PSI New Jersey Real Estate State Practice Exam

Disable ads (and more) with a membership for a one time $2.99 payment

Prepare for the New Jersey Real Estate Exam. Ace your test with comprehensive multiple-choice questions. Each question includes detailed explanations and hints. Start studying today and boost your confidence!

Start Multiple Choice Practice Test
Start Flash Cards

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

What factors do mortgage lenders most often rely on to determine the loan amount for real estate?

  1. Borrower's credit score

  2. Property location

  3. Appraised value of the property

  4. Current market trend

The correct answer is: Appraised value of the property

The appraised value of the property is the key factor that mortgage lenders rely on to determine the loan amount for real estate. An appraisal provides an objective assessment of the property's market value based on a thorough examination of its condition, location, and comparable sales in the area. This value helps the lender understand how much risk they are taking on by granting the loan, as it indicates what they could potentially recover in the event of a foreclosure. While a borrower's credit score is important in assessing their ability to repay the loan, the amount of money a lender is willing to provide primarily hinges on the appraisal to ensure that the loan is adequately secured by the asset itself. Additionally, property location and current market trends can influence the overall assessment of the property’s value, but they do not directly dictate the loan amount as definitively as the appraised value does.

More Questions Like This