A buyer in Alaska purchases a $420,000 home, making a 15% down payment. How much private mortgage insurance is required annually if the PMI rate is 0.75% of the loan amount?
Why $2,677.50 Is Correct
Answer A: $2,677.50
Exam Tip: Real Estate Math
Math questions are formula-based. Memorize the key formulas: commission splits, proration, cap rate (NOI ÷ Value), GRM (Price ÷ Gross Rent), and LTV (Loan ÷ Value). Practice converting between annual and monthly figures.
People Also Study
Related Alaska Questions
- A buyer in Anchorage purchases a home for $450,000 with a 20% down payment. What is the loan amount?Finance
- Private Mortgage Insurance (PMI) is typically required when the buyer's down payment is:Finance
- A buyer in Alaska obtains an FHA loan. The minimum down payment required is:Finance
- An Alaska property sells for $350,000. The buyer makes a 20% down payment and finances the rest. What is the loan amount?Finance
- A buyer makes a 5% down payment on a $380,000 Alaska home. What is the mortgage amount?Real Estate Math
- A buyer purchases a $260,000 Alaska home with an FHA loan at 3.5% down. The FHA upfront MIP is 1.75% of the loan amount. What is the upfront MIP?Real Estate Math
- A mortgage loan of $200,000 at 5% interest has an annual interest payment of how much in the first year (interest only)?Real Estate Math
- A property in Alaska is purchased for $500,000. The buyer makes a 20% down payment and finances the remainder. What is the mortgage amount?Real Estate Math
Key Terms to Know
Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Math Concepts
Study This Topic
Practice More Alaska Real Estate Questions
1,400+ questions covering all exam topics. Start free — no signup required.
Take the Free Alaska Quiz →