Illinois Real Estate Broker Exam — All Questions
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2 questions
Financing
In a mortgage loan, the clause that allows the lender to demand the entire remaining balance immediately upon the borrower's default is the:
- a.Defeasance clause
- b.Subordination clause
- c.Acceleration clause✓
- d.Alienation clause
The acceleration clause lets the lender declare the full unpaid balance due if the borrower defaults. The alienation (due-on-sale) clause, by contrast, is triggered by transfer of the property, not by default.
Financing
Which federal law requires lenders to disclose the annual percentage rate (APR) and total finance charges so consumers can compare credit costs?
- a.Truth in Lending Act (Regulation Z)✓
- b.RESPA
- c.Equal Credit Opportunity Act
- d.Fair Housing Act
The Truth in Lending Act, implemented by Regulation Z, requires disclosure of the APR and finance charges so borrowers can compare the true cost of credit. RESPA governs settlement cost disclosures, not APR.