LegalIssues-WichitaStateUniversity法律问题-威奇托州立大学.doc

RE 611 / Fin 611 Real Estate FinanceLegal Considerations & Mortgage Markets OverviewSample Quiz QuestionsDr. Stanley D. Longhofer_ 1. True or False: Technically speaking a “mortgage” is not a loan, but rather the pledge of real property as collateral for a loan. _ 2. True or False: Financial intermediaries are middlemen that generally reduce the cost of transferring funds between savers and investors. _ 3. True or False: Zach recently purchased a property “subject to” an existing mortgage. As a result, he is now personally liable for repaying the loan. _ 4. The “tilt effect” refers to which of the following issues? A. The impact of expected inflation on the value of the monthly payments on fixed rate mortgages.B. The impact of unexpected inflation on the value of the monthly payments on fixed rate mortgages.C. The impact of caps and floors on adjustable rate mortgages.D. The impact of payment caps on adjustable rate mortgages.E. None of the above. _ 5. Which of the following are problems with direct investment as a means of transferring capital from savers (those with excess funds) to investors (those who need funds)? More than one answer may be correct; write down the letter of all correct answers. A. It can be hard for savers and investors to find one another.B. It can be costly for savers to determine the riskiness of the proposed investment. C. The fees charged by the middleman can be very costly.D. Many different savers may need to be brought together to fund a large investment opportunity.E. The rate of return required by savers may be too low for investors to pay._ 6. _ do not generally fund mortgage loans. Instead they match up borrowers and lenders. A. Fannie Mae and Freddie MacB. Mortgage brokersC. Mortgage banksD. Commercial banksE. Insurance companies_ 7. True or False: Financial intermediaries are middlemen that increase the cost of transferring funds between savers and investors. _ 8. What is the primary difference between a mortgage bank and a mortgage broker?A. Mortgage banks fund loans using deposits, whereas mortgage brokers fund loans using warehouse loans. B. Mortgage banks hold the loans they originate in their portfolios, while mortgage brokers sell the loans on the secondary market. C. Mortgage banks fund new loans, whereas mortgage brokers simply match up borrowers and lenders. D. Mortgage banks charge lower fees on average than mortgage brokers. E. All of the above. _ 9. Which of the following is an agency of the federal government? More than one answer may be correct; write down the letters of all correct answers. A. Fannie MaeB. Freddie MacC. Sallie MaeD. Ginnie MaeE. Bank of America_ 10. _ are non-profit, cooperative depository institutions. A. Credit unionsB. Commercial banksC. Mortgage banksD. ThriftsE. All of the above_ 11. Adam recently entered into a contract to purchase some real estate from Calvin using a land contract. This means thatA. Calvin provided Adam a purchase money mortgage to buy the property. B. Adam purchased only the land and not the building on the land. C. Adam paid cash for the real estate.D. Calvin still retains title to the real estate, while Adam has an equitable interest in the property. E. Calvin has lent Adam the down payment required for his first mortgage loan. _ 12. True or False: The lender only has a right to foreclose on the mortgaged property when the borrower defaults on a mortgage; if the property is worth less than the amount owed, the lender has no further claim on the borrower. _ 13. True or False: In general, lenders are quick to pursue foreclosure when a borrower becomes delinquent on a mortgage because this is the best way for them to protect their interest in the property. _ 14. The term “conventional mortgages” refers to A. loans that do not have any form of formal government backing.B. loans that do not require private mortgage insurance.C. all commercial mortgage loans.D. all residential mortgage loans.E. loans that can be sold on the secondary market to Fannie Mae or Freddie Mac. _ 15. The term “conforming mortgages” refers to A. loans that do not have any form of formal government backing.B. loans that do not require private mortgage insurance.C. all commercial mortgage loans.D. all residential mortgage loans.E. loans that can be sold on the secondary market to Fannie Mae or Freddie Mac. _ 16. Most residential mortgages include a “due-on-sale” or “alienation” clause. This clause A. requires the borrower to maintain hazard insurance on the property.B. requires the lender to release the mortgage once the loan is repaid.C. requires the borrower to repay the entire outstanding loan balance when the property is sold.D. allows the lender to demand full payment of the loan upon default of any of the terms of the loan. E. prohibits the borrower from repaying any of the principal early. _ 17. True or False: Malcolm recently purchased a property “assuming” an existing mortgage. As a result, he is now personally liable for repaying the loan. _ 18. Mortgage loan servicing involvesA. evaluating the information in the loan application and deciding whether to approve the mo