Practice Exam Sales License

A  Homeowner Affordability and Stability Plan

B  Taxpayer Relief Act of 1997

C  Mortgage Forgiveness Debt Relief Act of 2007

D  American Taxpayer Relief Act of 2012

A  Six regional citizen-led initiatives

B  12 departments

C  Four goals

D  Three data collection systems

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, and has differing balances, maturities, and risks.

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

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  Passive

B  Buy and hold

C  Fix and flip

D  Wholesaling

A  Deed in lieu of foreclosure

B  Reinstatement

C  Deficiency judgment

D  Loan modification

A  Department of Housing and Urban Development

B  Agency for Housing and Inclusive Communities

C  Department of the Interior

D  Department of Homeland Security

A  Employers

B  Credit unions

C  Local small businesses

D  Individuals, such as family members

A  Low-income urban borrowers

B  Community-managed lenders

C  Non-profit businesses

D  Start-up business borrowers

A  $241,672.12

B  $240,682.34

C  $241,976.21

D  $241,715.88

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 its Federal Reserve bank when using commercial paper as collateral

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

A  Yes, in certain high-income areas

B  Yes, in certain low-income areas

C  Yes, for Native Americans on trust lands

D  No

A  No

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

C  Yes

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

A  Leads

B  Buyers

C  Commissions

D  Listings

A  A Notice of Sale must be recorded

B  The IRS must be notified

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

D  The reinstatement period must expire

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

B  Increase

C  Remain the same

D  Decrease

A  Functional obsolescence

B  External obsolescence

C  Physical depreciation

D  Depreciation

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  They’re purchased by secondary mortgage markets.

B  They’re funded by private investors.

C  Banks focus lending offerings on local businesses and residents.

D  They’re regulated by federal the government.

A  FHA

B  FHA, VA, or conventional

C  Conventional

D  VA

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

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

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

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 three more years.

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 three years, and must be expected to continue for at least one more year.

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

A  For $100

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

C  With an interest-only loan and no down payment

D  For a 10% discount off list price

A  Reconveyance

B  Power of sale

C  Alienation

D  Acceleration

A  Cooperating brokerage

B  Undisclosed dual agency

C  Double dipping

D  Subagency

A  PMM

B  Home equity

C  HELOC

D  RAM

A  To be in direct competition with conventional lenders

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

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

D  To meet the provisions of the Farm Loanership Act

A  General contractors

B  Title companies

C  Appraisers

D  Lenders

A  Deed in lieu of foreclosure

B  Short sale

C  Eviction

D  Redemption

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

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

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

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

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

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

C  Petition to enter, repossession, notice of eviction

D  Petition for immediate repossession and eviction

A  To change the bank that owns their loan

B  To increase their equity

C  To get a lower interest rate

D  To change mortgage brokers

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

B  The lender’s guaranteed maximum

C  $215,000, the CRV

D  $210,000, the sales price

A  U.S. Treasury

B  U.S. Mint

C  Bureau of Engraving and Printing

D  The Federal Reserve

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

B  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.

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

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

A  Location

B  Type of ownership

C  Construction material

D  Year built

A  4%

B  6%

C  5%

D  7%

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

B  It’s never more than 10 years.

C  The draw period varies.

D  It’s always at least five years.

A  $4,000

B  $2,500

C  $3,600

D  $3,000

A  Equity-based

B  Participation

C  Multi-modal

D  Interim

A  Car loan

B  Mortgage

C  Savings account

D  Credit card balance

A  60

B  30

C  180

D  45

A  Page three

B  Page two

C  Page one

D  Page four

A  Guaranteed income

B  Future cash income

C  Loss of cash flow

D  Fewer jobs

A  Full covenant and warranty deed

B  By a deed of gift

C  Through a referee’s deed

D  Dedication by deed

A  Lock-in

B  Late charge

C  Prepayment penalty

D  Subordination

A  Term

B  Taxes

C  Territory

D  Tariff

A  Origination fee

B  Underwriting fee

C  Agent’s commission

D  Application fee

A  A type of financing

B  An eviction procedure

C  A type of foreclosure

D  A redemption

A  Total debt

B  Payment debt

C  Loan-to-value ratio

D  Housing ratio

A  Lower initial interest rate

B  Convertible feature

C  Balloon payment

D  Initial cap

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

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

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

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

A  Housing ratio and total debt obligation

B  Residual income and debt-to-income

C  Debt and net operating income

D  CRV and seller concessions

A  Could have been saved by paying discount points

B  Cash must be brought to closing

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

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

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

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

C  Scheduling the loan closing

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

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

B  It raises interest rates incrementally over time.

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

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

A  An increase in property value

B  Paying off of a loan over time

C  A decrease in property value

D  A refinancing strategy

A  Consumer Credit Protection Act

B  Community Reinvestment Act

C  Home Mortgage Discrimination Act

D  Equal Credit Opportunity Act

A  Notice of sale

B  Foreclosure deed

C  Deed of trust

D  Trustee’s deed

A  Ten years in prison

B  One year in prison

C  Five years in prison

D  Two years in prison

A  Graduated payment

B  Renegotiable rate

C  Fixed rate

D  Adjustable rate

A  Last will and testament

B  Note with deed of trust

C  Note with mortgage

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 203(n)

C  Title II, Section 251

D  Title I

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

B  Random charges

C  Extra money paid to cover any unexpected bank fees

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

A  $650,000

B  $250,000

C  $265,957

D  $276,596

A  SAFE Act

B  Real Estate License Law

C  Mortgage Foreclosure Consultant Law

D  California Foreclosure Reduction Act

A  Business checking account

B  Retirement account

C  Emergency fund

D  Income tax account

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

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

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

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

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

B  Yes

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

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

A  96%

B  75%

C  82%

D  72%

A  A certificate of appreciation

B  Special benefits

C  Five times their investment in return

D  Interest

A  Lender

B  Buyer

C  Seller

D  Settlement agent

A  Conventional loan

B  Mobile home loan

C  Construction loan

D  Personal loan

A  Recovery

B  Over supply

C  Recession

D  Expansion

A  Bond

B  Note

C  Bill

D  Stock

A  Ignore it.

B  Verify it.

C  Run a background check on it.

D  Trust it.

A  The lender can sue Jasmine.

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

C  Jasmine can’t pay off her loan early.

D  Jasmine can’t occupy the residence.

A  Yes, she should have partial entitlement left.

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

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  Discount window

B  Open-market operations

C  Federal funds rate

D  Reserve requirements

A  The rate at which borrowers can refinance their mortgages

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 a bank or lender may loan money to its most creditworthy borrowers

A  GRM

B  Cap rate

C  Value in situ

D  Replacement value

A  Amortized loan

B  Bridge loan

C  Wrap-around mortgage

D  Fixed rate loan

A  Deed in lieu of foreclosure

B  Non-judicial foreclosure

C  Short sale

D  Deficiency judgment

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

B  Take the client’s residential mortgage loan application.

C  Service the client’s loan.

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

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

B  Once the borrower has 20% or more equity.

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

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

A  Banks are restricted from making loans to consumers.

B  Banks don’t have access to additional funds.

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

D  Interest rates plummet.

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

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

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

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

A  Employment figures

B  Cost of living

C  Population size

D  Property lot size

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  12

B  8

C  15

D  10

A  With a maturity term between two and 10 years

B  Without a specified maturity term

C  With a maturity term of one year or less

D  With a maturity term of 30 years

A  Partnership between mortgagees

B  Partnership between mortgagees and mortgagors

C  Partnership between mortgagors

D  Limited liability partnership

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

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

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

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

A  $300,000

B  $60,000

C  $15,000

D  $30,000

A  39 years

B  29 years

C  27.5 years

D  40 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 continue to buy presents because he values doing so, but can buy less expensive items.

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

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

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