State Exam Ch 14

Front 1

Chapter 14

Adjustable rate mortgage

Back 1

a plan, where the interest rate charged, goes up, or down, periodically.

Front 2

Amendatory clause

Back 2

A buyer, getting an FHA loan, can rescind the contract, if the appraisal, is lower than, the purchase price.

Front 3

Amortization schedule

Back 3

Written, listing, of each payment, broken down into, interests, principal, and remaining debt.

Front 4

Amortized loan

Back 4

Slowly, kills off, a debt, over time, through periodic payments, to the lender. Also called, self-liquidating loan.

Front 5

Assumable

Back 5

The mortgage, can be taken over, by the next buyer.

Front 6

Biweekly mortgage

Back 6

A repayment plan, that is the equivalent, of 13 monthly payments, per year.

Front 7

B. P. O. (Broker price option)

Back 7

Written estimate, of value, by a real estate licensee.

Front 8

Budget loan

Back 8

A monthly payment, including property taxes, and insurance.

Front 9

Buydown

Back 9

Payment of extra points, in return, for lower interest rate.

Front 10

Cap

Back 10

Percentage, beyond which interest rates, cannot be raised at adjustment.

Front 11

Ceiling

Back 11

Highest interest rate, ever allowed, on a specific, adjustable loan

Front 12

Certificate of Reasonable Value. CRV

Back 12

VA approval statement, VA Appraisal.

Front 13

Federal housing Administration

(F.H.A.)

Back 13

U. S. Agency, that ensures mortgage, to protect lending institutions

Front 14

F. H. A. 203b

Back 14

Lowdown - payment insurance mortgage loan

Front 15

Index

Back 15

a guide, to the National Mortgage Trends, used, for adjustable mortgage rates.

Front 16

Interest (O. P. P.)

Back 16

A charge, for the use of, other people's money.

Front 17

Loan-to-value ratio

Back 17

Percentage of, a property's, market value, that maybe borrowed.

Front 18

Margin

Back 18

Percentage charge, by the Lender, above, the index rate.

Front 19

New Jersey housing and mortgage Finance Agency

Back 19

Lender, of low interest money loans, in certain areas.

Front 20

P.I.T.I. (Principal, Interest, Tax, and Insurance Reserve)

Back 20

Mortgage payment, including interest, amortization, and certain expenses.

Front 21

Amortization

Back 21

the action, or process, of gradually writing off, the initial cost, of an asset.

Front 22

Point

Back 22

1% of the loan amount, charged as, extra up front interest , when a loan, is made.

Front 23

Private mortgage insurance (P. M. I.)

Back 23

Protection, for the lender, on a, low down payment, mortgage loan.

Front 24

Straight loan

Back 24

Mortgage, with payments, of interest-only. principal is paid, at the end of the loan.

Front 25

Target area

Back 25

Neighborhood, in which the state, wishes to, strengthen, the housing stock.

Front 26

V. A. Mortgage

Back 26

Loan guaranteed, by the federal government.

Front 27

Equity

Back 27

Difference between, current value, and money owed

Front 28

Toolkit

Back 28

Explanation, of financial terms.

Front 29

Rate Lock

Back 29

Lender agrees, to hold the interest rate, for a certain period of time.

Front 30

80% LTV ratio on the $240,000 how much down payment is needed?

A. $40,000.

B. $48,000.

C. $80,000.

D. $160,000.

Back 30

$240,000 minus 20% = $48,000

Front 31

John, allows monthly mortgage payments, to be figured, on a 30-year basis, so that Tim can handle them. At the end of the fifth year, John wants the whole, remaining debt, paid off, in a?

A. Graduated payment.

B. Shared-equity payment.

C. Balloon payment.

D. Blanket payment.

Back 31

Answer.

C. Balloon payment

Front 32

With some exceptions, a homemaker, may take, an income tax deduction from?

A. The mortgage insurance premium.

B. The mortgage interest paid.

C. The property insurance premium.

D. All of the above

Back 32

Answer.

B. The mortgage interest paid

Front 33

The terms, index, Margin, and cap, are used in, evaluating, what type of mortgage?

Back 33

Adjustable rate

Front 34

A lending institution, may require, the buyer, to spend extra money, to cover future bills, for?

Back 34

Property taxes, and insurance premiums

Front 35

Conventional loan

Back 35

A loan, not insured, or guaranteed, by a government agency.

Front 36

Which of the following, is an example, of a, conventional loan?

A. A mortgage loan, insured by, the federal housing Administration.

B. A second loan, for Home Improvement, secured through, a Credit Union.

C. A mortgage, obtained , through a private lender, with a VA guarantee.

D. All of the above.

Back 36

Answer.

B. A second loan, for Home Improvement, secured through, a Credit Union.

Front 37

Private mortgage insurance

(P. M. I.)

is required whenever?

Back 37

The buyer, is putting less than, 20% down, on a conventional loan.

Front 38

The Department, of Housing and Urban Development, insures mortgage loans, made through?

Back 38

(F. H. A.) Federal housing Administration

Front 39

No down payment, is required, for loans made through?

Back 39

The V. A., Veteran's Administrations

Front 40

Money for F. H. A. & V. A. Mortgages, come from?

Back 40

Qualified local, lending institutions

Front 41

The government, normally lend's, money directly, with what kind of loan?

Back 41

R. E. C. D. Rural Economic and Community Development

Front 42

In an amortized loan, how are, monthly payments, applied?

Back 42

Principal increases, as interest decreases.

Front 43

Amortized

Back 43

gradually write off the initial cost of (an asset) over a period of time.

Front 44

Who is responsible, for explaining, mortgage Financial Concepts, to buyers, who need a mortgage?

Back 44

No One

Chapter 14