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National PSI Exam Prep QUESTIONS & ANSWERS
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National PSI Exam Prep QUESTIONS & ANSWERS
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National PSI Exam Prep1. 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?
A) Highest and best use evaluation
B) Comparable sales analysis
C) Adjustments to past sales
D) Pictures of comparables: A
2. 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) a GRM as the primary consideration to determine value.
B) the cost approach with reproduction estimates.
C) comparables that are no more than six months old.
D) comparables that are no more than 12 months old.: C
3. Rental rates have increased by 2% in the last six months.
Which appraisal principle BEST explains this rate increase?
,A) Principle of substitution
B) Principle of supply and demand
C) Principle of contribution
D) Principle of highest and best use: B
4. 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?
A) $200,000
B) $240,000
C) $400,000
D) $4,800,000: C
5. 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?
A) $175,000
B) $177,000
,C) $178,000
D) $180,000: C
6. According to federal government lending regulations, a
buyer purchasing a home must have an appraisal for all the
following types of financing EXCEPT
A) FHA.
B) VA.
C) loan sold to FNMA.
D) seller carry.: D
7. 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
A) if the buyer defaults, PMI will protect the buyer by paying off
the full loan.
B) the buyer will make a larger down payment but have
smaller monthly payments, including PMI.
C) paying PMI will mean that all mortgage payments and
homeowners asso- ciation fees are deferred in case of default.
D) the buyer wants a smaller down payment, even though the
buyer will have to pay PMI.: D
8. 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
A) lower of the sales price or appraised value.
B) higher of the sales price or appraised value.
C) sales price only.
D) appraised value only.: A
9. The difference between using a partially amortized loan or
an interest-only term loan is that the partially amortized loan
would result in
A) smaller payments and a smaller balloon payment.
B) larger payments and a smaller balloon payment.
C) smaller payments and a larger balloon payment.
D) larger payments and a larger balloon payment.: B
10. A borrower is using leverage on a new home loan at 90%
loan to value. The disadvantage of this type of leveraging is
that
A) the borrower is at higher risk of defaulting on the loan.
B) it allows the borrower to pay less interest over the life of the
loan.
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