Valuation and Financing Practice Question

Question

A first-time buyer asks for exam-focused clarification involving conventional loans. The parties need a practical answer before moving forward. Which answer best applies the rule? (Item 134)

Answer choices

1. A. It is valid only when the buyer pays cash and no lender is involved.
2. B. Distinguish non-government-insured mortgage loans.
3. C. It prevents any later disclosure, even when new facts become known.
4. D. It applies only to commercial property and never to residential transactions.

Correct Answer

B. Distinguish non-government-insured mortgage loans.

Explanation

The correct answer is B because conventional loans requires candidates to distinguish non-government-insured mortgage loans. The other options overstate the effect of custom, oral agreement, escrow, or independent salesperson action and do not reflect safe California exam practice.

Question details

• Difficulty: medium
• Domain: Valuation and Financing
• Objective: conventional loans

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