Practice Exam Sales License

A  Homeowner Affordability and Stability Plan

B  Taxpayer Relief Act of 1997

C  American Taxpayer Relief Act of 2012

D  Mortgage Forgiveness Debt Relief Act of 2007

A  Four goals

B  Three data collection systems

C  Six regional citizen-led initiatives

D  12 departments

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

B  Supervises national banks and financial institutions.

C  Investigates financial crimes including tax evaders.

D  Produces currency and coins.

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

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

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

A  Buy and hold

B  Wholesaling

C  Fix and flip

D  Passive

A  Reinstatement

B  Deficiency judgment

C  Loan modification

D  Deed in lieu of foreclosure

A  Department of Homeland Security

B  Department of the Interior

C  Department of Housing and Urban Development

D  Agency for Housing and Inclusive Communities

A  Individuals, such as family members

B  Local small businesses

C  Credit unions

D  Employers

A  Community-managed lenders

B  Start-up business borrowers

C  Low-income urban borrowers

D  Non-profit businesses

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 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  Yes, in certain low-income areas

B  Yes, in certain high-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  Commissions

B  Listings

C  Buyers

D  Leads

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

B  The IRS must be notified

C  A Notice of Sale must be recorded

D  The reinstatement period must expire

A  Decrease

B  Remain the same

C  Increase

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

A  External obsolescence

B  Physical depreciation

C  Depreciation

D  Functional obsolescence

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

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

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

D  Member banks must lend more money to the public.

A  Banks focus lending offerings on local businesses and residents.

B  They’re purchased by secondary mortgage markets.

C  They’re funded by private investors.

D  They’re regulated by federal the government.

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

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

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

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

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

C  Payments must have been received for at least two years, and must be expected to continue for at least two 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  For $100

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

D  With an interest-only loan and no down payment

A  Alienation

B  Reconveyance

C  Power of sale

D  Acceleration

A  Double dipping

B  Subagency

C  Undisclosed dual agency

D  Cooperating brokerage

A  RAM

B  PMM

C  Home equity

D  HELOC

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 be in direct competition with conventional lenders

C  To meet the provisions of the Farm Loanership Act

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

A  Title companies

B  General contractors

C  Appraisers

D  Lenders

A  Redemption

B  Eviction

C  Short sale

D  Deed in lieu of foreclosure

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

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

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

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

A  Petition for immediate repossession and eviction

B  Petition to enter, repossession, notice of 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 increase their equity

B  To get a lower interest rate

C  To change mortgage brokers

D  To change the bank that owns their loan

A  $210,000, the sales price

B  The lender’s guaranteed maximum

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

D  $215,000, the CRV

A  The Federal Reserve

B  U.S. Treasury

C  Bureau of Engraving and Printing

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

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

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

A  Type of ownership

B  Construction material

C  Location

D  Year built

A  7%

B  5%

C  6%

D  4%

A  It’s never more than 10 years.

B  The draw period varies.

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

D  It’s always at least five years.

A  $2,500

B  $4,000

C  $3,600

D  $3,000

A  Equity-based

B  Multi-modal

C  Participation

D  Interim

A  Savings account

B  Car loan

C  Mortgage

D  Credit card balance

A  60

B  30

C  180

D  45

A  Page four

B  Page three

C  Page two

D  Page one

A  Fewer jobs

B  Future cash income

C  Loss of cash flow

D  Guaranteed income

A  Dedication by deed

B  Full covenant and warranty deed

C  By a deed of gift

D  Through a referee’s deed

A  Prepayment penalty

B  Subordination

C  Lock-in

D  Late charge

A  Term

B  Tariff

C  Territory

D  Taxes

A  Underwriting fee

B  Application fee

C  Agent’s commission

D  Origination fee

A  A redemption

B  An eviction procedure

C  A type of foreclosure

D  A type of financing

A  Payment debt

B  Loan-to-value ratio

C  Housing ratio

D  Total debt

A  Convertible feature

B  Lower initial interest rate

C  Balloon payment

D  Initial cap

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

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

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

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

A  Residual income and debt-to-income

B  CRV and seller concessions

C  Housing ratio and total debt obligation

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

B  Scheduling the loan closing

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

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

C  It raises interest rates incrementally over time.

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

A  An increase in property value

B  A refinancing strategy

C  Paying off of a loan over time

D  A decrease in property value

A  Home Mortgage Discrimination Act

B  Community Reinvestment Act

C  Equal Credit Opportunity Act

D  Consumer Credit Protection Act

A  Trustee’s deed

B  Notice of sale

C  Deed of trust

D  Foreclosure deed

A  Five years in prison

B  Ten years in prison

C  Two years in prison

D  One year in prison

A  Renegotiable rate

B  Fixed rate

C  Adjustable rate

D  Graduated payment

A  Note with mortgage

B  Last will and testament

C  Contract for deed

D  Note with deed of trust

A  Co-pays

B  Coverage limits

C  Covered events

D  Co-insurance

A  Title I

B  Title II, Section 251

C  Title II, Section 234(c)

D  Title II, Section 203(n)

A  Extra money paid to cover any unexpected bank fees

B  Random charges

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

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

A  $276,596

B  $250,000

C  $650,000

D  $265,957

A  California Foreclosure Reduction Act

B  Real Estate License Law

C  Mortgage Foreclosure Consultant Law

D  SAFE Act

A  Income tax account

B  Retirement account

C  Business checking account

D  Emergency fund

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

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

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

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

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

D  Yes

A  82%

B  96%

C  72%

D  75%

A  Special benefits

B  A certificate of appreciation

C  Interest

D  Five times their investment in return

A  Seller

B  Lender

C  Buyer

D  Settlement agent

A  Conventional loan

B  Mobile home loan

C  Construction loan

D  Personal loan

A  Recovery

B  Expansion

C  Recession

D  Over supply

A  Stock

B  Note

C  Bond

D  Bill

A  Ignore it.

B  Run a background check on it.

C  Verify it.

D  Trust it.

A  The lender can sue Jasmine.

B  Jasmine can’t occupy the residence.

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  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 lender may charge a fee to the new borrower.

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

A  Federal funds rate

B  Reserve requirements

C  Open-market operations

D  Discount window

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

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

C  The rate at which borrowers can refinance their mortgages

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

A  GRM

B  Value in situ

C  Cap rate

D  Replacement value

A  Bridge loan

B  Wrap-around mortgage

C  Fixed rate loan

D  Amortized loan

A  Deed in lieu of foreclosure

B  Short sale

C  Deficiency judgment

D  Non-judicial foreclosure

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

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

C  Service the client’s loan.

D  Take the client’s residential mortgage loan application.

A  Once the borrower has 20% or more equity.

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

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

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

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

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

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  Property lot size

C  Population size

D  Employment figures

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

B  Prohibits the borrower from suing the lender for mortgage fraud

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

B  Because California is a title theory state.

C  Because California laws don’t allow judicial foreclosure.

D  Because California is a lien theory state.

A  12

B  8

C  15

D  10

A  With a maturity term between two and 10 years

B  With a maturity term of one year or less

C  Without a specified maturity term

D  With a maturity term of 30 years

A  Partnership between mortgagors

B  Partnership between mortgagees and mortgagors

C  Limited liability partnership

D  Partnership between mortgagees

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

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

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

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

A  $300,000

B  $30,000

C  $15,000

D  $60,000

A  29 years

B  40 years

C  27.5 years

D  39 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  No; commercial and business loans are exempt from RESPA requirements.

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

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

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

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

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