451 Real Estate Finance 1 Exam UPDATED
QUESTIONS AND CORRECT ANSWERS
An officially-issued legal tender generally consisting of currency and coins is called?
A) Cash
B) Currency
C) Money
D) All the above - CORRECT ANSWER D) All the above
What is the purpose of an acceleration clause?
A) Make an entire loan amount due upon default
B) Penalized borrowers for paying early
C) Reward borrowers for paying early
D) Double the monthly payment amount - CORRECT ANSWER A) Make an entire loan
amount due upon default
Which of the follow statement is TRUE of a VA hybrid ARM?
A) It converts to fixed-rate loans after 3 year
B) It uses the LIBOR as an index
C) It has one-year adjustment periods
,D) I has a 10% lifetime cap - CORRECT ANSWER C) It has one-year adjustment periods
For FHA-insured loans, what is the lender's origination fee limit?
A) 1%
B) 1.25%
C) 1.5%
D) 2% - CORRECT ANSWER A) 1%
A VA loan may be used for all of the following EXCEPT?
A) Purchasing an owner-occupied home
B) Purchasing an investment property
C) Re-financing another VA loan
D) Improving an owner-occupied home - CORRECT ANSWER B) Purchasing an investment
property
Which credit report does Fannie Mae require to be part of the application?
A) A credit report from Equifax
B) A credit report from Experian
C) A credit report from TransUnion
, D) A merged credit report for all of these reports - CORRECT ANSWER D) A merged credit
report for all of these reports
Loan guaranteed by the Veterans Administration (VA) usually require which of the following things?
A) An origination fee
B) A funding fee
C) An underwriting fee
D) A mortgage insurance fee - CORRECT ANSWER B) A funding fee
Hazard insurance covers which one of the following things?
A) Fire
B) Flood
C) Earthquake
D) Death - CORRECT ANSWER A) Fire
Hazard Insurance also know as Homeowners Insurance
If a buyer wants to purchase a property form a seller who currently have a mortgage with an well
bellow the market level, which of the following arrangement would be most beneficial to the
borrower?
A) Assume the seller's mortgage
QUESTIONS AND CORRECT ANSWERS
An officially-issued legal tender generally consisting of currency and coins is called?
A) Cash
B) Currency
C) Money
D) All the above - CORRECT ANSWER D) All the above
What is the purpose of an acceleration clause?
A) Make an entire loan amount due upon default
B) Penalized borrowers for paying early
C) Reward borrowers for paying early
D) Double the monthly payment amount - CORRECT ANSWER A) Make an entire loan
amount due upon default
Which of the follow statement is TRUE of a VA hybrid ARM?
A) It converts to fixed-rate loans after 3 year
B) It uses the LIBOR as an index
C) It has one-year adjustment periods
,D) I has a 10% lifetime cap - CORRECT ANSWER C) It has one-year adjustment periods
For FHA-insured loans, what is the lender's origination fee limit?
A) 1%
B) 1.25%
C) 1.5%
D) 2% - CORRECT ANSWER A) 1%
A VA loan may be used for all of the following EXCEPT?
A) Purchasing an owner-occupied home
B) Purchasing an investment property
C) Re-financing another VA loan
D) Improving an owner-occupied home - CORRECT ANSWER B) Purchasing an investment
property
Which credit report does Fannie Mae require to be part of the application?
A) A credit report from Equifax
B) A credit report from Experian
C) A credit report from TransUnion
, D) A merged credit report for all of these reports - CORRECT ANSWER D) A merged credit
report for all of these reports
Loan guaranteed by the Veterans Administration (VA) usually require which of the following things?
A) An origination fee
B) A funding fee
C) An underwriting fee
D) A mortgage insurance fee - CORRECT ANSWER B) A funding fee
Hazard insurance covers which one of the following things?
A) Fire
B) Flood
C) Earthquake
D) Death - CORRECT ANSWER A) Fire
Hazard Insurance also know as Homeowners Insurance
If a buyer wants to purchase a property form a seller who currently have a mortgage with an well
bellow the market level, which of the following arrangement would be most beneficial to the
borrower?
A) Assume the seller's mortgage
