A NC 'swing loan' (bridge loan) is used when a buyer needs to purchase before their current home sells. The risk of this financing strategy is:
Why The buyer may carry two properties if the current home does not sell promptly, creating financial strain Is Correct
Answer B: The buyer may carry two properties if the current home does not sell promptly, creating financial strain
Exam Tip: Finance
Finance questions often involve calculations. Master the T-bar method, understand the difference between conventional and government-backed loans, and know key ratios like LTV and DTI.
People Also Study
Related North Carolina Questions
- An NC purchase contract includes a contingency that the buyer must sell their current home before closing. If the buyer cannot sell in time, the buyer may:Contracts
- A NC seller who receives an offer during the due diligence period with a contingency to sell their current home is encountering which type of provision?Contracts
- A seller owes $185,000 on their mortgage. They want to net $130,000 after paying the loan and a 5% commission. What must the house sell for?Real Estate Math
- A NC 'bridge loan' is used primarily to:Finance
- A broker in NC negotiates a listing for $450,000 and the home sells at full price. The 6% commission is shared 50/50 between listing and selling firms. Each firm's broker receives 70% of their firm's share. Each broker earns:Real Estate Math
- A NC agent who advises their buyer client to offer a lower price because the seller needs to sell quickly — using seller motivation information the agent gained as a transaction facilitator — has violated the duty of:Agency
- A buyer in NC offers to purchase a property subject to a financing contingency of $260,000 at 6% for 30 years. If the appraised value comes in at $270,000 and the purchase price is $280,000, how much must the buyer pay above the appraised loan base?Real Estate Math
- Discount points on a mortgage loan are used to:Finance
Key Terms to Know
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.
Math Concepts
Study This Topic
Practice More North Carolina Real Estate Questions
1,400+ questions covering all exam topics. Start free — no signup required.
Take the Free North Carolina Quiz →