REE 3043 WOODYARD EXAM 3 QUESTIONS AND
ANSWERS 2026
A clause which grants the holder of the note the rights to all remaining payments on the
loan should the borrower default. - Answers - Acceleration clause
An acceleration clause that is enforceable upon the sale of the property. - Answers -
Due-on-sale clause
A clause that allows lenders to adjust the interest rate charged with respect to some
stated index. - Answers - Interest escalation and adjustment clause
A clause that imposes a penalty (fee) on borrowers for making early payments of
principal on the amount borrowed. - Answers - Prepayment clause
A clause which requires borrowers to make payments of their hazard insurance
premium along with their periodic payments of principal and interest. - Answers -
Insurance Clause
Technically a mortgage is best described as:
A. a loan from a lending institution
B. A loan on a property
C. A contractual pledge for real estate to serve as collateral for a loan.
D. All of the above - Answers - C. A mortgage is a special debt contract given by
borrowers who pledge real estate as the security for a loan.
In the U.S.:
A. The government encourages the development of mortgage securities.
B. Wall Street investment banks participate in the commercial mortgage market.
C. Equity financing sources include life insurance companies.
D. All of the above - Answers - D
The secondary mortgage market serves as:
A. A source for the sale of mortgages to investors.
B. A source for loan origination
C. A source for load renegotiation
D. All of the above - Answers - A
Firms which assist pension funds, insurance companies, or other lender's in distributing
mortgage obligations to mortgage investors are known as:
, A. Conduits
B. Advisors
C. Go betweens
D. Tranches - Answers - A. Firms known as conduits assist in various ways with the
movement of the mortgage from the lender's portfolio through the secondary market into
the investment portfolios of investors.
Mortgage documents containing notes with specific language about the borrower's
promise to repay loans establish what is termed:
A. Resource financing
B. A lien
C. A foreclosure statement
D. Nonrecourse financing - Answers - A
The public equity quadrant of real estate markets includes the following major
participants:
A. Pension funds
B. Equity REITs
C. Insurance companies
D. Banks - Answers - B
Money that is invested in shares issued and traded in securities markets of pools of
mortgage loans such as mortgage-backed securities is termed:
A. Private equity
B. Public equity
C. Private debt
D. Public debt - Answers - D
A loan in which a builder is required to obtain a forward commitment to secure
construction financing is termed:
A. An open-end loan
B. A wrap-around loan
C. A covered loan
D. A purchase money mortgage - Answers - C. Builders often need forward
commitments to secure construction financing from construction lenders. Such financing
is termed a covered construction loan.
A clause which required that all remaining payments are due on the loan to be paid in
the event of default is termed the:
A. Acceleration clause
B. Late payment clause
ANSWERS 2026
A clause which grants the holder of the note the rights to all remaining payments on the
loan should the borrower default. - Answers - Acceleration clause
An acceleration clause that is enforceable upon the sale of the property. - Answers -
Due-on-sale clause
A clause that allows lenders to adjust the interest rate charged with respect to some
stated index. - Answers - Interest escalation and adjustment clause
A clause that imposes a penalty (fee) on borrowers for making early payments of
principal on the amount borrowed. - Answers - Prepayment clause
A clause which requires borrowers to make payments of their hazard insurance
premium along with their periodic payments of principal and interest. - Answers -
Insurance Clause
Technically a mortgage is best described as:
A. a loan from a lending institution
B. A loan on a property
C. A contractual pledge for real estate to serve as collateral for a loan.
D. All of the above - Answers - C. A mortgage is a special debt contract given by
borrowers who pledge real estate as the security for a loan.
In the U.S.:
A. The government encourages the development of mortgage securities.
B. Wall Street investment banks participate in the commercial mortgage market.
C. Equity financing sources include life insurance companies.
D. All of the above - Answers - D
The secondary mortgage market serves as:
A. A source for the sale of mortgages to investors.
B. A source for loan origination
C. A source for load renegotiation
D. All of the above - Answers - A
Firms which assist pension funds, insurance companies, or other lender's in distributing
mortgage obligations to mortgage investors are known as:
, A. Conduits
B. Advisors
C. Go betweens
D. Tranches - Answers - A. Firms known as conduits assist in various ways with the
movement of the mortgage from the lender's portfolio through the secondary market into
the investment portfolios of investors.
Mortgage documents containing notes with specific language about the borrower's
promise to repay loans establish what is termed:
A. Resource financing
B. A lien
C. A foreclosure statement
D. Nonrecourse financing - Answers - A
The public equity quadrant of real estate markets includes the following major
participants:
A. Pension funds
B. Equity REITs
C. Insurance companies
D. Banks - Answers - B
Money that is invested in shares issued and traded in securities markets of pools of
mortgage loans such as mortgage-backed securities is termed:
A. Private equity
B. Public equity
C. Private debt
D. Public debt - Answers - D
A loan in which a builder is required to obtain a forward commitment to secure
construction financing is termed:
A. An open-end loan
B. A wrap-around loan
C. A covered loan
D. A purchase money mortgage - Answers - C. Builders often need forward
commitments to secure construction financing from construction lenders. Such financing
is termed a covered construction loan.
A clause which required that all remaining payments are due on the loan to be paid in
the event of default is termed the:
A. Acceleration clause
B. Late payment clause
