Pearson Vue Exam Prep: Financing
and Settlement Questions & Answers
(Grade A+)
equity -
correct answer ✅difference between a homes value and how
much debt is owed on it
negative equity -
correct answer ✅borrower owes more than the property is worth
principal ($) -
correct answer ✅The amount of money borrowed
interest -
correct answer ✅the price paid for the use of borrowed money
loan term -
correct answer ✅The length of time you have to pay off a loan.
Amortization -
correct answer ✅paying off a loan over time
,Pearson Vue Exam Prep: Financing
and Settlement Questions & Answers
(Grade A+)
what is a point? -
correct answer ✅1% of the loan amount
buydown -
correct answer ✅interest payment borrower makes to reduce
interest rate
conventional mortgage loans -
correct answer ✅require down payment up to 20%
diverse loan terms
are conventional mortgage loans insured by the federal govt? -
correct answer ✅no
FHA Loan -
correct answer ✅lower credit scores
smaller down payment
higher credit risk
lower interest rates
, Pearson Vue Exam Prep: Financing
and Settlement Questions & Answers
(Grade A+)
does FHA insure lenders? -
correct answer ✅yes
who has access to VA loans? -
correct answer ✅veterans and their spouses
USDA Farm Service Agency Loan -
correct answer ✅for farmers, ranchers, and rural housing
who funds FSA loans? -
correct answer ✅congressional appropriation
Rural Development Loans -
correct answer ✅Loans for family farms and rural housing
longer payback period
Financing Instruments -
correct answer ✅security instruments such as mortgages, deeds of
trust, and promissory notes
and Settlement Questions & Answers
(Grade A+)
equity -
correct answer ✅difference between a homes value and how
much debt is owed on it
negative equity -
correct answer ✅borrower owes more than the property is worth
principal ($) -
correct answer ✅The amount of money borrowed
interest -
correct answer ✅the price paid for the use of borrowed money
loan term -
correct answer ✅The length of time you have to pay off a loan.
Amortization -
correct answer ✅paying off a loan over time
,Pearson Vue Exam Prep: Financing
and Settlement Questions & Answers
(Grade A+)
what is a point? -
correct answer ✅1% of the loan amount
buydown -
correct answer ✅interest payment borrower makes to reduce
interest rate
conventional mortgage loans -
correct answer ✅require down payment up to 20%
diverse loan terms
are conventional mortgage loans insured by the federal govt? -
correct answer ✅no
FHA Loan -
correct answer ✅lower credit scores
smaller down payment
higher credit risk
lower interest rates
, Pearson Vue Exam Prep: Financing
and Settlement Questions & Answers
(Grade A+)
does FHA insure lenders? -
correct answer ✅yes
who has access to VA loans? -
correct answer ✅veterans and their spouses
USDA Farm Service Agency Loan -
correct answer ✅for farmers, ranchers, and rural housing
who funds FSA loans? -
correct answer ✅congressional appropriation
Rural Development Loans -
correct answer ✅Loans for family farms and rural housing
longer payback period
Financing Instruments -
correct answer ✅security instruments such as mortgages, deeds of
trust, and promissory notes
