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It's rather simple... Forza 3's physics engine is just unrealistic and can't handle turning and breaking inputs at the same time.



 

 

 








I kid, I kid.... You should definitely be able to break while turning, while you don't get maximum brake efficiency unless you are traveling in a straight line it is still pretty useful. It's called trail braking and it helps to tuck your nose into a corner if done properly. All i can think of is maybe look at the aids, i hear forza will pretty much drive itself unless you take the assists off.