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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. 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
statutory right of redemption
equitable title
USDA loan features
mortgagor
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
table funding
service (a loan)
statutory right of redemption
due-on-sale (alienation) clause
3. The borrower giving a trust deed to the lender
FHA upfront mortgage premium
Acceptable gift suppliers
grantor (trustor)
budget (PITI) mortgage
4. Total monthly payment doesn't change but the rate applied to principal and interest changes
statutory right of redemption
mortgagor
hard money loan
level payment mortgage
5. The property is pledged as security - or collateral - but the borrower does not actually give up legal title or possession
hypothecation
power-of-sale provision
FHA annual mortgage premium and cancellation
VA loan features
6. 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
correspondent lender
VA loan features
subordination clause specifications
retail lender
7. 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
statutory right of redemption
Federal Open Market Committee
grantor (trustor)
FHA acceptable seller contribution
8. 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
due-on-sale (alienation) clause
private mortgage insurance payment stoppage
mortgagor
prime rates
9. 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
hard money loan
FHA annual mortgage premium and cancellation
Federal Open Market Committee
table funding
10. The lender receiving the trust deed
wholesale lender
equitable title
beneficiary
FHA 203b
11. Allows a borrower experiencing temporary financial difficulty to delay his monthly mortgage payments for a short period of time
Federal Open Market Committee
forbearance
FHA upfront mortgage premium
hypothecation
12. To collect the loan payments from the borrower
statutory right of redemption
service (a loan)
correspondent lender
USDA loan features
13. 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
level payment mortgage
power-of-sale provision
mortgagor
VA loan features
14. A loan that has priority over all other unsatisfied mortgages secured by the same property
Construction financing
loan originator
loan level price adjustment
primary (first) mortgage
15. A third-party lender provides actual funds for the loan
statutory right of redemption
portfolio lender
forbearance
hard money loan
16. The lender
defeasance clause
mortgagee
conveyance
budget (PITI) mortgage
17. 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
Federal Open Market Committee
Home Equity Conversion Mortgage
soft money loan
correspondent lender
18. A lender (e.g. - a bank - savings bank - credit union or mortgage lender) that interacts directly with the borrower and actually makes the loan
budget (PITI) mortgage
equitable right of redemption
retail lender
prime rates
19. A lender that holds - rather than sells - its loans
due-on-sale (alienation) clause
Federal Open Market Committee
portfolio lender
loan level price adjustment
20. 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
Fed actions against inflation
secondary mortgage market
equitable right of redemption
private mortgage insurance payment stoppage
21. 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
portfolio lender
soft money loan
right of reinstatement
level payment mortgage
22. 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
correspondent lender
retail lender
hypothecation
Home Equity Conversion Mortgage
23. A fee charged to lenders to compensate for certain loan features that increase the risk
Federal Open Market Committee
right of reinstatement
USDA loan applicant requirements
loan level price adjustment
24. 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
FHA 203b
conveyance
subordination clause specifications
wholesale lender
25. 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
equitable right of redemption
grantor (trustor)
promissory note information
FHA annual mortgage premium and cancellation
26. 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
Federal Open Market Committee
subordination clause specifications
soft money loan
loan originator
27. 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
budget (PITI) mortgage
primary (first) mortgage
loan level price adjustment
28. A mortgage investor that prices and funds loans applied for through mortgage brokers
statutory right of redemption
FHA acceptable seller contribution
grantor (trustor)
wholesale lender
29. The lowest rates a lender charges for its best customers
beneficiary
primary (first) mortgage
prime rates
retail lender
30. 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
promissory note information
Fed actions against inflation
conforming conventional loan requirements
correspondent lender
31. For most mortgages the premium is 2.25% of the loan amount - payable at closing or added to the loan amount and financed - nonrefundable
FHA upfront mortgage premium
Home Equity Conversion Mortgage
forbearance
retail lender
32. An immediate relative - a labor union or employer - a government agency or public entity - a nonprofit charitable organization
due-on-sale (alienation) clause
Acceptable gift suppliers
forbearance
secondary mortgage market
33. The buyer is entitled to a deed conveying the legal title when the contract is fully paid and performed
hypothecation
defeasance clause
Federal Open Market Committee
equitable title
34. 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
forbearance
Home Equity Conversion Mortgage
promissory note information
retail lender
35. 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
due-on-sale (alienation) clause
budget (PITI) mortgage
service (a loan)
loan originator
36. Decides when the Fed will either buy government securities or sell them.
Federal Open Market Committee
FHA acceptable seller contribution
FHA 203b
correspondent lender
37. 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
Federal Open Market Committee
USDA loan applicant requirements
primary (first) mortgage
beneficiary
38. 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
USDA loan features
soft money loan
Construction financing
correspondent lender
39. Takes or receives mortgage applications - assembles information - and prepares the paperwork and documentation necessary for obtaining a mortgage loan
beneficiary
loan originator
statutory right of redemption
level payment mortgage
40. The one who gives the mortgage; i.e. - the borrower or debtor
mortgagor
table funding
primary (first) mortgage
beneficiary
41. When the loan is paid down to 78% or 80% of the value of the property at the time the loan was taken
private mortgage insurance payment stoppage
due-on-sale (alienation) clause
grantor (trustor)
conveyance
42. The seller finances the purchase and does not actually give the buyer any cash
soft money loan
loan originator
Fed actions against inflation
mortgagor
43. 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
table funding
FHA annual mortgage premium and cancellation
USDA loan features
hard money loan
44. Act of transferring property title from one person to another
Construction financing
conforming conventional loan requirements
service (a loan)
conveyance
45. Provides for release of the lien when the borrower pays off the debt
equitable title
Home Equity Conversion Mortgage
defeasance clause
portfolio lender
46. A third party with a power of sale allowing him to foreclose without going to court
trustee
FHA annual mortgage premium and cancellation
USDA loan applicant requirements
table funding