Finance
A Washington buyer borrows $400,000 at 7% annual interest. What is the interest accrued in the first month?
A$2,333✓ Correct
B$2,450
C$2,800
D$3,500
Explanation
Monthly interest = Principal × Annual Rate ÷ 12 = $400,000 × 7% ÷ 12 = $400,000 × 0.005833 = $2,333 (rounded).
People Also Study
Related Washington Questions
- A Washington duplex is purchased for $570,000 with 20% down. The annual interest rate is 6.75%. Monthly interest-only payment is:Real Estate Math
- A Washington homeowner borrows $50,000 in a second mortgage at 8% annual interest only. Monthly payment is:Real Estate Math
- A Washington borrower's monthly principal and interest payment is $2,100. The lender requires the housing expense ratio not to exceed 28%. What minimum monthly gross income is required?Finance
- A Washington property manager charges 8% of gross monthly rents collected. The property generates $12,500/month. What is the annual management fee?Real Estate Math
- A Washington homeowner has a $350,000 loan at 6.5% interest only for the first year. What is the monthly interest payment?Real Estate Math
- A Washington buyer's 30-year loan is $390,000 at 6.5%. The monthly P&I payment factor for $1,000 at 6.5% is $6.32. After the first month, the balance is approximately:Finance
- Under the federal Truth in Lending Act (TILA), the Annual Percentage Rate (APR) disclosed to a Washington borrower:Finance
- A Washington seller agrees to pay two discount points to buy down a buyer's interest rate. If the loan amount is $380,000, what is the cost of the points?Finance
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.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
Fiduciary DutyThe highest legal duty an agent owes to a principal — requiring the agent to act in the principal's best interest above all others.
Study This Topic
Practice More Washington Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Washington Quiz →