Practice - Chpt 19

Question 1

Lender may protect its interest in a conventional mortgage loan by asking the buyer to obtain additional security from

Accepted Answer

private mortgage insurance

Question 2

The purpose of the Real Estate Settlement Procedures Act (RESPA) is to

Accepted Answer

see that buyers and sellers know all their settlement costs

Question 3

The amount of a loan expressed as a percentage of the value of the real estate offered as collateral is the

Accepted Answer

loan-to-value ratio

Question 4

Regulation Z generally applies when a credit transaction is secured by

Accepted Answer

a residence

Question 5

Who gets the BEST interest rates?

Accepted Answer

Owner occupants

Question 6

Which federal law requires that borrowers be provided with a free credit report once a year?

Accepted Answer

Fair and Accurate Credit Transactions Act

Question 7

The buyers were turned down for a mortgage loan. By law, the lender

Accepted Answer

must inform the rejected applicants in writing the reasons within 30 days.

Question 8

An FHA-insured mortgage loan would be obtained from

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any qualified lending institution

Question 9

Which of the following is required for a veteran to receive a VA loan?

Accepted Answer

A certificate of reasonable value

Question 10

Lender considers certain factors in deciding to grant a mortgage loan. All of the following are legitimate except

Accepted Answer

the marital status of the borrower

Question 11

Under an installment contract, title to the property is held by the

Accepted Answer

vendor

Question 12

In an adjustable-rate mortgage, what represents the lender's cost of doing business?

Accepted Answer

Margin

Question 13

For what type of loan is the lender likely to charge a lower interest rate?

Accepted Answer

15 year fixed rate

Question 14

Which law requires that all advertising that references mortgage financing terms contain certain disclosures?

Accepted Answer

Truth in Lending Act (Regulation Z)

Question 15

A land contract provides for the

Accepted Answer

conveyance of legal title at a future date

Question 16

Process by which the lender determines the upper loan limit for which the buyer will qualify is

Accepted Answer

prequalification

Questions 16