a. Regulation Z requires that borrowers be notified of their annual percentage rate, which takes into account not only the simple interest rate but also other financing costs, such as points.
c. The lender who does not receive full payment after foreclosure of a loan on this type of property may seek a deficiency judgment against the borrower.
a. Anna’s is actually a quadruple net lease, because she pays all the expenses on the building.
a. A periodic estate automatically renews itself (for example, month after month) until either landlord or tenant gives notice to terminate it.
c. Rental rates are set by supply and demand.
a. The cost approach is usually the most accurate for unique buildings and those newly constructed.
c. External obsolescence refers to outside factors (a nearby landfill, unemployment in the community) that affect the value of the subject property.
d. Economic obsolescence is caused by factors outside the property and is considered incurable.
c. The CMA, competitive market analysis, is a simple analysis intended to assist a seller in determining an asking price for the property.
b. Points are paid on the amount borrowed, not the selling price. The buyers are borrowing 90% of the sale price, or $162,000. Each point is 1% of that figure, so three points are $162,000 × 0.03 = $4,860.
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