Mortgage Broker Licensing Practice Exam · Question
A client wants to purchase a property for $700,000 and needs to secure a Purchase Plus Improvements mortgage for an additional $75,000 for renovations. The lender will only finance up to 95% of the 'as improved' value, which is appraised at $775,000. What is the maximum mortgage amount the client can obtain for the purchase and improvements?
The maximum mortgage amount for a Purchase Plus Improvements mortgage is calculated based on the 'as improved' value of the property and the maximum allowed Loa
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Question: A client wants to purchase a property for $700,000 and needs to secure a Purchase Plus Improvements mortgage for an additional $75,000 for renovations. The lender will only finance up to 95% of the 'as improved' value, which is appraised at $775,000. What is the maximum mortgage amount the client can obtain for the purchase and improvements?
Answer options:
- A. $665,000 ✅ B. $736,250
- C. $750,000
- D. $775,000
Correct answer: B. $736,250
Explanation: The maximum mortgage amount for a Purchase Plus Improvements mortgage is calculated based on the 'as improved' value of the property and the maximum allowed Loan-to-Value (LTV). Here, the 'as improved' value is $775,000, and the maximum LTV is 95%. So, $775,000 * 0.95 = $736,250.
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Question explanations
- What is the typical time frame for a mortgage agent to provide the required disclosure statement to a client?
- Funds received from a client or investor that the brokerage holds on their behalf must be deposited into:
- Ontario mortgage agents must complete which of the following at each licence renewal?
- Which entity is responsible for licensing and regulating mortgage brokers and agents in Ontario?
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