CHAMPIONS REAL ESTATE FINANCE
COMPREHENSIVE QUESTIONS AND ANSWERS
SURE A+
✔✔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.
✔✔Demand-pull inflation - ✔✔When there is more money in the market and less goods
for sale.
✔✔Cost-push inflation - ✔✔Occurs when the cost of production and offering services
increase, thereby causing manufacturers and tradespeople/vendors to rais their prices
accordingly.
✔✔Discount rate - ✔✔The interest rate charged member banks that borrow from the
Federal Reserve Systems
✔✔Federal Funds Rate - ✔✔Is the rate that the Federal reserve charges banks for
unsecured loans, most of which are for a very short term.
✔✔Trouble Asset Relief Program (TARP) - ✔✔Was created to restore the nations
financial stability and restart economic growth.
✔✔United State Mint - ✔✔Created by Congress in 1972 and became part of the
Department of the Treasury in 1873. The primary mission is to serve the American
people by manufacturing, distributing, and circulating precious metal coins, collecting
coins and national medals. Also entrusted with providing security over assets.
✔✔The Federal Deposit Insurance Corporation (FDIC) - ✔✔An agency created in 1933
to insure individuals' bank accounts, protecting people against losses due to bank
failures (Insures deposits only)
,✔✔The Federal Home Loan Bank (FHLB) System - ✔✔A system of regional banks from
which local lending institutions everywhere in America borrow funds to finance housing,
economic development, infrastructure and jobs.
✔✔The Federal Housing Administration (FHA) - ✔✔Provides mortgage insurance on
loans made by blank- approved lenders throughout the US and its territories. Insures
mortgages on single-family and multifamily homes including manufactured homes and
hospitals. It is the largest insurer of mortgages in the world, insuring over 34 million
properties since its inception in 1934.
✔✔FHA mortgage insurance - ✔✔Provides lenders with protection against losses as the
result of homeowners defaulting on their mortgage loans.
✔✔Community Development Block Grants (CDBG) - ✔✔To help communities with
economic development, job opportunities and housing rehabilitation
✔✔HOME Investment Partnership Program - ✔✔Block grants to develop and support
affordable housing for low-income residents.
✔✔Rental assistance - ✔✔In the form of section 8 certificates or vouchers for low-
income households.
✔✔Ginnie Mae (GNMA) - ✔✔Was established in the U.S in 1968 to promote
homeownership. It is wholly-owned government association that operates a mortgage-
backed securities program designed to facilitate the flow of capital into housing industry.
Does not issue, sell or buy pass-through mortgage-backed securities or purchases
mortgages loans. It simply guarantees (insures).
✔✔Federal Fair Housing Act of 1968 - ✔✔An act prohibiting discrimination in the sale or
rental of housing on the basis of race, color, religion or national origin sex, handicap and
familial status.
✔✔Department of Housing and Urban Development (HUD) - ✔✔A federal cabinet
department is active in national housing programs. Its mission is to create strong,
sustainable, inclusive communities and quality affordable homes. It prevents housing
discrimination through public education and enforcement are administered by the
Assistant Secretary for Fair Housing and Equal Opportunity (FHEO)
✔✔NMLSR - ✔✔All residential mortgage loan originators must now be registered with
the Nationwide Mortgage Licensing System and Registry.
✔✔Consumer Financial Protection Bureau (CFPB) - ✔✔Established by the Dodd-Frank
Act. The Bureau has the authority to examine and enforce consumer protection
, regulations for all mortgage-related businesses, large non-bank financial companies,
and banks and credit unions with assets greater than $10 billion.
✔✔Redlining - ✔✔A practice in which banks refuse to make loans to people living in
certain geographic locations.
✔✔Equal Credit Opportunity Act (ECOA) - ✔✔The federal law that prohibits
discrimination in the extension of credit because of race, color, religion, national origin,
sex, age, or marital status. Ensures that all consumers are given an equal chance to
obtain credit.
✔✔Truth in Lending Act (TILA) - ✔✔A United States federal law that is designed to
protect consumers in any credit transactions by requiring clear disclosure of key terms
of lending arrangments all associated cost.
✔✔Trigger Terms - ✔✔Specific credit terms that may not be advertised unless the
advertisement includes other detailed information.
✔✔The Federal Fair Credit Reporting Act (FCRA) - ✔✔Sometimes called the Fair Credit
Reporting Dispute Act, is a federal law designed to protect consumers against unfair
credit reporting practices and protect and credit privacy. To assure the consumer that
these agencies are fair, accurate and exhibit confidentiality in their credit reporting
methods.
✔✔U.S. Department of Agriculture (USDA) - ✔✔Also referred to a "Section 502 loan" is
insured by the U.S. Department of Agriculture. The program offers 100% financing (no
down payment) for qualified borrowers. First time and repeat home buyers can obtain
this loan. The program is for primary residence only; no second homes or investor
financing is available under this program. The program is for purchases and refinancing
only and cash-out refinances are Not allowed.
✔✔USDA Farm Loans (FSA) - ✔✔Is an agency of the US Dept of Agriculture. Farm
Loan Programs for a farmer or rancher who is unable to obtain credit elsewhere to start,
purchase, sustain, or expand a family farm.
✔✔Office of Consumer Credit Commissioner (OCCC) - ✔✔Regulates the credit industry
and educates consumers and creditors. Agency efforts help produce a fair, lawful and
healthy credit environment for social and economic prosperity in Texas.
✔✔Texas Department of Housing and Community Affairs (TDHCA) - ✔✔Is responsible
for affordable housing, housing related and community service programs, and the
regulation of the states manufactured housing industry.
COMPREHENSIVE QUESTIONS AND ANSWERS
SURE A+
✔✔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.
✔✔Demand-pull inflation - ✔✔When there is more money in the market and less goods
for sale.
✔✔Cost-push inflation - ✔✔Occurs when the cost of production and offering services
increase, thereby causing manufacturers and tradespeople/vendors to rais their prices
accordingly.
✔✔Discount rate - ✔✔The interest rate charged member banks that borrow from the
Federal Reserve Systems
✔✔Federal Funds Rate - ✔✔Is the rate that the Federal reserve charges banks for
unsecured loans, most of which are for a very short term.
✔✔Trouble Asset Relief Program (TARP) - ✔✔Was created to restore the nations
financial stability and restart economic growth.
✔✔United State Mint - ✔✔Created by Congress in 1972 and became part of the
Department of the Treasury in 1873. The primary mission is to serve the American
people by manufacturing, distributing, and circulating precious metal coins, collecting
coins and national medals. Also entrusted with providing security over assets.
✔✔The Federal Deposit Insurance Corporation (FDIC) - ✔✔An agency created in 1933
to insure individuals' bank accounts, protecting people against losses due to bank
failures (Insures deposits only)
,✔✔The Federal Home Loan Bank (FHLB) System - ✔✔A system of regional banks from
which local lending institutions everywhere in America borrow funds to finance housing,
economic development, infrastructure and jobs.
✔✔The Federal Housing Administration (FHA) - ✔✔Provides mortgage insurance on
loans made by blank- approved lenders throughout the US and its territories. Insures
mortgages on single-family and multifamily homes including manufactured homes and
hospitals. It is the largest insurer of mortgages in the world, insuring over 34 million
properties since its inception in 1934.
✔✔FHA mortgage insurance - ✔✔Provides lenders with protection against losses as the
result of homeowners defaulting on their mortgage loans.
✔✔Community Development Block Grants (CDBG) - ✔✔To help communities with
economic development, job opportunities and housing rehabilitation
✔✔HOME Investment Partnership Program - ✔✔Block grants to develop and support
affordable housing for low-income residents.
✔✔Rental assistance - ✔✔In the form of section 8 certificates or vouchers for low-
income households.
✔✔Ginnie Mae (GNMA) - ✔✔Was established in the U.S in 1968 to promote
homeownership. It is wholly-owned government association that operates a mortgage-
backed securities program designed to facilitate the flow of capital into housing industry.
Does not issue, sell or buy pass-through mortgage-backed securities or purchases
mortgages loans. It simply guarantees (insures).
✔✔Federal Fair Housing Act of 1968 - ✔✔An act prohibiting discrimination in the sale or
rental of housing on the basis of race, color, religion or national origin sex, handicap and
familial status.
✔✔Department of Housing and Urban Development (HUD) - ✔✔A federal cabinet
department is active in national housing programs. Its mission is to create strong,
sustainable, inclusive communities and quality affordable homes. It prevents housing
discrimination through public education and enforcement are administered by the
Assistant Secretary for Fair Housing and Equal Opportunity (FHEO)
✔✔NMLSR - ✔✔All residential mortgage loan originators must now be registered with
the Nationwide Mortgage Licensing System and Registry.
✔✔Consumer Financial Protection Bureau (CFPB) - ✔✔Established by the Dodd-Frank
Act. The Bureau has the authority to examine and enforce consumer protection
, regulations for all mortgage-related businesses, large non-bank financial companies,
and banks and credit unions with assets greater than $10 billion.
✔✔Redlining - ✔✔A practice in which banks refuse to make loans to people living in
certain geographic locations.
✔✔Equal Credit Opportunity Act (ECOA) - ✔✔The federal law that prohibits
discrimination in the extension of credit because of race, color, religion, national origin,
sex, age, or marital status. Ensures that all consumers are given an equal chance to
obtain credit.
✔✔Truth in Lending Act (TILA) - ✔✔A United States federal law that is designed to
protect consumers in any credit transactions by requiring clear disclosure of key terms
of lending arrangments all associated cost.
✔✔Trigger Terms - ✔✔Specific credit terms that may not be advertised unless the
advertisement includes other detailed information.
✔✔The Federal Fair Credit Reporting Act (FCRA) - ✔✔Sometimes called the Fair Credit
Reporting Dispute Act, is a federal law designed to protect consumers against unfair
credit reporting practices and protect and credit privacy. To assure the consumer that
these agencies are fair, accurate and exhibit confidentiality in their credit reporting
methods.
✔✔U.S. Department of Agriculture (USDA) - ✔✔Also referred to a "Section 502 loan" is
insured by the U.S. Department of Agriculture. The program offers 100% financing (no
down payment) for qualified borrowers. First time and repeat home buyers can obtain
this loan. The program is for primary residence only; no second homes or investor
financing is available under this program. The program is for purchases and refinancing
only and cash-out refinances are Not allowed.
✔✔USDA Farm Loans (FSA) - ✔✔Is an agency of the US Dept of Agriculture. Farm
Loan Programs for a farmer or rancher who is unable to obtain credit elsewhere to start,
purchase, sustain, or expand a family farm.
✔✔Office of Consumer Credit Commissioner (OCCC) - ✔✔Regulates the credit industry
and educates consumers and creditors. Agency efforts help produce a fair, lawful and
healthy credit environment for social and economic prosperity in Texas.
✔✔Texas Department of Housing and Community Affairs (TDHCA) - ✔✔Is responsible
for affordable housing, housing related and community service programs, and the
regulation of the states manufactured housing industry.
