LTV = loan ÷ value; down % = 100% − LTV%
Before you read
Test yourself first: 5 questions
Question 1 of 5
A buyer pays $2,100 monthly interest-only on a 7% loan. The loan amount is:
Answer: B. Annual interest = 2,100 × 12 = $25,200. Principal = 25,200 ÷ 0.07 = $360,000.
Question 2 of 5
What is the annual simple interest on a $120,000 loan at 5%?
Answer: A. $120,000 × 0.05 = $6,000 per year.
Question 3 of 5
How much do 2 discount points cost on a $200,000 loan?
Answer: A. 1 point = 1% of the loan. 2% × $200,000 = $4,000.
Question 4 of 5
On a $100,000 loan at 6% annual interest, how much of the first monthly payment is interest?
Answer: A. Annual interest = $6,000; monthly = $6,000 ÷ 12 = $500.
Question 5 of 5
A seller must pay off a $150,000 loan and a 6% commission, and wants to net $50,000 at closing. Ignoring other costs, what is the minimum sale price?
Answer: C. The seller needs $150,000 + $50,000 = $200,000 after commission, which is 94% of price; $200,000 / 0.94 = $212,766.
Keep the streak going with more questions like these, each with a full rationale.
Must-know rules
- Monthly interest = balance × annual rate ÷ 12
- LTV = loan ÷ value; down % = 100% − LTV%
- Points cost = loan × points%; 2 pts on $200k = $4,000
- Debt-to-income = monthly debts ÷ gross monthly income
- PITI = principal + interest + taxes + insurance (the full payment)
Loan Math Rapid-Fire: FAQs
Is Loan Math Rapid-Fire on the real estate exam?
Yes. Real Estate Math is a scored domain on the real estate licensing exam, and this topic appears in the national portion.
Is this cheat sheet free?
Yes — every page on Cinna RE's resource library is free to read, print and share. The app adds practice questions, mock exams and a readiness score.
