Practice Exam Sales License

A  Homeowner Affordability and Stability Plan

B  Mortgage Forgiveness Debt Relief Act of 2007

C  Taxpayer Relief Act of 1997

D  American Taxpayer Relief Act of 2012

A  Four goals

B  12 departments

C  Three data collection systems

D  Six regional citizen-led initiatives

A  Supervises national banks and financial institutions.

B  Produces currency and coins.

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

D  Investigates financial crimes including tax evaders.

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

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, but is organized so that each tranche has a similar maturity.

A  Wholesaling

B  Passive

C  Buy and hold

D  Fix and flip

A  Deed in lieu of foreclosure

B  Reinstatement

C  Loan modification

D  Deficiency judgment

A  Department of Housing and Urban Development

B  Department of the Interior

C  Agency for Housing and Inclusive Communities

D  Department of Homeland Security

A  Employers

B  Local small businesses

C  Credit unions

D  Individuals, such as family members

A  Non-profit businesses

B  Community-managed lenders

C  Low-income urban borrowers

D  Start-up business borrowers

A  $240,682.34

B  $241,715.88

C  $241,976.21

D  $241,672.12

A  The rate at which borrowers can refinance their mortgages

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 a bank can obtain a loan from its Federal Reserve bank when using commercial paper as collateral

A  No

B  Yes, in certain low-income areas

C  Yes, in certain high-income areas

D  Yes, for Native Americans on trust lands

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

B  No

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

D  Yes

A  Leads

B  Listings

C  Commissions

D  Buyers

A  The IRS must be notified

B  The reinstatement period must expire

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  Increase

C  Remain the same

D  Decrease

A  Physical depreciation

B  External obsolescence

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  They’re regulated by federal the government.

B  They’re purchased by secondary mortgage markets.

C  Banks focus lending offerings on local businesses and residents.

D  They’re funded by private investors.

A  FHA, VA, or conventional

B  Conventional

C  VA

D  FHA

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

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

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 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 one more year.

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

B  For a 10% discount off list price

C  With an interest-only loan and no down payment

D  For $100

A  Power of sale

B  Alienation

C  Reconveyance

D  Acceleration

A  Cooperating brokerage

B  Double dipping

C  Undisclosed dual agency

D  Subagency

A  RAM

B  Home equity

C  HELOC

D  PMM

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

B  To meet the provisions of the Farm Loanership Act

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

D  To be in direct competition with conventional lenders

A  Title companies

B  Appraisers

C  General contractors

D  Lenders

A  Redemption

B  Deed in lieu of foreclosure

C  Short sale

D  Eviction

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

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  Petition for immediate repossession and eviction

C  Petition to enter, repossession, notice of eviction

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

A  To increase their equity

B  To get a lower interest rate

C  To change the bank that owns their loan

D  To change mortgage brokers

A  $210,000, the sales price

B  The lender’s guaranteed maximum

C  $215,000, the CRV

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

A  The Federal Reserve

B  U.S. Mint

C  U.S. Treasury

D  Bureau of Engraving and Printing

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  Construction material

B  Year built

C  Type of ownership

D  Location

A  6%

B  4%

C  5%

D  7%

A  The draw period varies.

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

C  It’s always at least five years.

D  It’s never more than 10 years.

A  $2,500

B  $3,000

C  $4,000

D  $3,600

A  Interim

B  Participation

C  Equity-based

D  Multi-modal

A  Car loan

B  Credit card balance

C  Savings account

D  Mortgage

A  180

B  30

C  45

D  60

A  Page one

B  Page two

C  Page four

D  Page three

A  Guaranteed income

B  Loss of cash flow

C  Fewer jobs

D  Future cash income

A  By a deed of gift

B  Through a referee’s deed

C  Full covenant and warranty deed

D  Dedication by deed

A  Lock-in

B  Late charge

C  Subordination

D  Prepayment penalty

A  Taxes

B  Territory

C  Tariff

D  Term

A  Agent’s commission

B  Application fee

C  Origination fee

D  Underwriting fee

A  A type of financing

B  An eviction procedure

C  A type of foreclosure

D  A redemption

A  Loan-to-value ratio

B  Housing ratio

C  Total debt

D  Payment debt

A  Lower initial interest rate

B  Convertible feature

C  Balloon payment

D  Initial cap

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  CRV and seller concessions

B  Debt and net operating income

C  Housing ratio and total debt obligation

D  Residual income and debt-to-income

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

B  Could have been saved by paying discount points

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

D  Cash must be brought to closing

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

B  Scheduling the loan closing

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

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  A refinancing strategy

B  Paying off of a loan over time

C  An increase in property value

D  A decrease in property value

A  Equal Credit Opportunity Act

B  Consumer Credit Protection Act

C  Home Mortgage Discrimination Act

D  Community Reinvestment Act

A  Notice of sale

B  Foreclosure deed

C  Trustee’s deed

D  Deed of trust

A  One year in prison

B  Two years in prison

C  Five years in prison

D  Ten years in prison

A  Adjustable rate

B  Graduated payment

C  Renegotiable rate

D  Fixed rate

A  Note with mortgage

B  Last will and testament

C  Contract for deed

D  Note with deed of trust

A  Co-insurance

B  Co-pays

C  Covered events

D  Coverage limits

A  Title II, Section 203(n)

B  Title II, Section 251

C  Title II, Section 234(c)

D  Title I

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

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

C  Random charges

D  Extra money paid to cover any unexpected bank fees

A  $265,957

B  $650,000

C  $276,596

D  $250,000

A  California Foreclosure Reduction Act

B  Real Estate License Law

C  Mortgage Foreclosure Consultant Law

D  SAFE Act

A  Business checking account

B  Retirement account

C  Emergency fund

D  Income tax account

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

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

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

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

A  Yes

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

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

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

A  75%

B  72%

C  96%

D  82%

A  Special benefits

B  A certificate of appreciation

C  Interest

D  Five times their investment in return

A  Buyer

B  Lender

C  Seller

D  Settlement agent

A  Personal loan

B  Mobile home loan

C  Construction loan

D  Conventional loan

A  Over supply

B  Recovery

C  Recession

D  Expansion

A  Stock

B  Bond

C  Note

D  Bill

A  Trust it.

B  Ignore it.

C  Verify it.

D  Run a background check on it.

A  Jasmine can’t pay off her loan early.

B  Jasmine can’t occupy the residence.

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

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, she should have partial entitlement left.

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

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  Federal funds rate

B  Discount window

C  Reserve requirements

D  Open-market operations

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 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  Value in situ

B  Replacement value

C  GRM

D  Cap rate

A  Bridge loan

B  Amortized loan

C  Wrap-around mortgage

D  Fixed rate loan

A  Deficiency judgment

B  Short sale

C  Non-judicial foreclosure

D  Deed in lieu of foreclosure

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 80%.

C  Once the borrower has 20% or more equity.

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

A  Banks don’t have access to additional funds.

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

C  Interest rates plummet.

D  Banks are restricted from making loans to consumers.

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

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

A  Employment figures

B  Population size

C  Cost of living

D  Property lot size

A  Prohibits the borrower from suing the lender for mortgage fraud

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 lender from suing 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 laws don’t allow judicial foreclosure.

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 one year or less

B  With a maturity term of 30 years

C  Without a specified maturity term

D  With a maturity term between two and 10 years

A  Partnership between mortgagees

B  Partnership between mortgagors

C  Partnership between mortgagees and 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  It may be a first mortgage, a junior mortgage, or a junior wrap-around mortgage.

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

A  $30,000

B  $60,000

C  $300,000

D  $15,000

A  40 years

B  27.5 years

C  29 years

D  39 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; commercial and business loans are exempt from RESPA requirements.

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

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 break up with Nancy, as she costs too much.

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