Real Estate Math
A property in Albuquerque sold for $410,000. Using a 5% commission, how much does the listing side earn if commissions are split 50/50?
A$10,250✓ Correct
B$20,500
C$41,000
D$8,200
Explanation
Total commission = $410,000 × 0.05 = $20,500.
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Key Terms to Know
Amortization
The gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
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.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
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