MI Real Estate: Calculations TEST

A property purchased for $115,000 had a capitalization rate of 12%. What would be the monthly net income on this property? $ 1,150 $ 3,550 $ 6,220 $13,800

$ 1,150 $115,000 x 12% = $13,800 annual net income / 12 months = $1,150 monthly

Taxes of $1,200 were prepaid for the year on January 1st. If the property was sold with a closing date of March 1st and the buyer was credited with the day of closing, what would be the tax proration? $ 200 $ 500 $ 800 $1,000

$1,000 $1,200 / 360 = $3.33 per day x 300 days = $1,000 (The buyer owes from March through December which is 10 months or 300 days)

A buyer purchased a property for $60,000 putting 15% down and paying two discount points. How much in dollars were the points? $1,020 $1,200 $1,320 $1,500

$1,020 $60,000 x 85% = $51,000 loan x 2% = $1,020.

If salesperson's commission was $594 based on a 40% split, what was the total commission collected by the real estate company? $1,485 $2,970 $990 $1,980

$1,485

A person sold a property for $125,000 which represented an increase of 25% over the original cost. What was the original cost? $93,750 $100,000 $105,500 $112.000

$100,000 $125,000 divided by 125% = $100,000 for original cost

An industrial building sold for $535,000. The listing broker charged a 4.5% commission agreeing to cooperate with other brokers and split the commission 50/50. If a cooperating broker sold the property, how much would each of the brokers receive? $10,535.50 $12,037.50 $24,075.00 $28,975.00

$12,037.50 $535,000 x 4.5% = $24,075 divided by 2 = $12,037.50 for each broker.

A broker sells a property receiving $8,400 by charging a 6% commission. What was the sale price? $140,000 $157,000 $182,000 $302,000

$140,000 $8,400 \ 6% = $140,000

Property tax of $4,660/yr. paid in advance based on exact days method (calendar year). The seller stayed 6 months and sold the property. what is the proration at closing? $2,330 Credit Buyer / Debit Seller $2,330 Debit Buyer / Credit Seller $4,600 Debit Buyer / Credit Seller $4,600 Debit Seller / Credit Buyer

$2,330 Debit Buyer / Credit Seller

Sue and Bill gross $90,000/yr. The lender allows 43% of their income towards PITI. If property tax is $6,000/yr and insurance $1,200/yr. How much of a mortgage payment (P &I) can they afford? $2,625 $3,225 $2,725 $3,125

$2,625

If price is $128,000 and loan to value ratio is 75% with 3 points, how much in points is due at closing ? $2,880 $3,840 $3,280 $1,840

$2,880

A property was sold with a 300-gallon fuel tank being part of the sale. The tank was 2/3 full at closing with a cost of $1.45 per gallon. What would be the proration at closing? $100 $145 $290 $435

$290 300 x 2/3 (300 x 2 / 3) = 200 gallons x $1.45 per gallon = $290

A person bought a rental property for $43,750. It was assessed for tax purposes at a value of $39,950 with an assessment rate of $1.50 per $100 (15 mills). What would be the monthly tax assessment amount to the nearest cent? $44.37 $49.94 $54.69 $59.99

$49.94 $39,950 x 1.5% = $599.25 divided by 12 = $49.94.

Two brokers cooperate to sell a $250,00 house and equally share a 7% commission. The listing salesperson splits commissions with her broker based on 65 - 35 in favor of the salesperson. How much commission does the salesperson receive? $11,375 $5,687.50 $8,750 $3,062.50

$5,687.50

What is the total depreciation deduction on residential income property purchased for $165.00 including land valued at 20% of the total price if the law requires residential income property to be depreciated over 27.5 years and the owner kept the property for 11 years ? $99,000 $66,000 $52,800 $79,200

$52,800

Loan amount $60,000 with 4% annual interest. Monthly payment is $300/m, what is the balance upon making the first payment? $59,700 $59,800 $59,750 $59,900

$59,900

What would the seller net if the property was sold for $650,000 with a 6.5% commission? $601,350 $607,750 $614,580 $622,300

$607,750 $650,000 x 6.5% = $42,250. $650,000 - $42,250 = $607,750

Property sold for $72,650. Commission 6%. Calculate the transfer tax due to the county and the state? $312.39 $624.79 $627.80 $619.20

$627.80

A property sold for $125,000 with a loan of $50,000. The seller paid $2,000 in closing costs and a 7% commission? How much would the seller net? $54,250 $57,000 $61,300 $64,250

$64,250 $125,000 x 7% = $8,750 in commission. $125,000 - $50,000 - $2,000 - $8,750 = $64,250 net.

A buyer purchased a property for $130,000 putting 20% down. The buyer also immediately took out a $10,000 home equity loan. Five years later, the home has a current value of $175,000 while the home equity loan is down to a balance of $4,500 and the first mortgage has a current balance of $98,000. What is the seller's equity in the property? $61,500 $68,750 $72,500 $98,000

$72,500 $175,000 - $4,500 - $98,000 = $72,500

Taxes on a property were paid in arrears running from July 1st to June 30th. If closing was on April 15th and the annual taxes were $912, what was the tax proration? $191 $437 $721 $912

$721 $912 annual taxes / 360 days = $2.53 per day for taxes x 285 days = $721.

A buyer bought a property for $60,000 which had an appraisal of $58,000. If the lender charged 1 1/2 discount points, with the borrower receiving a 90% loan, how much were the points? $783 $900 $1,200 $1,435

$783 $58,000 x 90% = $52,200 for the loan x 1.5% = $783 for the discount points.

Property Tax $2,646.25 payable in advance (calendar year) but delinquent. Using exact days method what proration is due if closing is scheduled April 28? $848.25 debit seller $848.25 debit buyer $1,798 debit buyer $1,798 debit buyer

$848.25 debit seller

A property with a value of $73,500 had a loan of $72,500. If the mill rate was 1 1/2, what were the monthly taxes? $9.06 $9.19 $9.54 $9.80

$9.19 $73,500 x .15% = $110.25 for yearly taxes / 12 months = $9.19 per month

Quarterly interest due on a $185,000 loan is $2,775. What is the annual interest rate ? 6% 1.5% 3% 2%

6%

A property was purchased for $92,000 putting $11,000 down. A few years later, the property appraised for $116,000 while the loan balance was down to $79,000. What is the owner's equity in the property? $11,000 $25,000 $32,000 None of the above

None of the above $116,000 - $79,000 = $37,000 of equity.