Chapter 13 Review: Counseling Session-Preapproval and Agency Agreements

Question 1

As the buyer agent, your commission may be paid by the seller; the source of compensation does not create

Answer 1

agency

Question 2

___________ means that the potential buyer has met with a loan originator. If all representations made by the buyer are accurate, the buyer is qualified to borrow money.

Answer 2

Prequalified

Question 3

Pre-approval means that the buyer has submitted

Answer 3

an application for the loan

Question 4

A __________ is a pledge of property to the lender as security for the payment of the debt.

Answer 4

mortgage

Question 5

The ________ is the mortgagor; the ______ is the mortgagee

Answer 5

borrower

lender

Question 6

A note is __________ __ ___ ____; it is the IOU

Answer 6

evidence of the debt

Question 7

Amortization means a portion of the monthly payment is applied to the ______ and a portion is kept by the lender for ________

Answer 7

principal

interest

Question 8

The three entities of the secondary mortgage market that do not lend their own funds but make funds of others available for residential real estate financing are:

Answer 8

Fannie Mae
Ginnie Mae
Freddie Mac

Question 9

Mortgage bankers lend their own

Answer 9

money as well as investors’ money

Question 10

Mortgage brokers do not lend

Answer 10

any of their own money

Question 11

In order to be sold in the secondary market, a mortgage loan must be

Answer 11

conforming

Question 12

A _______ loan is not sold in the secondary market

Answer 12

portfolio

Question 13

PITI stands for ________, ________, _____ and ___________; this is the monthly housing cost.

Answer 13

Principal, Interest, Taxes and Insurance