Miscellaneous Quiz / Financial and Loan Terms

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Can you name the Financial and Loan Terms?

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DefinitionTerm
A mortgage loan in which the principal, in addition to the interest payment is paid via periodic installments during the loan's term.
Paying the amount one owes before it is due. Although this can result in a savings on interest charges, it can result. a Prepayment Penalty.
An expert's opinion of a property's market value. This term can also refer to the process by which this opinion of value is obtained.
The written transfer of an interest in a lease or mortgage. The lessee (assignor) transfers the remainder of the term and the assignee becomes liable to the original lessor for the
Also known as a blanket mortgage, this type of loan covers more than one parcel of property. Usually, individual parcels are released or partially released from the blanket loan /
Bridge loans are loans intended to be used for a short period of time between the initial requirement for funds and a permanent, usually less costly, financial solution. Bridge loa
A broker is an intermediary who negotiates rates, handles paperwork, forms & legal items and serves the borrower. Brokers in hard money generally take between 1 and 4 'points' off
The interest rate that is thought to be an acceptable return on an investment
The process of finalizing the sale of property that includes the transfer of title from the seller to the buyer. All requirements, such as mortgages, are signed or delivered.
A security for the repayment of a loan. In the case of real estate, a piece of property is collateral to ensure the borrower's ability to repay what is owed.
Conduit lenders are relatively new to the lending industry. These conglomerates attempt to pool assets from different types and classes and sell them to other lenders or investors,
Commercial lenders offer a variety of mortgage-backed loans for commercial property. Each commercial lender sets economic, demographic and geographic criteria.
Of note: Avatar Financial CANNOT lend on raw land, however, here are some criteria to think about if you have a hard money deal on raw land. Hard money loans for raw land are a lit
The failure, for whatever reason, to make a payment or fulfill a commitment.
A borrower pays this amount at the time a loan is closed. The down payment is a percentage of the value of what a loan is going towards, and this amount is deducted from the amoun
The process of investigating the condition and legal status of assets.
The difference between the market value of a property and the claims held against it.
A legal clause that can be taken out by a mortgage borrower. The certificate verifies the major points of an existing lease between a landlord & tenant.
The overnight lending rate between banks as set by the United States' Federal Reserve Bank. The overnight lending rate influences the interest charged by banks to lend to one anoth
The regular payments (usually monthly) due on a mortgage loan. This includes payment of both principal and interest.
A legal term referring to the failure of a mortgagee to pay the amounts specified in the terms of the mortgage contract. In foreclosure, legal proceedings often determine that the
GSE - Government Sponsored Enterprises. These are lenders who focus exclusively on properties backed by government programs. These can include multi-family properties, senior citiz
A person who pledges collateral for the contract of another or who guarantees the performance of another.
Real estate is the primary collateralized asset for a hard money loan. Hard money refers specifically to the asset used to guarantee repayment. In the event of a default, hard mon
A lender who offers loan funding based on real estate as the primary collateral asset.
A Hard Money Loan is a loan in which real estate serves as the collateral asset.
To give property as security without relinquishing ownership of said property. A mortgage is a good example of a hypothecation.
DefinitionTerm
Property which produces income from rentals and profits.
A non-binding agreement between parties involved in a contract to move forward with negotiations or complete a project.
The BBA LIBOR is the most widely used benchmark or reference rate for short term interest rates. LIBOR stands for the London Interbank Offered Rate and is the rate of interest at
A charge upon property for the satisfaction or discharge of a debt.
A loan origination fee is the free charged by a broker for the broker's expertise in knowing which lender is likely to fund your loan and, in some instances, assisting you to prep
A loan originator is a broker who charges the service of locating borrowers and putting them together with an appropriate lender. The broker's (aka loan originator) fees are charg
Shown as a percentage, this is the relationship between the mortgage loan and the appraised value of the property.
The ratio of a loan amount against the value of the property being used as collateral. A property valued at $100,000 with a loan request against the asset of $50,000 would have a
Tha actual selling price of the property or land involved in a deal.
The written, estimated value obtained by factoring in location, assets, demand & supply. Estimates for market value are typically provided by a licensed appraiser for hard money d
Also known as a merchantable title, this is a title that is free from liens. It enables an owner to sell property freely and without complication.
A legal document that pledges a property to the lender as security for payment of a debt.
Assets minus liabilities of a company or individual. Here, assets include cash. Also referred to as shareholders' equity.
A non-conforming loan refers to a type of loan that does not meet bank standards for funding. Reasons can be as diverse as lack of sufficient credit to the unorthodox nature of the
A public officer who is authorized by the state government through a certification process to witness and verify certain documents (i.e., contracts, deeds, mortgages). Official af
A fee that a lender charges to perform credit checks, put together loan documents and inspect property.
A charge, usually given as a percentage, that is listed in the terms of a loan. Pre-payment fees are common in lending because without them, the lender does not make the return on
The amount borrowed or remaining unpaid. The part of the monthly payment that reduces the remaining balance of a mortgage.
The outstanding balance of principal on a mortgage not including interest or any other charges.
Signed by the borrower, this legally binding document promises repayment of the loan, listing, among other things, the terms of how the loan must be repayed and when it must be re
Land that has had no man-made improvements or alterations made to it. Man-made alterations include all structures, such as sewers and streets, as well as buildings.
REIT - Real Estate Investment Trust. Many hard money lenders are formed as a REIT, with either private individual investors or institutions funding the loans the company makes.
The Small Business Administration, managing financial, legal and business issues for small business in America. The SBA is a government organization under federal authority. For m
The Ownership Rights
Estimated price or value for a property. Officially this can be given only by a licensed appraiser.
A law by local or regional authority (government) that sets parameters for the uses of a property.

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