NRES - Nevada Real Estate Salesperson Exam

Question 21: To purchase a home, a borrower signs a document that is a personal written promise to repay the borrowed money according to agreed terms of amount, interest, and schedule, and that is a fully negotiable instrument of debt. What is this document called?

A quitclaim deed

A promissory note

An estoppel certificate

A bill of sale

Question 22: In a lien-theory state, a borrower who pledges real estate as collateral for a loan keeps both legal and equitable title while giving the lender only a voluntary, specific lien enforceable by foreclosure on default. This two-party security instrument is called what?

A land lease

A security deposit

A homestead declaration

A mortgage

Question 23: In some states, a borrower conveys bare legal title to a neutral third party, who holds it on behalf of the lender until the debt is fully repaid, using a three-party security arrangement rather than a two-party one. What is this instrument called?

A deed of trust

A warranty deed

A trust certificate

A lien waiver

Question 24: In the three-party security instrument some states use instead of a mortgage, the borrower conveys title, a neutral party holds that title, and the lender holds the note and is entitled to repayment. What name is given to that lender?

The trustor

The trustee

The grantor

The beneficiary

Question 25: A borrower pledges real estate as security for a loan yet keeps possession, use, and control of the property, while the lender receives only an equitable interest and the right to force a sale upon default. This pledging arrangement is called what?

Subrogation

Hypothecation

Escheat

Novation

Question 26: This mortgage provision protects the lender by allowing it, once the borrower defaults, to declare the entire unpaid principal balance immediately due and payable, instead of having to sue separately over each individual missed payment. What is this provision called?

A habendum clause

An escalation clause

A reddendum clause

An acceleration clause

Question 27: To stop a buyer from taking over an existing low-interest loan, a lender inserts a provision letting it demand the full balance when the property is sold, or permit a takeover only at a rate the lender approves. What is this provision called?

A partition clause

An alienation clause

A habendum clause

A cognovit clause

Question 28: This provision in a financing instrument requires the lender, once the note has been paid in full, to execute a release returning to the borrower all interest in the real estate that had been pledged as security. What is this provision called?

A habendum clause

An exculpatory clause

A cognovit clause

A defeasance clause

Question 29: When a mortgage loan is finally paid in full, the lender executes and records a document showing that the debt is discharged and the lien removed from the property, so the public record is cleared. What is this mortgage-release document called?

A release of contingency

An estoppel certificate

A satisfaction of mortgage

A quitclaim deed

Question 30: To raise a loan's yield to the return an investor demands, a lender charges the borrower a one-time amount at closing, with each unit equal to one percent of the loan amount and treated as prepaid interest. What are these units called?

Impound reserves

Transfer taxes

Broker commissions

Discount points

Question 31: When a lender processes a mortgage application, it usually charges the borrower a fee of roughly one percent of the loan to cover the cost of generating the loan; unlike points, this charge is not treated as prepaid interest. What is this fee called?

A loan origination fee

A transfer tax

A yield premium

A closing reserve

Question 32: Many states set a legal maximum on the interest rate a private lender may charge on a loan, and charging any rate above that lawful ceiling is a specifically named illegal practice that can cost the lender interest or principal. What is this practice called?

Arbitrage

Escheat

Usury

Novation

Question 33: When a lender approves a real estate loan, it measures its risk by comparing the loan amount to the lesser of the property's sales price or appraised value, and expresses that comparison as a percentage. What is this percentage known as?

The debt-to-income ratio

The equity dividend rate

The amortization factor

The loan-to-value ratio

Question 34: Lenders describe a homeowner's basic monthly housing payment with a well-known four-part shorthand that combines the loan principal, the loan interest, the property taxes, and the property insurance into a single acronym. What do the four letters of that acronym stand for?

Price, interest, term, income

Payment, interest, title, insurance

Principal, interest, taxes, insurance

Principal, interest, term, income

Question 35: In the most common home loan, the borrower makes equal periodic payments, each applied first to the interest then due and next to the principal, so that the entire debt is reduced to zero by the end of the term. What is this loan called?

A wraparound loan

A blanket loan

An open-end loan

A fully amortized loan

Question 36: In this older loan form, the borrower pays only periodic interest throughout the term and then repays the whole principal in a single lump sum at the end; today it is used mainly for home improvements and second mortgages. What is this loan called?

A straight loan

A growing-equity loan

A package loan

A blanket loan

Question 37: When a loan's periodic payments are too small to retire the principal by the final due date, the last payment is much larger than all the others, and the loan is described as only partially amortized. What is that final, larger payment called?

A margin payment

A discount point

A balloon payment

A funding fee

Question 38: In an adjustable-rate mortgage, the interest rate is set by adding to a moving economic indicator a fixed percentage that represents the lender's cost of doing business and does not change over the loan's life. What is that fixed added percentage called?

The index

The margin

The cap

The point

Question 39: In states that permit it, a security instrument containing a power-of-sale clause lets the trustee sell the property after the borrower defaults and proper notice is given, all without any court action or lawsuit. What is this out-of-court process called?

Nonjudicial foreclosure

Judicial foreclosure

Strict foreclosure

Equitable redemption

Question 40: When a foreclosure sale fails to raise enough money to pay off the loan balance plus costs and unpaid interest, the lender may seek a personal court judgment against the borrower for the remaining shortfall. What is this personal judgment called?

A deed in lieu

A short sale

A redemption decree

A deficiency judgment

NRES Nevada Real Estate Salesperson Exam - Set 5 - Part 2

Question 21: To purchase a home, a borrower signs a document that is a personal written promise to repay the borrowed money according to agreed terms of amount, interest, and schedule, and that is a fully negotiable instrument of debt. What is this document called?

Question 22: In a lien-theory state, a borrower who pledges real estate as collateral for a loan keeps both legal and equitable title while giving the lender only a voluntary, specific lien enforceable by foreclosure on default. This two-party security instrument is called what?

Question 23: In some states, a borrower conveys bare legal title to a neutral third party, who holds it on behalf of the lender until the debt is fully repaid, using a three-party security arrangement rather than a two-party one. What is this instrument called?

Question 24: In the three-party security instrument some states use instead of a mortgage, the borrower conveys title, a neutral party holds that title, and the lender holds the note and is entitled to repayment. What name is given to that lender?

Question 25: A borrower pledges real estate as security for a loan yet keeps possession, use, and control of the property, while the lender receives only an equitable interest and the right to force a sale upon default. This pledging arrangement is called what?

Question 26: This mortgage provision protects the lender by allowing it, once the borrower defaults, to declare the entire unpaid principal balance immediately due and payable, instead of having to sue separately over each individual missed payment. What is this provision called?

Question 27: To stop a buyer from taking over an existing low-interest loan, a lender inserts a provision letting it demand the full balance when the property is sold, or permit a takeover only at a rate the lender approves. What is this provision called?

Question 28: This provision in a financing instrument requires the lender, once the note has been paid in full, to execute a release returning to the borrower all interest in the real estate that had been pledged as security. What is this provision called?

Question 29: When a mortgage loan is finally paid in full, the lender executes and records a document showing that the debt is discharged and the lien removed from the property, so the public record is cleared. What is this mortgage-release document called?

Question 30: To raise a loan's yield to the return an investor demands, a lender charges the borrower a one-time amount at closing, with each unit equal to one percent of the loan amount and treated as prepaid interest. What are these units called?

Question 31: When a lender processes a mortgage application, it usually charges the borrower a fee of roughly one percent of the loan to cover the cost of generating the loan; unlike points, this charge is not treated as prepaid interest. What is this fee called?

Question 32: Many states set a legal maximum on the interest rate a private lender may charge on a loan, and charging any rate above that lawful ceiling is a specifically named illegal practice that can cost the lender interest or principal. What is this practice called?

Question 33: When a lender approves a real estate loan, it measures its risk by comparing the loan amount to the lesser of the property's sales price or appraised value, and expresses that comparison as a percentage. What is this percentage known as?

Question 34: Lenders describe a homeowner's basic monthly housing payment with a well-known four-part shorthand that combines the loan principal, the loan interest, the property taxes, and the property insurance into a single acronym. What do the four letters of that acronym stand for?

Question 35: In the most common home loan, the borrower makes equal periodic payments, each applied first to the interest then due and next to the principal, so that the entire debt is reduced to zero by the end of the term. What is this loan called?

Question 36: In this older loan form, the borrower pays only periodic interest throughout the term and then repays the whole principal in a single lump sum at the end; today it is used mainly for home improvements and second mortgages. What is this loan called?

Question 37: When a loan's periodic payments are too small to retire the principal by the final due date, the last payment is much larger than all the others, and the loan is described as only partially amortized. What is that final, larger payment called?

Question 38: In an adjustable-rate mortgage, the interest rate is set by adding to a moving economic indicator a fixed percentage that represents the lender's cost of doing business and does not change over the loan's life. What is that fixed added percentage called?

Question 39: In states that permit it, a security instrument containing a power-of-sale clause lets the trustee sell the property after the borrower defaults and proper notice is given, all without any court action or lawsuit. What is this out-of-court process called?

Question 40: When a foreclosure sale fails to raise enough money to pay off the loan balance plus costs and unpaid interest, the lender may seek a personal court judgment against the borrower for the remaining shortfall. What is this personal judgment called?

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