Real Estate Finance
FHA
20% Financing
A buyer can obtain qualified mortgage
38%
Borrowers should be wary of lenders who offer mortgages at more than ______% over current market interest rates
5%
Which of the following describes a Treasury note?
A Treasury security with a maturity term between two and 10 years
Seller Jerome found financing that would include his current mortgage inside the buyer's mortgage. What type of mortgage is this?
A Wrap-around Mortgage
Collateralized Mortgage obligation
A debt security holder
Home Mortgage Disclosure Act
A federal law that requires lenders to annually disclose the number of loan applications and loans in certain areas, thus eliminating the practice of "redlining."
Deficiency judgment
A lender will file for this to recoup losses
Seller Jerome found financing that would include his current mortgage inside the buyer's mortgage. What type of Mortgage is this?
A wrap-around Mortgage
Summary of Title
Abstract of Title
If any montly installments under this note is not paid when due and remains unpaid after a date specified by notice to mortgagor, the entire principle amount outstanding and accured interest theron shall at onece become due and payable at the option of the Note holder?
Acceleration Clause
How are account number displayed in a credit reprot?
Accounts numbers are truncated for security purposes.
What do ARMS stand for
Adjustable rate mortgage
When a buyer takes over the seller's original loan with the lenders permission, this is called
An Assumption
when a buyer takes over the seller's original loan with the lender's permission, this is called
An Assumption
A CMA or a BPO is an example of
An informal estimate of market value
A Standerized measure for intrest rates and other costs of the loan is called?
Annual Percentage Rate
A standarized measure for interest rates and other cost of the loan is called?
Annual percentage rate
Which of the following net worth examples may a lender view most favorably?
Assets exceed liabilities
When a promissory note is sold, what is recorded in the countly land records
Assignment of the note
Which of the following is likely effect when the discount window is closed
Banks don't have acess to additional funds
USDA Farm offers
Building a new hay barn, building for farms and ranches
When borrowers started missing morgage payments how did this affect collateralized mortgage obligations
CMOs were not collecting the expected principal and interest pay ents due to the increase in defaults and foreclosures for their underllying collateral
A Short Sale
Can negatively impact the seller's credit and the lender may seek a deficiency judgment for the amount not repaid
The USDA Farm Service Agency
Can offer direct loans to farmers and ranchers. The loans are funded by congresional appropriation q
FDIC most likely will insure
Certificate of deposit
kaycie is a new employee at a mutual savings bank. During orientation she learned that mutual savings banks have limitations that are set by their
Charter
Fatima is using a VA loan to purchase a home from Sue. Sue agrees to pay Fatima's closing costs. which of the following statements is true?
Closing costs aren't considered a seller concession
If using a VA loan to purchase a home from another person and they agree to pay closing cost. Which of the following statements is true?
Closing costs aren't considered a sellers concession.
Commercial banks offer interim financing in the form of ______________, Loans
Construction
Commercial banks offer interim financing in the form of _______________, loans
Constuction
Fannie Mae
Conventional FHA insured, Va guaranteed loans
Interest only loans are a form of ___________buyer financing
Creative
Commercial banks derive most of their funds fro mortgage on
Demand and Deposits
Commercial paper as collateral is called
Discount Point
Administrative Procedure Act
Enacted in 1946
HELOC
Equity
Conventional loans from larger commercial banks
Fannie Mae
Federal Housing Finance Agency
Fannie Mae
A Government Sponsored Enterprise GSE
Fannie Mae and Freddie Mac
Fannie Mae and Freddie mac use guidelines for conforming loans set by the
Federal home Financing Agency
ARM
Fixed to Adjustable
Which agency is sponsored by the GSE
Freddie Mac Government Sponsored Enterprise
The Government National Mortgage Corporation was created in 1968 under the (HUD) and is more commonly known as
Ginnie Mae
The interest rate on FHA section 251 adjustable rate mortgage will
Go up or down, but can't change more than a maximum number of points allowed by the FHA over the life of the loan.
The interest rate on a FHA Section 251 adjustable rate mortgage will
Go up or down, but can't change more than a maxium number of points allowed by the FHA over the life of the loan.
When mortgage monthlypayment increase over time according to a set schedule this is
Growing equity
Ginnie Mae
HUD-Government nation Mortgage Corporation 1968
Veterans who use the VA's Specially Adapted housing grant must?
Have permanent and total service connected disability
Wendy is buying a house from Tom. Tom helps Wendy out by paying for 2-1 buydown. The lender has given Wendy an interest rate of 5% . Which of the following describes what the buydown will do to Wendy's interest rate?
Her rate will be 3% for the first year 4% the second year and 5% after that.
Recovery Phase in real estate market
High but stabilized unemployment and a high number of foreclosures
Historically, what do property values tend to do over a long period of time
Increase
Only ____________, is paid until the end of a straight mortgae loan term, when the principal is repaid in full
Interest
Which of the following is a true statement about deducting interest on mortgages taken out in tax years between 2018 to 2025?
Interest on the first $750,000 of mortgage debt is deductible for married couples filing jointly or $375,000 for couples filing separately
Whats the purpose of a typical subordination agreement
It allows a junior mortgage to move into first lien position
HUD's Good Neighbor program
It allows qualified individual to buy a home at a 50% discount with a $100 down payment
Which of the following best describes a Blanket Lien
It gives lenders the ability to recover loses due to a foreclosure sale from any current or future property the borrower owns.
Which of the following describes a blanket Lien?
It gives lenders the ability to recover losses due to a foreclosure sale from any current or future property the borrower owns until the losses are recovered.
what is the purpose of the loan estimate
It gives the buyers an idea of loan so they will be able to make an informed decision about the loan.
Subordination agreeement?
Junior Mortgage to move into first position
Services performed by a third party that the lender selects
Loan Estimate form "Includes fees for
Which of the following loan types can be packaged into a mortgage-backed security eligible for gurantee by Ginnie Mae
Loans insured or guaranteed by U.S. government agencies
which of the following loan types can be packaged into a mortgage-backed security eligible for guarantee by Ginnie Mae?
Loans insured or guranteed by US Government Agencies
When a ARM makes its initial adjustment, it does so to its fully indexed rate?
Margin plus index
Liens can be
Mechanic's and materialman's or junior liens
Store of value, unit of account, and what other factor define money?
Medium exchange
How much of a mutual savings banks assets come from saving accounts?
More than 70%
Lock In clause
Mortgage provision which prevents the loan from being paid off early.
The Dodd-Frank Act is created 2007-2008 and responsible for subprime loans
Non-bank lenders
Your neighbor is a nurse does she qualify for the Good Neighbor program?
Not unless she is a EMT, only EMT are qualified along with fire fighters, teachers, law enforcement
Jac is selling his unencumbered property to Shem and is acting as his lender in the transaction What type of finance instrument can Jacob use for the loan agreement?
Note with mortgage note with deed of trust, contract for a deed
SAFE-Act requires that mortgage loan originatiors
Obtain a license
A qualified mortgage is
One that meets certain lending standards
Whts another name for the Homeowners Protection Act
PMI Act of 1998 Homeowners protection act
What takes place in the secondary market
Packaging loans into mortgage backed securities MBS and sold to investors
Listing in the contract "At closing" or Before closing"
Page 2 closing disclosure the amount is to be paid
Which of the following can a lender do if a borrower fails to keep homeowners insurance on the collateral property?
Place lender-acquired insurance on the property and bill the borrower
Local Government involved
Planning
Which of the following best describes the state of the market during the over supply phase in real estate cycle
Properties selling for more than their appraised value many buyers in the market and lots of new construction
The Home Mortgage Disclosure Act
Protects demographic information not be shared with anyone.
Mortgage REIT
Real Estate Investment Trust involves residential and commercial properties
Two examples of loan adjustments or modifications are moratorium and
Recasting-Reconfiguing
Which of the following made mortgages attractve to investments?
Rising home prices, prior to the 2007 financial collapse
Hugh works as a loan officer at a bank. Because of the _____________, he must be registered with the nation wide Mortgage Licensing System
SAFE ACT
Hugh works as a loan officer at a bank. Because of the ____________,He must be registered with the Nation wide Mortgage Licensing System?
Safe Act
Long and short term debt instuments are called
Securities
What is the most common structure for a CMO
Sequential Pay
Mechanics lien
Specific and involuntary
The FHA _________________, program allows a borrower to refinance an FHA loan without verifying income or assets
Streamline Financing
How much of the monthly payment is principle and intrest
Subtract the taxes and insurance from the montly payment to get the amount for principal plus interest
Moratorium
Temporary Suspension
Which act requirs that individual making more than five " owner financed" loans per year obtain a residential mortgage loan origination license
The Texas Safe Act
Evaluates Loan Application
The Underwriter
The signature lines on the multi-state Fannie Mae promissory not are set up for
The borrower to sign
The FHA Energy Efficient Mortgage allows modifications such as solar panels as long as
The cost of the modification is within limits based on the value of the home
The annual MIP is recalcullated each year using __________?
The end of year loan balance after the next 11 payments
Acceleration Clause
The lender can call the loan due and payable if the borrower defaults on the loan
Right of Recission
The lender has three buisness day or the latter of either the date that the loan application is submitted or the date the disclosure is made, during which the borrower can cancel their loan.
What does it mean when the insurance company uses participation financing?
The life insurance company paticipates by taking partial ownership of the project in exchange for funding the loan.
the annual MIP is recalculate each year using
Then end of year loan balance, plus the balance after the 11 payments
Mutual savings banks prefer to keep their lending activities in their immediate geographic area. Why
They prefer to personally monitor loans they issue.
Which of the following statements is true about national lending intuitions?
They sell packaged loans to investors
What is a reason a borrower would choose to split or piggy aback loan option
To avoid going over the conforming loan limit
What is the purpose of the fixed adjustable rate note
To convert the interest rate from fixed to adjustable
When you recieve a loan Estimate from your lender what is the purpose of this document
To detail the estimated closing costs for the Loan
Which of the following statements is true about the Federal Reserve
Twelve district banks comprise the FED, with 14 year terms
Troubled Asset Relief Program
U.S. treasury to spend hundreds billions of dollars to stabilize, financial system boost credit markets to help familile avoid foreclosure and promote economic growth.
Voluntarily conveys his property to his lender
Voluntary conveyance of a deed
A lapse in property insuurance coverage can result in borrower dfault because it leaves the lend
Vulnerable
In what situation would the U. S. Treasury be most willing to sell securities
When the government bills exceed income collected
Mutual savings banks were created to serve ______________, during the mid 19th century?
Workers
Mutual savings banks were created to serve during the mid 19th Century
Workers during the industrial expansion of the mid 19th century
Non-Recourse Mortgage
a clause that prohibits the lender from suing the borrower for unpaid amounts if foreclosure occurs
Partnerships among mortgagees
a partnership each mortgagee receive a share of the mortgage payment
When a bank becomes insolvent what methods are used
assumption and pay out
A tax free gift
cant be more than $15,000 to any individual annually
Private loan companies may
charge higher fees and need collateral to secure the loan
What role did CMO's play in the financial crisis of 2007
fThey increased market speculation
Lien Holders are paid from the
from the after the auction is held if; the sale doesn't tnet enough to repay all lien holders, they are repaid in order of priority. Some junior lien holders may not get anything
Loans create
future cash income
43% of a debt to income ratio
is unwavereing
When mortgage packages are sold
it provides additional cash flow for new loans
Mutual saving banks lending activities are limited by
its Charter and vary from state to state
HUD's Housing Choice Voucher program helps
low income tenants with rental assistance that is paid directly to the landlord.
The FHA has a mission
of stabilizing the mortgage market
Freddie Mac
only considers the total debt to income ratio
FHA Loan
only requires a down payment of 3.5%
FHA
provides mortgage insurance for home loans
Paid by others "L" on a contract Indicates
the creditor pays the item at consumation
With a interest only payment
the interest only last for a few years and then when the loan term is over the borrower has to repay the entir principal. This is a Lump Sum payment. Some time people will refinance the loan when this happens.
Fannie Mae considers
total and housing debt to income ratio
To fund you children college education you can use the
use a loan based on the equity amount available is a home equity loan
HAMP, Home Affordable Modification Program
was created as part of the Homeowner Affordibility and Stability plan
Junior Lien
when a second loan places a lien against property already pledged as collateral, it creates a ?
Echo Boomers
when generations financed their homes due to also having other debt obligations
Negative items in a credit report
you would most likely see Lien
What is the acronym for the legislation that requires lenders to make full disclosure of the terms and conditions of cred
TILA Truth in Lending Act
