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Real Estate Exam > Financing > Flashcards

Financing Flashcards

1
Q

What did the TILA enact to?

A

Disclose credit terms in a meaningful way

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2
Q

Which party is responsible to disclose what under TILA?

A

Creditor furnishes disclosures

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3
Q

An installment note is nearest to?

A

Principal and interest, specific amounts at intervals

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4
Q

A fully amortized loan does?

A

Debt is liquidated

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5
Q

A long term loan does what?

A

Payment to principal increases and interest decreases

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6
Q

A loan where the interest rate can increase or decrease is called?

A

ARM

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7
Q

A straight note does what?

A

No principal payments during term, an interest only loan

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8
Q

A partially amortized loan is considered as a?

A

Balloon payment

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9
Q

A balloon payment requires you to?

A

Pay the entire balance due

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10
Q

What do you call when the vendor executes contract?

A

Vendor conveys equitable title to the vendee

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11
Q

What does equitable title in a land contract mean?

A

Give right to use and possess, obtain legal title

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12
Q

The relationship between vendor and vendee is?

A

Beneficiary and trustor

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13
Q

In a land contract, what happens when a vendee defaults?

A

Vendor can quite title suit or quit claim deed

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14
Q

What types of payments on a FHA?

A

Monthly payments

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15
Q

FHA loans were created to provide?

A

Insurance for approved lenders

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16
Q

FHA loan, the borrower directly applies for?

A

A mortgage

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17
Q

What is not permitted as a FHA loan?

A

Junior loan

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18
Q

What is permitted for a FHA loan?

A

Gift down payment

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19
Q

What is an insured loan?

A

FHA and PMI

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20
Q

In a VA loan, what is the down payment?

A

No down payment

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21
Q

Which CA loan helps first time low income buyers?

A

CalHFA loan

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22
Q

CAlHFA loans are funded by?

A

Tax exempt government bonds

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23
Q

Inflation most nearly means?

A

Cost of goods and services increasing over time

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24
Q

What is not considered a secondary mortgage market?

A

FHA

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25
Q

Differences between mortgage bankers vs brokers?

A

Mortgage bankers service loans, sell on secondary market. Mortgage brokers do not loan their own money

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26
Q

What size of loans do insurance companies loan?

A

Large loans

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27
Q

CAL VET loans are set up as?

A

Land contract (real property purchase contract)

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28
Q

Who is the vendor for the CAL VET loan?

A

Department of veterans affairs

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29
Q

What protection does the department of veterans affairs have in a cal vet loan?

A

Protected by life/disability insurance

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30
Q

Which type of loans does Regulation Z don’t exempt for?

A

Residential loans

31
Q

Right to rescind for loan on?

A

Existing principle dwelling

32
Q

When can a rate be placed in an ad?

A

Must be effective rate

33
Q

Two most critical facts to be disclosed in a loan?

A

Finance charge and annual percentage rate

34
Q

Effective interest rate vs nominal interest rate?

A

Effective rate is rate actually paid, nominal rate in note

35
Q

What are triggering terms in an ad?

A

Disclose APR and all terms, no down payment, how many months

36
Q

If loan ad contains only APR?

A

No additional disclosures

37
Q

RESPA was established for what purpose?

A

Accurate closing cost information

38
Q

RESPA applies to what type of properties

A

1 - 4 owner occupied residential properties

39
Q

Loan estimate must be provided by within

A

3 business days after application

40
Q

How much can the lender charge for closing disclosure?

A

Nothing

41
Q

What do points used in financial services do?

A

Adjust investor yields

42
Q

Can an agent get paid on referral fees for loans? “Kickback”

A

No

43
Q

What is the definition of liens

A

A charge imposed by a creditor

44
Q

Liens that are created by recording are

A

Trust deed or mortgage

45
Q

What’s an example of a lien?

A

Attachment

46
Q

What type of lien is it when a seller carries back a second lien

A

Specific lien

47
Q

What type is a judgment lien

A

Involuntary general

48
Q

What type is a property tax lien

A

Involuntary specific (tied to one piece of property)

49
Q

What type is an IRS lien

A

Involuntary general

50
Q

What type of lien is a trust deed

A

Voluntary specific

51
Q

A judgment lien differs from a mechanic lien by

A

Mechanic lien has Priority earlier than recording

52
Q

When do mechanic liens take place for a new house?

A

Beginning of construction

53
Q

Even when all the work is done themselves, when can a mechanic lien still take in effect

A

Failure to pay for materials

54
Q

After the completion of work is recorded, how long do you have till you can file a mechanic lien

A

60 days to file

55
Q

After the completion of work is NOT recorded, how long do you have till you can file a mechanic lien

A

90 days to file

56
Q

What is NOT considered a negotiable instrument

A

Mortgage

57
Q

In a trust deed, what evidence describes a promissory note

A

Evidence of debt

58
Q

In a trust deed, who is the trustor

A

The borrower

59
Q

In a trust deed, what does the trustor sign

A

Note and trust deed

60
Q

In a trust deed, what does the beneficiary do

A

Loans money

61
Q

In a trust deed, who gives the power to sell

A

Trustor to trustee (3rd party)

62
Q

In a trust deed, what does the trustee give to the beneficiary

A

Fiduciary to beneficiary

63
Q

In a trust deed, what are the services of trustee

A

Trustee’s sale and reconveyance deed

64
Q

What is a reconveyance deed

A

Request for full reconveyance, has 21 calendar days from request to cooperate

65
Q

After a Notice of default is recorded, how long until sale of property?

A

4 months to sale

66
Q

After date of sale is published, how long until sale of property?

A

21 days to sale

67
Q

How long do you have for reinstatement from foreclosure

A

5 days before sale

68
Q

At sale, winner gets

A

Trustee’s deed

69
Q

Explain the subordination clause

A

Rights of beneficiary are secondary

70
Q

When are construction loan funds released?

A

Released after lien period

71
Q

Who is involved in a mortgage contract

A

Mortgagor and mortgagee

72
Q

Explain court (judicial) foreclosure

A

Deficiency judgment, 1 year right of redemption

73
Q

In a court (judicial) foreclosure, what is considered for the trustee’s sale

A

Trustee’s sale is final, no recourse

Real Estate Exam (8 decks)

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