PRINCIPLES OF REAL ESTATE 2 (TEXAS)
EXAM WITH 100% CORRECT ANSWERS
2024
Question 1
The borrower pays the lender interest in exchange what?
Correct Answer
Principal
Question 2
With an amortizing loan, mortgage payments are paid how?
Correct Answer
Mortgage payments are structured to gradually pay off both the principal balance and the
interest over the life of the loan. These payments are typically made in equal monthly
installments.
Question 3
Mikayla, a licensed real estate sales agent, helped her client buy a property outside of
Springfield. The listing agreement states that 3% of the sales price will go to the buyer's
agent as commission. Mikayla made $7,500 in commission in the purchase of the home.
For how much did the property sell?
Correct Answer
$250,000
$7,500 / .03 = $250k
Part / % = Total
Question 4
If a buyer makes a 15% down payment and obtains a $200,000 mortgage, what is the sales
price of the property?
Correct Answer
Part / % = Total
200k / .85 = $235,294
Sale price of the property = $235,294
Question 5
Mikayla, a licensed real estate sales agent, helped her client buy a property outside of
Springfield. The listing agreement states that 3% of the sales price will go to the buyer's
agent as commission. The sales price is $250,000. What was Mikayla's commission?
Correct Answer
Total x % = Part
,$250,000 x 0.03 = $7,500
Mikayla's commission was $7,500
Question 6
If a buyer's down payment is $20,000 and they put down $5,000 in earnest money, then how
much money must the buyer put down for the remaining amount on closing day?
Correct Answer
$15,000
($20,000 - $5,000 = $15,000) in cash on closing day.
Question 7
A property is sold for $300,000. The buyer has paid $15,000 as earnest money and is
obtaining an 80% loan. How much additional cash will the buyer have to bring to the closing
day?
Correct Answer
$45,000
1. Determine the loan amount of 80%
Total x % = Part = 300k x .8 = $240k
2. Subtract earnest money and the loan amount from the purchase price = $300k - $240k -
$15k = $45k
Question 8
Kat sold her hone for $340k. Kat's listing agent earned $10,200 in commission from the sale
of the home.
- What % of the sale did the listing agent earn in commission?
Correct Answer
$10,200 / $350k = 3%
Question 9
What term is used to describe the total money gained?
Correct Answer
Profit
Question 10
Lauren has a remaining balance of $300,000 on her house. Her interest rate is 4.15%.
How much interest does Lauren owe for her next mortgage payment?
Correct Answer
Part 1 - Find Annual Interest
1. $300,000 (principal) x 4.15% (interest rate) = Annual interest
,2. $300,000 x 0.0415 = $12,450
3. The annual interest = $12,450
Part 2 - Find Monthly interest
1. $12,450 ÷ 12 = $1,037.50
Final Answer = Next month, Lauren's monthly interest will be $1,037.50
Question 11
Lauren has a remaining balance of $300,000 on her house. Her interest rate is 4.15%. The
annual interest is $12,450. What is Lauren's quarterly interest?
Correct Answer
$12,450 ÷ 4 = $3,112.50
Question 12
What are the 4 characteristics that make real estate valuable
Correct Answer
Demand, utility, scarcity, and transferability
Question 13
If an underwriter is concerned about the accuracy of an appraisal, they might request
what?
Correct Answer
An appraisal review. This review is conducted by another professional (either an
independent or in-house specialist). The underwriter will use the appraised value
found by the reviewer for their underwriting purposes.
Question 14
When appraising a newly constructed building, which approach to value is an appraiser
likely to use?
Correct Answer
Cost Approach
Question 15
In Texas, who regulates appraisers?
Correct Answer
, the Texas Appraiser Licensing & Certification Board, aka TALCB.
Question 16
A _________ Appraiser can only do appraisals of One-to-four family non-complex residential
units where the transactions are valued at less than $1,000,000
Correct Answer
A Licensed Residential Appraiser
Question 17
An appraiser with 24 to 29 months' experience, who can do appraisals, regardless of property
value, in one-to-four residential unit transactions is a _________ Appraiser.
Correct Answer
Certified Residential Appraiser
Question 18
A ______________ Appraiser can appraise any kind of property, anywhere, anytime, anyhow.
Correct Answer
A Certified General Appraiser
Question 19
What is the very first part of the appraisal process?
Correct Answer
Stating the full legal description of the property
Question 20
In real estate transactions involving financing, to whom does the appraiser send the final
appraisal?
Correct Answer
The lender. The appraisal will then be reviewed by the underwriter to make sure it was done
properly, and it will be checked to ensure it meets the lender's standards.
Question 21
What does "DUST" Stand for
Correct Answer
Demand
Utility
Scarcity
Transferability
Question 22
The sales comparison approach uses what two value principles.
Correct Answer
Substitution and contribution
EXAM WITH 100% CORRECT ANSWERS
2024
Question 1
The borrower pays the lender interest in exchange what?
Correct Answer
Principal
Question 2
With an amortizing loan, mortgage payments are paid how?
Correct Answer
Mortgage payments are structured to gradually pay off both the principal balance and the
interest over the life of the loan. These payments are typically made in equal monthly
installments.
Question 3
Mikayla, a licensed real estate sales agent, helped her client buy a property outside of
Springfield. The listing agreement states that 3% of the sales price will go to the buyer's
agent as commission. Mikayla made $7,500 in commission in the purchase of the home.
For how much did the property sell?
Correct Answer
$250,000
$7,500 / .03 = $250k
Part / % = Total
Question 4
If a buyer makes a 15% down payment and obtains a $200,000 mortgage, what is the sales
price of the property?
Correct Answer
Part / % = Total
200k / .85 = $235,294
Sale price of the property = $235,294
Question 5
Mikayla, a licensed real estate sales agent, helped her client buy a property outside of
Springfield. The listing agreement states that 3% of the sales price will go to the buyer's
agent as commission. The sales price is $250,000. What was Mikayla's commission?
Correct Answer
Total x % = Part
,$250,000 x 0.03 = $7,500
Mikayla's commission was $7,500
Question 6
If a buyer's down payment is $20,000 and they put down $5,000 in earnest money, then how
much money must the buyer put down for the remaining amount on closing day?
Correct Answer
$15,000
($20,000 - $5,000 = $15,000) in cash on closing day.
Question 7
A property is sold for $300,000. The buyer has paid $15,000 as earnest money and is
obtaining an 80% loan. How much additional cash will the buyer have to bring to the closing
day?
Correct Answer
$45,000
1. Determine the loan amount of 80%
Total x % = Part = 300k x .8 = $240k
2. Subtract earnest money and the loan amount from the purchase price = $300k - $240k -
$15k = $45k
Question 8
Kat sold her hone for $340k. Kat's listing agent earned $10,200 in commission from the sale
of the home.
- What % of the sale did the listing agent earn in commission?
Correct Answer
$10,200 / $350k = 3%
Question 9
What term is used to describe the total money gained?
Correct Answer
Profit
Question 10
Lauren has a remaining balance of $300,000 on her house. Her interest rate is 4.15%.
How much interest does Lauren owe for her next mortgage payment?
Correct Answer
Part 1 - Find Annual Interest
1. $300,000 (principal) x 4.15% (interest rate) = Annual interest
,2. $300,000 x 0.0415 = $12,450
3. The annual interest = $12,450
Part 2 - Find Monthly interest
1. $12,450 ÷ 12 = $1,037.50
Final Answer = Next month, Lauren's monthly interest will be $1,037.50
Question 11
Lauren has a remaining balance of $300,000 on her house. Her interest rate is 4.15%. The
annual interest is $12,450. What is Lauren's quarterly interest?
Correct Answer
$12,450 ÷ 4 = $3,112.50
Question 12
What are the 4 characteristics that make real estate valuable
Correct Answer
Demand, utility, scarcity, and transferability
Question 13
If an underwriter is concerned about the accuracy of an appraisal, they might request
what?
Correct Answer
An appraisal review. This review is conducted by another professional (either an
independent or in-house specialist). The underwriter will use the appraised value
found by the reviewer for their underwriting purposes.
Question 14
When appraising a newly constructed building, which approach to value is an appraiser
likely to use?
Correct Answer
Cost Approach
Question 15
In Texas, who regulates appraisers?
Correct Answer
, the Texas Appraiser Licensing & Certification Board, aka TALCB.
Question 16
A _________ Appraiser can only do appraisals of One-to-four family non-complex residential
units where the transactions are valued at less than $1,000,000
Correct Answer
A Licensed Residential Appraiser
Question 17
An appraiser with 24 to 29 months' experience, who can do appraisals, regardless of property
value, in one-to-four residential unit transactions is a _________ Appraiser.
Correct Answer
Certified Residential Appraiser
Question 18
A ______________ Appraiser can appraise any kind of property, anywhere, anytime, anyhow.
Correct Answer
A Certified General Appraiser
Question 19
What is the very first part of the appraisal process?
Correct Answer
Stating the full legal description of the property
Question 20
In real estate transactions involving financing, to whom does the appraiser send the final
appraisal?
Correct Answer
The lender. The appraisal will then be reviewed by the underwriter to make sure it was done
properly, and it will be checked to ensure it meets the lender's standards.
Question 21
What does "DUST" Stand for
Correct Answer
Demand
Utility
Scarcity
Transferability
Question 22
The sales comparison approach uses what two value principles.
Correct Answer
Substitution and contribution
