Quiz 8 Flashcards - loan become due and payable when an owner is al...

Quiz 8 Flashcards

• With what type of clause does the entire balance of the

loan become due and payable when an owner is alienating, transferring, or conveying a property?a. Alienation clauseb.Conveyance clausec. Transfer claused. None of the above a (p.222)

• Which of the following liens are NOT eliminated by a

foreclosure sale?a. Federal tax liensb. State, county, or city assessmentsc. State, county or city taxesd. All of the above d (p.240)

• The trustee issues a reconveyance deed when the

promissory note is:a. paid in full.b. in default.c. recorded.d.

expired.a (p.235)

19. The 1% loan fee on FHA loans is usually paid by the:a.

lender.b. broker.c. buyer.d. seller.d (p.228)

16. Impound accounts are NOT used to pay:a. interest.b.

property taxes.c. fire insurance.d. all of the above.a (p.223)

12. Another term for the trustee is:a. borrower.b. lender.c.

third party.d. escrow company.c (p.232)

• A clause in a financial instrument that allows a lender to

demand immediate payment of the entire note balance is

known as a(n):a. acceleration clause.b. damage clause.c.

assumption clause.d. demand clause.a (p.222)

• Which of the following is NOT a party to a trust deed?a.

Grantorb. Beneficiaryc. Trusteed. Trustor a (p.232)

• The practice of purchasing real estate using a small

amount of your own money and a large portion of borrowed

funds is known as:a. hypothecation.b. Ieverage.c.

amortization.d. alienation.b (p.217)

• The basic instrument used to evidence an obligation or

debt is a:a. trust deed.b. promissory note.c. Iand contract.d.

mortgage.b (p.219)

13. The trustor is also known as the:a. escrow.b. third

party.c. borrower.d. Iender.c (p.232)

• A person who takes a negotiable instrument from

another with no knowledge of defect is called a(n):a.

assignee.b. attorney-in-fact.c. holder in due course.d.Iimited note holder.c (p.222)

• What document does a trustee record after being notified

by the lender of the trustor's nonpayment?a. Request for Noticeb. Notice of Foreclosurec. Notice of Defaultd. Notice of Deficiency c (p.236)

• What provision in an instrument of finance would permit

a change in the priority of liens on a property?a.

Subordination clauseb. Acceleration clausec. Alienation claused. MPR provision a (p.222)

• Which of the following is FALSE concerning the

APR?a. It is expressed as an annual rate.b. It is expressed as a weekly rate.c. It is expressed as a percentage rate.d.It includes all credit costs.b (p.247)

• What type of fixed interest loan has payments that start

out lower and gradually increase?a. Graduated payment mortgageb. Adjustable rate mortgagec. Fixed rate mortgaged. Reverse annuity mortgage a (p.227)

17. The nominal interest rate is:a. stated in the note.b.

compounded daily.c. the current interest rate.d. the effective interest rate.a (p.223)

• A lender charges an origination fee, which includes

points. One "point" is equal to:a. 1% of the loan amount.b.

.01% of the loan amount.c. 10% of the loan amount.d.100% of the loan amount.a (p.227)

• Should the trustor default, the trustee may have to sell

the property for the:a. trustor.b. trustee.c. beneficiary.d. title

insurance company.c (p.232)

• What do we call a borrower who secures a loan through

a trust deed?a. Trustorb. Trusteec. Beneficiaryd. Holder in due course a (p.232)