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WorksheetsReal Estate Principles Unit 9 multiple choice 2
Total questions: 25
Worksheet time: 13mins
A promissory note
Is security for a trust deed
Is evidence of a debt
Must be recorded
Is collateral for the loan
All of the following are negotiable instruments except a(n)
Personal check
Promissory note
Installment note
Trust deed securing a promissory note
Which of the following statements is correct, regarding effective interest rate, and nominal interest rate?
The effective interest rate is slightly above the average rate in the marketplace; the nominal interest rate is slightly below
The interest rate is the rate actually paid by the; the nominal interest rate is the rate named in the note
The effective interest rate is the rate named in the contract; the nominal interest rate is the average rate in the market place
None of the above
If the payments on a loan financing, a real estate purchase are insufficient to service the debt, the result will be
A similar balloon payment
Negative amortization
Positive cash flow
Default on the debt
Which of the following will necessarily involve a balloon payment?
Fully amortized loan
Partially amortized loan
Variable rate loan
Fixed rate loan
When compared to a 25-year amortized loan a 30-year amortized loan has
Less interest over the term of the loan
More principal over the term of the loan
Higher monthly payments of principle and interest
Lower monthly payments of principle and interest
Which of the following statements best defines a mortgage loan?
A loan secured by a mortgage on Real Estate
Any means of creating a trusteeship
An unsecured loan, in which the mortgage itself serves as collateral
None of the above
In a deed of trust, the power of sale in the event of default is given from the
Beneficiary to the trustee
Buyer to the seller
Trustor to the trustee
Trustee to the beneficiary
A power of sale or trustees sale for closure of a purchase money deed of trust
Is similar to a court foreclosure
Prohibits a deficiency judgment
Allows for no reinstatement period
Gives the trustor rights of redemption
Mortgages and trust deeds are different in all of the following respects, except
Parties
Security
Statute of limitations
Title
In the case of a contract of sale, the best analogy for the financial relationship of the parties is
Landlord – tenant
Beneficiary – trustor
Optionor – optionee
Grantor – grantee
Adding an acceleration clause to a note would
Not make the note less negotiable
Be of no benefit to the holder
Make the note nonnegotiable
Greatly limit the negotiability of the note
Foreclosure of a deed of trust may be accomplished, either by court action, or by power of sale. Foreclosure by court action.
Is not a remedy available in California
Prohibits a deficiency judgment
Usually establishes a right of redemption period
Is identical to foreclosure by trustee sale
When real property subject to mortgage is foreclosed, judicially the mortgagor may remain in possession of the property for what maximum amount of time after the foreclosure of the sale?
30 days
90 days
180 days
One year
A broker sells a property and negotiates a first loan from a bank and a second loan from a seller. The broker would record a Request for Notice of Default for the protection of the _ loan
Beneficiary of the first
Beneficiary of the second
Trustor of the first
Trustee of the first
Buyer Taylor purchases a home from seller Sanders, and agrees to assume an existing conventional loan. The lender agrees to the assumption and signs a substitution of liability. Under the circumstances
Taylor becomes primarily responsible for the loan, and Sanders remains liable as a surety
Sanders remains primarily responsible for the loan, and Taylor becomes secondarily liable
Sanders is relieved from all liability
The loan may not be secured by a purchase-money deed of trust
The main purpose of the FHA was to
Help the housing market
Promote home ownership by insuring home loans
Raise building standards on a national basis
Provide a source of home-loan funds at low rates
For an FHA insured loan, the interest rate is
Set by market conditions
Set by the FHA
Determined by agreement between the borrower and lender
Set by the borrower only
Rose, a prospective homebuyer asked Steve at ABC Real Estate Brokerage Company to help her get FHA financing. The broker would most likely contact
A mutual mortgage insurer
A Federal Reserve Bank
The Federal Housing Administration
An approved mortgagee
One of the special features of VA financing is that
The down payment cannot exceed 3% of the assessed value
The down payment varies with the property value
The down payment is determined by the CRV
There is no down payment if the selling price does not exceed the CRV
Which of the following statements is not correct regarding land contracts?
The buyer has equitable ownership of the property
The buyer has possession of the property
The seller has legal title of the property
The seller is known as the vendee
A deed of trust and note are given to a seller to finance the purchase of vacant land. The buyer intends to place a short-term construction loan on the land. Such a deed of trust is most likely to include a(n) _ clause
Subrogation
Or more
Subordination
Prepayment
Which of the following is true regarding a hard-money second deed of trust?
It is a real property purchase loan
It has the highest possible lien priority
Though this type of deed, equity in real property is the collateral for a cash down
It cannot be used to purchase personal property
Mike borrowed money from Robert. As security for the loan, Mike gave Robert a trust deed covering six separate parcels of previously unencumbered real property that Mike owned. Such a trust deed would be regarded as a(n) _ trust deed
Blanket
Subordinated
All-inclusive
Purchase-money
Which of the following terms are most nearly identical?
Take out loan/deficit financing
Take out loan/interim loan
Construction loan/take–out loan
Construction loan/interim loan
