Real Estate License Exams For Dummies E-Book

John A. Yoegel

• Herausgeber: John Wiley & Sons
• Kategorie: Bildung
• Sprache: Englisch

Seitenzahl: 1068

Veröffentlichungsjahr: 2023

Beschreibung

Get ready to close on your new career as a real estate agent Real Estate License Exams For Dummies is packed with all the information you need to know to get your license and begin your lucrative and rewarding real estate career. With four practice tests and 525 flashcards online, you'll be well on your way to launching the real estate career of your dreams. Plus, there are more practice questions throughout each of the subject review sections in the book, so you can work through all the topics covered on the test. With real estate laws for all 50 states, this is your perfect study guide, no matter where you're planning to work. Learn the latest on real estate taxes, contracts, mortgage types, and beyond. Then, get test-day tips that will help you succeed. Real estate, here you come. * Review everything you need to know to pass your real estate licensing exam * Get proven study techniques and testing strategies to help you earn a high score * Use flash cards, a glossary of terms, and online practice tests to prepare * Learn about new fair housing initiatives and other changes in the market Looking to start or restart a career in real estate? Real Estate License Exams For Dummies is your guide.

Leseprobe

Real Estate License Exams For Dummies®

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Table of Contents

Cover

Title Page

Copyright

Introduction

About This Book

Foolish Assumptions

Icons Used in This Book

Beyond This Book

Where to Go from Here

Part 1: Putting Real Estate License Exams into Perspective

Chapter 1: Sold! Taking a Glance at Real Estate License Exams

Checking Out Licensing and Exam Basics

Sign Me Up: Registering for the Exam

Knowing What to Take to the Exam … and What to Leave at Home

Scoring High: Figuring Out How Scores Are Determined

Take Two: Retaking the Exam

Chapter 2: Using Successful Study and Test-Taking Techniques

One Word to Get You Through: PREPARE

Trying Terrific Test-Taking Strategies

Part 2: So You Want to Sell Real Estate: The Job and Basic Laws

Chapter 3: The Job: It Isn’t Just Driving People Around

Recognizing Those in the Real Estate Business and How They Got There

Knowing What a Real Estate Broker/Salesperson Does

Understanding How a Real Estate Broker/Salesperson Gets Paid

Working Hard: Career Opportunities

Property Management: A Special Kind of Career Opportunity

Managing a Real Estate Office: You’re the Boss

Working As an Independent Contractor

Focusing on Job-Related Laws That You Need to Understand

Review Exam Questions

Answers and Explanations

Practice to Reinforce These Concepts

Chapter 4: Understanding Agency Law

Becoming Someone’s Real Estate Agent: You’re Hired

Keeping the Faith: The Relationship between an Agent and a Principal

Meeting Obligations: The Relationship between an Agent and a Customer

Making Money (No, Not at the Copy Machine)

Parting Is Such Sweet Sorrow: Ending an Agency Relationship

Review Exam Questions

Answers and Explanations

Practice to Reinforce These Concepts

Chapter 5: Knowing the Fair Housing Laws for Selling Real Estate

Practicing Fair Housing: The Basics

Don’t Do It: Avoiding Discriminatory Actions

Feeling Safe: Identifying Who’s Protected

Bending the Rules: Understanding Exceptions to the Law

Extra Coverage: Protecting the Disabled from Discrimination

Staying Strong: Enforcing the Law

Review Exam Questions

Answers and Explanations

Practice to Reinforce These Concepts

Part 3: It’s All Mine: Owning and Transferring Real Estate

Chapter 6: Owning It: Estates and Interests

What Do You Own? Understanding Ownership Terms

Focusing on Estates (Even without the Castles)

Eyeing Different Ownership Rights

Review Exam Questions

Answers and Explanations

Practice to Reinforce These Concepts

Chapter 7: Understanding Forms of Real Estate Ownership

Real Estate Ownership: A Solo or Group Activity

Eyeing Special Types of Ownership: Cooperatives, Condominiums, and More

Review Exam Questions

Answers and Explanations

Practice to Reinforce These Concepts

Chapter 8: Knowing the Limitations on Real Estate Ownership

Carrying a Not-So-Heavy Encumbrance: Private Limitations on Property Use

Land-Use Regulation: A Major Public Limitation

The Government Has Its Say: Other Public Limitations on Property Use

Review Exam Questions

Answers and Explanations

Practice to Reinforce These Concepts

Chapter 9: Transferring Ownership: Deeds and Title Closing

Doing the Deed: Delving into Deed Basics

Getting Closure: Title Closing

Review Exam Questions

Answers and Explanations

Practice to Reinforce These Concepts

Chapter 10: Giving Up or Losing Property

Fine by Me: Giving Up Property Voluntarily

By Force: Losing Property Involuntarily

Losing Property Very Involuntarily: Passing Title After Passing Away

Review Exam Questions

Answers and Explanations

Practice to Reinforce These Concepts

Part 4: A House Is Made of Lots of Paper: Legal and Physical Issues

Chapter 11: Contracts 101

Agreeing to Do Something: The Basics of Making a Contract

So Many Choices: Examining Types of Real Estate Contracts

The End of the Line: Discharging a Contract

Breaching a Real Estate Contract

Review Exam Questions

Answers and Explanations

Practice to Reinforce These Concepts

Chapter 12: Leasing Property

Identifying Who’s Who and What’s What

The Usual Suspects: Preparing a Typical Lease

Distinguishing among Various Types of Leases

Breaking a Lease: Types of Eviction

Getting What You Paid For

Review Exam Questions

Answers and Explanations

Practice to Reinforce These Concepts

Chapter 13: Dealing with Environmental Government Regulations and Issues

Deciphering the Federal Government Alphabet Soup

Assessing the Environmental Effects of Building Developments

This Stuff Can Make You Sick: Examining Environmental Pollutants and Situations

Go with the Flow: Water and Waste Issues

Review Exam Questions

Answers and Explanations

Practice to Reinforce These Concepts

Part 5: You Want How Much? Valuation and Financing of Real Estate

Chapter 14: Appraising Property

Figuring Out Appraisal Basics

Understanding the Importance of Location!

Arriving at Different Types of Value

Creating, Changing, and Affecting Values: Some Economic Factors

Finding Value by Analyzing Comparable Sales

Finding Value by Analyzing Replacement Cost and Depreciation

Finding Value by Analyzing a Property’s Income

Reconciling a Property’s Value

Review Exam Questions

Answers and Explanations

Practice to Reinforce These Concepts

Chapter 15: Finding the Money: Mortgages

Understanding Mortgage Basics

Examining Sources of (and Insurance for) Funding

Considerations for Lenders Accepting Mortgages

Grasping the Different Types of Mortgages

Comprehending Mortgage Repayment Plans

Endings You Didn’t Anticipate: Foreclosures, Assumptions, and Assignments

Being Fair: Consumer Protection Laws

Review Exam Questions

Answers and Explanations

Practice to Reinforce These Concepts

Chapter 16: It’s So Taxing: Real Estate Assessment and Taxes

Who Wants Your Money, and What Do They Want with It? Collecting Taxes

Recognizing What’s So Special about Assessments

Go Figure! Calculating Taxes Step by Step

Home Free (Sort of): Eyeing Property Tax Exemptions

That’s Not Right: Protesting Assessments

Pay or Lose: Tax Liens and Sales

Review Exam Questions

Review Exam Answers

Practice to Reinforce These Concepts

Chapter 17: Investing in Real Estate

Focusing on Property Investment

Partnering Up: Real Estate Investment Organization Structures

Spending Spree: Acquiring and Building Investments

Making Money by Investing in Real Estate

Getting Uncle Sam’s Help: The Government’s Role in Investing

By the Numbers: Analyzing Investment Properties

Review Exam Questions

Answers and Explanations

Questions to Reinforce These Concepts

Chapter 18: All in the Numbers: Real Estate Mathematics

Don’t Lose the Faith, but You May Have to Convert

Land and Buildings: Measuring Area and Volume

Percentages: Pinpointing What You Really Need to Know

Commissions: Tracking Your Moolah

Making Mortgage Calculations without a Fancy Calculator

Oh, the Pain: Calculating Taxes

Putting Proration into Perspective

Appreciating Appreciation and Depreciation

Estimating Appraised Value

Review Exam Questions

Answers and Explanations

Part 6: You’re Ready: Taking Practice Exams

Chapter 19: Practice Exam One

Chapter 20: Answers and Explanations to Practice Exam One

Chapter 21: Practice Exam Two

Chapter 22: Answers and Explanations to Practice Exam Two

Chapter 23: Practice Exam Three

Chapter 24: Answers and Explanations to Practice Exam Three

Chapter 25: Practice Exam Four

Chapter 26: Answers and Explanations to Practice Exam Four

Part 7: The Part of Tens

Chapter 27: Ten Things to Find Out from Your State’s Real Estate Law

Agency Law

Fair Housing

License Law

Limitations on Land Use

Money Stuff

Ownership Rights, Forms, and Theories

Property Disclosure

Tenants’ Rights and Rent Control

Transferring Ownership Involuntarily

Transferring Ownership Voluntarily

Chapter 28: Ten Tips to Help You Succeed on the Exam

Taking the Exam as Soon as You Can

Knowing the Rules (and Following Them)

Studying Your State License Law

Remembering Important Vocabulary

Focusing on Key Concepts

Eating Something

Staying Cool, Calm, and Collected

Paying Attention (without Overthinking)

Going with Your Initial Instinct

Finishing the Job

Appendix: Glossary

Index

About the Author

Connect with Dummies

End User License Agreement

List of Tables

Chapter 16

TABLE 16-1 Figuring Assessed Values

List of Illustrations

Chapter 9

FIGURE 9-1: Townships are divided into 36 sections numbered consecutively.

FIGURE 9-2: Sections can be divided in a variety of ways, including quarters an...

FIGURE 9-3: A quarter section can be split into smaller parts.

FIGURE 9-4: An example of a subdivision.

Chapter 18

FIGURE 18-1: Square measuring 100 feet on each of the four sides.

FIGURE 18-2: Rectangle measuring 150 feet by 80 feet.

FIGURE 18-3: Triangle with a base of 30 feet and a height of 12 feet.

FIGURE 18-4: Circle with a diameter of 16 feet.

Guide

Cover

Table of Contents

Title Page

Copyright

Begin Reading

Appendix: Glossary

Index

About the Author

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Real Estate License Exams For Dummies®, 5th Edition

Published by: John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030-5774, www.wiley.com

Copyright © 2024 by John Wiley & Sons, Inc., Hoboken, New Jersey

Published simultaneously in Canada

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Introduction

So you want to become a real estate agent? Welcome to the book that’s going to help you become one. Being a real estate agent is an extremely attractive career for many people. If you like looking at houses and other kinds of property and enjoy meeting and working with people, this job may be for you. Add to that having a flexible work schedule, essentially running your own business, and being rewarded for working hard and smart, and you’ve pretty much described a career in real estate sales.

Somewhere along the line, however, you discovered that real estate sales is a licensed occupation. Don’t worry, though; I wrote this book specifically to help you get that license. Ready for the full scoop? Read on, you soon-to-be real estate agent.

About This Book

Every state requires real estate agents to have a license to practice their occupation. Every state, at a minimum, also requires that you take and pass a state examination to get that license. Most states require more than just an exam. After you’ve made up your mind to become a real estate salesperson or broker (brokers’ licenses usually are obtained after you’ve spent time as a salesperson), you need to find out what the procedure is for getting your license in your particular state. Because most states have an educational requirement, I assume that you have to take a course before obtaining your real estate license.

So how does this book fit in with your education? I wrote it specifically with the idea of:

Giving you material that is focused on the exam rather than general real estate practice.

Providing you with an additional resource that contains plain English explanations and examples of material that you may encounter in the classroom, in a textbook, or on the exam. Some real estate textbooks are … well … textbooks.

Preparing folks in states that have no education requirements for their state exam.

Providing practice exams with explanations of the answers to help you prepare for the exam.

Helping you study key terms with online flashcards.

Reinforcing key concepts with a series of fill-in-the-blank questions at the end of most chapters.

As the title states, this book is designed to help you prepare for and pass the state exam. In it, I discuss a wide variety of topics, such as the basics of the job, different real estate laws, the details of owning and transferring property, and issues such as contracts, leasing, and environmental regulations. Think that’s a lot? Well, I also cover everything you ever wanted to know about numbers stuff, from appraising property to calculating mortgages, taxes, and investments. And to pull it all together, each chapter contains review questions, and I provide four full-length practice exams (complete with answers and explanations) to help you get ready for the real thing.

A few terms I’ve written about in this book are common to most chapters. Understanding them can help you get the most out of what you read and study and will prepare you for the exam because you’ll run into some of them there, too:

I use the term “real estate agent” to mean anyone who holds some form of license to represent someone else for a fee in a real estate transaction. In most places, there are at least two levels of licensure: broker and salesperson. Some states have more than two. Unless I’m referring to a specific type of license, I use the term “real estate agent.”

The terms “real estate” and “property” are used interchangeably. Even though real estate has a technical definition that I give you in

Chapter 6

, conversational convention is to use those two terms to mean the same thing. The term “property” can be modified as personal property, which is also defined in

Chapter 6

. It can also mean “vacant land,” but that is made clear as necessary.

The term “land” usually means vacant land, or land without structures on it, but it may also be used as a reference to the land-only portion of a property that has a structure on it. For example, “He bought a piece of land on which to build a house.” “Her house sits on very rocky land.”

The word “transaction” as I use it in this book involves any real estate deal. It can and often does mean a change of ownership, but it can also mean negotiating and signing a lease or some other real estate agreement.

I use the words “convey” and “transfer” generally to mean a change in ownership. Real estate can be sold, given away, willed, and exchanged. All of these are conveyances or transfers of ownership.

You may want to go to a party after you pass your real estate exam, but until then, I use the word “party” simply to mean a person or a company, as in, “There were two parties to the deal, a buyer and a seller.”

The terms “landlord” and “tenant” can often be substituted for the terms “buyer” and “seller” when discussing items such as a real estate agent’s representation of someone. In other cases the references are a bit more specific, but you won’t have any trouble figuring out what I’m talking about.

When discussing the relationship of a real estate agent to the person they represent, I use the terms “principal” and “client” interchangeably. The agent represents the principal, also known as the client.

Here’s some general information about what this book is not about. Many real estate textbooks on the market are designed to teach you about real estate. Some of them are used as textbooks in prelicensing real estate courses. Without going into a long explanation about the different approaches that each of these books takes, I want to be clear that this is not a real estate textbook.

Don’t base anything you do in your real estate practice only on what you read in this book. That doesn’t mean that this book doesn’t contain accurate information about general real estate concepts. It does. But as I wrote this book, I had to leave out pieces of information or finer details simply because I don’t believe you’ll be tested on them. This book not only fulfills the purpose of preparing you to take the state exam, but it also provides a general overview of real estate issues. In all cases, whether in your real estate practice or sitting for the exam, you need to defer to information provided by your state licensing authority and any local prelicensing courses you may be required to take if it conflicts with the information in this book.

This book also doesn’t provide legal advice. I’m not an attorney. Real estate sales and related issues are full of topics that many people, including attorneys, believe are matters that require an attorney’s advice or that are best left up to an attorney. I unequivocally advise you that in any issue involving a legal matter, first and foremost, consult an attorney.

One last thing I want to mention concerns the subject of construction — not of the sentences in this book but rather of houses and other buildings. A significant inconsistency exists between and among states regarding whether they require you to know anything about construction for a state-licensing exam. It’s obviously a pretty detailed topic, and I do encourage you to learn something about construction techniques and materials as you start your real estate career. I even include some material about construction regulations in this book. (If you’re curious, check out Chapter 8.) In the interest of space, however, because of this inconsistency I decided to leave out a detailed chapter on construction. You do, however, need to find out whether knowledge of construction techniques, systems, and materials is a requirement for your state exam and then study the appropriate material.

Foolish Assumptions

I hope I’m not being too foolish, but the following are my assumptions about you:

You’re going to take, are taking, or have taken a prelicensing course for the real estate license that you’re seeking (salesperson or broker), or, if your state doesn’t require a course, you’ve already checked to see what the state wants you to know for the exam.

You’re an aspiring real estate agent who needs a tactical guide to improving your score on the real estate license exam.

You still have to work for a living because you haven’t won the state lottery, and you know that real estate can be a great career.

You’re wanting some general knowledge about how real estate works and what agents do. You won’t be disappointed and maybe you’ll decide to become a real agent.

You have a reasonably good command of the English language. Both state exam writers and I assume this. Don’t get discouraged if English is your second language, though. You may want to read what I have to say about this topic in

Chapter 2

.

Icons Used in This Book

The following icons are designed to help you use this book quickly and easily. Be sure to keep an eye out for them.

This icon points out sample questions within chapter discussions.

Items marked with this icon may vary from one state to the next. I usually give some general information about the subject, but when you see this icon, you need to check out the specifics in your own state. Where do you look for those specifics? In general, if you’re not required to take a course or use a textbook to take your state exam, all the material you need to read probably is available from your state licensing agency. (I give you information about how to find your state agency in Chapter 1.) In states where you have to take a course, make sure you look for and study those items that I mention as state-specific in your textbook or course handouts, or ask your instructor about them.

This icon points to information that’s especially important to remember for exam purposes.

This icon presents information like a memory acronym or some other aid to understanding or remembering material.

When you see this icon, pay special attention. The information that follows may be somewhat difficult, confusing, or harmful to ignore.

Beyond This Book

In addition to what you’re reading right now, this book comes with a free access-anywhere Cheat Sheet that includes tips to help you prepare for the real estate licensing exam. To get this Cheat Sheet, simply go to www.dummies.com and search for “Real Estate Licensing Exam For Dummies Cheat Sheet.”

You also get access to four full-length online practice tests (the same four in the book) and approximately 530 flashcards. To gain access to the online practice, all you have to do is register. Just follow these simple steps:

Register your book or ebook at

Dummies.com

to get your PIN. Go to

www.dummies.com/go/getaccess

.

Select your product from the dropdown list on that page.

Follow the prompts to validate your product, and then check your email for a confirmation message that includes your PIN and instructions for logging in.

If you don’t receive this email within two hours, please check your spam folder before contacting us through our Technical Support website at http://support.wiley.com or by phone at 877-762-2974.

Now you’re ready to go! You can come back to the practice material as often as you want — simply log on with the username and password you created during your initial login. No need to enter the access code a second time.

Your registration is good for one year from the day you activate your PIN.

Where to Go from Here

First things first: Contact your state real estate licensing authority and get the information you need for the kind of license you’ll be applying for, such as a salesperson’s license or a broker’s license. (You can get information on how to find your licensing agency in Chapter 1.) If you’re still not sure or you’re a little confused about where you’re headed, you may want to start your reading in Chapter 3, which explains the different jobs real estate agents do.

The information you want from your state includes a copy of the license law, an application, information on the content of the exam (if available), and any other information available about obtaining your real estate license. You may be able to get this information online. (If you’re already a broker, you probably are familiar with most of this. If you’re new to the field, you want the package of information your state sends out for people who want to become a licensed salesperson.)

When you get it, read the information carefully and take the next step. That may be enrolling in a course. In a few cases, it may mean studying the license law and the other information the state sends you. You have to do this anyway, but in states with no education requirement, studying this information and the material in this book is your preparation for the state exam. In either case, check out the chapters in this book that correspond with the subjects required for the type of license you’re getting (see the Table of Contents for help) and start studying. Before you actually take the exam, be sure to check out the information about the basics of the exam in Chapter 1 and my best studying and test-taking strategies in Chapter 2. After studying the different subjects areas for the exams, take the four practice exams in this book. You can download a fill-in-the-bubble answer sheet at www.dummies.com/go/relebubblesheets and use it as you take each practice exam. Download as many sheets as you need. (You also can use them for the ten sample multiple choice questions at the end of chapters that discuss the subject areas.)

If I were your personal tutor as you embark on your real estate education, I’d instruct you to do the following:

Go to class, pay attention, do the homework, and keep up with the reading.

As you progress through your course, study the material in this book related to the material you’re covering in class.

After completing a section or chapter, test yourself with the practice questions at the end of each chapter, and then diagnose your need for more study accordingly.

When you’re ready to take the state exam, take the four practice exams. Use them to diagnose your need for more study in specific areas. I’ve constructed the exams to make it easy to diagnose where you may need more study.

Make sure you study your state real estate license law for state-specific information that you may need to know.

Take the state test, pass it, get your license, and start earning your first million.

Part 1

Putting Real Estate License Exams into Perspective

IN THIS PART …

Understand the different real estate licenses and exams and what each type of license requires and allows you to do.

Incorporate some test-taking tips and tricks in your arsenal to help you pass your exam with as little stress as possible, including some advice for preparing to take the exam as well as hints to help you while you’re in the middle of taking the exam.

Conquer your mathphobia with some solid advice and tips for getting through the math sections of the real estate license exam.

Figure out how the exams are scored, how the scores are determined, and how you can achieve a high score.

Chapter 1

Sold! Taking a Glance at Real Estate License Exams

IN THIS CHAPTER

Uncovering the basics of license exams

Recognizing registration rules

Understanding what to take (and not to take) to the exam

Finding out how exams are scored

Figuring out what to do to retake the exam

A state exam is one of the steps you need to take on your journey to becoming a licensed real estate agent. You may think that it’s the most intimidating step, but don’t worry; that’s where this book comes in. In this chapter, I provide you with information to make sure the exam process isn’t a total surprise and show you a few specific details to check out in your state.

Because individual states issue real estate licenses, the ultimate authority on the state exam is your own home state. You’ll probably get a copy of the state license law and the state-specific information you need about the exam from the instructor of the prelicensing course you may have to take. (See “Figuring out licensing procedures” later in this chapter for more details.) If you don’t get the information from your instructor or if you’re in one of the few states that doesn’t require a prelicensing course, you can write to your state-licensing agency or go online to find information. Different states have different agencies that handle real estate licensing, but using a search engine like Google can get you where you need to go. Just type in your state’s name followed by the words “real estate license law,” “real estate commission,” “real estate board,” or “real estate licensing agency,” and see what websites are listed. If you don’t have access to a computer, try calling information in your state capital and asking for the agency’s phone number, using any of the names I listed.

Checking Out Licensing and Exam Basics

Most states have at least two license levels for their real estate agents: salesperson and broker. (Briefly, a real estate broker is someone authorized by the state to perform certain activities such as sales on behalf of another person for a fee. A salesperson is someone licensed to do those activities but only under a broker’s supervision. See Chapter 3 for more.)

Some states may have other levels or types of licensing, such as a time-share agent, associate broker, or salesperson apprentice or trainee. In any case, a state agency administers real estate license exams in each state (different states may have different names for their licensing agencies). In the following sections, I give you the lowdown on licensing procedures, the differences between the licensing and exams for salespeople and brokers, and the format of the exams themselves.

Figuring out licensing procedures

After you decide to pursue a career in real estate, the next thing you need to do is get as much information as you can about the procedure for obtaining your license. Every state has specific requirements regarding age, citizenship, criminal background, education, and so on. For specifics about all of these necessities, you need to consult your state’s license law directly. Each state’s real estate license law typically has provisions about how to become a real estate agent in that state. In addition, it often has specific requirements regarding procedures to follow in your actual real estate business. And by the way, state exams often contain a few questions about the requirements to get your license, such as how old you have to be or the citizenship requirements. You need to get a copy of your state’s license law either from the state website or from your instructor.

Your state licensing system may treat real estate licensing educational requirements and testing in a wide range of ways. Very few states have no educational requirements whatsoever and require only that you pass the state exam. Other states require that you take (and pass) a minimum number of classroom (or online) hours of education before you sit for the exam. And still other states require you to take not only a minimum number of classroom hours, an apprenticeship, and more educational courses, but also a state exam after one or both classroom experiences. You likely have to take more coursework and pass another exam to become a broker, so expect to become a salesperson first, and get some experience before you can move up to the broker level.

Assume that where education is required — and it is in most if not all states — you have to pass a course exam in addition to the state exam. Your state may have only an attendance requirement, but be prepared for a course exam, nonetheless. Where there is a course exam, it’s usually similar to the state exam. This book helps you do well on both exams.

As for the state exam, some states allow you to walk in and take the state salesperson exam before you complete the required education. Not much point in doing so in my opinion, because the education always helps prepare you for the state exam. And the course exam is good practice for the state exam.

Knowing the difference between salesperson and broker licensing and exams

In most cases, you’re probably pursuing the first or basic real estate license level — in some states it’s a salesperson’s license; in others it’s some form of salesperson trainee. How you move up the real estate ladder varies among the different states. The following illustrates two of the many possibilities.

In one case, you complete all of the necessary requirements, including taking and passing a state exam, to become a licensed real estate salesperson. And that’s it. You can stay a salesperson for the rest of your career. To become a broker in this situation, you probably have to gain some experience, take additional coursework, and pass yet another state exam.

In the second case, you begin your real estate career by getting a license at whatever level your state provides as an apprentice or trainee, which can involve taking a course and/or a state exam. After a prescribed period of experience, you’re required to move up to the level of a full-fledged, licensed salesperson, which can mean more coursework and another licensing exam. You can remain a salesperson for your entire career in this case, too. Moving up the next rung on the ladder to the broker’s level usually involves additional coursework, an exam, and additional experience.

I need to add here that some states may have a way for you to skip part of the salesperson licensing procedure. Although it rarely occurs, doing so usually requires previous real estate experience. The experience may not exempt you from taking all of the required courses, but it may enable you to skip the salesperson exam. You can find out whether your state allows this exemption by checking the license law and speaking with your state-licensing agency. The state has final say over what constitutes a qualifying equivalent but, for example, someone who has bought, sold, and leased a significant number of his own investment properties might have the necessary experience.

Your job as it relates to this book is to identify the particular exam you have to pass at this stage of your real estate career. If you’re taking your first-ever exam, you’re at the salesperson level or the salesperson trainee level. If you’re already a licensed salesperson, you’re shooting for the broker level. Then you need to find out the subject matter on the exam. In the vast majority of states, you’re required to take coursework to get your license. Figuring out what you’re tested on and using this book to help you is relatively easy. Just match up the material in the course with the various subjects in this book. If you’re not required to take coursework to get your license, you can find out your particular exam’s subject matter by checking with your state licensing agency and still use this book to provide information and further explanation of the required material.

This book covers as many of the subject areas as are typical on a variety of state exams. In general, fewer topics are covered on the salesperson’s exam than on the broker’s exam. Broker’s exams cover more subjects because more topics have been added to the list of subjects you learned at the salesperson’s level. For example, a state might test you on property management, which I cover in Chapter 3, on the broker’s exam but not on the salesperson’s exam. So if you’re taking the salesperson’s exam in that state, you don’t need to worry about property management; however, if you’re taking the broker’s exam, it’s time to brush up on your property management knowledge.

If you’re using this book to prepare for a broker’s exam, be aware that many brokers’ exams presume that you learned and remembered everything you covered in your salesperson’s course. Although the emphasis may be on broker subject matter, topics typically on a salesperson’s exam are fair game on the broker’s exam. So it’s a good idea to review all the material from the salesperson’s exam as well as the new broker’s material you learned if you’re taking the broker’s exam.

The topics at the salesperson’s level are usually covered at a more basic level than on the broker’s exam. Definitions and terminology are most important on the salesperson’s exam. The broker’s exam doesn’t cover just additional topics; it may require you to apply your knowledge to specific examples and questions. But don’t think the testers won’t include a few questions that may require you to apply your knowledge to short problems even in the salesperson exam — what I call mini-case studies. I include fill-in-the-blank questions at the end of each subject matter chapter to give you more practice in understanding important concepts. Whether your state uses fill-in-the-blank questions or not, these practice questions help you strengthen your understanding of that chapter’s concepts and terminology.

Two other subjects that should be mentioned for special consideration and preparation are math and ethics. Where appropriate, math formulas and problems are covered in the individual chapters in this book. In addition, Chapter 18 covers a variety of typical real estate math problems. The amount of math on the state exam varies by state. You need to know real estate math to be an effective real estate agent, but especially for you math-phobics you need to find out how much math is on your state exam.

Ethics is another subject that varies by state. You need to find out if your state has its own code of ethics for real estate agents or if it expects adherence to the code of ethics and standards of the National Association of Realtors. Most importantly for passing the exam, you need to find out how much emphasis there is on ethics questions on the state exam.

Looking at the format and other exam details

At any point in time (for example, a week after this book comes out), a state may decide to change its exam content or structure; therefore, talking with any certainty about exam formats is pretty much impossible. Ultimately the format of the exam really shouldn’t matter when compared with a mastery of the material you have to know. Different structures have different approaches to the same material. If you know the material, the structure won’t matter.

Most (if not all) states currently use a multiple-choice question format. Most people feel more comfortable with this format, and students believe these exams are easier to pass because the choices already have been narrowed down for you. Because most states use this format, I chose to write most of the practice questions in this book, including the four full-length practice exams, in a multiple-choice format. How’s that for service?

Exams are either a single, undivided exam or broken into two parts: a general part that covers key concepts, such as forms of real estate ownership, fiduciary responsibilities, and fair housing law, and a state-specific part. In this book you see many state-specific icons directing you to information that may vary from state to state. This type of information may end up on the state-specific part of these exams. In addition, any questions about state license law are covered in the state-specific part of the exam. (For more about license law, see Chapter 3.) This book is especially helpful in preparing you to pass the general part of any two-part exam. It also gives you the necessary background to better understand any state specific material.

You should check with your course instructor or the state-licensing agency about the following exam details:

Number of questions on the exam you’re taking. The salesperson’s and broker’s exams may have a different number of questions.

Whether the exam is a single exam or whether it’s broken into general and state-specific parts. If the exam is divided into parts, find out how many questions are in each part. If the exam is given in two parts, must you pass both parts at the same time; if you don’t pass one part but pass the other, can you retake the part you didn’t pass or must you retake the entire exam.

Whether the questions are multiple-choice or whether any other question format is used.

The form of the exam (paper and pencil or computer).

The time available to complete the exam.

There are a few other questions you should ask about exam procedures, such as what to bring to the exam. I give you this information in the following sections, as well as offer some hints in Chapter 2 about successful test-taking strategies.

Sign Me Up: Registering for the Exam

You’ve fulfilled all your state’s requirements. You’ve taken a course, read the license laws, and so on. These procedures definitely vary by state. In general, though, you have to send an application to the state at some point so you can take the exam. You may have to send the state a completion certificate as evidence that you passed the required prelicensing coursework, and you probably have to submit a fee. Your state’s exam regulations detail whether the fee needs to be paid with cash, check, credit card, or another method. In the case of the salesperson’s exam, some states require you to have your application form signed by a sponsoring broker. (You can find out more about the relationship of a salesperson to a broker in Chapter 3.)

It’s likely that you have to register online to get a date to take the exam. After completing and sending the appropriate materials to the state licensing agency, you receive an entry permit in the mail or a printable one online allowing you to take the exam. You also receive information on where and when to arrive for the exam, as well as a list of anything else you might need to bring with you (see the next section). Read all of the information carefully and follow the instructions exactly. If you have any questions, contact the state-licensing agency well before the exam.

Keep in mind that in some states they may allow you to take the test by simply showing up at the exam site with identification and the fee in hand. This is usually referred to as a walk-in exam.

Whatever the procedure may be, find out what it is from your course instructor or the state-licensing agency, and follow it carefully. It’s silly and completely unnecessary to have your application returned because you forgot to sign it or sent in the wrong amount for the fee.

Knowing What to Take to the Exam … and What to Leave at Home

The big day is almost here. You passed with flying colors whatever prelicensing course you had to take. You also filled out and sent in your application for the exam and got something back in the mail telling you where and when to show up. You reviewed everything in this book that applies to the test you’re taking, and you’re ready to go. Now start packing.

In some places, the question of what to bring to the exam has produced an art unto itself. General security issues are in effect in many public buildings, and you also need to deal with security issues that are specifically pertinent to exam-taking. The key here is simple. Read everything you can in the material, online or hard copy, you receive from your state licensing agency or the testing company your state uses to find out about what you can and can’t bring to the exam. (Some states have contracted with private companies to administer exams; if this is the case in your state, you can get contact information about this from your state licensing agency.) If you have a specific question that isn’t covered in the material, you can call or email the state agency or testing company and get an answer to your question. In general, the items you need to bring are as follows:

A calculator: Pay attention to the requirements for a calculator. Calculators are usually required to be silent, battery-powered, and nonprogrammable. In general, anything that can carry text won’t be permitted. Those of you who have a calculator feature built into your cell phones may not be permitted to use them. In some places, you have to sign a form indicating the kind of calculator you’re using.

If you’re using a battery-powered calculator, change the batteries a few days before the exam, or bring two calculators. If changing the batteries in your calculator is really easy (you don’t need a screwdriver or some other tool), you can also bring new batteries with you, just in case.

An entry permit:

Make sure that you bring the entry permit that you received in the mail after you sent in your application, because it and any other necessary paperwork may be the only documents that enable you to take the exam. Necessary paperwork varies from state to state, so it’s pretty difficult to tell you exactly what you need to bring, but at a minimum you need that entry permit. In states that permit walk-ins at exams, you may need the application itself, plus the fee and probably one or two forms of identification.

No. 2 pencils: Some states have gone to a computerized testing format. If that’s not the case in your state, then you probably need some of those famous No. 2 pencils. Bring more than two with erasers. If you buy new ones, sharpen them before you go to the exam; don’t depend on there being a pencil sharpener at the exam site. Sharpened No. 2 pencils are a little hard to carry. I always put them in a standard-size (No.10) envelope, which by the way, the exam monitors may make you give up. If you need scrap paper, which can be useful even in a computerized exam, ask for it at the testing site.

A pen:

Bringing along a pen with blue or black ink is a good idea in case you have to fill out some form that’s better completed in ink than in pencil.

A photo ID:

An ID of some sort is pretty standard, so bring a photo ID with you. Not all photo IDs are created equal; for example, your state may not count your new photo ID library card. You may even be required to present two forms of ID. And if you’re not a citizen, have the appropriate documentation with you showing your status.

A certificate from your prelicensing course:

Your state may require you to bring the certificate you received that shows that you passed your prelicensing course. In some cases, you may have already sent it in with your application and don’t need to bring it. In either case, when you get the certificate saying that you passed the course, make sure you make a copy of the certificate and keep it in a safe place before you ever send it or give it to anyone. States have been known to lose documents. Some states require that the real estate school you went to send documentation directly from the school to the state certifying that you successfully completed the course. Check to see if your real estate school does that.

Face mask:

At any point a face covering may or may not be required in group settings like an exam site. Bring one just in case.

You probably won’t be allowed to bring scrap paper, food, books, notes, and so on to the exam. In a worst case, you may be turned away from the exam site if you have any of these items with you. In a situation almost as bad, you may be asked to leave the unauthorized item(s) in the hallway outside the exam room. If you need to bring food or water because of a medical condition, make sure you get permission first before the day of the exam. In addition, if you need to make accommodations for a handicap, like the use of a wheelchair, make sure those arrangements are made before the day of the exam.

Scoring High: Figuring Out How Scores Are Determined

Information about scoring is available from your state licensing agency or the testing agency (if any) used by your state. Here are a few points you may want to consider:

Check out whether all the questions have equal weight. For example, a state may give an exam with 100 questions, all worth one point. But another state may give a two-part exam, with the first part having 80 general real estate questions worth one point each and the second part having 40 state-specific questions worth half of a point each. I’ve found in my teaching that this kind of information seems to provide comfort to the students because they feel like they know what’s going on. To some extent, knowing which questions have more weight may guide your studying, but in any case, you have to answer enough questions correctly to pass.

Scoring may vary from state to state; most places give you a percentage based on the number of correct answers given. Passing scores vary by state, as well. In addition, some states make you wait for the test results, sending them to you by mail, whereas some states may be able to give you the results on the same day you take the exam. Your state may just advise you if you passed or failed.

What about getting the big prize — the actual license? In some cases, you can receive a temporary license on the day you pass the exam. In other cases, you get your license in the mail. And in other cases, you have to apply for the license after you get your test results.

Having more than one testing center, a state may vary its procedures from one place to another. One center might be equipped to give you your score and even a temporary license right away; another testing center in the same state may not be able to do that. If getting your license right away is important to you, especially if you have a hot deal ready to go as soon as you have your license, it may be worthwhile to travel a little farther to get instant results.

Take Two: Retaking the Exam

You need to know how many times you can retake the state license exam. Your state may allow unlimited retakes of the exam, or it may limit you to a certain number of retakes before requiring you to take the prelicensing course again. Whichever the case, if you do fail the exam and plan to retake it, don’t wait too long. Try to retake it as soon as possible allowing perhaps a few weeks to study. If you have to reapply to take the exam, do that right away. (But I know that you’ll pass on the first try with the help of this book!)

The same applies if you have to take an exam to complete your real estate course. Find out how many times you can retake it and when and if you would have to retake the course itself.

The exam itself is actually pretty good practice for a second try. Remember the areas with which you had difficulty and concentrate on those areas first as you study for retaking the exam. If you’re lucky and live in a state where you receive some idea of the areas in which you were weak, use the information to study that specific material. You also can use the review questions and practice exams in this book to diagnose your weak areas. Checking out the studying and test-taking tips in Chapter 2 for even more help won’t hurt, either. Above all, don’t grow discouraged. Anyone can fail an exam, but only you can have the stick-to-itiveness to go back and try it again.

Chapter 2

Using Successful Study and Test-Taking Techniques

IN THIS CHAPTER

Figuring out how to get ready for the exam

Understanding tips on how to pass the exam with ease

I want to share something with you that I tell all my students on the first day of class. If you read through Chapter 3