Chapter 13 Review

When applying for a conventional mortgage loan, the appraiser determines whether the structure meets certain required minimum standards

• True

• False

The Uniform residential Loan Application is used to qualify loan applicants applying for a loan to finance a single-family residential property

• True

• False

Private mortgage insurance is required for conventional mortgages with a loan-to-value ratio (LTV) greater than 20%

• True

• False

The total obligations ratio (TOR) may not exceed 36% for conventional mortgage loans

• True

• False

A conventional loan is one that is NOT insured or guaranteed by a government agency

• True

• False

The calculated interest rate is the lender's margin added to the index

• True

• False

An amortized mortgage is characterized by a constant (level) monthly payment

• True

• False

In times of rising interest rates, including a payment cap in an adjustable-rate mortgage reduces the amount of interest the borrower will pay over the life of the loan

• True

• False

The monthly payment shown on an amortization table consists of principal, interest, taxes, and insurance (PITI).

• True

• False

Negative amortization results from a mortgage payment that does NOT pay all of the interest due for the period

• True

• False