Real Estate Math
A Michigan home is purchased for $195,000 with a 15% down payment. How much will the buyer need to borrow?
A$29,250
B$165,750✓ Correct
C$160,000
D$170,000
Explanation
Down payment = $195,000 × 15% = $29,250. Loan amount = $195,000 − $29,250 = $165,750.
People Also Study
Related Michigan Questions
- A Michigan buyer is purchasing a $350,000 home with 5% down. The FHA mortgage insurance premium (MIP) is 1.75% of the loan amount upfront. What is the upfront MIP?Finance
- A Michigan buyer uses an FHA loan with a 3.5% down payment. If the home purchase price is $200,000, what is the down payment?Finance
- Which type of Michigan mortgage loan is most common for borrowers with limited credit history who cannot afford a large down payment?Finance
- A Michigan buyer puts 10% down on a $260,000 home. What is the loan amount?Real Estate Math
- A Michigan investor purchases a property for $300,000 with a 25% down payment. What is the loan amount?Real Estate Math
- A Michigan buyer is purchasing a $350,000 home. The lender requires PMI at 0.85% of the loan amount annually. With 10% down, what is the monthly PMI payment?Real Estate Math
- A Michigan buyer obtains a conventional loan with a 20% down payment. The buyer's primary benefit of putting 20% down is:Finance
- A Michigan buyer obtains a $180,000 mortgage with a 30-year term and a monthly P&I payment of $1,198. How much total interest will be paid over the life of the loan?Real Estate Math
Key Terms to Know
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.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Pre-ApprovalA lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.
Math Concepts
Study This Topic
Practice More Michigan Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Michigan Quiz →