CE Shop Finance Missed Questions
participation certificate
A ___ is a mortgage-backed security issued by Freddie Mac.
Note with deed of trust
A beneficiary, trustor, and trustee are the parties involved when the finance instrument is a ______.
A junior lien to the property
A homeowner has been paying her mortgage for several years and has built up equity. She decides to take out a home equity line of credit because she needs some cash. This credit will create a ___.
Annual percentage rate
A standardized measure for interest rates and other costs of the loan is called_____.
Alienation clause
Albert wants to sell his house to his cousin, who's willing to assume his FHA loan. What clause in Albert's mortgage requires him to obtain the lender's permission to do this?
General Partnership
Ann went into business with Burt and Cindy and called their entity ABC Realty. They're a legal business structure but there are no state requirements to register their business. A contract between the three specifies the terms of their ownership and contributions. What business structure is this?
Judgement liens
Armitage Bank is placing the Kellermans in default for failure to pay their homeowners insurance. The lender is concerned about property damage and ____.
One year
Chanel is buying a brand new home with a VA loan. She's obtained a certificate of reasonable value. For how long is that CRV valid?
Fines up to $5000 and up to a year imprisionment.
Community Banks is being sued for intentionally violating the Truth in Lending Act. What fines and imprisonment possibilities can the company face?
Farmer Mac
Farm and Country Bank provides credit to the farmers, ranchers, and other rural residents of its community. What government program helps the bank maintain enough capital to fund those loans?
Conventional
Freddie Mac targets which type of loans to purchase?
Lending practices
HMDA requires lenders to collect, maintain, and report data on which of the following?
At least six months
How much should the emergency fund hold, according to the recommendation for creating a responsible financial plan for personal finances?
Liability after Foreclosure
If your lender forecloses on this property and the foreclosure does not cover the amount of the unpaid balance on this loan, State law may protect you from liability for the unpaid balance, unless you refinance or take on additional debt on the property.
Recovery
In which phase of the real estate market cycle would you expect to see property undervalued and a large supply of homes on the market?
Note with a mortgage, note with deed of trust, or contract for deed
Jacob is selling his unencumbered property to Sham and is acting as a lender in the transaction. Which type of finance instrument can Jacob use for the loan agreement?
Participation
Joe works for a life insurance company that funds commercial investment projects and often insures these projects by insisting on an equity position. What type of financing does this describe?
180
John wants to do a 1031 tax exchange. He just sold his property. How many days does he have to close on a new property?
Participation
Life insurance companies sometimes like to insure their investment in commercial projects by insisting on an equity position. This is known as ____ financing.
Rent covers the mortgage
Randolph is a real estate licensee whose fluctuating income wouldn't qualify him for conventional financing. However, he's able to get financing on a 10-plex. How is this possible?
Joint Venture
Someone with great carpentry skills pairs up with someone with working capital to purchase an investment property. This is known as ____.
Native Americans living on tribal land
Special mortgage loan programs for ____ include the FHA248 and HUD 184 programs?
A change in zoning ordinances
Suppose you live and work in the north-central US. Which of the following factors would have a direct impact at the local level?
USDA Rural Development Single Family Housing Program
Sylvia is a single mother living in a small town surrounded by ranch and farm land. What government program might provide her with a direct loan to purchase a home?
Lending
The Community Reinvestment Act (CRA) requires lenders to post their policies on what?
Farm Credit Administration (FCA)
The Farm Credit System is overseen by the ____, an agency of the federal government.
Housing and Economic Recovery Act of 2008
The ___ Act was legislation aimed primarily at addressing the effects of the subprime mortgage crisis.
Administrative Procedure Act
The ____ was enacted in 1946 to the creation of several new federal agencies. It established a process for how the agencies could propose and establish regulations.
Federal Funds
The rate in which a bank can obtain an overnight loan from another bank without providing collateral is called the ____ rate.
There must be a consistent track record of payment or the payments must be the result of a court order.
Tina is applying for a home loan. In order for child support payments she receives to be considered in the income evaluation by her lender, what must be true?
It restricts the owner's use or decreases the value.
What are the effects on a property if it includes an encumbrance?
Strengthen the housing market to bolster the economy and protect consumers.
When HUD pursues actions that are designed to restore the financial health of the Federal Housing Administration, which of its goals is it supporting?
Certificates of deposit
Which of the following is the FDIC most likely to insure?
Conversion of properties
Which of the following items directly increases the supply of real estate properties on the market?
670-739
Which range of credit scores represents the average score for Americans overall?
It allows the lender to recover losses incurred in the foreclosure process.
which of the following best describes the function of deficiency judgment in the case of foreclosure?
Payment schedule, APR, finance changes, pre-payment penalties, late penalties, and local financed amount.
Wendy has been approved for her first mortgage. The lender advertised 4.6% interest rate. She's nervous about the terms and fees. What information is the lender required to provide?
Property dimensions
What information would an appraiser record in the Site section of the Uniform Residential Appraisal Report?
The reserve percentage is increased by the Fed.
What is a potential cause for a decrease in local economy driven by the Fed?
A form of reverse mortgage insured by the FHA.
What is the HECM program?
Both mechanic's and materialman's liens are junior liens.
What of the following statements about liens is true?
None
What percentage of closing cost can be included in a VA loan?
Partnership between mortgagees
What type of partnership is a real estate mortgage investment conduit?
Insures lenders against loss from borrower default
What's a key feature of the Federal Housing Administration's loan program?
Formal Appraisal
What's another term for a valuation that's an unbiased opinion of value?
Returns on investment increase
When interest rates increase, what is the impact on mortgage-backed security investors?
American Taxpayer Relief Act of 2012
Which act made some mortgage insurance premium deductions available to certain taxpayers?
American Recovery and Reinvestment Act of 2009 (ARRA)
Which act, which was the first act passed to address the subprime mortgage crisis and was also known as "the stimulus package" sought to create new jobs and save existing ones, spur economic activity and invest in long-term growth, and foster new accountability and transparency in government spending?
The Federal Housing Finance Agency
Which agency regulates FHL Banks?
The Consumer Financial Protection Bureau
Which agency sets the guidelines for qualified mortgages?
Reconveyance
Which clause in the deed of trust is the equivalent of the defeasance clause in the mortgage?
Power of sale
Which clause is standard in a deed of trust or security deed and affects the foreclosure process that can be used if the borrower defaults?
Loan Estimate
Which document provides an estimate of the costs a buyer is likely to pay at settlement before the closing?
Federal Farm Credit Banks Funding Corporation
Which entity provides disclosures and public information about the financial condition of FCS?
Satisfaction of Mortgage
Which mortgage related document is the equivalent of the deed of reconveyance used with a deed of trust?
Duplex, office building, or warehouse
Which of the following could an investor who sells an apartment house buy using a 1031 exchange?
Banks focus lending offerings on local business and residents.
Which of the following describes mutual savings bank loans?
Non-profit status
Which of the following is NOT a benefit government-sponsored enterprises receive?
Limited Partnership
Which of the following is a passive type of real estate investment?
The promissory note is endorsed to the new owner of the loan
Which of the following is a true statement about when a promissory note is sold?
Institutional money market funds
Which of the following is classified as the least liquid on the scale?
Fannie Mae
Which of the following is regulated by the Federal Housing Agency?
Loans insured or guaranteed by US government agencies
Which of the following loan types can be packaged into a mortgage-backed security eligible for guaranteed by Ginnie Mae?
Conventional
Which of the following loans may require compliance with Appraiser Independence Requirements?
A decrease in money in the economy
Which of the following results from the Treasury selling securities?
Rental Income
Which of the following taxes apply while an investor holds an investment property?
Contract for deed
Which real estate finance instrument includes the promise to repay and the security instrument within the same document?
Fannie Mae
Which secondary market player would be interested in purchasing a loan from a commercial bank?
Government
Which type of loan is insured by the Federal Housing Administration?
Hybrid REIT
Which type of real estate investment trust derives its income from the rent or sale of property and interest dividends?
The payee (lender)
Who holds the promissory note while its being repaid?
The right to foreclose if the borrower defaults
Larry obtained a mortgage from State Bank. Larry owns the property, controls it, and has all the rights that come along with real property ownership. State Bank has an interest in the property and one other right. What is that?
Dodd-Frank Wall Street Reform and Consumer Protection Act
The _____ was enacted in 2010 to create stricter regulation of the financial services and industry to reduce costs for consumers from, undisclosed kickbacks.
Mortgage payment
The acronym PITI is a reference to what real estate-related concept?