Texas Real Estate Finance - Chp 9 - Lender Loan Processes
What is the most commonly used term on residential mortgages...? 7 years 10 years 20 years 30 years
30 years
What is the maximum front-end debt-to-income ratio on an FHA loan...? A31 percent (%) B23 percent (%) C52 percent (%) D16 percent (%)
31 percent (%)
Survey -
A document which precisely shows the property lines and size and location of improvements on a particular property.
Constructive Notice -
A fact, imputed to a person by law, which should have been discovered because of the person's actual notice of circumstances and the inquiry that a prudent person would have been expected to make.
Chain of Title -
A history of conveyances and encumbrances affecting the title from the time the original patent was granted, or as far back as records are available, used to determine how title came to be vested in current owner.
Gross Rent Multiplier -
A number which, times the gross income of a property, produces an estimate of value of the property.
Abstract of Title -
A summary or digest of all transfers, conveyances, legal proceedings, and any other facts relied on as evidence of title, showing continuity of ownership, together with any other elements of record which may impair title.
Appraisal -
A written statement, independently and impartially prepared by a qualified appraiser setting forth an opinion in a federally related transaction as to the market value of an adequately described property as of a specific date. It is supported by the presentation and analysis of relevant market information. An opinion of value.
A summary or digest of all transfers, conveyances, legal proceedings, and any other facts relied on as evidence of title, showing continuity of ownership, together with any other elements of record which may impair title, is known as...? Abstract of title Chain of title Title history Clouded title
Abstract of title
This is a written statement, independently and impartially prepared by a qualified appraiser setting forth an opinion in a transaction, as to the market value of an adequately described property, as of a specific date...? Appraisal Comparative Market Analysis Pro-forma Statement of value
Appraisal
Which of the following are included as the buyer's charge on a closing settlement statement...? Broker commissions Appraisal fees Recording fees All of the above
Appraisal fees
Which of the following are included as the buyer's charge on a closing settlement statement...? Appraisal fees Credit reports Title insurance All of the above
Appraisal fees Credit reports Title insurance All of the above
Something that has value is known as a/an...? Asset Liability Debit Tax
Asset
Which of the following are included as the seller's charge on a closing settlement statement...? Broker commissions Transfer taxes Recording fees All of the above
Broker commissions Transfer taxes Recording fees All of the above
This is the rate of interest which is considered a reasonable return on the investment, and used in the process of determining value based upon net income...? Capitalization rate Gross rent multiplier Yield IRR
Capitalization rate
Under the Uniform Residential Loan Application, which of the following is considered an asset for the borrower...? Cash deposits Homeowners insurance Credit cards All of the above
Cash deposits
A history of conveyances and encumbrances affecting the title of a property, which is used to determine how title came to be vested in current owner, is known as...? Chain of title Abstract of title Title history Clouded title
Chain of title
Title that is encumbered or burdened with defects is known as...? Partial title Inferior title Clouded title Marketable title
Clouded title
This is an analysis in which a value estimate of a property is derived by estimating the replacement cost of the improvements, deducting therefrom the estimated accrued depreciation, then adding the market value of the land...? Sales comparison approach Income capitalization approach Cost approach CMA
Cost approach
Unique properties are typically valued using which appraisal method...? ACost approach BSales comparison approach CIncome capitalization approach DCMA
Cost approach
The ability to deduct expenses on improvements made to income producing property is known as...? Appreciation Depreciation Buydown Write-off
Depreciation
When qualifying a borrower, the lender will do which of the following...? Determine the ability of the borrower to repay Estimate the value of the property being used as collateral Research and analyze the marketability of title All of the above
Determine the ability of the borrower to repay Estimate the value of the property being used as collateral Research and analyze the marketability of title All of the above
The 'Site' section of the Uniform Residential Appraisal Report includes which of the following information...? Dimensions of the subject property Age of subject property Neighborhood boundaries Improvements on the property
Dimensions of the subject property
Which of the following is an example of a credit bureau...? Equifax Experian TransUnion All of the above
Equifax Experian TransUnion All of the above
Actual Notice -
Express or implied knowledge of a fact.
An appraisal determines an estimate of...? AFair market value BValue-in-use CAssessed value DTax value
Fair market value
An exterior description of the subject property is listed under what section of the Uniform Residential Appraisal Report...? Subject Neighborhood Improvements Site
Improvements
One of the three major valuation methods, which determines the value of a property by applying a capitalization rate to a property's net operating income is known as the...? Sales comparison approach Income capitalization approach Cost approach CMA
Income capitalization approach
Title Insurance -
Insurance to protect a real property owner or lender up to a specified amount against certain types of loss (ex: defective or unmarketable title).
The 'Subject' section of the Uniform Residential Appraisal Report includes which of the following information...? Improvements on the property Legal description of the property Neighborhood characteristics Zoning lot size
Legal description of the property
The Uniform Residential Loan Application includes which of the following information...? Legal description of the property Names of the borrower and co-borrower The requested loan amount All of the above
Legal description of the property Names of the borrower and co-borrower The requested loan amount All of the above
Monies that are owed are considered...? Assets Taxes Liabilities Credits
Liabilities
Which of the following is an example of a long-term liability...? Liens Child support Taxes All of the above
Liens Child support Taxes All of the above
What information about the borrower must be included on the Uniform Residential Loan Application...? National origin Religion Marital status Race
Marital status
A buyer should receive a/an .............prior to closing on a property? AMarketable title BUnmarketable title CClouded title DRecorded title
Marketable title
Title which a reasonable purchaser, informed as to the facts and their legal importance and acting with reasonable care, would be willing and ought to accept is known as...? Recorded title Clouded title Marketable title Unmarketable title
Marketable title
According to the sales comparison approach, if the comparable sale #1 includes a garage, and the subject property does not, what type of adjustment needs to be made...? Even adjustment Negative adjustment Positive adjustment Minute adjustment
Negative adjustment
Assets minus liabilities equals an individual's...? Income Net worth Gross worth Balance
Net worth
Sales Comparison Approach -
One of the three major valuation methods, which compares a subject property's characteristics with those of comparable properties which have recently sold in similar transactions.
Income Capitalization Approach -
One of the three methods of the appraisal process generally applied to income producing property, and involves a three-step process - (1) find net annual income, (2) set an appropriate capitalization rate or "present worth" factor, and (3) capitalize the income dividing the net income by the capitalization rate.
Cost Approach - .
One of three methods in the appraisal process. An analysis in which a value estimate of a property is derived by estimating the replacement cost of the improvements, deducting therefrom the estimated accrued depreciation, then adding the market value of the land
Appraiser -
One qualified by education, training and experience who is hired to estimate the value of real and personal property based on experience, judgment, facts, and use of formal appraisal processes.
An attorney may issue which of the following...? AOpinion of title BChain of title CSurvey DAll of the above
Opinion of title
Which of the following is an example of a liability...? Stocks Real estate Bonds Outstanding loan balance
Outstanding loan balance
If an individual's assets exceed their liabilities, they are said to have a...? Positive net worth Negative net worth Positive credit score Positive income
Positive net worth
The division of certain settlement costs between a buyer and seller is known as...? Payout Proration Buydown Settlement disclosure
Proration
A property's NOI divided by the capitalization rate, equals the...? Gross rent multiplier IRR Purchase price Yield
Purchase price
One of the three major valuation methods, which compares a subject property's characteristics with those of comparable properties which have recently sold in similar transactions is known as the...? Cost approach Sales comparison approach Income capitalization approach CMA
Sales comparison approach
A document which precisely shows the property lines, and size and location of improvements on a particular property, is known as a...? Roof plan RCP Topography plan Survey
Survey
The seller is primarily responsible for paying the broker's commission at closing...? T (True) F (False)
T (True)
Depreciation -
The ability to deduct expenses on improvements made to income producing property.
Net Operating Income -
The annual income generated by an income-producing property after taking into account all income collected from operations, and deducing all expenses incurred from operations.
When qualifying a borrower, the lender needs to verify which of the following...? The borrower's employment status The borrower's income The borrower's assets and liabilities All of the above
The borrower's employment status The borrower's income The borrower's assets and liabilities All of the above
Proration -
The division of certain settlement costs between a buyer and seller.
The objective of the Uniform Residential Loan Application is to identify which of the following...? The property The borrower The loan amount requested by the borrower All of the above
The property The borrower The loan amount requested by the borrower All of the above
Capitalization Rate -
The rate of interest which is considered a reasonable return on the investment, and used in the process of determining value based upon net income.Capitalization Rate = NOI / Purchase Price
Insurance to protect a real property owner or lender up to a specified amount against certain types of loss is known as...? Homeowners insurance HO-1 insurance policy Title insurance HO-3 insurance policy
Title insurance
Clouded Title -
Title that is encumbered or burdened with defects
Which of the following is used at the start of the loan application process...? Residential Loan Form Primary Loan Application Universal Loan Form Uniform Residential Loan Application
Uniform Residential Loan Application
The value derived from the use of something is known as...? Inherent value Utility value Value-in-exchange Value-in-use
Value-in-use
