Exam (elaborations)
Champions Real Estate Exam Prep National Ch 7 Questions and Answers
Champions Real Estate Exam Prep National Ch 7 Questions and Answers
[Show more]
Content preview
Champions Real Estate Exam PrepNational Ch 7 Questions and Answers
Mortgage Loans - -Most common choice for financing real property. Can be
conventional or non-conventional
-Conventional Loan - -Neither federally insured nor guaranteed
-Non-conventional Loan - -Federally insured/guaranteed mortgage loans to
encourage ownership (FHA, VA, USDA)
-Contract for Deed - -A means by which the seller passes possession but
retains title to the property until the total or a substantial portion of the
purchase price is paid. Installment contract. The two parties here are the
vendor (owner) and the vendee (buyer).
-Hypothecation - -The action of pledging real property as security for a debt
-Promissory Note - -A written promise to pay a specified amount of money
on demand or at a definite time
-Lien Theory - -When mortgage loan is used for purchase of real property,
at closing the buyer receives the title and the lender has a lien
-Title Theory - -At closing the lender receives the title and will hold it until
the lien is satisfied or paid off
-Deed of Trust - -Used instead of a traditional mortgage in Texas. Parties
are borrows (trustor), lender (beneficiary), and trustee
-Power of Sale Clause - -Allows for non-judicial foreclosure
-Trustee (Deed of Trust) - -Acts in fiduciary relationship with beneficiary,
released lien when not is paid or forecloses in the event of default
-Mortgagor - -"Gets the door" - buyer/borrower
-Mortgagee - -"Gets the fee" - lender
-Primary Market - -Market where consumers go to borrow money (mortgage
bankers, mortgage brokers, banks, credit unions)
, -Secondary Market - -Market where lenders go for money. Exists for the
purchase and sale of existing mortgages to investors → greater liquidity to
residential real estate market
-Conforming Loans - -Loans qualified to be purchased in the secondary
market. Meet purchase requirements of Fannie Mae and Freddie Mac
-Secondary Market Warehousing Agencies - -Fannie Mae, Freddie Mac,
Ginnie Mae
-Freddie Mac Forms - -Used to ensure loans can be sold in secondary
market
-Fixed-Rate Amortized Loan - -Equal, regular payments of principal and
interest until loan is repaid
-Interest Paid In Arrears - -Paid at the end of each payment period
-Term Loan - -Straight-loan, interest only paid until end of the term when
the entire principal is repaid (zero amortization)
-Blanket Loan - -Covers more than one piece of property. Contains release
clause
-Release Clause - -Allows borrower to obtain partial release of specific lots
by making required lump sum payments
-Package Loan - -Includes real property plus personal property (i.e. a
furnished condo)
-Budget Loan - -Includes PITI in monthly payments (principal, interest,
taxes, insurance)
-Balloon Loan - -Partially amortize with final payment substantially larger
than others → benefit of lower interest rate, disadvantage of high cost of
refinancing
-Participation Loan - -Two or more lenders invest in one loan
-Shared Appreciation Mortgage - -Lenders collect principal and interest and
shares in profits when the property is sold
-Open-End Mortgage - -Permits additional borrowing on the same loan
(HELOC - home equity line of credit)
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller Victorious23. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for £6.69. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
78834 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy revision notes and other study material for 14 years now