mock 11 Flashcards
Your clients are retired and have decided to supplement their income with a reverse annuity mortgage (RAM) based on the security of their $600,000 home. The terms of the mortgage specify an interest rate of 6% per annum, compounded monthly and that the borrower will receive $1,500 per month. The bank decides that the RAM will not exceed 60% of market value of the home at the time the loan was written. How many full payments will be received during the term of the loan?
- 158
- 117
- 142
- 165
- 158
A borrower has decided to pay one half of a monthly payment on their mortgage loan every two weeks, The effect is that the borrower makes the equivalent of one extra monthly payment per year, thus paying down the principal faster and paying less interest. The borrower is
- making bi-weekly interest only payments.
- making bi-weekly accelerated payments
- making bi-weekly accelerated interest accruing payments
- in a reverse annuity mortgage
- making bi-weekly accelerated payments
Doug makes a written offer to Todd; Which is the following will NOT release Doug offer?
- Doug discovers later that Todd is illiterate.
- Todd fails to accept the offer before the expiry of the time limit specified in the offer.
- Todd makes a counter-offer
- Doug revokes his offer to Todd via telephone
- Doug discovers later that Todd is illiterate.
Your Client is purchasing a single-family home for personal use with a ending value of $450,000, using an insured mortgage. What is the maximum loan allowed under the mortgage loan insurance program?
- $440,000
- $360,00
- $382,750
- $427,000
- $427,000
Which of the following interests in land require a dominant and servient tenement?
Life estates Easements Freehold estates Profits a prendre 1. B only 2. A and C only 3. B, C and D only 4. All of the above
- B only
In mortgage lending, a ‘bonus’ is:
- the mortgage principal amount outstanding at any point in time
- the fee charged by a mortgage broker that can be deducted or added to the future value of the loan
- always subtracted from the ceiling price of the property
- the portion of the face value of a mortgage loan which exceeds the funds actually received by the borrower
- the portion of the face value of a mortgage loan which exceeds the funds actually received by the borrower
With which one of the following loans is the lender’s initial capital and periodic income at the greatest risk?
- straight line principle reduction loans
- accelerated bi-weekly loans
- interest only loan
- interest accruing loans
- interest accruing loans
Under the Builders Lien Act, within how many days of the substantial completion, end or abandonment of a project must a claimant file a builders lien?
- 15 days
- 30 days
- 45 days
- 90 days
- 45 days
Arbitration is a form of Alternative Dispute Resolution (ADR) that
- involves voluntary and informal attempts to seek mutually acceptable solution between two parties
- involves the parties authorizing a neutral party to decide the outcome of their dispute.
- is held in a formal court of law
- is always turned to when one party adds an “eleventh hour throw in”
- involves the parties authorizing a neutral party to decide the outcome of their dispute.
Generally speaking, the ethical duty of professional courtesy and good faith is owned to:
- client of the mortgage broker
- fellow mortgage broker
- the Registrar of the mortgage broker
- oneself.
- client of the mortgage broker
Which of the following statements is TRUE?
- The adjustment date and the possession date must be the same day.
- a deposit paid by a buyer will appear on the buyer’s statement of adjustments as a debt.
- It is standard practice to hold the buyer responsible for the taxes on the adjustment date itself.
- The total of the credit column on the seller’s statement of adjustments will always be e identical to the total of the debit column on the seller’s statement of adjustments.
- It is standard practice to hold the buyer responsible for the taxes on the adjustment date itself.
A young executive has applied to her bank for a Mortgage loan to enable her to purchase a house. Her income is
$55000 per year. the bank inform her they will apply 32% gross debt service ratio when calculating her maximum loan, and that the current mortgage rates are 3.9 % per annum, compounded semi annually for 20 year amortization mortgages. The bank of Canada’s posted 5 year rate is 6.2 % per annum, compounded semi annually. Annual property taxes are $2000 and mortgage payments are to be made monthly.what is the maximum Mortgage loan the bank will grant, given the stress test borrower qualification rules for an insured mortgages?
- $1867,963.81
- $188,106.38
- $157,906.22
- $179,693.93
- $179,693.93
When a judge ‘distinguishes’ a case on its facts, he or she:
- highlights of former decision as one that establishes an important legal principal.
- Formally reports the case before him or her since it is a crucial decision
- Follows a former decision because it is based on similar facts
- Decides that facts crucial to a formal decision are not present in the case at hand and therefore, that form a decision should not be followed
- Decides that facts crucial to a formal decision are not present in the case at hand and therefore, that form a decision should not be followed
Which of the following items will NOT appear on the buyer’s statement of adjustments?
- cash proceeds of the sale
- purchase price
- property transfer tax
- balance due to complete
- cash proceeds of the sale
Which of the following is NOT a privacy principle from the Personal Information Protection Act?
- Limit collection
- Obtain consent
- Provide recourse
- Identify the proposal
- Identify the proposal
Which of the following statements is TRUE with respect to damages for breach of contract?
- A completely innocent party is not required to mitigate his or her damages.
- Damage awards are intended to punish the party who breached the contract.
- If the parties to a contract provide for a genuine pre-estimate of foreseeable damages in the contract, that amount will be enforceable, even if the actual loss is lower or higher.
- At common law, damages can only be awarded for the breach of a condition.
- A completely innocent party is not required to mitigate his or her damages.
A real estate investment trust is:
- taxed at corporate income tax rates
- created to invest in mortgages or properties
- managed by the Registrar of Companies
- a combination of three legal entities, which cooperate in carrying out real estate development
- created to invest in mortgages or properties
Which of the following statements about corporations are TRUE?
corporation is subject to income tax, unlike a partnership
Only shareholders are entitled to manage a corporation in accordance with the Business Corporations Act
A corporation whose shares are traded on a stock exchange is referred to as a private Company
Individuals who acquire shares in a company do not own the assets of the company
1. Only statements A and D are true
2. Only statements A, B and C are true.
3. Only statements B and D are true
4. A, B,C and D are true
- Only statements A and D are true
Eric and Mandy own a unit in Poppyseed Place, a beautiful strata development that sits on the waterfront of a lake in northern British Columbia They bought the unit five years ago as joint tenants and have rented it out to Ms Johnson, who continues to occupy the unit Mandy has recently passed away, and her will gifted her interest in the unit to her son, Melvin. Melvin has now contacted Eric and is demanding that he be paid one-half of the rent paid by Ms. Johnson Which of the following statements is FALSE?
Upon Mandy’s death, the entire interest remains with the surviving joint tenant, Eric
By gifting her interest in the unit to Melvin, Mandy severed the joint tenancy.
Melvin and Eric now own the unit as tenants in common
Melvin and Eric now own the unit as joint tenants
1. Only A is false
2. Only D is false
3. Only A and D are false
4. Only B, C and D are false
- Only B, C and D are false
In marketing, the initial trigger that starts the buying process is known as:
- The buying decision
- Self actualization
- The product purchase activity
- A felt need
- A felt need
You were recently hired by an appraisal company. You were asked by your boss to appraise the following for properties:
A concrete plant n the garden
A small single-family house in the central business district of Langley
A residential condominium in Richmond
A multi-unit apartment complex in Coquitlam
Which appraisal method would be more suitable to appraise each of these properties?
- A) income; B) market comparison; C) residual; D) cost
- A) residual; B) cost; C) market comparison; D) income
- A) market comparison; B) income; C) cost; D) residual
- A) cost; B) residual; C) market comparison ; D) income
- A) cost; B) residual; C) market comparison ; D) income
Which one of the following is NOT an appraisal approach to value?
- the income approach
- the redevelopment approach
- the direct comparison approach
- the cost approach
- the redevelopment approach
Which of the following statements regarding alternative repayment and refinancing methods is/are TRUE?
A sinking fund assisted mortgage is a loan repayment plan which reduces the amount of the initial payments in order to improve affordability.
In a variable rate mortgage, the interest rate is changed periodically but the required payment is never changed
One of the benefits to the “blend and extend option of refinancing is that it helps borrowers avoid prepayment penalties
In graduated payment mortgages, payments are decreased during the loan term
1. Only statements B and D are true.
2. Only statements A and C are true
3. Only statements A, C, and D are true.
4. All of the above statements are true.
- Only statements A and C are true
Consider the following information about a commercial property
Gross Potential Revenue $115,000
General Operating Expenses $ 45,000
Vacancy and Bad Debt Allowance 4% of Gross Potential Revenue
Given a capitalization rate of 15 %, how much should an investor pay for this property?
- $716,000
- $460,667
- $340,000
- $436,000
- $436,000