Missouri Finance
Practice Questions & Answers (2026)
Finance questions on the Missouri real estate exam cover mortgage types, loan-to-value ratios, qualifying ratios, and federal lending laws. The Missouri 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. Missouri 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 MO 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.
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Missouri Finance — Practice Questions & Answers
144 questions on Finance from the Missouri real estate question bank. First 10 are free — sign up to unlock all 144.
Q1. A Missouri borrower takes out a $240,000 mortgage at 6.75% annual interest. What is the approximate first month's interest?
Explanation
Monthly interest = $240,000 × (6.75% ÷ 12) = $240,000 × 0.005625 = $1,350.
Q2. A home equity line of credit (HELOC) is best described as:
Explanation
A HELOC is a revolving line of credit secured by the homeowner's equity. The borrower can draw funds up to a credit limit, repay, and borrow again — similar to a credit card but secured by real estate.
Q3. In Missouri, USDA Rural Development loans are designed to:
Explanation
USDA Rural Development loan programs assist eligible low-to-moderate income borrowers in purchasing homes in designated rural areas with no down payment and favorable terms.
Q4. When a Missouri borrower assumes an existing mortgage, they:
Explanation
In a loan assumption, the buyer takes over the seller's existing mortgage and becomes personally liable for the debt under the original loan terms. Lender approval is typically required.
Q5. The Community Reinvestment Act (CRA) requires federally regulated financial institutions to:
Explanation
The CRA requires federally insured depository institutions to help meet the credit needs of the communities in which they operate, including low- and moderate-income neighborhoods, while maintaining safe and sound banking practices.
Q6. In Missouri, a deed of trust differs from a mortgage primarily because:
Explanation
Missouri uses deeds of trust. The borrower conveys title to a trustee who holds it as security for the lender. If the borrower defaults, the trustee can foreclose non-judicially (without court action) through a power of sale.
Q7. What is the primary purpose of private mortgage insurance (PMI) in Missouri?
Explanation
PMI protects the lender—not the borrower—against losses if the borrower defaults. It is typically required when the down payment is less than 20% of the purchase price.
Q8. A Missouri homebuyer obtains an FHA loan with 3.5% down. The home is priced at $250,000. What is the down payment?
Explanation
Down payment = $250,000 × 3.5% = $8,750. FHA loans allow down payments as low as 3.5% for borrowers with qualifying credit scores.
Q9. Under RESPA, a lender must provide a Loan Estimate to a borrower within how many business days of receiving a loan application?
Explanation
RESPA requires lenders to provide a Loan Estimate within three business days of receiving a completed mortgage loan application.
Q10. The Truth in Lending Act (TILA) requires lenders to disclose the:
Explanation
TILA (Regulation Z) requires lenders to disclose the Annual Percentage Rate (APR), finance charges, and other loan terms so borrowers can compare loan offers.
Q11. A Missouri borrower has a 30-year fixed mortgage at 6% on a $200,000 loan. If they pay $1,199 per month, approximately how much of the first payment is interest?
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