Deck 13: Loan Origination, Processing, and Closing

Question 1

The following is NOT considered a stage in the appraisal process:

A) ordering the appraisal
B) signing the appraisal
C) monitoring the appraisal
D) evaluating the appraisal

Answer 1

signing the appraisal

Question 2

13-16.A deed conveys:

A) Title to the property from the buyer to the seller
B) identification of the sellers as the grantees who are the same as the owners-of-record
C) title to the property from the seller to the buyer
D) none of the above

Answer 2

title to the property from the seller to the buyer

Question 3

13-13.In verification of a loan,the lender:

A) will have to verify the existence and worth of other assets
B) will require at least a two-year history of income from all sources
C) will verify the credit standing of the applicant
D) all the above
E) both a and c

Answer 3

all the above

Question 4

13-12.Besides physical characteristics,the review appraiser examines:

A) location
B) time of the market
C) financing
D) all of the above
E) none of the above

Question 5

FIRREA mandates:

A) that State-Certified or licensed appraisers must be used for the appraisal of properties involving federally related mortgage transactions after July 1,1991.
B) that State-Certified or licensed appraisers must be used for the appraisal of properties involving federally related mortgage transactions before July 1,1991.
C) that State-Certified or licensed appraisers must be used for the appraisal of properties involving state related mortgage transactions before July 1,1991.
D) none of the above

Question 6

13-18.The origination,servicing,and sale of mortgage loans by a firm or individual is:

A) mortgage insurance payment
B) mortgage banking
C) desk review
D) recording

Question 7

Flood insurance is required for properties located in:

A) zone A
B) zone B
C) zone C
D) zone D

Question 8

13-19.For mortgage bankers two principal sources of funds are:

A) commercial paper and warehousing loans
B) commercial paper and long-term loans
C) short-term loans and mortgage loans
D) none of the above

Question 9

13-10.The following is NOT a step in the cost approach:

A) estimate maximization for the improvement
B) estimate depreciation for the improvement
C) estimate the cost of replacing the improvement
D) estimate the value of land as vacant

Question 10

The utilization of a non-certified or non-licensed appraiser in connection with a federally related mortgage transaction can result in what fine for the first and subsequent violations:

A) $25,000; $50,000
B) $20,000; $40,000
C) $30,000: $45,000
D) $15,000; $30,000

Question 11

13-14.A program under which the lender essentially performs the underwriting program is:

A) verifications of Indebtedness Program
B) loan Processing Program
C) direct Endorsement Program
D) mortgage Banking Program

Question 12

13-17.Recording is necessary to protect the owner against others who may claim to have:

A) a valid deed
B) a senior lien against the property
C) claims in regards to transferring of the property
D) both a and b e both a and c

Question 13

Under the FIRREA,for appraising federally related transactions,each federal regulatory agency establishes:

A) lender guidelines
B) appraisal guidelines
C) state guidelines
D) government guidelines

Question 14

A review appraiser considers several important elements of an appraisal,including:

A) the physical characteristics of the subject property
B) the neighborhood
C) present and alternative land uses
D) all of the above
E) none of the above

Question 15

13-11.The method based on the premise that transaction prices of similar properties in the neighborhood are good indicators of value is:

A) the market approach
B) the income approach
C) the cost approach
D) the prices approach

Question 16

The following is needed in conjunction with a property appraisal for FHANA financing:

A) a loan application.
B) a deed
C) a master certificate of reasonable value d mortgage banker

Question 17

13-15.A promissory note represents:

A) the borrower's promise to obtain the loan
B) the borrower's promise to repay the loan
C) a deed
D) a commitment to be a part of the closing file

Question 18

The method based on the premise that the buyer will not pay more for a property than for a the expense of constructing a comparable property with the same utility is:

A) the market approach
B) the income approach
C) the cost approach
D) the buyer approach

Question 19

13-20.The following is NOT considered in the appraisal of a residential property:

A) HUD identified flood area
B) alternative land use
C) comparable properties
D) net operating income

Question 20

Accepted Appraisal Standards require that the appraiser consider three approaches to the determination of value:

A) cost,market,and income
B) pricing,buying,and selling
C) cost,market,and purchase
D) none of the above

Question 21

13-37.Physical and functional obsolescence may be curable in estimating depreciation when:

A) the value of land is estimated as if it were vacant
B) cost to remedy the obsolescence is not greater than the value added by the repairs
C) the economic obsolescence is external to the property
D) there is a professional appraisal

Question 22

13-39.A document issued upon the closing of the loan and states the loan terms such as amount and payments is referred to as:

A) note
B) endorsement
C) mortgage
D) record

Question 23

13-25.A review appraiser considers several important elements of the appraisal including:

A) the physical characteristics of the subject property
B) the neighborhood of the property
C) present and alternative land uses
D) all of the above
E) none of the above

Question 24

13-34.A deed conveys:

A) title of the property from the seller to the buyer
B) identification of the buyer and the seller
C) both of the above
D) none of the above

Question 25

13-29.The appraisal concept that the best indicator of value is the price of properties of the same quality in the same neighborhood is called:

A) the cost approach
B) the comparable approach
C) the market approach
D) all of the above

Question 26

13-36.The origination,servicing,and sale of mortgage loans is called:

A) mortgage insurance
B) mortgage banking
C) desk review
D) none of the above

Question 27

13-27.The approach based on the idea that a buyer will not pay more for a property than the amount it would take to build it from scratch is:

A) the income approach
B) the cost approach
C) the market approach
D) the scratch approach

Question 28

13-21.The following is required in conjunction with a property appraisal for FHA/VA financing:

A) a loan application
B) a deed
C) a master certificate of reasonable value
D) mortgage banker

Question 29

13-31.In a loan closing the following two related but distinct transactions are completed:

A) buyer allows closing agent to prepare documents and attorney signs release
B) title of the property passes to buyer and attorney signs release
C) buyer signs a promissory note and title to property passes to buyer
D) buyer signs a promissory note and attorney signs release

Question 30

13-24.For VA guaranteed loans,the value established is on an "as-is" value and requires that the veteran acknowledge the condition of the property:

A) at the signing of the loan application
B) during closing
C) within 30 days after closing
D) any time prior to closing

Question 31

13-23.FIRREA mandates:

A) that state certified or licensed appraisers must be used for the appraisal of properties involving federally related mortgages
B) that state certified or licensed appraisers must be used for residential properties with a value in excess of $200,000
C) that state certified or licensed appraisers must be used for the appraisal of commercial properties in excess of $2,000,000
D) that state certified or licensed appraisers must be used for all appraisals of real property

Question 32

13-33.A promissory note represents:

A) the borrower's promise to obtain a loan
B) the borrower's promise to repay a loan
C) a deed
D) the lender's promise to make a loan

Question 33

13-40.A record stating the amounts that are to go to the buyer and seller when a loan is closed is called:

A) note
B) truth-in-lending disclosure
C) settlement statement
D) recording

Question 34

13-22.The following is not considered one of the stages in the appraisal process:

A) ordering an appraisal
B) signing an appraisal
C) monitoring an appraisal
D) evaluating an appraisal

Question 35

13-28.Which of the following is NOT a step in the cost approach to appraising?

A) estimate the net operating income as completed
B) estimate the value of the land as vacant
C) estimate the cost of replacing the structure d estimate the depreciation on current structure

Question 36

13-38.In the event that the contract price exceeds the appraised value of the property: I.the VA will cover the difference.
II)the FFIA will cover the difference.

A) I only
B) II only
C) both I and II
D) neither I nor II

Question 37

13-30.Besides the physical characteristics of the property the review appraiser will consider:

A) location
B) time on the market
C) terms of financing
D) all of the above
E) none of the above

Question 38

13-26.Accepted appraisal standards require that the appraiser consider three approaches to the determination of value:

A) cost,market,and income
B) cost,market,best use
C) cost,income,best use
D) best use,market,income

Question 39

13-35.The record of fees,charges,and payments at the closing is called:

A) commitment
B) truth-in-lending disclosure
C) deed
D) settlement statement

Question 40

13-32.For FHA loans a lender can do virtually all of the underwriting under the:

A) verification of indebtedness program
B) loan processing program
C) direct endorsement program
D) mortgage banking program

Question 41

13-41.Mortgage bankers receive income from: I.marketing rate difference.
II)warehousing rate difference.

A) I only
B) II only
C) both I and II
D) neither I nor II

Question 42

13-42.Under VA government mortgage guarantees,losses are:

A) fully covered
B) partially covered
C) absorbed by the lender
D) guaranteed up to 60 percent of the loss

Question 43

13-43.FHA loans can be refinanced and cash can be obtained on owner occupied properties if the loan as a percent of the acquisition cost is no more than:

A) 50
B) 65
C) 75
D) 85