TEXAS REAL ESTATE FINANCE FINAL PRACTICE
EXAM 2026 QUESTIONS AND SOLUTIONS
FULL VERSION
◉ Which of the following Statements is true of private mortgage
insurance (PMI)? Answer: It may be paid in a lump sum at closing, in
some instances.
◉ At an adjustment period, the interest rate for an adjustable rate
mortgage (ARM) is determined by adding what to the index rate?
Answer: Margin
◉ When an appraiser conducts an appraisal using the cost approach,
for which things will he or she use the sales comparison approach to
value? Answer: Land
◉ What is another term for negative amortization? Answer:
Deferred Interest
◉ The Federal Housing Administration (FHA) is part of what other
government agency? Answer: Department of Housing and Urban
Development
, ◉ To determine the value of a highly specialized building, like a
museum, an appraiser would most likely use and heavily weight
which of the following appraisal methods? Answer: Cost Approach
◉ What happens in the secondary market? Answer: Real Estate
Loans are bought and sold.
◉ In Texas, which of the following is an executory contract? Answer:
Condominium Contract
◉ Which of the following is true of a VA hybrid loan? Answer: It
converts to fixed rate loans after three years.
◉ What is not part of the required lender disclosures? Answer:
Number of loans originated to women.
◉ What is the minimum down payment that allows a borrower to
avoid buying mortgage insurance premium (MIP)? Answer: 20%
◉ Which calculations on the Closing Disclosure (aka HUD-1) form
are usually completed first? Answer: Settlement Charges
EXAM 2026 QUESTIONS AND SOLUTIONS
FULL VERSION
◉ Which of the following Statements is true of private mortgage
insurance (PMI)? Answer: It may be paid in a lump sum at closing, in
some instances.
◉ At an adjustment period, the interest rate for an adjustable rate
mortgage (ARM) is determined by adding what to the index rate?
Answer: Margin
◉ When an appraiser conducts an appraisal using the cost approach,
for which things will he or she use the sales comparison approach to
value? Answer: Land
◉ What is another term for negative amortization? Answer:
Deferred Interest
◉ The Federal Housing Administration (FHA) is part of what other
government agency? Answer: Department of Housing and Urban
Development
, ◉ To determine the value of a highly specialized building, like a
museum, an appraiser would most likely use and heavily weight
which of the following appraisal methods? Answer: Cost Approach
◉ What happens in the secondary market? Answer: Real Estate
Loans are bought and sold.
◉ In Texas, which of the following is an executory contract? Answer:
Condominium Contract
◉ Which of the following is true of a VA hybrid loan? Answer: It
converts to fixed rate loans after three years.
◉ What is not part of the required lender disclosures? Answer:
Number of loans originated to women.
◉ What is the minimum down payment that allows a borrower to
avoid buying mortgage insurance premium (MIP)? Answer: 20%
◉ Which calculations on the Closing Disclosure (aka HUD-1) form
are usually completed first? Answer: Settlement Charges
