2024 Edition

Illinois Real Estate Practice Exam

Take this free practice test to get an idea of what is on the Illinois Real Estate Broker exam administered by the illinois Department of Financial and Professional Regulation. The actual exam consists of two tests, a national exam of 100 questions and a state exam with 40 questions.

To prepare for the actual exam, check out our 145 Question Illinois Real Estate Broker Practice Exam with the same number of questions as the actual exam plus 350 bonus core real estate questions.

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Section 1 - Illinois Licensing

1.	Joe is interested in selling real estate. He owns several properties himself and wants to help his friends with listing and selling their properties. Which of the following would apply to him?
		a. Joe does not need to obtain a real estate license as he already owns his own properties.
		b. Joe needs to obtain a real estate license to sell real estate on the behalf of others for compensation.
		c. Joe is limited to leasing and managing property for others without a real estate license.
		d. Joe only needs to obtain a residential leasing agent's license to sell or lease real property.
Joe needs to obtain a real estate license if he plans on selling, leasing exchanging purchasing, renting or leasing real estate on the behalf of another for compensation. It is illegal for anyone to act as a broker, managing broker or residential leasing agent without a real estate license issued by IDFPR when they plan on assisting in the selling, exchanging, purchasing, renting or leasing real property on the behalf of someone else. Incorrect answer. Please choose another answer.

2.	Tony recently turned 20 years old and has been a real estate broker for the past two years. Tony is interested in starting his own brokerage and becoming the designated managing broker. Does Tony qualify to become a managing broker?
		a. Yes.
		b. No, he must be at least 21 years of age.
		c. No, he must have a corporation formed before applying.
		d. No, he needs to practice as a real estate broker for 4 years first.
Tony qualifies to apply for a managing broker license. The law only requires the applicant be 20 years old and have been practicing as a broker 2 out of the previous 3 years. Incorrect answer. Please choose another answer.

3.	Cathy had just completed six years of working with a PB Real Estate and is now ready to go work at her best friend's brokerage which opened up in her neighborhood. Cathy made sure to meet with her future designated managing broker and had an exit interview with PB Real Estate. What step must she take next to continue working as a broker?
		a. No further action is need to be taken.
		b. Cathy must register the new sponsoring brokerage on the IDFPR's website.
		c. Cathy must take her 45-hour post licensing course to qualify to work for another brokerage
		d. Cathy should give a copy of her new license with the new brokerage to her old brokerage.
Cathy's new designated managing broker must register her on the IDFPR website as one of its licensees. After Cathy is sponsored by the new brokerage, she will only be able write business for the new sponsoring brokerage. License law states a licensee can only do licensed activities for the sponsoring brokerage that sponsors their license. Incorrect answer. Please choose another answer.

4.	What is the purpose of licensing real estate brokers?
		a. To resolve compensation disputes between agents.
		b. To protect the public and to establish a level of competency in the marketplace.
		c. To protect homeowners against loss of equity in their homes.
		d. To create an industry that employees many people.
The requirement that real estate brokers be licensed and regulated by the state is to protect the public and to establish a level of competency in the marketplace. This creates the same level of competency for anyone entering into the business and getting either a Broker's license, Residential Real Estate license, or Managing Broker's license. Brokers are to meet an ordinary level of care in communicating with their clients and have a duty to exercise good faith since they are in a position of trust. Incorrect answer. Please choose another answer.

5.	Real estate agent Charles wants to list cooperatives (co-ops) but he only has a real estate broker's license. Which of the following should he do?
		a. Get a securities license to list co-ops.
		b. Refer his co-op opportunities to someone who deals in securities.
		c. Become an owner in the co-ops he lists.
		d. He will not need to do anything since he can sell co-ops with his broker's license.
Although co-ops are owned by a nonprofit corporation and the tenants receive shares and act as shareholders, the tenants receive a proprietary lease and a securities license is not needed to deal in the sale of co-op units. A real estate licensee is authorized to represent buyers or sellers in the sale of co-op units. Incorrect answer. Please choose another answer.

Section 2 - Practice of Real Estate Sales in Illinois

6.	Listing Broker Laura is hosting an Open House for a seller. Beth comes into the Open House and explains to Laura that she already has an agent and simply wants to take a look at the house. What should Laura do?
		a. Discuss dual agency with Beth.
		b. Tell Beth to come back to see the house with her agent.
		c. Tell Beth that she cannot speak to her since she is represented by another agent.
		d. Show Beth the property and then follow up with her agent.
A seller's agent, when hosting an open house, can show the property to prospective buyers who have real estate agents, including answering any questions the buyer may have about the property. The seller's agent should honor the buyer's brokerage relationship and follow up with buyer's broker after the open house. Incorrect answer. Please choose another answer.

7.	Buyer Broker Ben routinely reaches out to the sellers of all of the properties he shows directly, even if the sellers have an exclusive right to sell listing agreement with their own listing broker. Is this acceptable conduct?
		a. Yes, as the best deals are formed negotiating directly with the sellers.
		b. No, license law prohibits negotiating directly with the client of another agent.
		c. Yes, as long as the seller's agent does not complain.
		d. Yes, as long as the seller signs a dual agency disclosure form.
Negotiating directly with a client of another agent is cause for discipline under the Illinois License Act. Agents cannot directly negotiate with the client of another broker. Broker Ben, in this question, will be in violation of the license law as he is negotiating directly with the clients of other agents. Incorrect answer. Please choose another answer.

8.	If an unlicensed person engages in the sale of real estate for others and receives compensation, what is the potential penalty they face?
		a. up to a $5,000 fine per occurrence.
		b. up to a $10,000 fine per occurrence
		c. up to a $25,000 fine per occurrence
		d. None of the above.
Anyone who conducts real estate activities on the behalf of someone else for a fee must have a real estate license. According to the license law, the fine for unlicensed practice of real estate is $25,000 per occurrence. Incorrect answer. Please choose another answer.

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9.	The Illinois homestead exemption will protect a homeowner from which of the following?
		a. Federal income tax judgment lien
		b. County real estate tax lien
		c. Mechanic's lien for work on the home
		d. None of the above
In Illinois, homeowners are given a homestead exemption in the event they have to pursue bankruptcy or other protections from creditors. The exemption gives single persons $15,000 equity protection and married couples $30,000 equity protection. The exemption may not apply to all creditors. It will not apply to state, county and municipal government tax liens, for example. It will also not apply to judgments for Federal taxes, since the federal laws supersede state laws. Finally, the exemption will be limited where a contractor did work on the home, has not been paid and obtained a mechanic's lien. Incorrect answer. Please choose another answer.

10.	STR Real Estate is holding the earnest money for an upcoming closing. A home inspection revealed that the property needs a new roof. What should the designated managing broker do with the earnest money?
		a. Leave it in escrow until the transaction closes.
		b. Take the earnest money out of the escrow account and give it to the seller for a new roof.
		c. Take the earnest money out of the escrow account and give it to the buyer so they can get a new roof.
		d. Take the earnest money out of the escrow account and give it to the buyer since the contract will be terminated.
According to license law, the earnest money must stay in the escrow account until the transaction either closes or fails, and in that situation, it can only be released if the person holding the escrow money receives an authorization and consent form to release earnest money signed by the buyer and seller or their legal representatives. Incorrect answer. Please choose another answer.

11.	Ben is the buyer's agent for his client Betty and she has just seen a property she is interested in to make an offer. When should Ben give Betty a copy of the Illinois Residential Real Property Disclosure?
		a. Before making an offer
		b. After signing of the contract
		c. During the inspection period of the contract
		d. At closing
The Illinois Residential Real Property Disclosure is intended to provide prospective buyers with reliable information on the major conditions of the property. The licensee should provide a client with the disclosure when the client becomes interested in a property to help them make an offer and before signing the contract. The client is to be able to make an informed decision about the property prior to writing an offer. Incorrect answer. Please choose another answer.

12.	One of your clients is about to go through a divorce and wants to know how the sale of their house may impact the divorce. What should you do?
		a. Ask if the property is titled as tenants in the entirety.
		b. Discuss common property generally and how it is divided to give good customer service.
		c. Recommend they speak with their legal counsel.
		d. Tell them not to worry about it, it can be handled at the closing
Licensees must be careful not to act outside of the scope of their real estate license and give legal advice. If they do so, it will constitute the unauthorized practice of law. The licensee should direct the client to speak with their legal counsel. Incorrect answer. Please choose another answer.

13.	In Illinois, who usually pays the real estate transfer tax in real estate sale transactions?
		a. Buyer
		b. Seller
		c. Seller's Attorney
		d. Mortgage Loan Officer
In Illinois, there is a state and county real estate transfer tax. The seller typically pays the transfer tax. Incorrect answer. Please choose another answer.

14.	In Illinois, if a person dies without a will, and has no heirs, what happens to their real property?
		a. It will escheat to the county government.
		b. It will be annexed by a neighbor.
		c. The state will use its right of eminent domain to take the property
		d. It will be foreclosed on by creditors.
In Illinois, if a person passes away without a will, and has no heirs, their real property will escheat to the county where it is located. Therefore, if the deceased has real property in Cook County and passed away without a will and had no heirs, the title to the real property will be transferred to Cook County. Incorrect answer. Please choose another answer.

15.	A legal description of land is defined as which of the following?
		a. The property address
		b. A general description of the area where land is located
		c. A description sufficient to identify land for legal purposes
		d. A metes-and-bounds method
A legal description is not the same as an address. A legal description is a detailed way of describing a parcel of land that it will be sufficient, legally, to identify the property in such instructions as deeds and mortgages. There are three basic surveying methods to create a legal description: (1) Metes-and-Bounds method; (2) Rectangular (Government) Survey; and (3) Lot and Block (Recorded Plat) System. Incorrect answer. Please choose another answer.

Section 3 - Illinois Real Estate Disclosures

16.	What disclosure is needed when a rental finding service provides information regarding possible rental units?
		a. That the information may be up to two days old.
		b. A statement that the information is true to the best of their knowledge.
		c. Whether the unit requires a security deposit.
		d. None of the above.
Under Illinois law, a rental finding service must disclose that the information it is providing on the rental units they are advertising may be up to two days old. Incorrect answer. Please choose another answer.

17.	In Illinois, a beneficiary of a land trust must be revealed under which of the following circumstances:
		a. If they created it within the last 120 days.
		b. If the purchase is for raw land only.
		c. If the land trust is going to be used as a non-profit.
		d. If a fire inspector or another officer is investigating arson.
In Illinois, a land trust can provide the opportunity for the beneficiary to be anonymous. However, this is does not apply in all situations. One of conditions that would require the disclosure of the beneficiary is if a fire inspector or another officer is investigating arson. Incorrect answer. Please choose another answer.

18.	Which of the following documents, given to the seller by the seller's sponsoring broker, discloses the agency relationship between them?
		a. Title Agent Affiliation Disclosure
		b. Real Estate Purchase and Sale Agreement
		c. Listing Agreement
		d. Real Property Disclosure
A listing agreement, also known as a brokerage agreement, is a contract between a sponsoring broker and a seller for the broker to represent the seller in the sale of the seller's real estate in return for compensation. The listing agreement is not a real estate contract, but an employment contract. Under Illinois license law, only a sponsoring broker can act as agent to list, sell and/or rent the real estate of another person. The listing agreement will set forth the type of agency relationship the agreement creates. Exclusive brokerage agreements must be in writing under Illinois license law. Incorrect answer. Please choose another answer.

19.	Louie is the listing broker for a seller. As the designated agent, Louie may offer all of the following services, except:
		a. Complete the seller's disclosure for the seller
		b. Provide requested documents to the buyer's agent
		c. Take photographs of the property for sale
		d. Disclose to the seller information about the buyer
As the designated agent for the seller, a listing agent cannot complete the Illinois Residential Real Property Disclosure for the seller. The seller and the seller alone, independent of any assistance from the listing broker should complete the Illinois Residential Real Property Disclosure disclosing the condition of the property. Incorrect answer. Please choose another answer.

20.	Stan the seller has just informed his listing broker that a murder suicide happened on site at the property. Stan asks his listing broker whether he must disclose the murder suicide in the Illinois Residential Real Property Disclosure. What should his agent tell him?
		a. That murder and/or suicide is required to be disclosed by law.
		b. That he is under no obligation to disclose the murder/suicide.
		c. That he should disclose it to give notice to interested buyers.
		d. That he cannot take the listing.
In Illinois, there is no requirement to disclose that the listed property is the site of a crime, such as murder suicide. Disclosure of such information may stigmatize the property. The agent should make sure the seller knows that there is no obligation to disclose it. Incorrect answer. Please choose another answer.

Quality starts with who wrote the material.

Our practice exam writer

Lisa Risco

Lisa is a licensed real estate broker from Pennsylvania who teaches real estate classes at the Polley Associates School of Real Estate. She has worked with Re/Max and Century 21 in Philadelphia. Lisa received her MBA degree from Eastern University.

Our material is specific to the Pennsylvania Real Estate Salesperson Exam, covering both the National and State sections with these content areas:

Legal Descriptions
Property Use
Forms of Ownership
Recording of Title
Property Appraisal
Contracts
Agency
Financing
Transfer of Property
Disclosures
Settlment
Real Estate Practice
and more..

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