Real Estate Finance

The , section contains the seller's existing mortgage loan payofff amount that must be paid to complete the transaction

"Due from seller at Closing"

In calculating PITI for a mortgage payment the annual taxes and insurance are divided by

12

The minimum down payment on a FHA loan is

3.5%

In the residential mortgage market, charging borrowers more than ,over market rate for interest is considered a predatory lending practice

5%

Which of the following is Fannie Mae most likely to purchase

A conventional fixed rate mortgage issued by a commercial lender

Equal Credit Opportunity Act

A law that protects consumers from discrimination in the granting or denying of credit

Reverse annuity mortgage

A loan that is offered based on a homeowner's equity in which funds are drawn over time and the bank gains corresponding property ownership is called a ?

In a deed of trust, who is the trustee

A neutral third party

A foreclosure occurs January 1st. Of the following which lien take priority.

A property tax lien filed January 1st

What is a reverse exchange

An investor finds and closes on an investment property and then decide to immediately sell another investment property.

FHA may adjust loan limits for each county

Annually

Which of the following sources can provide real estate professionals with important market data?

Banking, Bond , and investment analysis

What information does Schedule A of a title Commitment provide?

Basic facts related to the transaction and property, including a legal description

What is one way that the FHA has helped to stabilize and improve the mortgage market

By requiring appraisers to be state licensed or certified to evaluate property for FHA insured loans

Which document is used to establish the path and proof of ownership

Chain of Title

Cheyenne is selling the family farm an an installment contract. What is one advantage of selling the farm this way?

Cheyenne will pay less in capital gains taxes by recieving the proceeds from the sale over time, rather than in a lump sum

Synergy national bank issued a conventional loan that is eligible for purchase by Fannie Mae. When Fannie Mae purchcase's the loan, what will Synergy national bank receive in return.

Collect the fee's

Fannie Mae purchases Conventional loans from

Commercial Banks

In a loan to purchase which of the following property types is not eligible for purchase by Fannie Mae?

Commercial Space

Farmer Mac is a program that for agricultural property loans, rural utility loans and certain loans guaranteed by the U.S Department of Agricultural.

Creates a secondary market

As interest rates rise, the number of buyers in the market is likely to

Decrease

Which of the following is a true statement about Tranches?

Each tranche has specific rules for distributing income received from the collateral and has differing balances maturities and risk

The , was enacted in 1974 as a response to disciminatory practices by lenders

Equal Credit Opportunity Act

Your clients, the Nguyens, have signed a contract for deed to purchase a property, What right do they recieve?

Equitable Title and possession of the property

In which phase of the real estate market would you expect to see an increase in hiring and employment, increased public confidence, and an increase in buyers in the market

Expansion

Which government entitiy oversees open market operations?

Federal Open Market Committeee

Fannie Mae

Focuses generally on loans used to purchase or refinance a residential property.

Which of these transactions must comply with Appraiser independence requirements?

Four-unit residence being purchased with a convientional loan

Cindy is buying an older home. It is in reasonably good shape, but she figures she can reduce her energy bill by replacing some of the windows. If she applies for the FHA energy efficient Mortgage, what step must she take to receive approval

Give her lender a report of the cost estimate and energy saving from an energy consultant.

How and when does a contractor performing work associated with a 203KK loan receive funds from the lender

Half is received up front and the other half is is given after the work is completed and approved

When real estate transaction is financed using a contract for deed what advice should real estate agents give to their clients?

Have an attorney review the contract

What makes the HECM program safer for borrowers than a traditional reverse mortgage

If more equity is paid out than remains, the homeowner does not have to make up the difference

Historically, what do property values tend to do over short periods of time?

Increase and Decrease

A lender benefits from selling loans to Fannie Mae by

Increasing capital to offer loans with larger sales price

The federal housing administration's loan program

Insures lenders against loss form borrower default

Which of the following may cause the Loan Estimate to be revised

Interest rate change, switch to fixed rate loan, down payment amount change, and property appraisaal reveal increase in value.

Market Value

Is the price at which a willing buyer and a willing seller would a deal , given normal market conditions.

Which of the following clauses is inducted in Fannie Mae's multi-state note?

Late charge

Tonia is buying a new home. She has a down payment of $300,000 and will obtain a 250,00 mortgage from a local bank to make up the remainder of the purchase price. What is this a example of

Leveraging

What does the concept "First in time" refer to when discussing lien priority?

Liens are paid based on date of filing

Participation

Life insurance companies sometimes like to insure their investment in commercial projects by insisting on an equity position. This is know as what type of financing?

Freddie Macs mission is to provide , Stability, and affrodibility in the U.S. housing market

Liquidity

The ease with which an asset is converted to cash is called

Liquiidity

The Morris family home went into foreclosure December 15, and sold January. Their contractor had begun work on May 15 and was not paid and finally filed a mechanics lien on October 1st. What date will be used for lien priority for the mechanic's lien?

May 15

How can liens, such as those created by non-payment of federal income tax, result in motrgage default?

New liens can threaten the lender's position as primary lien holder. Default can occur for this reason.

Which is one of the benefits of the USDA loan program

No down payment is required

Chanel is buying a brand new home with a VA loan. She obtained a certificate of reasonable value. For how long is the CRV valid?

One Year

Which of the following statements is true about conventional loans?

Originators usually package and sell the loans on the secondary market

In which type of participation agreement would a financier lower the interest on the mortgage in exchange for partial ownership of the project?

Partnership between Mortgagees and Mortgagors

Which of the following is a piece of general data an appraise may gather?

Population size

What factors affect an adjustable rate mortgage?

Rate, index, and margin

Which of the following lending regulations apply to mortgage loans and settlement services?

Real Estate Settlement Procedures Act

A mortgage that allows the lender to sue the borrower for damages if foreclosure occurs is called a , Mortgage?

Recourse

What step of the real estate cycle generally follows recession

Recovery

What kind of communities does Farmer Mac Serve

Rural Communities

When the treasury collects fewer funds than what is needed to pay the government's bills, what action might it take?

Sell Securities

Which of these items did the FHA implement to stabilize and improve the mortgage market?

Set construction standards for homes purchased with FHA loans

Jermiah is preparing to begin the home buying process which of these is a action he should take?

Take a homeownership education course

Which act exempted homeowners from paying taxes on capital gains up to a specified index

Taxpayer Act Relief 1997

Which agency sets the guidelines for qualified mortgages?

The Consumer Financial Protection Bureau

If a cloud on a title is discovered, which party is generally responsible for clearing the cloud on the title?

The Seller

Which of the following features is shared by the mortgage and the deed of trust?

The borrower is required to maintain the property and pay property taxes and insurance

Who must provide the buyers and sellers with a cop of the closing disclosure?

The buyers lender

Open Market Options

The buying and selling of government securities as a way to influence the money supply and balance economic growth describes

in a residential real estate sale involving a federally related loan, what enititiy is required to provide real estate settlement procedures act disclosures tot he consumer

The consumers lender

The FHA has helped to significantly improve the mortgage market through

The introduction of thee long-=term amortized loan

Mortgage Note

The is where the borrower finds details about how, when and by how much the interest rate will change in the adjustable rate mortgage.

When a borrower has paid off the loan, how is the release handled if the security instrument is a mortgage?

The lender executes and records a satisfaction of mortgage and returns the note to the borrower

Mechanic's liens are based on the date

The work began

Who should sellers consult before agreeing to carry part of a loan for a buyer?

Their financial advisor

One difference between a judicial forclosure and a non judicial forclosure is that twith a not judicial forclosure

There is no statutory right of redemption

Which of the following is a likely result if FHLBanks did not exist

There would be fewer funds available for lending the community

How is title usually conveyed to the buyer during foreclosure process

Through a referee's deed

FHA offers a program for loan insurance on adjustable rate mortgages under , of the National Housing Act.

Title II

Donna and Phil have evaluated their situation, and have decided to purchase a unit in a cooperative housing project. Which FHA loan program might work for them?

Title II section 203

Which of the following will be issued only if the title is acceptable and an attorney provides a certificate of title and opiniion

Title insurance policy

U.S Department of Agriculture loan through Farm Service Agency

To be eligible for a , an applicant must have participated in farm and ranch management for at least three years.

Which Veteran loan program offers qualified veterans help with the purchase of land in Texas

Veterans Land Program

Mortgage forgiveness Debt Relief Act of 2007

Which act temp. removed the requirement that taxpayers whose home were sold as a result of a foreclosure had to include the loan write-off amount as taxable income?

Institutional money market funds

Which of the following is classified as the least liquid on the scale?

Consumers are withdrawing more money from banks than they are depositing?

Which of the following statements best describes disintermediation?

A Veteran who has received a certificate of eligibility will qualify for a VA loan

With proof of suffficient credit and income

Subprime lenders

make home ownership available for many who otherwise could not qualify for a mortgage loan

Loans that are outside the Fannie Mae and Freddie Mac guidelines such as jumbo loans are

non-conforming loans

A bank that addresses a community development need in its assessment area and donates to recovery efforts of a flooded lower income area might be an example of the bank supporting what act

Community Reinvisment Act

Which of the following entities has the authority to place an equitable lien on a property?

Court ordered by a judge

Kevin is having an appraisal performed on a piece of property he is interested in buying. He is espically interested in hearing about the estimate rate of return the property could pull.

Investment Value

Which of the following best describes the function of a deficiency judgment in the case of a foreclosure?

It allows the lender to recover losses incurred in foreclosure process.

What are the effects on a property if it includes an encumbrance?

It restricts the owner's use or decreases the value.

Brian is completing a residential loan application,. On the application, he lists his assets. What are assets?

Items of value the borrower owns

Unit of account, medium of exchange and what other factor define money?

Store of Value

What do property taxes in a mortgage payment pay for

The cost of public services as a percentage of the property value

Real estate professionals handle many documents related to real estate transactions. Which one of the items listed below is one of the most important in detecting mortgage fraud?

The original sales agreement and any addenda