Mortgage Loan Origination - CompuCram - Mortgage
Loan Origination Activities: Questions & Answers
The maximum amount guaranteed for a VA loan
A.) Cannot exceed $144,000
B.) Depends on the interest rate
C.) Is set by the lender
D.) Varies by the amount of the entitlement an eligible veteran has Right
Ans - D.) Varies by the amount of the entitlement an eligible veteran has
The VA sets a maximum guarantee amount, known as the entitlement, which
determines how much guarantee assistance a veteran can get on a VA loan.
ID: 2960
The Uniform Residential Appraisal Report is used for all of these properties
EXCEPT
A.) Single-family new construction
B.) Single-family homes
C.) Individual units in a PUD
D.) Condominiums Right Ans - D.) Condominiums
The URAR is used for single-family homes, individual units in a planned unit
development (PUD), or other one-family properties. This form is not designed
for appraising condominiums, cooperative units, or multi-family investment
properties.
ID: 2965
Generally speaking, a borrower who gets an FHA loan is expected to make the
property his or her primary residence for at least
A.) 6 months
B.) 12 months
C.) 24 months
D.) Until the loan is paid down to 80% LTV Right Ans - B.) 12 months
,FHA loans require that borrowers occupy the property as their principal
residence for at least 12 months, although there are some exceptions, for
example if the borrower is transferred for work.
ID: 2961
What is the basic entitlement available to veterans for a VA loan?
A.) $78,000
B.) $36,000
C.) $144,000
D.) $55,000 Right Ans - B.) $36,000
All eligible veterans receive $36,000 of basic entitlement, or maximum
guarantee amount.
2981
Qualifying guidelines on an FHA loan are
A.) 31% housing ratio and 43% total debt to income ratio
B.) 29% housing ratio and 41% total income ratio
C.) 28% housing ratio and 36% total debt to income ratio
D.) 36% hosing ratio and 41% total debt to income ratio Right Ans - A.)
31% housing ratio and 43% total debt to income ratio
FHA loans require income ratios of 31% for housing expenses and 43% for
debt to income ratio but can be exceeded with compensating factors.
ID: 2940
Section 502 loans are a program of which government entity?
A.) Federal Housing Administration
B.) Housing and Urban Development
C.) USDA Rural Development
D.) Veterans Administration Right Ans - C.) USDA Rural Development
,The USDA Section 502 loan program either guarantees loans made by
approved private lenders or makes direct loans. Also known as the Section
502 Direct Loan Program, this program assists low- and very-low-income
applicants obtain decent, safe and sanitary housing in eligible rural areas by
providing payment assistance to increase an applicant's repayment ability.
Payment assistance is a type of subsidy that reduces the mortgage payment
for a short time. The amount of assistance is determined by the adjusted
family income.
ID: 2943
The loan amount (principal) is $50,000 and the annual interest paid is $5,500.
What is the annual interest rate?
A.) 9%
B.) 10%
C.) 11%
D.) 12% Right Ans - C.) 11%
To calculate the interest rate, you take the annual interest amount paid
($5,500) and divide by the loan amount ($50,000).
ID: 2958
The UFMIP is charged on what type of mortgage loans?
A.) VA loans
B.) Subprime loans sold to FNMA
C.) Conforming loans sold to GNMA
D.) FHA Loans Right Ans - D.) FHA Loans
ID: 2964
The title insurance protects a title and the process of the closing against risk of
defects, forgeries, and errors that occur during what time period?
A.) From the time the land was first registered to the time of closing
B.) Three months before the closing and three months after
, C.) From the time of closing till the next transfer of title
D.) Ten years before the closing to ten years after Right Ans - A.) From the
time the land was first registered to the time of closing
ID: 2963
The value of an improvement is equal to
A.) What it actually contributes in value to that piece of real estate
B.) Only what the owner spent on materials necessary to make the
improvement
C.) The amount the owner adds to the selling price of the home when the
improvement is made
D.) What it actually cost to mane the improvement in both materials and labor
Right Ans - A.) What it actually contributes in value to that piece of real estate
A particular item or feature of a property is only worth what it actually
contributes in value to that piece of real estate.
ID: 2967
What is required only of a borrower applying for a VA loan in order to
complete the loan application?
A.) Credit bureau report
B.) RESPA guidelines
C.) Purchase sale agreement
D.) Certification of eligibility and discharge papers Right Ans - D.)
Certification of eligibility and discharge papers
A potential borrower who is applying for a VA loan will need a certificate of
eligibility and discharge papers to complete the loan application. ACE is an
automated system used by lenders to obtain an online certificate of eligibility.
The DD214 is needed to obtain the COE.
ID: 2980
Loan Origination Activities: Questions & Answers
The maximum amount guaranteed for a VA loan
A.) Cannot exceed $144,000
B.) Depends on the interest rate
C.) Is set by the lender
D.) Varies by the amount of the entitlement an eligible veteran has Right
Ans - D.) Varies by the amount of the entitlement an eligible veteran has
The VA sets a maximum guarantee amount, known as the entitlement, which
determines how much guarantee assistance a veteran can get on a VA loan.
ID: 2960
The Uniform Residential Appraisal Report is used for all of these properties
EXCEPT
A.) Single-family new construction
B.) Single-family homes
C.) Individual units in a PUD
D.) Condominiums Right Ans - D.) Condominiums
The URAR is used for single-family homes, individual units in a planned unit
development (PUD), or other one-family properties. This form is not designed
for appraising condominiums, cooperative units, or multi-family investment
properties.
ID: 2965
Generally speaking, a borrower who gets an FHA loan is expected to make the
property his or her primary residence for at least
A.) 6 months
B.) 12 months
C.) 24 months
D.) Until the loan is paid down to 80% LTV Right Ans - B.) 12 months
,FHA loans require that borrowers occupy the property as their principal
residence for at least 12 months, although there are some exceptions, for
example if the borrower is transferred for work.
ID: 2961
What is the basic entitlement available to veterans for a VA loan?
A.) $78,000
B.) $36,000
C.) $144,000
D.) $55,000 Right Ans - B.) $36,000
All eligible veterans receive $36,000 of basic entitlement, or maximum
guarantee amount.
2981
Qualifying guidelines on an FHA loan are
A.) 31% housing ratio and 43% total debt to income ratio
B.) 29% housing ratio and 41% total income ratio
C.) 28% housing ratio and 36% total debt to income ratio
D.) 36% hosing ratio and 41% total debt to income ratio Right Ans - A.)
31% housing ratio and 43% total debt to income ratio
FHA loans require income ratios of 31% for housing expenses and 43% for
debt to income ratio but can be exceeded with compensating factors.
ID: 2940
Section 502 loans are a program of which government entity?
A.) Federal Housing Administration
B.) Housing and Urban Development
C.) USDA Rural Development
D.) Veterans Administration Right Ans - C.) USDA Rural Development
,The USDA Section 502 loan program either guarantees loans made by
approved private lenders or makes direct loans. Also known as the Section
502 Direct Loan Program, this program assists low- and very-low-income
applicants obtain decent, safe and sanitary housing in eligible rural areas by
providing payment assistance to increase an applicant's repayment ability.
Payment assistance is a type of subsidy that reduces the mortgage payment
for a short time. The amount of assistance is determined by the adjusted
family income.
ID: 2943
The loan amount (principal) is $50,000 and the annual interest paid is $5,500.
What is the annual interest rate?
A.) 9%
B.) 10%
C.) 11%
D.) 12% Right Ans - C.) 11%
To calculate the interest rate, you take the annual interest amount paid
($5,500) and divide by the loan amount ($50,000).
ID: 2958
The UFMIP is charged on what type of mortgage loans?
A.) VA loans
B.) Subprime loans sold to FNMA
C.) Conforming loans sold to GNMA
D.) FHA Loans Right Ans - D.) FHA Loans
ID: 2964
The title insurance protects a title and the process of the closing against risk of
defects, forgeries, and errors that occur during what time period?
A.) From the time the land was first registered to the time of closing
B.) Three months before the closing and three months after
, C.) From the time of closing till the next transfer of title
D.) Ten years before the closing to ten years after Right Ans - A.) From the
time the land was first registered to the time of closing
ID: 2963
The value of an improvement is equal to
A.) What it actually contributes in value to that piece of real estate
B.) Only what the owner spent on materials necessary to make the
improvement
C.) The amount the owner adds to the selling price of the home when the
improvement is made
D.) What it actually cost to mane the improvement in both materials and labor
Right Ans - A.) What it actually contributes in value to that piece of real estate
A particular item or feature of a property is only worth what it actually
contributes in value to that piece of real estate.
ID: 2967
What is required only of a borrower applying for a VA loan in order to
complete the loan application?
A.) Credit bureau report
B.) RESPA guidelines
C.) Purchase sale agreement
D.) Certification of eligibility and discharge papers Right Ans - D.)
Certification of eligibility and discharge papers
A potential borrower who is applying for a VA loan will need a certificate of
eligibility and discharge papers to complete the loan application. ACE is an
automated system used by lenders to obtain an online certificate of eligibility.
The DD214 is needed to obtain the COE.
ID: 2980
