FREE Wisconsin Real Estate License Property Valuation and Financing Questions and Answers Flashcards
6 cards from real Wisconsin Real Estate License practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 FREE Wisconsin Real Estate License Property Valuation and Financing Questions and Answers flashcards as text
Which Wisconsin real estate financing instrument transfers legal title to a trustee until the borrower repays the loan?
Answer: Deed of trust
A deed of trust conveys legal title to a neutral trustee who holds it as security until the borrower satisfies the debt.
When using the sales comparison approach in Wisconsin, an appraiser adjusts the value of which properties?
Answer: Comparable properties
In the sales comparison approach, adjustments are always made to the comparable properties to account for differences from the subject property.
What is the primary purpose of private mortgage insurance (PMI) in a conventional Wisconsin real estate loan?
Answer: To protect the lender against borrower default when the down payment is less than 20%
PMI protects the lender from loss if the borrower defaults, and is typically required when the LTV exceeds 80%.
A Wisconsin appraiser uses a gross rent multiplier (GRM) of 120 on a property with a monthly gross rent of $1,500. What is the estimated property value?
Answer: $180,000
Multiplying the monthly gross rent of $1,500 by the GRM of 120 produces an estimated value of $180,000.
In Wisconsin real estate transactions, what does the term 'equity' refer to?
Answer: The difference between the property's market value and the outstanding mortgage balance
Equity is the owner's financial interest in the property, calculated as market value minus any remaining loan balances.
Which type of loan allows a Wisconsin borrower to draw funds as needed up to a set limit, using the home as collateral?
Answer: Home equity line of credit (HELOC)
A HELOC functions as a revolving credit line secured by the borrower's home equity, allowing withdrawals up to an approved limit.