CHAMPIONS REAL ESTATE FINANCE
PROFESSIONAL INVESTMENT PREP
QUESTIONS AND ACCURATE ANSWERS
GRADED A+
●● Blanket Mortgage
Answer: mortgage covering more than one parcel of real estate
●● Package Mortgage
Answer: Mortgage covering both real and personal property
●● Budget Mortgage
Answer: A mortgage with payment that covers principal and interest,
plus taxes, fire insurance, lease rent, etc.
●● Wraparound Mortgage
Answer: Method of financing which preserves the low, existing interest
rate on the original note.
●● Open-End Mortgage
Answer: mortgage that provides possibility for further borrowing on the
same note and mortgage
,●● Closed-End Mortgage (HELOC)
Answer: mortgage that has a specific dollar amount and does not allow
for additional borrowing on the same note and mortgage - traditional
●● Seller Financing
Answer: a note accepted by a seller instead of cash
●● Types of Refinancing:
Answer: Regular (Rate/Term) or Cash-Out
●● PMI
Answer: Private Mortgage Insurance
●● Private Mortgage Insurance (PMI)
Answer: a special policy that protects the lender in case the buyer cannot
make payments or cannot make them on time
●● LTV
Answer: Loan-to-Value Ratio
●● Subprime Loans
,Answer: loans granted to borrowers with flawed credit histories - no
longer used
●● predatory lending
Answer: Unscrupulous lender takes advantage of a consumer's lack of
knowledge regarding lending practices.
●● Types of Mortgage Fraud
Answer: Fraud for Housing, Fraud for profit, Criminal Purposes
(money/drug laundering)
●● churning
Answer: excessive buying and selling of securities to generate
commissions
●● Chunking
Answer: fraudsters promise to show investors how to get rich fast by
buying investment properties.
●● Equity Theft
Answer: fraudsters forge a deed transfer or a satisfaction lien, and then
obtain new liens on the property.
●● foreclosure rescue scams
, Answer: a homeowner is deceived into signing over title to the property
with the belief that he or she will be able to remain in the house as a
renter and eventually buy it back
●● Property Flipping
Answer: the process of buying properties, renovating them to some
degree, and reselling them with the goal of making an inflated profit due
to an inflated appraisal and mortgage loan
●● Straw Buyer
Answer: someone who agrees to use their personal information to buy
the home to conceal the actual owner
●● FHA, VA, USDA
Answer: Types of government loans
●● Federal Housing
Answer: established in 1943, insurance program that protects the lender
from default by the borrower.
●● 203b
Answer: Most commonly used FHA loan program 1 to 4 family
residence
PROFESSIONAL INVESTMENT PREP
QUESTIONS AND ACCURATE ANSWERS
GRADED A+
●● Blanket Mortgage
Answer: mortgage covering more than one parcel of real estate
●● Package Mortgage
Answer: Mortgage covering both real and personal property
●● Budget Mortgage
Answer: A mortgage with payment that covers principal and interest,
plus taxes, fire insurance, lease rent, etc.
●● Wraparound Mortgage
Answer: Method of financing which preserves the low, existing interest
rate on the original note.
●● Open-End Mortgage
Answer: mortgage that provides possibility for further borrowing on the
same note and mortgage
,●● Closed-End Mortgage (HELOC)
Answer: mortgage that has a specific dollar amount and does not allow
for additional borrowing on the same note and mortgage - traditional
●● Seller Financing
Answer: a note accepted by a seller instead of cash
●● Types of Refinancing:
Answer: Regular (Rate/Term) or Cash-Out
●● PMI
Answer: Private Mortgage Insurance
●● Private Mortgage Insurance (PMI)
Answer: a special policy that protects the lender in case the buyer cannot
make payments or cannot make them on time
●● LTV
Answer: Loan-to-Value Ratio
●● Subprime Loans
,Answer: loans granted to borrowers with flawed credit histories - no
longer used
●● predatory lending
Answer: Unscrupulous lender takes advantage of a consumer's lack of
knowledge regarding lending practices.
●● Types of Mortgage Fraud
Answer: Fraud for Housing, Fraud for profit, Criminal Purposes
(money/drug laundering)
●● churning
Answer: excessive buying and selling of securities to generate
commissions
●● Chunking
Answer: fraudsters promise to show investors how to get rich fast by
buying investment properties.
●● Equity Theft
Answer: fraudsters forge a deed transfer or a satisfaction lien, and then
obtain new liens on the property.
●● foreclosure rescue scams
, Answer: a homeowner is deceived into signing over title to the property
with the belief that he or she will be able to remain in the house as a
renter and eventually buy it back
●● Property Flipping
Answer: the process of buying properties, renovating them to some
degree, and reselling them with the goal of making an inflated profit due
to an inflated appraisal and mortgage loan
●● Straw Buyer
Answer: someone who agrees to use their personal information to buy
the home to conceal the actual owner
●● FHA, VA, USDA
Answer: Types of government loans
●● Federal Housing
Answer: established in 1943, insurance program that protects the lender
from default by the borrower.
●● 203b
Answer: Most commonly used FHA loan program 1 to 4 family
residence
