CA Real Estate Finance Course » 2021 » Sec 7 Unit 5 Exam

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Question #1
A homeowner has been paying her mortgage for several years and has built up equity. She decides to take out a home equity line of credit because she needs some cash. This credit will create ______.
A.   A subordination of her mortgage
B.   Negative amortization on her mortgage
C.   An addition to the principal on her mortgage
D.   A junior lien on the property
Question #2
The Morris family home went into foreclosure December 15, 2016, and sold January 1, 2017. Their contractor had begun work on May 15, 2015, and was not paid, and finally filed a mechanic’s lien on October 1, 2016. What date will be used for lien priority for the mechanic’s lien?
A.   May 15, 2015
B.   January 1, 2017
C.   December 15, 2016
D.   October 1, 2016
Question #3
A foreclosure occurs January 1, 2016. Of the following, which lien takes priority?
A.   A mechanic's lien filed February 15, 2014, where work commenced December 1, 2013
B.   A senior mortgage filed October 15, 2013
C.   A property tax lien filed January 1, 2014
D.   A junior mortgage filed January 1, 2015
Question #4
Which of the following is true about a home equity line of credit?
A.   It's a lump sum payment.
B.   A borrower can use the funds as needed, repay them, and borrow them again.
C.   Any amount used must be repaid before additional funds can be accessed.
D.   It takes priority over the original financing for the home

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