Real Estate Finance Practice Test

95 Questions | Total Attempts: 6881

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Real Estate Quizzes & Trivia

Questions and Answers
  • 1. 
    A type of mortgage in which the lender makes periodic payments to the borrow, who is required to be age 62 or older in the FHA program, is called 
    • A. 

      Opposite

    • B. 

      Accelerate

    • C. 

      Reverse

    • D. 

      Deficit

  • 2. 
    A conventional mortgage isa
    • A. 

      Amortizing

    • B. 

      Guaranteed by the FHA

    • C. 

      Not guaranteed by any government agency

    • D. 

      Approved by the VA

  • 3. 
    A chattel mortgage is usually given in connection with
    • A. 

      Realty

    • B. 

      Farms

    • C. 

      Personal Property

    • D. 

      Commercial Property

  • 4. 
    The lending of money at a rate of interest above the legal rate is
    • A. 

      Speculation

    • B. 

      Usury

    • C. 

      Both and B

    • D. 

      Neither A nor B

  • 5. 
    One discount point is equal to
    • A. 

      1% of the sales price

    • B. 

      1% of the interest sale

    • C. 

      1% of the loan amount

    • D. 

      None of the above

  • 6. 
    Discount points in FHA and VA loans are generally paid by the
    • A. 

      Lender

    • B. 

      Purchaser

    • C. 

      Seller

    • D. 

      Broker

  • 7. 
    The main appeal of VA mortgages to borrowers lies in
    • A. 

      Low interest rates

    • B. 

      Minimum down payment

    • C. 

      An unlimited mortgage ceiling

    • D. 

      Easy availability

  • 8. 
    When a loan is assumed on property that is sold
    • A. 

      The original borrower is relieved of further responsibility

    • B. 

      The purchaser becomes liable for the debt

    • C. 

      The purchaser must obtain a certificate of eligibility

    • D. 

      All of the above

  • 9. 
    An estopple certificate is required when the
    • A. 

      Mortgage is sold to an investor

    • B. 

      Property is sold

    • C. 

      Property is being foreclosed

    • D. 

      Mortgage is assumed

  • 10. 
    An owner who seeks a mortgage loan and offers three properties as security will give
    • A. 

      A blanket mortgage

    • B. 

      An FHA mortgage

    • C. 

      A conventional mortgage

    • D. 

      A chattel mortgage

  • 11. 
    A clause in a mortgage or accompanying note that permits the creditor to declare the entire principle balance due upon certain default of the debtor is 
    • A. 

      An acceleration clause

    • B. 

      An escalation clause

    • C. 

      A forfeiture clause

    • D. 

      An excelerator clause

  • 12. 
    Which of the following statement is (are) false
    • A. 

      VA loans are insured loans

    • B. 

      FHA loans are guaranteed loans

    • C. 

      Both A and B

    • D. 

      None of the above

  • 13. 
    A second mortgage is
    • A. 

      A lien on real estate that has a prior mortgage on it

    • B. 

      The first mortgage recorded

    • C. 

      Always made by the seller

    • D. 

      Smaller in amount than a first mortgage

  • 14. 
    Fannie Mae Is
    • A. 

      An originator of mortgage loans

    • B. 

      A purchaser of mortgage loans

    • C. 

      An agency of the Federal Housing Administartion

    • D. 

      A branch of the Federal Reserve

  • 15. 
    A large final payment on a mortgage loan is
    • A. 

      An escalator

    • B. 

      A balloon

    • C. 

      An amortization

    • D. 

      A package

  • 16. 
    A requirement for a borrower under an FHA-insured loan is that he
    • A. 

      Not be eligible for a VA or conventional loan

    • B. 

      Have cash for the down payment and closing costs

    • C. 

      Have his wife sign as coborrower

    • D. 

      Certify that he is receiving welfare payments

  • 17. 
    A mortgaged property can be
    • A. 

      Sold without the consent of the mortgagee

    • B. 

      Conveyed by the grantors making a deed to the grantee

    • C. 

      Both A and B

    • D. 

      None

  • 18. 
    In the absence of an agreement to the contrary, the mortgage normally having priority will be the one
    • A. 

      For the greatest amount

    • B. 

      That is a permanent mortgage

    • C. 

      That was recorded first

    • D. 

      That is a construction loan mortgage

  • 19. 
    The seller would have the least financing exposure in
    • A. 

      New financing by buyer

    • B. 

      Purchase money mortage

    • C. 

      Assumption of loan by buyer

    • D. 

      Purchase "subject to" mortgage

  • 20. 
    The mortgage’s right to reestablish ownership after delinquency is known as
    • A. 

      Reestablishment

    • B. 

      Satisfication

    • C. 

      Equity of redemption

    • D. 

      Acceleration

  • 21. 
    A first-time buyer's down payment source may be
    • A. 

      Savings

    • B. 

      A gift from a relative

    • C. 

      A personal loan

    • D. 

      Any of the above

  • 22. 
    The money for making FHA loans is provided by
    • A. 

      Qualified lending institutions

    • B. 

      The Department of Housing and Urban Development

    • C. 

      The Federal Housing Administration

    • D. 

      The Federal Saving and Loans Insurance Corporation

  • 23. 
    Amortization is best defined as
    • A. 

      Liquidation of a debt

    • B. 

      Depreciation of a tangible asset

    • C. 

      Winging up a business

    • D. 

      Payment of interest

  • 24. 
    A mortgage is usually releseaded of record by a 
    • A. 

      Real estate

    • B. 

      Mobile home

    • C. 

      Both A and B

    • D. 

      Neither

  • 25. 
    A seller took 10% down in cash and provided 90% of the sale price as a first mortgage. The best way to describe the mortgage is 
    • A. 

      Home equity loan

    • B. 

      Fixed interest rate

    • C. 

      Purchase-money mortgage

    • D. 

      Buyer financing

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