financing

Question 1

Privately insured loans

Answer 1

conventional loans

Question 2

depending on the buyers credit score, the buyer may obtain a conventional loan for up to ___ % of the property’s appraised value.

Answer 2

97

Question 3

The borrower’s mortgage insurance protects the lender agianst loss on the upper _ to _ % portion of the loan.

Answer 3

20 to 25

Question 4

PMI Insurance premiums are made a part of the

Answer 4

borrower’s payments

Question 5

as property values rise and the LTV ratio becomes 80% or less,

Answer 5

the PMI insurance may be dropped.

Question 6

allows for payments of interest only with a lump sum balloon payment of principal at a stop date

Answer 6

term or straight

Question 7

payment of some principal and interest with a larger than normal final payment

Answer 7

partially amortized

Question 8

Regulates the flow of money through member banks by controlling reserve requirements and discount rates.

Answer 8

Federal Reserve System

Question 9

Deposits are insured by the FDIC for up to ____ per depositor.

Answer 9

250,000

Question 10

Prefer short term loans but have been significant participants in residential mortgage lending.

Answer 10

commercial banks

Question 11

prefer long term commercial, industrial loans, seek equity position in projects financed and are regulated by state law.

Answer 11

life insurance companies

Question 12

originate loans for other lenders but do not service loans.

Answer 12

mortgage brokers

Question 13

may lend its own money and or serve as a broker.

Answer 13

mortgage banker.

Question 14

Contains internet provision related to a selected index.

Answer 14

Adjustable rate mortgage loans

Question 15

Loan on a home using the equity in the home as collateral for the loan, which is generally a line of credit.

Answer 15

Equity loan

Question 16

Loans to borrowers with a weakened credit history who have a greater likelihood of default. The lender compensated for greater risk by charging higher fees and interest rates than those on traditional loans.

Answer 16

Subprime loans

Question 17

A loan that exceeds the maximum loan limits is _____ and is known as a ___ loan

Answer 17

Nonconforming; jumbo

Question 18

A loan that does not conform to the standards established by Fannie Mae or Freddie Mac.

Answer 18

Nonconforming loans

Question 19

The seller of the real estate provides financing for the sale by taking back a secured note in the form of a purchase money mortgage, contract for deed, or land contract.

Answer 19

Seller/owner financing

Question 20

Primary market and sources of financing.

Answer 20

The money market.

Question 21

Money may be viewed as a means of payment, storehouse of purchasing power, standard of value. Money market is regulated by the FED, who regulates the flow of money through member banks by controlling reserve requirements and discount rates.

Answer 21

Primary money market; federal reserve system.

Question 22

Our nations fiscal manager.

Answer 22

US treasury

Question 23

Principal function a to promote thrift and home ownership.

Answer 23

Savings and loan associations

Question 24

Interest rates float with the open market; the borrower finances up front premium of 1.75% based on 1.35% of the mortgage for the life of the loan.

Answer 24

FHA insured loans

Question 25

Does not allow a prepayment penalty, mortgages are assumable

Answer 25

FHA

Question 26

VA loans can be made to

Answer 26

A veteran, a qualified non veteran or a qualified un-remarried surviving spouse.

Question 27

The HUD and department of treasury provide programs to struggling homeowners with a variety of programs such as

Answer 27

Rural Americans housing assistance.

Question 28

Trustee holds the title on behalf of the lender known as the _____

Answer 28

Beneficiary

Question 29

The ____ is the legal owner, and the _____ is the bolder of the note.

Answer 29

Trustee; beneficiary

Question 30

The trustee may commence a foreclosure action if the borrower or _____ defaults.

Answer 30

Trustor

Question 31

Promise to repay debt; a negotiable instrument.

Answer 31

Promissory note.

Question 32

If the property is sold _____ the mortgage, the buyer is not personally liable to pay the entire debt (the seller remains liable)

Answer 32

Subject to

Question 33

If the buyer _____ the mortgage, he or she becomes personally liable for payment of the entire debt. The seller is secondarily liable.

Answer 33

Assumes

Question 34

If the borrower sells the property, the lender has the choice of either declaring the entire debt due and payable or allowing the buyer to assume the loan.

Answer 34

Due on sale clause

Question 35

The act of transferring property to another; can be voluntary or involuntary

Answer 35

Alienation

Question 36

Provision in a written contract which states in the event of default, all of the principal and interest may be immediately declared due and payable

Answer 36

Acceleration clause

Question 37

Clause in a mortgage that states the terms on which the mortgagor or the ____ May prepay the entire balance of the mortgage principal prior to the due date.

Answer 37

Prepayment clause

Question 38

To relinquish an interest on, or a claim to, a parcel of property.

Answer 38

Release

Question 39

The mortgage is viewed as a lien on a real property in many states.

Answer 39

Lien theory

Question 40

Lender is viewed as the conditional owner of mortgaged land in some states.

Answer 40

Title theory

Question 41

Number of states allow the lender to take possession of the mortgages real estate on default.

Answer 41

Intermediate theory

Question 42

Trigger terms may not be advertised unless the ad includes full disclosure of these terms:

Answer 42

Amount of down payment, amount of loan or cash price, finance charges as APR, number amount and due date on payments, total of all payments except where advertisement relates to first mortgage.

Question 43

Requirements of RESPA include: giving a copy of settlement costs and you to each loan applicant, must be provided with a ____ estimate by lenders no later than ____ business days, loan closing expenses must be prepared on ____.

Answer 43

Good faith, 3, HUD form 1

Question 44

RESPA explicitly prohibits the payment of ____ and prohibits referral fees when no services are actually rendered.

Answer 44

Kickbacks

Question 45

ECOA prohibits discrimination the same as the federal fair housing laws except with the exception of

Answer 45

Age and applicants that get public assistance.

Question 46

Mortgage fraud is punishable up to ___ years in prison, a ___ fine or both.

Answer 46

30, 1

Question 47

Any practice in which lenders try to coerce consumers into agreeing to loans that are unaffordable and violate industry standards.

Answer 47

Predatory lending.

Question 48

Requires disclosure of loan terms as well as APR.

Answer 48

Truth in lending act

Question 49

Covers more than one property or lot; generally includes a partial release clause.

Answer 49

Blanket mortgage.

Question 50

Includes real estate and al fixtures and appliance located on the property.

Answer 50

Package loan.