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