Real Estate Math
A Texas property is under contract at $275,000. The buyer's lender requires the property to appraise at or above the purchase price for a 90% LTV loan. What is the minimum appraised value needed?
A$247,500
B$275,000✓ Correct
C$288,750
D$305,556
Explanation
At a 90% LTV, the lender loans 90% of the appraised value or purchase price (whichever is lower). For the loan amount to be 90% of $275,000 = $247,500, the property must appraise at least at $275,000. If it appraises lower, the loan amount would be limited.
Related Texas Real Estate Math Questions
- A property management company manages 120 units. Average monthly rent is $1,100. Management fee is 9% of collected rent. If the vacancy rate is 5%, what are the annual management fees?
- A Texas buyer makes an offer of $285,000 with $5,000 earnest money and a $250 option fee for a 10-day option period. If the buyer terminates on day 7, they receive back:
- A Texas commercial property has a gross rent of $240,000 and a GRM of 8.5. What is the estimated value?
- A Texas property has a potential gross income of $96,000, vacancy of 8%, and operating expenses of $28,000. If the cap rate is 8.5%, what is the estimated value?
- A property in Texas was purchased for $180,000 five years ago and now sells for $225,000. What is the percentage of appreciation?
- A Texas home sale closes on March 15. Annual property taxes are $6,000 and the tax year runs January–December. How much does the buyer owe in prorated property taxes (buyer's share from March 15 to December 31)?
- A Texas building rents for $2,200/month. The owner wants a 10% annual return on their investment. What is the maximum price the investor should pay?
- A Texas commercial property has an asking price of $1,200,000. NOI is $84,000/year. What is the cap rate being asked?
Practice More Texas Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Texas Quiz →