Unit 5

Question 1

Pass through

Answer 1

• type of MBS
• functions as a financial trust where investors buy shares
• investors are paid their share of payments made on the mortgages in a trust

Question 2

Conventional Conforming mortgages are sold to…

Answer 2

Fannie and Freddie

Question 3

Conventional Conforming mort. are considered high/low quality?
Why?

Answer 3

High quality, since they meet Fannie/Freddie standards

Question 4

Can conventional and non-conventional loans be packaged together?

Answer 4

No

Question 5

What does a Deed of Reconveyance show?

Answer 5

• Names of lender/borrower
• address and legal identification of the property
• initial loan amount
• where in county records the original transaction documents were filed

Question 6

Selling the home requires the Borrower to ___ their current mortgage loan(s).

What other situation requires this?

Answer 6

Repay their current loans in full

If title is transferred

Question 7

What is sent to the borrower if they haven’t made their payment in 90 days?

(Two names for this)

Answer 7

The Demand Letter/Acceleration Notice

Question 8

At the 4th month of missed payments, generally the ___ begins

Answer 8

Foreclosure proceedings

Question 9

At the 4th month, what will the servicer do?

Answer 9

Refer the Borrower to an attorney

Question 10

Lien Theory State

Answer 10

Borrower has the right to the title, so the lender will need to go through the court to continue w/ foreclosure process

Question 11

Title theory state

Answer 11

Lender holds the legal title to the property, until debt is paid in full; lender can foreclose w/o court proceedings

Question 12

Lien Theory states require what type(s) of foreclosure?

Any limits?

Answer 12

Judicial Foreclosure (allowed in all states)
Or 
Strict foreclosure (limited to a few states)

Question 13

Title Theory States require which type(s) of foreclosure?

Any limits?

Answer 13

Non-Judicial Foreclosure AKA Power of Sale foreclosure

Not allowed in all states