Common predatory mortgage lending practices include: (select all that apply) Question 4 options: prepayment penalties. loan flipping. loaning more than the borrower's ability to repay. excessive points.
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Common predatory mortgage lending practices include: (select all that apply)
Question 4 options:
|
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prepayment penalties. |
|
|
loan flipping. |
|
|
loaning more than the borrower's ability to repay. |
|
|
excessive points. |
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- Which of the following situations are likely to result in higher loan defaults? Mortgages are held by originating institutions in their portfolios. Borrowers have higher equity in their homes. Lenders who require documentation of income, liabilities and asset ownership. Borrowers with low credit scores.What is MOST TRUE of DEFAULT RISK on a mortgage loan? Group of answer choices It is always lower with lower interest rates. It increases with greater leverage. It increases with a lock-out provision. It does not effect the borrower due to lack of recourse.Which of the following does not relate to credit risks? a. Credit risk is the possibility of losing a lender takes on due to the possibility of a borrower not paying back a loan b. It refers to the risk that a lender may not receive the owed principal and interest c. Credit risk also describes the risk that an insurance company will be able to pay a claim. d. Credit risk is the possibility of a loss resulting from a borrower's failure to repay a loan or meet contractual obligations e. Credit risk describes the risk that a bond issuer may fail to make payment when requested
- 1. Explain how an installment loan differs from revolving credit in terms of risk and the nature of the return to the lender.Which of the following does not relate to credit risks? Select one: A. Credit risk is the possibility of a loss resulting from a borrower's failure to repay a loan or meet contractual obligations B. Credit risk also describes the risk that an insurance company will be able to pay a claim. C. It refers to the risk that a lender may not receive the owed principal and interest D. Credit risk describes the risk that a bond issuer may fail to make payment when requested E. Credit risk is the possibility of losing a lender takes on due to the possibility of a borrower not paying back a loanWhich of the following is true of an unsecured loan?A. They are exclusively for cars, houses, and other large purchasesB. Collateral could be collected by the lender if the debt is not paidC. They never have any interest added onto themD. Items of value that the borrowers owns are not at risk of repossession
- URGENT How does high interest rate and setting ceiling on loans (limited credit) compensate for the possibility of defaulting?Discuss the two theories of mortgage default. What are the most important factors that influence the likelihood of default? Discuss the alternatives to default from the lender’s perspective and the incentives lenders face to offer them.Collateral does not reduce the risk of a loan per se, becauseA. it is not part of the loan agreementB. the risk of a loan is determined by the borrower’s willingness and ability to repay the loanC. it may be worth less than the bank thinksD. the bank may not have title to the collateral
- Ways that a lender may respond to a defaulted loan without resorting to foreclosure include all of the following except Multiple Choice defer or forgive some of the past-due payments. accept a deed in lieu of foreclosure. allow short sale to a third party. accelerate the debt. offer credit counselina.Canceling the original loan and signing a new loan agreement with different terms to settle troubled debts is called what? a) Prolongation b )Settlement c) Nullification d) Continuation with modification of debt termsWhich of these statements is true? A)There is no reason to pay off a loan early B) when shopping for a loan, you need to compare only APRs C) the more you owe, the higher your interest payment will be D) you can save money by making the smallest down payment the lender will allow