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REE 4204 SIRMANS EXAM 1 QUESTIONS WITH VERIFIED ANSWERS $12.79   Add to cart

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REE 4204 SIRMANS EXAM 1 QUESTIONS WITH VERIFIED ANSWERS

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REE 4204 SIRMANS EXAM 1 QUESTIONS WITH VERIFIED ANSWERS 1980's - Answer--depository insititutions deregulations and monetary control act -garn st germain act-introduced competition and incentives for risk taking -widespread saving and loan failures do to deregulation 1990's - Answer--dominance ...

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  • September 5, 2024
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  • 2024/2025
  • Exam (elaborations)
  • Questions & answers
  • REE 4204 SIRMANS
  • REE 4204 SIRMANS
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REE 4204 SIRMANS EXAM 1
QUESTIONS WITH VERIFIED
ANSWERS

1980's - Answer--depository insititutions deregulations and monetary control act
-garn st germain act-introduced competition and incentives for risk taking
-widespread saving and loan failures do to deregulation

1990's - Answer--dominance of government sponsered enterprises
-baby boomers increase demand for housing
-low mortgage intrest rates

2000's - Answer--housing market craze
-housing prices were raised over 80%
-sharp drop of market priced due to unsold homes
-several wall street firms demolished and fannie mae and freddie mac were taken over
by gov
-rebound in housing prices now we have historically low interest rates

Amortization of a mortgage - Answer--as time goes up interest payments get smaller
due to the decreasing principal amount borrowed, and repayment of the principal
portion increases

outstanding balance of the mortgage - Answer--the outstanding balance is the present
value of the remaining stream of payments, discounted at the contract rate

factors affecting interest rate - Answer--increase in loan amount
-loan term
-lock in period
-down payment
-discount points
-credit score

effective cost of the mortgage - Answer--borrowers actual percentage cost of borrowing
-affected by loan fees charged by the lender

discount points - Answer-lower the contract rate which lowers the payment rate, interest
rate goes down, pays off quicker

annual percentage rate - Answer-effective borrowing cost of a loan, assuming it is held
to maturity

bi-weekly mortgage - Answer-reduces the payment period for the mortgage, holding the
amount and the interest rate constant

, prepayment protection mortgage - Answer--borrower give uo the right to prepay the
mortgage without penalty in exchange for a lower interest rate

negative discount points - Answer--cash payment from lender to the borrower-which will
raise the contract rate
-contract inrest rate would be above par

fixed mortgage and interest rate risk - Answer--interest rate risk-risk of loss due to
changes in the market interest rates
-market values of fixed rate mortgages change inversely with market rate changes

The mortgage constant calculates the payment per dollar borrowed at a given interest
rate and term. - Answer-True

Finance - Answer--study of the process, institutions,markets and instruments used to
transfer money and credit between individuals, business, and gov

applied economics - Answer--study of the allocation of resources for the purpose of
producing goods and services for various members of society
-considers time value of money and implications of the interest rates
-focused on cash flows not profts
-makes extensive use of the concept of risk

Real estate finance - Answer--study of institutions, markets, and instruments used to
transfer money and credit for the purpose of developing or acquiring real property

real property - Answer--rights,powers, and privileges associated with the use of real
estate

real estate - Answer-land and all the fixed immovable improvements on it

Environment of real estate - Answer-the institutions that create and purchase real
property and the markets within which they are transferred

financial intermediaries - Answer--the financial institutions that channel funds from the
surplus income units to the deficit income units
-commercial banks
-thrift instituions- S&L associations and mutual savings banks
-investment companies-pool the funds of savers and invest the funds in a portfolio of
assets
- insurance companies- receive periodic or lump sum payments from individiudals or
organizations in return for a promise to make future payments if certain events occur
-pension funds

Direct financing - Answer-- when the flow of funds takes the place without the use of
intermediaries

primary mortgage market - Answer--market where mortgages are originated

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