Financing Flashcards
7 cards from real Real Estate License practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Financing flashcards as text
The clause that allows a lender to declare the entire loan balance due upon default is the:
Answer: Acceleration clause
An acceleration clause makes the full balance immediately due if the borrower defaults.
Usury laws are designed to limit:
Answer: Maximum interest rates charged
Usury laws cap the maximum interest rate a lender may legally charge.
In a deed of trust, the party who holds title on behalf of the lender is the:
Answer: Trustee
The trustee holds bare legal title until the loan is repaid in a deed of trust.
The Equal Credit Opportunity Act (ECOA) prohibits discrimination in lending based on all EXCEPT:
Answer: Creditworthiness
ECOA bars discrimination on prohibited bases but lenders may consider actual creditworthiness.
A loan that combines an existing mortgage with a new one into a single payment is a:
Answer: Wraparound mortgage
A wraparound mortgage wraps the existing loan into a new, larger loan with one payment.
RESPA primarily regulates:
Answer: Settlement and closing cost disclosures
The Real Estate Settlement Procedures Act governs disclosure of settlement and closing costs.
Amortization of a loan refers to:
Answer: Gradual repayment of principal and interest over time
Amortization is the systematic repayment of principal and interest over the loan term.