Xinnix SOAR Final Exam;All possible questions and
answers 2023 with complete solution
FNMA and FHLMC are what type of loan?
conforming
the main purpose of the Consumer financial protection bureau (CFPB) is to help
consumers understand the terms of their agreements with financial companies
true
conventional loans are not insured by the federal government
true
Agency loans include FHA and VA loans
true
the proceeds of a loan for cash out refinance may be used by the borrower to insure a
new pool
true
a non-agency loan does not have to conform to FNMA guidelines
true
FNMA insured mortgage companies against default
false
Fannie Mae purchased FHA loans from mortgage bankers
true
FHA mortgages are self insured while conventional mortgages require PMI
true
Ginnie Mae was created to purchase government mortgages on the secondary market
false
prepaid interest to reduce the interest rate over the life of the loan
discount points
Freddie Mac offers balloon mortgages but fannie mae doesn't
true
unacceptable borrowers include..
life estates, partnerships, non-profit organizations
when is a co-signer typically permitted on a conventional loan?
when the borrower is putting down at least 10%
borrower must contribute how much if the LTV is greater than 80%? (FNMA)
5%
maximum ratios for occupant borrower alone cannot exceed...
35/43%
DU is the automated system for..
fannie mae
LPA is the system for
freddie mac
the higher the credit score, the lower potential for delinquency
true
the most accurate credit report
RMCR- residential mortgage credit report
,an in file credit report contains only current information about the borrowers credit
false
chapter 13 bankruptcy allows for a 3-5 year repayment plan
true
credit report is ordered at the end of the process just before it goes to the underwriter
false
Permanent and non permanent resident aliens are eligible for mortgage financing
typically under the same terms as US citizens
true
On a purchase transaction, the co-borrower does not have to be listed as a purchaser
on the sales contract
false
A 3/1 arm will usually have a higher interest rate than a 10/1 arm
false
Typically, what is the qualifying rate on a 1-year ARM with a 2/6 caps and a start rate of
4.5? The fully indexed rate is 6.375%
6.5%
The fully indexed rate on an adjustable rate mortgage is calculated based on?
index+margin
When several risk factors are present in one file, it is called ____ and is an indicator of
the likelihood of default?
layered risk
a ch. 7 bankruptcy
wipes out debt completely
5/25 balloon
The loan is fixed for 5 years and then the note is due (balloons) or the customer
chooses to extend.
on a 7/1 ARM you qualify based on the start rate
true
The qualifying rate for an ARM with an initial fixed rate period of five years or less is
generally the greater of 2% above the start rate/ or the fully indexed rate
true
Negative amortization occurs when the combination of interest rate adjustments and
payment caps result in monthly payments that do not cover the monthly interest due
true
How much does a 2/1 buydown typically cost on a conventional loan?
2.5 discount points
on a scale from 450-850, 700 is considered a very low credit score
false
On a conventional mortgage, a lender may use a higher ratio when there are fully
documented compensating factors that justify using the higher ratio and or the DU/LPA
issues the approval
true
You do not count installment debts if they have less than 10 mo
true
,In qualifying on conventional loans, should legal debts be counted in the ratios
regardless of duration?
false
which agency has a 41 back ratio only
VA
FHA published qualifying ratios
31/43
VA is not strict regarding job security
false
PITI
principal, interest, taxes, insurance
ways to determine HOI
- ask borrower if they have gotten a quote
- estimate by calculations
HOI calculations
sales price x .3 = annual HOI
when is PMI required?
when borrower puts less than 20% down
95% LTV is riskier than 90% LTV because the borrower has less of their funds invested
true
1 year ARM is riskier than a 30-year fixed rate loan
true
home inspection is included in cash to close
false
When calculating a quick version of cash to close, the prepaids portion is what
percentage of sales price?
1-1.5%
subordinate financing
any loan type, secured by borrowers property, recorded after first lien.. convenient way
for borrowers to avoid MI//pay off debt
customer profile of fixed-rate second mortgage
conservative, traditional borrowers who do not like ARMs
borrowers ballin on a budget
5-10% for down payment
second mortgage allows to avoid MI, lower monthly payments, control cash flow, and
have continual access to the equity in our home as you pay down your loan balance
equity line
The second mortgage works like a credit card. It will provide for a maximum loan
amount that may or may not be fully disbursed at closing
home equity line of credit
another name for a true second mortgage
fixed-rate second
NOT a characteristic of a true second mortgage
fixed prepaids
When a second mortgage is obtained at the same time as a first mortgage, there are
never any closing costs associated with the second
, false
In the marketplace, subordinate financing is often referred to by other names. Which is
not one?
investment mortgage
Simultaneous is the term used when the second mortgage closes at the same time as
the first mortgage
true
Most lenders offering second mortgages utilize private investors that have more
restrictive guidelines than agency loans, therefore AUS findings will not always be valid
for both loans
true
Second mortgages are typically credit score sensitive
true
Stand-alone is the term used when a second mortgage is being obtained separately
from a first mortgage
true
A subordination agreement is required on every loan that has secondary financing
false
what makes up cash to close?
down payment
closing costs
prepaids
discount points
If a borrower does not qualify on his own for the loan, FNMA will accept the real estate
agent in the transaction as a co-signer, but not as a co-borrower.
false
What is the maximum term for a loan sold to FHLMC?
30 years
what are the reserves required for an investment property?
6 mo plus 2 months for each additional property
What is the minimum borrower's equity for a mortgage secured by a primary residence
on an LTV of less than 80%?
0%
What is the term used for a loan amount greater than $510,400?
JUMBO loan
Verification of employment, income, source of funds and payment history must not be
older than 120 days before the note date
truuuu
FNMA and FHLMC will purchase loans that were closed in the name of a corporation.
false
What is the maximum LTV for a second home? (FHLMC)
90%
If the LTV is 80% on an agency loan, what must be the borrower's portion of the down
payment when purchasing a primary residence? (from his own funds)
5%
answers 2023 with complete solution
FNMA and FHLMC are what type of loan?
conforming
the main purpose of the Consumer financial protection bureau (CFPB) is to help
consumers understand the terms of their agreements with financial companies
true
conventional loans are not insured by the federal government
true
Agency loans include FHA and VA loans
true
the proceeds of a loan for cash out refinance may be used by the borrower to insure a
new pool
true
a non-agency loan does not have to conform to FNMA guidelines
true
FNMA insured mortgage companies against default
false
Fannie Mae purchased FHA loans from mortgage bankers
true
FHA mortgages are self insured while conventional mortgages require PMI
true
Ginnie Mae was created to purchase government mortgages on the secondary market
false
prepaid interest to reduce the interest rate over the life of the loan
discount points
Freddie Mac offers balloon mortgages but fannie mae doesn't
true
unacceptable borrowers include..
life estates, partnerships, non-profit organizations
when is a co-signer typically permitted on a conventional loan?
when the borrower is putting down at least 10%
borrower must contribute how much if the LTV is greater than 80%? (FNMA)
5%
maximum ratios for occupant borrower alone cannot exceed...
35/43%
DU is the automated system for..
fannie mae
LPA is the system for
freddie mac
the higher the credit score, the lower potential for delinquency
true
the most accurate credit report
RMCR- residential mortgage credit report
,an in file credit report contains only current information about the borrowers credit
false
chapter 13 bankruptcy allows for a 3-5 year repayment plan
true
credit report is ordered at the end of the process just before it goes to the underwriter
false
Permanent and non permanent resident aliens are eligible for mortgage financing
typically under the same terms as US citizens
true
On a purchase transaction, the co-borrower does not have to be listed as a purchaser
on the sales contract
false
A 3/1 arm will usually have a higher interest rate than a 10/1 arm
false
Typically, what is the qualifying rate on a 1-year ARM with a 2/6 caps and a start rate of
4.5? The fully indexed rate is 6.375%
6.5%
The fully indexed rate on an adjustable rate mortgage is calculated based on?
index+margin
When several risk factors are present in one file, it is called ____ and is an indicator of
the likelihood of default?
layered risk
a ch. 7 bankruptcy
wipes out debt completely
5/25 balloon
The loan is fixed for 5 years and then the note is due (balloons) or the customer
chooses to extend.
on a 7/1 ARM you qualify based on the start rate
true
The qualifying rate for an ARM with an initial fixed rate period of five years or less is
generally the greater of 2% above the start rate/ or the fully indexed rate
true
Negative amortization occurs when the combination of interest rate adjustments and
payment caps result in monthly payments that do not cover the monthly interest due
true
How much does a 2/1 buydown typically cost on a conventional loan?
2.5 discount points
on a scale from 450-850, 700 is considered a very low credit score
false
On a conventional mortgage, a lender may use a higher ratio when there are fully
documented compensating factors that justify using the higher ratio and or the DU/LPA
issues the approval
true
You do not count installment debts if they have less than 10 mo
true
,In qualifying on conventional loans, should legal debts be counted in the ratios
regardless of duration?
false
which agency has a 41 back ratio only
VA
FHA published qualifying ratios
31/43
VA is not strict regarding job security
false
PITI
principal, interest, taxes, insurance
ways to determine HOI
- ask borrower if they have gotten a quote
- estimate by calculations
HOI calculations
sales price x .3 = annual HOI
when is PMI required?
when borrower puts less than 20% down
95% LTV is riskier than 90% LTV because the borrower has less of their funds invested
true
1 year ARM is riskier than a 30-year fixed rate loan
true
home inspection is included in cash to close
false
When calculating a quick version of cash to close, the prepaids portion is what
percentage of sales price?
1-1.5%
subordinate financing
any loan type, secured by borrowers property, recorded after first lien.. convenient way
for borrowers to avoid MI//pay off debt
customer profile of fixed-rate second mortgage
conservative, traditional borrowers who do not like ARMs
borrowers ballin on a budget
5-10% for down payment
second mortgage allows to avoid MI, lower monthly payments, control cash flow, and
have continual access to the equity in our home as you pay down your loan balance
equity line
The second mortgage works like a credit card. It will provide for a maximum loan
amount that may or may not be fully disbursed at closing
home equity line of credit
another name for a true second mortgage
fixed-rate second
NOT a characteristic of a true second mortgage
fixed prepaids
When a second mortgage is obtained at the same time as a first mortgage, there are
never any closing costs associated with the second
, false
In the marketplace, subordinate financing is often referred to by other names. Which is
not one?
investment mortgage
Simultaneous is the term used when the second mortgage closes at the same time as
the first mortgage
true
Most lenders offering second mortgages utilize private investors that have more
restrictive guidelines than agency loans, therefore AUS findings will not always be valid
for both loans
true
Second mortgages are typically credit score sensitive
true
Stand-alone is the term used when a second mortgage is being obtained separately
from a first mortgage
true
A subordination agreement is required on every loan that has secondary financing
false
what makes up cash to close?
down payment
closing costs
prepaids
discount points
If a borrower does not qualify on his own for the loan, FNMA will accept the real estate
agent in the transaction as a co-signer, but not as a co-borrower.
false
What is the maximum term for a loan sold to FHLMC?
30 years
what are the reserves required for an investment property?
6 mo plus 2 months for each additional property
What is the minimum borrower's equity for a mortgage secured by a primary residence
on an LTV of less than 80%?
0%
What is the term used for a loan amount greater than $510,400?
JUMBO loan
Verification of employment, income, source of funds and payment history must not be
older than 120 days before the note date
truuuu
FNMA and FHLMC will purchase loans that were closed in the name of a corporation.
false
What is the maximum LTV for a second home? (FHLMC)
90%
If the LTV is 80% on an agency loan, what must be the borrower's portion of the down
payment when purchasing a primary residence? (from his own funds)
5%
