A Delaware seller nets $195,000 after paying off a $145,000 mortgage, a 5.5% commission on a sale price of $360,000, and $4,000 in other closing costs. Did the seller achieve this net?
Why $191,200 Is Correct
Answer A: $191,200
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.
Key Real Estate Math Terms in This Question
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Key Terms to Know
Fees and expenses paid by the buyer and/or seller at the closing of a real estate transaction, in addition to the property's purchase price.
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.
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.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
Math Concepts
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