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AZ Real Estate Agent License 2020 > FHA, VA, CONV, Loans and Prime/2nd Mkt 7 > Flashcards

FHA, VA, CONV, Loans and Prime/2nd Mkt 7 Flashcards

1
Q

Lender is Insured from Loss by this Housing Program.This Insurance Protection Allows Borrower to obtain Loans with Higher Loan to Value Ratio (LTV)and Smaller Down Payment as compared to Uninsured Conventional Loans

A

(FHA) Fed Housing Administration - Insured Loans

Lender is Insured from Loss. This Insurance Protection Allows Borrower to obtain Loan with Higher Loan to Value Ratio (LTV) and Smaller Down Payment as compared to Uninsured Conventional Loans

Chap 7

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2
Q

FHA is regulated by what Dept?

A

HUD -

Dept of Housing and Urban Development - Regulates FHA.

Chap 7

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3
Q

FHA Insured Loans Guidelines

  1. FHA Ap_____ Lenders make the Loans
  2. FHA Regulated by Dept of H_____ & Ur___ Development (HUD)
  3. Borrower Pays (MIP) Mor____ Ins_____ Pre_____. Mortgage Insurance protects the Lender if Property For_____
  4. Appraisal is called Cond_____ Com______
  5. Escape Clause (FHA Ame______ Clause) - Used if Appraisal is Not Equal or Above Purchase Price. Buyer can Back-Out.
  6. Owner Occupied - 1 to __ Units Only
  7. No Pre______ Pen_____
A

FHA Insured Loans Guidelines

  1. FHA Approved Lenders make the Loans
  2. FHA Regulated by Dept of Housing & Urban Development (HUD)
  3. Borrower Pays (MIP) Mortgage Insurance Premium. Mortgage Insurance protects the Lender if Property Forclosed
  4. Appraisal is - Conditional Commitment
  5. Escape Clause (FHA Amendatory Clause) - Used if Appraisal is not Equal or Above Purchase Price. Buyer can Back-Out.
  6. Owner Occupied - 1 to 4 Units Only
  7. No Prepayment Penalties
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4
Q

Cond______ C_________

FHA Appraisal

A

Conditional Commitment -

FHA Appraisal

Chap 7

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5
Q

VA Loan Requirements

  1. VA Ap______ Lenders makes Loans
  2. Cert______ of Elig_____ - Veteran Eligibility and Amount Guarantee (Entitlement)
  3. VA F______ Fee - So No MIP
  4. Appraisal is called - Cert_____ of Reas_____ V___ (CRV)
  5. No Down Payment - ____% LTV Unless Over Purchase Price
  6. Owner Occupied - 1 to __ Units
  7. No Pre_______ Penalties
A

VA Loan Requirements

  1. VA Approved Lenders makes Loans
  2. Certificate of Eligibility - Veteran Eligibility and Amount Guarantee (Entitlement)
  3. VA Funding Fee - So No MIP
  4. Appraisal - Certiticate of Reasonable Value (CRV)
  5. No Down Payment - 100% LTV Unless Over Purchase Price
  6. Owner Occupied - 1 to 4 Units
  7. No Prepayment Penalties

Chap 7

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6
Q

Es____ Clause (FHA Amen_____ Clause) -

  1. Used if FHA Appraisal Value is Not Equal to or Greater than Purchase Price.
  2. Buyers must See Appr_____ or Can Back Out of Contract.
A

Escape Clause (FHA Amendatory Clause) -

  1. Used if FHA Appraisal Value is not equal to or greater than purchase price.
  2. Buyers must See Appraisal or Can Back Out of Contract.

Chap 7

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7
Q

(CRV) Cer_____ of Rea______ Value -

VA Appraisal

A

(CRV) Certificate of Reasonable Value -

VA Appraisal

Chap 7

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8
Q

VA F_____ Fee -

Charged on VA loan instead of MIP

A

VA Funding Fee -

Charged on VA loan instead of MIP

Chap 7

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9
Q

FHA and VA Loans -

Both types of loans have No Pre______ Pen______

A

FHA and VA Loans -

Both types of loans have No Prepayment Penalties

Chap 7

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10
Q

Assist Lenders to Provide Loans** for **Low to Moderate Income Households in “Rural Areas”

A

(USDA) US Dept of Agriculture Loans (Guaranteed) - Rural Areas

Assist lenders to Provide Loans** for **Low to Moderate Income Households in “Rural Areas”

Chap 7

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11
Q

P

AZ Department of Housing provides these Loans in Hardest Hit Areas by Foreclosures

A

Pathway to Purchase - Down Payment Assistance - Foreclosure Areas

AZ Department of Housing provides these Loans in Hardest Hit Areas by Foreclosures

Chap 7

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12
Q

SBA Loans (S____ B_____ Adm_______) -

Loans made to Purchase or Expand a Small Business

A

SBA Loans (Small Business Administration) -

Loans made to Purchase or Expand a Small Business

Chap 7

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13
Q

Con_______ Loans -

Loan is made Solely Based on Security and Borrower’s Ability to Repay.

No Guarantees or Government Insurance

A

Conventional Loans -

Loan is made Solely Based on Security and Borrower’s Ability to Repay.

No Guarantees or Government Insurance

Chap 7

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14
Q

Conventional (Un______) Loans -

Loans that Require __% down. Based on Borrower’s Ability to Repay. No Government Insurance or Guarantee

A

Conventional (Unisured) Loans -

Loans that Require 20% down. Borrower’s Ability to Repay. No Government Insurance or Guarantee

Chap 7

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15
Q

Conf______ Loans

Loans that meet all Fannie Mae and Freddie Mac Guidelines.

A

Conforming Loans -

Loans that meet all Fannie Mae** and **Freddie Mac Guidelines

Chap 7

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16
Q

Loans that “Do Not” meet Fannie Mae or Freddie Mac Guidelines.

A

Non-Conforming Loans -

Loans that “Do Not” meet Fannie Mae or Freddie Mac guidelines.

Chap 7

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17
Q

Loans offered at a Higher Interest Rate for Less Qualified Borrowers

A

Subprime Loans - (Less Qualified)

Loans offered at a Higher Interest Rate for Less Qualified Borrowers

Chap 7

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18
Q

Pri_____ I_____ and H____ M____ L_____

Loans offered at Higher Interest for

“Hard to Finance” Borrowers and Properties

A

Private Investor and Hard Money Loans -

Loans offered at Higher Interest for

“Hard to Finance” Borrowers and Properties

Chap 7

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19
Q

Assist lenders to provide loans for Low to Moderate Income Households in Rural Areas

A

(USDA) US Dept of Agriculture Loans (Guaranteed) - Rural Areas

Assist lenders to provide loans for Low to Moderate Income Households in Rural Areas

Chap 7

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20
Q

Discount Point and Buydowns

Used to Increase L____’s Y___ or Lower Borrowers Rate

A

Discount Point and Buydowns

Used to Increase Lender’s Yield or Lower Borrowers Rate

Chap 7

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21
Q

Loan O_____ Fee -

Covers Initial Cost of Loan

A

Loan Origination fee -

Covers Initial Cost of Loan

Chap 7

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22
Q

T___ S___ F___

Charge to Hire a Tax Service Company to Infom Lender When Property Taxes are Due and Payable.

A

Tax Service Fee

Charge to Hire a Tax Service Company to Inform Lender When Property Taxes are Due and Payable.

Chap 7

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23
Q

Und_______ Fee -

Offset Cost to determine Borrower’s Ability Qualify or to Repay Loan

A

Underwriting fee -

Offset Cost to determine Borrower’s Ability Qualify or to Repay Loan

Chap 7

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24
Q

P______ ______ and D______ _____ ______

AZ Department of Housing provides these Loans in Hardest Hit Areas by Foreclosures

A

Pathway to Purchase - Down Payment Assistance - Foreclosure Areas

AZ Department of Housing provides these Loans in Hardest Hit Areas by Foreclosures

Chap 7

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25
Q

Estimate how much Borrower can Afford to Borrow

A

Pre-Qualification -

Estimate how much Borrower can Afford to Borrow

Chap 7

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26
Q

Pre-Approval -

Completed L___ App, Inc____ provided, and Borrower’sCr___ Report reviewedthat indicates aStrong Possibility Loan will Close.

A

Pre-Approval -

Completed Loan App, Income provided, and Borrower’sCredit Report reviewedthat indicates aStrong Possibility Loan will Close.

Chap 7

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27
Q

R__ L__

Lender Guarantees the Interest Rate will not Change Prior to Closing.

A

Rate Lock -

Lender Guarantees the Interest Rate will not Change Prior to Closing.

Chap 7

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28
Q

F____ R___

Interest Rate Could Change prior to Closing

A

Floating Rate

Interest Rate Could Change prior to Closing

Chap 7

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29
Q

Credit Score (Fico Score) -

Ma________ Formula to indicate Person’s Credit History

A

Credit Score (Fico Score) -

Mathematical Formula to indicate Person’s Credit History

Chap 7

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30
Q

-

  1. Financial Intermediary that Make “Large Loans” to Commercial and Industrial Borrowers.
  2. Residential Loans Done - thru Mortgage Companies
  3. Buys Loans in Secondary Market
A

Insurance Companies -

  1. Financial Intermediary that Make “Large Loans” to Commercial and Industrial Borrowers.
  2. Residential Loans Done - thru Mortgage Companies
  3. Buys Loans in Secondary Market

Chap 7

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31
Q

HOA Reserve Funding (FHA Loans Require) -

FHA Loans and other Loans Require HOA Reserves:

  1. __% Of HOA Budgeted Income,
  2. __% - If less than __% Occupancy
A

HOA Reserve Funding (FHA Loans Require) -

FHA Loans and other Loans Require HOA Reserves:

  1. 10% - Of HOA Budgeted Income,
  2. 20% - If less than 50% Occupancy

Chap 7

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32
Q

Assist lenders to provide loans for Low to Moderate Income Households in Rural Areas

A

(USDA) US Dept of Agriculture Loans - (Guaranteed) -

Assist lenders to provide loans for Low to Moderate Income Households in Rural Areas

Chap 7

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33
Q

Dis________ and Bu________

Used to Increase Lender’s Yield or Lower Borrowers Rate

A

Discount Point and Buydowns

Used to Increase Lender’s Yield or Lower Borrowers Rate

Chap 7

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34
Q

P______ to P________ - D______ P____ A_______

AZ Department of Housing provides these Loans in Hardest Hit Areas by Foreclosures

A

Pathway to Purchase - Down Payment Assistance - Foreclosure Areas

AZ Department of Housing provides these Loans in Hardest Hit Areas by Foreclosures

Chap 7

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35
Q

(DCR) D___ Cov______ Rat___ -

Net Incomedivided by (Annual) PI Payments

= Ratio of Net Income from “Commercial Properties.”

Lenders Require Above 1

  • Net Income
  • _(_Annual) PI Payments
A

(DCR) Debt Coverage Ratio -

Net Incomedivided by (Annual) PI Payments= Ratio of Net Income from “Commercial Properties.”

Lenders Require Above 1

  • Net Income
  • _(_Annual) PI Payments

Chap 7

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36
Q

C_______ Cre____ Tran_______

(Financial Institutes/Merchants -Person/Company) -

Acquires Property for P______, Fam___ or Household purposes (Loan, Lease or Sale under $25,000)

Owner Occ and 1-4 Units Only

A

Consumer Credit Transaction

(Financial Institutes/Merchants -Person/Company) -

Acquires Property for Personal, Family or Household purposes. (Loan, Lease or Sale under $25,000)

Owner Occ and 1-4 Units Only

Chap 7

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37
Q

Non-Consumer Credit Transaction

(Finance Institutes/Merchant - Person or Company) -

Acquires Property for Bus_____ Purposes. Profit Motives For Inv_____ Purposes, Property Taxes

A

Non-Consumer Credit Transaction

(Finance Institutes/Merchant - Person or Company) -

Acquires Property for Business Purposes. Profit Motives For Investment Purposes, Property Taxes

Chap 7

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38
Q

W_____ R_____ from the L_____ -

Seller must request, when Seller Does Not want to remain Liable for Loan and wants Buyer to take over loan.

A

Written Release from the Lender -

Seller must request, when Seller Does Not want to remain Liable for Loan and wants Buyer to take over Loan

Chap 7

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39
Q

N_______ -

Process of Lender Rewriting Loan Terms of Existing Loan, Subs New Buyer and Releases Seller’s Liability.

A

Novation -

Process of Lender Rewriting Loan Terms of Existing Loan, Subs New Buyer and Releases Seller’s Liability.

Chap 7

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40
Q

Red____ Cert_____ (Assu_____ Letter) - For Assumed Loans

  1. Lender Gives to Buyer Assuming Loan.
  2. Verifies Loan Balance and Terms when Buyer takes over Payments
A

Reduction Certificate (Assumption Letter) - For Assumed Loans

  1. Lender Gives to Buyer Assuming Loan.
  2. Verifies Loan Balance and Terms when Buyer takes over Payments

Chap 7

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41
Q

Financial Intermediaries (Primary Mortage Market Lenders) -

Originate Loans directly to Borrower:

  1. Comm____ Banks and C____ Unions,
  2. Ins_____ Companies,
  3. Port_____ Lenders,
  4. Mort_____ Brokers and Mortgage Bankers
A

Financial Intermediaries (Primary Mortage Market Lenders) -

Originate Loans directly to Borrower:

  1. Commercial Banks and Credit Unions,
  2. Insurance Companies,
  3. Portfolio Lenders,
  4. Mortgage Brokers and Mortgage Bankers

Chap 7

42
Q
  1. 3 Financial Intermediaries (Prime Market) that Originate Loans
  2. Buy Loans - in Secondary Market
A

Commercial Banks and Credit Unions and Insurance Companies

  1. 3 Financial Intermediaries (Prime Market) that Originate Loans
  2. Buy Loans in Secondary Market

Chap 7

43
Q

-

  1. Financial Intermediary that Make “Large Loans” to Commercial and Industrial Borrowers.
  2. Residential Loans Done - thru Mortgage Companies
  3. Buy Loans in Secondary Market
A

Insurance Companies -

  1. Financial Intermediary that Make “Large Loans” to Commercial and Industrial Borrowers.
  2. Residential Loans Done - thru Mortgage Companies
  3. Buys Loans in Secondary Market

Chap 7

44
Q

Por___ Lenders -

A Primary Market Lender (Financial Intermediary). Does Not Sell Loans. Non-Conforming or Jumbo Loans

A

Portfolio Lenders -

A Primary Market Lender (Financial Intermediary). Does Not Sell Loans. Non-Conforming or Jumbo Loans

Chap 7

45
Q

M B________ AND _________

  1. Primary Lender (Financial Intermediary)
    1. May Represent - Life Insurance Co., Pension Funds, and Private Investors in Originating Loans.
  2. Sells Loans to Secondary Market
A

Mortgage Brokers and Bankers

  1. Primary Lender (Financial Intermediary)
  2. May Represent - Life Insurance co., Pension Funds, and Private Investors in Originating Loans.
  3. Sells Loans to Secondary Market

Chap 7

46
Q

AZ Dept of Fin______ Inst______

“Licenses” Mortgage Loan Originators (ML0)

A

AZ Dept of Financial Institutions

“Licenses” Mortgage Loan Originators (ML0)

Chap 7

47
Q

(MLO) Mortgage Loan Originators

  1. Licensed By: Ariz Dept of Fin______ Inst_____
  2. Regulated By: Nat_____ Mortgage Lic_____ System (NMLS)
A

(MLO) Mortgage Loan Originators

  1. Licensed by Ariz Dept of Financial Institution
  2. Regulated by the Nationwide Mortgage Licensing System (NMLS)

Chap 7

48
Q

Gathering of Loans to Sell in Secondary Market

A

Warehousing -

Gathering of Loans to Sell in Secondary Market

Chap 7

49
Q

Assig_____ -

The “Process” of Selling a Loan to Another Lender

A

Assignment -

The “Process” of Selling a Loan to Another Lender

Chap 7

50
Q
  1. Certificate Signed by Borrower stating
    1. Exact Loan Balance and Interest Rate.
  2. Tenant to Verify Lease Terms.
  3. Used by Lenders Selling Loans.
A

Estoppel Certificate -

  1. Certificate Signed by Borrower Stating
    1. Exact Loan Balance and Interest Rate.
  2. Tenant to Verify Lease Terms.
  3. Used by Lenders Selling Loans.

Chap 7

51
Q

Used to Increase Lender’s Yield or Lower Borrowers Rate

A

Discount Point or Buydowns

Used to Increase Lender’s Yield or Lower Borrowers Rate

Chap 7

52
Q

Borrower Makes Payments to this Service Provider, which are Passed to Loan Investor. Seller Carrybacks often use Title Companies

Chap 7

A

Loan Servicing -

Borrower Makes Payments to this Service Provider, which are Passed to Loan Investor. Seller Carrybacks often use Title Companies

Chap 7

53
Q

I_________ _______ -

  1. Financial Intermediary that Make “Large Loans” to Commercial and Industrial Borrowers.
  2. Residential Loans Done - thru Mortgage Companies
  3. Buys Loans in Secondary Market
A

Insurance Companies -

  1. Financial Intermediary that Make “Large Loans” to Commercial and Industrial Borrowers.
  2. Residential Loans Done - thru Mortgage Companies
  3. Buys Loans in Secondary Market

Chap 7

54
Q

Redu____ Cert_____ (Assu_____ Letter)-

  1. Lender Gives to Buyer who is Assuming Loan.
  2. Verifies Loan Balance and Terms when Buyer Takes Over Payments
A

Reduction Certificate (Assumption Letter)-

  1. Lender Gives to Buyer who is Assuming Loan.
  2. Verifies Loan Balance and Terms when Buyer Takes Over Payments

Chap 7

55
Q
  1. Issues Certicates that Guarantee FHA and VA Loans to Secondary Market Purchasers.
  2. Operates Special Assistance aspects of Federally Assisted Low Income Housing.
A

Ginnie Mae aka Gov Nat’l Mortgage Assoc.(GNMA) -

  1. Issues Certificates that Guarantee FHA and VA Loans to Secondary Market Purchasers.
  2. Operates Special Assistance aspects of Federally Assisted Low Income Housing.

Chap 7

56
Q

Fannie Mae (Fed. Nat’l Mortgage Assoc) and Freddie Mac (Fed. Home Loan Mort. Corp)

  1. Sets Standards for Conv_____ Loans.
  2. Buys Conv_____ Loans in Sec_____ Market.
  3. Sells Loans and Issues Bo___ - Secured by Mortgages (Mortgage Backed Securities).
  4. Created “Uniform Res Loan App (URLA-Form ____).
A

Fannie Mae (Fed. Nat’l Mortgage Assoc) and Freddie Mac (Fed. Home Loan Mort. Corp)

  1. Sets Standards for Conventional Loans.
  2. Buys Conventional Loans in Secondary Market.
  3. Sells Loans and Issues Bonds - Secured by Mortgages (Mortgage Backed Securities).
  4. Created “Uniform Res Loan App (URLA-Form 1003)

Chap 7

57
Q
  1. Certificate Signed by Borrower stating:
    1. Exact Loan Balanace and Interest Rate.
  2. Tenant to Verify Lease Terms.
  3. Used by Lenders Selling Loans.
A

Estoppel Certificate -

  1. Certificate Signed by Borrower Stating:
    1. Exact Loan Balance and Interest Rate.
  2. Tenant to Verify Lease Terms.
  3. Used by Lenders Selling Loans.

Chap 7

58
Q

AZ Department of Housing provides these Loans in Hardest Hit Areas by Foreclosures

A

Pathway to Purchase - Down Payment Assistance - Foreclosure Areas

AZ Department of Housing provides these Loans in Hardest Hit Areas by Foreclosures

Chap 7

59
Q

Financial Intermediaries “Buy Loans” from Secondary Market

  1. Ins______ Companies - (Buy Loans)
  2. Com_____ Banks and Credit Unions - (Buy Loans)
  3. Fa____ M__ - (Buy Conventional Loans)
A

Financial Intermediaries “Buy Loans” from Secondary Market

  1. Insurance Companies (Buy Loans)
  2. Commercial Banks and Credit Unions (Buy Loans)
  3. Fannie Mae (Buy Conventional Loans)

Chap 7

60
Q

Financial Intermediaries who “Sell Loans” to Secondary Market

  1. Mortgage Br____ and Ba______,
  2. Fannie Mae Sells Loans and Issues Secured Bonds (Mortgage Backed Securities)
  3. GNMA - Issues Cert Guarantees for VA/FHA loans to 2nd Market P_________.

Chap 7

A

Financial Intermediaries who “Sell Loans” to Secondary Market

  1. Mortgage Brokers and Bankers,
  2. Fannie Mae Sells Loans and Issues Secured Bonds (Mortgage Backed Securities)
  3. GNMA - Issues Cert Guarantees for VA/FHA loans to 2nd Market Purchasers

Chap 7

61
Q

Ins____ Conv______ Loans -

Loans that have PMI, and are above 80% but no more that 97% of Appraised Value.

A

Insured Conventional Loans -

Loans that have PMI, and are above 80% but no more that 97% of Appraised Value.

Chap 7

62
Q

Market where Primary Market Loans are Bought and Sold to Other Lenders and Investors.

A

Secondary Market -

Market where Primary Market Loans are Bought and Sold to Other Lenders and Investors.

Chap 7

63
Q

Mortgage Brokers and Bankers

  1. Primary Lender (Financial termediary)
  2. May Represent L__ Insurance Co., P_____ Funds, and Pr_____ Investors in “Originating Loans.”
  3. Sells Loans to Secondary Market
A

Mortgage Brokers and Bankers (Sell)

  1. Primary Lender (Financial termediary)
  2. May Represent Life Insurance Co., Pension Funds, and Private Investors in Originating Loans.
  3. Sells Loans to Secondary Market

Chap 7

64
Q

(MGIC) Mor____ Guarantee Ins_____ Corporation -

A Private Company where Mortgage Insurance Providers Assume a Portion of a Lender’s or Investor’s Risk in Making a Mortgage Loan, ultimately Shielding Taxpayers from Liability

A

(MGIC) Mortgage Guarantee Insurance Corporation -

A Private Company where Mortgage Insurance Providers Assume a Portion of a Lender’s or Investor’s Risk in Making a Mortgage Loan, ultimately Shielding Taxpayers from Liability

Chap 7

65
Q

Borrowers must pay Upfront Insurance at Closing and will also Have their Annual Premium Added to their Monthly Mortgage Payments.

Also Protects Lender in Event of Foreclosure

A

(MIP) Mortgage Insurance Premium -

Borrowers must pay Upfront Insurance at Closing and will also Have their Annual Premium Added to their Monthly Mortgage Payments.

Also Protects Lender in Event of Foreclosure

Chap 7

66
Q

Lender is Insured from Loss. This Insurance Protection Allows Borrower to obtain Loan with Higher Loan to Value Ratio (LTV)and Smaller Down Payment as compared to Unisured Conventional Loans

A

(FHA) Fed Housing Administration - Insured Loans

Lender is Insured from Loss. This Insurance Protection Allows Borrower to obtain Loan with Higher Loan to Value Ratio (LTV)and Smaller Down Payment as compared to Unisured Conventional Loans

Chap 7

67
Q

Mo____ Market -

Determines the Discount Points

A

Money Market -

Determines the Discount Points

Chap 7

68
Q
  1. Certificate Signed by Borrower Stating
    1. Exact Loan Balance and Interest Rate.
  2. Tenant to Verify Lease Terms.
  3. Used by Lenders Selling Loans.
A

Estoppel Certificate -

  1. Certificate Signed by Borrower Stating
    1. Exact Loan Balance and Interest Rate.
  2. Tenant to Verify Lease Terms.
  3. Used by Lenders Selling Loans.

Chap 7

69
Q

(GNMA) Ginnie Mae aka Gov Nat’l Mortgage Assoc -

  1. Issues Certs that Guar______ FHA and VA Loans to Secondary Market Purchasers.
  2. Operates Special Assistance Aspects of Federally Assisted “L__ Inc____” Housing.
A

(GNMA) Ginnie Mae aka Gov Nat’l Mortgage Assoc -

  1. Issues Certs that Guaranteeing FHA and VA Loans to Secondary Market Purchasers.
  2. Operates Special Assistance Aspects of Federally Assisted Low Income Housing.

Chap 7

70
Q

AZ Department of Housing provides these Loans in Hardest Hit Areas by Foreclosures

A

Pathway to Purchase - Down Payment Assistance - Foreclosure Area

AZ Department of Housing provides these Loans in Hardest Hit Areas by Foreclosures

Chap 7

71
Q
  1. Primary Lender (Financial Intermediary)
  2. May Represent Life Insurance Co., Pension Funds, and Private Investors in “Originating Loans.”
  3. Sells Loans to Secondary Market
A

Mortgage Brokers and Bankers (Sell)

  1. Primary Lender (Financial Intermediary)
  2. May Represent Life Insurance Co., Pension Funds, and Private Investors in “Originating Loans.”
  3. Sells Loans to Secondary Market

Chap 7

72
Q

Mor____ (Receives Loan)

In a Loan, the Lender is the Person who Receives Loan

A

Mortgagee (Receives Loan)

In a Loan the Lender is known as Mortgagee.

Chap 7

73
Q

________ and ________

  1. Sets Standards for Conventional Loans.
  2. Main Purpose is to Buy Conventional Loans in Secondary Market.
A

Fannie Mae/Freddie Mac

  1. Sets Standards for Conventional Loans.
  2. Main Purpose is to Buy Conventional Loans in Secondary Market.

Chap 7

74
Q

FHA and L_____ -

Gives Approval, when Seller has Buyer, who wants to Assume FHA Loan

A

FHA and Lender -

Gives Approval, when Seller has Buyer, who wants to Assume FHA Loan

Chap 7

75
Q

Certificate issued by the VA to Veterans Stating the Eligibility and Amount of Guarantee (Entitlement).

Note: When Paid Off - Eligibity is Restored.

A

Certificate of Eligibility -

Certificate issued by the VA to Veterans Stating the Eligibility and Amount of Guarantee (Entitlement).

Note: When Paid Off - Eligibity is Restored.

Chap 7

76
Q

Ginnie Mae aka Gov N____ Mor____ Asso____ (GNMA)

  1. Issues Certificates that Guarantee FHA and VA Loans to Secondary Market Purchasers.
  2. Operates Special Assistance aspects of Federally Assisted Low Income Housing.
A

Ginnie Mae aka Gov Nat’l Mortgage Assoc (GNMA) -

  1. Issues Certificates that Guarantee FHA and VA Loans to Secondary Market Purchasers.
  2. Operates Special Assistance aspects of Federally Assisted Low Income Housing.

Chap 7

77
Q

Required on Conventional Loans above 80%-97% LTV.

A

Mortgage Insurance (MI) or Private Mortgage Insurance (PMI)

Required on Conventional Loans above 80%-97% LTV.

Chap 7

78
Q

J____ Loans -

Non-Conforming loans that Exceed Max Dollar Limits set by Fannie Mae or Freddie Mac and have Less Favorable Terms.

A

Jumbo Loans -

Non-conforming loans that Exceed Max Dollar Limits set by Fannie Mae or Freddie Mac and have Less Favorable Terms.

Chap 7

79
Q

R___ Lock -

Lender Guarantees interest Rate will Not Change prior to closing

A

Rate Lock -

Lender guarantees interest rate will not change prior to closing.

Chap 7

80
Q

Floating Rate -

When Rate Could Change Prior to Closing.

A

Floating Rate -

When Rate Could Change Prior to Closing.

Chap 7

81
Q
  1. Primary Lender (Financial Intermediaries)
  2. May Represent Life Insurance Co., Pension Funds, and Private Investors in “Originating Loans.”
  3. Sells Loans to Secondary Market
A

Mortgage Brokers and Bankers

  1. Primary Lender (Financial Intermediary)
  2. May Represent Life Insurance Co., Pension Funds, and Private Investors in “Originating Loans.”
  3. Sells Loans to Secondary Market

Chap 7

82
Q

Tri-_____ Credit Report -

Single Credit Report that brings together Data from all 3 Major Credit Reporting Agencies.

A

Tri-Merged Credit Report -

Single Credit Report that brings together Data from all 3 Major Credit Reporting Agencies.

Chap 7

83
Q

Loan As_______ -

Buyer does not Originate Loan but Takes Over Payments and Assumes Personal Liability on Existing Loan.

A

Loan Assumption -

Buyer does not Originate Loan but Takes Over Payments and Assumes Personal Liability on Existing Loan.

Chap 7

84
Q
  1. Issues Certificates that Guarantees FHA and VA loans to Secondary Market Purchasers.
  2. Operates Special Assistance aspects of Federally Assisted “Low Income” Housing.
A

Ginnie Mae aka Gov Nat’l Mortgage Assoc (GNMA) -

  1. Issues Certificates that Guaranteeing FHA and VA loans to Secondary Market Purchasers.
  2. Operates Special Assistance aspects of Federally Assisted Low Income Housing.

Chap 7

85
Q

L____ to V___ R____ -

Often used Ratio in Mortgage Lending to Determine the Amount Necessary to Put in a Down-Payment and Whether a Lender will Extend Credit to a Borrower.

Loan Amt / Appraised Value = LTV

A

Loan to Value Ratio -

Often used Ratio in Mortgage Lending to Determine the Amount Necessary to Put in a Down-Payment and Whether a Lender will Extend Credit to a Borrower.

Loan Amt / Appraised Value = LTV

Chap 7

86
Q

P______ M____ M_____ -

Originate Loans Directly with Borrowers. These Lenders are also called “Financial Intermediaries”.

A

Primary Mortgage Market -

Originate Loans Directly with Borrowers. These Lenders are also called “Financial Intermediaries”.

Chap 7

87
Q
  1. Primary Lender (Financial Intermediary)
  2. May Represent Life Insurance Co., Pension Funds, and Private Investors in “Originating Loans.”
  3. Sells Loans to Secondary Market
A

Mortgage Brokers and Bankers

  1. Primary Lender (Financial Intermediary)
  2. May Represent Life Insurance Co., Pension Funds, and Private Investors in “Originating Loans.”
  3. Sells Loans to Secondary Market

Chap 7

88
Q

FHLMC - Federal H____ L___ M____ Corp -

Another Term for Freddie Mac

A

FHLMC - Federal Home Loan Mortgage Corp -

Another Term for Freddie Mac

Chap 7

89
Q
  1. Primary Lender (Financial Intermediary)
  2. May Represent Life Insurance Co., Pension Funds, and Private Investors in “Originating Loans.”
  3. Sells Loans to Secondary Market
A

Mortgage Brokers and Bankers

  1. Primary Lender (Financial Intermediary)
  2. May Represent Life Insurance Co., Pension Funds, and Private Investors in “Originating Loans.”
  3. Sells Loans to Secondary Market

Chap 7

90
Q

URLA - Uniform R______ L____ Application -

Created by Fannie Mae for Residential Loans

A

URLA - Uniform Residential Loan Application -

Created by Fannie Mae for Residential Loans

Chap 7

91
Q

Interest Problems Formula

A

Interest Problems Formula -

  • Interest
  • Principal x Rate

Chap 7

92
Q

Gathering of Loans to Sell in Secondary Market

A

Warehousing -

Gathering of Loans to Sell in Secondary Market

Chap 7

93
Q

Loan Problems Formula

A

Loans Problem Formula -

  • Loan Amount
  • Value x Rate

Chap 7

94
Q

3 Financial Intermediaries that“Originate Loans” in Prime Market and “Buy Loans” in Secondary Market

A

3 Financial Intermediaries that“Originate Loans” in Prime Market and “Buy Loans” in Secondary Market

  1. Commercial Banks & Credit Unions
  2. Insurance Companies (Originate Commerical & Industrial Loans)

Chap 7

95
Q

E________ ______ -

  1. Certificate Signed by Borrower Stating
    1. Exact Loan Balance and Interest Rate.
  2. Tenant to Verify Lease Terms.
  3. Used by Lenders Selling Loans.
A

Estoppel Certificate -

  1. Certificate Signed by Borrower Stating
    1. Exact Loan Balance and Interest Rate.
  2. Tenant to Verify Lease Terms.
  3. Used by Lenders Selling Loans.

Chap 7

96
Q
  1. Financial Intermediary that Make “Large Loans” to Commercial and Industrial Borrowers.
  2. Residential Loans Done - thru Mortgage Companies
  3. Buys Loans in Secondary Market
A

Insurance Companies - (Buy)

  1. Financial Intermediary that Make “Large Loans” to Commercial and Industrial Borrowers.
  2. Residential Loans Done - thru Mortgage Companies
  3. Buys Loans in Secondary Market

Chap 7

97
Q

Funds For Conventional Loans are secured from:

  1. FHA
  2. Fannie Mae
  3. Freddie Mac
  4. Private Sources
A

Funds For Conventional Loans are secured from:

  1. FHA
  2. Fannie Mae
  3. Freddie Mac
  4. Private Sources

Chap 7

98
Q

Funds for FHA loans are secured from:

  1. Fannie Mae
  2. Approved Local Lenders
  3. FDIC
  4. FHA
A

Funds for FHA loans are secured from:

  1. Fannie Mae
  2. Approved Local Lenders
  3. FDIC
  4. FHA

Chap 7

99
Q

Which of the following loans has the Highest Loan to Value?

  1. Conventional
  2. Conventional with PMI
  3. FHA
  4. VA
A

Which of the following loans has the Highest Loan to Value?

  1. Conventional
  2. Conventional with PMI
  3. FHA
  4. VA

Chap 7

100
Q

The Government Agency that Supervises and Administers Subsidy Programs for Low-Income Housing is:

  1. FHA
  2. Fannie Mae
  3. GNMA
  4. Freddie Mac
A

The Government Agency that Supervises and Administers Subsidy Programs for Low-Income Housing is:

  1. FHA
  2. Fannie Mae
  3. GNMA
  4. Freddie Mac

Chap 7

101
Q

Freddie Mac and Fannie Mae DO NOT:

  1. Sell Loans
  2. Sell Bonds Secured by Mortgages
  3. Buy Conventional Loans
  4. Originate FHA and VA Loans
A

Freddie Mac and Fannie Mae DO NOT:

  1. Sell Loans
  2. Sell Bonds Secured by Mortgages
  3. Buy Conventional Loans
  4. Originate FHA and VA Loans

Freddie Mac and Fannie Mae DOES:

  1. Set Conventional Loan Standards
  2. Buy Coventional Loans from Secondary Market
  3. Sell Bonds by Secured by Mortgages

Chap 7

AZ Real Estate Agent License 2020 (23 decks)

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