Wisconsin Real Estate License Exam — Questions and Answers

Question 1: Which type of property ownership allows multiple owners with an undivided interest in the property?

Joint tenancy with right of survivorship
Tenancy in common (Correct answer)
Fee simple absolute
Life estate

Correct answer: Tenancy in common

Tenancy in common is a type of property ownership that allows multiple owners to hold an undivided interest in the property. This means each owner has a distinct, proportionate share of the entire property, but not a specific physical portion. Unlike joint tenancy, there is no right of survivorship, allowing each co-owner to sell or will their share independently.

Question 2: A buyer in Wisconsin is using an FHA loan to purchase a home for $250,000. The transaction includes an FHA Amendatory Clause. If the property's appraised value comes in at $240,000, what are the buyer's primary rights under this clause?

The seller is required to lower the purchase price to the appraised value of $240,000.
The buyer must proceed with the purchase but can sue the seller for the $10,000 difference.
The buyer can cancel the contract and receive a refund of their earnest money. (Correct answer)
The buyer is obligated to make up the $10,000 difference in cash to secure the loan.

Correct answer: The buyer can cancel the contract and receive a refund of their earnest money.

The FHA Amendatory Clause, also known as an escape clause, protects the buyer by allowing them to cancel the contract without penalty if the appraised value is less than the sales price. The buyer is not obligated to purchase, and the seller is not obligated to lower the price, but the buyer has the right to back out and recover their earnest money.

Question 3: A property's assessed value is $180,000 and the mill rate is 20 mills. What is the annual property tax?

$36,000
$3,600 (Correct answer)
$1,800
$18,000

Correct answer: $3,600

20 mills = $20 per $1,000; $180,000 ÷ 1,000 × 20 = $3,600 annual property tax.

Question 4: Under Wisconsin law, what is the maximum duration of a standard residential lease before it must be in writing to be enforceable?

6 months
1 year (Correct answer)
2 years
3 years

Correct answer: 1 year

Wisconsin's Statute of Frauds requires any lease exceeding one year to be in writing to be legally enforceable.

Question 5: When must a Wisconsin licensee provide the agency disclosure to a consumer?

At the first substantive contact / negotiation (Correct answer)
After the offer is accepted
Only at closing
Only if the consumer requests it

Correct answer: At the first substantive contact / negotiation

Agency disclosures must be provided early, at the first substantive business contact, so consumers understand the relationship.

Question 6: Loss in value caused by factors outside the property, such as a nearby freeway, is:

Curable depreciation
Functional obsolescence
Physical deterioration
External (economic) obsolescence (Correct answer)

Correct answer: External (economic) obsolescence

External obsolescence is a loss in value from negative influences outside the property boundaries.

Question 7: What does an appraiser call the highest and most profitable legally permitted use of a property?

Speculative use
Fee simple use
Conforming use
Highest and best use (Correct answer)

Correct answer: Highest and best use

Highest and best use is the legal, physically possible, and financially feasible use that yields the greatest value.

Question 8: When a Wisconsin agency relationship ends, which duty typically continues?

Duty to present offers
Duty to promote the client's interests
Duty to negotiate
Duty of confidentiality (Correct answer)

Correct answer: Duty of confidentiality

The duty to keep confidential information private survives the end of the agency relationship.

Question 9: How many hours of pre-license education must a Wisconsin real estate salesperson candidate complete?

40 hours
60 hours
90 hours
72 hours (Correct answer)

Correct answer: 72 hours

Wisconsin requires 72 hours of approved pre-license education for salesperson candidates.

Question 10: Under Wisconsin law, when must a real estate licensee provide the agency disclosure form to a prospective buyer?

At closing
At the first substantive contact (Correct answer)
Only if the buyer requests it
After the offer is accepted

Correct answer: At the first substantive contact

Wisconsin law requires the agency disclosure to be provided at the first substantive contact with a prospective buyer.

Question 11: What is the purpose of earnest money in a real estate transaction?

Demonstrate buyer commitment (Correct answer)
Pay off the seller’s mortgage
Cover title insurance costs
Eliminate closing costs

Correct answer: Demonstrate buyer commitment

Earnest money is a deposit made by the buyer to the seller, typically held in an escrow account, to show their serious intent to purchase the property. It acts as a good faith gesture, assuring the seller that the buyer is committed to the transaction. If the buyer defaults without a valid reason, the seller may be entitled to keep the earnest money as compensation.

Question 12: In Wisconsin, a life estate measured by the life of someone other than the life tenant is called what?

Life estate pur autre vie (Correct answer)
Remainder estate
Fee simple determinable
Estate for years

Correct answer: Life estate pur autre vie

A life estate pur autre vie is measured by the life of a third party rather than the life tenant.

Question 13: A married couple has owned a home in Wisconsin for 10 years, which is classified as survivorship marital property. One spouse individually decides to sell the property to a third party. Which of the following is true regarding the conveyance?

The conveyance can be voided by the third-party buyer but not by the non-signing spouse.
The conveyance is valid only if the other spouse also signs the deed. (Correct answer)
The conveyance is automatically valid as long as the selling spouse's name is on the title.
The conveyance is valid, but the non-signing spouse is entitled to half the proceeds.

Correct answer: The conveyance is valid only if the other spouse also signs the deed.

Under Wisconsin's Marital Property Act, property acquired during the marriage is generally considered marital property. For a conveyance of a homestead, which is a common form of survivorship marital property, the signature of both spouses is required on the deed, even if only one spouse is listed on the title. This ensures both parties consent to the transfer of their shared asset.

Question 14: What is the primary purpose of recording a deed with the Wisconsin Register of Deeds?

To make the transfer legally valid between buyer and seller
To provide constructive notice to the public of the ownership change (Correct answer)
To satisfy federal tax reporting requirements
To activate the buyer's homestead exemption

Correct answer: To provide constructive notice to the public of the ownership change

Recording provides constructive notice to the world that a property transfer has occurred, protecting the new owner against subsequent claims.

Question 15: Housing designated for older persons may lawfully exclude children if it qualifies under the:

Americans with Disabilities Act
Housing for Older Persons exemption (Correct answer)
Equal Credit Opportunity Act
Community Reinvestment Act

Correct answer: Housing for Older Persons exemption

The Housing for Older Persons Act (HOPA) exemption allows qualifying senior housing to exclude families with children.

Question 16: Which type of co-ownership in Wisconsin does NOT include the right of survivorship by default?

Joint tenancy
Tenancy in common (Correct answer)
Survivorship marital property
Marital property

Correct answer: Tenancy in common

Tenancy in common does not include a right of survivorship, so a deceased tenant's share passes through their estate.

Question 17: In Wisconsin, which document is used as the standard offer to purchase residential real estate?

WDRL Purchase Agreement
WRA Form 1
WB-11 Residential Offer to Purchase (Correct answer)
WB-1 Listing Contract

Correct answer: WB-11 Residential Offer to Purchase

The WB-11 is the standard approved form used for residential offers to purchase in Wisconsin.

Question 18: A Wisconsin property manager requires a higher security deposit from tenants who use wheelchairs. Under fair housing law, this practice is an example of discrimination based on which protected class?

Age
Economic status
Disability (Correct answer)
Physical appearance

Correct answer: Disability

Charging higher deposits based on wheelchair use constitutes disability discrimination under both Wisconsin and federal fair housing laws.

Question 19: What is the statute of limitations for filing a fair housing complaint with the Wisconsin Department of Workforce Development?

One year from the date of the alleged discrimination (Correct answer)
180 days from the date of the alleged discrimination
Two years from the date of the alleged discrimination
30 days from the date of the alleged discrimination

Correct answer: One year from the date of the alleged discrimination

In Wisconsin, a complainant has one year from the date of the alleged discriminatory act to file a complaint with the state.

Question 20: A property generates $48,000 in annual net operating income and has a capitalization rate of 8%. What is the estimated property value using the income approach?

$384,000
$480,000
$576,000
$600,000 (Correct answer)

Correct answer: $600,000

Using the income approach formula, value equals net operating income divided by the cap rate: $48,000 ÷ 0.08 = $600,000.

Question 21: What is the role of contingencies in a real estate contract?

Guarantee contract execution
Eliminate the need for inspections
Increase closing costs
Allow contract termination if conditions aren’t met (Correct answer)

Correct answer: Allow contract termination if conditions aren’t met

Contingencies are clauses in a real estate contract that specify conditions which must be met for the sale to proceed. They protect both buyers and sellers by allowing a party to terminate the contract without penalty if a specified condition, such as a satisfactory home inspection or securing financing, is not fulfilled. This provides an escape clause, ensuring the parties are not bound to an unfavorable deal.

Question 22: A home in Green Bay, Wisconsin sells for $350,750. What is the amount of the Wisconsin Real Estate Transfer Fee (RETF) that must be paid at closing?

$1,050.00
$350.75
$1,052.40
$1,053.00 (Correct answer)

Correct answer: $1,053.00

The Wisconsin Real Estate Transfer Fee is calculated at a rate of $3.00 for every $1,000 of value. The value is rounded up to the next nearest $100. In this case, $350,750 is rounded up to $350,800. The calculation is ($350,800 / $1,000) * $3.00 = $1,052.40. An easier way to calculate is to round the value up to the next $100 and multiply by 0.003. So, $350,800 * 0.003 = $1,052.40.

Question 23: A Wisconsin licensee discovers a hidden water leak that the seller wants hidden. The licensee must:

Only tell the buyer if asked directly
Disclose the material adverse fact to all parties (Correct answer)
Follow the seller's wish and stay silent
Charge the seller a fee to disclose

Correct answer: Disclose the material adverse fact to all parties

Material adverse facts must be disclosed to all parties even if the client instructs otherwise, since the duty of disclosure overrides obedience.

Question 24: Wisconsin homestead protection primarily shields a portion of a homeowner's equity from:

Fair housing complaints
Zoning enforcement
Certain creditors' claims (Correct answer)
Property taxes

Correct answer: Certain creditors' claims

The Wisconsin homestead exemption protects a set amount of home equity from most unsecured creditors.

Question 25: When a firm designates different agents to represent the buyer and seller separately, this is called:

Open agency
Customer service
Designated agency (Correct answer)
Subagency

Correct answer: Designated agency

Designated agency assigns individual licensees within one firm to each party.

Question 26: A Wisconsin licensee who violates fair housing law may face discipline from which board in addition to state fair housing penalties?

Public Service Commission
Ethics Board
Department of Revenue
Real Estate Examining Board (Correct answer)

Correct answer: Real Estate Examining Board

The Real Estate Examining Board can discipline licensees for fair housing violations.

Question 27: A 'defect' on the Wisconsin RECR is defined as a condition that would have a significant adverse effect on:

The seller's asking price
The neighborhood average
The broker's commission
The value of the property or health/safety of occupants (Correct answer)

Correct answer: The value of the property or health/safety of occupants

The RECR defines a defect as something significantly affecting value or the health and safety of occupants.

Question 28: Under Wisconsin law, which type of deed provides the LEAST protection to the buyer?

Bargain and sale deed
Special warranty deed
Quitclaim deed (Correct answer)
General warranty deed

Correct answer: Quitclaim deed

A quitclaim deed transfers only whatever interest the grantor may have, with no warranties or guarantees of title.

Question 29: What is an easement in Wisconsin real estate law?

A requirement to sell a property
A right to use another's land for a specific purpose (Correct answer)
A restriction against property improvements
A zoning regulation for commercial buildings

Correct answer: A right to use another's land for a specific purpose

In Wisconsin real estate law, an easement is a legal right that allows one party to use another person's land for a specific, limited purpose. This right does not grant ownership but typically involves access, utility lines, or shared driveways. Easements are usually recorded and run with the land, affecting future property owners.

Question 30: Within what timeframe must an applicant typically apply for the license after passing the exam?

Within 6 months
Within 1 year (Correct answer)
Within 30 days
There is no deadline

Correct answer: Within 1 year

Applicants generally must apply for the license within one year of passing the examination.

Question 31: A seller provides a completed Real Estate Condition Report (RECR) to their listing agent. The agent, during a visual inspection, notices a large water stain on the ceiling that was not disclosed on the RECR. What is the agent's responsibility?

Recommend the seller paint over the stain before showing the property.
Ask the seller about the stain and amend the RECR on their behalf.
Ignore the stain, as the seller is solely responsible for the accuracy of the RECR.
Disclose the observation of the stain as a potential material adverse fact to all parties, regardless of what the RECR states. (Correct answer)

Correct answer: Disclose the observation of the stain as a potential material adverse fact to all parties, regardless of what the RECR states.

Under Wis. Admin. Code § REEB 24.07, a licensee has a duty to conduct a reasonably competent and diligent inspection of accessible areas of a property and to disclose any observed, material adverse facts. This duty exists independently of the seller's disclosures on the RECR. If the licensee observes something that contradicts or is not on the RECR, they have a duty to disclose it to all parties.

Question 32: Which appraisal approach is most suitable and heavily relied upon for valuing a 15-year-old single-family residence located in a well-established residential subdivision in Wisconsin?

Cost Approach
Income Approach
Gross Rent Multiplier Method
Sales Comparison Approach (Correct answer)

Correct answer: Sales Comparison Approach

The Sales Comparison Approach is the most reliable and common method for appraising residential properties, especially in areas with ample sales data. This approach is based on the principle of substitution, comparing the subject property to similar, recently sold properties to determine its value. The Cost Approach is better for new or unique properties, and the Income Approach is used for income-generating properties.

Question 33: Which government power allows Wisconsin to take private property for public use with just compensation?

Taxation
Escheat
Eminent domain (Correct answer)
Police power

Correct answer: Eminent domain

Eminent domain permits the government to condemn private property for public use, provided the owner receives just compensation.

Question 34: The income approach is primarily used to value:

Income-producing rental properties (Correct answer)
Raw undeveloped land
New custom homes
Single-family owner-occupied homes

Correct answer: Income-producing rental properties

The income approach values properties based on the income they generate, ideal for rentals and commercial buildings.

Question 35: A remedy the Wisconsin Equal Rights Division may order after finding discrimination includes:

No remedy is available
Criminal imprisonment
License suspension only
Actual damages and a civil penalty (Correct answer)

Correct answer: Actual damages and a civil penalty

The Division can award actual damages and impose civil penalties for violations.

Question 36: In Wisconsin, which type of co-ownership automatically includes the right of survivorship?

Joint tenancy (Correct answer)
Tenancy at will
Tenancy in common
Community property

Correct answer: Joint tenancy

Joint tenancy in Wisconsin includes the right of survivorship, meaning a deceased co-owner's share passes directly to the surviving co-owner(s).

Question 37: What is the primary purpose of private mortgage insurance (PMI) in a conventional Wisconsin real estate loan?

To protect the lender against borrower default when the down payment is less than 20% (Correct answer)
To protect the borrower from interest rate increases
To guarantee the buyer will qualify for a future refinance
To insure the property against physical damage

Correct answer: To protect the lender against borrower default when the down payment is less than 20%

PMI protects the lender from loss if the borrower defaults, and is typically required when the LTV exceeds 80%.

Question 38: A licensee refuses to show a wheelchair-using buyer accessible homes, assuming they can't afford them. This violates fair housing based on:

Age
Religion
Disability (Correct answer)
Sex

Correct answer: Disability

Making assumptions and limiting choices based on a wheelchair user's abilities is disability discrimination.

Question 39: During a Wisconsin closing, what document itemizes the final costs and credits for buyer and seller in a financed residential deal?

The warranty deed
The listing agreement
The Closing Disclosure (Correct answer)
The Real Estate Condition Report

Correct answer: The Closing Disclosure

The Closing Disclosure itemizes final loan terms, closing costs, and credits for federally regulated residential mortgage transactions.

Question 40: What is the purpose of Wisconsin's Fair Housing Law?

Mandate all homes be owner-occupied
Eliminate zoning laws
Increase property values in select areas
Prevent discrimination in housing transactions (Correct answer)

Correct answer: Prevent discrimination in housing transactions

The primary purpose of Wisconsin's Fair Housing Law is to prevent discrimination in housing transactions. This law prohibits discrimination based on protected characteristics such as race, color, religion, sex, national origin, disability, and familial status. It ensures equal housing opportunities for all individuals in sales, rentals, and financing, promoting fairness and preventing unfair practices.

Question 41: A seller who finances the buyer's purchase directly by taking back a note is providing a:

Wraparound bridge loan
Reverse mortgage
Purchase-money mortgage (Correct answer)
Package mortgage

Correct answer: Purchase-money mortgage

A purchase-money mortgage is seller financing where the seller extends credit to the buyer.

Question 42: Which practice violates Wisconsin advertising rules for licensees?

Advertising a property under the salesperson's name only without the broker (Correct answer)
Including a photo of the home
Including the firm's name in an ad
Listing the property price

Correct answer: Advertising a property under the salesperson's name only without the broker

Advertising must include the employing broker's firm name; a salesperson cannot advertise independently.

Question 43: Before a Wisconsin salesperson license can be activated, what must the licensee do?

Complete 10 additional hours of post-license education
Affiliate with a licensed Wisconsin broker (Correct answer)
Pay a separate activation fee to DSPS
File a surety bond with the state

Correct answer: Affiliate with a licensed Wisconsin broker

A Wisconsin salesperson license is not active until the licensee is affiliated with and sponsored by a licensed Wisconsin broker.

Question 44: A property generates $24,000 net operating income and the market cap rate is 8%. What is its estimated value?

$267,000
$480,000
$300,000 (Correct answer)
$192,000

Correct answer: $300,000

Value equals NOI divided by cap rate: $24,000 / 0.08 = $300,000.

Question 45: What must an applicant submit as part of proving eligibility?

A letter from a bank
Two years of tax returns
A completed application with fees and proof of education (Correct answer)
Only a resume

Correct answer: A completed application with fees and proof of education

Applicants must submit a completed application, applicable fees, and proof of completing required education.

Question 46: An occupancy standard limiting a two-bedroom unit to a reasonable number of people is:

Permitted if applied uniformly and reasonably (Correct answer)
Required by federal law to be one per bedroom
Only allowed for seniors
Always illegal familial discrimination

Correct answer: Permitted if applied uniformly and reasonably

Reasonable, uniformly applied occupancy limits are permitted and are not familial-status discrimination.

Question 47: Which of the following is TRUE about the rescission period for a Wisconsin residential real estate contract?

The buyer has a 3-day rescission period after receiving the condition report
There is no statutory rescission period in Wisconsin
The seller may rescind within 5 days of acceptance
The buyer has a 2-business-day rescission period after receiving the condition report (Correct answer)

Correct answer: The buyer has a 2-business-day rescission period after receiving the condition report

Wisconsin provides a 2-business-day rescission period after the buyer receives the Real Estate Condition Report.

Question 48: Why is a closing disclosure important in a real estate transaction?

Acts as the property deed
Provides final details on costs and terms (Correct answer)
Removes the need for inspections
Serves as a loan application

Correct answer: Provides final details on costs and terms

The Closing Disclosure is a five-page form that provides final details about the mortgage loan you have selected. It outlines all the costs associated with the transaction, including loan terms, projected monthly payments, and closing costs, allowing the buyer to compare them with the Loan Estimate and understand exactly what they are paying. This document ensures transparency and helps prevent surprises at the closing table.

Question 49: In a Wisconsin real estate transaction, when must a seller provide the Real Estate Condition Report to the buyer?

Within 10 days after acceptance
Before acceptance of the offer (Correct answer)
At the time of closing
Before the buyer makes an offer

Correct answer: Before acceptance of the offer

Wisconsin Statute 709.02 requires the seller to furnish the condition report before acceptance of a contract of sale.

Question 50: Does Wisconsin place a limit on how many CE hours can be completed through online courses?

Yes, only the elective hours may be completed online
No, all 18 hours may be completed online (Correct answer)
Yes, only 9 hours may be completed online
Yes, only 6 hours may be completed online

Correct answer: No, all 18 hours may be completed online

Wisconsin does not restrict the number of CE hours completed online; all 18 required hours may be taken through DSPS-approved online providers.

Question 51: In Wisconsin, a listing broker who cooperates with a buyer's broker through the MLS is generally offering what type of relationship to the buyer's broker?

Subagency
Automatic fiduciary representation
Dual agency
Cooperative compensation without subagency (Correct answer)

Correct answer: Cooperative compensation without subagency

Modern MLS practice in Wisconsin typically offers cooperative compensation to a buyer's broker without creating a subagency relationship.

Question 52: A property manager in Wisconsin applies different security deposit requirements based on a tenant's national origin. Which law does this most directly violate?

Both the federal Fair Housing Act and Wisconsin's Open Housing Law (Correct answer)
Only the federal Fair Housing Act
Neither, as security deposits are not covered by fair housing laws
Only Wisconsin's Open Housing Law

Correct answer: Both the federal Fair Housing Act and Wisconsin's Open Housing Law

Applying different terms and conditions, including security deposits, based on national origin violates both federal and state fair housing protections.

Question 53: The Wisconsin Real Estate Examining Board is responsible for:

Collecting property taxes
Establishing licensing standards and disciplinary rules for licensees (Correct answer)
Approving home loans
Setting mortgage interest rates

Correct answer: Establishing licensing standards and disciplinary rules for licensees

The Real Estate Examining Board sets licensing standards and handles disciplinary matters for licensees.

Question 54: A licensee fails to present a low offer because they assume the seller will reject it. This violates the duty of:

Disclosure of defects
Accounting
Loyalty and to present all offers (Correct answer)
Confidentiality

Correct answer: Loyalty and to present all offers

Licensees must present all written offers to the client and cannot decide for them.

Question 55: A landlord refuses to allow a tenant with a disability to install a wheelchair ramp at the tenant's own expense. This most likely violates the requirement to allow:

Rent control
Reasonable modifications (Correct answer)
Just cause eviction
Reasonable accommodations

Correct answer: Reasonable modifications

Permitting a disabled tenant to make physical changes at their expense is a reasonable modification.

Question 56: An appraiser is valuing a 15-year-old, single-family home in a well-established suburban neighborhood in Wisconsin. Which approach to value would the appraiser most likely give the most weight to?

Income Approach
Gross Rent Multiplier Approach
Cost Approach
Sales Comparison Approach (Correct answer)

Correct answer: Sales Comparison Approach

The Sales Comparison Approach (also known as the market data approach) is the most reliable method for appraising single-family homes. It compares the subject property to similar, recently sold properties in the same area. The Cost Approach is best for new construction or unique properties like schools, and the Income Approach is used for income-generating properties like apartment buildings.

Question 57: In a mortgage, the borrower is called the:

Trustee
Mortgagee
Mortgagor (Correct answer)
Beneficiary

Correct answer: Mortgagor

The mortgagor is the borrower who gives the mortgage; the mortgagee is the lender.

Question 58: Zoning ordinances, building codes, and subdivision regulations are enacted by local governments under which inherent power of the state?

Eminent Domain
Police Power (Correct answer)
Escheat
Taxation

Correct answer: Police Power

Police power is the government's inherent authority to create and enforce regulations to protect the public's health, safety, and general welfare. Land use controls like zoning are a primary application of this power.

Question 59: Under Wisconsin's agency disclosure requirements, when must a licensee provide the agency disclosure form to a prospective buyer?

At the time of closing
Within 5 days of first contact
Only if the buyer requests it
At the first substantive contact or before showing properties (Correct answer)

Correct answer: At the first substantive contact or before showing properties

Wisconsin requires agency disclosure at the first substantive contact with a prospective buyer or before showing properties.

Question 60: What does the inspection contingency on the WB-11 allow the buyer to do after receiving an inspection report?

Demand the seller make all repairs at seller's expense
Only cancel the offer entirely
Negotiate repairs, accept as-is, or cancel within the contingency period (Correct answer)
Automatically reduce the purchase price by repair costs

Correct answer: Negotiate repairs, accept as-is, or cancel within the contingency period

The inspection contingency gives the buyer the option to negotiate repairs, accept the property as-is, or cancel within the contingency timeframe.

Question 61: Which Wisconsin statute governs the formal requirements for transferring real property?

Statute of Frauds (Correct answer)
Uniform Commercial Code
Wisconsin Consumer Act
Wisconsin Fair Dealership Law

Correct answer: Statute of Frauds

The Statute of Frauds requires real property transfers to be in writing and signed by the party to be charged.

Question 62: An individual has been openly, continuously, and without permission, using a neighbor's driveway to access a back portion of their property for the past 22 years. In Wisconsin, this person may be able to claim what type of interest in the neighbor's property?

Prescriptive easement (Correct answer)
License
Fee simple determinable
Easement by necessity

Correct answer: Prescriptive easement

A prescriptive easement in Wisconsin can be established through adverse use that is hostile, visible, open, continuous, and uninterrupted for a period of at least 20 years. The scenario describes a use that meets these criteria, allowing the individual to potentially claim a legal right to continue using the driveway. An easement by necessity requires proof of a landlocked parcel from a common grantor. A license is a revocable permission, which was not given here.

Question 63: In Wisconsin, what happens if a licensee fails to provide the mandatory agency disclosure form?

The buyer receives an automatic price reduction
Nothing, it is only a recommended practice
The licensee may face disciplinary action from DSPS (Correct answer)
The transaction is automatically void

Correct answer: The licensee may face disciplinary action from DSPS

Failure to provide the required agency disclosure can result in disciplinary action by the Wisconsin Department of Safety and Professional Services.

Question 64: In the cost approach, what is subtracted from the cost of improvements?

Closing costs
Accrued depreciation (Correct answer)
The land value
Market interest

Correct answer: Accrued depreciation

The cost approach subtracts accrued depreciation from reproduction/replacement cost, then adds land value.

Question 65: For a business entity (like an LLC) to hold a Wisconsin real estate license, it generally must:

Only register with the IRS
Have no licensed individuals
Be represented by a licensed broker of record (Correct answer)
Have at least 50 employees

Correct answer: Be represented by a licensed broker of record

A licensed business entity must operate under a qualifying licensed broker acting as broker of record.

Question 66: What must a Wisconsin salesperson applicant do after passing the licensing exam?

Wait 90 days before activating the license
Affiliate with a licensed Wisconsin broker (Correct answer)
Complete an additional 20 hours of training
Immediately begin practicing independently

Correct answer: Affiliate with a licensed Wisconsin broker

After passing the exam, a salesperson must affiliate with a licensed Wisconsin broker before engaging in real estate activities.

Question 67: In Wisconsin, unpaid property taxes create what kind of lien priority?

Lowest priority lien
Equal priority with mortgages
No lien at all
A lien superior to most other liens (Correct answer)

Correct answer: A lien superior to most other liens

Property tax liens generally take priority over most other liens, including mortgages, in Wisconsin.

Question 68: How long is a Wisconsin real estate salesperson license valid before renewal is required?

1 year
2 years (Correct answer)
3 years
4 years

Correct answer: 2 years

Wisconsin real estate licenses must be renewed every two years on an even-year cycle.

Question 69: A licensee is using a WB-44 Counter-Offer. The seller's first counter-offer (Counter-Offer #1) is rejected by the buyer, who then submits their own counter-offer. How should the buyer's counter-offer be numbered?

Counter-Offer #1A
Counter-Offer #2 (Correct answer)
Counter-Offer #1 by Buyer
It does not need to be numbered.

Correct answer: Counter-Offer #2

Counter-offers in a Wisconsin transaction should be numbered sequentially, regardless of which party is making the counter. If the seller makes the first one, it is #1. The buyer's response would then be Counter-Offer #2.

Question 70: A key advantage of an FHA-insured loan for buyers is:

No credit check
No mortgage insurance
Guaranteed 0% interest
A lower required down payment (Correct answer)

Correct answer: A lower required down payment

FHA loans allow low down payments (as little as 3.5%), making homeownership more accessible.

Question 71: A Wisconsin licensee accepts a referral fee from a home inspector without telling the client. This is:

An undisclosed conflict of interest violation (Correct answer)
Standard practice
Only a problem if the fee is large
Acceptable if the inspector is licensed

Correct answer: An undisclosed conflict of interest violation

Accepting undisclosed compensation that creates a conflict of interest violates the duty of disclosure.

Question 72: In a Wisconsin real estate transaction, when can earnest money held by the listing broker's trust account be disbursed if there is a dispute between buyer and seller?

Only upon written agreement of both parties or a court order (Correct answer)
Automatically to the buyer if the seller breaches
At the listing broker's sole discretion after 30 days
Upon the seller's written demand after closing date passes

Correct answer: Only upon written agreement of both parties or a court order

Disputed earnest money in a broker's trust account can only be disbursed with written consent of both parties or by court order under Wisconsin law.

Question 73: Even where an exemption applies, which prohibition of the federal Fair Housing Act still always applies?

The right to a mortgage
Rent control
The ban on discriminatory advertising (Correct answer)
Property tax caps

Correct answer: The ban on discriminatory advertising

Discriminatory advertising is prohibited in all cases, regardless of other exemptions.

Question 74: A Wisconsin real estate agent acting as a transaction broker owes which of the following to both parties?

Full fiduciary duties including undivided loyalty
No duties whatsoever
Limited duties including honesty, fairness, and disclosure of material facts (Correct answer)
Only the duty to show up at closing

Correct answer: Limited duties including honesty, fairness, and disclosure of material facts

A transaction broker in Wisconsin owes limited duties of honesty, fairness, and disclosure of material adverse facts to both parties.

Question 75: Which of the following is required for a valid deed transfer in Wisconsin?

Notarization by two witnesses
Delivery and acceptance of the deed (Correct answer)
Recording at the Register of Deeds office
Consideration of at least one dollar

Correct answer: Delivery and acceptance of the deed

A deed must be delivered by the grantor and accepted by the grantee to effectively transfer ownership.

Question 76: An investment property generates $36,000 in annual net operating income and is valued at $400,000. What is the capitalization rate?

8%
9% (Correct answer)
10%
11%

Correct answer: 9%

Cap rate = NOI ÷ value: $36,000 ÷ $400,000 = 0.09 or 9%.

Question 77: On the WB-11 Residential Offer to Purchase, which contingency allows the buyer to cancel if they cannot obtain financing approval?

Appraisal contingency
Inspection contingency
Financing commitment contingency (Correct answer)
Title contingency

Correct answer: Financing commitment contingency

The financing commitment contingency on the WB-11 permits the buyer to cancel if they cannot secure a loan commitment by the specified date.

Question 78: In Wisconsin, the WB-44 Counter-Proposal form is used when a seller wants to change terms of a buyer's offer. What happens to the original offer when a counter-proposal is issued?

The original offer must be returned to the buyer unsigned
The original offer is suspended for 72 hours
The original offer remains valid alongside the counter
The original offer is rejected and a new proposal is created (Correct answer)

Correct answer: The original offer is rejected and a new proposal is created

Issuing a WB-44 Counter-Proposal constitutes a rejection of the original offer and creates a new proposal with modified terms.

Question 79: Which of the following contingencies is NOT typically included in a Wisconsin WB-11 offer to purchase?

Neighbor approval contingency (Correct answer)
Financing contingency
Home inspection contingency
Appraisal contingency

Correct answer: Neighbor approval contingency

Neighbor approval is not a standard contingency in any Wisconsin real estate purchase agreement.

Question 80: What does the term 'fiduciary duty' mean in real estate?

A contract to set commission rates
A requirement to disclose all offers
An agreement to guarantee a sale
Obligation to act in a client’s best interest (Correct answer)

Correct answer: Obligation to act in a client’s best interest

Fiduciary duty in real estate refers to the legal and ethical obligation of an agent to act solely in the best interests of their client. This relationship demands utmost loyalty, confidentiality, and care, requiring the agent to prioritize the client's goals and protect their financial and personal information. It ensures the client's trust is upheld throughout the transaction.

Question 81: VA loans are available to eligible:

First-time buyers only
Veterans and active-duty service members (Correct answer)
Investors only
Any U.S. citizen

Correct answer: Veterans and active-duty service members

VA loans are a benefit for qualifying veterans, active-duty members, and certain surviving spouses.

Question 82: Which of the following best describes tenancy by the entirety in Wisconsin?

Ownership by two or more unrelated individuals
Ownership by a married couple with right of survivorship (Correct answer)
Ownership by a business partnership
Ownership held in a living trust

Correct answer: Ownership by a married couple with right of survivorship

Tenancy by the entirety is a form of co-ownership available only to married couples in Wisconsin, featuring an automatic right of survivorship.

Question 83: A buyer pays 2 discount points on a $180,000 mortgage loan. How much are the points?

$3,600 (Correct answer)
$5,400
$1,800
$2,700

Correct answer: $3,600

One point equals 1% of the loan amount; 2 points = 2% × $180,000 = $3,600.

Question 84: A city planning commission is reviewing a new housing development proposal. To separate the proposed high-density residential area from an existing industrial park, the plan includes a park with extensive landscaping. This separating strip of land is best known as what?

A setback area
A buffer zone
A nonconforming use area (Correct answer)
An easement by necessity

Correct answer: A nonconforming use area

A buffer zone is a strip of land, often used for landscaping, parks, or open space, that is intentionally created to separate and screen one land use from another, such as separating a residential zone from a commercial or industrial zone, to minimize conflicts.

Question 85: A Wisconsin licensee wants to place a sign on a listed property. Ethically and legally, they must first obtain:

The seller/owner's permission (Correct answer)
City council approval
MLS approval
Buyer consent

Correct answer: The seller/owner's permission

A licensee must have the owner's permission before placing a sign on the property.

Question 86: In Wisconsin, when must a broker deliver the accepted offer to purchase to all parties?

Immediately upon acceptance
Within 48 hours
Within 24 hours
Within one business day of acceptance (Correct answer)

Correct answer: Within one business day of acceptance

Wisconsin administrative code requires brokers to deliver copies of the accepted offer to all parties within one business day of acceptance.

Question 87: If a buyer receives the RECR after signing the offer and finds a disclosed defect they object to, the buyer may:

Demand a new report
Only sue after closing
Rescind within the time allowed by the offer (Correct answer)
Never rescind

Correct answer: Rescind within the time allowed by the offer

Receiving the report after acceptance can trigger a rescission right within the timeframe stated in the offer.

Question 88: If a Wisconsin licensee acts as a dual agent without obtaining written consent from both parties, what is the most likely consequence?

The transaction is valid but the agent receives a warning letter
The licensee may face license suspension or revocation and the transaction may be voidable (Correct answer)
The commission is automatically forfeited to the state
Both parties must renegotiate the purchase price

Correct answer: The licensee may face license suspension or revocation and the transaction may be voidable

Undisclosed dual agency violates Wisconsin law and can result in disciplinary action including license suspension or revocation, and the affected party may seek to void the transaction.

Question 89: What is the purpose of the WB-40 Amendment to Offer form in Wisconsin?

To extend the listing agreement
To transfer earnest money to the seller
To cancel an existing offer
To modify terms of an accepted offer (Correct answer)

Correct answer: To modify terms of an accepted offer

The WB-40 is used to modify or change the terms of an already-accepted offer to purchase with mutual consent.

Question 90: A licensee who fails to disclose a required agency relationship in Wisconsin may face:

Only a client complaint letter
Disciplinary action by the licensing authority (Correct answer)
Automatic license upgrade
No consequences

Correct answer: Disciplinary action by the licensing authority

Failing to make required agency disclosures can lead to disciplinary action against the license.

Question 91: A married couple in Wisconsin acquires a home after their marriage. Under Wisconsin's Marital Property Act, how is this property generally classified, assuming there is no marital property agreement to the contrary?

Separate property of the spouse whose name is on the title.
Marital property. (Correct answer)
Individual property.
Joint tenancy with right of survivorship.

Correct answer: Marital property.

Wisconsin is a community property state, referred to as marital property. The Marital Property Act presumes that all property acquired by either spouse during the marriage is marital property, with each spouse having an undivided one-half interest. This is true regardless of how the property is titled. While it can be titled as survivorship marital property, the fundamental classification is 'marital property'.

Question 92: The ratio comparing a loan amount to the property's appraised value is the:

Debt-to-income ratio
Capitalization rate
Gross rent multiplier
Loan-to-value (LTV) ratio (Correct answer)

Correct answer: Loan-to-value (LTV) ratio

The loan-to-value ratio measures the loan amount as a percentage of the property's value.

Question 93: Under Wisconsin law, what is the primary purpose of a property appraisal in a real estate transaction?

To set the listing price for the seller
To calculate the buyer's closing costs
To establish an opinion of market value for the lender (Correct answer)
To determine the property tax assessment

Correct answer: To establish an opinion of market value for the lender

The primary purpose of an appraisal in a real estate transaction is to provide the lender with an independent opinion of the property's market value to protect their investment.

Question 94: What is the statute of limitations for filing a fair housing complaint with the Wisconsin Equal Rights Division?

Six months from the date of the alleged discriminatory act
90 days from the date of the alleged discriminatory act
One year from the date of the alleged discriminatory act (Correct answer)
Two years from the date of the alleged discriminatory act

Correct answer: One year from the date of the alleged discriminatory act

In Wisconsin, a complainant has one year from the date of the alleged discriminatory act to file a fair housing complaint with the Equal Rights Division.

Question 95: Which Wisconsin agency issues real estate salesperson and broker licenses?

Department of Financial Institutions
Real Estate Commission of the U.S.
Department of Safety and Professional Services (DSPS) (Correct answer)
Department of Revenue

Correct answer: Department of Safety and Professional Services (DSPS)

The Wisconsin Department of Safety and Professional Services (DSPS) regulates and issues real estate licenses.

Question 96: If a licensee is uncertain whether a fact is a material adverse fact, the safest practice is to:

Ask the seller to hide it
Disclose it and let the party evaluate (Correct answer)
Say nothing
Consult the MLS rules only

Correct answer: Disclose it and let the party evaluate

When in doubt, disclosing the fact protects both the parties and the licensee.

Question 97: Which agency enforces the Wisconsin Open Housing Law?

Real Estate Examining Board
Department of Justice
Department of Workforce Development, Equal Rights Division (Correct answer)
Department of Safety and Professional Services

Correct answer: Department of Workforce Development, Equal Rights Division

The Equal Rights Division of the Department of Workforce Development investigates state fair housing complaints.

Question 98: Monthly rent is $1,500, paid on the 1st. The closing occurs on the 16th of the month and the seller has collected the full month's rent. Using a 30-day month, how much rent must the seller credit to the buyer at closing?

$800
$650
$500
$750 (Correct answer)

Correct answer: $750

The buyer owns days 16–30 = 15 days; daily rent = $1,500 ÷ 30 = $50; 15 × $50 = $750 credit.

Question 99: When an assessor in Wisconsin is determining the value of a property for tax purposes, which of the following is considered the BEST evidence of the property's value according to state guidelines?

A recent, arm's-length sale of the property itself. (Correct answer)
The cost to replace the structure, minus depreciation.
The property's potential to generate rental income.
The average sale price of homes in the same zip code.

Correct answer: A recent, arm's-length sale of the property itself.

Wisconsin statutes and the Wisconsin Property Assessment Manual state that a recent, arm's-length sale of the subject property is the best indicator of its full market value. If such a sale hasn't occurred, the next best information is recent arm's-length sales of reasonably comparable properties. Other methods are used only when sales data is insufficient.

Question 100: A property owner in a residential-zoned area has operated a small convenience store for 30 years. The city recently rezoned the entire area to be exclusively residential. The store is now considered a 'grandfathered' use. What is the official term for the store's status, and what happens if the owner closes the business for more than 12 consecutive months?

Variance; the status is permanent and cannot be revoked.
Permitted use by exception; the owner can reopen at any time.
Conditional use; the owner must reapply for a permit to reopen.
Nonconforming use; the right to operate the store may be terminated. (Correct answer)

Correct answer: Nonconforming use; the right to operate the store may be terminated.

The store is a legal nonconforming use because it was lawfully established before the new zoning ordinance made it non-compliant. Under Wisconsin statutes, if a nonconforming use is discontinued for a period of 12 consecutive months, the right to continue that use is typically lost, and any future use must conform to the current zoning regulations.

Question 101: A Wisconsin licensee's duty of loyalty means the licensee must:

Prioritize their own commission
Ignore the client's instructions
Place the client's interests above the licensee's own interests (Correct answer)
Serve the other party's interests first

Correct answer: Place the client's interests above the licensee's own interests

The duty of loyalty requires putting the client's interests ahead of the licensee's own personal interests.

Question 102: An applicant who completed pre-licensing education many years ago may need to:

Verify the education still meets current approval and recency rules (Correct answer)
Retake the entire broker course
Nothing, education never expires
Obtain a federal waiver

Correct answer: Verify the education still meets current approval and recency rules

Education must meet current approval standards, and older coursework may need to satisfy recency requirements.

Question 103: A clause that allows the lender to demand full payment if the borrower defaults is the:

Defeasance clause
Subordination clause
Acceleration clause (Correct answer)
Alienation clause

Correct answer: Acceleration clause

The acceleration clause lets the lender call the entire balance due upon default.

Question 104: Which of the following activities requires a Wisconsin real estate license?

Managing your own rental properties
Referring a friend to a licensed agent with no compensation received
Negotiating the sale of real property for another person for compensation (Correct answer)
Selling your own personal residence

Correct answer: Negotiating the sale of real property for another person for compensation

Acting on behalf of another person to negotiate a real estate transaction in exchange for compensation requires a Wisconsin real estate license.

Question 105: When a Wisconsin salesperson changes their employing broker, how many days do they have to notify DSPS?

10 days (Correct answer)
5 days
60 days
30 days

Correct answer: 10 days

Wisconsin licensees must notify DSPS within 10 days of changing their employing broker to keep licensing records current.

Question 106: A Wisconsin real estate licensee is drafting a WB-11 Residential Offer to Purchase for a buyer client. The buyer wants to include a provision that is not covered in the standard approved form. According to Wis. Admin. Code § REEB 16, what is the proper procedure for the licensee to add this provision?

Use a separate, non-approved form that contains the desired provision.
Advise the buyer that no changes or additions can be made to state-approved forms.
Write the provision in the blank space under 'Additional Provisions' or attach a separate addendum. (Correct answer)
Modify a pre-printed clause by crossing it out and writing the new provision next to it.

Correct answer: Write the provision in the blank space under 'Additional Provisions' or attach a separate addendum.

Wisconsin Administrative Code § REEB 16 allows licensees to add provisions to approved forms by either filling in the blank lines provided (such as in the 'Additional Provisions' section) or by attaching a pre-prepared addendum. The addendum must be incorporated by reference into the approved form.

Question 107: Marital status is a protected class in Wisconsin housing. Which action would violate this?

Refusing to rent to an unmarried couple (Correct answer)
Requiring proof of income
Requiring a security deposit
Running a background check

Correct answer: Refusing to rent to an unmarried couple

Denying housing because applicants are unmarried violates the marital status protection.

Question 108: Which principle holds that a property's maximum value is set by the cost of acquiring an equally desirable substitute?

Principle of conformity
Principle of anticipation
Principle of contribution
Principle of substitution (Correct answer)

Correct answer: Principle of substitution

The principle of substitution states a buyer will pay no more than the cost of an equally desirable substitute.

Question 109: What does the acronym 'REEB' stand for in Wisconsin real estate regulation?

Real Estate Enforcement Bureau
Real Estate Examining Board (Correct answer)
Real Estate Ethics Board
Real Estate Education Bureau

Correct answer: Real Estate Examining Board

REEB stands for the Real Estate Examining Board, the Wisconsin body that sets licensure standards and professional conduct requirements.

Question 110: The Wisconsin agency that regulates real estate licensees is the:

HUD Regional Office
Department of Safety and Professional Services (DSPS) (Correct answer)
Consumer Financial Protection Bureau
Department of Justice

Correct answer: Department of Safety and Professional Services (DSPS)

The Wisconsin DSPS, through the Real Estate Examining Board, regulates licensees.

Question 111: In Wisconsin, what is the maximum security deposit a landlord may collect for a residential rental property?

One month's rent
Two months' rent
Three months' rent
There is no statutory limit (Correct answer)

Correct answer: There is no statutory limit

Wisconsin does not impose a statutory cap on the amount a landlord may charge as a security deposit for residential properties.

Question 112: A licensee is asked to draft a complex addendum outside standard approved forms. The ethical action is to:

Draft any legal language requested
Refuse to help at all
Copy language from another contract
Advise the client to consult an attorney for legal drafting (Correct answer)

Correct answer: Advise the client to consult an attorney for legal drafting

Drafting original legal language is the practice of law, so licensees should refer clients to an attorney.

Question 113: In Wisconsin, which type of property ownership automatically includes the right of survivorship between spouses?

Tenancy in common
Survivorship marital property (Correct answer)
Sole ownership
Joint tenancy with a business partner

Correct answer: Survivorship marital property

Wisconsin's marital property law allows spouses to hold survivorship marital property, which passes automatically to the surviving spouse.

Question 114: A mortgage lender in Wisconsin offers less favorable loan terms to applicants from a predominantly Hispanic neighborhood. This practice is known as what?

Price fixing
Redlining (Correct answer)
Steering
Blockbusting

Correct answer: Redlining

Redlining is the illegal practice of denying or limiting financial services to residents of certain neighborhoods based on racial or ethnic composition.

Question 115: In a Wisconsin real estate transaction, 'delivery' of an accepted offer occurs when:

the accepted document is physically received by the other party or their designated agent. (Correct answer)
the accepting party signs the document.
the accepted document is put in the mail by the accepting party's agent.
the sending party's agent calls the other agent to inform them of the acceptance.

Correct answer: the accepted document is physically received by the other party or their designated agent.

In Wisconsin contracts, 'delivery' is a critical concept that creates a binding contract. It is not complete when a party signs or even when a document is sent. Binding acceptance occurs upon receipt of the accepted offer by the party who made the offer (or their agent), according to the delivery methods specified in the contract.

Question 116: A property has NOI of $20,000 and a cap rate of 10%. Its estimated value is:

$20,000
$200,000 (Correct answer)
$100,000
$2,000,000

Correct answer: $200,000

Value = NOI / Cap Rate = $20,000 / 0.10 = $200,000.

Question 117: Which of the following is generally NOT considered a material adverse fact requiring disclosure in Wisconsin?

Active mold contamination
The fact a prior occupant died of natural causes (Correct answer)
A cracked foundation
A leaking, damaged roof

Correct answer: The fact a prior occupant died of natural causes

Wisconsin does not treat the mere fact of a natural-cause death on a property as a material adverse fact.

Question 118: A seller wants to net $250,000 after paying a 6% commission. What must the sale price be?

$265,957 (Correct answer)
$265,000
$275,000
$266,000

Correct answer: $265,957

Sale price = desired net ÷ (1 − commission rate): $250,000 ÷ 0.94 = $265,957.

Question 119: If a Wisconsin licensee's client instructs them to conceal a known structural defect, the licensee must:

Ask the buyer to inspect harder
Refuse and disclose the material adverse fact (Correct answer)
Withdraw only if paid
Follow the client's lawful instruction

Correct answer: Refuse and disclose the material adverse fact

The duty to disclose material adverse facts overrides a client instruction to conceal them.

Question 120: A real estate agent in Wisconsin receives a request from a buyer to only show homes in neighborhoods with a specific racial composition. What should the agent do?

Refuse the request and explain fair housing laws (Correct answer)
Refer the buyer to another agent who will comply
Show only a few homes in those areas
Comply since the buyer is the client

Correct answer: Refuse the request and explain fair housing laws

Steering buyers toward or away from neighborhoods based on race violates both federal and Wisconsin fair housing laws, and the agent must refuse.

Question 121: Which Wisconsin state agency is primarily responsible for enforcing the state's fair housing laws?

Department of Safety and Professional Services
Department of Administration
Office of the Attorney General
Department of Workforce Development, Equal Rights Division (Correct answer)

Correct answer: Department of Workforce Development, Equal Rights Division

The Equal Rights Division within the Wisconsin Department of Workforce Development handles fair housing complaints and enforcement at the state level.

Question 122: Which best describes a licensee's duty of accounting in Wisconsin?

Auditing the buyer's finances
Estimating property value
Promptly accounting for all money and property received on the client's behalf (Correct answer)
Preparing the client's taxes

Correct answer: Promptly accounting for all money and property received on the client's behalf

The duty of accounting requires promptly reporting and handling all funds and documents belonging to the client.

Question 123: What is the primary responsibility of a real estate agent under ethical guidelines?

Maximize commission earnings
Disclose client information freely
Only follow client instructions without guidance
Act in the best interest of clients (Correct answer)

Correct answer: Act in the best interest of clients

Under ethical guidelines, a real estate agent's primary responsibility is to act as a fiduciary for their clients, meaning they must prioritize the client's best interests above all else. This includes duties such as loyalty, confidentiality, obedience, disclosure, accounting, and reasonable care. Maximizing commission or disclosing client information freely would violate this fundamental ethical obligation.

Question 124: Which of the following would disqualify someone from Wisconsin real estate licensure?

Not having a high school diploma
Having previously held a license in another state
Being over 65 years old
Providing false information on the license application (Correct answer)

Correct answer: Providing false information on the license application

Providing false or misleading information on a license application is grounds for denial of a Wisconsin real estate license.

Question 125: In Wisconsin, which document is used to remove a cloud on title caused by a paid-off mortgage?

Quitclaim deed
Satisfaction of mortgage (Correct answer)
Abstract of title
Lis pendens

Correct answer: Satisfaction of mortgage

A satisfaction of mortgage is recorded to publicly show that the mortgage debt has been fully paid and the lien is released.

Question 126: What must a Wisconsin broker do with earnest money received from a buyer?

Give it directly to the seller immediately
Keep it as cash until closing
Hold it in the broker's trust account by the required deadline (Correct answer)
Deposit it into the broker's personal account

Correct answer: Hold it in the broker's trust account by the required deadline

Earnest money must be placed in the broker's trust account within the timeframe set by law.

Question 127: In the sales comparison approach, adjustments are always made to which property?

The subject property
The comparable properties (Correct answer)
Both equally
Whichever sold most recently

Correct answer: The comparable properties

Adjustments are made to the comparable sales, never to the subject property, to make them equivalent to the subject.

Question 128: Under Wisconsin's agency law, which type of agency allows a broker to represent both the buyer and seller in the same transaction?

Dual agency with informed consent (Correct answer)
Implied agency
Designated agency
Single agency

Correct answer: Dual agency with informed consent

Dual agency is permitted in Wisconsin only when both parties give informed written consent.

Question 129: What happens if a buyer fails to meet the terms of a purchase contract?

Automatically receive a refund
Have the contract extended indefinitely
Gain automatic financing approval
Forfeit earnest money or face legal action (Correct answer)

Correct answer: Forfeit earnest money or face legal action

If a buyer fails to uphold their contractual obligations without a valid contingency, they risk losing their earnest money deposit to the seller as liquidated damages. Depending on the contract terms and the severity of the breach, the seller may also pursue further legal action, such as specific performance, to compel the buyer to complete the purchase or seek additional damages.

Question 130: In Wisconsin, when a person dies without a will and no heirs can be found, the property passes to the state through:

Condemnation
Partition
Escheat (Correct answer)
Adverse possession

Correct answer: Escheat

Escheat is the process by which property reverts to the state when an owner dies intestate with no locatable heirs.

Question 131: In Wisconsin, before land can be subdivided into multiple lots for sale, the developer usually must record a:

Title abstract
Deed of trust
Land contract
Certified survey map or plat (Correct answer)

Correct answer: Certified survey map or plat

Wisconsin subdivision law requires recording a plat or certified survey map to legally divide land into parcels.

Question 132: Under the familial status protection, which practice is generally prohibited in Wisconsin?

Requiring renter's insurance
Refusing to rent to a family with children (Correct answer)
Setting quiet hours
Charging late fees

Correct answer: Refusing to rent to a family with children

Denying housing to families with children under 18 violates familial status protection.

Question 133: In a Wisconsin commercial real estate transaction, which approved form is used instead of the WB-11?

WB-12 Commercial Listing Contract
WB-13 Commercial Offer to Purchase
WB-15 Commercial Offer to Purchase
WB-14 Commercial Offer to Purchase (Correct answer)

Correct answer: WB-14 Commercial Offer to Purchase

The WB-14 is the approved form for commercial offers to purchase in Wisconsin, distinct from the residential WB-11.

Question 134: What is the minimum age requirement to obtain a Wisconsin real estate license?

21 years old
25 years old
18 years old (Correct answer)
16 years old

Correct answer: 18 years old

In Wisconsin, the minimum age requirement to obtain a real estate license is 18 years old. This age requirement ensures that individuals are considered legal adults, capable of entering into contracts and understanding the significant legal and financial responsibilities associated with real estate transactions. It aligns with the general age of majority for professional licensure.

Question 135: A licensee is working with a buyer who has young children. The licensee focuses the property search on neighborhoods with many families and near schools, while deliberately avoiding showing properties in a quiet, nearby subdivision primarily occupied by retirees. This is an example of what illegal practice?

Blockbusting
Puffing
Steering (Correct answer)
Redlining

Correct answer: Steering

Steering is the illegal practice of guiding prospective buyers towards or away from certain neighborhoods based on a protected class. In this case, the licensee is making housing choices for the buyer based on their familial status, which is a violation of the Fair Housing Act.

Question 136: Commingling in Wisconsin real estate practice refers to:

Sharing a commission with a cooperating broker
Advertising multiple properties together
Representing two clients at once
Mixing client trust funds with the broker's own funds (Correct answer)

Correct answer: Mixing client trust funds with the broker's own funds

Commingling is improperly mixing client trust funds with the broker's personal or business funds.

Question 137: Wisconsin's farmland preservation program provides tax credits to landowners who agree to what restriction?

Keeping land in agricultural use and complying with soil conservation standards (Correct answer)
Donating development rights to the state permanently
Converting farmland to residential subdivisions within five years
Allowing public recreational access to their property

Correct answer: Keeping land in agricultural use and complying with soil conservation standards

Wisconsin's farmland preservation program offers tax credits to qualifying landowners who keep their land in agricultural use and follow soil and water conservation standards.

Question 138: Under Wisconsin law, what is the maximum duration of a listing agreement before it must be renewed?

There is no statutory maximum (Correct answer)
6 months
12 months
24 months

Correct answer: There is no statutory maximum

Wisconsin does not impose a statutory maximum duration on listing agreements, though DSPS recommends reasonable timeframes.

Question 139: A Wisconsin licensee who works with a buyer but has no written agency agreement owes that buyer duties as a:

Client
Subagent
Customer (Correct answer)
Fiduciary

Correct answer: Customer

Without a written agency agreement the person is a customer, owed only the statutory broker duties, not full client-level fiduciary duties.

Question 140: Which appraisal approach relies most heavily on recently sold comparable properties to estimate value?

Cost approach
Income approach
Gross rent multiplier approach
Sales comparison approach (Correct answer)

Correct answer: Sales comparison approach

The sales comparison approach values a property by comparing it to similar recently sold properties.

Wisconsin Real Estate License Exam

The Wisconsin Real Estate License Exam exam validates essential knowledge and skills required for certification or licensure in this field.

140

Questions

150 min

Time Limit

75%

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