RE: Mortgage Lending Tax Impacts

Lower than

An ARM usually offers an initial interest rate that's ______ a fixed rate mortgage for a period of time.

95% rule

An investor can exchange multiple properties as long as the properties total at least 95% of the value of the relinquished property. The total value of the property (or properties) being exchanged is at least 95% of the value of the property being sold.

Three-property rule

An investor can identify up to three replacement properties with no fair market value restriction, provided they meet the debt load requirement.

a reverse exchange

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

boot

Cash an investor receives from sale proceeds is called "_______" and is taxable.

$750,000; 375,000

For properties purchased in years 2018-2025, married homeowners who file jointly may deduct interest on up to $_________ in debt, whereas married homeowners who file separately may deduct interest on up to $________ in debt.

Coordinates the exchange

In a 1031 tax-deferred exchange, what role does the qualified intermediary serve?

interest portion

In the early years of a mortgage loan term, what portion of the payment is likely to be the largest?

10

It's possible for the adjustment period on an adjustable rate mortgage (ARM) to have ranges, such as three or ______ years apart.

180

The _____-calendar-day deadline to close on a subsequent property in a tax-deferred exchange is absolute.

45

The _____-day deadline to identify a like-kind property in a tax-deferred exchange includes weekends.

1031 tax exchange

The ____________ is used to defer paying taxes when there is an almost immediate repurchase of what's called a "like-kind" property. Rolling over funds from one IRA into another

mortgage; property

Two primary income tax deductions for homeownership are ________interest and _________taxes.

Property taxes

What are the cost of public services divided by the value of property for the area.

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

What do property taxes in a mortgage payment pay for?

A qualified intermediary

What type of professional must an investor use to conduct a tax-deferred exchange?

To convert the interest rate from fixed to adjustable

What's the purpose of the fixed/adjustable rate note?

Margin plus index

When an adjustable rate mortgage (ARM) makes its initial adjustment, it does so to its fully indexed rate. What makes up the fully indexed rate?

200% rule

When exchanging more than one property, the combined fair market value of the properties can't be more than 200% of the value of the relinquished property.

Duplex, office building, or warehouse

Which of the following could an investor who sells an apartment house buy using a 1031 exchange?

Interest

is the "fee" paid back to the lender for the use of their money. This portion of the payment generally decreases over the life of the mortgage.

Principal

is the actual amount owed on the loan. As the interest portion of the mortgage payment decreases, more of the payment is applied to this.