Finance

Which agency is responsible for the production of paper currency?

bureau of engraving and printing

Which of the following would be the best place to keep monies intended for long-term savings?

certificate of deposit

Jonathan is selling his home to Chris and Samantha. Hes at closing and the underwriting fee must be paid. Who pays for that?

chris and samantha

Which of the following is a true statement about an IRA?

contributions to a SEP IRA are pre-tax contributions

Rather than be foreclosed on, Jarod turned his deed over to his bank. This is called a ______.

deed in lieu

The rate at which a bank can obtain a loan from its Federal Reserve bank when using commercial paper as collateral is called the ______ rate.

discount rate

Dan is being sued by a former client who feels that Dan didn't provide him with adequate service. Which of the following insurance coverage will Dan need?

errors and omissions

Chapter 5 of the texas property code sets requirements and penalties for __________.

executory contracts

_________________ creates a secondary market for agriculture by buying the loans, pooling them, and selling them as securities.

farmer mac

which agency receives paper currency prior to distribution but after its printed?

federal reserve

Allen picked up remodeling skills from his family's construction business. Which of the following real estate investments is most suited to these skills?

fix and flip

Which of the following is NOT an accurate statement regarding the title?

foreclosed properties rarely have clouded titles

One of the following entities is primarily a secondary market player. Which one?

freddie mac

What type of value may consumers be interested in if they are looking for the potential rate of return

investment value

What primary benefit does a living trust have over a will?

it avoids probate

Which of the following best describes a blanket lien?

it gives lenders the ability to recover losses due to a foreclosure sale from any current or future property the borrowers can own

Whats the advantage of using seperate savings accounts for each financial goal?

it helps you see progress toward savings goals

Which of the following best describes the non-judicial foreclosure process?

it may be used if the deed of trust includes a power-of-sale clause.

Why might you seek the help of a tax attorney rather than a CPA?

legal tax issues are involved

In the secondary mortgage market, how are mortgages grouped and sold together?

mortgage backed securities

Why is it a good idea for real estate licensees to carry auto insurance?

most states require it and its recommended for all real estate licensees

What piece of information would an appraiser not find in the subject and contract sections of the report?

neighborhood characteristics

Which is one of the benefits of the USDA loan programs?

no down payment required

Which of the following is a true statement about retirement accounts?

only self-employed individuals can use SEP IRAS

______________ taxation means that the business income passes through to the business owners individual tax return rather than being taxed as a separate entity.

pass-through

What information would an appraiser record in the site section of the uniform residential appraisal report?

property dimensions

Whats the term for a loan modification in which the outstanding loan balance is reconfigured?

recasting

Which of the following is a required part of a sound plan for your personal finances?

review your plan on a regular basis

Zach and April are purchasing a home. They apply to three different lenders and review the loan estimate they receive. Each form includes a field identifying the national mortgage licensing system ID number for the lender. What is th

safe act

Which act establishes general requirements that state agencies must follow when adopting rules or conducting contested cases?

texas administrative act

Which of the following statements about the torrens system is true?

the approach is only used in a handful of states

Joyce and Danny purchased a home in 2009 for $280,000. They received a homebuyer credit of $8000. Their friends Margie and Scott purchased a home in 2010 for $320,000. Margie and Scott did not receive a home buyer credit. Why not?

the homebuyer credit was part of the stimulus package enacted in 2009 and was only effective between jan and dec of 2009

The FHA has helped to significantly improve the mortgage market through__________________.

the introduction of the long-term amortized loan

The percentage recommended for a licensee to allocate when building an emergency fund is ________.

the largest percentage possible after paying all essential expenses.

Which of the following describes the federal funds rate?

the rate at which a bank can obtain a loan from another bank

When the Torrens system is used to perform a title search, who or what entity acts as a title guarantor in case a claim is filed?

the state

If someone dies without a will and has no next of kin, what happens to the deceased persons assets?

the state can claim assets

Who distributes the trust assets of person who died?

the successor trustee

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

title insurance policy

what is the purpose behind appraiser independence requirements?

to protect appraisers ability to assess an accurate value for a property by avoiding outside pressure or influence

A debenture is also known as a ___________ bond.

unsecured

How long does a homeowner have to pay outstanding liens against his property?

until the foreclosure sale is held

Which of the following is a description of leveraging?

using a small amount of cash to obtain a loan of a larger amount

When shopping for health insurance, which of the following criteria can you likely discount as less important than the others?

using the same carrier you had before

Rather than face foreclosure, Tony decides to cut his losses. He voluntarily conveys his property to his lender. What type of foreclosure alternative is this?

voluntary conveyance of deed

The mortgage disclosing act gives applicants a three-day ________ to review and approve the loan estimate & closing disclosure form.

waiting period

What is a government-sponsored enterprise?

A private company the U.S. Congress created to make certain borrowing easier and cheaper

Which of these business structures offers personal liability protection in the event of a lawsuit against the licensee business?

LLC

When considering liquidity , which category is least liquid?

M3

Which organization manages and charters credit unions?

NCUA

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

New liens can threaten the lenders position as primary lienholder. default can occur for this reason

What percentage of closing costs can be included in a VA loan?

None

Whats the definition of a qualified mortgage?

One that meets stringent CFPB guidelines

Which of the following resources are extremely helpful when working with investors?

REIT analysts and bond rating agencies

Contributions for this type of IRA arent tax-deferred

Roth

Sally, Larry's appraiser, has provided her with a title commitment and indicated there's a problem with the title. Where can Larry find the requirements that must be met before a title insurance policy will be issued?

Schedule B-1

Assets from the estate of which individual avoids probate at that individuals passing?

Scott, who died leaving all of his assets in a living trust

The mortgage disclosure improvement act amends __________ in terms of the timing of lending disclosures.

TILA

Why does the federal government have agriculture lending programs?

To ensure that credit is available to agriculture producers, who often can't meet conventional underwriting standards due to the nature of their work

Which of the following would be a receipt you should save for tax purposes?

a toll fee for a business trip

What does it mean if the Fed increase reserve requirements?

member banks must keep more assets on deposit at the reserve bank

Which of the following best describes a recourse mortgage?

allows the lender to sue the borrower for damages if foreclosure occurs

When you develop your financial plan, you should start by _____________.

identifying your personal values

Marcie bought a duplex, lived in one half, and rented out the other half. This is an example of what type of investing?

buy and hold

Who is responsible for paying the loan origination fee in a financed real estate transaction?

buyer

Who is responsible for paying the loan-related closing costs ina. financed real estate transactions?

buyer

Katrina wants to find a way to curb her spending. She has decided to take a look her variable expenses. Which of the following is a variable expense?

clothing

Don uses one hour each week to perform certain tasks, including _____________, as part of his personal financial system.

paying any bills that are due

Which of the following is an option that might allow a licensee without much work history or very many assets to finance a real estate investment?

seller financing

What term is used to describe the housing inventor in default or foreclosure

shadow inventory

With this alternative to foreclosure, borrowers receive permission from their lender to sell the property for less than the amount owed on the borrower's mortgage.

short sale

Declan has a mortgage on his property, but allows the property to fall into disrepair. Which of these is a possible consequence of this action?

the lender can put Declan's loan on default

Which of the following describes the discount rate?

the rate at which a bank can obtain a loan from its federal reserve bank when using commercial paper as collateral

Which of the following describes the primate rate?

the rate at which a bank or lender may loan money to its creditworthy borrowers

Which of the following describes the federal fund rates?

the rate in which a bank can obtain a loan from another bank

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

the trustee executes and records a deed of reconveyance and the lender returns the note to the borrower

Licensee Lynn has several accounts set up as part of her personal financial plan to help her manage cash flow. She's allocated 10% of each commission check to business expenses, 15% to taxes, 8% to her retirement fund, 12% to various savings goals, and the rest goes to her living expenses. When she receives a check, how does she direct the funds?

after depositing it in her business checking account, she puts 90% of it in her personal checking account to be distributed to other savings accounts as appropriate.

Which government program assists rural Americans by offering loans, grants, and loan guarantees for housing?

USDA rural development

Which of these individuals may benefit from USDA rural development program offerings?

community manages lenders

If you have a specific health issue, which of the following is most critical for you to thoroughly investigate when selecting health insurance?

covered events

Amos is a new licensee who has just earned his first commission check. What should he do with it?

deposit it into a business account separate from his personal account

Morris still owes his lender for the financing obtained in purchasing his home. Several years later, Morris took out a home equity line of credit. This means that ______.

if morris is foreclosed on, the home equity line of credit wont be paid until morris first loan is paid off

Someone with great carpentry skills pairs up with someone with working capital to purchase an investment property. This is known as __________.

joint venture

when consumers make a small down payment, borrow the remaining amount of the purchase price from a lender, and reap rewards off of the full investment value, they are demonstrating what concept?

leveraging

Because of the secure and fair enforcement for mortgage licensing act, borrowers can determine if their mortgage loan originator is ______________.

licensed and registered

In the early 2000s before the 2007 financial crisis, how would you characterize the real estate market?

low interest rates and high property values.

A mortgage with a clause that prohibits the lender from suing the borrower for unpaid amounts if foreclosure occurs is called a _________________ mortgage.

non-recourse

Landon will pay interest over the life of his 30-year loan. What other responsibility does he have to lender Marco when he finances his loan?

pay loan-related closing costs