California Real Estate Practice Exam

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Study for the California Real Estate Exam with confidence. Engage with interactive questions designed to enhance your understanding of real estate principles, laws, and practices. Prepare thoroughly for your licensing test and ensure you have the knowledge to succeed in your real estate career!

Practice this question and more.

If a buyer secures a mortgage significantly below the prevailing rates, what does this allow them to do?

Pay less interest over the life of the loan
Purchase a more expensive property
Negotiate a better sale price
Avoid property taxes

The correct answer is: Purchase a more expensive property

Securing a mortgage significantly below the prevailing rates allows a buyer to purchase a more expensive property. This is because a lower mortgage rate means lower monthly payments, allowing the buyer to afford a higher-priced property. Option A is incorrect because although the buyer would pay less interest overall, this does not directly correlate to being able to purchase a more expensive property. Option C is incorrect as the sale price is negotiated before the mortgage is secured. Option D is also incorrect as property taxes are determined by the assessed value of the property, not the mortgage rate.