Chapter 14 Financing Conventional, FHA and VA loans Flashcards Preview

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Flashcards in Chapter 14 Financing Conventional, FHA and VA loans Deck (29)
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1
Q

low down payment INSURED mortgage loan

A

FHA 203(b)

2
Q

loan with monthly payments including property taxes and insurance

A

Budget loan

3
Q

mortgage can be taken over by next buyer

A

Assumable

4
Q

VA appraisal statement

A

Certificate of reasonable value

5
Q

Highest interest rate ever allowed on a specific adjustable loan

A

Ceiling

6
Q

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

A

Amortization Schedule

7
Q

payment of extra points in return for lower interest rate

A

Buydown (points payment)

8
Q

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

A

Amendatory Clause

9
Q

percentage beyond which interest rate cannot be raised at adjustment

A

Cap

10
Q

plan with interest rate changed either up or down periodically

A

Adjustable rate mortgage

11
Q

repayment plan including principal payments; gradually reduces debt

A

Amortized loan

12
Q

repayment plan, the equivalent of 13 monthly payments per year

A

Biweekly mortgage

13
Q

US agency that insures mortgage to protect lending institutions

A

Federal Housing Administration ( FHA )

14
Q

written estimate of value by real estate licensee

A

BPO ( Broker price opinion)

15
Q

CHARGE of the use of other peoples money

A

Interest

16
Q

guide to national mortgage trends, use for adjustable mortgage rates

A

Index

17
Q

lender of low interest money in certain areas

A

New Jersey Housing and Mortgage Finance Agency (NJHMFA)

18
Q

Mortgage payment, including Interest, amortization, and certain expenses

A

PITI ( Principle, Interest, Tax and Insurance)

19
Q

mortgage with payments of interest only

A

Straight loan

20
Q

loan guaranteed by Federal Government

A

VA mortgage

21
Q

neighborhoods in which the state wishes to strengthen housing stock

A

Target area

22
Q

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

A

Points

23
Q

percentage charged by lender above index rate

A

Margin

24
Q

percentage of property’s market value that may be borrowed

A

Loan to value ratio

25
Q

protection for the lender on a low down payment mortgage loan

A

Private Mortgage Insurance ( PMI )

26
Q

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

A

Rate lock

27
Q

difference between current value and money owed

A

Equity

28
Q

Explanation of Financing terms

A

Toolkit

29
Q

Amortize means

A

to kill off slowly over time