ProSchools Flashcards
SAFE Act requirements apply to loans to purchase:
A.Dwellings as rental properties
B.Mobile homes to be used as residences, even if they’re not attached to the land
C.Dwellings if secured by mortgages, but not by trust deeds
D.Apartment buildings
B
The NMLS was established by:
The CSBS and AARMR
The transfer of title to real propertyfrom on party to another is called:
A conveyance
A defeasance clause in a security agreement probides that:
Upon repayment of the debt in full, the mortgage will be voided
A borrower who obtains a loan on the basis that he will be an owner-occupant must intend to:
A.Live in the property for at least 6 months
B.Move in within 30 days
C.Move in within 60 days
D.Live in the property for at least 5 years
C
The factors taken into account when granting a Home Equity Conversion Mortgage are:
Age, property value, interest rate
If the borrower is self-employed, he may need to verify his income by providing which of the following?
A. Tax returns
B. Tax returns and a current year-to-date profit-and-loss statement
C. Articles if Incorporation, typically filed with the state
D. A year-to-date profit-and-loss statement
B
Fot a sole proprietorship, the income, expenses and taxable profits are reported on:
Schedule C attached to IRS form 1040
The following are all appraisal approaches except:
A. Comparative market analysis
B. Sales comparison
C. Income
D. Cost
A - this is used by real estate agents for consumers who wish to sell their homes
In an appraisal, adjustments are made to the:
Comparable properties
Minimum number of comps for FNMA and FHLMC:
3
The appraisal approach in which the replacement value is calculated is called the:
Cost approach
Alimony and child support can be considered income if:
There’s proof of regular receipt and the payments are likely to continue for at least three years
FHA:
Housing expense ratio and DTI
31% and 43%
If a mortgagor pays $794.62 monthly to the mortgagee to be applied 1st to 7 percent interest and the balance to the principal, how much is applied to principle when the unpaid principal balance is $83,695.47?
$306
83,695 • .07 = 5,858.6829/12 = 488.22
794-488 = 306
A buyer offers $150,000 on a property that appraises for $145,000. If the borrower gets a conforming loan, he will need PMI if the loan amount exceeds:
$116,000
145,000 • .80 = 116,000
A borrower has a balance of $550,000, he makes a monthly payment of $5,000 with a rate of 6%. How much will go to principal? What will be the balance after this payment?
$2,250
$547,750
The LTV is the relationship of the ____ loan to the purchase price.
First loan
With regard to flood insurance, a lender is permitted to charge borrowers any of the following EXCEPT:
A. A fee for its overhead when it uses a third-party service for flood-zone determination or tracking
B. The cost of a third-party service for flood-zone determination or tracking
C. A fee for its life-of-the-loan tracking
D. A fee for its flood zone determinations
A:
They can charge for the cost of the service, but not overhead.
The law specifically permits lenders to charge borrowers a reasonable fee for flood zone determinations and life of the loan tracking, but if the lender uses a third-party to make the determination, it cannot charge more than the actual cost of the service.
Which of the following is credited to a borrower to pay his closing costs?
A. Service release premium
B. Yield spread premium
C. Prepaid expense premium
D. Loan origination fee
B.
The yield spread premium is credited to a borrower to pay his closing costs when the borrower accepts an interest rate above par. In fact, it enables the borrower to obtain financing of the closing costs. Service release premiums are a form of compensation to a lender upon sale of the servicing rights of a loan in the secondary market.
In what document does a mortgagee clause appear?
A. Deed of reconveyance
B. Property insurance policy
C. The note
D. The mortgage
B.
A mortgagee clause in an insurance policy will name the lender as a payee so that, in the event of a covered loss, the lender can ensure that the proceeds are applied to repairing the damage.
John Johnson obtained a 90 percent loan amounting to $63,000 to buy his house. If you had to pay two points for loan fees and for discount points for his loan, what some does he need for his portion of the settlement costs?
A. $4,200
B. $3,780
C. $10,780
D. $11,200
C
Because the loan was 90 percent of the value, the value was $70,000. Therefore, he paid $7000 down. He also paid $3780 in points. Therefore, the total paid was $10,780.
For how long after the date disclosures are required to be made or action is required to be taken must a creditor retain evidence of compliance with Regulation Z?
2 years
When a consumer exercises his right to rescind a loan under TILA, all loan fees must be refunded within:
20 days
A servicer must provide the borrower with an accurate statement of his current loan balance within how many days of receiving a request?
7
A higher-priced loan:
A. always requires the establishment of an escrow account
B. May not have a term of less than 12 months
C. May be used to finance construction of a single-family home
D. Jkabzhuxifme
B
A higher-priced loan cannot be used to finance the construction of a home, it cannot be a reverse mortgage, and it cannot have a term of less than 12 months
For which type of loan must a lender disclose that the borrower is not required to complete the loan agreement?
A. VA
B. FHA
C. ARM
D. High-cost home equity loan
D.
For any transaction that is subject to HOEPA, the lender must provide a disclosure to that effect
HPA requires that a lender notify the borrower of his rights regarding PMI when?
At closing, annually, and upon cancellation or termination of PMI
If PMI is paid by the lender, the lender must provide a written notice to the borrower that states:
The differences between lender-paid and borrower-paid PMI
According to RESPA, when two applicants jointly apply for a home purchase loan, a special information booklet:
A. Needs to be given to only one
B. Needs to be given to both
C. Is given only if requested
D. Needs to be given to neither
A
An annual escrow account analysis needs to be given within _ days of the end of the year being analysed.
30
The loan originator’s estimate of the charges and terms must be available for how long after the Loan Estimate is provided?
10 business days
Which of the following is designed to show all receipts and disbursements by the closing agent in a refinance transaction in which there is no seller?
A. Loan Estimate
B. Closing Disclosure
C. HUD-1
D. HUD-1A
B
All of the following are included in an ECOA adverse action notice except:
A. Name and address of the federal agency administering the loan originators compliance with ECOA
B. Names and contact numbers for consumer credit counseling agencies
C. A statement of the action taken
D. The ECOA Notice
B
How long does a number stay on the federal Do-Not-Call list?
Until the person removes it
Which of the following is not covered by HMDA?
A. A home equity loan used to pay off outstanding medical bills
B. A loan to purchase a mobile home or multi family dwelling
C. A loan to purchase a condominium unit
D. A home improvement loan made for the purpose of repairing, rehabilitating, or remodeling a dwelling
A.
