Certified Residential Appraiser Practice Exam

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Study for the Certified Residential Appraiser Exam. Use flashcards and multiple choice questions with hints and explanations. Ensure you're ready for your certification!

Practice this question and more.

If a buyer gets a 95% loan for a home priced at $130,000, what will the down payment be?

$4,500
$6,500
$9,500
$12,500

The correct answer is: $6,500

To determine the down payment when a buyer secures a 95% loan on a home priced at $130,000, start by calculating the loan amount. A 95% loan means the buyer finances 95% of the home's value through the loan. First, calculate the loan amount: Loan Amount = 95% of $130,000 = 0.95 × $130,000 = $123,500. Next, to find the down payment, subtract the loan amount from the total home price: Down Payment = Total Home Price - Loan Amount Down Payment = $130,000 - $123,500 = $6,500. Hence, the down payment that the buyer is required to make on a home priced at $130,000 with a 95% loan is $6,500. This amount represents 5% of the home's price, which is the portion not covered by the loan.