Documentation Flashcards
This form allows the lender to collect information about the borrower/property.
Uniform residential loan application
This serves as protection for the creditor, motivation for the debtor – make sure terms of notes are fufilled and note is paid as agreed.
Promissory note
This requires debtor to hypothecate property as condition of the loan (pledge property as collateral without giving up possession of the property).
Promissory note
An estimate or opinion of value as of a certain date that is supported by objective data.
Appraisal or 1004
This appraisal approach is often used in evaluating residential property. It also requires a minimum of three comparables.
Sales comparison approach
This form is required to give the lender permission to request copies of federal tax returns.
4506 – T
The borrower is called the trustor, the lender is the beneficiary who retains the note and deed of trust, in the trustee holds legal title to secure the property described and deed of trust subject to terms of trust for a wonder benefit.
Trust deeds or deed of trust
Overtime and bonus pay must be consistently received for a period of how long in order to be used for income qualification?
Two years
What percentage of ownership in the business is considered self-employment?
25%
The rate lock is really shown on which document?
Loan estimate
W-2 employees should have continuous employment for at least how many years in the same field?
2
What percentage of income derived from a 1099 income is considered self-employment?
25%
This note is typically accompanied by a security instrument.
Promissory note
This document generally must contain the actual terms in costs of the transaction.
Closing disclosure
A loan estimate can only be revised based on one of what three valid changes of circumstance?
- An event that is beyond the control of a creditor or borrower, such as a natural disaster which increased settlement costs.
- Information that was Nona or provided at the time of the application changed, such as interest rate increase loan terms or settlement service provider charges
- New information regarding the borrower or the loan that the creditor did not rely on one supplying the loan estimate, such as the borrower becoming unemployed prior to closing.
An appraisal must be recertified if it is how old the closing?
Four months or more
If a revised loan estimate is needed, it will need to be mailed or given to the borrower no later than when?
Three business days after the creditor learns of the reason for the revision.
This appraisal approach compares the property being appraised with other similar properties, comparables or comps, sold recently in the same market area, best for residential properties.
Sales comparison approach
What five documents can be considered other documentation?
Appropriate W-2, original paystub’s, verification of employment, verification of deposit, verification of rent, verification of mortgage.
This appraisal approach is used when evaluating the cost to replace property that was damaged due to natural disasters. It is also called the replacement cost approach.
Cost approach
A final closing disclosure is delivered win?
At closing
If the borrower doesn’t provide all data on this document during initial consultation, missing information must be provided at a later date, which will delay the loan process.
Uniform residential loan application
According to the real estate settlement procedures act these two documents must be given out after settlement.
Annual escrow statement and servicing transfer statement
Pay stubs are required for what amount of time?
30 days
Non-numeric clerical error’s in tolerance violations trigger a new closing disclosure that must be delivered when?
Within 60 calendar days following loan closing
This is signed by the borrower and evidence is a promise to pay (the borrowers obligation to repay the debt to the lender).
Promissory note
This appraisal approach calculates the cost of the land, site improvements, the cost to build the structure on the land, and the cost of any depreciation to the property to reduce the property. The best for relatively new construction or four unusual or special purpose.
Cost approach
Freddie Mac’s uniform residential loan application.
Form is 65
The closing disclosure must be delivered to the borrower how many days prior to loan confirmation?
Three business days
This appraisal approach estimates the value of the real estate by analyzing the revenue, or income, the property currently generates or could generate. That was widely used with commercial or investment properties.
Income approach
Uniform residential appraisal report is known as what form?
1004
What are the four other income considerations?
Retirement/pension, alimony or child support or maintenance, tax-free/public assistance income and rental income.
And appraisal must be recertified if it is how old at closing?
Four months or more
Instruments placed in specific financial interest in title to real property into hands of this interested third-party as security for payment of note.
Trust deeds or deed of trust
An estimate or opinion of value as of a certain date that is supported by objective data.
Appraisal or 1004
This gives the lender the right to declare entire loan balance due immediately because of borrower defaults or for violation of other contract provisions.
Acceleration clause
Are you self-employed borrower needs what two tax returns for a minimum of two years?
Personal and corporate
Trust deeds (nonjudicial foreclosure) and mortgages (judicial foreclosure) are examples of two types of what?
Security instruments
According to the real estate settlement procedures act, these four documents are to be given out at or within three business days of the application.
- Homeloan toolkit
- Loan Estimate
- Mortgage servicing disclosure statement
- List of hud approved counselors
This appraisal approach is used when evaluating the cost to replace property that was damaged due to natural disasters. It is also called the replacement cost approach.
Cost approach
When is the closing disclosure has been delivered, can a borrower receive a revised loan estimate?
No
According to the real estate settlement procedures act this disclosure must be given out three days prior to confirmation.
Closing disclosure
Tax free/public assistance income may be “grossed up” by how much?
25%
With the context of the deadline for providing the initial loan estimate, a business day is considered what?
Any day on which a creditor is open to the public for the purpose of conducting regular business.
This appraisal approach calculates the cost of the land, site improvements, the cost to build the structure on the land, and the cost of any depreciation to the property to reduce the property. The best for relatively new construction or four unusual or special purpose.
Cost approach
This gives the lender certain stated rights when there is a transfer of ownership in the property a.k.a. due on sale clause.
Alienation clause
According to the real estate settlement procedures act this document must be given out within 45 days of closing.
Initial escrow statement
Trust deeds (nonjudicial foreclosure) in mortgages (judicial foreclosure) are examples of two types of what?
Security instruments
Self-employed borrowers needs personal and corporate tax returns for a minimum of what time?
Two years
Who is responsible for providing the closing disclosure to the seller?
Settlement agent/title agent
How long is an appraisal valid for?
12 Months
How long do you lenders have to refund any excess of variations between the loan estimate in the closing disclosure?
60 days
This appraisal approach is often used in evaluating residential property. It also requires a minimum of three comparables and is usually called the market approach.
Sales comparison approach
When considering retirement or pension income, how long must take continue beyond the application date?
Three years
How long is an appraisal valid for?
12 months
This is signed by the borrower and creates a voluntary lien on the property for the security payment of debts, evidenced by the promissory note. The borrower is called the mortgagor and the lender is the mortgagee who retains the note in deed of trust.
Mortgage
How long must a loan estimate be kept for?
Three years
According to the truth in lending act, what is the definition of a business day?
Any day except Sunday and federal holidays.
Fannie Mae’s uniform residential loan application.
Form 1003
How long must the closing disclosure be kept for?
Five years
What is the business day definition when receiving the closing disclosure?
Any day except Sunday and federal holidays
This appraisal approach estimates the value of the real estate by analyzing the revenue, or income, the property currently generates or could generate. That was widely used with commercial investment properties.
Income approach
This document is signed by the borrower and evidences a promise to pay (the borrowers obligation to repay the debt to the lender).
promissory note
According to the real estate settlement procedures act, these two documents must be given out before settlement.
Affiliated business arrangement disclosure and closing disclosure
According to the real estate settlement procedures act, these two documents must be given out at settlement.
Finalize the closing disclosure and initial escrow statement
If a new revised loan estimate is required because of a change to circumstance, it must be disclosed and received by the borrower when?
Four days prior to consummation of the loan
Who is responsible for providing the closing disclosure to the borrower?
Creditor/lender
Rental income is calculated at what percent to allow for vacancy loss?
75%
What is the business day definition when receiving a revised loan estimate?
Any day except Sunday and federal holidays
Document designed to detail borrowers history, trends, and attitude to predict future loan repayment behavior.
Loan application
Another term for market approach.
Sales comparison approach
