Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Real Estate Exam > Level 4 Financing > Flashcards

Level 4 Financing Flashcards

1
Q

a clause in a security instrument which makes the entire loan amount due immediately upon default

A

acceleration clause

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

a mortgage with an interest rate that can be adjusted based on fluctuations in the cost of money

A

adjustable-rate mortgage

ARM

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

a provision in the mortgage contract that triggers the payment in full of the loan upon the sale or conveyance of the property; also known as the due-on-sale clause

A

alienation clause

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

the process of paying off a debt/mortgage in regular

installments based on a fixed payment schedule

A

amortization

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

the annual rate charged in interest for borrowing

A

annual percentage rate

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

a payment that occurs at the end of a period to compensate for charges accrued during that time

A

arrears

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

the process of transferring the obligation of the mortgagor to
another party who takes over the responsibility to pay the note

A

assumption

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

a payment at the end of a loan period which includes the total outstanding balance of the loan

A

balloon payment

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

any loan that is neither insured by a government agency nor guaranteed by a government agency

A

conventional loan

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

a ratio of debt to income used in commercial properties

A

debt service coverage

ratio

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

the ratio of debt to the value of the property

A

debt-to-income ratio

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

a right to real property being held by one party for the benefit of another

A

deed of trust

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

court order that requires the defaulted borrower to pay any remaining balance owed to the lender, generally after the sale of a foreclosed property

A

deficiency judgment

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

the right of a borrower in default to reclaim their property before foreclosure by paying all past due mortgage payments

A

equitable redemption

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

government agency that provides mortgage insurance on loans made by FHA-approved lenders

A

Federal Housing

Administration (FHA)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

the legal process whereby a lender takes control of a property held by a borrower in default and sells it to recover the lender’s losses

A

foreclosure

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

government-owned entity that supports the secondary

mortgage market by guaranteeing mortgage-backed securities (MBS) insured by the U.S. government

A

Ginnie Mae

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

corporations created to enhance the flow of credit in the economy; most notably Fannie Mae and Freddie Mac

A

government-sponsored

enterprises (GSEs)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

a loan in which funds are borrowed using the homeowner’s equity for collateral

A

home equity loan

20
Q

granting real property as collateral for a mortgage loan

A

hypothecation

21
Q

the facilitation by a third party of a financial transaction

between two parties

A

intermediation

22
Q

additional money paid to a lender for the use of their money

A

interest rate

23
Q

a foreclosure that is processed through the court

A

judicial foreclosure

24
Q

a lender’s approval of a specific loan for a specific property

A

loan commitment

25
Q

a predatory lending technique that involves coaxing lendees to repeatedly refinance their loans, adding fees and prepayment penalties each time

A

loan flipping

26
Q

the amount of money being loaned compared to the value of

the property

A

loan-to-value ratio

27
Q

the adding of interest payments to the principal balance; occurs when a borrower’s payment is not large enough to cover the interest due

A

negative amortization

28
Q

a document that promises payment to party, but can be sold, traded, or assigned to a another party

A

negotiable instrument

29
Q

a foreclosure that does not involve a suit or ruling of the court — the two types are power-of-sale foreclosures and strict foreclosures

A

non-judicial foreclosure

30
Q

fees pay for the cost of issuing the loan

A

origination fee

31
Q

a loan fee that is one percent of the loan

A

point

32
Q

the first step in the loan application process in which lenders give prospective borrowers a general estimate of the loan amount for which they may be approved

A

pre-qualification

33
Q

the market in which loans are originated/created/funded by the lender

A

primary mortgage market

34
Q

insurance that protects the lender if a borrower defaults on a conventional loan; usually required when the borrower has less than 20% equity

A

private mortgage insurance

35
Q

document where the borrower acknowledges their debt to the lender and promises to repay the holder of the note

A

promissory note

36
Q

a loan in which the buyer borrows from the seller in addition to the lender

A

purchase-money mortgage

37
Q

a length of time after foreclosure that the defaulting borrower has to reclaim the property

A

redemption period

38
Q

the act of replacing an old loan with a new loan

A

refinancing

39
Q

the part of the Truth in Lending Act (TILA) that seeks to protect consumers by requiring proper disclosures and fair lending practices

A

Resignation Z

40
Q

the right of a borrower to reclaim property that has been foreclosed upon

A

right of redemption

41
Q

a mortgage on a property that already has a mortgage

A

second mortgage

42
Q

the market in which already-existing mortgages are sold and re-sold to investors

A

secondary mortgage market

43
Q

the collateral for a loan

A

security

44
Q

when the seller of a property acts as the lender; the buyer makes mortgage payments directly to the seller

A

seller financing

45
Q

a mortgage with an interest rate higher than prime mortgages due to the higher risk associated with a less qualified borrower

A

subprime loan

46
Q

the process of deciding the level of risk a lender would take on by offering a loan to a certain borrower for a specific property

A

underwriting

47
Q

laws that limit interest rates

A

usury

Real Estate Exam (8 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions