Real Estate Math
A buyer takes a $360,000 loan at 5.5% for 30 years. The loan balance after 5 years is $332,000. The property has appreciated to $450,000. What is the buyer's equity?
A$90,000
B$118,000✓ Correct
C$128,000
D$108,000
Explanation
Equity = Current property value – Outstanding loan balance = $450,000 – $332,000 = $118,000. To solve this, multiply the relevant values: $360,000 and $332,000 at 5.5%.. The correct answer is $118,000.. This is a common calculation on the Washington real estate exam.
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