Chap 13 Flashcards
The two ratios used to determine whether a loan will be approved is
A housing expense ratio
Total obligations ratio
The process of risk evaluation is called
Mortgage Underwriting
An applicant is evaluated using these 3 steps to qualify for a loan
Credit history
Income
Other Assets
Income Ratio
What is it called when the percentage of the borrower monthly gross income which is required to make the monthly loan amount which is one twelve of the annual P.I.T.I
Housing Expense Ratio
What is the percentage of the borrowers monthly gross
income that is required to make the monthly loan payment
Total Obligations Ratio
The 3 types of mortgages are
FHA
VA
Conventional
FHA requires a borrowers credit score to be atleast
580
A down payment of how much is required for a FHA
3.5%
To qualify for a FHA loan a borrower must nit exceed a housing expense ratio of what percentage
31
A total obligation ratio of what percentage is required for a FHA loan
43%
M.I.P means
Mortgage insurance premium
H.U.D means
Housing and Urban Development
FHA means
Federal Housing Administration
When a lender forgives a debt, and allows a borrower to avoid foreclosure by entering a agreement with lender to sell property for less, this is called a
Short Sale
Benefits of a short sale
..Homeowner avoids foreclosure
…Being released from all or most debts
…Less credit impact , compared to a actual foreclosure
The standard loan to value ratio for a F.H.A LOAN IS
96.5
How many years does a FHA has for their maximum term
30 years
What is done to approve certain safety, security, & soundness / standards
Appraisal
When a fha loan is assumed this means
Subject to rate change
What type of units is not eligible for the F H.A Rehabilitation mortgage insurance program
Co-operative units
A veteran must pay this fee which is similar to a origination fee
Funding fee
Amount available for use on a loan is called
Entitlement
To qualify for a Va Loan a borrower must not exceed a total obligations ratio of
41%
A Va loan guarantees how much of losses with a foreclosure
25%
What type of mortgage is not insured or guaranteed
Conventional
A PMI is required when the loan amount exceeds how much %
80
The current eligibility period of days during a military conflict for a veteran to get approved is
90 days
This loan repayment method provides for payments of interest only during the term of the mortgage
Term Mortgage
Term mortgage is also called
Straight Term Mortgage
