SOMB 1 Practice Test correctly
answered already passed
What is the process of transferring loan documents to a warehouse bank or an investor called? -
correct answer ✔✔Shipping
Which of the following is a responsibility of the underwriter? - correct answer ✔✔Accept or
reject loan applications
Which of the following is a responsibility of the closer? - correct answer ✔✔- conclude a
transaction
- interact with the title and escrow companies
What does the Mortgage Banking Association Canon of Ethics say concerning competition? -
correct answer ✔✔It supports healthy competition in the real estate finance industry
What does the Mortgage Bankers Association Canon of Ethics contain ethical standards
pertaining to? - correct answer ✔✔- Honesty in advertising
- Confidentiality
- Compliance with laws
Factors that affect an investor's appetite for certain loan products? - correct answer ✔✔- Risk of
default or loss
- Exaggerated prepayment speeds
- Costs to service based upon structure
- Risk for potential fraud
- Liquidity
, A jumbo or super jumbo loan is considered to be a ____________________ loan product, while
a loan that is eligible for purchase by Fannie Mae or Freddie Mac is most likely a
_______________ loan product. - correct answer ✔✔Non-comforming; conforming
FHA charges a _____________ to protect lenders in the event the borrower fails to repay the
mortgage loan - correct answer ✔✔Mortgage Insurance Premium (MIP)
The increased number of payments that come with a bi-weekly mortgage results in the
following: - correct answer ✔✔- Total interest cost on the loan is reduced
- Principal amortizes more quickly
- Loan is paid off faster
Adjustable Rate Mortgage characteristics - correct answer ✔✔- Amount of monthly payments
may change when the interest rate adjusts
- ARMs may have an annual and lifetime cap governing how much the interest rate may change
An Alt-A product that does not cause the balance of the loan to decrease and does not build
equity in the home unless the value increases - correct answer ✔✔Interest Only
Wholesale lenders can perfrom - correct answer ✔✔- Underwriting
- Closing
- Funding
Wholesale production is more risky for the mortgage lender because - correct answer ✔✔Loan
quality might be more difficult to monitor
answered already passed
What is the process of transferring loan documents to a warehouse bank or an investor called? -
correct answer ✔✔Shipping
Which of the following is a responsibility of the underwriter? - correct answer ✔✔Accept or
reject loan applications
Which of the following is a responsibility of the closer? - correct answer ✔✔- conclude a
transaction
- interact with the title and escrow companies
What does the Mortgage Banking Association Canon of Ethics say concerning competition? -
correct answer ✔✔It supports healthy competition in the real estate finance industry
What does the Mortgage Bankers Association Canon of Ethics contain ethical standards
pertaining to? - correct answer ✔✔- Honesty in advertising
- Confidentiality
- Compliance with laws
Factors that affect an investor's appetite for certain loan products? - correct answer ✔✔- Risk of
default or loss
- Exaggerated prepayment speeds
- Costs to service based upon structure
- Risk for potential fraud
- Liquidity
, A jumbo or super jumbo loan is considered to be a ____________________ loan product, while
a loan that is eligible for purchase by Fannie Mae or Freddie Mac is most likely a
_______________ loan product. - correct answer ✔✔Non-comforming; conforming
FHA charges a _____________ to protect lenders in the event the borrower fails to repay the
mortgage loan - correct answer ✔✔Mortgage Insurance Premium (MIP)
The increased number of payments that come with a bi-weekly mortgage results in the
following: - correct answer ✔✔- Total interest cost on the loan is reduced
- Principal amortizes more quickly
- Loan is paid off faster
Adjustable Rate Mortgage characteristics - correct answer ✔✔- Amount of monthly payments
may change when the interest rate adjusts
- ARMs may have an annual and lifetime cap governing how much the interest rate may change
An Alt-A product that does not cause the balance of the loan to decrease and does not build
equity in the home unless the value increases - correct answer ✔✔Interest Only
Wholesale lenders can perfrom - correct answer ✔✔- Underwriting
- Closing
- Funding
Wholesale production is more risky for the mortgage lender because - correct answer ✔✔Loan
quality might be more difficult to monitor
