NATIONAL PSI EXAM PREP 2023-2024 ACTUAL
EXAM QUESTIONS WITH DETAILED VERIFIED
ANSWERS (100% CORRECT) /A+ GRADE ASSURED
A broker is completing a CMA to determine the potential listing price of a seller's home.
Which of the following is NOT part of the final CMA given to the seller?
• Highest and best use evaluation
• Comparable sales analysis
• Adjustments to past sales
• Pictures of comparables ✔✔A
Houses in the local area have had an increase in sales price and a decrease in days on the
market. A broker who is attempting to determine the current market value for a residential
listing would get the BEST estimate of value by using
• a GRM as the primary consideration to determine value.
• the cost approach with reproduction estimates.
• comparables that are no more than six months old.
• comparables that are no more than 12 months old. ✔✔C
,Rental rates have increased by 2% in the last six months. Which appraisal principle BEST
explains this rate increase?
• Principle of substitution
• Principle of supply and demand
• Principle of contribution
• Principle of highest and best use ✔✔B
The current monthly GRM in a neighborhood is 200, and the annual income is $24,000. What
is the estimated value of a property in this neighborhood?
• $200,000
• $240,000
• $400,000
• $4,800,000 ✔✔C
The subject property has two baths and one fireplace. The property across the street sold for
$181,000 and has two baths and two fireplaces. The property behind the subject sold for
,$175,000 and has two baths and no fireplace. In the area, baths are worth $5,000 and
fireplaces are worth $3,000. What is the subject property worth?
• $175,000
• $177,000
• $178,000
• $180,000 ✔✔C
According to federal government lending regulations, a buyer purchasing a home must have
an appraisal for all the following types of financing EXCEPT
• FHA.
• VA.
• loan sold to FNMA.
• seller carry. ✔✔D
A buyer chooses a loan with an LTV ratio of 90%, which requires the purchase of PMI,
instead of a loan with an 80% LTV, which would not require the insurance. The buyer
MOST likely made this choice because
, • if the buyer defaults, PMI will protect the buyer by paying off the full loan.
• the buyer will make a larger down payment but have smaller monthly payments,
including PMI.
• paying PMI will mean that all mortgage payments and homeowners association fees
are deferred in case of default.
• the buyer wants a smaller down payment, even though the buyer will have to pay PMI.
✔✔D
A buyer is getting a new mortgage with a 95% loan-to-value ratio. The final loan amount the
lender will lend the buyer is determined by the
• lower of the sales price or appraised value.
• higher of the sales price or appraised value.
• sales price only.
• appraised value only. ✔✔A
The difference between using a partially amortized loan or an interest-only term loan is that
the partially amortized loan would result in
EXAM QUESTIONS WITH DETAILED VERIFIED
ANSWERS (100% CORRECT) /A+ GRADE ASSURED
A broker is completing a CMA to determine the potential listing price of a seller's home.
Which of the following is NOT part of the final CMA given to the seller?
• Highest and best use evaluation
• Comparable sales analysis
• Adjustments to past sales
• Pictures of comparables ✔✔A
Houses in the local area have had an increase in sales price and a decrease in days on the
market. A broker who is attempting to determine the current market value for a residential
listing would get the BEST estimate of value by using
• a GRM as the primary consideration to determine value.
• the cost approach with reproduction estimates.
• comparables that are no more than six months old.
• comparables that are no more than 12 months old. ✔✔C
,Rental rates have increased by 2% in the last six months. Which appraisal principle BEST
explains this rate increase?
• Principle of substitution
• Principle of supply and demand
• Principle of contribution
• Principle of highest and best use ✔✔B
The current monthly GRM in a neighborhood is 200, and the annual income is $24,000. What
is the estimated value of a property in this neighborhood?
• $200,000
• $240,000
• $400,000
• $4,800,000 ✔✔C
The subject property has two baths and one fireplace. The property across the street sold for
$181,000 and has two baths and two fireplaces. The property behind the subject sold for
,$175,000 and has two baths and no fireplace. In the area, baths are worth $5,000 and
fireplaces are worth $3,000. What is the subject property worth?
• $175,000
• $177,000
• $178,000
• $180,000 ✔✔C
According to federal government lending regulations, a buyer purchasing a home must have
an appraisal for all the following types of financing EXCEPT
• FHA.
• VA.
• loan sold to FNMA.
• seller carry. ✔✔D
A buyer chooses a loan with an LTV ratio of 90%, which requires the purchase of PMI,
instead of a loan with an 80% LTV, which would not require the insurance. The buyer
MOST likely made this choice because
, • if the buyer defaults, PMI will protect the buyer by paying off the full loan.
• the buyer will make a larger down payment but have smaller monthly payments,
including PMI.
• paying PMI will mean that all mortgage payments and homeowners association fees
are deferred in case of default.
• the buyer wants a smaller down payment, even though the buyer will have to pay PMI.
✔✔D
A buyer is getting a new mortgage with a 95% loan-to-value ratio. The final loan amount the
lender will lend the buyer is determined by the
• lower of the sales price or appraised value.
• higher of the sales price or appraised value.
• sales price only.
• appraised value only. ✔✔A
The difference between using a partially amortized loan or an interest-only term loan is that
the partially amortized loan would result in
