Champions Real Estate Finance Comprehensive Resource To Help You Ace 2026-2027 Exams
Includes Frequently Tested Questions With ELABORATED 100% Correct COMPLETE SOLUTIONS
Guaranteed Pass First Attempt!! Current Update!!
The percentage of the lesser of the appraised value or
sales price that the lender will lend.
Loan-to-Value Ratio (LTV)
ex: If a borrower is approved for an 80% loan, it means
that the lender will loan up to 80% of the sales price or
appraised value, whichever is lower.
Includes both real and personal property ( fixtures and
Package Mortgage
furnishings)
Blanket Mortgage Covers more than one piece of property.
Method of financing which preserves the low, existing
Wraparound Mortgage
interest rate on the original note.
Permits additional borrowing on the same note. This is
Open-End Mortgage sometimes called a credit card mortgage or a home equity
line of credit - HELOC.
The monthly house payment includes principal, interest,
Budget Mortgage
taxes and insurance (known as PITI)
A hard money loan is a specific type of asset-based financ-
Collateral -Dependent Loans ing in which a borrower receives funds secured by the
value of a parcel of real estate.
Is a measure of the willingness of a borrower to make
Character on-time payments. Credit character is revealed in the bor-
rower's credit report.
Is a measure of the borrower's ability to repay the debt,
Capacity and is demonstrated through current earnings and job
stability.
Capital Is the sum of all assets that the borrower has accumulated.
Is something of value that can be pledged as security for
Collateral
repayment.
, Champions Real Estate Finance Comprehensive Resource To Help You Ace 2026-2027 Exams
Includes Frequently Tested Questions With ELABORATED 100% Correct COMPLETE SOLUTIONS
Guaranteed Pass First Attempt!! Current Update!!
Is the return that the investor recieves over the life of the
Yield
loan. (Also known as profit)
The process of creating a new mortgage loan, including all
Originator
steps taken by a lender to attract and qualify a borrower.
Typically functions as a middleman between the borrower
and the lender, negotiating, selling or arranging loans to
Mortgage Broker
be delivered to larger investors. At one time originated up
to 80% of all mortgage loans. (Back on the rise)
Entities which provide their own funds for the purpose of
Mortgage Banker providing mortgage financing, as opposed to commercial
banks/savings associations. (Held, or "Warehoused")
Usually smaller in scale than mortgage bankers or brokers,
Correspondent Lender these lenders typically extend loans with their own funds,
at their own risk.
Once application is complete the file moves into this
Processing
phase.
The detailed process of evaluating a borrower's loan ap-
Underwriting
plication to determine the risk involved for the lender.
The consummation of a real estate transaction in which all
Closing appropriate documents are signed and the proceeds of
the mortgage loan are then disbursed by the lender.
Includes collecting monthly payments, maintaining
records of payments and balances, collecting and paying
Servicing taxes and insurance ( and managing escrow and impound
funds) remitting funds to the note holder, and following
up on delinquencies.
an economic concept that states that the price of a good
Supply and Demand rises and falls depending on how many people want it and
depending on how much of the good is available.
, The process of transferring funds to a title or escrow com-
Funding
pany for disbursement
Designed to enhance consumer protection and reduce
The Safe Act
fraud. (Key component of HERA)
Is defined as the sum of currency held by the public and
M1
transaction deposits at depository institutions.
Is defined as M1 plus saving deposits, small-denomina-
M2 tion time deposits (those issued in amounts of less than
$100,000) and retail money market mutual funds shares.
Fiat Money Is currency that is not backed by any precious metals at all.
Is the maintenance of a stable money supply that provides
for growth in the economy while keeping inflation in. The
Monetary Policy
federal reserves is responsible for this policy in the United
States.
Federal Government spending. Approved by Congress. At
Fiscal Policy the treasury level, funds can be raised to pay for govern-
ment spending by raising taxes and increasing borrowing.
Federal Reserve (The Fed) is the central bank of the United States
Monetary inflation When there is an excess of money supply in the market.
When there is more money in the market and less goods
Demand-pull inflation
for sale.
Occurs when the cost of production and ottering services
Cost-push inflation increase, thereby causing manufacturers and tradespeo-
ple/vendors to rais their prices accordingly.
The interest rate charged member banks that borrow from
Discount rate
the Federal Reserve Systems
Is the rate that the Federal reserve charges banks for
Federal Funds Rate
unsecured loans, most of which are for a very short term.
Includes Frequently Tested Questions With ELABORATED 100% Correct COMPLETE SOLUTIONS
Guaranteed Pass First Attempt!! Current Update!!
The percentage of the lesser of the appraised value or
sales price that the lender will lend.
Loan-to-Value Ratio (LTV)
ex: If a borrower is approved for an 80% loan, it means
that the lender will loan up to 80% of the sales price or
appraised value, whichever is lower.
Includes both real and personal property ( fixtures and
Package Mortgage
furnishings)
Blanket Mortgage Covers more than one piece of property.
Method of financing which preserves the low, existing
Wraparound Mortgage
interest rate on the original note.
Permits additional borrowing on the same note. This is
Open-End Mortgage sometimes called a credit card mortgage or a home equity
line of credit - HELOC.
The monthly house payment includes principal, interest,
Budget Mortgage
taxes and insurance (known as PITI)
A hard money loan is a specific type of asset-based financ-
Collateral -Dependent Loans ing in which a borrower receives funds secured by the
value of a parcel of real estate.
Is a measure of the willingness of a borrower to make
Character on-time payments. Credit character is revealed in the bor-
rower's credit report.
Is a measure of the borrower's ability to repay the debt,
Capacity and is demonstrated through current earnings and job
stability.
Capital Is the sum of all assets that the borrower has accumulated.
Is something of value that can be pledged as security for
Collateral
repayment.
, Champions Real Estate Finance Comprehensive Resource To Help You Ace 2026-2027 Exams
Includes Frequently Tested Questions With ELABORATED 100% Correct COMPLETE SOLUTIONS
Guaranteed Pass First Attempt!! Current Update!!
Is the return that the investor recieves over the life of the
Yield
loan. (Also known as profit)
The process of creating a new mortgage loan, including all
Originator
steps taken by a lender to attract and qualify a borrower.
Typically functions as a middleman between the borrower
and the lender, negotiating, selling or arranging loans to
Mortgage Broker
be delivered to larger investors. At one time originated up
to 80% of all mortgage loans. (Back on the rise)
Entities which provide their own funds for the purpose of
Mortgage Banker providing mortgage financing, as opposed to commercial
banks/savings associations. (Held, or "Warehoused")
Usually smaller in scale than mortgage bankers or brokers,
Correspondent Lender these lenders typically extend loans with their own funds,
at their own risk.
Once application is complete the file moves into this
Processing
phase.
The detailed process of evaluating a borrower's loan ap-
Underwriting
plication to determine the risk involved for the lender.
The consummation of a real estate transaction in which all
Closing appropriate documents are signed and the proceeds of
the mortgage loan are then disbursed by the lender.
Includes collecting monthly payments, maintaining
records of payments and balances, collecting and paying
Servicing taxes and insurance ( and managing escrow and impound
funds) remitting funds to the note holder, and following
up on delinquencies.
an economic concept that states that the price of a good
Supply and Demand rises and falls depending on how many people want it and
depending on how much of the good is available.
, The process of transferring funds to a title or escrow com-
Funding
pany for disbursement
Designed to enhance consumer protection and reduce
The Safe Act
fraud. (Key component of HERA)
Is defined as the sum of currency held by the public and
M1
transaction deposits at depository institutions.
Is defined as M1 plus saving deposits, small-denomina-
M2 tion time deposits (those issued in amounts of less than
$100,000) and retail money market mutual funds shares.
Fiat Money Is currency that is not backed by any precious metals at all.
Is the maintenance of a stable money supply that provides
for growth in the economy while keeping inflation in. The
Monetary Policy
federal reserves is responsible for this policy in the United
States.
Federal Government spending. Approved by Congress. At
Fiscal Policy the treasury level, funds can be raised to pay for govern-
ment spending by raising taxes and increasing borrowing.
Federal Reserve (The Fed) is the central bank of the United States
Monetary inflation When there is an excess of money supply in the market.
When there is more money in the market and less goods
Demand-pull inflation
for sale.
Occurs when the cost of production and ottering services
Cost-push inflation increase, thereby causing manufacturers and tradespeo-
ple/vendors to rais their prices accordingly.
The interest rate charged member banks that borrow from
Discount rate
the Federal Reserve Systems
Is the rate that the Federal reserve charges banks for
Federal Funds Rate
unsecured loans, most of which are for a very short term.
