Practice Exam Sales License

A  Mortgage Forgiveness Debt Relief Act of 2007

B  Homeowner Affordability and Stability Plan

C  American Taxpayer Relief Act of 2012

D  Taxpayer Relief Act of 1997

A  Three data collection systems

B  Four goals

C  Six regional citizen-led initiatives

D  12 departments

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 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 risk.

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, and has differing balances, maturities, and risks.

A  Fix and flip

B  Wholesaling

C  Passive

D  Buy and hold

A  Loan modification

B  Reinstatement

C  Deed in lieu of foreclosure

D  Deficiency judgment

A  Agency for Housing and Inclusive Communities

B  Department of Homeland Security

C  Department of the Interior

D  Department of Housing and Urban Development

A  Credit unions

B  Individuals, such as family members

C  Employers

D  Local small businesses

A  Low-income urban borrowers

B  Non-profit businesses

C  Start-up business borrowers

D  Community-managed lenders

A  $241,715.88

B  $241,976.21

C  $241,672.12

D  $240,682.34

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 or lender may loan money to its most creditworthy borrowers

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

A  Yes, for Native Americans on trust lands

B  No

C  Yes, in certain low-income areas

D  Yes, in certain high-income areas

A  Yes

B  No

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

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

A  Leads

B  Buyers

C  Commissions

D  Listings

A  The reinstatement period must expire

B  The IRS must be notified

C  A Notice of Sale must be recorded

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

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

B  Remain the same

C  Increase

D  Decrease

A  External obsolescence

B  Functional obsolescence

C  Depreciation

D  Physical depreciation

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

B  Member banks must lend more money to the public.

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 funded by private investors.

B  Banks focus lending offerings on local businesses and residents.

C  They’re regulated by federal the government.

D  They’re purchased by secondary mortgage markets.

A  VA

B  FHA, VA, or conventional

C  FHA

D  Conventional

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

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

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

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

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 two years, and must be expected to continue for at least two more years.

A  For a 10% discount off list price

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 $100

A  Power of sale

B  Acceleration

C  Alienation

D  Reconveyance

A  Cooperating brokerage

B  Double dipping

C  Subagency

D  Undisclosed dual agency

A  RAM

B  HELOC

C  PMM

D  Home equity

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

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  To meet the provisions of the Farm Loanership Act

D  To be in direct competition with conventional lenders

A  Title companies

B  Appraisers

C  Lenders

D  General contractors

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 to enter, repossession, notice of eviction

B  Petition for immediate repossession and eviction

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

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

A  To get a lower interest rate

B  To change the bank that owns their loan

C  To increase their equity

D  To change mortgage brokers

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

B  $215,000, the CRV

C  The lender’s guaranteed maximum

D  $210,000, the sales price

A  Bureau of Engraving and Printing

B  U.S. Treasury

C  The Federal Reserve

D  U.S. Mint

A  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.

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

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

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

A  Location

B  Construction material

C  Type of ownership

D  Year built

A  4%

B  5%

C  6%

D  7%

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

B  The draw period varies.

C  It’s always at least five years.

D  It’s never more than 10 years.

A  $3,000

B  $4,000

C  $2,500

D  $3,600

A  Equity-based

B  Participation

C  Multi-modal

D  Interim

A  Car loan

B  Mortgage

C  Credit card balance

D  Savings account

A  180

B  45

C  30

D  60

A  Page four

B  Page two

C  Page three

D  Page one

A  Future cash income

B  Loss of cash flow

C  Fewer jobs

D  Guaranteed income

A  Full covenant and warranty deed

B  Through a referee’s deed

C  Dedication by deed

D  By a deed of gift

A  Prepayment penalty

B  Lock-in

C  Late charge

D  Subordination

A  Taxes

B  Tariff

C  Term

D  Territory

A  Agent’s commission

B  Application fee

C  Origination fee

D  Underwriting fee

A  A type of financing

B  A type of foreclosure

C  An eviction procedure

D  A redemption

A  Housing ratio

B  Loan-to-value ratio

C  Total debt

D  Payment debt

A  Lower initial interest rate

B  Convertible feature

C  Initial cap

D  Balloon payment

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 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  CRV and seller concessions

B  Housing ratio and total debt obligation

C  Residual income and debt-to-income

D  Debt and net operating income

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

B  Cash must be brought to closing

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

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

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

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

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

C  It raises interest rates incrementally over time.

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

A  A decrease in property value

B  An increase in property value

C  Paying off of a loan over time

D  A refinancing strategy

A  Equal Credit Opportunity Act

B  Community Reinvestment Act

C  Consumer Credit Protection Act

D  Home Mortgage Discrimination Act

A  Foreclosure deed

B  Notice of sale

C  Deed of trust

D  Trustee’s deed

A  Five years in prison

B  One year in prison

C  Ten years in prison

D  Two years in prison

A  Fixed rate

B  Renegotiable rate

C  Adjustable rate

D  Graduated payment

A  Contract for deed

B  Note with deed of trust

C  Note with mortgage

D  Last will and testament

A  Covered events

B  Co-pays

C  Coverage limits

D  Co-insurance

A  Title II, Section 234(c)

B  Title I

C  Title II, Section 203(n)

D  Title II, Section 251

A  Random charges

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

C  Extra money paid to cover any unexpected bank fees

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

A  $265,957

B  $650,000

C  $250,000

D  $276,596

A  Mortgage Foreclosure Consultant Law

B  California Foreclosure Reduction Act

C  SAFE Act

D  Real Estate License Law

A  Retirement account

B  Emergency fund

C  Business checking account

D  Income tax account

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

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

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 housing ratio requirement.

B  Yes

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

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

A  96%

B  82%

C  72%

D  75%

A  Special benefits

B  Five times their investment in return

C  Interest

D  A certificate of appreciation

A  Seller

B  Buyer

C  Settlement agent

D  Lender

A  Personal loan

B  Mobile home loan

C  Construction loan

D  Conventional loan

A  Recovery

B  Expansion

C  Recession

D  Over supply

A  Bill

B  Bond

C  Stock

D  Note

A  Run a background check on it.

B  Ignore it.

C  Verify it.

D  Trust it.

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

B  Jasmine can’t occupy the residence.

C  The lender can sue Jasmine.

D  Jasmine can’t pay off her loan early.

A  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.

B  Yes, she should have partial entitlement left.

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

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

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  The lender may charge a fee to the new borrower.

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

A  Reserve requirements

B  Federal funds rate

C  Open-market operations

D  Discount window

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 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 borrowers can refinance their mortgages

A  Replacement value

B  Cap rate

C  GRM

D  Value in situ

A  Amortized loan

B  Bridge loan

C  Fixed rate loan

D  Wrap-around mortgage

A  Deed in lieu of foreclosure

B  Non-judicial foreclosure

C  Short sale

D  Deficiency judgment

A  Service the client’s loan.

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

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

D  Take the client’s residential mortgage loan application.

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

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

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

D  Once the borrower has 20% or more equity.

A  Interest rates plummet.

B  Banks are restricted from making loans to consumers.

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

D  Banks don’t have access to additional funds.

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

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

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

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

A  Employment figures

B  Property lot size

C  Cost of living

D  Population size

A  Prohibits the borrower from suing the lender for mortgage fraud

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

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

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

A  Because California is a lien theory state.

B  Because California is a title 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 laws don’t allow judicial foreclosure.

A  10

B  15

C  8

D  12

A  With a maturity term of 30 years

B  Without a specified maturity term

C  With a maturity term between two and 10 years

D  With a maturity term of one year or less

A  Partnership between mortgagees and mortgagors

B  Partnership between mortgagors

C  Limited liability partnership

D  Partnership between mortgagees

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

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

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

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

A  $15,000

B  $300,000

C  $60,000

D  $30,000

A  40 years

B  39 years

C  29 years

D  27.5 years

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

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

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

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

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.