12/20/23,vc7:43 TestvcBankvcForvcAdvancedvcPhysiologyvcandvcPathophysiologyvcEs
vcPM sentialsvcforvcC…
NATIONAL PSI BROKER
EXAM PREP Q AND A
AvcbrokervcisvccompletingvcavcCMAvctovcdeterminevcthevcpotentialvcli
stingvcpricevcofvcavcseller'svchome.vcWhichvcofvcthevcfollowingvcisvcN
OTvcpartvcofvcthevcfinalvcCMAvcgivenvctovcthevcseller?
A)
Highestvcandvcbestvcusevcevaluation
vcB)
Comparablevcsalesvcanalysis
vcC)
Adjustmentsvctovcpastvcsales
vcD)
Picturesvcofvccomparablesvc-vcanswer--A)
Thevcanswervcisvchighestvcandvcbestvcusevcevaluation.vcAnvcapprai
servcdoesvcavchighestvcandvcbestvcusevcevaluation,vcwhichvcdoesvcn
otvcappearvcinvcavcCMA.
Housesvcinvcthevclocalvcareavchavevchadvcanvcincreasevcinvcsalesvcpr
icevcandvcavcdecreasevcinvcdaysvconvcthevcmarket.vcAvcbrokervcwhovc
isvcattemptingvctovcdeterminevcthevccurrentvcmarketvcvaluevcforvcavcr
esidentialvclistingvcwouldvcgetvcthevcBESTvcestimatevcofvcvaluevcbyvc
using
A)
avcGRMvcasvcthevcprimaryvcconsiderationvctovcdeterminevcvalue.
vcB)
thevccostvcapproachvcwithvcreproductionvcestimates.
vcC)
comparablesvcthatvcarevcnovcmorevcthanvcsixvcmonthsvcold.
vcD)
about:blan 1/
k 45
,12/20/23,vc7:43 TestvcBankvcForvcAdvancedvcPhysiologyvcandvcPathophysiologyvcEs
vcPM sentialsvcforvcC…
comparablesvcthatvcarevcnovcmorevcthanvc12vcmonthsvcold.vc-
vcanswer--C)
Thevcanswervcisvccomparablesvcthatvcarevcnovcmorevcthanvcsixvcmo
nthsvcold.vcInvcavcchangingvcmarket,vcthevcmorevcrecentvcthevccomp
arables,vcthevcmorevclikelyvctheyvcarevctovcreflectvcupwardvcorvcdow
nwardvcpricevcchanges.
Rentalvcratesvchavevcincreasedvcbyvc2%vcinvcthevclastvcsixvcmonths.
vcWhichvcappraisalvcprinciplevcBESTvcexplainsvcthisvcratevcincreas
e?
A)
Principlevcofvcsubstitution
vcB)
Principlevcofvcsupplyvcandvcdemand
vcC)
Principlevcofvccontribution
vcD)
Principlevcofvchighestvcandvcbestvcusevc-vcanswer--B)
Thevcanswervcisvcprinciplevcofvcsupplyvcandvcdemand.vcThevcprincip
levcofvcsupplyvcandvcdemandvcstatesvcthatvcasvcfewervcpropertiesvcb
ecomevcavailablevcforvcrentvcorvcsale,vcthevcpricevcownersvccanvccha
rgevcwillvcincrease.
ThevccurrentvcmonthlyvcGRMvcinvcavcneighborhoodvcisvc200,vcandvct
hevcannualvcincomevcisvc$24,000.vcWhatvcisvcthevcestimatedvcvaluev
cofvcavcpropertyvcinvcthisvcneighborhood?
A)
$200,000
vcB)
$240,000
vcC)
$400,000
vcD)
$4,800,000vc-vcanswer--C)
about:blan 2/
k 45
,12/20/23,vc7:43 TestvcBankvcForvcAdvancedvcPhysiologyvcandvcPathophysiologyvcEs
vcPM sentialsvcforvcC…
Thevcanswervcisvc$400,000.vcMonthlyvcGRMvc×vcmonthlyvcincomevc
=vcvalue.vc200vc×vc2,000vc($24,000vc÷vc12)vc=vc$400,000.
Thevcsubjectvcpropertyvchasvctwovcbathsvcandvconevcfireplace.vcThe
vcpropertyvcacrossvcthevcstreetvcsoldvcforvc$181,000vcandvchasvctwov
cbathsvcandvctwovcfireplaces.vcThevcpropertyvcbehindvcthevcsubjectv
csoldvcforvc$175,000vcandvchasvctwovcbathsvcandvcnovcfireplace.vcInvc
thevcarea,vcbathsvcarevcworthvc$5,000vcandvcfireplacesvcarevcworthv
c$3,000.vcWhatvcisvcthevcsubjectvcpropertyvcworth?
A)
$175,000
vcB)
$177,000
vcC)
$178,000
vcD)
$180,000vc-vcanswer--Thevcanswervcisvc$178,000vc
SubjectvcPropertyvcCompvc1vc$181,000vcCompvc2vc$175,000
2vcbathsvc2vcbathsvcnovcadjustmentvc2vcbathsvcnovcadjustment
1vcfireplacevc2vcfireplacesvc-vc$3,000vcNovcfireplacevc+vc$3,000
Adjustedvcpricevc$178,000vcAdjustedvcpricevc$178,000
Accordingvctovcfederalvcgovernmentvclendingvcregulations,vcavcbuy
ervcpurchasingvcavchomevcmustvchavevcanvcappraisalvcforvcallvcthevcf
ollowingvctypesvcofvcfinancingvcEXCEPT
A)
FHA.
vcB)
VA.
vcC)
loanvcsoldvctovcFNMA.
vcD)
sellervccarry.vc-vcanswer--D)
Thevcanswervcisvcsellervccarry.vcAllvcgovernmentvcloansvcandvcanyvc
soldvconvcthevcsecondaryvcmarketvcrequirevcanvcappraisal.vcAvcselle
about:blan 3/
k 45
, 12/20/23,vc7:43 TestvcBankvcForvcAdvancedvcPhysiologyvcandvcPathophysiologyvcEs
vcPM sentialsvcforvcC…
r-
carryvcloan,vcorvcsellervcfinancing,vcmayvcorvcmayvcnotvcrequirevcanvc
appraisal.
AvcbuyervcchoosesvcavcloanvcwithvcanvcLTVvcratiovcofvc90%,vcwhichvc
requiresvcthevcpurchasevcofvcPMI,vcinsteadvcofvcavcloanvcwithvcanvc8
0%vcLTV,vcwhichvcwouldvcnotvcrequirevcthevcinsurance.vcThevcbuye
rvcMOSTvclikelyvcmadevcthisvcchoicevcbecause
A)
ifvcthevcbuyervcdefaults,vcPMIvcwillvcprotectvcthevcbuyervcbyvcpayingvc
offvcthevcfullvcloan.
vcB)
thevcbuyervcwillvcmakevcavclargervcdownvcpaymentvcbutvchavevcsmal
lervcmonthlyvcpayments,vcincludingvcPMI.
vcC)
payingvcPMIvcwillvcmeanvcthatvcallvcmortgagevcpaymentsvcandvcho
meownersvcassociationvcfeesvcarevcdeferredvcinvccasevcofvcdefault.
vcD)
thevcbuyervcwantsvcavcsmallervcdownvcpayment,vcevenvcthoughvcth
evcbuyervcwillvchavevctovcpayvcPMI.vc-vcanswer--D)
Thevcanswervcisvcthevcbuyervcwantsvcavcsmallervcdownvcpayment,vc
evenvcthoughvcthevcbuyervcwillvchavevctovcpayvcPMI.vcBuyersvcarevc
willingvctovcpayvcPMIvc(privatevcmortgagevcinsurance)vcinvcordervctov
cbringvcavcsmallervcdownvcpaymentvctovcclosing,vcwhichvcwillvcmean
vcavchighervcmonthlyvcpayment.vcPMIvcprotectsvclendersvcinvccasevc
ofvcdefault.
Avcbuyervcisvcgettingvcavcnewvcmortgagevcwithvcavc95%vcloan-to-
valuevcratio.vcThevcfinalvcloanvcamountvcthevclendervcwillvclendvcthevc
buyervcisvcdeterminedvcbyvcthe
A)
lowervcofvcthevcsalesvcpricevcorvcappraisedvcvalue.
vcB)
highervcofvcthevcsalesvcpricevcorvcappraisedvcvalue.
vcC)
salesvcpricevconly.
about:blan 4/
k 45
vcPM sentialsvcforvcC…
NATIONAL PSI BROKER
EXAM PREP Q AND A
AvcbrokervcisvccompletingvcavcCMAvctovcdeterminevcthevcpotentialvcli
stingvcpricevcofvcavcseller'svchome.vcWhichvcofvcthevcfollowingvcisvcN
OTvcpartvcofvcthevcfinalvcCMAvcgivenvctovcthevcseller?
A)
Highestvcandvcbestvcusevcevaluation
vcB)
Comparablevcsalesvcanalysis
vcC)
Adjustmentsvctovcpastvcsales
vcD)
Picturesvcofvccomparablesvc-vcanswer--A)
Thevcanswervcisvchighestvcandvcbestvcusevcevaluation.vcAnvcapprai
servcdoesvcavchighestvcandvcbestvcusevcevaluation,vcwhichvcdoesvcn
otvcappearvcinvcavcCMA.
Housesvcinvcthevclocalvcareavchavevchadvcanvcincreasevcinvcsalesvcpr
icevcandvcavcdecreasevcinvcdaysvconvcthevcmarket.vcAvcbrokervcwhovc
isvcattemptingvctovcdeterminevcthevccurrentvcmarketvcvaluevcforvcavcr
esidentialvclistingvcwouldvcgetvcthevcBESTvcestimatevcofvcvaluevcbyvc
using
A)
avcGRMvcasvcthevcprimaryvcconsiderationvctovcdeterminevcvalue.
vcB)
thevccostvcapproachvcwithvcreproductionvcestimates.
vcC)
comparablesvcthatvcarevcnovcmorevcthanvcsixvcmonthsvcold.
vcD)
about:blan 1/
k 45
,12/20/23,vc7:43 TestvcBankvcForvcAdvancedvcPhysiologyvcandvcPathophysiologyvcEs
vcPM sentialsvcforvcC…
comparablesvcthatvcarevcnovcmorevcthanvc12vcmonthsvcold.vc-
vcanswer--C)
Thevcanswervcisvccomparablesvcthatvcarevcnovcmorevcthanvcsixvcmo
nthsvcold.vcInvcavcchangingvcmarket,vcthevcmorevcrecentvcthevccomp
arables,vcthevcmorevclikelyvctheyvcarevctovcreflectvcupwardvcorvcdow
nwardvcpricevcchanges.
Rentalvcratesvchavevcincreasedvcbyvc2%vcinvcthevclastvcsixvcmonths.
vcWhichvcappraisalvcprinciplevcBESTvcexplainsvcthisvcratevcincreas
e?
A)
Principlevcofvcsubstitution
vcB)
Principlevcofvcsupplyvcandvcdemand
vcC)
Principlevcofvccontribution
vcD)
Principlevcofvchighestvcandvcbestvcusevc-vcanswer--B)
Thevcanswervcisvcprinciplevcofvcsupplyvcandvcdemand.vcThevcprincip
levcofvcsupplyvcandvcdemandvcstatesvcthatvcasvcfewervcpropertiesvcb
ecomevcavailablevcforvcrentvcorvcsale,vcthevcpricevcownersvccanvccha
rgevcwillvcincrease.
ThevccurrentvcmonthlyvcGRMvcinvcavcneighborhoodvcisvc200,vcandvct
hevcannualvcincomevcisvc$24,000.vcWhatvcisvcthevcestimatedvcvaluev
cofvcavcpropertyvcinvcthisvcneighborhood?
A)
$200,000
vcB)
$240,000
vcC)
$400,000
vcD)
$4,800,000vc-vcanswer--C)
about:blan 2/
k 45
,12/20/23,vc7:43 TestvcBankvcForvcAdvancedvcPhysiologyvcandvcPathophysiologyvcEs
vcPM sentialsvcforvcC…
Thevcanswervcisvc$400,000.vcMonthlyvcGRMvc×vcmonthlyvcincomevc
=vcvalue.vc200vc×vc2,000vc($24,000vc÷vc12)vc=vc$400,000.
Thevcsubjectvcpropertyvchasvctwovcbathsvcandvconevcfireplace.vcThe
vcpropertyvcacrossvcthevcstreetvcsoldvcforvc$181,000vcandvchasvctwov
cbathsvcandvctwovcfireplaces.vcThevcpropertyvcbehindvcthevcsubjectv
csoldvcforvc$175,000vcandvchasvctwovcbathsvcandvcnovcfireplace.vcInvc
thevcarea,vcbathsvcarevcworthvc$5,000vcandvcfireplacesvcarevcworthv
c$3,000.vcWhatvcisvcthevcsubjectvcpropertyvcworth?
A)
$175,000
vcB)
$177,000
vcC)
$178,000
vcD)
$180,000vc-vcanswer--Thevcanswervcisvc$178,000vc
SubjectvcPropertyvcCompvc1vc$181,000vcCompvc2vc$175,000
2vcbathsvc2vcbathsvcnovcadjustmentvc2vcbathsvcnovcadjustment
1vcfireplacevc2vcfireplacesvc-vc$3,000vcNovcfireplacevc+vc$3,000
Adjustedvcpricevc$178,000vcAdjustedvcpricevc$178,000
Accordingvctovcfederalvcgovernmentvclendingvcregulations,vcavcbuy
ervcpurchasingvcavchomevcmustvchavevcanvcappraisalvcforvcallvcthevcf
ollowingvctypesvcofvcfinancingvcEXCEPT
A)
FHA.
vcB)
VA.
vcC)
loanvcsoldvctovcFNMA.
vcD)
sellervccarry.vc-vcanswer--D)
Thevcanswervcisvcsellervccarry.vcAllvcgovernmentvcloansvcandvcanyvc
soldvconvcthevcsecondaryvcmarketvcrequirevcanvcappraisal.vcAvcselle
about:blan 3/
k 45
, 12/20/23,vc7:43 TestvcBankvcForvcAdvancedvcPhysiologyvcandvcPathophysiologyvcEs
vcPM sentialsvcforvcC…
r-
carryvcloan,vcorvcsellervcfinancing,vcmayvcorvcmayvcnotvcrequirevcanvc
appraisal.
AvcbuyervcchoosesvcavcloanvcwithvcanvcLTVvcratiovcofvc90%,vcwhichvc
requiresvcthevcpurchasevcofvcPMI,vcinsteadvcofvcavcloanvcwithvcanvc8
0%vcLTV,vcwhichvcwouldvcnotvcrequirevcthevcinsurance.vcThevcbuye
rvcMOSTvclikelyvcmadevcthisvcchoicevcbecause
A)
ifvcthevcbuyervcdefaults,vcPMIvcwillvcprotectvcthevcbuyervcbyvcpayingvc
offvcthevcfullvcloan.
vcB)
thevcbuyervcwillvcmakevcavclargervcdownvcpaymentvcbutvchavevcsmal
lervcmonthlyvcpayments,vcincludingvcPMI.
vcC)
payingvcPMIvcwillvcmeanvcthatvcallvcmortgagevcpaymentsvcandvcho
meownersvcassociationvcfeesvcarevcdeferredvcinvccasevcofvcdefault.
vcD)
thevcbuyervcwantsvcavcsmallervcdownvcpayment,vcevenvcthoughvcth
evcbuyervcwillvchavevctovcpayvcPMI.vc-vcanswer--D)
Thevcanswervcisvcthevcbuyervcwantsvcavcsmallervcdownvcpayment,vc
evenvcthoughvcthevcbuyervcwillvchavevctovcpayvcPMI.vcBuyersvcarevc
willingvctovcpayvcPMIvc(privatevcmortgagevcinsurance)vcinvcordervctov
cbringvcavcsmallervcdownvcpaymentvctovcclosing,vcwhichvcwillvcmean
vcavchighervcmonthlyvcpayment.vcPMIvcprotectsvclendersvcinvccasevc
ofvcdefault.
Avcbuyervcisvcgettingvcavcnewvcmortgagevcwithvcavc95%vcloan-to-
valuevcratio.vcThevcfinalvcloanvcamountvcthevclendervcwillvclendvcthevc
buyervcisvcdeterminedvcbyvcthe
A)
lowervcofvcthevcsalesvcpricevcorvcappraisedvcvalue.
vcB)
highervcofvcthevcsalesvcpricevcorvcappraisedvcvalue.
vcC)
salesvcpricevconly.
about:blan 4/
k 45
