Page |1
Champions Principles of Real Estate 2
Questions and Correct Answers/ Latest
Update / Already Graded
appraisal
Ans: value of a property maybe affected by social, econo mic,
govt and environmental influences
Loan-to-Value Ratio (LTV)
Ans: The percentage of value or sales price that a lender is
willing to finance.
limited appraisal report
Ans: exterior only/drive by inspection. deemed as low risk loan
highest and best use of property
Ans: legal use that gives the greatest return
Principal of Contribution
Ans: cost does not equal value
All rights reserved © 2025/ 2026 |
, Page |2
Residential Mortgage Loan Originators (RMLO)
Ans: Must be certified licence holders and is manda ted by the
SAFE ACT (TX dept of savings and mortgage lending)
Principle of Anticipation
Ans: purchase price is affected by the expectation of future
appeal and benefits
Principal of Substitution
Ans: value of a commodity is influenced by the cost of
acquiring subsitute or comparable item
Principal of progression
Ans: value of properties around yours goes up; so does yours
Principal of Regression
Ans: The Value of more expensive home placed in a
neighborhood of less expensive homes will drop in value
Market Value
All rights reserved © 2025/ 2026 |
, Page |3
Ans: the most probable price a property should bring in a
competitive and open market under fair conditions requisit to a
fair sale.
appraisal process
Ans: The value of a property may be affected by social,
economic, governmental and environmental influences. An
appraiser must always be aware of these influences and
possible changes in them that could affect market value.
Three approaches to value
Ans: (1) The Sales Comparison Approach
(2) The Cost Approach,
(3) The Income Approach.
Sales Comparison Approach
Ans: A value for existing properties method for comparing
similar properties to the subject property. this is the best
indicator.
Market Data Approach
Ans: aka: sales comparison approach
All rights reserved © 2025/ 2026 |
Champions Principles of Real Estate 2
Questions and Correct Answers/ Latest
Update / Already Graded
appraisal
Ans: value of a property maybe affected by social, econo mic,
govt and environmental influences
Loan-to-Value Ratio (LTV)
Ans: The percentage of value or sales price that a lender is
willing to finance.
limited appraisal report
Ans: exterior only/drive by inspection. deemed as low risk loan
highest and best use of property
Ans: legal use that gives the greatest return
Principal of Contribution
Ans: cost does not equal value
All rights reserved © 2025/ 2026 |
, Page |2
Residential Mortgage Loan Originators (RMLO)
Ans: Must be certified licence holders and is manda ted by the
SAFE ACT (TX dept of savings and mortgage lending)
Principle of Anticipation
Ans: purchase price is affected by the expectation of future
appeal and benefits
Principal of Substitution
Ans: value of a commodity is influenced by the cost of
acquiring subsitute or comparable item
Principal of progression
Ans: value of properties around yours goes up; so does yours
Principal of Regression
Ans: The Value of more expensive home placed in a
neighborhood of less expensive homes will drop in value
Market Value
All rights reserved © 2025/ 2026 |
, Page |3
Ans: the most probable price a property should bring in a
competitive and open market under fair conditions requisit to a
fair sale.
appraisal process
Ans: The value of a property may be affected by social,
economic, governmental and environmental influences. An
appraiser must always be aware of these influences and
possible changes in them that could affect market value.
Three approaches to value
Ans: (1) The Sales Comparison Approach
(2) The Cost Approach,
(3) The Income Approach.
Sales Comparison Approach
Ans: A value for existing properties method for comparing
similar properties to the subject property. this is the best
indicator.
Market Data Approach
Ans: aka: sales comparison approach
All rights reserved © 2025/ 2026 |
