Licensing Practice Questions
Licensing is 4 outline items on the Texas state-law portion. It covers which activities require a license and the exemptions, how a sales agent license is obtained and maintained, background checks, the need for an active sponsoring broker, place of business, and continuing education. Work the questions below, then read every explanation.
Exam prep only
These questions test who must be licensed, what activates a sales agent license, and how it is kept in good standing. The recurring theme is that a sales agent must be sponsored by an active broker to act.
Use the activate-then-maintain read. First confirm what makes a license active, then apply the maintenance rule. Education hours and renewal cycles should be checked against current TREC requirements when applying outside exam practice.
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Licensing Practice Questions
15 scenario-based questions on licensing, scored, each with a full explanation after you answer. Every question is also written out below if you would rather study at your own pace.
Every question explained
Prefer to study at your own pace? Here are all 15 questions. Read each one and pick your answer, then reveal the correct answer, the reasoning, and the trap that catches most candidates.
1. A person performs real estate brokerage activity for another for compensation. Under Texas law, that person must
- A.hold a Texas real estate license
- B.merely register with the local board
- C.be at least 25 years old, with no license
- D.hold an appraiser license
Show answer and explanation
Correct answer: A. hold a Texas real estate license
Why A is correct: A person who performs an act of real estate brokerage for another in exchange for compensation must hold a Texas real estate license. For a sales agent, that license must be held in the name of and supervised by a sponsoring broker.
Trap: Acting as a broker for compensation requires a license. Local registration or age alone is not enough.
Source: TRELA (Texas Occupations Code Ch. 1101); license required
2. Which of the following is generally exempt from the requirement to hold a real estate license?
- A.A person negotiating sales for many different owners for a fee
- B.An owner selling or leasing the owner's own property
- C.A salesperson at a brokerage with no license
- D.An unlicensed assistant who negotiates contracts
Show answer and explanation
Correct answer: B. An owner selling or leasing the owner's own property
Why B is correct: An owner dealing with the owner's own property is generally exempt from the licensing requirement, as are certain attorneys and other specified persons. Negotiating sales for others for a fee requires a license.
Trap: Selling your own property is exempt. Negotiating for others for compensation is not.
Source: TRELA (Texas Occupations Code Ch. 1101); exemptions
3. To activate and use a Texas sales agent license, the candidate must
- A.simply pass the exam and wait
- B.complete the required qualifying education, pass the exam, meet fitness requirements, and be sponsored by an active broker
- C.open a brokerage immediately
- D.complete continuing education before the exam
Show answer and explanation
Correct answer: B. complete the required qualifying education, pass the exam, meet fitness requirements, and be sponsored by an active broker
Why B is correct: A sales agent license is activated by completing the required qualifying education, passing the exam, meeting honesty and fitness requirements, and being sponsored by an active broker. Holding the license without a sponsoring broker does not allow brokerage activity.
Trap: Passing the exam alone does not let a sales agent work. An active sponsoring broker is required to act.
Source: TRELA (Texas Occupations Code Ch. 1101); licensing process
4. How many hours of qualifying education must a Texas sales agent applicant complete before being licensed?
- A.60 hours
- B.120 hours
- C.180 hours
- D.270 hours
Show answer and explanation
Correct answer: C. 180 hours
Why C is correct: A Texas sales agent applicant must complete 180 hours of qualifying real estate education, made up of six 30-hour courses, including Principles of Real Estate I and II, Law of Agency, Law of Contracts, Promulgated Contract Forms, and Real Estate Finance.
Trap: 180 hours is the sales agent qualifying-education requirement. The 270-hour figure relates to additional broker education, not the initial sales agent license.
Source: TREC Rules, 22 TAC Ch. 535; qualifying education
5. A Texas real estate license is issued for a term of
- A.one year
- B.two years
- C.four years
- D.the life of the license holder
Show answer and explanation
Correct answer: B. two years
Why B is correct: A Texas real estate sales agent or broker license is issued for a two-year term and must be renewed before it expires. Renewal requires the applicable education and fees.
Trap: The license term is two years, not one. Continuing education is tied to that two-year renewal cycle.
Source: TRELA (Texas Occupations Code Ch. 1101); license term
6. At a sales agent's FIRST license renewal, the additional education required is
- A.18 hours of continuing education
- B.90 hours of Sales Agent Apprentice Education (SAE), including the 30-hour Real Estate Brokerage course
- C.nothing beyond the renewal fee
- D.another 180 hours of qualifying education
Show answer and explanation
Correct answer: B. 90 hours of Sales Agent Apprentice Education (SAE), including the 30-hour Real Estate Brokerage course
Why B is correct: Before the first renewal, a sales agent must complete 90 hours of Sales Agent Apprentice Education (SAE), which must include the 30-hour Real Estate Brokerage course, plus Legal Update I and II. After the first renewal, standard 18-hour continuing education applies.
Trap: The first renewal requires SAE (90 hours), not the ordinary 18-hour CE. The 18-hour cycle begins at later renewals.
Source: TREC Rules, 22 TAC Ch. 535; SAE requirement
7. After the first renewal, the continuing education a Texas license holder must complete each renewal period is
- A.18 hours, including 4 hours of Legal Update I and 4 hours of Legal Update II
- B.30 hours of any approved courses
- C.no continuing education once licensed
- D.90 hours of apprentice education each cycle
Show answer and explanation
Correct answer: A. 18 hours, including 4 hours of Legal Update I and 4 hours of Legal Update II
Why A is correct: Each two-year renewal after the first requires 18 hours of continuing education, including 4 hours of Legal Update I and 4 hours of Legal Update II. The remaining hours may be elective approved courses.
Trap: Legal Update I and II (4 hours each) are mandatory parts of the 18-hour CE. They are not optional electives.
Source: TREC Rules, 22 TAC Ch. 535; continuing education
8. Before applying, an applicant worried about a past criminal issue may ask TREC to evaluate eligibility by requesting a
- A.Fitness Determination
- B.broker price opinion
- C.certificate of occupancy
- D.homestead exemption
Show answer and explanation
Correct answer: A. Fitness Determination
Why A is correct: A person concerned about whether a criminal background or other history will bar licensure may request a Fitness Determination from TREC before investing in education. TREC reviews honesty, trustworthiness, and integrity.
Trap: The Fitness Determination is the pre-application tool for background concerns. It is not the same as the license application itself.
Source: TRELA (Texas Occupations Code Ch. 1101); honesty and fitness
9. A Texas sales agent may lawfully receive a commission
- A.directly from the buyer in cash
- B.only from and through the sponsoring broker
- C.from any broker in the transaction
- D.directly from the seller at closing
Show answer and explanation
Correct answer: B. only from and through the sponsoring broker
Why B is correct: A sales agent may receive compensation for brokerage activity only from the sponsoring broker. A sales agent may not accept a fee or commission directly from a buyer, seller, or another broker.
Trap: Pay flows through the sponsoring broker. A client paying the sales agent directly is a violation.
Source: TRELA (Texas Occupations Code Ch. 1101); compensation
10. Which person is generally EXEMPT from the requirement to hold a Texas real estate license?
- A.An unlicensed assistant who negotiates contracts for a broker
- B.An attorney licensed in Texas acting as an attorney
- C.A person who lists homes for several owners for a fee
- D.A sales agent without a sponsoring broker
Show answer and explanation
Correct answer: B. An attorney licensed in Texas acting as an attorney
Why B is correct: An attorney licensed in Texas is exempt from the real estate licensing requirement, as are owners dealing with their own property and certain others. Negotiating transactions for others for compensation requires a license.
Trap: The attorney exemption is for a licensed Texas attorney. An unlicensed assistant negotiating contracts is acting without a required license.
Source: TRELA (Texas Occupations Code Ch. 1101); exemptions
11. An out-of-state license holder who wants to be licensed in Texas should know that Texas
- A.grants automatic reciprocity to all states
- B.has no reciprocity; the applicant must meet Texas education and exam requirements
- C.recognizes any active license without further steps
- D.waives all education for any out-of-state licensee
Show answer and explanation
Correct answer: B. has no reciprocity; the applicant must meet Texas education and exam requirements
Why B is correct: Texas does not offer license reciprocity with any state. An out-of-state applicant must meet Texas qualifying-education and examination requirements, although a qualifying active license holder may be eligible to have the national portion of the exam waived.
Trap: There is no Texas reciprocity. An out-of-state license does not transfer automatically.
Source: TREC Rules, 22 TAC Ch. 535; licensure of out-of-state applicants
12. When a sales agent's sponsorship by a broker ends, the sales agent's license
- A.is automatically revoked
- B.becomes inactive, and the agent may not perform brokerage until sponsored again
- C.continues to allow brokerage activity for 90 days
- D.transfers to the agent's own brokerage
Show answer and explanation
Correct answer: B. becomes inactive, and the agent may not perform brokerage until sponsored again
Why B is correct: When sponsorship ends, the sales agent's license becomes inactive. An inactive license holder may not perform any act of real estate brokerage until a new sponsoring broker is in place and TREC records are updated.
Trap: Loss of sponsorship makes the license inactive, not revoked. No brokerage activity is allowed while inactive.
Source: TRELA (Texas Occupations Code Ch. 1101); active and inactive status
13. A license holder who changes mailing address or contact information must
- A.do nothing until renewal
- B.notify TREC of the change as required by the rules
- C.publish the change in a newspaper
- D.obtain a new license number
Show answer and explanation
Correct answer: B. notify TREC of the change as required by the rules
Why B is correct: A license holder is responsible for keeping current contact information on file and must notify TREC of changes such as a mailing address. License holders are also responsible for promptly updating sponsorship changes.
Trap: Keeping TREC informed is an ongoing duty, not something that waits for renewal.
Source: TREC Rules, 22 TAC Ch. 535; license holder information
14. Which statement about who may sponsor a sales agent is correct?
- A.Another sales agent may sponsor a sales agent
- B.Only an active Texas broker may sponsor a sales agent
- C.A sales agent needs no sponsor once licensed
- D.A title company may sponsor a sales agent
Show answer and explanation
Correct answer: B. Only an active Texas broker may sponsor a sales agent
Why B is correct: Only an active Texas broker may sponsor a sales agent. A sales agent cannot sponsor another sales agent, and a sales agent cannot operate independently or as a broker.
Trap: Sales agents are sponsored by brokers, never by other sales agents. Supervision and responsibility run to the broker.
Source: TRELA (Texas Occupations Code Ch. 1101); sponsorship
15. To qualify for a Texas broker license, an applicant generally must have, in addition to extra education,
- A.no experience at all
- B.active experience as a license holder, measured in points over the required period
- C.ten years as a property manager only
- D.a college degree in real estate
Show answer and explanation
Correct answer: B. active experience as a license holder, measured in points over the required period
Why B is correct: A broker applicant must have at least four years of active experience as a license holder during the prior five years, meet a transactional experience-points requirement, and complete additional qualifying education (270 hours, for 900 total) beyond the sales agent requirement.
Trap: Becoming a broker requires documented active experience plus added education, not just more classroom hours.
Source: TRELA (Texas Occupations Code Ch. 1101); broker qualifications
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Get the full question bankFrequently asked questions
Who must hold a Texas real estate license?+
A person who performs an act of real estate brokerage for another in exchange for compensation must hold a Texas license. A sales agent's license must be held in the name of and supervised by a sponsoring broker.
Who is exempt from holding a real estate license?+
Owners dealing with their own property are generally exempt, as are certain attorneys and other specified persons. Negotiating sales or leases for others for compensation requires a license.
What does it take to activate a Texas sales agent license?+
A candidate must complete the required qualifying education, pass the exam, meet honesty and fitness requirements, and be sponsored by an active broker. Without an active sponsoring broker, the license holder cannot perform brokerage activity.