Practice Exam Sales License

A  American Taxpayer Relief Act of 2012

B  Homeowner Affordability and Stability Plan

C  Mortgage Forgiveness Debt Relief Act of 2007

D  Taxpayer Relief Act of 1997

A  Three data collection systems

B  Six regional citizen-led initiatives

C  12 departments

D  Four goals

A  Investigates financial crimes including tax evaders.

B  Produces currency and coins.

C  Pays bills owed by the U.S. government.

D  Supervises national banks and financial institutions.

A  Each tranche has specific rules for distributing income received from the collateral, but is organized so that each tranche has a similar maturity.

B  Each tranche distributes income in the same way and to the same investors.

C  Each tranche has specific rules for distributing income received from the collateral, but is organized so that each tranche has a similar risk.

D  Each tranche has specific rules for distributing income received from the collateral, and has differing balances, maturities, and risks.

A  Fix and flip

B  Buy and hold

C  Wholesaling

D  Passive

A  Deficiency judgment

B  Loan modification

C  Reinstatement

D  Deed in lieu of foreclosure

A  Department of Homeland Security

B  Department of Housing and Urban Development

C  Department of the Interior

D  Agency for Housing and Inclusive Communities

A  Individuals, such as family members

B  Employers

C  Local small businesses

D  Credit unions

A  Non-profit businesses

B  Start-up business borrowers

C  Low-income urban borrowers

D  Community-managed lenders

A  $240,682.34

B  $241,715.88

C  $241,976.21

D  $241,672.12

A  The rate at which a bank or lender may loan money to its most creditworthy borrowers

B  The rate at which borrowers can refinance their mortgages

C  The rate at which a bank can obtain a loan from another bank

D  The rate at which a bank can obtain a loan from its Federal Reserve bank when using commercial paper as collateral

A  Yes, in certain low-income areas

B  Yes, in certain high-income areas

C  Yes, for Native Americans on trust lands

D  No

A  It depends on the terms of the loan, not the VA

B  Yes, but Yancey may petition the VA to request removal of the pre-payment penalty

C  No

D  Yes

A  Listings

B  Buyers

C  Commissions

D  Leads

A  The reinstatement period must expire

B  A Notice of Sale must be recorded

C  The IRS must be notified

D  The mortgage service must notify the borrower of their delinquency and foreclosure alternatives

A  Increase

B  Remain the same

C  Decrease

D  Historically, property values have not followed a consistent pattern.

A  Depreciation

B  External obsolescence

C  Physical depreciation

D  Functional obsolescence

A  Member banks must increase interest rates on loans they make.

B  Member banks must lend more money to the public.

C  Member banks must keep more assets on deposit at the reserve bank.

D  Member banks can keep fewer assets on deposit at the reserve bank.

A  Banks focus lending offerings on local businesses and residents.

B  They’re purchased by secondary mortgage markets.

C  They’re regulated by federal the government.

D  They’re funded by private investors.

A  VA

B  FHA

C  Conventional

D  FHA, VA, or conventional

A  Regardless of how it sounds, the lender still has to go to court.

B  It’s an outdated process that’s no longer used.

C  It may be used if the deed of trust includes a power-of-sale clause.

D  It’s the same as the judicial process, just called by a different name in different states.

A  Payments must have been received for at least two years, and must be expected to continue for at least two more years.

B  Payments must have been received for at least one year, and must be expected to continue for at least three more years.

C  Payments must have been received for at least three years, and must be expected to continue for at least three more years.

D  Payments must have been received for at least three years, and must be expected to continue for at least one more year.

A  For a 10% discount off list price

B  With an interest-only loan and no down payment

C  For a 50% discount off list price and a down payment of only $100

D  For $100

A  Alienation

B  Acceleration

C  Power of sale

D  Reconveyance

A  Undisclosed dual agency

B  Double dipping

C  Cooperating brokerage

D  Subagency

A  RAM

B  HELOC

C  PMM

D  Home equity

A  To ensure that credit is available to agricultural producers, who often can’t meet conventional underwriting standards due to the nature of their work

B  To meet the provisions of the Farm Loanership Act

C  To be in direct competition with conventional lenders

D  Because the Constitution requires the federal government to support agriculture in specific ways, such as agricultural lending

A  Lenders

B  General contractors

C  Title companies

D  Appraisers

A  Redemption

B  Deed in lieu of foreclosure

C  Eviction

D  Short sale

A  It shelters the borrower’s future properties from bankruptcy to protect the lender’s interests.

B  It gives the lender the ability to place liens against any property it chooses, including cars and boats.

C  It gives lenders the ability to recover losses due to a foreclosure sale from any current or future property the borrower owns.

D  It allows the lender to place a lien against all current and future personal tax refunds of the borrower who defaulted.

A  Petition for immediate repossession and eviction

B  Notification of pending auction, public auction, notice of eviction

C  Petition to enter, repossession, notice of eviction

D  Petition for legal ownership, opportunity to redeem property, notice of eviction if property is not redeemed

A  To change the bank that owns their loan

B  To change mortgage brokers

C  To get a lower interest rate

D  To increase their equity

A  $215,000, the CRV

B  $212,500 (an average of the two numbers)

C  The lender’s guaranteed maximum

D  $210,000, the sales price

A  U.S. Treasury

B  Bureau of Engraving and Printing

C  U.S. Mint

D  The Federal Reserve

A  Glen can recommend filing a complaint with HUD about the alleged discrimination.

B  Glen can assure his client that he will find a less bigoted seller in the same complex.

C  Glen can recommend that he and his client plan a retaliatory response to the seller’s discriminatory action to make all buyers avoid the condo.

D  Glen can ask his client if he’s eligible for FHA financing, which might change the seller’s mind.

A  Construction material

B  Type of ownership

C  Location

D  Year built

A  4%

B  7%

C  6%

D  5%

A  It’s never more than 10 years.

B  There really isn’t a draw period to speak of.

C  It’s always at least five years.

D  The draw period varies.

A  $3,600

B  $2,500

C  $3,000

D  $4,000

A  Interim

B  Multi-modal

C  Participation

D  Equity-based

A  Mortgage

B  Car loan

C  Savings account

D  Credit card balance

A  30

B  60

C  180

D  45

A  Page four

B  Page three

C  Page one

D  Page two

A  Fewer jobs

B  Guaranteed income

C  Loss of cash flow

D  Future cash income

A  Full covenant and warranty deed

B  Dedication by deed

C  Through a referee’s deed

D  By a deed of gift

A  Prepayment penalty

B  Subordination

C  Lock-in

D  Late charge

A  Taxes

B  Tariff

C  Territory

D  Term

A  Application fee

B  Underwriting fee

C  Origination fee

D  Agent’s commission

A  A type of financing

B  A type of foreclosure

C  An eviction procedure

D  A redemption

A  Housing ratio

B  Total debt

C  Loan-to-value ratio

D  Payment debt

A  Lower initial interest rate

B  Convertible feature

C  Initial cap

D  Balloon payment

A  To require institutional lenders to allow a buyer to assume a loan from a seller

B  To prohibit usurious loan terms in a privately funded real estate transaction

C  To ensure that all parties are educated about loan terms and about who will be compensated for arranging credit

D  To modify the timing of TILA and RESPA disclosures in a seller carry-back transaction

A  Housing ratio and total debt obligation

B  Debt and net operating income

C  Residual income and debt-to-income

D  CRV and seller concessions

A  Cash must be brought to closing

B  The loan costs, including total payments, finance charge, and TIP

C  Could have been saved by paying discount points

D  The borrower and the seller each pay or receive at closing

A  Scheduling the loan closing

B  Explaining the steps the consumer needs to take to obtain a loan offer

C  Informing a consumer of the loan rates that are publicly available

D  Presenting a revised loan offer to the consumer after they requested a lower rate

A  It removes a lien from a property when it’s been repaid.

B  It allows a junior mortgage to move into first lien position.

C  It allows the lien(s) ahead of the junior mortgage to be refinanced without changing their priority in lien positions.

D  It raises interest rates incrementally over time.

A  An increase in property value

B  Paying off of a loan over time

C  A refinancing strategy

D  A decrease in property value

A  Equal Credit Opportunity Act

B  Community Reinvestment Act

C  Consumer Credit Protection Act

D  Home Mortgage Discrimination Act

A  Trustee’s deed

B  Foreclosure deed

C  Deed of trust

D  Notice of sale

A  One year in prison

B  Ten years in prison

C  Five years in prison

D  Two years in prison

A  Graduated payment

B  Renegotiable rate

C  Adjustable rate

D  Fixed rate

A  Note with mortgage

B  Last will and testament

C  Note with deed of trust

D  Contract for deed

A  Co-insurance

B  Coverage limits

C  Co-pays

D  Covered events

A  Title II, Section 234(c)

B  Title II, Section 251

C  Title II, Section 203(n)

D  Title I

A  Random charges

B  Extra money paid to cover any unexpected bank fees

C  A fee paid to lenders for the use of their money

D  A fee to keep other borrowers from taking interest in your property and buying it out from under you

A  $276,596

B  $265,957

C  $650,000

D  $250,000

A  California Foreclosure Reduction Act

B  SAFE Act

C  Real Estate License Law

D  Mortgage Foreclosure Consultant Law

A  Retirement account

B  Emergency fund

C  Business checking account

D  Income tax account

A  The appraiser will weigh the value produced from each approach equally.

B  The appraiser may weigh only one approach more heavily than the others.

C  The appraiser may choose not to reconcile the three appraisal approaches.

D  The appraiser may weigh one or two approaches more heavily than the others, as appropriate for the property type.

A  No, she doesn’t meet the total debt obligation requirement.

B  No, she doesn’t meet the credit score requirement.

C  Yes

D  No, she doesn’t meet the housing ratio requirement.

A  82%

B  72%

C  75%

D  96%

A  Interest

B  A certificate of appreciation

C  Special benefits

D  Five times their investment in return

A  Settlement agent

B  Buyer

C  Lender

D  Seller

A  Conventional loan

B  Mobile home loan

C  Personal loan

D  Construction loan

A  Expansion

B  Recession

C  Over supply

D  Recovery

A  Bond

B  Bill

C  Note

D  Stock

A  Trust it.

B  Ignore it.

C  Run a background check on it.

D  Verify it.

A  Jasmine can’t occupy the residence.

B  The lender can sue Jasmine.

C  Jasmine can’t pay off her loan early.

D  The lender can put Jasmine’s loan in default.

A  No, she can’t obtain another VA loan until she has paid off the first loan entirely.

B  No, since she has already used her entitlement, she can’t get another VA loan.

C  Yes, she should have partial entitlement left.

D  Yes, but she must sell the first property and either pay off the loan or have the loan assumed by another veteran before using her VA loan entitlement again.

A  A novation can be used to remove the original borrower’s liability.

B  The seller’s credit score may improve although he’s not making any mortgage payments.

C  The lender may charge a fee to the new borrower.

D  The lender may require the new borrower to meet qualification standards.

A  Reserve requirements

B  Federal funds rate

C  Discount window

D  Open-market operations

A  The rate at which a bank or lender may loan money to its most creditworthy borrowers

B  The rate at which a bank can obtain a loan from its Federal Reserve bank when using commercial paper as collateral

C  The rate at which a bank can obtain a loan from another bank

D  The rate at which borrowers can refinance their mortgages

A  GRM

B  Replacement value

C  Cap rate

D  Value in situ

A  Wrap-around mortgage

B  Bridge loan

C  Amortized loan

D  Fixed rate loan

A  Non-judicial foreclosure

B  Deficiency judgment

C  Deed in lieu of foreclosure

D  Short sale

A  Take the client’s residential mortgage loan application.

B  Offer to negotiate the terms of the client’s loan application.

C  Service the client’s loan.

D  Offer to provide the client with a list of lenders they could consider working with to obtain the loan.

A  Once the borrower has 20% or more equity.

B  Once the loan-to-value ratio reaches 78% of the original value.

C  After the borrower has paid on the loan for five years.

D  Once the loan-to-value ratio reaches 80%.

A  Interest rates plummet.

B  Banks are restricted from making loans to consumers.

C  Banks don’t have access to additional funds.

D  Banks have access to additional funds through their district reserve bank.

A  An FHA loan is usually more attractive to borrowers who have lower credit scores and down payments.

B  An FHA loan is best for borrowers who have large down payments.

C  FHA loans have more stringent requirements than conventional loans do.

D  FHA loans are available to all borrowers, regardless of credit history.

A  Property lot size

B  Employment figures

C  Population size

D  Cost of living

A  Gives the borrower a recourse for exiting the loan when financial difficulties occur

B  Prohibits the lender from suing the borrower for damages if foreclosure occurs

C  Allows the lender to sue the borrower for damages if foreclosure occurs

D  Prohibits the borrower from suing the lender for mortgage fraud

A  Because California laws don’t allow judicial foreclosure.

B  Because California is a title theory state.

C  Because California is a lien theory state.

D  Because California foreclosure laws allow a statutory right of redemption of up to one year with a judicial foreclosure.

A  15

B  8

C  10

D  12

A  With a maturity term of 30 years

B  Without a specified maturity term

C  With a maturity term of one year or less

D  With a maturity term between two and 10 years

A  Partnership between mortgagors

B  Partnership between mortgagees

C  Limited liability partnership

D  Partnership between mortgagees and mortgagors

A  The lender is loaning on land, air, and a promise to build.

B  This might be used in the case of a furnished condominium.

C  It may be a first mortgage, a junior mortgage, or a junior wrap-around mortgage.

D  The funds are often used for home renovations or to fund a college education.

A  $15,000

B  $60,000

C  $300,000

D  $30,000

A  27.5 years

B  29 years

C  39 years

D  40 years

A  Yes; because she obtains the loan from a federally insured financial institution, the loan is subject to RESPA requirements.

B  Yes; all loans secured by real estate are subject to RESPA requirements.

C  No; RESPA only applies to loans obtained from private lenders.

D  No; commercial and business loans are exempt from RESPA requirements.

A  He should break up with Nancy, as she costs too much.

B  He should tell Nancy that he can’t afford to buy her presents anymore.

C  He should continue to buy presents because he values doing so, and not worry about how much he is spending.

D  He should continue to buy presents because he values doing so, but can buy less expensive items.