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10 Scenarios

Loan Scenario Practice Calculator

Practice mortgage math with 10 original loan scenarios. Calculate DTI ratios, LTV, discount points and monthly payments using the stated assumptions. These are independent exercises, not official exam questions or loan-approval advice.

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1
DTI Ratio

A borrower earns $6,000 per month gross income. For this example only, assume a lender sets a 43% back-end DTI limit (not a universal qualification limit). What is the maximum total monthly debt payment the borrower can have?

Formula: DTI = Total Monthly Debts / Gross Monthly Income
$

Enter dollars. Accepted rounding: within $1 of the exercise answer.

2
Loan Amount

A home has a purchase price of $350,000. The borrower is making a 20% down payment. What is the loan amount?

Formula: Loan Amount = Purchase Price - Down Payment
$

Enter dollars. Accepted rounding: within $1 of the exercise answer.

3
Monthly Payment

A loan amount is $240,000 at 6.5% for 30 years. The monthly payment factor is 6.32 per $1,000. What is the monthly principal and interest (P&I) payment?

Formula: Monthly P&I = (Loan Amount / 1,000) x Factor
$

Enter dollars. Accepted rounding: within $1 of the exercise answer.

4
Discount Points

A borrower is paying 1.5 discount points on a $300,000 loan. What is the dollar amount of the points?

Formula: 1 point = 1% of the loan amount
$

Enter dollars. Accepted rounding: within $1 of the exercise answer.

5
CLTV Ratio

A property is appraised at $400,000. The borrower has a first mortgage of $300,000 and a drawn HELOC balance of $40,000 (not its credit limit). What is the combined loan-to-value (CLTV) ratio? Enter as a percentage (e.g., 85).

Formula: CLTV = (All Liens / Property Value) x 100
%

Enter a percentage, e.g. 85 (not 0.85). Accepted rounding: within 0.5 percentage points.

6
Front-End DTI

A borrower has gross annual income of $84,000. Their monthly housing payment (PITI) is $1,820. What is their front-end (housing) DTI ratio? Enter as a percentage (e.g., 28).

Formula: Front-end DTI = Monthly Housing Payment / Gross Monthly Income x 100
%

Enter a percentage, e.g. 85 (not 0.85). Accepted rounding: within 0.5 percentage points.

7
FHA Loan

A home sells for $425,000. Assume the borrower is eligible for an FHA loan and a 3.5% down payment for this exercise. What is the base loan amount (before UFMIP)?

Formula: Assumed down payment = 3.5% of purchase price
$

Enter dollars. Accepted rounding: within $1 of the exercise answer.

8
LTV Ratio

A property is valued at $500,000 with a loan amount of $475,000. What is the loan-to-value (LTV) ratio? Enter as a percentage (e.g., 80).

Formula: LTV = (Loan Amount / Property Value) x 100
%

Enter a percentage, e.g. 85 (not 0.85). Accepted rounding: within 0.5 percentage points.

9
MLO Compensation

An MLO earns 1.25% commission on a $320,000 loan origination. What is the MLO's commission in dollars?

Formula: Commission = Loan Amount x Commission Rate
$

Enter dollars. Accepted rounding: within $1 of the exercise answer.

10
Interest Calculation

Assume a $250,000 balance remains unchanged for one year at 7% simple annual interest, with no principal payments. What is the annual interest amount? Round to the nearest dollar.

Formula: Annual Interest = Loan Amount x Interest Rate
$

Enter dollars. Accepted rounding: within $1 of the exercise answer.

Master Mortgage Math for the MLO Exam

Use these original exercises to practise choosing a formula, keeping units consistent and checking your arithmetic. The results describe this small practice set, not your readiness or expected exam score.

The scenarios above cover the most common calculation types: DTI ratios (front-end and back-end), LTV and CLTV ratios, discount points, monthly P&I payments using the factor method, FHA loan calculations, and a simplified compensation example. Review missed steps and repeat the exercise with its stated assumptions.

Frequently Asked Questions

What math questions appear on the SAFE MLO exam?
The SAFE MLO exam includes questions on loan-to-value (LTV) ratios, debt-to-income (DTI) calculations, discount points, monthly payment calculations, interest computations, and down payment calculations. You need to know which formulas to apply and how to set up each calculation correctly.
How many math questions are on the MLO exam?
NMLS publishes content areas and calculation topics, but the outline does not specify a fixed count of math questions. We cannot verify a 10–15-question promise. These original exercises are practice material, not a prediction of your exam form.
Can I use a calculator on the MLO exam?
Check the current NMLS Test Day instructions for the calculator and materials permitted for your appointment. These exercises can be completed with basic arithmetic; they do not establish test-center equipment rules.
What is the most important formula for the MLO exam?
The DTI ratio calculation is arguably the most important: DTI = Total Monthly Debts / Gross Monthly Income. You should also master LTV = Loan Amount / Property Value, discount points (1 point = 1% of loan amount), and the monthly payment factor method. These formulas appear in multiple question types.
How do I calculate monthly mortgage payments for the exam?
When an exercise supplies a monthly payment factor per $1,000, use that given factor. To calculate: Monthly P&I = (Loan Amount / 1,000) x Monthly Factor. For example, a $200,000 loan with a factor of 6.32 = (200,000 / 1,000) x 6.32 = $1,264/month. This practice method does not guarantee what will be supplied on an exam.

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