End of Chapter 22 Questions and Answers

End of Chapter 22 Questions and Answers - End of Chapter 22...

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End of Chapter 22 Questions and Answers 1. What does NAR stand for? What is the difference between a broker, agent and REALTOR? Answer: NAR stands for the National Association of REALTORS®, a trade association made up primarily of licensed real estate agents. A broker is licensed to work independently while an agent is required to work under the supervision of a broker. An agent must be licensed within the state in which they work but need not be a REALTOR. 2. How can an agent calculate what a buyer can afford? Describe the factors to consider. Answer: Typically mortgage lenders prefer to see that no more than 25% of gross household income be needed for mortgage payments, and no more than 28% of gross household income be needed for mortgage payments plus property tax and property insurance payments. An agent can questions about income to see how much mortgage a household can afford and then ask about net worth or liquid assets to see how much down payment is available. Within reasonable loan to value ratios the agent can then estimate the total affordable price based on the sum of a supportable mortgage and the down payment less closing costs or other up front costs such as repairs. 3.
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This note was uploaded on 02/07/2012 for the course FIN 4380 taught by Professor Staff during the Spring '08 term at Texas State.

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End of Chapter 22 Questions and Answers - End of Chapter 22...

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