Real Estate U Texas Real Estate Finance(6)
Which of the following mortgage types allows for more flexible payments from the borrower...? Conventional mortgage Open-end mortgage Fixed-rate mortgage FHA insured mortgage
Open-end mortgage
What is the minimum down payment for an FHA insured loan...? A3.5 Percent (%) B20 Percent (%) C50 Percent (%) D10 Percent (%)
3.5 Percent (%)
A long term real estate cycle is typically...? A10-15 years B3-5 years C1-2 years D5-7 years
10-15 years
The Federal Reserve System includes how many geographical districts...? 6 8 12 20
12
The Federal Reserve was established in what year...? 1913 1931 1945 2009
1913
HUD was created in what year...? 1933 1965 1988 2009
1965
The Interstate Land Sales Full Disclosure Act was enacted in what year...? 1964 1968 1974 1988
1968
The Equal Credit Opportunity Act was enacted in what year...? 1933 1964 1974 2001
1974
A completed Closing Disclosure form must be provided to the borrower at least ..............prior to closing? 3 days 7 days 10 days 14 days
3 days
The lender must provide the borrower with a Loan Estimate form within how many days of the loan application being filed..? 3 days 5 days 7 days 14 days
3 days
A short term real estate cycle is...? 1-2 years 3-5 years 5-7 years 10-12 years
3-5 years
Fair Housing Act of 1968 -
A federal Prohibition on discrimination in sale, rental, financing, or appraisal of housing on the basis of race, color, religion, gender, national origin, handicap, or familial status.
Equal Credit Opportunity Act (ECOA) -
A federal law enacted in 1974 which makes it unlawful for any creditor to discriminate against any applicant, which respect to any aspect of a credit transaction, on the basis of race, color, religion, national origin, sex, marital status, or age.
Mortgage Insurance Premium (MIP) -
A one-time premium paid at the closing pursuant to the purchase.
Sub-prime Mortgages (lending) -
A type of loan granted to individuals with poor credit histories (often below 600), who, as a result of their deficient credit ratings, would not be able to qualify for conventional mortgages.
Private Mortgage Insurance (PMI) -
A type of mortgage insurance required on conventional loans in which the homebuyer makes a down payment of less than 20% of the purchase price.
Open-end mortgages are most commonly found for which property type...? Agricultural properties Commercial properties Single family homes Industrial properties
Agricultural properties
Instruments of credit can do which of the following...? AAll of the above BBe regulated by member banks of the Federal Reserve CCollect and clear checks DAdminister credit controls
All of the above
National member banks of the Federal Reserve must do which of the following...? AAll of the above BMaintain reserves CClear checks DComply with the rules and regulations of the Federal Reserve
All of the above
Sara is working with a bank to obtain financing on her new house. According to the ECOA, the bank is prohibited from asking Sara which of the following...? If Sara is divorced If Sara receives child support If Sara intends to have a baby in the near future All of the above
All of the above
The Closing Disclosure includes which of the following information...? Summary of actual loan terms Other settlement costs Loan costs All of the above
All of the above
The Equal Credit Opportunity Act prohibits discrimination against which of the following protected classes...? Religion Marital status National origin All of the above
All of the above
The Federal Reserve is responsible for which of the following...? AAll of the above BEstablishing facilities for the sale of commercial paper CSupervise banking activities DInfluence the availability of money and credit
All of the above
The Loan Estimate provides the borrower with which of the following information...? Summary of loan terms Estimated loan costs Closing costs All of the above
All of the above
Which of the following are covered under TILA...? Real estate loans under 50,000 dollars Personal loans under 50,000 dollars Consumer loans under 50,000 dollars All of the above
All of the above
Which of the following may be a lender in a real estate transaction...? AAll of the above BFamily and friends CInsurance company DCommercial bank
All of the above
Which of the following may impact real estate cycles...? Social attitudes Taxes Property values All of the above
All of the above
Which of the following participates in the secondary mortgage market...? AAll of the above BFannie Mae CFreddie Mac DGinnie Mae
All of the above
The relative cost of credit is also known as the...? Annual Percentage Rate Relative Interest Rate Simple Interest Rate Variable Interest Rate
Annual Percentage Rate
Annual Percentage Rate (APR) -
Annual Percentage Rate (APR) - The relative cost of credit as determined in accordance with Regulation Z of the Board of Governors of the Federal Reserve System for implementing the Federal Truth in Lending Act.
When using leverage to help purchase a residential property, what is typically used to cover the remainder of the purchase price...? ACash down payment BSeller financing COptions money DCredit cards
Cash down payment
Real or personal property which a borrower pledges as security for a loan is known as...? Accessory Chattel Collateral Substantial property
Collateral
Which of the following is responsible for the enforcement of the Interstate Land Sales Disclosure Act...? HUD OCC FHA Consumer Financial Protection Bureau
Consumer Financial Protection Bureau
As the cost of borrowing money increases, the amount of lending activity will...? Increase Decrease Remain the same The cost of borrowing money is not related to lending activity
Decrease
The failure to fulfill a duty or promise is known as...? Execution Hypothecate Default Performance
Default
The minimum interest rate set by the Federal Reserve for lending to other banks is known as the...? Subprime rate Discount rate Starter rate Prime lending rate
Discount rate
When a borrower hypothecates their property, the lender will maintain...? AEquitable title BLegal title CInterim title DSecure title
Equitable title
The Farm Credit Administration regulates the ...........institutions? HUD CFPB FCS FDIC
FCS
Which of the following helps to limit the impact on the economy and the financial system when a bank or thrift institution fails...? AFDIC BFHLB CTILA DRESPA
FDIC
Default -
Failure to fulfill a duty or promise or to discharge an obligation; omission or failure to perform any act.
This is a federal prohibition on discrimination in sale, rental, financing, or appraisal of housing on the basis of race, color, religion, gender, national origin, handicap, or familial status...? Fair Housing Act of 1866 Fair Housing Act of 1968 ADA TILA
Fair Housing Act of 1968
Farmers and ranchers can obtain a loan through which of the following...? CRA CDBG Farm Credit System All of the above
Farm Credit System
The Federal Agricultural Mortgage Corporation is known as...? Farmer Mac Freddie Mac Fannie Mae Ginnie Mae
Farmer Mac
Which of the following has broad powers in controlling credit and the amount of money in circulation in the United States...? Attorney General Department of Finance Federal Reserve U.S. Comptroller
Federal Reserve
Promissory Note -
Following a loan commitment from the lender, the borrower signs a note, promising to repay the loan under stipulated terms. The promissory note establishes personal liability for its payment. The evidence of the debt.
A procedure whereby property pledged for a debt is sold to pay the debt in event of default in payments or terms is known as...? Police power Foreclosure Condemnation Hypothecate
Foreclosure
Which of the following is responsible for the implementation andadministration of U.S. government housing and urban development programs...? OCC FHA HUD FDIC
HUD
To pledge a thing as security without the necessity of giving up possession of it means to...? Record Acknowledge Notarize Hypothecate
Hypothecate
According to RESPA, a referral fee in the form of cash is considered a/an...? Commission Gift Illegal kickback All of the above
Illegal kickback
If demand is high and supply is low, real estate prices will...? Increase Decrease Remain the same Real estate prices are not related to supply and demand
Increase
Which of the following are responsible for bringing industries to a region in an effort to improve community growth...? Economic Growth Agencies Private Development Agencies Industrial Development Agencies Corporate Development Agencies
Industrial Development Agencies
The cost of borrowing money is expressed as a/an...? AInterest rate BFlat fee CCommission DVariable fee
Interest rate
The actual ownership of property is known as...? ALegal title BEquitable title CSecure title DRecorded title
Legal title
Mortgage insurance offers protection for the...? Borrower Lender Seller Buyer
Lender
The use of debt financing of an investment to maximize the return per dollar of equity invested is known as...? Collateral Hypothecate Leverage Pledge
Leverage
The secondary mortgage market offers ..............for the primary mortgage market? ALiquidity BSupply CBuyers DSupport
Liquidity
RESPA requires lenders to provide borrowers with which of the following...? Title insurance Closing Statement Loan Estimate Letter of Intent
Loan Estimate
Money that is easily obtainable is considered...? M1 M2 M3 M4
M1
The supply of less liquid money is considered...? M1 M2 M3 M4
M2
The supply of money which is the least liquid is considered...? M1 M2 M3 M4
M3
The United States Mint is responsible for which of the following...? AManufacturing U.S. coins BProducing U.S. Passports CProducing the Federal Reserve notes DProducing Immigration Certificates
Manufacturing U.S. coins
Collateral -
Marketable real or personal property which a borrower pledges as security for a loan. In mortgage transactions, specific land is the collateral.
If a borrower obtains an FHA insured loan and only makes a down payment of 5%, what must the borrower purchase...? Conventional Mortgage Insurance Mortgage Insurance Premium Private Mortgage Insurance Conforming Mortgage Insurance
Mortgage Insurance Premium
Which of the following is an example of using leverage in a real estate transaction...? AObtaining financing to purchase a property BPurchasing a property using all cash CInheriting a property from a family member DAll of the above
Obtaining financing to purchase a property
The Federal Deposit Insurance Corporation (FDIC) -
Preserves and promotes public confidence in the U.S. financial system by insuring deposits in banks and thrift institutions for at least $250,000; by identifying, monitoring and addressing risks to the deposit insurance funds; and by limiting the effect on the economy and the financial system when a bank or thrift institution fails.
This refers to a type of mortgage insurance required on conventional loans in which the homebuyer makes a down payment of less than 20% of the purchase price...? Private Mortgage Insurance Mortgage Insurance Premium Conventional Mortgage Insurance Conforming Mortgage Insurance
Private Mortgage Insurance
Foreclosure -
Procedure whereby property pledged for a debt is sold to pay the debt in event of default in payments or terms.
A borrower is said to be in default of their loan if they do not abide by the terms of the...? APromissory note BMortgage CDeed DPurchase contract
Promissory note
Which of the following serves as evidence of a debt...? Promissory note Collateral Title Credit
Promissory note
The Consumer Financial Protection Bureau oversees the enforcement of which of the following statutes...? CRA CDBG FDIC RESPA
RESPA
Which of the following statutes helps consumers become better shoppers for settlement services...? CRA CDBG FDIC RESPA
RESPA
Real Estate Settlement Procedures Act (RESPA) -
Real Estate Settlement Procedures Act (RESPA) - A consumer protection statute, first passed in 1974. The purpose of RESPA are:1) To help consumers become better shoppers for settlement services and2) To eliminate kickbacks and referral fees that unnecessarily increase the costs of certain settlement services.
Two or more consecutive quarters of negative growth is known as a...? Regression Rebound Recovery Recession
Recession
The Truth in Lending Act is also known as...? Regulation X TARP RESPA Regulation Z
Regulation Z
U.S. Department of Housing & Urban Development (HUD) -
Responsible for the implementation and administration of U.S. government housing and urban development programs.
The Farm Credit System provides loans for which of the following...? First-time homebuyers Commercial investors Urban developers Rural homeowners
Rural homeowners
The Housing Choice Voucher Program was formally known as...? Section 8 Section 12-A CRA TARP
Section 8
This refers to a type of loan granted to individuals with poor credit histories (often below 600), who, as a result of their deficient credit ratings, would not be able to qualify for conventional mortgages...? Prime mortgage Premium mortgage Discount mortgage Sub-prime mortgage
Sub-prime mortgage
The more money an individual has, the more purchasing power they have...? T (True) F (False)
T (True)
Which of the following is covered under Title 1 of the Consumer Protection Act of 1968...? HDIC TARP TILA RESPA
TILA
Regulation Z -
The Truth in Lending Act of 1968 is United States federal law designated to promote the informed use of consumer credit, by requiring disclosures about its terms and cost to standardize the manner in which costs associated with borrowing are calculated and disclosed.
Legal Title -
The actual ownership of property.
Federal Reserve System -
The federal banking system of the United States under the control of central board of governors (Federal Reserve Board) involving a central bank in each of twelve geographical districts with broad powers in controlling credit and the amount of money in circulation.
James needed to obtain financing to purchase a new house. What will most likely be used as collateral for James' loan...? The house James purchased James' car James' bank account James' old house
The house James purchased
Good Faith Estimate -
The lender's estimate of the borrower's settlement costs; RESPA is required to furnish it to the borrower at the time of loan application.
The Closing Disclosure must be revised if there is a significant change to which of the following...? The effective date of contract The loan's APR The closing location All of the above
The loan's APR
Primary Mortgage Market -
The marketplace whereby loans are originated.
Secondary Mortgage Market -
The marketplace whereby the loans that were originated in the primary mortgage market are bought and sold.
Discount Rate -
The minimum interest rate set by the Federal Reserve for lending to other banks.
Truth in Lending Act (TILA) -
The name given to the federal statutes and regulations (Regulation Z) which are designed primarily to insure that prospective borrowers and purchasers on credit receive credit cost information before entering into a transaction.
Interest Rate -
The percentage of a sum of money charged for its use. Rent or charge paid for use of money, expressed as a percentage per month or year of the sum borrowed.
An acceleration clause is included in which of the following...? The mortgage Both the promissory note and mortgage The promissory note The lien
The promissory note?
Equitable Title -
The right to obtain full ownership of property.
Leverage -
The use of debt financing of an investment to maximize the return per dollar of equity invested.
What happens when the Federal Reserve decreases the bank's required reserves amount...? Economic activity slows down There is a boost in economic activity Lending on real estate transaction decreases The real estate market stalls
There is a boost in economic activity
The economy generally grows when which of the following occurs...? There is an increase in the money supply There is a decrease in the money supply When the money supply remains even A decrease in the population
There is an increase in the money supply
Hypothecate -
To pledge a thing as security without the necessity of giving up possession of it.
Which of the following was designed primarily to insure that prospective borrowers and purchasers on credit receive credit cost information before entering into a transaction...? ATruth in Lending Act BOffice of the Comptroller of the Currency CTroubled Asset Relief Program DThe Federal Deposit Insurance Corporation
Truth in Lending Act
The Office of the Comptroller of the Currency falls under the control of the...? AU.S. Treasury BAttorney General CThe Federal Deposit Insurance Corporation DThe U.S. Central Bank
U.S. Treasury
Which of the following combines the Farmers Home Administration, the Agricultural Cooperative Service Administration and the Rural Development Administration...? Federal Agricultural Mortgage Corporation FCS Farm Credit System USDA Rural Development Program
USDA Rural Development Program