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!

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What will a buyer seek from a mortgage lender to ensure they can purchase a house upon completion?

A standby commitment
A full payment upfront
A construction loan
A down payment

The correct answer is: A standby commitment

A buyer will seek a standby commitment from a mortgage lender to ensure they can purchase a house upon completion. This is because a standby commitment is a written assurance from the lender that they will provide a loan for the purchase of the house when it is completed. This option is more beneficial for the buyer compared to the other options provided. Option B and option C (full payment upfront and construction loan) are not feasible for most buyers as they require a large lump sum payment at once, which may not be affordable. Option D (down payment) is also not as useful as a standby commitment as it only covers a portion of the total cost of the house, leaving the buyer to find alternative sources for the remaining amount. A standby commitment, on the other hand, provides assurance for the full purchase price of the house.