California Real Estate Practice Exam

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Study for the California Real Estate Exam. Engage with multiple choice questions and detailed explanations to sharpen your knowledge. Get ready to ace your real estate career!

Practice this question and more.

After the first month's payment on a fully amortized mortgage loan of $165,000 at an interest rate of 6.5% for 30 years, what is the balance of the principal?

$164,955.55
$163,955.55
$164,500.00
$165,000.00

The correct answer is: $163,955.55

After the first month's payment, the balance of the principal would be slightly lower than the original loan amount of $165,000. This is because the payment goes towards both the principal and interest, but more towards the interest in the beginning of the loan. Option A is incorrect because it does not take into account the interest that accrued during the first month. Option C is incorrect because it assumes the entire payment went towards the principal, which is not the case in a fully amortized loan. Option D is incorrect because it is the original loan amount and does not reflect any payments made.