NMLS MATH QUESTIONS AND ANSWERS A+
GRADED.Buy Quality Materials!
An 80/20 combo loan with the sales price of $175,000, a rate of 6% for the 80%
first mortgage, and a rate of 8.5% for the 20% second mortgage would have a first
mortgage loan amount of what?
C The first mortgage is 80% of the sale price: $175,000 x 80% = $140,000.
A borrower has a stable monthly income of $4,000 and recurring debts of $600. If
he's getting an FHA loan, what's the maximum monthly payment for which he
would qualify?
Using the payment-to-income ratio of 31%, we get $1,240. But using the total debt to
income ratio, we find: $4,000 (income) multiplied by 0.43, which equals $1,720. From
that, you subtract monthly debts of $600, leaving $1,120.
You are pre-qualifying a borrower for a purchase loan. She has debt equaling
$950 each month and gross monthly income totaling $5,200 each month. What is
the maximum qualifying house payment, including principal, interest, taxes and
insurance on a conventional loan?
Two calculations need to be done: $5,200 x 28% = $1,456, then $5,200.00 x 36% =
$1,872 - $950 = $922. Take the lower of the two. If you did not complete both
calculations, you might have allowed Sue to have a payment of $1,456; by the time you
added the debt and divided by the $5,200, your back ratio would be too high ($5,200 x
28% = $1,456 + $950 = $2,406 ÷ $5,200 = 46%).
You are refinancing a $200,000 mortgage with a prepayment penalty of six
months of interest at 6.5%. How much is the prepayment penalty?
Simply multiply the original loan amount by the interest rate for the annual interest, then
divide by 2 to get six months' interest. In this case, $200,000 x 6.5% (0.065) = $13,000;
$13,000 ÷ 2 = $6,500.
A borrower reports income of $40,000 from rental properties. How much of that
should be considered when applying for a mortgage loan?
Income from rental properties should be counted only at 75%; this allows for vacancy
losses.
A borrower is buying a house with a sales price of $200,000 and an LTV of 75%. If
he pays two discount points, what is the total cost of the points?
With an LTV of 75%, the loan for this purchase is $150,000. On a $150,000 loan, a
point costs $1,500 (150,000 x .01), so the borrower is paying $3,000
A homeowner's house appraises for $125,000. He qualifies for an 85% LTV. He
owes $63,000 on his first mortgage and $5,000 on his second mortgage. He would
like to refinance his house into one mortgage loan and receive additional cash to
pay off other debt. How much cash would be available if his closing costs are
$4,200 and are financed in the loan?
A First, determine the maximum loan amount Robby qualifies for: $125,000 x 85% =
$106,250. Now, subtract the current debt and closing costs: $106,250 - $63,000 -
$5,000 - $4,200 = $34,050 cash available.
A borrower who is paid $750 per week has a qualifying monthly income of
GRADED.Buy Quality Materials!
An 80/20 combo loan with the sales price of $175,000, a rate of 6% for the 80%
first mortgage, and a rate of 8.5% for the 20% second mortgage would have a first
mortgage loan amount of what?
C The first mortgage is 80% of the sale price: $175,000 x 80% = $140,000.
A borrower has a stable monthly income of $4,000 and recurring debts of $600. If
he's getting an FHA loan, what's the maximum monthly payment for which he
would qualify?
Using the payment-to-income ratio of 31%, we get $1,240. But using the total debt to
income ratio, we find: $4,000 (income) multiplied by 0.43, which equals $1,720. From
that, you subtract monthly debts of $600, leaving $1,120.
You are pre-qualifying a borrower for a purchase loan. She has debt equaling
$950 each month and gross monthly income totaling $5,200 each month. What is
the maximum qualifying house payment, including principal, interest, taxes and
insurance on a conventional loan?
Two calculations need to be done: $5,200 x 28% = $1,456, then $5,200.00 x 36% =
$1,872 - $950 = $922. Take the lower of the two. If you did not complete both
calculations, you might have allowed Sue to have a payment of $1,456; by the time you
added the debt and divided by the $5,200, your back ratio would be too high ($5,200 x
28% = $1,456 + $950 = $2,406 ÷ $5,200 = 46%).
You are refinancing a $200,000 mortgage with a prepayment penalty of six
months of interest at 6.5%. How much is the prepayment penalty?
Simply multiply the original loan amount by the interest rate for the annual interest, then
divide by 2 to get six months' interest. In this case, $200,000 x 6.5% (0.065) = $13,000;
$13,000 ÷ 2 = $6,500.
A borrower reports income of $40,000 from rental properties. How much of that
should be considered when applying for a mortgage loan?
Income from rental properties should be counted only at 75%; this allows for vacancy
losses.
A borrower is buying a house with a sales price of $200,000 and an LTV of 75%. If
he pays two discount points, what is the total cost of the points?
With an LTV of 75%, the loan for this purchase is $150,000. On a $150,000 loan, a
point costs $1,500 (150,000 x .01), so the borrower is paying $3,000
A homeowner's house appraises for $125,000. He qualifies for an 85% LTV. He
owes $63,000 on his first mortgage and $5,000 on his second mortgage. He would
like to refinance his house into one mortgage loan and receive additional cash to
pay off other debt. How much cash would be available if his closing costs are
$4,200 and are financed in the loan?
A First, determine the maximum loan amount Robby qualifies for: $125,000 x 85% =
$106,250. Now, subtract the current debt and closing costs: $106,250 - $63,000 -
$5,000 - $4,200 = $34,050 cash available.
A borrower who is paid $750 per week has a qualifying monthly income of
