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Real Estate Massachusetts Real Estate Salesperson Exam Sample Questions (Q134-Q139):

NEW QUESTION # 134
Which of the following activities may result in a fine from the Massachusetts Commission Against Discrimination (MCAD) against a licensee?

A. Knowingly making any substantial misrepresentation
B. Acting in the dual capacity of broker and undisclosed principal in the same transaction
C. Failing to give both the buyer and the seller a copy of the purchase and sales agreement
D. Blockbusting

Answer: D

Explanation:
The Massachusetts Commission Against Discrimination (MCAD) is the state agency responsible for enforcing the Massachusetts Fair Housing Law (M.G.L. c. 151B). Blockbusting is the illegal practice of inducing homeowners to sell by suggesting that protected classes of people (such as minorities, families with children, or people receiving public assistance) are moving into the neighborhood, often suggesting declining property values.
This practice is explicitly prohibited under both federal law (Fair Housing Act) and Massachusetts General Law. MCAD has the authority to investigate complaints of housing discrimination and levy fines against licensees found guilty of such violations.
While misrepresentation or undisclosed dual capacity may lead to disciplinary action by the Massachusetts Board of Registration of Real Estate Brokers and Salespersons, only violations of fair housing law, such as blockbusting, steering, or refusing to deal with members of protected classes, fall under the jurisdiction of MCAD.
Reference: Massachusetts General Laws c. 151B; MCAD Fair Housing Guidelines; 254 CMR 3.00.

NEW QUESTION # 135
An offer of $569,000 is verbally accepted by a seller. Two hours later an offer of $589,000 is presented to the seller, which the seller accepts in writing. Based on the above situation the first buyer is

A. Not entitled to purchase the property.
B. Not entitled to the status as a backup offer.
C. Entitled to an additional offer.
D. Entitled to purchase the property.

Answer: A

Explanation:
Under Massachusetts law and the Statute of Frauds (M.G.L. c. 259), all contracts for the sale of real property must be in writing and signed to be enforceable. A verbal acceptance of an offer does not create a binding real estate contract. Therefore, when the seller verbally accepted the first offer of $569,000, no enforceable agreement was formed.
Later, when the seller accepted the $589,000 offer in writing, that acceptance created the first legally binding contract because it was in writing and signed. The first buyer cannot compel the seller to sell to them, as there was no enforceable written agreement.
Thus, the first buyer is not entitled to purchase the property. Only the second, written offer created enforceable contractual rights.
Reference: Massachusetts General Laws Chapter 259 (Statute of Frauds); Massachusetts Real Estate Candidate Information Bulletin, Section: Contracts.

NEW QUESTION # 136
A licensee must provide disclosure of licensed status when acting as a principal if

A. the licensee has any economic interest in the property.
B. any relative of the licensee has ever lived in the residence.
C. the licensee does not have errors and omission insurance.
D. the agent of the other party asks about this specifically.

Answer: A

Explanation:
Under Massachusetts license law (254 CMR 3.00), a real estate licensee who acts as a principal in a transaction (buyer, seller, lessor, or lessee) must disclose in writing that they are a licensed broker or salesperson if they hold any direct or indirect ownership or economic interest in the property.
This rule is intended to protect the public from potential conflicts of interest and ensure transparency. The disclosure must be made in writing before entering into any binding contract.
Simply being asked (A) is not enough; disclosure is mandatory regardless.
Insurance coverage (B) is irrelevant.
Family members (D) may trigger disclosure if the licensee has an ownership/economic interest, but not merely because they lived there.
Correct answer: C.
Reference: Massachusetts Real Estate Salesperson Candidate Handbook - License Law & Disclosure; 254 CMR 3.00.

NEW QUESTION # 137
A buyer is purchasing a $625,000 property. The lender requires a 20% down payment to avoid mortgage insurance. The buyer provided $5,000 in earnest money. The buyer closing costs are $13,000. What is the amount the buyer must bring to settlement to close the transaction?

A. $133,000
B. $120,000
C. $138,000
D. $143,000

Answer: A

Explanation:
Comprehensive and Detailed Explanation (150-250 words):
First compute the down payment at 20% of $625,000:
Down payment = $625,000 × 0.20 = $125,000.

Mortgage insurance is avoided because the LTV is 80% (loan of $500,000 on $625,000 purchase), consistent with typical underwriting. Massachusetts exam math emphasizes accurate handling of down payment percentages, credits for deposits, and inclusion of buyer's closing costs. The only choice that matches this computation is $133,000.
References: Massachusetts Real Estate Salesperson Candidate Handbook - Real Estate Math (Down payments, buyer credits/debits, cash to close); Financing basics (LTV and PMI thresholds).

NEW QUESTION # 138
Which of the following is used in the cost approach when estimating the value of improvements?

A. The price per square foot of comparable properties.
B. How much it would cost to build a similar building at today's cost.
C. Location, available financing, and depreciation.
D. The assessed value of the property including the land.

Answer: B

Explanation:
The cost approach to value is based on the principle of substitution, which states that a buyer will not pay more for a property than the cost to build a comparable one. In this method, the appraiser estimates the current cost of constructing the improvements using either the replacement cost (cost to build a similar building with modern materials and methods) or the reproduction cost (exact duplicate of the original).
The appraiser then subtracts depreciation (physical deterioration, functional obsolescence, or economic obsolescence) and adds the land value (determined separately). This approach is most often used for special- purpose properties (schools, churches, government buildings) where comparable sales are limited.
The other options are incorrect:
Assessed value (A) is for taxation, not appraisal.
Price per square foot (C) is a sales comparison method.
Location/financing (D) are factors but not a direct step in the cost approach.
Reference: Massachusetts Real Estate Salesperson Candidate Handbook - Appraisal Methods; USPAP Standards.

NEW QUESTION # 139
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