Real Estate - Unit 15 Review Questions Flashcards

Real Estate - Unit 15 Review Questions Flashcards Which of the following represents the purpose of Freddie Mac?A. Guarantees mortgages by the full faith and credit of the federal governmentB. buys and pools blocks of conventional mortgages, selling bonds with such mortgages as securityC. affects the mortgage market through adjustment of the discount rateD. forbids the charging of more than one point to the buyer B A developer obtains one mortgage for a whole subdivision.As he sells each lot, he obtains a release of one parcel from theA. package mortgageB. reverse mortgageC.balloon mortgageD. blanket mortgage D The public can invest in mortgage pools by buying certificates issued by theA. Federal Reserve BankB.Farmer's Home AdministrationC. Government National Mortgage AssociationD. Guaranteed Mortgage Fund C An elderly widow is on Social Security and a small fixed income. She wants to stay in her longtime home, which now has a market value of more than $200,000, but she cannot afford rising property taxes, and the house needs a new roof. This person is a perfect candidate for a(n)A.equity-sharing arrangementB. reverse mortgageC. home equity loanD. interim finance loan B What is Fannie Mae?A. the leading purchaser of mortgages on the secondary marketB. a lender for homes in rural areasC. a government agency that regulates interest ratesD. an old woman who lives in a cave A The term purchase-money mortgage appliesA. to any mortgage used to finance the purchase of real estateB. to any mortgage for which real estate is pledged as securityC.only to a mortgage loan made by a regular lending institutionD. only to a mortgage loan "taken back" by the seller A Real estate brokers should be particularly careful to seek an attorney's assistance when a real estate transaction involves aA. home equity loanB. construction loanC.package mortgageD. wraparound mortgage D When a bank allows a buyer to spend up to 28% of gross income on housing costs, it is applying a formula known as aA. loan-to-value ratioB. qualifying ratioC. PMI guaranteeD.low-income subsidy B

Which of the following BEST defines the secondary market?A. lenders who exclusively deal in second mortgagesB. lenders who buy and sell mortgages after they have been originatedC. the major lender of residential mortgagesD. the major lender of FHA and VA loans B The buyer does NOT immediately receive a deed when purchasing with aA. sale-leasebackB. seller-financed mortgageC. balloon mortgageD. land contract D Which of the following is NOT a participant in the nation's secondary mortgage market?A. FmHAB. Ginnie MaeC.Fannie MaeD. FHLMC A An investor buys a local factory from a company that intends to remain and rent the building from him. The investor has put together a(n)A. equity-sharing transactionB. sale-leasebackC. secondary marketD.reserve for escrow B A couple purchased a residence for $375k. They made a down payment of $45k and agreed to assume the seller's existing mortgage, which had a current balance of $123k.The couple financed the remaining $207k of the purchase price by giving a mortgage and note to the seller. This type of loan, by which the seller becomes a mortgagee, is called aA. wraparound mortgageB. package mortgageC. balloon noteD. purchase-money mortgage D What is the function of mortgage brokers?A. make mortgage loansB. bring borrowers and lenders togetherC.service mortgage loansD. sell packages of mortgages to investors B