Maryland Finance (alternative)
Practice Questions & Answers (2026)
Finance questions on the Maryland real estate exam cover mortgage types, loan-to-value ratios, qualifying ratios, and federal lending laws. The Maryland Real Estate Commission tests both the mechanics of real estate financing and the regulatory framework — particularly RESPA, TILA (Truth in Lending), and the TRID rules that govern loan disclosures. Maryland candidates often lose points on financing questions because they understand the concept but miss the specific numerical thresholds or disclosure timing requirements that appear on the MD exam. Pay particular attention to ARM vs. fixed-rate mortgage distinctions, the calculation of LTV ratios, and what information must appear in specific disclosure documents.
Updated May 2026 · Maryland Real Estate Commission exam outline
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Maryland Finance (alternative) — Practice Questions & Answers
73 questions on Finance (alternative) from the Maryland real estate question bank. First 10 are free — sign up to unlock all 73.
Q1. In Maryland, a 'blanket mortgage' covers:
Explanation
A blanket mortgage covers two or more parcels of real property under one mortgage. Developers commonly use them to finance multiple lots with a 'release' clause for individual lots as they are sold.
Q2. The Maryland Homebuyer Education requirement for certain state mortgage programs requires borrowers to complete:
Explanation
Maryland's state mortgage programs (such as the Maryland Mortgage Program) typically require borrowers to complete a HUD-approved homebuyer education course before closing.
Q3. In Maryland, the Home Affordable Modification Program (HAMP) was designed to:
Explanation
HAMP (now expired) was a federal program that helped eligible homeowners in Maryland and nationwide modify their mortgage terms — reducing interest rates and extending terms — to prevent foreclosure.
Q4. In Maryland, a borrower's PITI payment includes:
Explanation
PITI = Principal + Interest + property Taxes + Insurance (homeowners insurance and PMI if applicable). Lenders use PITI to calculate the front-end debt-to-income ratio.
Q5. Maryland's predatory lending laws are designed to protect borrowers from:
Explanation
Maryland has enacted laws to combat predatory lending practices — excessive points and fees, loan flipping, negative amortization without disclosure, and other harmful practices targeting vulnerable borrowers.
Q6. A Maryland borrower seeking a reverse mortgage must be at least:
Explanation
FHA Home Equity Conversion Mortgages (HECMs) — the most common type of reverse mortgage — require borrowers to be at least 62 years old.
Q7. A Maryland borrower using an FHA loan is required to pay Mortgage Insurance Premium (MIP). The MIP differs from PMI because it:
Explanation
FHA MIP includes both an upfront premium and an annual premium. Unlike conventional PMI, FHA MIP typically continues for the life of the loan (for low down payment loans), regardless of equity.
Q8. In Maryland, a 'portfolio loan' is one that:
Explanation
Portfolio loans are originated and held by the lender (not sold to Fannie Mae or Freddie Mac), allowing more flexible underwriting. Maryland community banks often offer portfolio products for unique properties or borrowers.
Q9. In Maryland, the APR on a mortgage will be equal to the stated interest rate when:
Explanation
The APR equals the stated rate only when there are zero additional costs. In practice, there are always fees, so APR is virtually always higher than the stated interest rate.
Q10. In Maryland, a 'construction loan' for a new home is typically converted to a:
Explanation
Construction loans fund the building process and are typically converted to a permanent 'end loan' (standard mortgage) upon completion of construction and issuance of a certificate of occupancy.
Q11. Maryland's Section 8 Housing Choice Voucher program is administered by:
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