Maryland-Real-Estate-Salesperson Real Estate Maryland Real Estate Salesperson Examination Free Practice Exam Questions (2025 Updated)

The course teaches that the title insurance policy itself specifies coverage and exclusions. Coverage basics appear on Schedule A, while Schedule B—Exceptions clearly lists matters excluded from coverage (e.g., specific recorded easements or restrictions, taxes, and other encumbrances identified in the title search). Therefore, to determine what is not covered, parties must review the policy’s schedule of exceptions.

The course’s Environmental Issues content explains that while owners can perform basic prevention (reducing moisture, sealing entry points, monitoring for signs, installing vapor barriers), the application of many pesticides—particularly restricted-use pesticides and termite treatments—must be performed by properly licensed pest management professionals due to health, safety, and regulatory requirements. Real estate professionals should know when to recommend qualified, licensed contractors for inspections and treatment and understand disclosure duties regarding known infestations and prior treatments.

Maryland law requires licensees to present and explain the statutory agency disclosure—commonly titled “Understanding Whom Real Estate Agents Represent”—at the first scheduled face-to-face meeting with a prospective party. This disclosure explains the types of agency relationships available in Maryland (seller/landlord representation, buyer/tenant representation, and dual agency with possible intra-company agents) and clarifies whom the licensee represents. This requirement is part of Maryland’s agency framework and consumer-protection emphasis in the pre-licensing curriculum.

A contract assignment occurs when a buyer (the assignor) transfers his or her contractual rights to another party (the assignee) before closing.

However, this is only allowed if the original purchase contract permits assignment—that is, if it includes an assignability clause or does not prohibit assignment.

If the contract specifically states “non-assignable” or “assignment requires seller consent,” the assignor must comply with those terms.

This concept appears in the Contracts and Transaction Procedures section of the course.

Reference (Maryland Source):

– Maryland 60-Hour Principles and Practices Course, Real Estate Contracts and Assignments section.

– Maryland Contract Law Principles (General Common Law on Assignability).

Appraisers generally employ three approaches to value: the Sales Comparison Approach (market data), the Cost Approach (replacement/reproduction cost minus depreciation plus land value), and the Income Approach (capitalizing net operating income). Maryland’s pre-licensing curriculum teaches all three as standard methodology, with applicability depending on property type and data availability.

Agency may be created expressly (by written or oral agreement) or by implication through the conduct of the parties. When a licensee and consumer act as though an agency relationship exists—advice, advocacy, and services consistent with representation—without a signed agreement, this is implied agency. Maryland emphasizes avoiding unintended implied agency by using timely written agreements and required disclosures.

The Property Management section of the Maryland pre-licensing course teaches that licensees must monitor their listings for fraudulent online activity, such as rental scams where criminals copy legitimate ads and re-post them with false contact details.

Setting up automated alerts through tools like Google Alerts or If This, Then That (IFTTT) can help licensees detect unauthorized use of their listings or identifying information.

These monitoring tools allow quick corrective action and protect both the brokerage and the public from scams.

Reference (Maryland Source):

– Maryland 60-Hour Principles and Practices Course, Property Management and Advertising Compliance section.

– Maryland Code of Ethics, COMAR 09.11.02.01–.02.

Price fixing occurs when competing firms agree to set prices, fees, or commission rates rather than allowing them to be independently determined. In real estate, this includes agreements among brokers to set commission rates or fee structures—an antitrust violation. Market allocation divides territories or clients, group boycotts are concerted refusals to deal, and tie-in arrangements force the purchase of a second product/service as a condition of sale.

An encumbrance is any claim, charge, or liability attached to real property that burdens the title or limits use, including monetary interests (e.g., liens, such as mortgages, tax liens, mechanic’s liens) and non-monetary/physical interests (e.g., easements, encroachments, deed restrictions). Encumbrances do not necessarily prevent transfer, but they run with the land and affect marketability.

A legal description precisely identifies a parcel of real estate so it can be uniquely located and distinguished from other property. In Maryland, deeds typically include one of several accepted types of legal descriptions: metes and bounds, lot and block, or rectangular survey (where applicable).

Metes and bounds describe the property boundaries using directions, distances, and reference points (monuments).

This ensures that the property can be clearly identified for conveyance and recording purposes.

Items such as the county clerk’s name, developer name, or title abstract are not part of the deed’s legal description.

The financing module defines a Growing Equity Mortgage (GEM) as a fixed-rate loan with scheduled payment increases applied directly to principal, accelerating amortization and reducing total interest over the life of the loan. This differs from negative amortization (where payments don’t cover interest and the balance grows), blanket mortgages (cover multiple parcels with a release clause), and pledged account mortgages (use a pledged savings account to subsidize payments).

In the “Transfer of Title” module, a deed is defined as the written instrument used to convey legal title (ownership) to real property from grantor to grantee. Proper execution and delivery of a deed transfer ownership.

A lien is an encumbrance—a charge against property to secure a debt—not a conveyance.

A mortgage (or deed of trust) is a security instrument that creates a lien; it does not, by itself, convey fee ownership to the lender.

Title is the legal concept of ownership and the bundle of rights; it is not the instrument that transfers ownership.

References (Course Outline/Study Topics):

Maryland 60-Hour Principles and Practices of Real Estate Pre-Licensing Course — “Transfer of Title” (Deeds: purpose, elements, execution and delivery; distinction among title, deed, liens, and mortgages).

For a valid conveyance by deed, in addition to other deed validity requirements (competent grantor, identifiable grantee, granting clause, adequate description, consideration recited, execution, etc.), there must be “delivery and acceptance”. Delivery by the grantor and acceptance by the grantee are the operative acts that pass title. An exchange of money is not required to effect the legal transfer (consideration may be nominal and need not be physically exchanged at that moment). Judicial validation is not a standard requirement for voluntary conveyances.

Under “Leases and Property Management,” the course explains that a net lease requires the tenant to pay base rent plus some or all of the operating expenses, such as property taxes, insurance, and maintenance (often abbreviated as T, I, M). Variations include single-net (N), double-net (NN), and triple-net (NNN) leases.

A gross lease has the landlord paying most operating expenses, with the tenant paying a single rent figure. A percentage lease bases part of rent on the tenant’s gross sales (common in retail). A sublease is a transfer arrangement, not a lease type that determines expense responsibility.

References (Course Outline/Study Topics): Maryland 60-Hour Principles and Practices of Real Estate — “Leases and Property Management” (Gross vs. net vs. percentage leases; expense allocations).

Meeting potential buyer clients in-person allows the licensee to establish agency, verify identity, discuss representation agreements, and assess buyer motivation and qualifications. Maryland’s brokerage-operation standards emphasize that the licensee should determine whether prospects are ready, willing, and able to purchase before proceeding, ensuring compliance with agency-disclosure and record-keeping requirements.

In Maryland practice, standard residential contracts (e.g., the Maryland REALTORS® Residential Contract of Sale) require parties to initial and date each page. This page-by-page acknowledgment demonstrates that both buyer and seller reviewed and consented to the specific terms on every page, reducing disputes over omitted or altered provisions. Final signatures execute the agreement, but initials and dates on each page evidence assent to the entire document as presented.

In real property conveyance, certain interests and transfers occur by operation of law and therefore supersede contrary provisions in a will. Common examples include joint tenancy with right of survivorship, tenancy by the entirety, life estates with a named remainderman, and properly created transfer-on-death/beneficiary designations. These interests vest automatically at death and are not controlled by the decedent’s will.

“Intestate” refers to dying without a valid will and does not itself take precedence over a will. The heirs’ wishes have no legal effect against properly vested interests. Therefore, where applicable, operation of law controls over will terms regarding those interests.

Once a building permit is issued, the local building department monitors the construction process through inspections at key stages (foundation, framing, electrical, plumbing, final).

The purpose of these inspections is to ensure that work complies with state and local building codes and safety standards.

Maryland’s pre-licensing course explains that certified building inspectors—not peers or the builder—conduct these inspections.

Only after passing all required inspections will the department issue a certificate of occupancy (CO) confirming code compliance and permitting lawful use of the structure.

A syndicate is an association of two or more investors who unite their capital to own or develop real estate projects.

When investment interests are offered to the public, the syndicate becomes subject to federal securities regulations administered by the Securities and Exchange Commission (SEC).

Maryland’s pre-licensing course explains that syndications may take the form of limited partnerships, corporations, or real-estate investment trusts (REITs), but the unifying element is pooled investor participation under securities law oversight.

Reference (Maryland Source):

– Maryland 60-Hour Principles and Practices Course, Forms of Ownership and Syndication section.

– Securities Act of 1933 and 1934 (SEC Regulations).