Champions - Real Estate Finance EXAM 2024 Questions & Answers 100% Correct!

Loan Processing - ANSWERSThe process of collecting information about a borrower in order to build a loan file that will be used to make an underwriting decision. Underwriting - ANSWERSThe process of evaluating a borrower's loan application to determine the risk involved for the lender. Funding - ANSWERSThe process of transferring funds to a title or escrow company for disbursement. Servicing - ANSWERSSending monthly payment statements and collecting monthly payments, maintaining payment records and following up on delinquencies. Origination - ANSWERSThe process of creating a new mortgage loan. Benefits of Home Ownership - ANSWERS• Occupancy - the owner occupies the residence • Tax benefits - mortgage interest and property taxes may be tax deductible • Pride of ownership - many homeowners see the home as a sign of accomplishment • Security - home ownership protects the individual or family from future increases in rental rates • Investment - properties are purchased and held in anticipation of income, appreciation or both An Agent's Role in Mortgage Lending Includes: - ANSWERS• arranging for the pre-qualification/pre-approval of buyers • discussing general mortgage loan programs that buyers might consider • answering finance and closing-related questions • providing buyers with a list of potential lenders • preparing the contract with all terms of sale, including financing conditions • tracking important dates from contract to close, including monitoring the time the buyer has to obtain financing approval Conventional Loans - ANSWERSRefers to a loan made with real estate as security and which does not involve government participation in the form of insuring or guaranteeing the loan. Government Loans - ANSWERSMortgages insured or guaranteed by the US Government. Includes FHA, VA, and USDA loans. Four C's of Good Lending - ANSWERS• Character • Capacity • Capital • Collateral Character - ANSWERSA measure of the willingness of a borrower to make on-time payments. Credit character is revealed in the borrower's credit report. Capacity - ANSWERSA measure of the willingness of a borrower to make on-time payments. Credit character is revealed in the borrower's credit report. Capital - ANSWERSThe sum of all assets that the borrower has accumulated. Saving accounts, investments and other assets demonstrate a level of financial responsibility on the part of the borrower. Collateral - ANSWERSSomething of value that can be pledged as security for repayment of the loan. In a residential transaction, the property being purchased is used