Chapter 3 Introduction (Deed,Lien) Flashcards
The assignor: A. Transfers contract rights B. Receives contract rights C. Must be a United States citizen D. Must be an attorney
Answer A
The assignor is the party transferring contractual rights to another.
The document conveying title from one party to another and guaranteeing that the title is good is known as a: A. Good Faith B. Warranty Deed C. Usury limit D. Red Flags document
B
Under the Guidance on Subprime Mortgage Loans, the CSBS consider all of the following to be a predatory lending practice except:
A) basing a loan off the foreclosure value
B) Refinancing a or borrower repeatedly to collect more fees
C) Charging higher rates to risky buyers
D) Using fraud or deception to sell the loan
C) Charging higher rates to risky buyers
The party transferring the contact or rights to another is known as the A. Assignor B. Assignee C. attorney-in-fact D. Grantor
Answer A
The assignor is the party transferring contractual rights to another.
Which of the following is the most desirable form of real estate? A. Fee Simple B. Life Estates C. Leasehold Estates D. Tenancy Estates
Answer: A
Fee simple is the highest type of personal property interest in the law. A buyer owns the land as well as the improvements on the land.
The borrower does NOT sign which document: A. Deed B. HUD-1/Loan Disclosure C. Mortgage D. Note
Answer A
The borrower does not sign the deed. It’s the grantor and two witnesses who sign the deed.
Which of the following are fees incurred as a result of getting a home loan? A. Closing Cost B. Pre-Paid Cost C. APR fees D. Finance Charges
Answer A
Closing costs are generally the responsibility of the buyer. Oftentimes, however, closing costs are divided between the buyer and the Seller while negotiating the final home price.
What establishes the lien position? A. Date and time of signing B. Date and time the loan was approved C. Date and time of recording D. Date and time of the title search
Answer: C
The date and time of RECORDING establish lien position of the mortgage. Lien Position determines the order in which lien holders are paid when the property is sold.
Which federal agency guarantees mortgage backed securities that arebased on FHA and VA loans? A. FHA B. VA C. Ginnie Mae D. Fannie Mark
C
Which of the following are voluntary liens? A. Subordinate Liens B. Special Assessment C. Mechanics Lien D. None
Answer:A
subordinate lien is a Junior or second mortgage. A mortgage is a voluntary lien; special assessments and mechanic’s liens are involuntary liens.
Tenancy in Entirety does NOT have: A. Equal ownership B. Right of survivorship C. Only one individual’s name on title D. Buy at same time
C
Lis Pardens is also known as a A. Acceleration clause B. Mortgage due on Sale C. Notice of default D. equitable right of redemption
C
What is a transfer of title in which there is no new note and the original buyer retains all the liability? A. Assumption B. Novation C. Subject to the Mortgage D. Lis Pardens
Answer: C
Subject to the mortgage is a transfer of title in which there is no new note and the original buyer retains all the liability.
Which of the following is true of Fee Simple Estates?
A. Last only for the owner’s lifetime and then reverts back to the grantor or to named third parties
B. purchasing the land, the structures on the land, but air and mineral rights belongs to the government
C. The owner must abide by state and federal regulations including zoning, condemnation, health and building codes and taxation.
D. The owner has full control including including zoning, condemnation, health and building code
Answer C
Fee Simple ownership represents absolute ownership of real property (ascompared to leasehold estates, which involve a tenancy). However, even though the property is owned outright, the owner must abide by state and federal regulations including zoning, condemnation, health and building codes and taxation.
Tom had been in an accident and was in traction and unable to work and unable to pay his mortgage until he gets his settlement. Tom settlement came through and h received a large sum that can pay off the house. What should Tom do to keep his home? A. Ask for forbearance B. Equitable right of redemption C. Deficiency Judgement D. Mortgage Acceleration
Answer B
equitable right of redemption allows the mortgagor in default to pay
the entire balance due and keep the property from being foreclosed.
Lien Order What lien has the highest priority and is paid off first when a property issold? A. Property tax B. Senior mortgage lien C. Mechanic’s lien D. Judgment lien
A
Which of the following allows a purchaser to share liability with the previous owner and without the qualifications of the lender? A. Straw buyer B. Assumption C. Co-buyer D. Novation
Answer: B
Assumption is when the purchaser may take over the mortgagor’s monthly mortgage payments with the knowledge, but without the qualification, of the lender.
**Who can sign security instruments on a borrower’s behalf?
A. Anyone with Power of Attorney
B. Attorney-in-fact or Court Appointed Guardian
C. Spouse
D. Mortgage loan officer
The following persons may sign security instruments on a borrower’s behalf:
• An attorney-in-fact may sign
Court-appointed guardian may sign the security instrument if the borrower is not legally competent, And Borrower with power of attorney
What type of deed transfers ownership without making any guarantee of clear title? A. General warranty deed B. Special warranty deed C. Power of attorney deed D. Quitclaim deed
D
A mortgage lien on an entire tract of land is known as a: A. Buy-down mortgage B. Chattel mortgage C. Blanket mortgage D. Pillow mortgage
C
@@@The underwriter will require verification of employment. Which of the following will NOT serve this purpose?
- A notarized affidavit from the borrower
- Telephone call to the employer by the loan processor
- Paycheck stubs
- A written letter or completed form directly from the employer
A notarized affidavit from the borrower
A written instrument used to convey title or the transfer of ownership from the original owner (grantor) to the new owner Is know as a A. Deed B. Lien C. Title D. Security Instrument
Answer A
A deed is a written instrument used to convey title or transfer ownership.
Which parties sign the deed? A. Grantor, grantee and two witnesses B. Grantor and two witnesses C. Grantee and two witnesses D. Grantee only
B
Tom had been in an accident and was in traction and unableto work and unable to pay his mortgage until he gets his settlement. What should Tom do?
A. Not pay the mortgage until he received the money
B. File for bankruptcy
C. Ask for a forbearance from his lender
D. Call his mortgage broker to delay the payments
C
Forbearance is the choice by the lender not to take action even though the borrower is in default of the loan.
Mortgagors are responsible for certain promises, and are in default if they fail to do which of the following?
Who of the following is considered default if borrowers fail to pay?
A. Repay loan, interest rate, and keep property in good repair
B. Property, hazard and title taxes
C. Repay loan, property tax, hazard insurance and keep property in good repair
D. Hazard, Flood and Mortgage Insurance (PMI)
C
John had defaulted on his loan and now the lender had requested the whole mortgage balance due immediately, this is known as A. Mortgage Acceleration B. Equity Skimming C. mortgage due-on-sale clause D. defeasance clause
Answer: A
Mortgage Acceleration is when the lender demands payment in full due to default. Due on sales clause is when so,done refinances a different loan, the amount is due when that loan changes or is sold
Tenancy in Common does NOT have: A. Equal or unequal ownership B. Buy at same or different times C. Multiple owners D. Right of survivorship
D
For one person to sign a legal document for another person generally would be considered forgery, unless the person signing had:
- a close relationship with the person, i.e., spouse, child, or parent.
- There are no circumstances when this is legally allowable.
- legal power of attorney.
- a writ of being handicapped and unable to sign for themselves.
legal power of attorney.
The conveyor of the deed is the: A. Grantor B. Lender C. Grantee D. Mortgagor
Answer A
The grantor is the conveyor of the deed
Which is the opposite of the pre-payment penalty Clause? A. Defeasance Clause B. Pre-payment privilege C. Mortgage privilege D. Open-End Clause
Answer B
mortgage prepayment privilege clause allows the borrower to pay all or part of the loan before it is due without penalty.
The owner of the property is the A. Assignor B. Assignee C. Grantor D. Grantee
C
The grantor is the owner of a property.