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10 Cards in this Set
- Front
- Back
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Which of the following is true of VA loans?
A. The require a 3.5% borrower investment B. They require a mortgage insurance premium C. They are only available for 30-year terms D. They are assumable |
D. They are assumable
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As a GSE, what is Fannie Mae's primary function in the secondary market?
A. To provide a source of funds for lenders B. To fund loans C. To provide insurance for loans D. To approve loans |
A. To provide a source of funds for lenders
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A borrower is a 65 year old retiree with a fixed,income, and significant equity in his home. Which of the following would be the best option to supplement his income?
A. ARM B. SISA C. HECM D. HELOC |
C. HECM
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The Federal Housing Administration:
A. Guarantees loans B. Securitizes loans C. Insure loans D. Make loans |
C. Insure loans
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What is used to determine th einterest rate change on an ARM?
A. Index only B. Yield curve C. Caps only D. Index and margin |
D. Index and margin
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Nontraditional ARMs are considered the riskest of loans when they include any of the follwoing except:
A. A refinance provision B. No rate caps C. A low introductory rate that expires after a short period D. Limited documentation |
A. A refinance provision
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Concerning ARMs, margin is best defined as:
A. The maximun - or down 0 that a interest rate can ever adjust ib ab ARm B. The range of flexibility an interest rate has between caps on traditional ARMs C. A number, expressed as percentage, that represents a lenders operating costs and profit margin D. The amount of compensation earned by a mortgage professional for originating the ARM |
C. A number, expressed as percentage, that represents a lenders operating costs and profit margin
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Increasing loan balances resulting from the application of periodic payments creates which of the following for borrowers:
A. Negative amortization B. Lower credit scores C. Payment shock D. Negative equity |
A. Negative amortization
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Which of the following loan types is best described as a loan with a payment schedule made up of a series of small period payments and a larger lump sum due upon maturity?
A. A 2/1 buy down B. A loan with a balloon payment provision C. A reverse mortgage D. An Adjustable mortgage loan |
B. A loan with a balloon payment provision
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Which of the following is the best example of a loan that exceed Fannie Mae and Freddie Mac's maximum loan limits?
A. A non-conforming loan B. A subprime loan C. A conventional loan D. A government loan such as FHA or VA |
A. A non-conforming loan
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