New Jersey Escrow & Title
Practice Questions & Answers (2026)
Escrow, title, and closing questions on the New Jersey exam test how real estate transactions are closed, how title is transferred, and what happens at settlement. New Jersey requires a licensed attorney to conduct real estate closings — unlike escrow states — which shapes how these questions are framed on the NJ exam. Title insurance, title searches, and the difference between standard and extended coverage policies are tested, as are the specific closing costs that are customarily paid by buyers vs. sellers under New Jersey practice.
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New Jersey Escrow & Title — Practice Questions & Answers
65 questions on Escrow & Title from the New Jersey real estate question bank. First 10 are free — sign up to unlock all 65.
Q1. New Jersey is an 'attorney state' for real estate closings. This means:
Explanation
New Jersey is an attorney state, meaning attorneys are customarily and often required to be involved in real estate transactions — particularly for the attorney review period and the conduct of the closing.
Q2. A title search in New Jersey involves examining public records to determine:
Explanation
A title search examines recorded public records (deeds, mortgages, judgments, tax liens) to determine the history of ownership and identify any liens, encumbrances, or defects affecting the title.
Q3. A New Jersey property is being sold with an open mortgage lien that must be satisfied at closing. Who is responsible for paying off this existing mortgage?
Explanation
The seller is responsible for paying off any existing mortgage liens from the sale proceeds at closing. The closing agent (title company or attorney) typically coordinates the payoff.
Q4. In New Jersey, the Closing Disclosure (CD) must be provided to the borrower at least how many business days before closing?
Explanation
Under TRID (TILA-RESPA Integrated Disclosure) rules, the Closing Disclosure must be received by the borrower at least 3 business days before consummation of the loan.
Q5. In New Jersey, who typically holds the earnest money deposit during a real estate transaction?
Explanation
In NJ, the earnest money deposit is typically held in escrow by the listing broker's trust account or by one of the attorneys, as agreed by the parties.
Q6. A title search in New Jersey examines public records to:
Explanation
A title search reviews recorded documents (deeds, mortgages, liens, judgments) to confirm ownership and identify any clouds or encumbrances on title.
Q7. An owner's title insurance policy in NJ protects:
Explanation
Owner's title insurance protects the buyer (and their heirs) against title defects, liens, or claims that arose before the policy date but were unknown at closing.
Q8. A lender's title insurance policy (mortgagee policy) in NJ protects:
Explanation
A lender's (mortgagee's) title insurance policy protects the lender's interest in the property up to the outstanding loan balance, decreasing as the loan is paid down.
Q9. A lis pendens is:
Explanation
A lis pendens (Latin for 'pending lawsuit') is filed in public records to notify potential buyers that the property is the subject of active litigation that may affect title.
Q10. In NJ, a general warranty deed provides the grantee with which covenants?
Explanation
A general warranty deed contains broad covenants (seisin, right to convey, against encumbrances, quiet enjoyment, further assurance, and warranty forever) protecting the grantee against all title claims.
Q11. A quitclaim deed in NJ conveys:
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