Florida Real Estate Broker Exam — All Questions

A mortgage loan that is neither insured by the FHA nor guaranteed by the VA is classified as:

• a.A blanket mortgage loan
• b.A purchase money mortgage loan
• c.A conventional loan✓
• d.A package mortgage loan

Conventional is defined by exclusion: any mortgage loan not insured by the Federal Housing Administration or guaranteed by the Department of Veterans Affairs, and therefore carrying no government backing of the lender's risk. Conventional loans above an 80 percent loan-to-value ratio typically require private mortgage insurance instead. The other three terms describe features of a loan rather than its government status. A purchase money mortgage is one the seller takes back as part of the price, a blanket mortgage covers more than one parcel and usually includes a release clause, and a package mortgage covers real property together with personal property such as appliances.

A buyer purchases a Florida home for $400,000 with a new 80 percent loan-to-value mortgage. The cash down payment is:

• a.$80,000✓
• b.$320,000
• c.$100,000
• d.$32,000

An 80 percent loan-to-value ratio means the lender advances 80 percent of value, here $320,000, leaving the buyer to supply the remaining 20 percent, which is $80,000. The $320,000 figure is the loan itself rather than the down payment, a substitution worth guarding against because the question asks what the buyer brings rather than what the lender lends. The $32,000 figure results from taking 20 percent of the loan instead of 20 percent of the price. The $100,000 figure would be a 25 percent down payment, which corresponds to a 75 percent loan-to-value ratio rather than the 80 percent stated.

Under Regulation Z, an advertisement stating only that a home may be bought for $2,000 down triggers a requirement to disclose:

• a.The lender's name, address, and identification number
• b.The seller's asking price and the property's assessed value
• c.The full credit terms, including the annual percentage rate✓
• d.The estimated closing costs the buyer is expected to pay

Regulation Z, implementing the federal Truth in Lending Act, treats certain specifics as trigger terms whose use in an advertisement requires the full credit terms to follow. The amount or percentage of any down payment is a trigger term, as are the number of payments, the period of repayment, the amount of any payment, and the amount of any finance charge. Once triggered, the advertisement must state the amount or percentage of the down payment, the terms of repayment, and the annual percentage rate. General statements such as easy financing available or low down payment are not trigger terms because they state no specific figure.

Under s. 817.545, F.S., mortgage fraud is a third-degree felony, but it becomes a second-degree felony when the stated loan value exceeds:

• a.$50,000
• b.$250,000
• c.$100,000✓
• d.$500,000

Section 817.545(5)(a), F.S., makes a violation of the mortgage fraud statute a felony of the third degree, and s. 817.545(5)(b), F.S., elevates it to a felony of the second degree where the loan value stated on documents used in the mortgage lending process exceeds $100,000. The offense itself is defined in s. 817.545(2), F.S., as knowingly, and with intent to defraud, making or using a material misstatement, misrepresentation, or omission during the mortgage lending process with the intention that it be relied on. Section 817.545(3), F.S., adds that an offense may not be predicated solely on information lawfully disclosed under federal disclosure laws.