Lending Practices and Loans, Finance And Accounting

Question: What is an unsecured loan?
A
An automobile loan

B
A loan where the debtor's credit is the only thing at stake

C
A loan only for uneducated people

D
A loan with no collateral; the lender has no assets backing the loan

Note: Answer not sure
1. Report
Question: What does the term "Deferment" denote?
A
The process of researching loan options

B
The process of applying for government mortgage funding

C
An approved temporary suspension of loan payments based on certain events and criteria

D
Adding interest that has accrued onto the principal balance

Note: Answer not sure
1. Report
Question: What does the term "Endowment" mean?
A
The percentage of gross monthly income that goes towards paying housing expenses

B
A fund that contains assets the use of which is restricted only to the income earned by these assets

C
The same as an escrow account

D
The process of applying for a mortgage

Note: Answer not sure
1. Report
Question: What can a lender do if a borrower refuses to pay back a loan?
A
Nothing — it is a risk the lender takes for high returns

B
Sue the borrower in a small claims court

C
Call the bank that helped structure the loan

D
A loan is a debt contract, and the borrower can be sued for the funds

Note: Answer not sure
1. Report
Question: How do lenders abuse people who are looking to get their homes refinanced?
A
They buy their homes from them

B
They refinance people for minimal interest rate improvements, while charging excessive fees for their services

C
They force them to take out home refinance loans against their will

D
They increase people's interest rates instead of lowering them

Note: Answer not sure
1. Report
Question: What is meant by Housing Expense Ratio?
A
The same as income to debt ratio

B
The percentage of living expenses to housing expenses

C
The percentage of monthly income that goes towards the housing payment

D
The ratio of the house price to those of other similar houses

Note: Answer not sure
1. Report
Question: Why is the repayment of a loan not considered income to the lender?
A
Because it only converts assets from receivables into cash

B
Because the amount is too small to impact tax collections

C
Because it is too complicated to track

D
Because there is no set law about how to handle it

Note: Answer not sure
1. Report
Question: When does a mortgage payer have to pay a late payment penalty?
A
When the payment is late by 4 days

B
When the payment is late by15 days

C
When the payment is late by the number of days stipulated in the loan agreement

D
Never

Note: Answer not sure
1. Report
Question: What is meant by Subprime Lending?
A
Mortgages aimed at the poor/uneducated people at higher interest rates

B
Mortgages aimed at the rich and wealthy

C
Mortgages offered at the fair market rate

D
Mortgages geared towards people with jobs

Note: Answer not sure
1. Report
Question: What typically happens if a borrower breaks one of the loan covenants?
A
Nothing

B
The loan becomes 'in default', and can be called by the lender

C
The borrower has to pay double the amount of the loan

D
The IRS will tax the borrower

Note: Answer not sure
1. Report

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Question: What is an unsecured loan?

Question: What does the term "Deferment" denote?

Question: What does the term "Endowment" mean?

Question: What can a lender do if a borrower refuses to pay back a loan?

Question: How do lenders abuse people who are looking to get their homes refinanced?

Question: What is meant by Housing Expense Ratio?

Question: Why is the repayment of a loan not considered income to the lender?

Question: When does a mortgage payer have to pay a late payment penalty?

Question: What is meant by Subprime Lending?

Question: What typically happens if a borrower breaks one of the loan covenants?