REAE 3325 CH 9 QUESTIONS AND ANSWERS (GRADED A)REAE 3325 CH 9 QUESTIONS AND ANSWERS (GRADED A)REAE 3325 CH 9 QUESTIONS AND ANSWERS (GRADED A)REAE 3325 CH 9 QUESTIONS AND ANSWERS (GRADED A)
In a mortgage loan, the borrower always creates two documents: a note and a mortgage. Which of the following ...
REAE 3325 CH 9 QUESTIONS AND
ANSWERS (GRADED A)
In a mortgage loan, the borrower always creates two documents: a note and a
mortgage. Which of the following pieces of information is provided in the mortgage? -
ANSWER-description of the property
For income-producing property, the most common index rate is the: - ANSWER-London
Interbank Offered Rate (LIBOR)
Defeasance prepayment penalty - ANSWER-prepayment penalties requires a borrower
to provide the lender with some combination of U.S. Treasury securities that will serve
to replace the cash flows of the loan being paid off
Escrow - ANSWER-requires a borrower to make monthly deposits into an account in
order to pay obligations such as property taxes, community association fees, or
causality insurance premiums
Most Adjustable Rate Mortgage (ARM) loans have been marketed with a temporarily
reduced interest rate referred to as a - ANSWER-prepayment rate
Conventional home loan - ANSWER-this mortgage loans contain a due-on-sale clause,
which gives the lender the right to terminate the loan at sale of the property
negatively amortizing - ANSWER-a scheduled mortgage payment that is insufficient to
pay all of the accumulating interest, causing some interest to be added to the
outstanding balance after each payment shortfall
Mortgagee - ANSWER-Lender
recourse loans - ANSWER-the lender can hold the borrower personally liable in the
event of a default
Deed in lieu of foreclosure - ANSWER-if short sale is not feasible, lender allows the
borrower simply to convey the property to the lender rather than pursuing a court
supervised process
how many days must a payment be overdue in order for lenders to treat a default as
serious - ANSWER-90 days
Foreclosure - ANSWER-allows the lender to bring about sale of the property to recover
the outstanding indebtedness.
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