Real Estate MathIntermediateNorth Carolina Exam

A buyer in NC puts down 10% on a $475,000 home. They pay 2 discount points at closing. The total cost of the 2 points is:

Q: A buyer in NC puts down 10% on a $475,000 home. They pay 2 discount points at closing. The total cost of the 2 points is:

Loan amount = $475,000 x 0.90 = $427,500. 1 point = 1% of loan = $4,275. 2 points = $8,550. To solve this, multiply the relevant values: $475,000 at 10%.. The correct answer is $8,550.. This is a common calculation on the North Carolina real estate exam.

A$4,750

B$8,550Correct

C$9,500

D$9,975

Why $8,550 Is Correct

Answer B: $8,550

Loan amount = $475,000 x 0.90 = $427,500.

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

Discount Points

Prepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.

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Key Terms to Know

Discount Points

Prepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.

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.

Pre-Approval

A lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.

Amortization

The gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.

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