Real Estate Basics · Level 3 of 5 · Intermediate

Buying a home

Pre-approval, offers, inspections, and the closing timeline.

Study notes

A mortgage pre-approval means a lender reviewed your credit, income, and assets and conditionally agreed to lend up to an amount. It makes offers stronger.
An offer names price, earnest money, financing terms, contingencies, and a closing date.
Contingencies let a buyer cancel under stated conditions, such as an unsatisfactory inspection, an appraisal below price, or financing falling through.
Earnest money is a good-faith deposit held in escrow and usually credited to the buyer at closing. It can be at risk if the buyer backs out without a valid contingency.
Closing costs commonly include lender fees, title insurance, recording fees, prepaid taxes and insurance. The Closing Disclosure must be provided at least three business days before closing on most mortgages.

Quiz: 6 questions

Choose one answer for each question, then check your answers. Score 5 of 6 to pass. Then enter your name and email to download a PDF certificate and have a copy emailed to you. Answers are graded in your browser.

1. A pre-approval shows sellers that:

A lender has reviewed your finances and conditionally agreed to lend You have already closed The home passed inspection You own another home

2. An inspection contingency lets the buyer:

Cancel or renegotiate if the inspection reveals problems, under the contract terms Skip paying closing costs Move in before closing Lower property taxes

3. Earnest money is:

A good-faith deposit usually credited at closing The real estate agent's fee A property tax A loan from the seller

4. The appraisal comes in below the price. Which contingency helps the buyer?

Appraisal contingency Pet contingency Paint contingency Furniture contingency

5. For most mortgages, the Closing Disclosure must arrive how far before closing?

At least three business days One hour Thirty days It is optional

6. Which is a typical closing cost?

Title insurance Groceries Moving boxes Furniture

About this certificate: Certificates are issued by Get Certified for Free for passing a free online knowledge quiz. They are not accredited, licensed, government, academic, or professional credentials and do not confer a license. Read the full terms.