Real Estate 101 - Real Estate Principles » Fall 2021 » Chapter 9 Quiz
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Question #1
With what type of clause does the entire balance of the loan become due and payable when an owner is alienating, transferring, or conveying a property?
A.
Transfer clause
B.
Conveyance clause
C.
None of the answers are correct
D.
Alienation clause
Question #2
The practice of purchasing real estate using a small amount of your own money and a large portion of borrowed funds is known as:
A.
alienation.
B.
amortization.
C.
hypothecation.
D.
Ieverage.
Question #3
Moneys collected in advance from borrowers to assure the payment of recurring costs are known as:
A.
none of the answers are correct.
B.
accumulation accounts.
C.
safety accounts.
D.
impound accounts.
Question #4
Which of the following liens are NOT eliminated by a foreclosure sale?
A.
State, county or city taxes
B.
All answers are correct
C.
State, county, or city assessments
D.
Federal tax liens
Question #5
Another term for the trustee is:
A.
borrower.
B.
escrow company.
C.
lender.
D.
third party.
Question #6
A clause in a financial instrument that allows a lender to demand immediate payment of the entire note balance is known as a(n):
A.
acceleration clause.
B.
damage clause.
C.
demand clause.
D.
assumption clause.
Question #7
What document does a trustee record after being notified by the lender of the trustor’s nonpayment?
A.
Notice of Deficiency
B.
Request for Notice
C.
Notice of Foreclosure
D.
Notice of Default
Question #8
What do we call a borrower who secures a loan through a trust deed?
A.
Trustor
B.
Beneficiary
C.
Trustee
D.
Holder in due course
Question #9
What provision in an instrument of finance would permit a change in the priority of liens on a property?
A.
Subordination clause
B.
Acceleration clause
C.
Alienation clause
D.
MPR provision
Question #10
What type of loan allows the interest rate to "fluctuate" depending on money market conditions?
A.
Adjustable rate mortgage
B.
Graduated payment mortgage
C.
Reverse annuity mortgage
D.
Fixed rate mortgage
Question #11
Should the trustor default, the trustee may have to sell the property for the:
A.
trustor.
B.
beneficiary.
C.
title insurance company.
D.
trustee.
Question #12
Which of the following is NOT a party to a trust deed?
A.
Beneficiary
B.
Trustee
C.
Grantor
D.
Trustor
Question #13
The trustor is also known as the:
A.
borrower.
B.
escrow.
C.
third party.
D.
Iender.
Question #14
The trustee issues a "reconveyance deed" when the promissory note is:
A.
expired.
B.
recorded.
C.
paid in full.
D.
in default.
Question #15
A person who takes a negotiable instrument from another with no knowledge of defect is called a(n):
A.
assignee.
B.
holder in due course.
C.
Iimited note holder.
D.
attorney-in-fact.
Question #16
Which of the following is FALSE concerning the Annual Percentage Rate (APR)?
A.
It is expressed as a weekly rate.
B.
It is expressed as a percentage rate.
C.
It includes all credit costs.
D.
It is expressed as an annual rate.
Question #17
The "nominal interest rate" is:
A.
compounded daily.
B.
stated in the note.
C.
the current interest rate.
D.
the effective interest rate.
Question #18
The basic instrument used to evidence an obligation or debt is a:
A.
mortgage
B.
Iand contract.
C.
trust deed.
D.
promissory note.
Question #19
The 1% loan fee on FHA loans is usually paid by the:
A.
lender.
B.
broker.
C.
buyer.
D.
seller.
Question #20
A lender charges an origination fee, which includes points. One “point” is equal to:
A.
100% of the loan amount.
B.
10% of the loan amount.
C.
1% of the loan amount.
D.
.01% of the loan amount.
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