Arizona Real Estate License Arizona Real Estate License Real Estate Financing Concepts Questions and Answers 2

Question 1

In Arizona, which type of mortgage clause allows the lender to demand full repayment if the borrower sells or transfers the property?

Accepted Answer

Due-on-sale clause

Answer

A due-on-sale clause gives the lender the right to demand immediate full payment of the loan balance when the property is sold or transferred.

Question 2

What is the primary difference between a mortgage and a deed of trust in Arizona real estate financing?

Accepted Answer

A deed of trust involves three parties while a mortgage involves two

Answer

A deed of trust involves the borrower, lender, and a neutral third-party trustee, whereas a mortgage involves only the borrower and lender.

Question 3

Which federal regulation requires lenders to provide borrowers with a Loan Estimate within three business days of receiving a mortgage application?

Accepted Answer

TILA-RESPA Integrated Disclosure (TRID)

Answer

TRID rules under the combined TILA-RESPA framework require lenders to deliver a Loan Estimate within three business days of a completed loan application.

Question 4

A borrower obtains a loan where monthly payments cover only the interest for the first five years. What type of loan is this?

Accepted Answer

Interest-only loan

Answer

An interest-only loan requires the borrower to pay only the interest portion for a set period before principal payments begin.

Question 5

In Arizona, what is the typical redemption period after a judicial foreclosure sale?

Accepted Answer

Six months

Answer

Arizona law generally provides a six-month statutory redemption period following a judicial foreclosure sale.

Arizona Real Estate License Practice Test

Arizona Real Estate License Practice Test

Arizona Real Estate License Arizona Real Estate License Real Estate Financing Concepts Questions and Answers 2