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Knowledge test

30 questions across the subject. Answer every question, then check your score and read the explanations at the end.

Check your understanding

1. What does the loan-to-value ratio compare?
2. Which value does a lender normally rely on when calculating LVR?
3. A second mortgagee is repaid…
4. What does capitalised interest do to the loan balance?
5. Why can comparing offers on interest rate alone be misleading?
6. What is an exit strategy?
7. What usually happens if a short-term loan is not repaid by its expiry date?
8. Interest cover ratio is calculated as…
9. How is debt service cover ratio different from interest cover ratio?
10. Gross realisation value (GRV) is…
11. What does a quantity surveyor do for a construction lender?
12. What is peak debt in a bridging loan?
13. What is a caveat?
14. A deed of priority is an agreement between…
15. What does a cross-default clause do?
16. Who usually pays transfer (stamp) duty on a property purchase?
17. Which government sets transfer duty rates?
18. Under the GST margin scheme, GST is calculated on…
19. How can a self-managed super fund borrow to buy property?
20. A regulated loan is one provided mainly for…
21. What does signing a business purpose declaration do?
22. Where can you check whether a lender holds an Australian Credit Licence?
23. What is AFCA?
24. If you receive a default notice, what is the most useful first step?
25. What does the RBA cash rate represent?
26. What is a red flag when dealing with a lender or broker?
27. What is a personal guarantee?
28. What does practical completion mean in construction?
29. Why do lenders ask where your contribution or deposit comes from?
30. What does Privet do with an enquiry you send?

Unsure of a term? See the glossary.