Exam (elaborations)
Real Estate Financing Practice: Questions & Answers
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Real Estate Financing Practice: Questions & Answers
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Real Estate Financing Practice:Questions & Answers
A Correct Ans - 1. K has just purchased his first home
with a fixed-rate loan. The interest he
will pay over the life of the loan is
a. simple interest.
b. compound interest.
c. prepaid interest.
d. discounted interest.
B Correct Ans - 2. The amount of a loan expressed as a
percentage of the value of the real estate offered as collateral is the
a. amortization ratio.
b. loan-to-value ratio.
c. debt-to-equity ratio.
d. capital-use ratio.
D Correct Ans - 3. The purpose of the Real Estate
Settlement Procedures Act (RESPA)
is to
a. see that buyers do not borrow
more money than they can repay.
b. make real estate brokers more
responsive to the needs of
buyers.
c. help sellers know how much
money is required to purchase
the property.
d. see that buyers and sellers know
all of their settlement costs.
D Correct Ans - 4. If the quarterly interest at 10-1/2
percent is $3,150, the principal
, amount of the loan is
a. $30,000.
b. $60,000.
c. $90,000.
d. $120,000.
B Correct Ans - 5. Fannie Mae
a. makes FHA loans.
b. buys FHA loans.
c. services FHA loans.
d. insures FHA loans.
C Correct Ans - 6. The grantor becomes the lessee and
the grantee becomes the lessor under which of the following financing
arrangements?
a. Partial sale
b. Wraparound mortgage
c. Sale and leaseback
d. Assumption of mortgage
A Correct Ans - 7. Which of the following pairs of terms is considered
synonymous?
a. Interim financing and
construction loan
b. Construction loan and
pass-through loan
c. Pass-through loan and take-out
loan
d. Take-out loan and construction
loan
B Correct Ans - 8. The type of real estate loan that allows the lender to
increase the outstanding
balance of a loan up to the original
sum in the note while advancing
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