Finance Flashcards

Real Estate Finance

all of the following clauses in a loan agreement enable the lender to demand the entire remaining dept be paid immediately EXCEPT a/na. due-on-sale clauseb. alienation clausec. defeasance claused. acceleration clause defeasance clause
A real estate loan payable in periodic installments that are sufficient to pay the principal in full during the term of the loan is called a a. straight loanb. partially amortized loanc. conventional loand. fully amortized loan fully amortized loan
the pledging of property as security for payment of a loan without surrendering possession is a. subordinationb. hypothecationc. equityd. disintermediation hypothecation
Mortgage lenders want assurance that future real estate taxes will be paid. The most common way to do this is to require the borrower to a. sign a noteb. submit paid tax receiptsc. pay into an impound accountd. obtain title insurance pay into an impound account
The typ of real estate loan that allows the lender to increase the outstanding balance of a loan up the original sum in the note while advancing additinoal funds is the a. graduated-payment mortgageb. wraparound mortgagec. open-end mortgaged. growing-equity mortgage open-end mortgage
the principal distinction between the primary mortage market and the secondary mortgage market is in the a. use of mortgages versus the use of deeds of trustb. use of discount points versus the use of origination feesc. origination versus the purchase of mortage loansd. insuring versus the guaranteeing of mortgage loans origination versus the purchase of mortgage loans
the clause in a trust deed or mortgage that permits the lender to declare the entire unpaid balance immediately due and payable upon default is teh a. acceleration clauseb. escalator clausec. judgement claused. forfeiture clause acceleration clause
the right a mortgagor has to regain the property by paying the debt after a foreclosure sale is calleda. recaptureb. reversionc. redemptiond. acceleration redemption
a borrower obtained a $7,000 second mortgage loan for 5 years at 6 percent interest per annum. Monthly payments of principle and interest were $50.00. The final payment included the remaining outstanding principal balance. What type of loan is this?a. a fully amortized loanb. a straight loanc. an accelerated loand. a partially amortized loan a partially amortized loan
Billy Bob has just purchased his first home with a fixed-rate loan. The interest he will pay on this loan will be computed as a. compound interestb. discounted interestc. simple interestd. prepaid interest simple interest
The amount of a loan expressed as a percentage of the value of the real estate offered as collateral is the a. debt-to-equity ratiob. amortization ratioc. loan-to-value ratiod. capital-use ratio loan-to-value ratio
Fannie Maea. insures FHA loansb. buys FHA loansc. makes FHA loansd. services FHA loans buys FHA loans
LaShawn has just made the final payment on her home mortgage to her lender. There will still be a lien on her property until the lender records a/na. reversion of mortgageb. reconveyance of mortgagec. satisfaction of mortgaged. alienation of mortgage satisfaction of mortgage
An eligible veteran made a purchase offer of $180,000 on a home he wants to finance with a VA guaranteed loan. Four weeks after the offer was accepted, a certificate of reasonable value (CRV) for $177,000 was issued for the property. In this situation, the veteran could do all of the following excepta. withdraw from the purchase without penaltyb. purchase the property with a $3,000 cash down paymentc. insist that the lender loan up the allowable maximum of the certificate of eligibilityd. negotiate with the seller to reduce the price to $3,000 insist that the lender loan up the allowable maximum of the certificate of eligibility
if the amount realized at a sheriff’s sale as part of a mortgage foreclosure is more than the amount of the indebtedness and expenses, then the excess belongs toa. the mortgageeb. the sheriff’s officec. the county d. the mortgagor the mortgagor
when real estate is sold under an installment land contract and the buyer takes possession of the property the legal title, a. must be transferred to a land trustb. is kept by the seller until the purchase price is paid according to the contractc. is transferred to the buyerd. is subject to a purchase money mortgage is kept by the seller until the purchase price is paid accourding to the contract
members of which of the following pairs of terms are synonymousa. construction loan and pass-through looanb. interim financing and construction loanc. takeout loan and construction loand. pass-through loan and takeout loan interim financing and construction loan
a freindly foreclosure enables a mortgagor to prevent the mortgagee from taking the property by statutory means. This can be accomplisted by use of a/n:a. assumptionb. deed in lieu of foreclosurec. escrow deedd. reconveyance deed deed in lieu of foreclosure
the purpose of a mortgage is toa. create a lien on the propertyb. restrict the borrowers use of the propertyc. provide security for the loan provide security for the loan
under an installment contract, the title to the property is held by the a. trusteeb. vendorc. trustord. vendee vendor
which of the following is true about an installment (land) contrat?a. the buyer obtains a mortgage loanb. the seller delivers legal title to the buyerc. the buyer is given posessiond. the seller delivers a deed to the buyer the seller delivers legal title to the buyer
a promissory notea. is a guarantee by a government agencyb. makes the borroower personally liable for the debtc. is an agreement to perform nor not to perform certain actsd. may not be executed in connection with a real estate loan makes the borrower personally liable for the debt
the fee charged by a mortgage broker to arrange a loan is a/na. loan origination feeb. prepayment penaltyc. prepayment of mortgage insuranced. advance interest payment loan origination fee
which of the following loans to individuals is NOT affected by the Truth in Lending Law under Regulation Z?a. household useb. business usec. swimming poolsd. room additions business use
the defeasance clause in a mortgage requires the mortgagee to execute a/na. assignment of mortgageb. satisfaction of mortgagec. subordinatio agreementd. partial release agreement satisfacation of mortgage
which of the following statements is truea. a mortgage document contains no covenants or promises on the part of the borrowerb. a buyer does not have to be a veteran to assume a VA loanc. a deed of trust is typically conveyed by the trustor to the beneficiaryd. the priority of a mortgage is determined by the date on which it was executed a buyer does not have to be a veteran to assume a VA loan.
a land contract provides for the a. immediate transfer of reversionary rightsb sale of unimproved land onlyc. sale of real property under an option agreementd. conveyance of legal title at a future date conveyance of legal title at a future date
a mortgagor is the one who gives the mortgage
the seller agrees to sell the house to the buyer for 100,000. The buyer was unable to qualify for a mortgage loan for this amount so the seller and the buyer enter into a contract for deed. the interest the buyer has in the property under a contract for deed isa. equitable titleb. joint titlec. legal titled. mortgage in possession equitable title
if a property sold at a mortgage foreclosure does not bring an amount suffficient to satisfy the outstanding mortgage debt, the mortgagor may be responsible for a. a default judgementb. liquidated damagesc. punitive damagesd. a deficiency judgement a deficiency judgement
a person who assumes an existing mortgage loan isa. personally responsible for paying the principal balance. b. not in danger of losing the property by default c. generally released from liability, but not alwaysd. not personally liable for the repayment of the debt a personally responsible for paying the principal balance.
in absence of an agreement to the contrary, the mortgage having priority will be the onea. which was signed firstb. that is a construction loanc. which was recorded firstd. for the highest amount which was recorded first
in what way does a deed of trust differ from a mortgagea. in the time period permitted to cure a defaultb. in the redemption rights allowed after foreclosurec. in the number of parties involved in the loand. in the obligation of the borrower to repay the funds in the number of parties involved in the loan
in a house sold for $80,000 and the buyer obtained a loan for $72,000, how much money would the buyer pay if the lender charged 3 points?a. $240b. $2160c. $2400d. $2328 $2160
A mortgage broker generally offers which of the following services?a. providing credit qualification and evaluation reportsb. bringing the borrower and the lender togetherc. handling the escrow proceduresd. granting real estate loan using investors funds bringing the borrower and the lender together
charging more interest than is legally allowed is knows asa. usuryb. a deficiencyc. escheatd. an estoppel usury
An extension of credit from a seller to a buyer to allow the buyer to complete the transaction is called a a. purchase money mortgageb. package mortgagec. blanket mortgaged. growing equity mortgage purchase money mortgage
the clause in a mortgage instrument that would prevent the assumption of the mortgage by a new purchaser is a a. power of sale clauseb. defeasance clausec. due-on-sale claused. certificate of sale clause due-on-sale clause
when a mortgage loan has been paid in full, it is important for the borrower to be sure thata. he or she obtains a deed of partioal reconveyanceb. the paid note is placed in a safe deposit boxc. a satisfacation of mortgage is recordedd. the paid mortgage is returned to the lender a satisfaction of mortgage is recorded
if a buyer obtains a $50,000 morgage with 4 points, how much will the lender charge at closing?a. $40,000b. $2,000c. $6,000d. $200 2,000
the purpose of the Real Estate Settlement Procedures Act (RESPA) is toa. see that buyer do not borrow more money that they can payb. help sellers know how much money is required to purchase the propertyc. help borrowers know and understand all their settlement costsd. make real estate brokers more responsive to the needs of buyers help borrowers know and understand all their settlement costs
an FHA-insured mortgage loan would be obtained from which of the following?a. the Federal Housing Administrationb. Any FHA-approved insuring institutionc. The Department of Housing and Urban Developmentd. Any FHA- approved lending institution any FHA-approved lending institution
The discount points charged on a VA guaranteed mortgage loan could NOT be paida. from the mortgage loan proceedsb. by the sellerc. by the buyerd. by the buyer and seller from the mortgage loan proceeds
When compared with a 30-year payment period, taking out a loan with a 20-year payment period would result ina. greater impound requirementsb. lower monthly paymentsc. higher monthly paymentsd. slower equity buildup higher montly payments
the mortgagee foreclosed on a property after the borrower defaulted on the loan payments. At the foreclosure sale, however, the house sold for only $129,000. The unpaid balance of the loan at the time of the sale was $140,000. What must the lender do to recover the $11,000 the borrower still owes?a. seek a deficiency judgementb. sue for damagesc. sue for special performanced. seek a judgement by default seek a deficency judgment
A building was sold for $115,000. Earnest money in the amount of $15,000 was deposited in escrow, and the buyer obtained a new loan for the balance of the purchase price. The lender charged 2 discounts points on the loan. What was the total amount of cash used by the buyer for this purchase?a. $15,000b. $2,300c. $17,000d. $17,300 17,000
Fannie Mae, Ginnie Mae, and Freddie Mac alla. insure residential mortgage loansb. originate residential mortgage loansc. purchase existing mortgage loansd. guarantee existing mortgage loans purchase existing mortgage loans
If the quarterly interest at 10 1/2 percent is $3,150, the principal amount of the loan is a. $120,000b. $90,000c. $30,000d. $60,000 120,000
An existing mortgage loan can have its lien priority lowered through the use of a a. reconveyance of mortgageb. subordination agreementc. satisfaction of mortgaged. hypothecation agreement subordination agreement

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