Financing Flashcards
What did the TILA enact to?
Disclose credit terms in a meaningful way
Which party is responsible to disclose what under TILA?
Creditor furnishes disclosures
An installment note is nearest to?
Principal and interest, specific amounts at intervals
A fully amortized loan does?
Debt is liquidated
A long term loan does what?
Payment to principal increases and interest decreases
A loan where the interest rate can increase or decrease is called?
ARM
A straight note does what?
No principal payments during term, an interest only loan
A partially amortized loan is considered as a?
Balloon payment
A balloon payment requires you to?
Pay the entire balance due
What do you call when the vendor executes contract?
Vendor conveys equitable title to the vendee
What does equitable title in a land contract mean?
Give right to use and possess, obtain legal title
The relationship between vendor and vendee is?
Beneficiary and trustor
In a land contract, what happens when a vendee defaults?
Vendor can quite title suit or quit claim deed
What types of payments on a FHA?
Monthly payments
FHA loans were created to provide?
Insurance for approved lenders
FHA loan, the borrower directly applies for?
A mortgage
What is not permitted as a FHA loan?
Junior loan
What is permitted for a FHA loan?
Gift down payment
What is an insured loan?
FHA and PMI
In a VA loan, what is the down payment?
No down payment
Which CA loan helps first time low income buyers?
CalHFA loan
CAlHFA loans are funded by?
Tax exempt government bonds
Inflation most nearly means?
Cost of goods and services increasing over time
What is not considered a secondary mortgage market?
FHA
Differences between mortgage bankers vs brokers?
Mortgage bankers service loans, sell on secondary market. Mortgage brokers do not loan their own money
What size of loans do insurance companies loan?
Large loans
CAL VET loans are set up as?
Land contract (real property purchase contract)
Who is the vendor for the CAL VET loan?
Department of veterans affairs
What protection does the department of veterans affairs have in a cal vet loan?
Protected by life/disability insurance
Which type of loans does Regulation Z don’t exempt for?
Residential loans
Right to rescind for loan on?
Existing principle dwelling
When can a rate be placed in an ad?
Must be effective rate
Two most critical facts to be disclosed in a loan?
Finance charge and annual percentage rate
Effective interest rate vs nominal interest rate?
Effective rate is rate actually paid, nominal rate in note
What are triggering terms in an ad?
Disclose APR and all terms, no down payment, how many months
If loan ad contains only APR?
No additional disclosures
RESPA was established for what purpose?
Accurate closing cost information
RESPA applies to what type of properties
1 - 4 owner occupied residential properties
Loan estimate must be provided by within
3 business days after application
How much can the lender charge for closing disclosure?
Nothing
What do points used in financial services do?
Adjust investor yields
Can an agent get paid on referral fees for loans? “Kickback”
No
What is the definition of liens
A charge imposed by a creditor
Liens that are created by recording are
Trust deed or mortgage
What’s an example of a lien?
Attachment
What type of lien is it when a seller carries back a second lien
Specific lien
What type is a judgment lien
Involuntary general
What type is a property tax lien
Involuntary specific (tied to one piece of property)
What type is an IRS lien
Involuntary general
What type of lien is a trust deed
Voluntary specific
A judgment lien differs from a mechanic lien by
Mechanic lien has Priority earlier than recording
When do mechanic liens take place for a new house?
Beginning of construction
Even when all the work is done themselves, when can a mechanic lien still take in effect
Failure to pay for materials
After the completion of work is recorded, how long do you have till you can file a mechanic lien
60 days to file
After the completion of work is NOT recorded, how long do you have till you can file a mechanic lien
90 days to file
What is NOT considered a negotiable instrument
Mortgage
In a trust deed, what evidence describes a promissory note
Evidence of debt
In a trust deed, who is the trustor
The borrower
In a trust deed, what does the trustor sign
Note and trust deed
In a trust deed, what does the beneficiary do
Loans money
In a trust deed, who gives the power to sell
Trustor to trustee (3rd party)
In a trust deed, what does the trustee give to the beneficiary
Fiduciary to beneficiary
In a trust deed, what are the services of trustee
Trustee’s sale and reconveyance deed
What is a reconveyance deed
Request for full reconveyance, has 21 calendar days from request to cooperate
After a Notice of default is recorded, how long until sale of property?
4 months to sale
After date of sale is published, how long until sale of property?
21 days to sale
How long do you have for reinstatement from foreclosure
5 days before sale
At sale, winner gets
Trustee’s deed
Explain the subordination clause
Rights of beneficiary are secondary
When are construction loan funds released?
Released after lien period
Who is involved in a mortgage contract
Mortgagor and mortgagee
Explain court (judicial) foreclosure
Deficiency judgment, 1 year right of redemption
In a court (judicial) foreclosure, what is considered for the trustee’s sale
Trustee’s sale is final, no recourse
