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CHAMPIONS SCHOOL OF REAL
ESTATE FINANCE LATES T
UPDATE EXAM 75 QUEST IONS
WITH 100% VERIFIED CORRECT
ANSWERS GUARANTEED A +
Question 1: The process of collecting information about a
borrower in order to build a loan file that will be used to
make an underwriting decision is known as:
CORRECT ANSWER: Loan processing
Question 2: The process of evaluating a borrower's loan
application to determine the risk involved for the lender is
known as:
CORRECT ANSWER: Underwriting
Question 3: The process of transferring funds to a title or
escrow company for disbursement is known as:
CORRECT ANSWER: Funding
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Question 4: Sending monthly payment statements and
collecting monthly payments, maintaining payment
records and following up on delinquencies is known as:
CORRECT ANSW ER: Servicing
Question 5: The process of creating a new mortgage loan
is known as:
CORRECT ANSWER: Origination
Question 6: Character is a measure of the willingness of a
borrower to make on-time payments. Credit character is revealed in the borrower's credit report. This is referred to
as:
CORRECT ANSWER: Character
Question 7: Capacity is a measure of the borrower's
ability to repay the debt, and is demonstrated through current earnings and job stability. The lender is concerned with both the quantity of income and its stability. In determining capacity, the lender must weigh the
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borrower's income against his or her current debt. This is
referred to as:
CORRECT ANSWER: Capacity
Question 8: Capital is the sum of all assets that the
borrower has accumulated. Savings accounts, investments and other assets demonstrate a level of financial responsibility on the part of the borrower. This is referred
to as:
CORRECT ANSWER: Capital
Question 9: Collateral is something of value that can be
pledged as security for repayment of the loan. In a residential transaction, the property being purchased is used as security for the debt. The sufficiency of collateral is determined through an appraisal of the property. This is
referred to as:
CORRECT ANSWER: Collateral
Question 10: The rate and discount points charged on a
loan are a function of many factors, including the
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prevailing rates in the market, the type of property being financed, the term of the loan, and the borrower's credit,
income and down payment. This is referred to as:
CORRECT ANSWER: Rate and discount points
Question 11: The process of creating a new mortgage
loan, including all steps taken by a lender to attract and
qualify a borrower, are considered:
CORRECT ANSWER: Origination activities
Question 12: Typically functions as a middleman between
the borrower and the lender, negotiating, selling or arranging loans to be delivered to larger investors. This is
referred to as:
CORRECT ANSWER: Mortgage broker
Question 13: Entities which provide their own funds for
the purpose of providing mortgage financing, as opposed to commercial banks/savings associations. This is referred