Xinnix SOAR Final Questions With Verified
Answers Graded A+
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
Answers Graded A+
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
