ASREB Exam Prep A-4 (Gray Packet)
Questions With Answers
When a debt will be paid off by making constant level payments, this is called: Amortized
loan
This best describes the purpose of a trustee: Foreclosure in a deed of trust
If a lender is doing business in a lien theory state, this is true: Legal title is held by
mortgagor
When a loan is secured by a deed of trust, who holds the deed of trust document?
Beneficiary
This is NOT part of a deed of trust: Habendum
A buyer is buying a business that includes real and personal property, the type of loan he needs to
obtain is: Package
This is NOT a security instrument: Note
(Security instruments are deed of trust, mortgage, agreement for sale)
, When a lender agrees to change lien positions, this is called: Subordination
An open end loan would: Allow for sums of money to be loaned as a project progresses
When a note and deed of trust are paid in full, the lender is required to issue a release of lien.
This is called: Defeasance
Which of the following liens has a different process than any other lien, and no money has been
loaned? Mechanics lien
Seller of a property has repair work on a home and doesn't pay the contractor. The new buyer
obtains a new FHA loan that is recorded. The contractor files a mechanics lien on the property.
What will happen? The mechanics lien is valid and has priority over the FHA loan
When a homeowner sells their property to a lender but the seller remains in the property and
receives regular payments from the lender this is best defines as: Reverse annuity
These 2 terms are NOT synonymous: Lessee / landlord
This would trigger an alienation clause: Sale of the property
An assignment of rents clause would most likely benefit this party: Beneficiary
Questions With Answers
When a debt will be paid off by making constant level payments, this is called: Amortized
loan
This best describes the purpose of a trustee: Foreclosure in a deed of trust
If a lender is doing business in a lien theory state, this is true: Legal title is held by
mortgagor
When a loan is secured by a deed of trust, who holds the deed of trust document?
Beneficiary
This is NOT part of a deed of trust: Habendum
A buyer is buying a business that includes real and personal property, the type of loan he needs to
obtain is: Package
This is NOT a security instrument: Note
(Security instruments are deed of trust, mortgage, agreement for sale)
, When a lender agrees to change lien positions, this is called: Subordination
An open end loan would: Allow for sums of money to be loaned as a project progresses
When a note and deed of trust are paid in full, the lender is required to issue a release of lien.
This is called: Defeasance
Which of the following liens has a different process than any other lien, and no money has been
loaned? Mechanics lien
Seller of a property has repair work on a home and doesn't pay the contractor. The new buyer
obtains a new FHA loan that is recorded. The contractor files a mechanics lien on the property.
What will happen? The mechanics lien is valid and has priority over the FHA loan
When a homeowner sells their property to a lender but the seller remains in the property and
receives regular payments from the lender this is best defines as: Reverse annuity
These 2 terms are NOT synonymous: Lessee / landlord
This would trigger an alienation clause: Sale of the property
An assignment of rents clause would most likely benefit this party: Beneficiary
