Prepayment risk - Study guides, Class notes & Summaries

What must a borrower do to avoid having late payments reported to a credit bureau? - Pay within 30 days of due date Max penalty if a borrower is required to use a specific title company or settlement agent? - 3 times the fee What should not be over-weighted in an analysis of borrower repayment capacity? - Credit scores Max prepayment penalty on residential mortgages in the first year of the loan - 3% What must condominium associations do with respect to property insurance? - Keep a "blank...

true or false: financial decision making is based on the concept of wealth maximization - ANSWERtrue true or false: the internal rate of return is the interest rate for which a project's net present value (NPV) is exactly equal to zero - ANSWERtrue true or false: initial equity is the purchase price less any debt used to complete the purchase - ANSWERtrue which of the following is not a characteristic of risk? a) the later the cash flows are expected to be received, the greater the ri...

NMLS SAFE EXAM 2024 QUESTIONS AND ANSWERS ALREADY PASSED What does TILA stand for? Truth-In-Lending Act, Regulation Z What is a HELOC loan? a secured loan in that you are borrowing against the equity that has been built in your house What is a REFI loan? LTV stands for Loan to Value Define PMI and state what the acronym stands for. Private mortgage insurance- on conventional loans Define one time variable funding fee and people in what situations is it waived for? Disabled ...

CAIA Level 1 - Topic 6 Structured Products Questions& Answers 100% Accurate! Primary economic role of structuring - ANSWER-Structured securities complete the market - structured to meet all different needs & helps investors prepare for all states of the world MBS - ANSWER-Mortgage-backed securities - security secured by pool of mortgages (mortgages are the collateral) RMBS - Agency RMBS - ANSWER-Residential MBS - low credit risk: backed by the US government - has prepayment risk: borrowe...

CAIA Level 1 - Topic 6 Structured Products Questions and Answers 100% CorrectCAIA Level 1 - Topic 6 Structured Products Questions and Answers 100% CorrectCAIA Level 1 - Topic 6 Structured Products Questions and Answers 100% CorrectCAIA Level 1 - Topic 6 Structured Products Questions and Answers 100% CorrectPrimary economic role of structuring - ANSWER-Structured securities complete the market - structured to meet all different needs & helps investors prepare for all states of the world MBS - ...

Primary economic role of structuring - ANSWER-Structured securities complete the market - structured to meet all different needs & helps investors prepare for all states of the world MBS - ANSWER-Mortgage-backed securities - security secured by pool of mortgages (mortgages are the collateral) RMBS - Agency RMBS - ANSWER-Residential MBS - low credit risk: backed by the US government - has prepayment risk: borrower' s right to repay mortgage early a key risk Contraction risk - ANSWER-Av...

NMLS SAFE EXAM 2024 Questions With Verified Answers What does TILA stand for? - answerTruth-In-Lending Act, Regulation Z What is a HELOC loan? - answera secured loan in that you are borrowing against the equity that has been built in your house What is a REFI loan? - answer LTV stands for - answerLoan to Value Define PMI and state what the acronym stands for. - answerPrivate mortgage insurance- on conventional loans Define one time variable funding fee and people in what situations is i...

NMLS SAFE EXAM 2024 Questions With Verified Answers What does TILA stand for? - answerTruth-In-Lending Act, Regulation Z What is a HELOC loan? - answera secured loan in that you are borrowing against the equity that has been built in your house What is a REFI loan? - answer LTV stands for - answerLoan to Value Define PMI and state what the acronym stands for. - answerPrivate mortgage insurance- on conventional loans Define one time variable funding fee and people in what situations is i...

Secondary Mortgage Market - ANSWERSMarket where existing mortgages are bought and sold Mortgages - ANSWERSWhat is used for collateral for mortgage related securities? Reduces reliance on deposits - ANSWERSWhat is the effect of the secondary mortgage market with respect to lender reliance on deposits? By issuing mortgage backed bonds collateralized by the purchased mortgages. - ANSWERSHow do firms raise money to purchase mortgages in the secondary market? 1. Mortgage assets were non h...

CFA Level 1 - Fixed Income Exam Questions with Correct Answers Coupon Rate Floor - Answer-Minimum periodic coupon interest payment received by lender/security owner. Coupon Rate Collar - Answer-Simultaneous combination of both cap and floor. Regular Redemption - Answer-When bonds are redeemed under the call provisions specified in the bond indenture. Special Redemption - Answer-When bonds are redeemed to comply with a sinking fund provision or because of a property sale mandated by...