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P3-113 quiz

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Question 1 of 12

1. Question

What is a multi-width manufactured housing unit?

A) A manufactured home created by joining two or more single-width sections or stacking them
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B) A mobile home that cannot be transported
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C) A site-built home with modular components
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D) A commercial warehouse converted to housing
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Question 2 of 12

2. Question

What is negative amortization?

A) A rapid reduction of the mortgage balance
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B) A payment schedule where interest is forgiven
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C) A payment plan requiring biweekly installments
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D) An increase in mortgage debt because the payment is insufficient to cover interest
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Question 3 of 12

3. Question

What is net cash flow?

A) Gross rental income before expenses
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B) Monthly revenue minus only principal payments
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C) Income remaining after monthly operating income is reduced by monthly housing expense
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D) Total profit after selling an investment property
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Question 4 of 12

4. Question

What does net worth represent?

A) Total liabilities of a borrower
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B) Assets minus liabilities, indicating financial strength
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C) Total cash flow from investments
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D) Annual taxable income
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Question 5 of 12

5. Question

What is net yield?

A) The portion of gross yield remaining after deducting all costs and reserves
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B) Yield before operating expenses
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C) The interest rate listed on the promissory note
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D) The gross amount of rental income divided by 12
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Question 6 of 12

6. Question

What is a no cash-out refinance?

A) A refinance where the borrower receives over 10% cash back
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B) A refinance used only for investment properties
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C) A refinance requiring a full home renovation
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D) A refinance where the new mortgage only covers unpaid principal, closing costs, certain liens, and up to 1% cash to borrower
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Question 7 of 12

7. Question

What is a non-traditional mortgage?

A) Any mortgage product other than a 30-year fixed rate mortgage
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B) A mortgage issued only by private lenders
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C) Loans requiring no documentation
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D) Loans guaranteed by the government
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Question 8 of 12

8. Question

What is a notary public?

A) A court-appointed judge
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B) A mortgage underwriter
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C) A public officer authorized to attest and certify documents, take affidavits, and protest instruments
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D) A title insurer
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Question 9 of 12

9. Question

What is a note in mortgage lending?

A) A property deed showing ownership
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B) A written promise to pay a stated amount on a specific date (promissory note)
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C) A borrower’s credit report
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D) A mortgage insurance certificate
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Question 10 of 12

10. Question

What was the role of the Office of Thrift Supervision (OTS)?

A) To regulate credit unions
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B) To manage FHA mortgage programs
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C) To oversee private mortgage insurers
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D) To regulate the thrift (savings and loan) industry
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Question 11 of 12

11. Question

What is an open-end mortgage?

A) A mortgage allowing the outstanding loan amount to be increased upon mutual agreement
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B) A mortgage with no closing costs
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C) A mortgage paid off in one lump sum
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D) A temporary construction-only loan
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Question 12 of 12

12. Question

What are operating expenses for investment property?

A) Only mortgage insurance and property taxes
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B) Only repairs and utilities
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C) Costs of maintaining an investment property such as utilities, repairs, fees, and reserves
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D) Depreciation for tax purposes only
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