FREE Wisconsin Real Estate License Valuing and Financing Property Questions and Answers

Question 1

An appraiser is valuing a 15-year-old, single-family home in a well-established suburban neighborhood in Wisconsin. Which approach to value would the appraiser most likely give the most weight to?

Accepted Answer

Sales Comparison Approach

Answer

Income Approach

Answer

Cost Approach

Answer

Gross Rent Multiplier Approach

Question 2

A home in Green Bay, Wisconsin sells for $350,750. What is the amount of the Wisconsin Real Estate Transfer Fee (RETF) that must be paid at closing?

Accepted Answer

$1,053.00

Answer

$1,050.00

Answer

$1,052.40

Answer

$350.75

Question 3

A buyer is purchasing a home for $400,000 and obtains a mortgage for $320,000. What is the loan-to-value (LTV) ratio, and what will the lender likely require as a result?

Accepted Answer

80% LTV; the lender will not require private mortgage insurance (PMI).

Answer

75% LTV; the lender will require a higher interest rate.

Answer

85% LTV; the lender will require the buyer to pay discount points.

Answer

90% LTV; the lender will require a co-signer for the loan.

Question 4

When an assessor in Wisconsin is determining the value of a property for tax purposes, which of the following is considered the BEST evidence of the property's value according to state guidelines?

Accepted Answer

A recent, arm's-length sale of the property itself.

Answer

The cost to replace the structure, minus depreciation.

Answer

The property's potential to generate rental income.

Answer

The average sale price of homes in the same zip code.

Question 5

Which of the following is a key difference between the mortgage insurance required for an FHA loan (MIP) and a conventional loan (PMI) for a borrower with a low down payment?

Accepted Answer

FHA MIP typically remains for the life of the loan, while conventional PMI can be cancelled at 80% LTV.

Answer

FHA MIP is paid in a single lump sum, while conventional PMI is paid monthly.

Answer

Conventional PMI protects the borrower, while FHA MIP protects the lender.

Answer

A borrower needs a higher credit score to qualify for FHA MIP than for conventional PMI.

Question 6

An appraiser is using the cost approach to value a property. They have determined the cost to build a similar structure with modern materials and standards. What is this specific cost known as?

Accepted Answer

Replacement Cost

Answer

Reproduction Cost

Answer

Replication Cost

Answer

Substitution Cost

An appraiser is valuing a 15-year-old, single-family home in a well-established suburban neighborhood in Wisconsin.Which approach to value would the appraiser most likely give the most weight to?

An appraiser is valuing a 15-year-old, single-family home in a well-established suburban neighborhood in Wisconsin.
Which approach to value would the appraiser most likely give the most weight to?