Free South Dakota Math Practice Test — LicenseIQ

Question 1

To qualify as a homestead, a mobile home must be larger than 240 square feet at its base and registered in South Dakota for at least:

Accepted Answer

43-31-2 requires registration in South Dakota at least six months before the claim.

Question 2

A family's farmhouse sits on 240 contiguous acres outside any town plat. How much may be claimed as homestead?

Accepted Answer

43-31-4 limits a homestead outside a town plat to 160 acres in the aggregate.

Question 3

A lender approves a $276,000 loan and the buyer wants to keep an 80% LTV. What is the maximum purchase price?

Accepted Answer

Purchase price = loan / LTV = $276,000 / 0.80 = $345,000. ($220,800 wrongly multiplies by 0.80.)

Question 4

A buyer purchases a $300,000 home with a $60,000 down payment. What is the loan-to-value (LTV) ratio?

Accepted Answer

Loan = $300,000 - $60,000 = $240,000; $240,000 / $300,000 = 80% LTV. (20% is the down payment percentage.)

Question 5

An investment property with NOI of $63,000 sells for $900,000. What is the capitalization rate?

Accepted Answer

Cap rate = NOI / value = $63,000 / $900,000 = 0.07 = 7%.

Question 6

A home sells for $520,000 with a 5% commission. The listing broker pays 2.5% to the buyer's broker and splits the listing side 60/40 with the listing salesperson (salesperson gets 60%). How much does the listing salesperson earn?

Accepted Answer

Total = $520,000 x 0.05 = $26,000. Buyer broker gets 2.5% = $13,000, leaving $13,000 for the listing side. Salesperson = $13,000 x 0.60 = $7,800.

Question 7

A home sells for $389,000. The seller pays a 5% commission, a $212,600 mortgage payoff, $1,200 attorney fee, $1,950 transfer tax and $600 in other costs. What are the seller's net proceeds?

Accepted Answer

Commission = $389,000 x 0.05 = $19,450. Total costs = $19,450 + $212,600 + $1,200 + $1,950 + $600 = $235,800. Net = $389,000 - $235,800 = $153,200.

Question 8

A buyer purchases a home for $425,000 with a loan of $361,250. What is the LTV?

Accepted Answer

LTV = loan / price = $361,250 / $425,000 = 0.85 = 85%. (15% is the down payment percentage.)

Question 9

Under Commission guidance, an interest-bearing trust account for a specific transaction requires:

Accepted Answer

SDREC guidance limits interest-bearing accounts to substantial, long-held sums for a specific transaction, requires written agreement of all interested parties on how interest is divided, and bars the broker from benefiting.

Question 10

A buyer contracts to buy a home for $300,000, but it appraises at $290,000. The lender offers 75% LTV. What is the maximum loan?

Accepted Answer

LTV is applied to the LESSER of price or appraised value: $290,000 x 0.75 = $217,500. Using the $300,000 price ($225,000) is the common mistake.

Question 11

An 8-unit building rents for $1,100 per unit per month with 5% vacancy. Annual operating expenses are $28,320 (excluding debt service). At an 8% capitalization rate, what is the value?

Accepted Answer

PGI = 8 x $1,100 x 12 = $105,600; less 5% vacancy = $100,320; NOI = $100,320 - $28,320 = $72,000; value = $72,000 / 0.08 = $900,000.

Question 12

A 275-gallon heating oil tank costs $168 to fill at $4.20 per gallon. The buyer will credit the seller for the oil remaining in the tank. What is the credit?

Accepted Answer

Gallons needed = $168 / $4.20 = 40; remaining = 275 - 40 = 235 gallons; credit = 235 x $4.20 = $987.

Question 13

A home sells for $412,750. What transfer fee will be charged when the deed is recorded?

Accepted Answer

$412,750 / $500 = 825.5, rounded up to 826 units; 826 x $0.50 = $413.00.

Question 14

What is the largest monetary penalty the Commission may impose for a licensee's unprofessional conduct?

Accepted Answer

36-21A-68 allows a monetary penalty of up to $2,500, alone or combined with revocation, suspension or reprimand. $5,000 and $10,000 are caps used in other states.

Question 15

Which sanction may the South Dakota Real Estate Commission NOT impose by itself?

Accepted Answer

The Commission may revoke, suspend, reprimand or fine up to $2,500 (36-21A-68). Jail can result only from criminal prosecution in court; a violation of the chapter is a Class 1 misdemeanor (36-21A-87).

Question 16

One discount point equals what percentage of the loan amount?

Accepted Answer

One point = 1% of the loan amount (not the purchase price), paid to lower the interest rate.

Question 17

According to Commission guidance, a broker may keep some of the broker's own money in the trust account in order to:

Accepted Answer

SDREC guidance permits broker funds to cover bank fees, tracked as broker funds or equity. Other mixing is commingling under 36-21A-71(5).

Question 18

A commercial space of 2,400 rentable square feet is quoted at $27 per square foot per year. What is the monthly rent?

Accepted Answer

Annual rent = 2,400 x $27 = $64,800; monthly = $64,800 / 12 = $5,400. Commercial rates are quoted per square foot per YEAR.

Question 19

What is the South Dakota transfer fee on a $318,400 sale?

Accepted Answer

$318,400 / $500 = 636.8, and any fraction counts as a full unit, so 637 x $0.50 = $318.50. $318.40 forgets to round up.

Question 20

A lender offers a 95% LTV loan. The buyer has $18,000 for the down payment. What is the maximum purchase price?

Accepted Answer

At 95% LTV the down payment is 5% of price. Price = $18,000 / 0.05 = $360,000; loan = $342,000.

Question 21

A borrower pays $4,500 for 1.5 discount points. What is the loan amount?

Accepted Answer

Loan = cost of points / points as a percentage = $4,500 / 0.015 = $300,000.

Question 22

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 23

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 24

Which order qualifies under Commission guidance as authority to disburse disputed earnest money?

Accepted Answer

SDREC guidance identifies court orders, including small claims court orders, as qualifying; otherwise all parties must give written instructions.

Question 25

How many members serve on the South Dakota Real Estate Commission?

Accepted Answer

SDCL 36-21A-13 sets the Commission at five members appointed by the Governor. Seven is a common size in other states, which makes it a tempting but wrong choice.

South Dakota real estate math practice test

1. To qualify as a homestead, a mobile home must be larger than 240 square feet at its base and registered in South Dakota for at least:

2. A family's farmhouse sits on 240 contiguous acres outside any town plat. How much may be claimed as homestead?

3. A lender approves a $276,000 loan and the buyer wants to keep an 80% LTV. What is the maximum purchase price?

4. A buyer purchases a $300,000 home with a $60,000 down payment. What is the loan-to-value (LTV) ratio?

5. An investment property with NOI of $63,000 sells for $900,000. What is the capitalization rate?

6. A home sells for $520,000 with a 5% commission. The listing broker pays 2.5% to the buyer's broker and splits the listing side 60/40 with the listing salesperson (salesperson gets 60%). How much does the listing salesperson earn?

7. A home sells for $389,000. The seller pays a 5% commission, a $212,600 mortgage payoff, $1,200 attorney fee, $1,950 transfer tax and $600 in other costs. What are the seller's net proceeds?

8. A buyer purchases a home for $425,000 with a loan of $361,250. What is the LTV?

9. Under Commission guidance, an interest-bearing trust account for a specific transaction requires:

10. A buyer contracts to buy a home for $300,000, but it appraises at $290,000. The lender offers 75% LTV. What is the maximum loan?

11. An 8-unit building rents for $1,100 per unit per month with 5% vacancy. Annual operating expenses are $28,320 (excluding debt service). At an 8% capitalization rate, what is the value?

12. A 275-gallon heating oil tank costs $168 to fill at $4.20 per gallon. The buyer will credit the seller for the oil remaining in the tank. What is the credit?

13. A home sells for $412,750. What transfer fee will be charged when the deed is recorded?

14. What is the largest monetary penalty the Commission may impose for a licensee's unprofessional conduct?

15. Which sanction may the South Dakota Real Estate Commission NOT impose by itself?

16. One discount point equals what percentage of the loan amount?

17. According to Commission guidance, a broker may keep some of the broker's own money in the trust account in order to:

18. A commercial space of 2,400 rentable square feet is quoted at $27 per square foot per year. What is the monthly rent?

19. What is the South Dakota transfer fee on a $318,400 sale?

20. A lender offers a 95% LTV loan. The buyer has $18,000 for the down payment. What is the maximum purchase price?

21. A borrower pays $4,500 for 1.5 discount points. What is the loan amount?

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

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

24. Which order qualifies under Commission guidance as authority to disburse disputed earnest money?

25. How many members serve on the South Dakota Real Estate Commission?

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