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Chapter 9- Real Estate Finance_ The Laws and Contracts _ (DETAILED ANSWERS) 2024 -
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8/1/24, 7:12 AM 1/11 Chapter 9- Real Estate Finance: The Laws and Contracts Jeremiah Terms in this set (76) The date when an adjustable interest rate is recomputed is called the __ date. change The repayment of a loan through the series of scheduled balance reductions is called: amortization or amortizing When the term for maturity is less than the term for amortization then the final payment is: a. all interest b. lower than the standard level payment over the life of the loan c. equal to the regular payment plus an unpaid balance d. all principal c. equal to the regular payment plus an unpaid balance Reasons for using debt financing in real estate include to: -enable greater diversification by purchase of more assets. -enable the purchase of a home. -preserve cash for use in one's primary business. -lever the purchase of investment property for higher returns. -increase the level of financial risk. -enable greater diversification by purchase of more assets. -enable the purchase of a home. -preserve cash for use in one's primary business. -lever the purchase of investment property for higher returns. 8/1/24, 7:12 AM 2/11 loan. If the interest charge for the current month for a standard home loan is $1,000.00, and the stated interest rate is 4.0 percent per year, what is the current balance on the loan? a. $300,000 b. $25,000 c. $48,000 d. $250,000 a. $300,000 If an adjustable rate mortgage has a payment cap but no interest cap, then it is possible for interest rate increases to result in interest charges exceeding the payment allowed. This results in unpaid interest being added to the loan balance, an effect known as __________ _. negative amortization. Different methods of amortization of a mortgage loan include: -partially amortizing, in which a final, larger balance payoff is required in the last payment. -non amortizing, in which the regular payments are interest only and the full balance is paid off in the last payment. -negative amortization in which the scheduled payments are less than the interest due, leaving the balance unchanged throughout. -fully amortizing, in which the loan exactly pays off with the last regular payment. -partially amortizing, in which a final, larger balance payoff is required in the last payment. -non amortizing, in which the regular payments are interest only and the full balance is paid off in the last payment. -fully amortizing, in which the loan exactly pays off with the last regular payment. For a mortgage loan the number of months over which a level payment will fully pay off the loan is called the term for ___ _. amortization The two documents of a mortgage loan are the __________ and the _ _. note; mortgage (or deed of trust) In the United States today, the general pattern for right of prepayment for home mortgage loans is as follows: a. a few first mortgage home loans allow prepayment without penalty. b. some first mortgage home loans allow prepayment without penalty. c. most first mortgage home loans allow prepayment without penalty. d. almost no first mortgage home loans allow prepayment without penalty. c. most first mortgage home loans allow prepayment without penalty. The note defines the exact ______ and ____ of a terms; conditions Chapter 9- Real Estate Finance: The Laws and ContractsThe benefits of buying summaries with Stuvia:
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