Real Estate Finance 2 Flashcards
THe process of making a lending decision is known as:
Underwriting
Each consumer has three different credit scores form the three major credit reporting agencies because:
Not all creditors report to all of the agencies
____ typically extend loans with their own funds, at their own risk.
Correspondent lenders
The collecting of monthly payments and the maintenance of records of payments and balances is known as:
Servicing
Locally, real estate values are affected by:
- availability of employment
- population trends
- local government policies
____ is the maintenance of a stable money supply that provides for growth in the economy while keeping inflation in check
Monetary policy
The ____ is responsible for raising money to support the spending decisions of the congress.
US Treasury
The US Mint is part of the ____
Department of the Treasury
Banks and federal savings associations are regulated by the ____
Office of the Comptroller of the Currency
In residential lending, mortgage brokers, bankers and correspondent lenders are no universally known as:
Residential Mortgage Loan Originators (RMLOs)
All residential mortgage loan originators must now be registered with:
NMLS
USDA loans are available for:
Primary residences only
According to the Loan Estimate, services you cannot shop for include:
Credit Report Fee
The Loan Estimate form replaces which of the following forms?
The Good Faith Estimate
THe Community Development Block Grants (CDBG) Program was created in ____ to help communities with economic development job opportunities and housing rehabilitation.
1974
Federal Fair Housing statues prohibit housing discrimination based on which of the following?
A. Sexual orientation
B. Age
C. Occupation
D. National origin
National Origin
A sales contract in which the buyer agrees to make regular payments to the seller for equitable title
Contract for deed
Debt instrument which attaches to all the property of the debtor not exempt from forced sale
General lien
Lending institution asset classification for property obtained through a foreclosure
Real Estate Owned (REO)
A claim, lien, charge, or liability attached to and binding real property
Encumbrance
The legal procedure whereby the secured property may be sold to satisfy the unpaid promissory note
Foreclosure
A(n) ____ is a right given by law to creditors to have debts paid out of the property of a defaulting debtor.
Lien
Deed restrictions, easements, and CC&Rs are examples of ____ on real property.
Encumbrances
A ____, also known as a real estate lien note, is the borrower’s unconditional promise to repay, and is not typically recorded.
Promissory note
A ____, also known as a real estate lien note, is the borrower’s unconditional promise to repay, and is not typically recorded.
Promissory note
Under a(n) ____, when the final payment is made to the seller, title automatically transfers to the buyer.
Contact for deed
A deed of trust mortgage which is in default does not require a ____, in most cases.
Judicial foreclosure
Prepayment penalties can be found in more than two-thirds of _____.
Sub-prime mortgages
The promissory note form identifies the lender, the place of repayment, and the ____.
Borrower
The lender may also be referred to as the ____ in some deed of trust forms.
Mortgagee
A loan which covers more than one piece of property
Blanket mortgage
Excessive selling/lending activity for the purpose of generating fees and commissions
churning
Percentages based on the amount of the loan
points
Partially-amortized loan with a substantially larger final payment
balloon loan
Conventional loans that conform to FNMA/FHLMC standards
conforming loan
Loans which have no federal government guarantees or insurance and come from traditional sources are known as ____.
Conventional loans
____ is one in which the interest rate remains the same for the entire term.
Fixed-rate mortgage
Disadvantages of adjustable rate mortgages include possibly increased monthly payments, ____, borrower confusion, and higher long-term costs.
the inability to refinance early
A(n) ____ is a partially-amortized loan with a final payment that is substantially larger than the previous payments.
balloon note
The practice of ____ occurs when unscrupulous lenders take advantage of a consumer’s lack of knowledge regarding lending practices.
predatory lending
A participation loan in which a lender collects principal and interest and shares in profits when a property is sold is sold is called a ____.
shared appreciation mortgage
The rate charged on an adjustable rate mortgage until the first adjustment date is known as the ____.
initial rate
The ratio of the borrower’s total recurring monthly debts
Back ratio
Insurance cost based on the loan-to-value ratio
Annual premium
Commonly known as the GI Bill of Rights
Servicemen’s Readjustment Act
Direct loans for construction or improvement on Federal Trust Land
Native American Direct Loan
The size of loan a veteran may receive, determined by term of service
Entitlement
Maximum ratios for FHA loans are…
31% front ratio/43% back ratio
The Serviceman’s Readjustment Act, signed into law in ____, is more commonly known as the GI Bill of Rights.
1944
An FHA borrower can use gift funds from a(n) _____ as funds for a downpayment.
Parent
A cash-out refinancing loan is a loan guaranteed by the ____ which refinances any type of lien against a secured Roberts.
VA
Specially Adapted Housing Grants are revised to veterans and service members with disabilities for the purpose of…
- Constructing specially adapted homes
- Remodeling an existing home suitable for adaptation
- Applying funds to unpaid principal of previously purchased existing adapted homes
Seller contributions to buyer closing costs for FHA loans are limited to ____ of the sales price.
6%
_____ are subject to a limitation on seller concessions, 4% of the reasonable value of the Roberts.
VA-guaranteed loans
The most probable price a property should bring on the open market
market value
The reduction in value of property from deterioration or obsolescence
Depreciation
Form which replaces the Good Faith Estimate
Loan Estimate
Form lenders use to obtain borrower balance information
Verification of Deposit (VOD)
Ratio of proposed loan payment to GMI
Front ratio
The ____ promulgates forms for the preparation of pre-qualification and pre-approval of financing.
Texas Department of Savings and Mortgage Lending
Downpayment sources may include ____.
- Gift funds
- Stocs
- Bonds
The borrower s asked to provide their full name, ____, SoCal security number, and present address in Part III of the Unform Residential Loan Application.
Marital status
A(n) ____ transfers ownership of property from the government to an individual.
Patent
For a property to have value, it must have four characteristics, including demand, scarcity, ____, and transferability.
Utility
The sales comparison approach focuses on ____, or recent sales of similar properties, to determine value.
Coma parables
A property which s being appraised is commonly referred to as the…
Subject Property
Both the HUD-1 and the Good Faith Estimate (GFE) forms have been replaced, the HUD-1 by the new Closing Disclosure Form, and the FGE by the new ____.
Loan Estmate
During closing, a seller must sign a deed which conveys the property authorize the payoff of any existing lens, sign additonal documents and if stipulated n the contract ____.
Provide title insurance
A chronological list of oweners n the title history of a property s known as a(n):
Chan of title
The ratio of a borrower’s total recurring monthly debts to gross monthly come is called the ____.
Back ratio
