Champions Real Estate Exam Prep National Ch 7 Questions And Answers 100% Correct!

Mortgage Loans - ANSWERSMost common choice for financing real property. Can be conventional or non-conventional Conventional Loan - ANSWERSNeither federally insured nor guaranteed Non-conventional Loan - ANSWERSFederally insured/guaranteed mortgage loans to encourage ownership (FHA, VA, USDA) Contract for Deed - ANSWERSA means by which the seller passes possession but retains title to the property until the total or a substantial portion of the purchase price is paid. Installment contract. The two parties here are the vendor (owner) and the vendee (buyer). Hypothecation - ANSWERSThe action of pledging real property as security for a debt Promissory Note - ANSWERSA written promise to pay a specified amount of money on demand or at a definite time Lien Theory - ANSWERSWhen mortgage loan is used for purchase of real property, at closing the buyer receives the title and the lender has a lien Title Theory - ANSWERSAt closing the lender receives the title and will hold it until the lien is satisfied or paid off Deed of Trust - ANSWERSUsed instead of a traditional mortgage in Texas. Parties are borrows (trustor), lender (beneficiary), and trustee Power of Sale Clause - ANSWERSAllows for non-judicial foreclosure Trustee (Deed of Trust) - ANSWERSActs in fiduciary relationship with beneficiary, released lien when not is paid or forecloses in the event of default Mortgagor - ANSWERS"Gets the door" - buyer/borrower Mortgagee - ANSWERS"Gets the fee" - lender Primary Market - ANSWERSMarket where consumers go to borrow money (mortgage bankers, mortgage brokers, banks, credit unions) Secondary Market - ANSWERSMarket where lenders go for money. Exists for the purchase and sale of existing mortgages to investors → greater liquidity to residential real estate market Conforming Loans - ANSWERSLoans qualified to be purchased in the secondary market. Meet purchase requirements of Fannie Mae and Freddie Mac Secondary Market Warehousing Agencies - ANSWERSFannie Mae, Freddie Mac, Ginnie Mae Freddie Mac Forms - ANSWERSUsed to ensure loans can be sold in secondary market Fixed-Rate Amortized Loan - ANSWERSEqual, regular payments of principal and interest until loan is repaid Interest Paid In Arrears - ANSWERSPaid at the end of each payment period