Real Estate Math
A Pennsylvania broker charges 6% commission on a sale. After paying a 50/50 split to the cooperating buyer's broker, each side earns how much on a $380,000 sale?
A$7,600
B$11,400✓ Correct
C$22,800
D$8,400
Explanation
Total commission = 6% × $380,000 = $22,800. Each side receives 50% = $22,800 ÷ 2 = $11,400.
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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.
Math Concepts
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