medium · National Real Estate Exam
A buyer purchases a home for $200,000 that appraised for $190,000.
If the buyer makes a $38,000 down payment, will the lender likely require private mortgage insurance (PMI)?
- Yes, because the loan-to-value ratio is based on the appraised value, resulting in an 80% ratio.
- Yes, because the loan-to-value ratio exceeds 80% of the appraised value.
- No, because private mortgage insurance is only required for government-backed loans like FHA.
- No, because the down payment is exactly 20% of the purchase price.
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