Practice Exam Sales License

A  Taxpayer Relief Act of 1997

B  Mortgage Forgiveness Debt Relief Act of 2007

C  Homeowner Affordability and Stability Plan

D  American Taxpayer Relief Act of 2012

A  12 departments

B  Six regional citizen-led initiatives

C  Three data collection systems

D  Four goals

A  Investigates financial crimes including tax evaders.

B  Supervises national banks and financial institutions.

C  Produces currency and coins.

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

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

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

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

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

A  Buy and hold

B  Fix and flip

C  Wholesaling

D  Passive

A  Reinstatement

B  Deficiency judgment

C  Loan modification

D  Deed in lieu of foreclosure

A  Department of Housing and Urban Development

B  Agency for Housing and Inclusive Communities

C  Department of Homeland Security

D  Department of the Interior

A  Credit unions

B  Local small businesses

C  Employers

D  Individuals, such as family members

A  Start-up business borrowers

B  Non-profit businesses

C  Community-managed lenders

D  Low-income urban borrowers

A  $241,715.88

B  $241,672.12

C  $240,682.34

D  $241,976.21

A  The rate at which borrowers can refinance their mortgages

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

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, for Native Americans on trust lands

B  No

C  Yes, in certain high-income areas

D  Yes, in certain low-income areas

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

B  No

C  Yes

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

A  Commissions

B  Leads

C  Buyers

D  Listings

A  The IRS must be notified

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

C  A Notice of Sale must be recorded

D  The reinstatement period must expire

A  Increase

B  Remain the same

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

D  Decrease

A  External obsolescence

B  Depreciation

C  Physical depreciation

D  Functional obsolescence

A  Member banks must lend more money to the public.

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

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

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

A  They’re regulated by federal the government.

B  They’re funded by private investors.

C  Banks focus lending offerings on local businesses and residents.

D  They’re purchased by secondary mortgage markets.

A  VA

B  Conventional

C  FHA, VA, or conventional

D  FHA

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

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

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

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

C  Payments must have been received for at least one year, 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 three more years.

A  With an interest-only loan and no down payment

B  For $100

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

D  For a 10% discount off list price

A  Reconveyance

B  Power of sale

C  Alienation

D  Acceleration

A  Undisclosed dual agency

B  Cooperating brokerage

C  Subagency

D  Double dipping

A  Home equity

B  HELOC

C  PMM

D  RAM

A  To be in direct competition with conventional lenders

B  To meet the provisions of the Farm Loanership Act

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

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

A  Lenders

B  Title companies

C  Appraisers

D  General contractors

A  Redemption

B  Deed in lieu of foreclosure

C  Eviction

D  Short sale

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

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

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

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

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

C  Petition for immediate repossession and eviction

D  Petition to enter, repossession, notice of eviction

A  To get a lower interest rate

B  To change mortgage brokers

C  To increase their equity

D  To change the bank that owns their loan

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

B  $215,000, the CRV

C  $210,000, the sales price

D  The lender’s guaranteed maximum

A  Bureau of Engraving and Printing

B  U.S. Mint

C  The Federal Reserve

D  U.S. Treasury

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

D  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.

A  Location

B  Year built

C  Construction material

D  Type of ownership

A  4%

B  6%

C  7%

D  5%

A  The draw period varies.

B  It’s always at least five years.

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

D  It’s never more than 10 years.

A  $4,000

B  $3,600

C  $3,000

D  $2,500

A  Participation

B  Multi-modal

C  Interim

D  Equity-based

A  Credit card balance

B  Savings account

C  Car loan

D  Mortgage

A  45

B  60

C  30

D  180

A  Page four

B  Page three

C  Page one

D  Page two

A  Guaranteed income

B  Future cash income

C  Loss of cash flow

D  Fewer jobs

A  Through a referee’s deed

B  Dedication by deed

C  Full covenant and warranty deed

D  By a deed of gift

A  Lock-in

B  Late charge

C  Subordination

D  Prepayment penalty

A  Term

B  Tariff

C  Territory

D  Taxes

A  Underwriting fee

B  Application fee

C  Agent’s commission

D  Origination fee

A  An eviction procedure

B  A type of foreclosure

C  A redemption

D  A type of financing

A  Payment debt

B  Housing ratio

C  Total debt

D  Loan-to-value ratio

A  Balloon payment

B  Convertible feature

C  Lower initial interest rate

D  Initial cap

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

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

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

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

A  Housing ratio and total debt obligation

B  CRV and seller concessions

C  Residual income and debt-to-income

D  Debt and net operating income

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

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

C  Cash must be brought to closing

D  Could have been saved by paying discount points

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

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

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

D  Scheduling the loan closing

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

B  It raises interest rates incrementally over time.

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

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

A  A decrease in property value

B  Paying off of a loan over time

C  An increase in property value

D  A refinancing strategy

A  Community Reinvestment Act

B  Home Mortgage Discrimination Act

C  Consumer Credit Protection Act

D  Equal Credit Opportunity Act

A  Trustee’s deed

B  Notice of sale

C  Foreclosure deed

D  Deed of trust

A  Five years in prison

B  One year in prison

C  Ten years in prison

D  Two years in prison

A  Adjustable rate

B  Fixed rate

C  Renegotiable rate

D  Graduated payment

A  Last will and testament

B  Note with deed of trust

C  Contract for deed

D  Note with mortgage

A  Co-pays

B  Coverage limits

C  Covered events

D  Co-insurance

A  Title I

B  Title II, Section 234(c)

C  Title II, Section 251

D  Title II, Section 203(n)

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

B  Extra money paid to cover any unexpected bank fees

C  Random charges

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  $250,000

D  $650,000

A  SAFE Act

B  California Foreclosure Reduction Act

C  Mortgage Foreclosure Consultant Law

D  Real Estate License Law

A  Emergency fund

B  Business checking account

C  Income tax account

D  Retirement account

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

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

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

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

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

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

C  Yes

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

A  72%

B  75%

C  82%

D  96%

A  Special benefits

B  Interest

C  A certificate of appreciation

D  Five times their investment in return

A  Seller

B  Settlement agent

C  Buyer

D  Lender

A  Mobile home loan

B  Construction loan

C  Personal loan

D  Conventional loan

A  Expansion

B  Over supply

C  Recovery

D  Recession

A  Bill

B  Stock

C  Bond

D  Note

A  Run a background check on it.

B  Ignore it.

C  Trust it.

D  Verify it.

A  Jasmine can’t pay off her loan early.

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

C  Jasmine can’t occupy the residence.

D  The lender can sue Jasmine.

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

B  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.

C  Yes, she should have partial entitlement left.

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

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

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

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

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

A  Open-market operations

B  Discount window

C  Reserve requirements

D  Federal funds rate

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

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

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

D  The rate at which borrowers can refinance their mortgages

A  Value in situ

B  Cap rate

C  GRM

D  Replacement value

A  Wrap-around mortgage

B  Fixed rate loan

C  Amortized loan

D  Bridge loan

A  Deficiency judgment

B  Non-judicial foreclosure

C  Deed in lieu of foreclosure

D  Short sale

A  Take the client’s residential mortgage loan application.

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

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

D  Service the client’s 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  Banks don’t have access to additional funds.

B  Banks are restricted from making loans to consumers.

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

D  Interest rates plummet.

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

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

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

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

A  Cost of living

B  Population size

C  Property lot size

D  Employment figures

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

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

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 lien theory state.

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

D  Because California is a title theory state.

A  15

B  8

C  12

D  10

A  With a maturity term of 30 years

B  With a maturity term between two and 10 years

C  With a maturity term of one year or less

D  Without a specified maturity term

A  Partnership between mortgagees

B  Partnership between mortgagees and mortgagors

C  Partnership between mortgagors

D  Limited liability partnership

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

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

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

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

A  $15,000

B  $300,000

C  $30,000

D  $60,000

A  27.5 years

B  39 years

C  40 years

D  29 years

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

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

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

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

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

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