Free Pennsylvania Contracts Practice Test — LicenseIQ

Question 1

A contract that has all legal elements but where one party may cancel is:

Accepted Answer

A voidable contract is valid but one party may rescind it (e.g., a minor, or a party induced by misrepresentation or duress). A void contract lacks an essential element and has no legal effect.

Question 2

A licensee representing the seller who learns the buyer will pay more than the offer must:

Accepted Answer

Loyalty and disclosure require the seller's agent to share material information that benefits the client. The agent owes the buyer-customer no confidentiality.

Question 3

A seller has already accepted an offer, and another buyer submits a higher offer. The listing agent should:

Accepted Answer

Listing agents must present all offers through closing, but should not give legal advice about the seller's obligations under the existing contract.

Question 4

Adding a new financing contingency to an existing sales contract is done by a(n) ____, while changing the existing closing date is done by a(n) ____.

Accepted Answer

An addendum ADDs new terms; an amendment changes existing terms. Both require agreement of both parties.

Question 5

A contract clause stating that 'time is of the essence' means:

Accepted Answer

'Time is of the essence' makes performance by the stated dates essential; missing a deadline can be a breach.

Question 6

With proper written permission, a broker held a deposit check with an offer. The seller accepted the offer on Tuesday. The check must be deposited by:

Accepted Answer

Once the seller accepts, §35.324(b) requires deposit within 1 business day of the acceptance.

Question 7

An offer or counteroffer becomes a binding contract when:

Accepted Answer

Acceptance must be unconditional and communicated back to the offeror; any change creates a counteroffer instead.

Question 8

A buyer offers $300,000. The seller counters at $315,000. The buyer rejects the counter and then tries to accept the original $300,000 offer terms. Is there a contract?

Accepted Answer

A counteroffer is a rejection and a new offer; the original offer cannot be revived by the buyer.

Question 9

Under a land contract (contract for deed), during the payment period the buyer holds:

Accepted Answer

In an installment/land contract the buyer has equitable title and possession; the seller keeps legal title until the final payment.

Question 10

Under the statute of frauds, a real estate sales contract must be:

Accepted Answer

The statute of frauds requires real estate sales contracts to be in writing and signed to be enforceable.

Question 11

A buyer of a planned community unit may void the agreement of sale:

Accepted Answer

Section 5407 makes the contract voidable by the buyer until the certificate has been provided and for five days after, or until conveyance, whichever occurs first. The clock runs from receipt of the certificate, not from signing.

Question 12

Which agreement may be ORAL in Pennsylvania, provided the consumer receives a written memorandum of its terms?

Accepted Answer

RELRA §606.1(b) allows open listings and non-exclusive buyer or tenant agreements to be oral if a written memorandum of terms is provided. Exclusive listings must be in writing with the required contents.

Question 13

A Pennsylvania agreement of sale must state the property's zoning classification EXCEPT when the property is zoned:

Accepted Answer

RELRA §608.2 and the Consumer Notice require the zoning classification unless the property, or each subdividable parcel, is zoned solely or primarily for single-family dwellings.

Question 14

A buyer's deposit check accompanies an offer. Under what condition may the broker hold the check uncashed until the offer is accepted?

Accepted Answer

Section 35.324(b) allows holding an offer check until acceptance only with written permission of both buyer and seller. It must then be deposited within 1 business day of acceptance.

Question 15

Besides zoning and the Recovery Fund, a broker-prepared Pennsylvania agreement of sale must include notice that:

Accepted Answer

RELRA §608.2 requires a statement that access to a public road may require a highway occupancy permit from the Department of Transportation. Payment of transfer tax is a matter of contract, not a mandatory allocation.

Question 16

A party making an offer to buy is the ____, and the party receiving it is the ____.

Accepted Answer

The offeror makes the offer; the offeree receives it. When a counteroffer is made, the roles swap.

Question 17

When a seller changes a term of the buyer's offer and returns it, this creates a:

Accepted Answer

Altering any term rejects the original offer and creates a counteroffer, which the buyer may accept or reject.

Question 18

A mortgage lender offers a salesperson $200 for every client referred. Under RESPA this is:

Accepted Answer

RESPA prohibits kickbacks and unearned referral fees between settlement service providers and real estate licensees, even if disclosed.

Question 19

Which term may LAWFULLY appear in a Pennsylvania exclusive listing?

Accepted Answer

A description of services is a required element under §35.331. Broker purchase options, authority to sign the agreement of sale, and confession of judgment are all prohibited by §35.332(c).

Question 20

Which statement must appear in every Pennsylvania written agreement under which a consumer may owe a fee?

Accepted Answer

49 Pa. Code §35.331(a) requires a Recovery Fund statement, an escrow statement, a statement that the fee and duration were negotiated, a description of services and fees, multiple-party service disclosure, and the continuing duty to disclose conflicts.

Question 21

A contract that is missing an essential element, such as consideration, is:

Accepted Answer

Missing an essential element makes a contract void from the start. A voidable contract appears valid but may be canceled by one party.

Question 22

Under an open listing, the seller owes a commission to:

Accepted Answer

Open listings are non-exclusive; only the procuring broker is paid, and the owner owes nothing for a self-sale.

Question 23

The maximum term of an exclusive listing agreement in Pennsylvania is:

Accepted Answer

49 Pa. Code §35.332(c) prohibits an exclusive listing with a listing period longer than 1 year.

Question 24

The federal law that prohibits price fixing, group boycotts, market allocation and tie-in agreements is the:

Accepted Answer

The Sherman Antitrust Act of 1890 prohibits conspiracies in restraint of trade, including these practices.

Question 25

An exclusive right-to-sell listing in Pennsylvania must contain a bold-face statement that:

Accepted Answer

Section 35.332(b)(4) requires a bold-face statement that the broker earns a commission on a sale made during the listing period by whomever it is made, including the owner. The second choice describes exclusive agency, not exclusive right-to-sell.

Pennsylvania real estate contracts practice test

1. A contract that has all legal elements but where one party may cancel is:

2. A licensee representing the seller who learns the buyer will pay more than the offer must:

3. A seller has already accepted an offer, and another buyer submits a higher offer. The listing agent should:

4. Adding a new financing contingency to an existing sales contract is done by a(n) , while changing the existing closing date is done by a(n) .

5. A contract clause stating that 'time is of the essence' means:

6. With proper written permission, a broker held a deposit check with an offer. The seller accepted the offer on Tuesday. The check must be deposited by:

7. An offer or counteroffer becomes a binding contract when:

8. A buyer offers $300,000. The seller counters at $315,000. The buyer rejects the counter and then tries to accept the original $300,000 offer terms. Is there a contract?

9. Under a land contract (contract for deed), during the payment period the buyer holds:

10. Under the statute of frauds, a real estate sales contract must be:

11. A buyer of a planned community unit may void the agreement of sale:

12. Which agreement may be ORAL in Pennsylvania, provided the consumer receives a written memorandum of its terms?

13. A Pennsylvania agreement of sale must state the property's zoning classification EXCEPT when the property is zoned:

14. A buyer's deposit check accompanies an offer. Under what condition may the broker hold the check uncashed until the offer is accepted?

15. Besides zoning and the Recovery Fund, a broker-prepared Pennsylvania agreement of sale must include notice that:

16. A party making an offer to buy is the , and the party receiving it is the .

17. When a seller changes a term of the buyer's offer and returns it, this creates a:

18. A mortgage lender offers a salesperson $200 for every client referred. Under RESPA this is:

19. Which term may LAWFULLY appear in a Pennsylvania exclusive listing?

20. Which statement must appear in every Pennsylvania written agreement under which a consumer may owe a fee?

21. A contract that is missing an essential element, such as consideration, is:

22. Under an open listing, the seller owes a commission to:

23. The maximum term of an exclusive listing agreement in Pennsylvania is:

24. The federal law that prohibits price fixing, group boycotts, market allocation and tie-in agreements is the:

25. An exclusive right-to-sell listing in Pennsylvania must contain a bold-face statement that:

Sources