• 50 questions

Real Estate Finance Practice Test

Pick an answer to see the right choice and the federal rule or agency page behind it.

How old must a homeowner be to take out a Home Equity Conversion Mortgage, the most common reverse mortgage?

Pick an answer, then press Check answer. Then you see Correct or Not quite, with the reason. Keys: A to D pick, Enter checks.

Print covers the next 25 questions. Share this set copies a link to the same questions in the same order.

Exam mode: 25 questions, no time limit.

More options

Unofficial practice questions, not affiliated with any real estate commission, school or testing company. Bank checked October 9, 2026.

Next step State license law, one question bank per state

All 50 questions

Kinds of loans 14

  • During the interest-only period of an interest-only mortgage, what happens to the amount owed? CFPB, What is an interest-only loan?
  • How old must a homeowner be to take out a Home Equity Conversion Mortgage, the most common reverse mortgage? CFPB, What is a reverse mortgage?
  • In an FHA loan, what does the Federal Housing Administration do? CFPB, What is an FHA loan?
  • On an adjustable-rate mortgage, what is the margin? CFPB, fixed-rate and adjustable-rate mortgage loans
  • What do Fannie Mae and Freddie Mac do for most of the mortgages made in the U.S.? CFPB, What are Fannie Mae and Freddie Mac?
  • What does a Certificate of Eligibility show a lender? VA, VA-backed Veterans home loans
  • What is a balloon payment on a mortgage? CFPB, What is a balloon payment?
  • What is a conventional loan? CFPB, What is a conventional loan?
  • What is negative amortization? CFPB, What is negative amortization?
  • What is the VA funding fee? VA, VA funding fee and loan closing costs
  • Who bears the cost of the mortgage insurance on an FHA loan? CFPB, What is an FHA loan?
  • Whom do the mortgage programs of the USDA's Rural Housing Service help? CFPB, What is a USDA Rural Housing Service loan?
  • Why is a second mortgage called "second"? CFPB, What is a second mortgage loan or junior-lien?
  • With a VA-backed home loan, what does the VA do? VA, VA home loan types
Show all 50 questions (36 more)

Loan terms and costs 10

  • How is a debt-to-income ratio worked out? CFPB, What is a debt-to-income ratio?
  • What do lender credits do? CFPB, lender credits and points
  • What does paying discount points do? CFPB, lender credits and points
  • What does the loan-to-value ratio compare? CFPB, What is a loan-to-value ratio?
  • What is a prepayment penalty? CFPB, What is a prepayment penalty?
  • When does a borrower gain the right to ask the servicer to cancel PMI? CFPB, When can I remove private mortgage insurance (PMI) from my loan?
  • When might a borrower be required to buy private mortgage insurance? CFPB, What is private mortgage insurance?
  • When must a servicer end PMI automatically for a borrower who is current on payments? CFPB, When can I remove private mortgage insurance (PMI) from my loan?
  • Whom does private mortgage insurance protect if the borrower stops making payments? CFPB, What is private mortgage insurance?
  • Why is a mortgage's APR usually higher than its interest rate? CFPB, mortgage interest rate and APR

Disclosures and settlement rules 14

  • A real estate broker owns part of a title company and refers a buyer to it. What must the broker give the buyer under 12 CFR 1024.15? 12 CFR 1024.15(b)(1), eCFR text dated 2026-10-01
  • A title company offers a real estate agent $200 for each buyer the agent sends to it. What does 12 CFR 1024.14 say? 12 CFR 1024.14(b), eCFR text dated 2026-10-01
  • As a general rule, how close must a disclosed annual percentage rate be to the true rate to be considered accurate? 12 CFR 1026.22(a)(2), eCFR text dated 2026-10-01
  • As a general rule, how delinquent must a mortgage be before the servicer may make the first notice or filing for foreclosure? 12 CFR 1024.41(f)(1), eCFR text dated 2026-10-01
  • By when must a creditor deliver or mail the Loan Estimate? 12 CFR 1026.19(e)(1)(iii), eCFR text dated 2026-10-01
  • Does the right to rescind under 12 CFR 1026.23 apply to a loan that finances the purchase of the borrower's principal dwelling? 12 CFR 1026.23(f)(1), eCFR text dated 2026-10-01
  • For which of these loans does a borrower receive no Loan Estimate? CFPB, What is a Loan Estimate?
  • How long before consummation must the consumer receive the Closing Disclosure? 12 CFR 1026.19(f)(1)(ii), eCFR text dated 2026-10-01
  • How many pages is the Closing Disclosure form? CFPB, What is a Closing Disclosure?
  • In a sale, who provides the seller with the closing disclosures for the seller's side of the transaction? 12 CFR 1026.19(f)(4), eCFR text dated 2026-10-01
  • Under the general definition in 12 CFR 1026.43(e)(2), which of these may a qualified mortgage's regular payments not do? 12 CFR 1026.43(e)(2)(i), eCFR text dated 2026-10-01
  • What is the longest loan term a qualified mortgage may have under 12 CFR 1026.43(e)(2)? 12 CFR 1026.43(e)(2)(ii), eCFR text dated 2026-10-01
  • Which of these is a settlement service under Regulation X? 12 CFR 1024.2(b), eCFR text dated 2026-10-01
  • Which payment does 12 CFR 1024.14(g) list as permitted under section 8 of RESPA? 12 CFR 1024.14(g)(1)(v), eCFR text dated 2026-10-01

Fair lending 4

  • An applicant qualifies for a loan under the creditor's standards on her own. May the creditor require her spouse to sign the credit instrument? 12 CFR 1002.7(d)(1), eCFR text dated 2026-10-01
  • An applicant relies on child support payments in applying for a mortgage. How must the creditor treat them? 12 CFR 1002.6(b)(5), eCFR text dated 2026-10-01
  • Which of these is a prohibited basis under Regulation B? 12 CFR 1002.2(z), eCFR text dated 2026-10-01
  • Which question may a creditor not ask a mortgage applicant under 12 CFR 1002.5(d)? 12 CFR 1002.5(d)(3), eCFR text dated 2026-10-01

Loan arithmetic 8

  • A borrower pays $1,600 a month on a mortgage, $300 on a car loan and $200 on other debts, and earns $6,000 a month before taxes. What is the debt-to-income ratio? CFPB, What is a debt-to-income ratio?
  • A borrower pays 1.5 points on a $280,000 loan. How much is that? CFPB, lender credits and points
  • A home appraises at $300,000 and the buyer finances $240,000. What is the loan-to-value ratio? CFPB, What is a loan-to-value ratio?
  • A home appraises at its $400,000 price and the buyer puts $60,000 down. What is the loan-to-value ratio? CFPB, What is a loan-to-value ratio?
  • A home's original value is $250,000. At what scheduled principal balance may the borrower first ask to cancel PMI? CFPB, When can I remove private mortgage insurance (PMI) from my loan?
  • A home's original value is $300,000 and the borrower is current. At what scheduled principal balance must PMI end automatically? CFPB, When can I remove private mortgage insurance (PMI) from my loan?
  • A loan falls in the tier of 12 CFR 1026.43(e)(3) where a qualified mortgage's points and fees may not exceed 3 percent of the total loan amount. The total loan amount is $200,000. What is the limit? 12 CFR 1026.43(e)(3)(i)(A), eCFR text dated 2026-10-01
  • A servicer expects to pay $4,800 a year from an escrow account for taxes and insurance. What is the largest cushion it may charge when the account is created? 12 CFR 1024.17(c)(1)(i), eCFR text dated 2026-10-01

How this list was compiled: Our own questions from three kinds of federal source, all read 2026-10-09. Rules: Title 12 of the Code of Federal Regulations as shown on the eCFR (https://www.ecfr.gov/current/title-12, text dated 2026-10-01), part 1026 (Regulation Z, truth in lending), part 1024 (Regulation X, real estate settlement procedures) and part 1002 (Regulation B, equal credit opportunity). Loan kinds and terms: the Consumer Financial Protection Bureau's Ask CFPB mortgage answers (https://www.consumerfinance.gov/ask-cfpb/). VA loans: the Department of Veterans Affairs home loan pages (https://www.va.gov/housing-assistance/home-loans/). Each question names the section or page its answer was read from and links to it. Licence: Questions, choices and explanations are original work of this site. The regulations and agency pages they describe are works of the United States Government.

How it works

This unofficial real estate finance practice test has 50 questions of our own on the finance unit of a real estate license course. Each explanation names its federal source.

Read the full guide

What the five topics hold

Kinds of loans covers conventional, FHA, VA, USDA, adjustable-rate, balloon, interest-only and reverse loans. Loan terms and costs covers PMI, points, APR and the two ratios lenders use. The rules topic covers the Loan Estimate, the Closing Disclosure, the RESPA ban on referral fees and qualified mortgages. Fair lending is Regulation B. Loan arithmetic works loan-to-value, points, debt-to-income, PMI and escrow problems.

What is left out

State law on mortgages, deeds of trust, liens and foreclosure differs by state and is not here. The page says what a rule means, never what to borrow.

  • Three business days, twice: the Loan Estimate after an application, the Closing Disclosure before consummation (12 CFR 1026.19).
  • PMI: the borrower may ask at 80 percent of original value, and it ends automatically at 78 percent (CFPB).
  • One point is one percent of the loan amount, not of the price (CFPB).

Questions and answers

What is on a real estate finance test?

This page asks 50 questions: 14 on kinds of loans, 10 on loan terms and costs, 14 on federal disclosure and settlement rules, 4 on fair lending and 8 on loan arithmetic. Your own course or exam outline sets the real list.

What is the difference between FHA, VA and conventional loans?

The FHA insures loans made by approved lenders, and the VA guarantees a portion of a private lender's loan to an eligible Veteran or service member. A conventional loan is any mortgage the government neither insures nor guarantees (CFPB, VA).

Is real estate finance the same as real estate math?

No. Finance is mostly loan kinds and lending rules, with some loan arithmetic. Area, commission, proration and property tax problems are on the real estate math practice test.

Are these questions from a real exam?

No. Each was written for this page from federal regulations and agency pages, and none comes from a licensing exam, a school or a prep book. The page is not affiliated with any commission, school or testing company.

More tests

Show 7 more

Browse Civics and Law