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Test your basic knowledge |
Mortgage Lending Industry
Start Test
Study First
Subjects
:
personal-finance
,
industries
Instructions:
Answer 46 questions in 15 minutes.
If you are not ready to take this test, you can
study here
.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.
This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. A third party with a power of sale allowing him to foreclose without going to court
trustee
USDA loan features
correspondent lender
private mortgage insurance payment stoppage
2. An owner - or other person with an interest in the property may - by paying off the entire debt and court costs - reclaim the property following a foreclosure
statutory right of redemption
defeasance clause
FHA upfront mortgage premium
private mortgage insurance payment stoppage
3. Up to 6% of the purchase price toward the buyer's actual closing costs - prepaid taxes and insurance - discount points - buydown fees - mortgage insurance premiums - and other financing concessions - but nothing toward the down payment
loan originator
FHA acceptable seller contribution
conforming conventional loan requirements
secondary mortgage market
4. Has lower priority even though it may have had priority based on its date of recording; or will remain subordinate in the event that the first mortgage is refinanced
portfolio lender
Construction financing
subordination clause specifications
VA loan features
5. An immediate relative - a labor union or employer - a government agency or public entity - a nonprofit charitable organization
Acceptable gift suppliers
budget (PITI) mortgage
power-of-sale provision
correspondent lender
6. To collect the loan payments from the borrower
service (a loan)
promissory note information
power-of-sale provision
prime rates
7. Act of transferring property title from one person to another
beneficiary
budget (PITI) mortgage
conveyance
correspondent lender
8. Term LTV Annual MIP Cancellation - > 15 yrs | > 95% | .55% | LTV 78%; payments 5 years - > 15 yrs | < 95% | .50% | LTV 78%; payments 5 years - < 15 yrs | > 90% | .25% | LTV 78% - < 15 yrs | < 90% | None | N/A
statutory right of redemption
FHA annual mortgage premium and cancellation
primary (first) mortgage
forbearance
9. A third-party lender provides actual funds for the loan
hard money loan
subordination clause specifications
equitable right of redemption
trustee
10. Takes or receives mortgage applications - assembles information - and prepares the paperwork and documentation necessary for obtaining a mortgage loan
Home Equity Conversion Mortgage
power-of-sale provision
grantor (trustor)
loan originator
11. The seller finances the purchase and does not actually give the buyer any cash
equitable title
mortgagor
level payment mortgage
soft money loan
12. The veteran borrower is charged a nonrefundable upfront funding fee - which can be financed - instead of a mortgage insurance premium - for the guarantee; no down payment up to the Freddie Mac conforming loan limit; seller can pay all of the borrower
conveyance
Fed actions against inflation
mortgagor
VA loan features
13. An owner - or other person with an interest in the property may - by paying off the entire debt and court costs - prevent a foreclosure sale
loan level price adjustment
wholesale lender
equitable right of redemption
defeasance clause
14. The lender receiving the trust deed
Federal Open Market Committee
forbearance
beneficiary
FHA acceptable seller contribution
15. When the loan is paid down to 78% or 80% of the value of the property at the time the loan was taken
beneficiary
table funding
private mortgage insurance payment stoppage
primary (first) mortgage
16. Allows the lender to declare the entire balance of the loan due at once; or refuse to allow another person to assume the loan - if the title is transferred
VA loan features
Home Equity Conversion Mortgage
hypothecation
due-on-sale (alienation) clause
17. The property is pledged as security - or collateral - but the borrower does not actually give up legal title or possession
VA loan features
power-of-sale provision
table funding
hypothecation
18. The payor and payee - the amount owed - the rate of interest - and whether it is fixed or adjustable - the due date(s) for payment - loan terms - Which may include: a prepayment privilege - a prepayment penalty - a lock-in clause - an acceleration cl
Fed actions against inflation
mortgagor
trustee
promissory note information
19. A defaulted borrower has a period after default to stop a foreclosure by paying all past-due payments and penalties and bringing the loan current - instead of having to pay off the entire debt
right of reinstatement
trustee
budget (PITI) mortgage
hypothecation
20. The borrower giving a trust deed to the lender
grantor (trustor)
Acceptable gift suppliers
equitable title
beneficiary
21. Provides for monthly mortgage payments to include an amount equal to 1/12 of the estimated annual property taxes and property insurance premiums - homeowners' association dues and/or special assessments
loan level price adjustment
FHA 203b
budget (PITI) mortgage
primary (first) mortgage
22. A lender that holds - rather than sells - its loans
portfolio lender
right of reinstatement
secondary mortgage market
primary (first) mortgage
23. Can be used to build - repair - rehabilitate - renovate or relocate a primary residence - or to purchase and prepare a site for one - including providing water and sewage facilities; 30-year term - a fixed interest rate set by the lender - no require
grantor (trustor)
USDA loan features
FHA 203b
VA loan features
24. The one who gives the mortgage; i.e. - the borrower or debtor
statutory right of redemption
due-on-sale (alienation) clause
beneficiary
mortgagor
25. Helps finance the purchase of a one- to four-unit family home that the borrower intends to occupy as his residence (i.e. - move in within 60 days after closing and stay in the property for 12 months) - using a 15- or 30-year loan and a cash investmen
subordination clause specifications
FHA 203b
table funding
power-of-sale provision
26. High-interest interim (or temporary) financing - used to finance the cost of labor and materials used during construction. It extends from start to completion of the work - when it is paid off - often with the proceeds of a more permanent form of fin
mortgagee
subordination clause specifications
USDA loan applicant requirements
Construction financing
27. Decides when the Fed will either buy government securities or sell them.
Federal Open Market Committee
FHA annual mortgage premium and cancellation
FHA 203b
FHA upfront mortgage premium
28. Provides for release of the lien when the borrower pays off the debt
defeasance clause
subordination clause specifications
secondary mortgage market
Acceptable gift suppliers
29. The lender
wholesale lender
due-on-sale (alienation) clause
trustee
mortgagee
30. Raise its asset reserve requirements for members - raise its target for the federal funds rate at Which members borrow from each other - raise the discount rate it charges members to borrow money from the Federal Reserve Bank - sell government securi
mortgagee
Fed actions against inflation
loan originator
defeasance clause
31. Must be without adequate housing; cannot qualify for a conventional home loan with private mortgage insurance; must have a steady income of up to 115% of the median income for the area - have a reasonable credit history and be able to afford the mort
Acceptable gift suppliers
Federal Open Market Committee
USDA loan applicant requirements
mortgagee
32. A lender (e.g. - a bank - savings bank - credit union or mortgage lender) that interacts directly with the borrower and actually makes the loan
prime rates
primary (first) mortgage
retail lender
secondary mortgage market
33. A mortgage broker will originate - process and close a loan underwritten and funded by a secondary lender in his own name - but then assign the loan to that lender at the closing table
Home Equity Conversion Mortgage
FHA annual mortgage premium and cancellation
wholesale lender
table funding
34. Allows a trustee to foreclose and sell the property on behalf of the lender without a court order and issue a trustee's deed conveying title to the purchaser
mortgagor
forbearance
power-of-sale provision
Acceptable gift suppliers
35. A mortgage investor that prices and funds loans applied for through mortgage brokers
portfolio lender
beneficiary
FHA 203b
wholesale lender
36. For most mortgages the premium is 2.25% of the loan amount - payable at closing or added to the loan amount and financed - nonrefundable
soft money loan
USDA loan applicant requirements
conforming conventional loan requirements
FHA upfront mortgage premium
37. A loan that enables a homeowner age 62 or older to convert some of the equity in his home to cash to pay living expenses
Fed actions against inflation
Home Equity Conversion Mortgage
conforming conventional loan requirements
service (a loan)
38. Total monthly payment doesn't change but the rate applied to principal and interest changes
FHA annual mortgage premium and cancellation
trustee
Federal Open Market Committee
level payment mortgage
39. A fee charged to lenders to compensate for certain loan features that increase the risk
defeasance clause
loan level price adjustment
secondary mortgage market
right of reinstatement
40. Allows a borrower experiencing temporary financial difficulty to delay his monthly mortgage payments for a short period of time
forbearance
FHA acceptable seller contribution
beneficiary
VA loan features
41. Where mortgages may be sold individually or bundled with other mortgages with similar features into mortgage-backed securities and sold on the equity market
secondary mortgage market
prime rates
wholesale lender
FHA annual mortgage premium and cancellation
42. The seller contribution up toward the buyer's closing costs can be up to 9% if the LTV is no more than 75% - 6% if the LTV is above 75% and less than 90% - or 3% if the LTV is 90% or higher - the maximum contribution is only 2% if the property is for
Federal Open Market Committee
equitable right of redemption
retail lender
conforming conventional loan requirements
43. The buyer is entitled to a deed conveying the legal title when the contract is fully paid and performed
trustee
equitable title
mortgagee
USDA loan features
44. Generally a smaller lender that takes applications and underwrites and funds loans either with its own money or from a line of credit with a larger lender and - immediately upon closing - sells the loans to wholesale lenders under previously agreed-u
USDA loan applicant requirements
primary (first) mortgage
correspondent lender
hypothecation
45. A loan that has priority over all other unsatisfied mortgages secured by the same property
defeasance clause
primary (first) mortgage
FHA 203b
grantor (trustor)
46. The lowest rates a lender charges for its best customers
Fed actions against inflation
statutory right of redemption
mortgagee
prime rates