NJ real estate exam glossary
145 terms from the PSI New Jersey salesperson exam, each in one or two plain sentences. The 54 terms marked NJ only exist in New Jersey law, and every term links to the study guide topic where it is tested.
145 terms
A
- Absolute auction exception NJ
- The 2022 Sullivan ruling that attorney review does not apply to in-person absolute auctions without reserve.
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- Anti-Eviction Act
- NJ law requiring good cause to evict or refuse to renew most residential tenants.
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- Appraisal
- An estimate of value by a licensed appraiser, usually using sales comparison, cost or income approaches.
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- Attorney review NJ
- A three-business-day period for either party's attorney to approve, disapprove or propose changes to a licensee-prepared residential contract.
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B
- Back-up offer NJ
- An offer received while a contract is pending. In NJ the owner must be advised in writing to consult an attorney.
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- Bargain and sale deed
- A deed implying the grantor holds title, often with covenants against the grantor's own acts. Common in New Jersey.
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- Brokerage services agreement NJ
- The written agreement NJ firms need in residential deals since August 2024. It states the relationship and that compensation is fully negotiable.
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- Business day NJ
- For NJ attorney review, excludes Saturdays, Sundays and legal holidays. Other laws use different definitions; TRID waiting periods generally count Saturdays.
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- Buyer rebate NJ
- Part of the broker's commission returned to a residential buyer. In NJ only brokers may give one, agreed in writing at the start and paid at closing.
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C
- CC&Rs
- Covenants, conditions and restrictions recorded for a subdivision that limit how owners use their lots.
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- Chain of title
- The recorded history of ownership transfers for a property, checked in a title search.
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- Closing Disclosure
- The final loan terms form, received at least three business days before closing.
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- Commingling NJ
- Mixing client funds with the broker's own money, or failing to deposit them promptly.
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- Comparative market analysis (CMA)
- A licensee's estimate of market value based on comparable sales. Not an appraisal.
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- Conforming loan
- A conventional loan within Fannie Mae and Freddie Mac limits, $832,750 for one unit in most areas in 2026.
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- Constructive notice
- Legal notice given to everyone by recording a document in public records.
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- Consumer Information Statement (CIS) NJ
- NJ document explaining the five business relationships a firm may offer. Explained before the first discussion of motivation or finances.
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- Continuing education (CE) NJ
- 12 hours for the 2025 to 2027 NJ license term, at least 6 in core topics. Terms starting July 1, 2027 require 18 hours under P.L. 2026, c.52.
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D
- Deed in lieu of foreclosure
- A borrower deeds the property to the lender to avoid a foreclosure suit.
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- Depreciation
- Loss in value from physical deterioration, functional or external obsolescence.
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- Designated agent NJ
- A NJ licensee assigned by a dual agency firm to represent only the buyer or only the seller. Added to the CIS on August 1, 2024.
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- Disclosed dual agent NJ
- A NJ licensee representing both buyer and seller with informed written consent from both.
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E
- Earnest money
- A buyer's good-faith deposit, usually held in the broker's trust account or by an attorney until closing.
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- Eminent domain
- Government's power to take private property for public use with just compensation.
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- Escrow holder NJ
- Anyone legally authorized to hold deposits, such as the broker, an attorney or a bank.
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- Established business relationship
- Do Not Call exception allowing calls for up to 18 months after a consumer's last transaction.
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- Exclusive agency listing
- A listing where the broker is paid unless the owner finds the buyer.
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- External obsolescence
- Loss in value from outside the property, like a new highway. Also called economic obsolescence. Usually incurable.
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F
- Fair Chance in Housing Act NJ
- NJ law limiting how most landlords can use criminal history in tenant screening.
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- Familial status
- A protected class covering households with children under 18 living with a parent or guardian, pregnant people and anyone securing custody of a child.
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- Farmland Assessment Act NJ
- NJ law letting land actively devoted to agriculture be taxed at its farm value.
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- Fixture
- Personal property attached to land or a building so that it becomes part of the real property.
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- Flood risk disclosure NJ
- NJ seller disclosure of flood zone status, flood insurance, past claims and known flood damage (P.L. 2023, c. 93).
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- Flood Risk Notice NJ
- Landlord's notice of flood zone status and known flooding, given before a lease is signed or renewed.
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- Freshwater Wetlands Protection Act NJ
- A 1987 NJ law limiting development in freshwater wetlands.
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- Full Disclosure Act NJ
- NJ Real Estate Sales Full Disclosure Act. Requires registration and a public offering statement for out-of-state subdivided land, condos and community properties offered in NJ.
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- Functional obsolescence
- Loss in value from a design or layout flaw inside the property, like an outdated floor plan.
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G
- General agent
- An agent authorized to handle a range of matters for the principal, like a property manager.
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- Graduated percent fee NJ
- Seller-paid NJ fee of 1% to 3.5% on sales over $1 million, for deeds recorded on or after July 10, 2025. Replaced the buyer-paid mansion tax.
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- Gross rent multiplier
- Sale price divided by gross monthly rent, used to estimate value for small rental homes.
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- Group boycott
- Competitors agreeing not to work with a third party, such as a discount broker. An antitrust violation.
- Study it
I
- IDEMIA (IdentoGO) NJ
- The state's fingerprint vendor for NJ license applicants. The fee is $66.05.
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- Inducement NJ
- A free or discounted offer to attract business. In NJ, offers over $1,000 retail need written disclosure, and lotteries, contests and drawings are not allowed.
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- Informed written consent NJ
- Separate written approval from both parties needed for dual or designated agency. Receiving the CIS alone is not consent.
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J
L
- Law Against Discrimination (LAD) NJ
- NJ's anti-discrimination law, with more protected characteristics in housing than federal law.
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- Lead Warning Statement
- Required lead paint language in pre-1978 sale contracts and leases, signed by the parties and their agents.
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- Lead-based paint disclosure
- Federal rule for housing built before 1978: sellers and landlords give the EPA pamphlet and disclose known lead hazards, and buyers get 10 days to test, unless the parties agree in writing to a different period or the buyer waives it in writing.
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- Loan Estimate
- TRID form showing estimated loan terms and costs, delivered within 3 business days of application.
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M
- Market allocation
- Competitors dividing territories or customers among themselves. An antitrust violation.
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- Megan's Law statement NJ
- Required in NJ residential contracts and leases. Licensees refer sex offender questions to the county prosecutor.
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- Metes and bounds
- A legal description using distances and directions from a point of beginning.
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- Mount Laurel doctrine NJ
- Requires NJ municipalities to provide a realistic opportunity for their fair share of affordable housing.
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N
- Net listing NJ
- A listing where the broker keeps everything above a set price. Prohibited in NJ.
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- Nominal amount NJ
- A clearly small sum of the broker's own money kept in the trust account to keep it open or cover bank charges.
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- Notice of disapproval NJ
- An attorney's notice, delivered within the review period, that cancels the contract.
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- Notice to cease
- Written warning to stop a lease violation, required before evicting for grounds like disorderly conduct.
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- Novation
- Replacing a contract or party with a new one and releasing the original obligation.
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O
- Off-site condition NJ
- A nearby feature like a landfill or high-voltage line, listed with the municipal clerk for buyers to review.
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- Open house sign NJ
- Required notice at a public residential open house stating the agent represents the seller and visitor information is not confidential.
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- Origination fee
- Lender's fee for making the loan, stated as a percent of the loan amount, like points.
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P
- Pinelands Development Credit NJ
- Credit that preservation-area owners sell to developers so they can build at higher density in Pinelands growth areas.
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- Police power
- Government's power to regulate land use for public health, safety and welfare, through zoning and building codes.
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- Prescribed commission NJ
- A preset fee or rate in a listing or sale contract. Prohibited, including a small blank beside a percent sign.
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- Promptly (escrow) NJ
- Under NJ escrow rules, deposited no more than five business days after the funds are received.
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- Proprietary lease
- The lease a co-op shareholder holds that gives the right to occupy a specific unit.
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- Psychological impairment NJ
- A non-physical stigma like a death in the home. Not volunteered, but answered if asked.
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Q
- Quarterly reconciliation NJ
- Matching checkbook, bank statement and client ledger balances for the trust account at least every 3 months.
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R
- Radon
- A naturally occurring radioactive gas that can enter homes from the ground. Testing is common in sales.
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- Real Estate Guaranty Fund NJ
- NJ fund that pays eligible consumer claims when a judgment against a licensee cannot be collected. $10 of the salesperson license fee goes to it.
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- Real estate referral company NJ
- A separate business a licensed broker sets up and supervises to employ referral agents.
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- Realty Transfer Fee (RTF) NJ
- Seller-paid NJ fee at deed recording, charged per $500 of price in rising bands.
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- Reasonable modification NJ
- A physical change to a unit for a person with a disability, generally at the tenant's expense.
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- Reconciliation
- The final appraisal step: weighing the approaches by reliability to reach one value, not averaging them.
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- Redlining
- Refusing loans or insurance in certain areas based on residents' protected characteristics.
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- Rent Security Deposit Act
- NJ law capping deposits at 1.5 months' rent, held in an interest-bearing account, returned within 30 days.
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- RESPA
- Federal law covering settlement procedures. Bans kickbacks and unearned referral fees.
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- Rollback taxes NJ
- Tax recapture when farmland assessed land changes use: the year of change plus the 2 prior tax years.
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S
- Self-help eviction
- Forcing a tenant out without a court judgment, such as changing locks or cutting utilities; illegal in NJ.
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- Sherman Act
- Federal antitrust law. Criminal penalties reach $100 million for corporations, $1 million for individuals and 10 years in prison.
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- Source of lawful income NJ
- LAD protection covering vouchers and other lawful income used for rent or mortgage payments.
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- Special agent
- An agent authorized for one specific task, like a listing broker hired to sell one property.
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- Special assessment
- A charge on only the properties that benefit from a specific public improvement; a specific lien.
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- Statute of frauds
- Generally requires a signed writing. N.J.S.A. 25:1-13(b) permits a New Jersey real estate agreement to be proved by clear and convincing evidence.
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T
- Tenancy by the entirety
- Co-ownership by spouses, and in NJ civil union partners, with survivorship.
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- Tie-in arrangement
- Requiring a customer to buy a second product or service to get the first.
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- Trade fixture
- Equipment a commercial tenant installs for business that stays the tenant's personal property and can be removed.
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- Transition area NJ
- Regulated buffer around a freshwater wetland, up to 150 feet for exceptional resource value wetlands.
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- TRID
- Federal rules combining loan disclosures into the Loan Estimate and Closing Disclosure.
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- Truth in Renting Act NJ
- NJ law requiring landlords of buildings with three or more total dwelling units (four or more if owner-occupied) to give tenants the state's rights guide.
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U
- Unenforceable
- A contract that a court will not enforce because a legal requirement is unmet. An oral agreement is not automatically unenforceable in New Jersey.
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- Unilateral contract
- A promise exchanged for an act. Only one party is bound, and only once the act is performed.
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- Upfront MIP
- FHA's one-time mortgage insurance premium, 1.75% of the base loan amount, often financed into the loan.
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- Use variance
- In NJ, a 'd' variance allowing a use the zone prohibits; needs at least 5 affirmative board votes.
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V
- VA funding fee
- One-time fee on most VA loans that replaces monthly mortgage insurance, which VA loans do not require.
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W
- Waiver of Broker Cooperation NJ
- Signed owner direction not to cooperate with other brokers, attached to the listing agreement.
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- Written buyer agreement
- Since August 17, 2024, required before an MLS participant working with a buyer tours a home with that buyer, with compensation stated specifically.
- Study it
Glossary FAQ
Knowing the word is half of it. Test yourself with the flashcards in each study topic.
The Consumer Information Statement. It explains the five business relationships a New Jersey firm can offer: seller's agent, buyer's agent, disclosed dual agent, designated agent and transaction broker.