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Texas Real Estate Exam > Real Estate Finance 2 > Flashcards

Real Estate Finance 2 Flashcards

1
Q

THe process of making a lending decision is known as:

A

Underwriting

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2
Q

Each consumer has three different credit scores form the three major credit reporting agencies because:

A

Not all creditors report to all of the agencies

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3
Q

____ typically extend loans with their own funds, at their own risk.

A

Correspondent lenders

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4
Q

The collecting of monthly payments and the maintenance of records of payments and balances is known as:

A

Servicing

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5
Q

Locally, real estate values are affected by:

A
  • availability of employment
  • population trends
  • local government policies
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6
Q

____ is the maintenance of a stable money supply that provides for growth in the economy while keeping inflation in check

A

Monetary policy

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7
Q

The ____ is responsible for raising money to support the spending decisions of the congress.

A

US Treasury

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8
Q

The US Mint is part of the ____

A

Department of the Treasury

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9
Q

Banks and federal savings associations are regulated by the ____

A

Office of the Comptroller of the Currency

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10
Q

In residential lending, mortgage brokers, bankers and correspondent lenders are no universally known as:

A

Residential Mortgage Loan Originators (RMLOs)

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11
Q

All residential mortgage loan originators must now be registered with:

A

NMLS

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12
Q

USDA loans are available for:

A

Primary residences only

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13
Q

According to the Loan Estimate, services you cannot shop for include:

A

Credit Report Fee

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14
Q

The Loan Estimate form replaces which of the following forms?

A

The Good Faith Estimate

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15
Q

THe Community Development Block Grants (CDBG) Program was created in ____ to help communities with economic development job opportunities and housing rehabilitation.

A

1974

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16
Q

Federal Fair Housing statues prohibit housing discrimination based on which of the following?

A. Sexual orientation
B. Age
C. Occupation
D. National origin

A

National Origin

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17
Q

A sales contract in which the buyer agrees to make regular payments to the seller for equitable title

A

Contract for deed

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18
Q

Debt instrument which attaches to all the property of the debtor not exempt from forced sale

A

General lien

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19
Q

Lending institution asset classification for property obtained through a foreclosure

A

Real Estate Owned (REO)

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20
Q

A claim, lien, charge, or liability attached to and binding real property

A

Encumbrance

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21
Q

The legal procedure whereby the secured property may be sold to satisfy the unpaid promissory note

A

Foreclosure

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22
Q

A(n) ____ is a right given by law to creditors to have debts paid out of the property of a defaulting debtor.

A

Lien

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23
Q

Deed restrictions, easements, and CC&Rs are examples of ____ on real property.

A

Encumbrances

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24
Q

A ____, also known as a real estate lien note, is the borrower’s unconditional promise to repay, and is not typically recorded.

A

Promissory note

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25
Q

A ____, also known as a real estate lien note, is the borrower’s unconditional promise to repay, and is not typically recorded.

A

Promissory note

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26
Q

Under a(n) ____, when the final payment is made to the seller, title automatically transfers to the buyer.

A

Contact for deed

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27
Q

A deed of trust mortgage which is in default does not require a ____, in most cases.

A

Judicial foreclosure

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28
Q

Prepayment penalties can be found in more than two-thirds of _____.

A

Sub-prime mortgages

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29
Q

The promissory note form identifies the lender, the place of repayment, and the ____.

A

Borrower

30
Q

The lender may also be referred to as the ____ in some deed of trust forms.

A

Mortgagee

31
Q

A loan which covers more than one piece of property

A

Blanket mortgage

32
Q

Excessive selling/lending activity for the purpose of generating fees and commissions

A

churning

33
Q

Percentages based on the amount of the loan

A

points

34
Q

Partially-amortized loan with a substantially larger final payment

A

balloon loan

35
Q

Conventional loans that conform to FNMA/FHLMC standards

A

conforming loan

36
Q

Loans which have no federal government guarantees or insurance and come from traditional sources are known as ____.

A

Conventional loans

37
Q

____ is one in which the interest rate remains the same for the entire term.

A

Fixed-rate mortgage

38
Q

Disadvantages of adjustable rate mortgages include possibly increased monthly payments, ____, borrower confusion, and higher long-term costs.

A

the inability to refinance early

39
Q

A(n) ____ is a partially-amortized loan with a final payment that is substantially larger than the previous payments.

A

balloon note

40
Q

The practice of ____ occurs when unscrupulous lenders take advantage of a consumer’s lack of knowledge regarding lending practices.

A

predatory lending

41
Q

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 ____.

A

shared appreciation mortgage

42
Q

The rate charged on an adjustable rate mortgage until the first adjustment date is known as the ____.

A

initial rate

43
Q

The ratio of the borrower’s total recurring monthly debts

A

Back ratio

44
Q

Insurance cost based on the loan-to-value ratio

A

Annual premium

45
Q

Commonly known as the GI Bill of Rights

A

Servicemen’s Readjustment Act

46
Q

Direct loans for construction or improvement on Federal Trust Land

A

Native American Direct Loan

47
Q

The size of loan a veteran may receive, determined by term of service

A

Entitlement

48
Q

Maximum ratios for FHA loans are…

A

31% front ratio/43% back ratio

49
Q

The Serviceman’s Readjustment Act, signed into law in ____, is more commonly known as the GI Bill of Rights.

A

1944

50
Q

An FHA borrower can use gift funds from a(n) _____ as funds for a downpayment.

A

Parent

51
Q

A cash-out refinancing loan is a loan guaranteed by the ____ which refinances any type of lien against a secured Roberts.

A

VA

52
Q

Specially Adapted Housing Grants are revised to veterans and service members with disabilities for the purpose of…

A
  • Constructing specially adapted homes
  • Remodeling an existing home suitable for adaptation
  • Applying funds to unpaid principal of previously purchased existing adapted homes
53
Q

Seller contributions to buyer closing costs for FHA loans are limited to ____ of the sales price.

A

6%

54
Q

_____ are subject to a limitation on seller concessions, 4% of the reasonable value of the Roberts.

A

VA-guaranteed loans

55
Q

The most probable price a property should bring on the open market

A

market value

56
Q

The reduction in value of property from deterioration or obsolescence

A

Depreciation

57
Q

Form which replaces the Good Faith Estimate

A

Loan Estimate

58
Q

Form lenders use to obtain borrower balance information

A

Verification of Deposit (VOD)

59
Q

Ratio of proposed loan payment to GMI

A

Front ratio

60
Q

The ____ promulgates forms for the preparation of pre-qualification and pre-approval of financing.

A

Texas Department of Savings and Mortgage Lending

61
Q

Downpayment sources may include ____.

A
  • Gift funds
  • Stocs
  • Bonds
62
Q

The borrower s asked to provide their full name, ____, SoCal security number, and present address in Part III of the Unform Residential Loan Application.

A

Marital status

63
Q

A(n) ____ transfers ownership of property from the government to an individual.

A

Patent

64
Q

For a property to have value, it must have four characteristics, including demand, scarcity, ____, and transferability.

A

Utility

65
Q

The sales comparison approach focuses on ____, or recent sales of similar properties, to determine value.

A

Coma parables

66
Q

A property which s being appraised is commonly referred to as the…

A

Subject Property

67
Q

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 ____.

A

Loan Estmate

68
Q

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 ____.

A

Provide title insurance

69
Q

A chronological list of oweners n the title history of a property s known as a(n):

A

Chan of title

70
Q

The ratio of a borrower’s total recurring monthly debts to gross monthly come is called the ____.

A

Back ratio

Texas Real Estate Exam (19 decks)

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