Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
30 Cards in this Set
- Front
- Back
- 3rd side (hint)
A mortgage is the longest and largest debt most people will ever incur.
|
True
|
|
|
A borrower cannot use mortgaged property until the debt is paid in full.
|
False
|
|
|
Interest rates are usually lower for fixed rate mortgages than for other types.
|
False
|
|
|
A shared application mortgage is another form of consumer loan tied to the apreciated value of a property.
|
False
|
|
|
A larger down payment on a home lowers the cost of the monthly payment.
|
True
|
|
|
Private mortgage insurance protects the lender against lone default; it is not typically required for borrowers whose down payment is 10 percent or greater.
|
False
|
|
|
The first step in the mortgage approval process is documentation.
|
False
|
|
|
The Gramm-Leach-Bliley Act requires that financial institutions protect the privacy of consumers.
|
True
|
|
|
Any escrow surplus of more than $50 must be returned to the borrower.
|
True
|
|
|
Qualifying veterans may get government-backed mortgage loans with low down payments through the Department of Veteran's Affairs.
|
True
|
|
|
Which of the following components of a fixed rate mortgage do not change?
|
all of the following
|
|
|
The rate to which a lender's interest rate is tied is called the
|
index
|
|
|
A point is a value equal to what percent of a mortgage loan?
|
1 percent
|
|
|
A reverse mortgage is repaid
|
when the borrower dies.
|
|
|
Generally speaking, housing costs should not exceed __________ of gross monthly income.
|
25 to 28 percent
|
percent
|
|
The final step of the mortgage approval process is
|
recording
|
|
|
It requires banks to record and report data on home lending in order to identify possible discriminatory patterns.
|
Home Mortgage Disclosure Act
|
|
|
The Real Estate Settlement Procedures Act was enacted
|
to protect consumers from hidden costs at closing time.
|
|
|
Which of the following statements about HOEPA loans is NOT true?
|
Lenders are prohibited from charging an APR that is 10 points higher than a rate on a Treasury Bill.
|
|
|
Today the home ownership rate in the United States is about
|
68 percent
|
percent
|
|
A _________ is a note, usually long term, secured by real property.
|
Mortgage
|
|
|
A fixed rate mortgage is also known as a ___________ mortgage.
|
convential
|
|
|
A type of fixed rate mortgage in which the entire remaining balance of the loan is due in one single large payment is called a ___________ mortgage.
|
balloon
|
|
|
In this kind of mortgage, the borrower prepays part of the interest in order to get a lower rate.
|
buy-down
|
|
|
The difference between what an item is worth and what is owed on it is called
|
Equity
|
|
|
The _________ cap is the specified overall maximum or minimum rate of an ARM, regardless of index.
|
lifetime
|
|
|
_________mortgage insurance (PMI) protects the lender against loan default.
|
Private
|
|
|
The refusal of banks to lend to residents of certain neighborhoods is called
|
redlining
|
|
|
The Federal Home Loan Mortgage Corporation is better known as
|
Freddie Mac
|
|
|
Most lenders require an amount called_________to be paid to them in advance; the lenders pay real estate taxes from this fund.
|
escrow
|
|