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Free New Jersey Real Estate Broker Examination Practice Questions

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Sample Practice Questions

Try these 10 sample questions from the New Jersey Real Estate Broker Examination practice bank. Each includes the answer and explanation. Continue with the interactive practice above to review the full question set.

  1. 1A seller installed bookcases with bolts into the living-room wall. The sales contract does not exclude them. How are the built-in bookcases classified?

    1. A. A fixture conveyed with the real estate unless expressly excluded
    2. B. A movable chattel retained by the seller unless expressly included
    3. C. A trade fixture that its installer may remove before conveyance
    4. D. Personal property transferred only through a separate bill of sale

    Answer: A

    Explanation: "Fixture-is a tangible thing, which was previously personal property, but which has been attached to the land or installed in a structure on the land in such a way as to become part of the real estate." Bolting the bookcases into the wall as built-ins makes them fixtures; the other classifications describe removable chattels or trade fixtures rather than this permanent attachment. The contract states no exclusion.

    Reference: New Jersey Handbook for Assessors — Glossary, Fixture, p. 110

  2. 2An appraiser has several recent sales of similar homes and must account for differences in condition and location. Which valuation procedure matches that evidence?

    1. A. Deduct depreciation from replacement cost and add land
    2. B. Capitalize the property's expected operating income
    3. C. Discount forecast cash flows and reversion at a yield rate
    4. D. Adjust the comparable sale prices for relevant differences

    Answer: D

    Explanation: "In the Sales Comparison Approach, a value indication is derived by comparing the property being appraised to similar properties that have been sold recently, applying appropriate units of comparison, and making adjustments to the sale prices of the comparables based on the elements of comparison." This situation calls for adjustments to comparable sales; the other procedures use cost or income evidence.

    Reference: IRS Publication 5464, Real Property Valuation Guidelines — §G.1(1), Sales Comparison Approach, p. 72

  3. 3A buyer chooses a fully amortizing mortgage with regular payments. What happens to the outstanding balance as those payments are made?

    1. A. It stays unchanged until the final payment is due
    2. B. It decreases as principal is repaid over time
    3. C. It increases because unpaid interest is added to it
    4. D. It becomes due entirely as a balloon at maturity

    Answer: B

    Explanation: "Amortization means paying off a loan with regular payments over time, so that the amount you owe decreases with each payment." Amortizing payments reduce the principal balance over time. An interest-only structure can leave principal unchanged, negative amortization can increase it, and a balloon structure may leave a large final balance.

    Reference: CFPB, Mortgages Key Terms — Amortization, Mortgage Key Terms

  4. 4An agent for a New Jersey seller realizes the agent has a financial interest in a company that may benefit from the pending transaction. What should the agent do about that foreseeable conflict?

    1. A. Disclose the potential conflict only after the sale closes
    2. B. Disclose the potential conflict promptly to the principal
    3. C. Disclose the potential conflict only to the other party
    4. D. Disclose the potential conflict only to the lender

    Answer: B

    Explanation: "To act as fiduciaries, bound by the duty of loyalty and must disclose any actual or potential conflicts of interest to their principal that the agent may reasonably anticipate in a timely manner." Loyalty requires timely disclosure of an actual or potential conflict the agent can reasonably anticipate. Waiting, or notifying only another participant, does not satisfy the principal-facing duty.

    Reference: NJ Real Estate Commission Bulletin 24-11 — Bulletin 24-11, Agency Relationships and Duties, p. 3

  5. 5When must an unrepresented NJ seller provide the statutory property condition disclosure to the buyer?

    1. A. Before the buyer becomes contractually obligated
    2. B. After deed recording
    3. C. After the buyer takes possession
    4. D. At the next tax assessment

    Answer: A

    Explanation: The seller must provide the PCDS "before the buyer becomes obligated under any contract."

    Reference: Njrec Bulletin 24 11 — P.L. 2024, c.32, s.2(e); Bulletin 24-11 page 6

  6. 6After a buyer closes, a person claims an ownership interest dating from before the purchase and sues the new homeowner. Which policy is designed to protect the homeowner against that title claim?

    1. A. The lender's mortgage title policy
    2. B. The homeowner's hazard insurance policy
    3. C. The borrower's private mortgage insurance
    4. D. The homeowner's owner's title insurance

    Answer: D

    Explanation: "Owner’s title insurance protects the homeowner if someone sues and says they have a claim against the home from before the homeowner purchased it." Owner's title insurance addresses a pre-purchase title claimant suing the homeowner. A lender's title policy protects the lender; hazard insurance and PMI address different risks.

    Reference: CFPB, What Is Owner's Title Insurance? — What Is Owner's Title Insurance?, answer

  7. 7A rental advertisement excludes households with children. Which federally protected characteristic is implicated by that preference?

    1. A. Familial status
    2. B. National origin
    3. C. Religious belief
    4. D. Disability status

    Answer: A

    Explanation: "The Fair Housing Act prohibits discrimination in housing because of: Race Color National Origin Religion Sex Familial Status Disability" Excluding households with children implicates familial status under the federal Fair Housing Act. The other options are protected bases too, but they are not the characteristic targeted in this scenario.

    Reference: HUD, Fair Housing Act Overview — Fair Housing Act Overview, Who Is Protected?

  8. 8During a Commission investigation, which records must an NJ licensee make available for inspection?

    1. A. Only closed-sale contracts
    2. B. Only escrow bank statements
    3. C. Pertinent transaction and business records
    4. D. Only advertising invoices

    Answer: C

    Explanation: N.J.A.C. 11:5-5.5(a) covers records and documents that "may be pertinent to an investigation."

    Reference: Njrec Rules Adoption (2026) — N.J.A.C. 11:5-5.5(a)

  9. 9For another and for expected compensation, which activity falls within NJ's statutory definition of real estate broker?

    1. A. Negotiating a real-estate sale
    2. B. Drafting a personal will
    3. C. Repairing a private residence
    4. D. Inspecting a municipal road

    Answer: A

    Explanation: R.S.45:15-3 includes one who "offers or attempts to negotiate a sale" of real estate for consideration.

    Reference: P.L. 2018, c.071 (S430 1R) — Section 2, R.S.45:15-3

  10. 10Which NJ agency unit enforces the Real Estate Sales Full Disclosure Act's registration and anti-fraud provisions?

    1. A. Bureau of Subdivided Land Sales Control
    2. B. Division of Taxation
    3. C. Pinelands Commission
    4. D. Local construction office

    Answer: A

    Explanation: The NJREC page says the Bureau "was created by statute to enforce the registration and anti-fraud provisions" of the Act.

    Reference: NJDOBI | NJ Real Estate Commission - Bureau of Subdivided Land Sales Control — N.J.S.A. 45:15-16.27 et seq.; Bureau of Subdivided Land Sales Control overview

Topics in this practice bank

These topics describe the available practice for New Jersey Real Estate Broker Examination. Review the examination outline and its sources for scope and allocation details.

  • Property Ownership (Broker 10%)
    • A. Real and personal property; conveyances
    • B. Land characteristics and legal descriptions
    • 1. Metes and bounds method of legal property description
    • 2. Lot and block (recorded plat) method of legal property description
    • 3. Government survey (rectangular survey) method of legal property description
    • 4. Measuring structures (linear and square footage)
    • 5. Land measurement
    • C. Encumbrances and effects on property ownership
    • 1. Types of liens and their effect on the title and value of real property
    • 2. Easements, rights of way and licenses, including their effect on the title, value and use of real property
    • 3. Encroachments and their effect on the title, value and use of real property
    • 4. Potential encumbrances on title, such as probate, leases, or adverse possession
    • 5. Property rights that may be conveyed separately from use of the land surface, such as mineral and other subsurface rights, air rights, or water rights
    • D. Types of ownership
    • 1. Ownership in severalty/sole ownership
    • 2. Implications of ownership as tenants in common
    • 3. Implications of ownership in joint tenancy
    • 4. Forms of common-interest ownership, such as Timeshares, Condominiums and Co-ops
    • 5. Property ownership held in a trust or by an estate
    • 6. Ownership by business entities
    • 7. Life Estate ownership
  • Land use Controls (Broker 5%)
    • A. Government rights in land
    • 1. Government rights to impose property taxes and special assessments
    • 2. Government rights to acquire land through eminent domain, condemnation and escheat
    • B. Government controls on land use
    • C. Private controls
    • 1. Deed conditions or restrictions on property use
    • 2. Subdivision covenants, conditions and restrictions (CC&Rs) on property use
    • 3. Condominium and owners’ associations regulations or bylaws on property use
  • Valuation (Broker 8%)
    • A. Appraisals
    • 1. Appraisals for valuation of real property
    • 2. Situations which require appraisal by a licensed or certified appraiser and brokerage-related actions that constitute unauthorized appraisal practice
    • 3. General steps in appraisal process
    • B. Estimating Value
    • 1. Economic principles and property characteristics that affect value of real property
    • 2. Sales or market comparison approach to property valuation and appropriate uses
    • 3. Cost approach to property valuation and appropriate uses
    • 4. Income analysis approach to property valuation and appropriate uses
    • C. Comparative Market Analysis (CMA)
    • 1. Competitive/Comparative Market Analysis (CMA), BPO or equivalent
    • 2. Automated Valuation Method (AVM), appraisal valuation and Comparative Market Analysis (CMA)
  • Financing (Broker 9%)
    • A. Basic Concepts and Terminology
    • 1. Loan financing (for example, points, LTV, PMI, interest, PITI)
    • 2. General underwriting process (e.g., debt ratios, credit scoring and history)
    • 3. Standard mortgage/deed of trust clauses and conditions
    • 4. Essential elements of a promissory note
    • B. Types of Loans
    • 1. Conventional loans
    • 2. Amortized loans, partially amortized (balloon) loans, interest-only loans
    • 3. Adjustable-rate mortgage (ARM) loans
    • 4. Government Loans
    • a. FHA insured loans
    • b. VA guaranteed loans
    • c. USDA/Rural Development loan programs
    • 5. Owner financing (for example, installment or land contract/contract for deed)
    • 6. Reverse-mortgage loans
    • 7. Home equity loans and lines of credit
    • 8. Construction loans
    • 9. Rehab loans
    • 10. Bridge loans
    • C. Financing and Lending
    • 1. Real Estate Settlement Procedures Act (RESPA), including kickbacks
    • 2. Truth-in-Lending Act (Regulation Z), including advertising
    • 3. Requirements and time frames of TRID (TILA-RESPA Integrated Disclosures)
    • 4. Equal Credit Opportunity Act
    • 5. Lending Process (application through loan closing)
    • 6. Risky loan features, such as prepayment penalties and balloon payments
  • Contracts (Broker 19%)
    • A. General Contract Law
    • 1. General principles of contract law
    • 2. Elements necessary for a contract to be valid
    • 3. Effect of the Statute of Frauds
    • 4. Offer and a contract
    • 5. Enforceability of contracts
    • 6. Void, voidable and unenforceable contracts
    • 7. Bilateral and unilateral contracts
    • 8. Nature and use of option agreements
    • 9. Notice, delivery, acceptance and execution of contracts
    • 10. Appropriate use, risks, and advantages of electronic signatures and paperless transactions
    • 11. Rights and obligations of the parties to a contract
    • 12. Possible remedies for breach or non-performance of contract
    • 13. Termination, rescission and cancellation of contracts
    • B. Purchase and Lease Contracts
    • 1. Addenda and amendments to contracts
    • 2. Purchase agreements
    • 3. Contract contingencies and methods for satisfying them
    • 4. Leases and rental agreements
    • 5. Lease-purchase agreements
    • 6. Types of leases
    • C. Proper handling of multiple offers and counteroffers
  • Agency (Broker 13%)
    • A. Agency and non-agency relationships
    • 1. Agency relationships and how they are established
    • 2. Types of listing contracts
    • 3. Buyer brokerage/tenant representation contracts
    • 4. Other brokerage relationships, including transaction brokers and facilitators
    • 5. Powers of attorney and other assignments of authority
    • 6. Conditions for termination of agency or brokerage service agreements
    • B. Agent Duties
    • 1. Fiduciary duties of agents
    • 2. Agent's duties to customers/non-clients, including honesty and good faith
    • C. Agency Disclosures
    • 1. Disclosure of agency/representation
    • 2. Disclosure of possible conflict of interest or self- interest
  • Property Disclosures (Broker 7%)
    • A. Property Condition
    • 1. Seller's property condition disclosure requirements
    • 2. Property conditions that may warrant inspections or a survey
    • 3. Red flags that warrant investigation of public or private land use controls
    • B. Environmental and Government Disclosures
    • 1. Environmental issues requiring disclosure
    • 2. Federal, state, or local disclosure requirements regarding the property
    • C. Disclosure of material facts and material defects
  • Property Management (Broker 5%)
    • A. Duties and Responsibilities
    • 1. Procurement and qualification of prospective tenants
    • 2. Fair housing and ADA compliance specific to property management
    • 3. How to complete a market analysis to identify factors in setting rents or lease rates
    • 4. Property manager responsibility for maintenance, improvements, reporting and risk management (BROKER ONLY)
    • 5. Handling landlord and tenant funds; trust accounts, reports and disbursements (BROKER ONLY)
    • 6. Provisions of property management contracts (BROKER ONLY)
    • B. Landlord and tenant rights and obligations
  • Transfer of Title (Broker 6%)
    • A. Types of deeds
    • B. Title Insurance and Searches
    • 1. Title insurance policies and title searches
    • 2. Potential title problems and resolutions
    • 3. Marketable and insurable title
    • C. Closing Process
    • 1. When transfer of ownership becomes effective
    • 2. Process and importance of recordation
    • 3. Settlement procedures (closing) and parties involved
    • 4. Home and new construction warranties
    • D. Special Processes
    • 1. Special issues in transferring foreclosed properties
    • 2. Special issues in short sale transactions
    • 3. Special issues in probate transactions
  • Practice of Real Estate (Broker 12%)
    • A. Antidiscrimination
    • 1. Federal Fair Housing Act general principles and exemptions
    • 2. Protected classes under Federal Fair Housing Act
    • 3. Protections against discrimination based on gender identity and sexual orientation
    • 4. Prohibited conduct under Federal Fair Housing Act (Redlining, Blockbusting, Steering, Disparate Treatment)
    • 5. Fair housing advertising rules
    • 6. Americans with Disabilities Act (ADA) obligations pertaining to accessibility and reasonable accommodations
    • B. Legislation and Regulations
    • 1. Licensees’ status as employees or independent contractors
    • 2. Antitrust laws and types of violations, fines and penalties
    • 3. Do-Not-Call List rule compliance
    • 4. Proper use of Social Media and Internet communication and advertising
    • C. Duties and Responsibilities
    • 1. Protection of confidential personal information (written, verbal or electronic)
    • 2. Duties when handling funds of others in transactions
    • 3. Licensee responsibility for due diligence in real estate transactions
    • D. Supervisory Responsibilities (BROKER ONLY)
    • 1. Broker's supervisory responsibilities (licensees, teams and unlicensed assistants and employees) (BROKER ONLY)
    • 2. Broker relationship with licensees (employees or independent contractors and governing rules) (BROKER ONLY)
  • Real Estate Calculations (Broker 6%)
    • A. Calculations for Transactions
    • 1. Seller’s net proceeds
    • 2. Buyer funds needed at closing
    • 3. Real property tax and other prorations
    • 4. Real property transfer fees
    • 5. PITI (Principal, Interest, Taxes and Insurance) payments estimate given loan rate and term
    • B. General Concepts
    • 1. Equity
    • 2. Rate of return/Capitalization rate
    • 3. Loan-to-Value ratio
    • 4. Discount points and loan origination fees
  • Duties and Powers of the Real Estate Commission (Broker 3 items)
    • 1. Maintenance of Records
    • 2. Sanctions
    • 2. Sanctions — a. Fines
    • 2. Sanctions — b. License Suspension and Revocation
  • Licensing Requirements (Broker 4 items)
    • 1. Activities Requiring a License
    • 2. Types of Licenses
  • Statutes and Rules Governing Licensee Activities (Broker 30 items)
    • 1. Advertising
    • 2. Broker/Salesperson Relationships
    • 3. Commissions and Required Accounting
    • 4. Agency/Conflicts of Interest/Disclosure Requirements
    • 5. Contracts and Other Documents
    • 6. Trust Fund Requirements
    • 7. Listings and Content of Listing Agreements
    • 8. Place of Business
    • 9. Records, including Escrow Account Bookkeeping Requirements
    • 10. Inducements
    • 11. Offering Buyer Rebates
    • 12. Responsibility to Public and Other Licensees
    • 13. Other Laws and Regulations
    • 13. Other Laws and Regulations — a. Farmland Reassessment Act
    • 13. Other Laws and Regulations — b. Pinelands Protection Act of 1979
    • 13. Other Laws and Regulations — c. Realty Transfer Fee
    • 13. Other Laws and Regulations — d. Mount Laurel Requirements
    • 13. Other Laws and Regulations — e. Zoning and building codes
    • 13. Other Laws and Regulations — f. Municipal Land Use Law
    • 13. Other Laws and Regulations — g. Real estate transfer tax
    • 13. Other Laws and Regulations — h. Truth in Renting Act
    • 13. Other Laws and Regulations — i. Freshwater Wetlands Protection Act of 1987
  • Additional Requirements (Broker 3 items)
    • 1. New Jersey Real Estate Sales Full Disclosure Act
    • 2. New Jersey Law Against Discrimination
    • 3. Real Estate Guaranty Fund
    • 4. New Jersey Real Estate Time Share Act

How to use these free practice questions

Choose an answer, check the explanation, and review your progress by chapter. Practice questions and explanations are free to access without signing up.

These are independent study questions, not actual examination items. For examination requirements and official information, view New Jersey Real Estate Broker Examination details.