A-7 Residential Financing Flashcards

1
Q

Which FHA title loan program features for construction, buying a home or refinancing existing mortgages.

A

Title II

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2
Q

Which FHA title program was created for the Federal National Mortgage Association “Fannie Mae” to purchase title II loans from primary lenders.

A

Title III

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3
Q

In an FHA loan what percent must the buyer put down?

A

3.5%

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4
Q

Who sets the maximum FHA loan amount?

A

Congress

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5
Q

What loan program requires an escape clause that permits the buyer to void the contract if the property does not appraise for the sale price?

A

FHA

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6
Q

An FHA appraisal is valid for how many days?

A

120 days

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7
Q

What are the four C’s in acquiring an FHA loan

A

Cash, credit, collateral, and capacity

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8
Q

At what credit score is a buyer approved for maximum financing in an FHA loan?

A

580

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9
Q

In an FHA loan, borrowers with decision credit score between what two values are limited to 90% of LTV?

A

500–579

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10
Q

What are the qualifying ratios for an FHA loan?

A

31% for the front ratio (house payments PITT, divided by gross monthly income)and 43% for the back ratio (long-term debt such as payments on cars, credit cards and furniture)

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11
Q

In an FHA loan what percent is the seller allowed to contribute?

A

6% of the sales price, this includes not only discount points, but any closing costs, prepaid expenses and temporary buydown cost that the seller pays for the fire one point equals 1% of the loan amount

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12
Q

What are be a qualifying ratios?

A

Can be as much as 41% of the buyers gross monthly income

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13
Q

What is the VA guaranteed to the lender?

A

Typically lenders do not loan more than four times the VA eligibility, the VA will guarantee the Wender up to 104,250 on purchases of $417,000 or less.

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14
Q

Are conventional fixed rate loans and variable rate mortgage is assumable?

A

Only variable rate mortgages are simple, all fixed conventional bones have a due on sale clause

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15
Q

Variable rate mortgages, or adjustable rate mortgages have a – CAP?

A

2–6, which means the interest rate cannot be adjusted upward more than 2% a year or more than 6% over the life of the loan from the initial floor rate

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16
Q

What is a home equity conversion loan?

A

A reverse mortgage in which homeowners can borrow money against the value of their home

17
Q

How old do you have to be to qualify for a reverse mortgage?

A

62

18
Q

Which FHA title program features relatively modest loans for home repairs and improvements

A

Title I