CA DRE EXAM Prep (Chapter 4: Financing)
Questions with Exact Answers 2024.
A second trust deed can be distinguished from a first trust deed by - Correct Answer-the
time and date of recording
Which of the following is true regarding promissory notes? - Correct Answer-They are the
evidence of the debt
Hypothecate means - Correct Answer-to give a thing as security without giving
possession
Who generally benefit the most by a subordination clause in a trust deed? - Correct
Answer-The trustor
Total foreclosure time under a trustee's sale on a trust deed is minimally: - Correct
Answer-Four months
The beneficiary of a trust deed is most likely a - Correct Answer-Bank
A clause in a trust deed calling for an assignment of rents most benefits the - Correct
Answer-beneficiary
On each payment of an amortized loan - Correct Answer-the amount applying to the
principal increases with each payment.
Which of the following are most related to each other? - Correct Answer-points of interest
In the context of mortgage finance, a beneficiary statement is made: - Correct Answer-by
the lender to state the current balance required to pay off a real estate loan
A CalVET buyer finances the property with a - Correct Answer-contract sale
, When the debt has been paid in full, the trustee will record what legal instrument to
remove the lien on a trust deed from the public record? - Correct Answer-Reconveyance
Deed
In a period deflation - Correct Answer-the value of money increases
When the Federal Reserve (the Fed) increases the reserve requirements, referred to as
tight money policy, it will: - Correct Answer-decrease loan activity
If a lender accepts a deed-in-lieu of foreclosure, the lender - Correct Answer-assumes any
junior liens
Gale is the beneficiary of a $1,500,000 deed of trust on a single family home. Frank, the
trustor, made $200,000 in payments before going into default. At the trustee's sale, the
property sold for $1,000,000, resulting in a $300,000 deficiency. In California, a deficiency
judgment cannot be obtained: - Correct Answer--if the security is a purchase money trust
deed.
-if foreclosed through a trustee's sale.
-if the fair market value (FMV) of the property exceeds the amount due on the trust deed.
When a borrower defaults on a loan and the lender initiates judicial foreclosure, the right of
possession to the property is held by the during the redemption period. - Correct Answer-
mortgagor
An owner's right to bring current any monetary or curable default stated in the notice of
default (NOD) prior to five business days before the date of the sale is called: - Correct
Answer-reinstatement
Bruce sold his home for $215,000 to Maria and carried back a $150,000 note with interest
at 6% per annum. The note was secured by a first trust deed. The home had a fair market
value (FMV) of $200,000. Later, Bruce sold the trust deed and note at a discounted price
of $135,000 to Syndi. On the back of the note, Bruce wrote, "I hereby assign the within
note to Syndi without recourse." If Maria defaults before any principal payments are made,
Syndi's best legal remedy is to: - Correct Answer-foreclose to enforce payment of the
$150,000
The power to sell a property in the event of a default under the terms of the trust deed is
given by: - Correct Answer-trustor to the trustee.
Questions with Exact Answers 2024.
A second trust deed can be distinguished from a first trust deed by - Correct Answer-the
time and date of recording
Which of the following is true regarding promissory notes? - Correct Answer-They are the
evidence of the debt
Hypothecate means - Correct Answer-to give a thing as security without giving
possession
Who generally benefit the most by a subordination clause in a trust deed? - Correct
Answer-The trustor
Total foreclosure time under a trustee's sale on a trust deed is minimally: - Correct
Answer-Four months
The beneficiary of a trust deed is most likely a - Correct Answer-Bank
A clause in a trust deed calling for an assignment of rents most benefits the - Correct
Answer-beneficiary
On each payment of an amortized loan - Correct Answer-the amount applying to the
principal increases with each payment.
Which of the following are most related to each other? - Correct Answer-points of interest
In the context of mortgage finance, a beneficiary statement is made: - Correct Answer-by
the lender to state the current balance required to pay off a real estate loan
A CalVET buyer finances the property with a - Correct Answer-contract sale
, When the debt has been paid in full, the trustee will record what legal instrument to
remove the lien on a trust deed from the public record? - Correct Answer-Reconveyance
Deed
In a period deflation - Correct Answer-the value of money increases
When the Federal Reserve (the Fed) increases the reserve requirements, referred to as
tight money policy, it will: - Correct Answer-decrease loan activity
If a lender accepts a deed-in-lieu of foreclosure, the lender - Correct Answer-assumes any
junior liens
Gale is the beneficiary of a $1,500,000 deed of trust on a single family home. Frank, the
trustor, made $200,000 in payments before going into default. At the trustee's sale, the
property sold for $1,000,000, resulting in a $300,000 deficiency. In California, a deficiency
judgment cannot be obtained: - Correct Answer--if the security is a purchase money trust
deed.
-if foreclosed through a trustee's sale.
-if the fair market value (FMV) of the property exceeds the amount due on the trust deed.
When a borrower defaults on a loan and the lender initiates judicial foreclosure, the right of
possession to the property is held by the during the redemption period. - Correct Answer-
mortgagor
An owner's right to bring current any monetary or curable default stated in the notice of
default (NOD) prior to five business days before the date of the sale is called: - Correct
Answer-reinstatement
Bruce sold his home for $215,000 to Maria and carried back a $150,000 note with interest
at 6% per annum. The note was secured by a first trust deed. The home had a fair market
value (FMV) of $200,000. Later, Bruce sold the trust deed and note at a discounted price
of $135,000 to Syndi. On the back of the note, Bruce wrote, "I hereby assign the within
note to Syndi without recourse." If Maria defaults before any principal payments are made,
Syndi's best legal remedy is to: - Correct Answer-foreclose to enforce payment of the
$150,000
The power to sell a property in the event of a default under the terms of the trust deed is
given by: - Correct Answer-trustor to the trustee.
