#1
What does LTV stand for in real estate financing?
Loan to Value
Land Title Verification
Lease Term Variation
Lien on Tenant's Valuables
#2
What is a 'down payment' in the context of real estate financing?
A payment made to secure a rental property
An initial payment towards the purchase price of a property
A fee charged by the real estate agent
A payment made to the homeowners' association
#3
What is a 'jumbo loan' in real estate financing?
A loan for tiny houses
A loan exceeding the conforming loan limits set by Fannie Mae and Freddie Mac
A loan with no down payment required
A loan for commercial real estate
#4
What is a 'lien' in the context of real estate?
A legal claim on a property as security for a debt
The process of transferring property ownership
The maximum amount a borrower can qualify for
A type of property appraisal
#5
What is the purpose of a 'due diligence' period in a real estate transaction?
To finalize the closing costs
To allow the buyer to inspect the property and its documents before finalizing the purchase
To negotiate the interest rate with the lender
To determine the property's market value
#6
Which type of mortgage has a fixed interest rate and monthly payments that never change?
Adjustable Rate Mortgage (ARM)
Interest-Only Mortgage
Fixed-Rate Mortgage
Balloon Mortgage
#7
What is the role of a mortgage broker in real estate financing?
Inspecting properties for potential buyers
Negotiating lease agreements
Connecting borrowers with lenders
Managing property appraisals
#8
What does the term 'equity' represent in real estate?
The total value of a property
The difference between a property's value and outstanding mortgage debt
The rental income generated by a property
The legal rights associated with property ownership
#9
What is Private Mortgage Insurance (PMI) commonly used for in real estate financing?
To protect lenders in case of borrower default
To insure the property against natural disasters
To cover the cost of property maintenance
To provide life insurance for the borrower
#10
What is the primary purpose of a real estate appraisal?
To estimate the property's potential rental income
To determine the property's market value
To assess the borrower's creditworthiness
To evaluate the property's structural integrity
#11
In the context of real estate financing, what does the term 'closing costs' refer to?
The final payments made by the borrower
The fees and expenses associated with finalizing a real estate transaction
The monthly mortgage payments
The costs of property maintenance
#12
In real estate, what does the term 'amortization' refer to?
The process of selling a property
The gradual repayment of a loan over time
The legal transfer of property ownership
The inspection of a property's structural integrity
#13
What is the Debt Service Coverage Ratio (DSCR) used for in real estate financing?
To determine the property's market value
To assess the borrower's credit score
To evaluate a property's income-generating ability
To calculate property taxes
#14
What is a 'recourse loan' in real estate financing?
A loan with a variable interest rate
A loan where the lender has no recourse in case of default
A loan secured by the borrower's personal assets
A loan used for property renovations
#15
What role does the Federal Housing Administration (FHA) play in real estate financing?
Regulating property taxes
Providing mortgage insurance and facilitating affordable home loans
Assessing property appraisals
Enforcing lease agreements
#16
What is the key characteristic of a 'construction loan' in real estate financing?
Low interest rates
Extended repayment period
Designed for financing the construction of a new property
Secured by the borrower's personal assets
#17
What is the role of Fannie Mae and Freddie Mac in the real estate market?
Providing mortgage insurance
Regulating property appraisals
Setting interest rates
Buying and guaranteeing mortgages to provide liquidity to the housing market