A buyer is purchasing a property for $340,000 with a loan at 85% LTV. How much is the required down payment?
Correct Answer
C) $51,000
The buyer must pay the portion not financed: $340,000 × (1 − 0.85) = $51,000.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Proration calculations divide shared expenses such as property taxes, insurance, HOA dues, and rent between buyer and seller at closing based on the number of days each party owns the property.
Transfer tax is a tax imposed on the transfer of real property ownership, typically calculated based on the sale price and paid at closing. It is commonly expressed as a rate per $100, $500, or $1,000 of the sale price.
Annual interest is the total amount of interest charged on a loan or investment over a year.
More Real Estate Math Questions
A Texas agent earns a 6% commission on a $350,000 sale. The listing broker takes 60% of the commission. How much does the listing broker receive?
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- → Gross income $60,000, expenses $22,000. NOI:
- → A house sold for $275,000 which was 9% less than the original cost. What was the original cost?
- → Annual property taxes are $2,400, paid in arrears. Closing is August 1 (using a 360-day year, 30-day months). The closing day belongs to the buyer. How much does the seller owe the buyer at closing?
- → A seller closes on a property for $500,000. The commission is 6%, other seller closing costs are $4,500, and the existing mortgage payoff is $150,000. What are the seller's net proceeds before any tax effects?
- → A seller wants to net $250,000 after paying a 6% commission and has no other closing costs to consider. What sale price is needed?
- → A property sells for $220,000 and generates monthly rent of $1,600. What is the Gross Rent Multiplier (GRM)?
- → Annual property taxes are $4,380 and have not been paid for the current year. The property closes on March 15, and the seller owns the day of closing. Using a 365-day year, how much does the seller owe at closing?
- → An investor is valuing a small rental property listed at $600,000 that produces gross monthly rent of $2,900. What is the gross rent multiplier (GRM) on a monthly rent basis?
- → An investor is valuing a small rental property listed at $720,000 that produces gross monthly rent of $3,400. What is the gross rent multiplier (GRM) on a monthly rent basis?
- → 175 ft × 200 ft lot:
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