Chapter 9: Finance Flashcards
With what type of clause does the entire balance of the loan become due and payable when an owner is alienating, transferring, or conveying a property?
Alienation Clause
The practice of purchasing real estate using a small amount of your own money and a large portion of borrowed funds is known as:
LEVERAGE
Moneys collected in advance from borrowers to assure the payment of recurring costs are known as:
impound accounts
Which of the following liens are NOT eliminated by a foreclosure sale?
Federal tax liens
state, county, city assessments
state, county and city taxes
Another term for the trustee is
Third Party
A clause in a financial instrument that allows a lender to demand immediate payment of the entire note balance is known as a(n):
acceleration clause
What document does a trustee record after being notified by the lender of the trustor’s nonpayment?
Notice of Default
What do we call a borrower who secures a loan through a trust deed?
Trustor
What provision in an instrument of finance would permit a change in the priority of liens on a property?
subordination clause
What type of loan allows the interest rate to “fluctuate” depending on money market conditions?
adjustable rate mortgages
Should the trustor default, the trustee may have to sell the property for the:
Beneficiary
Which of the following is NOT a party to a trust deed?
Grantor
The trustor is also known as the
borrower
The trustee issues a “reconveyance deed” when the promissory note is:
paid in full
A person who takes a negotiable instrument from another with no knowledge of defect is called a(n):
holder in due course
