Real Estate Investing Real Estate Financing Methods 2

Question 1

What is a 'blanket mortgage' used for in real estate investing?

Accepted Answer

Covering multiple properties under one loan

Answer

Financing a single-family home purchase

Answer

Refinancing an existing mortgage

Answer

Funding commercial renovations only

Question 2

In a seller carryback arrangement, who acts as the lender?

Accepted Answer

The property seller

Answer

A commercial bank

Answer

A private equity firm

Answer

The local credit union

Question 3

What does LTV stand for in real estate financing?

Accepted Answer

Loan-to-Value

Answer

Long-Term Value

Answer

Lender Transfer Verification

Answer

Lease-to-Vacancy

Question 4

Which loan type allows investors to use equity in existing properties to fund new purchases?

Accepted Answer

Home Equity Line of Credit (HELOC)

Answer

FHA loan

Answer

Bridge loan

Answer

Construction loan

Question 5

What is the primary advantage of an adjustable-rate mortgage (ARM) for a short-term investor?

Accepted Answer

Lower initial interest rate during the introductory period

Answer

Lower interest rates for the life of the loan

Answer

Fixed payments regardless of market changes

Answer

No requirement for a down payment

Question 6

A 'subject-to' financing deal means the buyer:

Accepted Answer

Takes ownership while the seller's existing mortgage stays in place

Answer

Pays off the seller's mortgage before closing

Answer

Refinances the property immediately after purchase

Answer

Qualifies for a new conventional loan

Question 7

What is a debt service coverage ratio (DSCR) loan primarily based on?

Accepted Answer

The property's income relative to its debt obligations

Answer

The borrower's personal credit score only

Answer

The borrower's W-2 employment history

Answer

The property's location and zip code