Module 4 Quiz (Aff)

What is the LEAST acceptable factor in evaluating a mortgage loan application? Choose only ONE best answer.

• amount of income

• credit history

• debt

• source of income

An 80/20 combo loan with the sales price of $175,000, a rate of 6% for the 80% first mortgage, and a rate of 8.5% for the 20% second mortgage would have a first mortgage loan amount of what? Choose only ONE best answer.

• $35,000

• $105,000

• $140,000

• $175,000

A borrower wants to get a loan to buy a house. When evaluating his credit obligations, which would NOT be considered as debt? Choose only ONE best answer.

• cable service payment

• car payment

• child support payments

• credit card payments

While underwriting a loan file, you calculate this formula: PITI divided by income. What have you just determined? Choose only ONE best answer.

• housing expense ratio

• loan-to-value ratio

• stable monthly income ratio

• total debt to income ratio

A borrower has a stable monthly income of $4,000 and recurring debts of $600. If he’s getting an FHA loan, what’s the maximum monthly payment for which he would qualify? Choose only ONE best answer.

• $1,054

• $1,120

• $1,240

• $1,462

You are pre-qualifying a borrower for a purchase loan. She has debt equaling $950 each month and gross monthly income totaling $5,200 each month. What is the maximum qualifying house payment, including principal, interest, taxes and insurance on a conventional loan? Choose only ONE best answer.

• $590

• $922

• $1,000

• $1,456

You are refinancing a $200,000 mortgage with a prepayment penalty of six months of interest at 6.5%. How much is the prepayment penalty? Choose only ONE best answer.

• $1,083

• $2,500

• $6,500

• $13,000

A borrower reports income of $40,000 from rental properties. How much of that should be considered when applying for a mortgage loan? Choose only ONE best answer.

• $40,000

• $32,000

• $30,000

• $20,000

A borrower is buying a house with a sales price of $200,000 and an LTV of 75%. If he pays two discount points, what is the total cost of the points? Choose only ONE best answer.

• $1,500

• $2,000

• $3,000

• $4,000

A homeowner's house appraises for $125,000. He qualifies for an 85% LTV. He owes $63,000 on his first mortgage and $5,000 on his second mortgage. He would like to refinance his house into one mortgage loan and receive additional cash to pay off other debt. How much cash would be available if his closing costs are $4,200 and are financed in the loan? Choose only ONE best answer.

• $34,050

• $38,250

• $43,250

• $52,800