Loan Programs,Fees,Qualifying & Markets

Question 1

FHA operates under the:
a. Dept of Housing & Urban Development (HUD)
b. Consumer Financial Protection Bureau (CFPB)
c. Federal National Mortgage Association (Fannie Mae)
d. Government National Mortgage Assoc (Ginnie Mae)

Answer 1

A.

Question 2

A property is sold for $50,000 with a $10,000 down payment and a $40,000 loan. If the lender charges 4 points, the discount paid will be:
a. $400
b. $1600
c. $2000
d. $2400

Answer 2

B. 1600

Question 3

Which of the following conventional loan percentages requires private loan insurance?
a. 70%
b. 75%
c. 80%
d. 90%

Answer 3

C. 80%

Question 4

Which mortgage requires no down payment from a qualified buyer?
a. conventional
b. conventional with PMI
c. FHA-insured
d. VA-guaranteed

Answer 4

D. VA

Question 5

A veteran qualifies for a VA loan. .The Dept. of Veteran Affairs will issue a certificate of:
a. eligibility
b. entitlement
c. conditional commitment
d. estoppel

Answer 5

A.

Question 6

Insured conventional loan permits:
a. lenders to make loans with higher loan-to-value ratios
b. borrowers to waive principal payments
c. lenders to insure the entire loan amount
d. lower interest rate for borrowers

Answer 6

C.

Question 7

Funds for conventional loans are secured from:
a. FHA
b. Fannie Mae
c. Freddie Mac
d. private sources

Answer 7

D.

Question 8

Which of the following best describes the escape clause in an FHA purchase contract? The buyer must:
a. be presented w/ all closing expenses before close of escrow (COE)
b. see the appraisal
c. receive a statement of all financing charges expressed as an APR
d. be given a three day right to rescind

Answer 8

B. see the appraisal

Question 9

The penalty for prepayment of an FHA loan during the first 10 years is:
a. 2% of the remaining balance
b. 90 days of interest on the remaining balance
c. 1% of the original loan amount
d. nothing

Answer 9

D. nothing

Question 10

The payment of $750 on a fixed rate FHA mortgage increases to $755. This increase is probably caused by an increase in:
a. real property taxes
b. the interest rate
c. inflation
d. the mortgage insurance premium

Answer 10

D. the MIP

Question 11

Funds for FHA loans are secured from:
a. Fannie Mae
b. approved local lenders
c. FDIC
d. FHA

Answer 11

B.

Question 12

The FHA insurance premium protects the:
a. mortgage
b. borrower
c. US government
d. seller

Answer 12

A.

Question 13

Which of the following loans would have the highest loan-to-value ratio?
a. conventional
b. conventional with PMI
c. FHA
d. VA

Answer 13

B.

Question 14

To qualify for a VA-guaranteed loan, the veteran must:
a. pay a 5% down pmt
b. occupy the house
c. pay the mortgage insurance premium
d. pay discount points

Answer 14

B.

Question 15

Under a VA loan, the appraisal is known as the:
a. certificate of reasonable value
b. reduction certificate
c. estoppel certificate
d. certificate of no defense

Answer 15

A.

Question 16

a loan that meets all of the Fannie Mae or Freddie Mac guidelines is a:
a. conforming loan
b. nonconforming loan
c. jumbo loan
d. hard money loan

Answer 16

A.

Question 17

A couple who are winning tennis pros but have no regular/verifiable income want to buy a home. They have a significant amount of money for a down payment and want to pay off the loan in 5 years. What type of loan are they most likely going to be able to obtain?
a. FHA loan
b. VA loan
c. Small Business Admin loan
d. Personal bank loan

Answer 17

D.

Question 18

Which of the following conventional loan-to-value ratios would not need private mortgage insurance:
a. 80% ltv
b. 85% ltv
c. 90% ltv
d. 95% ltv

Answer 18

A. 80

Question 19

What is the maximum VA loan limit with no down payment?
a. as set by the VA
b. there is no limit
c. whatever is determined by the lender
d. 60% of eligibility

Answer 19

C.

Question 20

Which of the following applies to a VA loan?
a. Funding fee
b. MIP
c. PMI
d. Font- and Back-end ratios

Answer 20

A.

Question 21

Which statement about VA loans is false:
a. a 3.5% min down payment is required
b. the property must be owner-occupied
c. there is no max loan amount
d. there is no private mortgage insurance required

Answer 21

A.

Question 22

When a listing agent is selling a property using a seller carryback, the agent should be most concerned with:
a. clear title
b. the buyer’s income
c. the seller’s financial status
d. listing price

Answer 22

A.

Question 23

A buyer assumes an FHA mortgage. The seller does not want to remain liable. What action can the seller take?
a. get a written agreement from the buyer
b. get a written release from the lender
c. novate the mortgage
d. assign the mortgage

Answer 23

B.

Question 24

Fannie Mae and Freddie Mac do not:
a. sell loans
b. sell bonds secured by mortgages
c. buy conventional loans
d. originate FHA and VA loans

Answer 24

D.

Question 25

The primary mortgage market is best defined as where:
a. first and second mortgages are originated
b. first mortgages are sold
c. mortgages are bought and sold
d. federally subsidized mortgages are sold

Answer 25

A.

Question 26

Mortgage bankers typically make loans in the:
a. money market
b. primary market
c. secondary market
d. stock market

Answer 26

B.

Question 27

Which of the following is not part of the secondary market?
a. Fannie Mae
b. Federal Housing Admin.
c. Ginnie Mae
d. Freddie Mac

Answer 27

B. FHA

Question 28

If a veteran pays off an existing VA loan their eligibility for another VA loan is:
a. restored
b. terminated
c. reduced
d. increased

Answer 28

A.