REAL 4000 UGA Exam Study Questions and Answers (100% Pass)

REAL 4000 UGA Exam Study Questions and Answers (100% Pass) What does the value of a property mortgage depend on - Answer️️ - 1. Magnitude of expected cash flows 2. Timing of expected cash flows 3. Riskiness of expected cash flows The possibility that the actual outcome will vary from what was expected when the asset was purchased. - Answer️️ -Risk fixed amount of money paid or received at the end of every period - Answer️️ -Ordinary annuity future cash inflow or outflow occurring only once - Answer️️ -lump sum payment What are the four time Value of money operations - Answer️️ - Compounding Operations 1. Future value of a lump sum 2. Future value of an annuity Discounting Operation ©SOPHIABENNET@2024/2025 Wednesday, August 21, 2024 12:13 PM UNIVERSITY OF NORTH TEXAS AT DALLAS UNIVERSITY OF GEORGIA (UGA) 2 1. Present value of a lump sum 2.Present value of an annuity What affects value - Answer️️ -required yield What is the highest degree of control you can have - Answer️️ - Purchase price loans for which the interest rate does not change over the life of the loan - Answer️️ -Fixed rate more common when rates in the market are not stable as they protect lender from interest rate risk - Answer️️ -adjustable rate Why would you take an adjustable rate? - Answer️️ -it allows the borrower to secure lower rates for the short term Two elements of a mortgage loan - Answer️️ -1. The note 2. The mortgage exact terms of financial obligation 1. Where financial terms are discussed 2. Interest rate 3.Fixed rate 4.Amortization - Answer️️ -The Note ©SOPHIABENNET@2024/2025 Wednesday, August 21, 2024 12:13 PM UNIVERSITY OF NORTH TEXAS AT DALLAS UNIVERSITY OF GEORGIA (UGA) 3 A pledge of property as a security for the note. Formal conveyance of rights to disposition - Answer️️ -The mortgage (DOT) Various arrangements for fixed-rate loan - Answer️️ -1. Fully Amortized 2. Partially Amortized 3. Interest only 4. Negative Amortization Fully amortized - Answer️️ -Most Residential Consumer Real Estate Loans Partially amortized - Answer️️ -1. Most commercial Real Estate loans 2. Term for amortization 3. Term to maturity (paid off before amortization term) Interest only (NON AMORTIZING sometimes called a bullet loan) - Answer️️ -1. balloon payment at tend UNLESS converting to amort loan 2. Mostly commercial but sometimes residential loans ©SOPHIABENNET@2024/2025 Wednesday, August 21, 2024 12:13 PM UNIVERSITY OF NORTH TEXAS AT DALLAS UNIVERSITY OF GEORGIA (UGA) 4 Negative amortization ( principal rising, not falling) - Answer️️ - purposeful in reverse mortgage The Note: Prepayment - Answer️️ - Right of prepayment unless explicitly prohibited - Answer️️ - Modern statutory case Loans with FULL right of payment - Answer️️ -1. All conforming and FHA/VA loans 2. Home equity credit lines 3. Most some non conforming loans - subprime home loans (less than 669 credit score) -Jumbo home loans (647200 and above for all GA countries) Loans with RESTRICTED right of payment - Answer️️ -1. Most commercial real estate loans 2. Some subprime and jumbo a lender had to take a house from you and they cannot sell it for as much as you owe them they can take your assets - Answer️