CHAMPIONS SCHOOL OF REAL ESTATE PRINCIPLE OF REAL ESTATE 1 ACTUAL EXAMS COMPLETE REAL QUESTIONS AND CORRECT ANSWERS (CORRECT VERIFIED SOLUTIONS) NEWEST UPDATED VERSION

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CHAMPIONS REAL ESTATE FINANCE EXAM 20
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25| BRAND NEW ACTUAL EXAM WITH 100% VE
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RIFIED QUESTIONS AND CORRECT SOLUTION
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S| GUARANTEED VALUE PACK| ACE YOUR GRA
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DES.

1. Loan-to-ValuegRatiog(LTV)g-gcorrectganswerg-
gThegpercentagegofgtheglessergofgthegappraisedgvaluegorgsalesgpricegt

hatgtheglendergwillglend.


ex:gIfgagborrowergisgapprovedgforgang80%gloan,gitgmeansgthatgtheglender
gwillgloangupgtog80%gofgthegsalesgpricegorgappraisedgvalue,gwhichevergi

sglower.




2. PackagegMortgageg-gcorrectganswerg-
gIncludesgbothgrealgandgpersonalgpropertyg(gfixturesgandgfurnishings)




3. BlanketgMortgageg-gcorrectganswerg-
gCoversgmoregthangonegpiecegofgproperty.




4. WraparoundgMortgageg-gcorrectganswerg-
gMethodgofgfinancinggwhichgpreservesgtheglow,gexistingginterestgrateg

ongthegoriginalgnote.

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5. Open-EndgMortgageg-gcorrectganswerg-
gPermitsgadditionalgborrowinggongthegsamegnote.gThisgisgsometimesgcall

edgagcreditgcardgmortgagegorgaghomegequityglinegofgcreditg-gHELOC.




6. BudgetgMortgageg-gcorrectganswerg-
gThegmonthlyghousegpaymentgincludesgprincipal,ginterest,gtaxesga

ndginsuranceg(knowngasgPITI)




7. Collateralg-DependentgLoansg-gcorrectganswerg-
gAghardgmoneygloangisgagspecificgtypegofgasset-

basedgfinancinggingwhichgagborrowergreceivesgfundsgsecuredgbygthegval
uegofgagparcelgofgrealgestate.




8. Characterg-gcorrectganswerg-
gIsgagmeasuregofgthegwillingnessgofgagborrowergtogmakegon-

timegpayments.gCreditgcharactergisgrevealedgingthegborrower'sgcreditgrep
ort.




9. Capacityg-gcorrectganswerg-
gIsgagmeasuregofgthegborrower'sgabilitygtogrepaygthegdebt,gandgisgdemo

nstratedgthroughgcurrentgearningsgandgjobgstability.




10. Capitalg-gcorrectganswerg-
gIsgthegsumgofgallgassetsgthatgthegborrowerghasgaccumulated.

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11. Collateralg-gcorrectganswerg-
gIsgsomethinggofgvaluegthatgcangbegpledgedgasgsecuritygforgrepay

ment.




12. Yieldg-gcorrectganswerg-
gIsgthegreturngthatgtheginvestorgrecievesgovergtheglifegofgthegloan.g(Alsog

knowngasgprofit)




13. Originatorg-gcorrectganswerg-
gThegprocessgofgcreatinggagnewgmortgagegloan,gincludinggallgstepsgtakeng

bygaglendergtogattractgandgqualifygagborrower.




14. MortgagegBrokerg-gcorrectganswerg-
gTypicallygfunctionsgasgagmiddlemangbetweengthegborrowergandgtheglend

er,gnegotiating,gsellinggorgarranginggloansgtogbegdeliveredgtoglargerginves
tors.gAtgonegtimegoriginatedgupgtog80%gofgallgmortgagegloans.g(Backgongt
hegrise)




15. MortgagegBankerg-gcorrectganswerg-
gEntitiesgwhichgprovidegtheirgowngfundsgforgthegpurposegofgprovidinggmo

rtgagegfinancing,gasgopposedgtogcommercialgbanks/savingsgassociation
s.g(Held,gorg"Warehoused")




16. CorrespondentgLenderg-gcorrectganswerg-
gUsuallygsmallergingscalegthangmortgagegbankersgorgbrokers,gtheseglend

ersgtypicallygextendgloansgwithgtheirgowngfunds,gatgtheirgowngrisk.

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17. Processingg-gcorrectganswerg-
gOncegapplicationgisgcompletegthegfilegmovesgintogthisgphase.




18. Underwritingg-gcorrectganswerg-
gThegdetailedgprocessgofgevaluatinggagborrower'sgloangapplicationgtogdet

erminegthegriskginvolvedgforgtheglender.




19. Closingg-gcorrectganswerg-
gThegconsummationgofgagrealgestategtransactiongingwhichgallgappro

priategdocumentsgaregsignedgandgthegproceedsgofgthegmortgageglo
angaregthengdisbursedgbygtheglender.




20. Servicingg-gcorrectganswerg-
gIncludesgcollectinggmonthlygpayments,gmaintaininggrecordsgofgpayme

ntsgandgbalances,gcollectinggandgpayinggtaxesgandginsuranceg(gandgm
anaginggescrowgandgimpoundgfunds)gremittinggfundsgtogthegnoteghold
er,gandgfollowinggupgongdelinquencies.




21. SupplygandgDemandg-gcorrectganswerg-
gangeconomicgconceptgthatgstatesgthatgthegpricegofgaggoodgrisesgandgfal

lsgdependinggonghowgmanygpeoplegwantgitgandgdependinggonghowgmu
chgofgtheggoodgisgavailable.




22. Fundingg-gcorrectganswerg-
gThegprocessgofgtransferringgfundsgtogagtitlegorgescrowgcompanygforgdisbu

rsement