Free Illinois Real Estate Practice Test (2026) — LicenseIQ

Question 1

A loan whose payments are not large enough to pay it off by the end of the term, leaving a large final payment, is a:

Accepted Answer

Partially amortized loans require a balloon payment at maturity. Negative amortization means the balance actually increases because payments don't cover interest.

Question 2

Zoning allows commercial vehicles to be parked in driveways, but the subdivision's restrictive covenants prohibit it. Which rule applies?

Accepted Answer

When public and private restrictions overlap, the more restrictive one must be followed.

Question 3

A title search is performed primarily to:

Accepted Answer

A title search establishes the chain of title and reveals encumbrances or defects before closing. (Reclassified from section 17 to section 9 / CORE - not NJ-specific.)

Question 4

The document issued by a VA-approved appraiser for a VA loan is the:

Accepted Answer

The VA appraiser issues a CRV. The Certificate of Eligibility establishes the veteran's entitlement before applying.

Question 5

The Illinois state real estate transfer tax rate is:

Accepted Answer

35 ILCS 200/31-10 imposes the state tax at 50 cents for each $500 of value or fraction of $500. Counties may add 25 cents per $500.

Question 6

In Illinois, tenancy by the entirety is available for:

Accepted Answer

Illinois limits tenancy by the entirety to homestead property held by spouses (and civil union partners). Other property must be held in joint tenancy or tenancy in common.

Question 7

A borrower facing default voluntarily conveys the property to the lender in exchange for release of the debt. This is a:

Accepted Answer

In a deed in lieu, the borrower voluntarily deeds the property to the lender, which avoids the foreclosure process; the lender must agree, and the borrower should get a written release of any remaining debt. In a short sale, the property is sold to a third party for less than owed with lender approval. Credit-reporting effects vary by lender and situation, so licensees should not promise a borrower any particular credit outcome.

Question 8

The most common form of homeowner's insurance policy for a single-family home is the:

Accepted Answer

HO-3 (special form) is the most common homeowner's policy. HO-4 is renter's insurance and HO-6 is for condominium owners.

Question 9

Which loan is insured by the federal government and allows a low down payment?

Accepted Answer

FHA loans are insured by the Federal Housing Administration and permit down payments as low as 3.5%. Conventional loans are not government-backed.

Question 10

Under Article 15, a consumer who sues a licensee for breach of statutory agency duties may recover:

Accepted Answer

Section 15-70 limits recovery to actual damages and court costs, or injunctive relief, and requires suit within 2 years of knowledge and 5 years of the act.

Question 11

A rectangular lot is 100 ft by 150 ft. How many square feet is it?

Accepted Answer

Area = length x width = 100 x 150 = 15,000 square feet. (250 is the sum of two sides.)

Question 12

Two brokers at the same sponsoring brokerage are each designated to represent the buyer and the seller in the same transaction. This is:

Accepted Answer

In designated agency, the sponsoring broker names specific licensees to represent each client to the exclusion of other licensees in the firm. Two different licensees each representing one party is not dual agency; dual agency requires the same licensee to represent both parties.

Question 13

For Section 22.1 resale disclosures, the association may charge the seller a base fee capped at:

Accepted Answer

Section 22.1 caps the fee at $375 (CPI-adjusted) for actual costs and permits an additional $100 for delivery within 72 hours.

Question 14

Radon is:

Accepted Answer

Radon is a colorless, odorless, naturally occurring radioactive gas that can enter homes through the foundation; it is the second leading cause of lung cancer.

Question 15

Under the Housing for Older Persons Act, a '55 and older' community generally requires that:

Accepted Answer

55+ housing requires at least 80% of occupied units to have one resident 55+; 62+ housing requires all residents to be 62+. The exemption applies only to familial status.

Question 16

Which is a requirement for an Illinois managing broker license?

Accepted Answer

Section 5-28 requires the applicant to be at least 20, to have been licensed as a broker for at least 2 consecutive years of the preceding 3, to complete 165 total hours of education, and to pass the exam. There is no transaction-count requirement.

Question 17

A borrower paid $3,150 in points on a $210,000 loan. How many points were paid?

Accepted Answer

Points = cost / loan = $3,150 / $210,000 = 0.015 = 1.5 points (1 point = 1% of the loan).

Question 18

A timeshare that lets the owner use the property during a specific, set week each year is a:

Accepted Answer

Fixed-week timeshares assign the same week every year; floating weeks allow different weeks subject to availability.

Question 19

A buyer purchases a $300,000 home with an 80% loan, pays 1 point on the loan, a $450 appraisal and $1,800 in title charges, and has already deposited $10,000 earnest money. How much must the buyer bring to closing?

Accepted Answer

Down payment = $60,000; 1 point = $240,000 x 0.01 = $2,400; total = $60,000 + $2,400 + $450 + $1,800 = $64,650; minus $10,000 earnest money = $54,650.

Question 20

A landlord tells his leasing broker to reject any applicant who was ever arrested, even if not convicted. The broker should:

Accepted Answer

Section 3-102 prohibits real estate discrimination based on arrest record, defined to include arrests not leading to conviction, juvenile records and sealed or expunged records.

Question 21

Two brokers agree not to cooperate with a discount brokerage in order to drive it out of business. This is:

Accepted Answer

Agreeing with competitors to refuse to deal with another business is an illegal group boycott.

Question 22

The EPA action level for indoor radon at which mitigation is recommended is:

Accepted Answer

The EPA recommends mitigation at 4 pCi/L or higher. Radon is the second leading cause of lung cancer.

Question 23

A townhome subdivision governed by a homeowners association that is not a condominium is generally governed by:

Accepted Answer

The Common Interest Community Association Act (765 ILCS 160) governs common interest communities other than condominiums and cooperatives.

Question 24

To terminate a month-to-month residential tenancy in Illinois, the landlord must give:

Accepted Answer

735 ILCS 5/9-207 requires 30 days' written notice to terminate a month-to-month tenancy. Seven days applies to week-to-week tenancies.

Question 25

Which duties continue after an Illinois brokerage relationship terminates?

Accepted Answer

Section 15-30 ends the licensee's duties at termination except the duty to account for money and property and the duty to keep confidential information confidential.

Illinois real estate practice test

1. A loan whose payments are not large enough to pay it off by the end of the term, leaving a large final payment, is a:

2. Zoning allows commercial vehicles to be parked in driveways, but the subdivision's restrictive covenants prohibit it. Which rule applies?

3. A title search is performed primarily to:

4. The document issued by a VA-approved appraiser for a VA loan is the:

5. The Illinois state real estate transfer tax rate is:

6. In Illinois, tenancy by the entirety is available for:

7. A borrower facing default voluntarily conveys the property to the lender in exchange for release of the debt. This is a:

8. The most common form of homeowner's insurance policy for a single-family home is the:

9. Which loan is insured by the federal government and allows a low down payment?

10. Under Article 15, a consumer who sues a licensee for breach of statutory agency duties may recover:

11. A rectangular lot is 100 ft by 150 ft. How many square feet is it?

12. Two brokers at the same sponsoring brokerage are each designated to represent the buyer and the seller in the same transaction. This is:

13. For Section 22.1 resale disclosures, the association may charge the seller a base fee capped at:

14. Radon is:

15. Under the Housing for Older Persons Act, a '55 and older' community generally requires that:

16. Which is a requirement for an Illinois managing broker license?

17. A borrower paid $3,150 in points on a $210,000 loan. How many points were paid?

18. A timeshare that lets the owner use the property during a specific, set week each year is a:

19. A buyer purchases a $300,000 home with an 80% loan, pays 1 point on the loan, a $450 appraisal and $1,800 in title charges, and has already deposited $10,000 earnest money. How much must the buyer bring to closing?

20. A landlord tells his leasing broker to reject any applicant who was ever arrested, even if not convicted. The broker should:

21. Two brokers agree not to cooperate with a discount brokerage in order to drive it out of business. This is:

22. The EPA action level for indoor radon at which mitigation is recommended is:

23. A townhome subdivision governed by a homeowners association that is not a condominium is generally governed by:

24. To terminate a month-to-month residential tenancy in Illinois, the landlord must give:

25. Which duties continue after an Illinois brokerage relationship terminates?

Sources