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Mortgage Lending Industry

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. 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






2. To collect the loan payments from the borrower






3. Allows a borrower experiencing temporary financial difficulty to delay his monthly mortgage payments for a short period of time






4. When the loan is paid down to 78% or 80% of the value of the property at the time the loan was taken






5. 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






6. 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






7. 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






8. 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






9. For most mortgages the premium is 2.25% of the loan amount - payable at closing or added to the loan amount and financed - nonrefundable






10. A lender that holds - rather than sells - its loans






11. The seller finances the purchase and does not actually give the buyer any cash






12. Takes or receives mortgage applications - assembles information - and prepares the paperwork and documentation necessary for obtaining a mortgage loan






13. 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






14. Provides for release of the lien when the borrower pays off the debt






15. A loan that has priority over all other unsatisfied mortgages secured by the same property






16. 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






17. 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






18. 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






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






20. Where mortgages may be sold individually or bundled with other mortgages with similar features into mortgage-backed securities and sold on the equity market






21. A third party with a power of sale allowing him to foreclose without going to court






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






23. 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






24. 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






25. Act of transferring property title from one person to another






26. The borrower giving a trust deed to the lender






27. An immediate relative - a labor union or employer - a government agency or public entity - a nonprofit charitable organization






28. The one who gives the mortgage; i.e. - the borrower or debtor






29. Total monthly payment doesn't change but the rate applied to principal and interest changes






30. The property is pledged as security - or collateral - but the borrower does not actually give up legal title or possession






31. 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






32. Decides when the Fed will either buy government securities or sell them.






33. A mortgage investor that prices and funds loans applied for through mortgage brokers






34. 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






35. A fee charged to lenders to compensate for certain loan features that increase the risk






36. 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






37. 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






38. The buyer is entitled to a deed conveying the legal title when the contract is fully paid and performed






39. 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






40. The lender






41. 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






42. 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






43. The lowest rates a lender charges for its best customers






44. A third-party lender provides actual funds for the loan






45. The lender receiving the trust deed






46. 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






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