answer

Run the advertisement because the owner-occupied small-building exemption permits the wording

Answer

Let the owner place the same advertisement personally so the brokerage is not responsible for it

Answer

Terminate the listing and report the owner to HUD before discussing any compliant alternative

Free MSREB Practice Questions

Domain 1: Property Ownership 10% of exam

Question 1

Domain 2: Land Use Controls 5% of exam

Question 2

Domain 3: Valuation 8% of exam

Question 3

Domain 4: Financing 9% of exam

Question 4

Domain 5: Contracts 19% of exam

Question 5

Domain 6: Agency 13% of exam

Question 6

Domain 7: Property Disclosures 7% of exam

Question 7

Domain 8: Property Management 5% of exam

Question 8

Domain 9: Transfer of Title 6% of exam

Question 9

Domain 10: Practice of Real Estate 12% of exam

Question 10

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