Loan Origination Activities Flashcards
Under what circumstances would it be possible to consider capital gains as income for a fannie mae or freddie mac loan?
If the borrower can verify a minimum of two years income on their tax returns and still own the asset.
True/False - interest rate, loan type, margin, LTV, credit score, presence of MI, pre payment risk are all factors of the SRP (service release premium).
True
The lender discloses the prepayment penalty on which of the following documents?
Loan Estimate
How long does a foreclosure have to be seasoned when a borrower is looking to obtain a conventional mortgage?
7 years
When you order an insurance binder on a borrower’s loan, the one-page sheet that summarizes all the insurance information is known as the:
Declaration page
What is the note rate for a $150,000 loan with a 2/1 buy down when the borrowers start with a payment rate of 4% for 12 months; then 5% for another 12 months; then 6% for the rest of the payment term?
The note rate is the interest rate after the buy down, which in this situation is 6%
If a borrower is going to be denied financing based on an incomplete application, what needs to be done?
Send a written notice of incompleteness within 30 days of the last action taken or of the incompleteness.
The lender is requiring repairs on the home to be completed. Those repairs can be done after the loan closes by including them in an:
Escrow holdback
A borrower has an interest only loan and wishes to make the minimum monthly payments required. If the homeowner decides to payoff the loan at the end of the loan term, what will the homeowner be required to pay?
The original loan amount
Private Mortgage Insurance is required on a conforming 1st mortgage loans when the loan-to-value is:
Above 80%
What are two of the most important documents the borrower signs at settlement?
The promissory note and the deed of trust
Your customer owns several rental properties, one-third of which have a negative net lease. Therefore, you can conclude that:
The rent received is less than or equal to the amount they have to pay on the mortgage each month.
On an FHA annually adjusting ARM, assume that the starting rate was 5%; the margin is 2.5%; the index in 6 months is 3%; the index in 12 months is 3.5%; the index in 18 months is 3.25%. What is the borrower’s interest rate in 18 months?
6%
If there are two borrowers on a loan, but the two borrowers are unmarried, they would be considered what?
co-mortgagors
At closing, the borrower should receive a notice of the right to rescind. If two copies are not provided to the borrower at closing, the right to rescind extends from 3 days to?
3 years after closing, transfer of the interest in the property, or sale of the property, whichever comes first.
