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CHAPTER XIV
Managing your mortgage
  1. Private mortgage insurance (PMI) is a permanent fixture of your mortgage payment if you have a(n) ____ loan.

    a) subprime
    b) FHA
    c) jumbo
    d) VA
    e) assumable
  2. When a borrower’s mortgage balance drops to ____ percent of the property’s appraised value, the mortgage servicers are required to cancel PMI for them.

    a) 78
    b) 80
    c) 90
  3. Which of the following would help you to meet the 80 percent loan-to-value test and remove PMI from your mortgage payments?

    a) Excellent payment history and extra payments towards principal.
    b) Renovation of your home.
    c) Getting a competitive market analysis of your home’s value.
    d) Refinancing your home with a different lender.
    e) All of the above
  4. True or false: The PMI law allows lenders to continue requiring high-risk borrowers to pay PMI until their balances shrink to 50 percent loan-to-value ratios.

    a) True
    b) False
  5. Which of the following definitions best describes a rate-and-term refinance?

    a) A refinance transaction in which the amount of money received from the new loan exceeds the total of the money needed to repay the existing first mortgage, closing costs, points and the amount of any outstanding liens.
    b) The process of paying off one loan with the proceeds from a new loan using the same property as security, and taking advantage of lower interest rates, or a shorter term to build equity faster.
    c) A loan that allows the borrower to obtain multiple advances of the loan proceeds at his or her own discretion, up to an amount that represents a specified percentage of the borrower's equity in a property.
  6. Which of the following is often the best source for a refinance?

    a) community bank
    b) online lender
    c) original lender
    d) credit union
  7. True or false: Lenders can make more money by foreclosing on mortgages, so you can expect little help from your lender if you have a financial crisis.

    a) True
    b) False
  8. The best move to make if you know you’re going to miss a mortgage payment is to:

    a) Panic. Avoid all phone calls from your lender.
    b) Bury your head in the sand and ignore your lender’s phone calls.
    c) Call your lender immediately and establish a repayment plan.

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TABLE OF CONTENTS

CHAPTER I
  Lesson 1
  Quiz

CHAPTER II
  Lesson 2
  Quiz

CHAPTER III
  Lesson 3
  Lesson 4
  Lesson 5
  Quiz

CHAPTER IV
  Lesson 6
  Lesson 7
  Quiz

CHAPTER V
  Lesson 8
  Lesson 9
  Quiz

CHAPTER VI
  Lesson 10
  Lesson 11
  Quiz

CHAPTER VII
  Lesson 12
  Lesson 13
  Lesson 14
  Quiz

CHAPTER VIII
  Lesson 15
  Lesson 16
  Lesson 17
  Lesson 18
  Quiz

CHAPTER IX
  Lesson 19
  Quiz

CHAPTER X
  Lesson 20
  Quiz

CHAPTER XI
  Lesson 21
  Quiz

CHAPTER XII
  Lesson 22
  Lesson 23
  Lesson 24
  Quiz

CHAPTER XIII
  Lesson 25
  Lesson 26
  Lesson 27
  Quiz

CHAPTER XIV
  Lesson 28
  Lesson 29
  Lesson 30
  Quiz

Definitions

 
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