REAE 3325 Exam 2 Isbell Vocab Only (Ch 9-13) with All Correct Solutions
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REAE 3325
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REAE 3325
REAE 3325 Exam 2 Isbell Vocab Only (Ch 9-13) with All Correct SolutionsREAE 3325 Exam 2 Isbell Vocab Only (Ch 9-13) with All Correct SolutionsREAE 3325 Exam 2 Isbell Vocab Only (Ch 9-13) with All Correct SolutionsREAE 3325 Exam 2 Isbell Vocab Only (Ch 9-13) with All Correct SolutionsNote - ANSWER-d...
REAE 3325 Exam 2 Isbell Vocab Only
(Ch 9-13) with All Correct Solutions
Note - ANSWER-defines the exact terms and conditions of the load. Both the large size
of real estate loan and the long maturity compel the not to be very explicit to prevent
misunderstandings between the borrower and the lender
Contract for Sale - ANSWER-The legal document between a buyer and seller that
states the purchase price and other details of the transaction, and the detailed manner
in which ownership rights are to be transferred. Is generally regarded as the most
important contract in real estate.
Mortgage menu - ANSWER-The many types of residential loans offered by originating
lenders to residential borrowers. The menu includes the cost of the various mortgage
items, including the contract interest rate and number of upfront discount points and
origination fees.
Commission - ANSWER-Payment a real estate salesperson receives for services
rendered, usually expressed as a percentage of the property sale price and not usually
paid until the transaction is closed.
Thrifts - ANSWER-Depository institutions that evolved primarily to collect and invest
household savings. Usually the term encompasses (former) savings and loan
associations and savings banks, but not credit unions. Thrifts invested largely in home
mortgage loans, and for well over a century, until about 1980, were the backbone of
home mortgage finance in the United States.
Adjustable rate mortgage (ARM): - ANSWER-mortgage loans that use an adjustable
interest rates. These types of loans are common in commercial real estate and in many
home loans
Primary mortgage market - ANSWER-The loan origination market where borrowers and
lenders negotiate mortgage terms.
Disintermediation - ANSWER-Reference to the occurrence of conditions when the
growth of deposits in banks and savings associations becomes negative, due to other,
more attractive, direct investment opportunities.
Net Listing - ANSWER-Type of contract in which sellers specify the amount they will
accept from the sale, with brokers keeping all proceeds in excess of that amount.
, Contract Terms - ANSWER-The detailed requirements of a fully enforceable contract,
such as the price, the down payment, any seller financing, provisions for inspections,
type evidence of title, type of deed, dates, and other details of the transaction process.
Index rate - ANSWER-a market determined interest rate that is the "moving part" in the
adjustable interest rate.
Secondary mortgage market - ANSWER-The market where mortgage originators can
divest their holdings, and existing mortgages are resold.
Commercial Banks - ANSWER-Depository institutions primarily engaged in the business
of making short-term loans to businesses for inventory financing and other working
capital needs.
Law of Agency - ANSWER-The legal rights, duties, and liabilities of principal, agent, and
third parties as a result of the agency relationship between them.
Contract Conditions - ANSWER-Specific requirements that must be satisfied by or for a
party to a contract. (See contract with contingencies.)
Constant maturity - ANSWER-a common index for ARM home loans. The 1 year
constant maturity rate, for example, is the average of the market yield, found by survey,
on any outstanding US Treasury debt having exactly one year remaining to final
repayment, regardless of original maturity.
Fannie Mae - ANSWER-Government-sponsored enterprise; one of the largest
purchasers of residential mortgages in the secondary market.
Warehousing - ANSWER-The provision by commercial banks of short-term funds to
mortgage banking companies to enable them to originate and fund mortgage loans until
they can be sold in the secondary mortgage market.
Principal - ANSWER-In brokerage, the person giving authority to an agent; in finance,
the amount borrowed and owed on a loan.
Closing - ANSWER-Event at which possession and title to real estate normally are
transferred from seller to buyer.
Special agent - ANSWER-A person to whom a principal has granted authority to handle
a specific business transaction or to perform a specific function. Real estate brokers and
salespersons are special agents.
Equitable title - ANSWER-The right of someone to obtain full, legal title to real estate,
provided the terms and conditions of the document creating equitable title (usually a
contract for sale) are fulfilled.
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