Finance 1 - Nature & Cycle of RE Finance

Question 1

The first government’s program dedicated to restoring the American economy; also called the Stimulus Act.

Answer 1

American Recovery & Reinvestment Act of 2009 (ARRA)

Question 2

The act retained some aspects of Taxpayer Relief Act of 1997, while eliminating others.

Answer 2

American Taxpayer Relief Act of 2012 (ATRA)

Question 3

Persons born between 1946 and 1964.

Answer 3

baby boomers

Question 4

Something having value that is given to secure repayment of a dept.

Answer 4

collateral

Question 5

Established in 2010 under the Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) as an independent agency setting rules and regulations for any business providing financial services to consumers.

Answer 5

Consumer Financial Protection Bureau (CFPB)

Question 6

A situation where more funds are being withdrawn from financial institutions than are being deposited.

Answer 6

disintermediation

Question 7

Referred to as Generation Y or the Millennial General, the group of people following Generation X. Beginning birth dates range from the late 1970’s/early 1980’s to the early 2000.

Answer 7

echo boomers

Question 8

Property ownership rights held by the purchaser in conjunction with transferring legal title to the lender by a security deed. Owner retains a right of redemption to reacquire the legal title from the lender when the loan is paid off.

Answer 8

equitable title

Question 9

Generally considered to be those born between 1965 and 1976; tend to marry later and have a higher divorce rate and lower remarriage rate, resulting in a higher percentage of persons living alone.

Answer 9

Generation X

Question 10

This program has given homeowners an opportunity to modify or refinance their mortgage in order to make the monthly payments affordable and avoid foreclosure.

Answer 10

Home Affordable Modification Program (HAMP)

Question 11

A program of refinancing specifically designed for homeowners not eligible for

Answer 11

Home Affordable Refinance Program (HARP)

Question 12

To pledge property as security for an obligation or loan without giving up possession of it.

Answer 12

hypothecation

Question 13

The use of borrowed money to finance an investment.

Answer 13

leverage

Question 14

Also known as Generation Y, this group of individuals born between 1980 and the mid-2000s is the largest generation in the United States.

Answer 14

millinnials

Question 15

Packages of mortgage loans sold on the open market; some pools may be of the same type loans, while others may be multiple-issue pools.

Answer 15

mortgage-backed securities (MBSs)

Question 16

Relieves borrower from liability to pay taxes on any monies forgiven by a bank due to a short sale or foreclosure.

Answer 16

Mortgage Forgiveness Debt Relief Act of 2007

Question 17

The mortgage market in which loans are originated, consisting of lenders such as commercial banks, savings associates, credit union, mortgage brokers, and mortgage bankers.

Answer 17

primary market

Question 18

Historically, real estate goes around in short-term (three to five years) and long-term (10 to 15 years) cycles. The ability to forecast future cycles is significant to investors.

Answer 18

real estate cycle

Question 19

When a bank official signs off on numerous foreclosure papers without adequate research; blames for some of the current foreclosure problems.

Answer 19

robo-signing

Question 20

A marketplace in which mortgages and trust deeds are traded. See also Fannie Mae, Freddie Mac, and Ginnie Mae.

Answer 20

secondary market

Question 21

A sweeping revision of the income tax code providing homeowners with exemptions from capital gains ta on the sale of personal residences.

Answer 21

Taxpayer Relief Act of 1997 (TRA ‘97)

Question 22

Signed into law in July 2010; includes provisions anticipated to restore responsibility and accountability to the financial system, including establishing the Consumer Financial Protection Bureau.

Answer 22

Wall Street Reform and Consumer Protection Act (Dodd-Frank Act)