MRP Financial Analysis for Properties 3

Question 1

Under the Servicemembers Civil Relief Act (SCRA), what is the maximum interest rate a lender can charge on pre-service debts during active duty?

Accepted Answer

6%

Answer

The SCRA caps interest rates on pre-service obligations at 6% per year during active duty military service upon proper written notice.

Question 2

When analyzing a home purchase for a military buyer, which factor is MOST unique to their financial analysis compared to civilian buyers?

Accepted Answer

Potential PCS relocation reducing planned holding period

Answer

Military buyers face unpredictable PCS orders that can force a sale before achieving break-even on buying costs, making holding period analysis critical.

Question 3

A military member's monthly gross income is $5,500. Their proposed housing payment (PITI) is $1,540. What is their housing expense ratio?

Accepted Answer

28%

Answer

Housing expense ratio = $1,540 ÷ $5,500 = 0.28, or 28%, which is within conventional lending guidelines.

Question 4

A service member is considering converting their primary home to a rental upon PCS. Which calculation determines if the rental will cash flow positively?

Accepted Answer

Monthly rent minus PITI and management fees

Answer

Positive cash flow exists when monthly rent exceeds all monthly expenses including mortgage payment, taxes, insurance, and management fees.

Question 5

In VA loan underwriting, what does the residual income requirement primarily assess?

Accepted Answer

Whether sufficient funds remain for family living expenses after all obligations

Answer

VA residual income measures the money left after all monthly debts and shelter expenses, ensuring the veteran's family can meet basic living needs.

(MRP) Military Relocation Professional Practice Test

(MRP) Military Relocation Professional Practice Test

MRP Financial Analysis for Properties 3