Chapter 14 Financing Conventional, FHA and VA loans

Question 1

low down payment INSURED mortgage loan

Answer 1

FHA 203(b)

Question 2

loan with monthly payments including property taxes and insurance

Answer 2

Budget loan

Question 3

mortgage can be taken over by next buyer

Answer 3

Assumable

Question 4

VA appraisal statement

Answer 4

Certificate of reasonable value

Question 5

Highest interest rate ever allowed on a specific adjustable loan

Answer 5

Ceiling

Question 6

listing of each payment: interest, principal paid, remaining debt

Answer 6

Amortization Schedule

Question 7

payment of extra points in return for lower interest rate

Answer 7

Buydown (points payment)

Question 8

States that a buyer getting an FHA loan can rescind (cancel) the contract if the appraisal is lower than the purchase price

Answer 8

Amendatory Clause

Question 9

percentage beyond which interest rate cannot be raised at adjustment

Answer 9

Cap

Question 10

plan with interest rate changed either up or down periodically

Answer 10

Adjustable rate mortgage

Question 11

repayment plan including principal payments; gradually reduces debt

Answer 11

Amortized loan

Question 12

repayment plan, the equivalent of 13 monthly payments per year

Answer 12

Biweekly mortgage

Question 13

US agency that insures mortgage to protect lending institutions

Answer 13

Federal Housing Administration ( FHA )

Question 14

written estimate of value by real estate licensee

Answer 14

BPO ( Broker price opinion)

Question 15

CHARGE of the use of other peoples money

Answer 15

Interest

Question 16

guide to national mortgage trends, use for adjustable mortgage rates

Answer 16

Index

Question 17

lender of low interest money in certain areas

Answer 17

New Jersey Housing and Mortgage Finance Agency (NJHMFA)

Question 18

Mortgage payment, including Interest, amortization, and certain expenses

Answer 18

PITI ( Principle, Interest, Tax and Insurance)

Question 19

mortgage with payments of interest only

Answer 19

Straight loan

Question 20

loan guaranteed by Federal Government

Answer 20

VA mortgage

Question 21

neighborhoods in which the state wishes to strengthen housing stock

Answer 21

Target area

Question 22

1% of loan amount charged as extra up front interest when loan is made

Answer 22

Points

Question 23

percentage charged by lender above index rate

Answer 23

Margin

Question 24

percentage of property’s market value that may be borrowed

Answer 24

Loan to value ratio

Question 25

protection for the lender on a low down payment mortgage loan

Answer 25

Private Mortgage Insurance ( PMI )

Question 26

lender agrees to hold the interest rate for a certain period of time

Answer 26

Rate lock

Question 27

difference between current value and money owed

Answer 27

Equity

Question 28

Explanation of Financing terms

Answer 28

Toolkit

Question 29

Amortize means

Answer 29

to kill off slowly over time