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80 multiple-choice questions and 81 flashcards on Financing, about 10% of the Real Estate License bank. Every one carries a written rationale.
Financing is one of 13 chapters in CoStudy's Real Estate License bank, and it holds 80 of the bank's 796 multiple-choice questions — roughly 10% of the total. That proportion is not arbitrary: chapters follow the certifying body's published exam outline, and the number of questions in each is set by that domain's published weight, so the share of your practice time this chapter takes matches the share of the real exam it accounts for.
Studying by chapter is worth doing once you have a diagnostic score. A single overall percentage tells you whether you are close; it does not tell you which domain is dragging. Working a weak chapter in isolation, and re-testing it in isolation, is the fastest way to move a score that has stalled — and it is why the mock exams in CoStudy report by domain rather than as one number.
7 questions drawn from this chapter, with the full rationale shown — the controlling principle behind the right answer, and why each wrong option tempts and fails.
Buyer buys a $400,000 home with a $320,000 loan. LTV is:
Answer: A — A loan-to-value ratio of 80%
A) Correct — 320 ÷ 400. B) That is down %. C) Direction reversed. D) Off-by-one.
Private mortgage insurance (PMI) is generally required when the:
Answer: A — LTV exceeds 80% conventional
A) Correct — high-LTV conventional. B) Credit affects rate. C) PMI protects lender. D) FHA uses MIP.
Security-deposit rules in most U.S. states typically govern:
Answer: A — Maximum amount, required handling, itemization at move-out, return deadlines
A) Correct - statewide statutory rules. B) Wrong - regulated. C) Wrong - TRID is mortgage. D) Wrong - no federal cap.
In real estate finance, what does the abbreviation LTV stand for?
Answer: A — Loan-to-Value ratio of loan to appraised value
A) Correct — LTV is Loan-to-Value; above 80% typically requires PMI. B) Not a standard finance term. C) Not a standard abbreviation. D) Sound-alike distractor; not a real ratio.
Real estate commissions in the United States are:
Answer: D — Negotiable between the broker and the individual client
A) Wrong - no state fixes rates. D) Correct - Sherman Act bans fixing. C) Wrong - would be price fixing. B) Wrong - RESPA governs settlement.
A lien against real estate is BEST defined as:
Answer: D — A recorded claim securing payment of a debt or obligation
A) Wrong - gift is not a lien. B) Wrong - zoning is police power. C) Wrong - licenses are revocable. D) Correct - mortgages, tax liens.
Which is TRUE of a conventional conforming residential loan?
Answer: C — It meets Fannie/Freddie underwriting
A) That is FHA. B) That is VA. C) Correct — conforming criteria. D) It has a limit.
4 cards from the 81 in this chapter.
A buyer gets a loan commitment from a lender. Is the lender obligated to make the loan?
A commitment letter is generally binding if the borrower meets all conditions. However, the commitment usually has an expiration date and conditions that must be met.
What is an adjustable-rate mortgage (ARM)?
A mortgage where the interest rate adjusts periodically based on a benchmark index plus a margin. Initial rate is typically lower than fixed-rate.
What is a jumbo loan?
A mortgage exceeding conforming loan limits set by FHFA (currently $766,550 in most areas, higher in high-cost areas). Not eligible for purchase by Fannie Mae or Freddie Mac.
What is a vendor take-back mortgage?
Seller financing where the seller acts as the lender, providing a mortgage to the buyer for part of the purchase price. Also called a purchase money mortgage.
These are a sample. The full Financing chapter runs 161 items with per-chapter progress tracking, on the web and in the iOS app.
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