California Real Estate Practice Exam 2026 – 400 Free Practice Questions to Pass the Exam

Question: 1 / 740

What is the loan to value ratio above which a borrower will typically have to purchase private mortgage insurance?

70%

80%

The correct answer is B because 80% is considered the threshold for most lenders to require private mortgage insurance (PMI). PMI is typically required when the loan to value ratio exceeds 80%, meaning the borrower is borrowing more than 80% of the value of the property. This requirement is in place to protect the lender in case the borrower defaults on the loan. Options A, C, and D are incorrect because they either fall below or exceed the 80% threshold, making them less likely to trigger the requirement for PMI.

Get further explanation with Examzify DeepDiveBeta

90%

100%

Next Question

Report this question

Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy