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Number 1. The payment that a potential borrower submits along with a loan application. These fees are paid to cover some of the time and resources that will be expended to review an application.
Correct Answer: Application Fee
Number 2. The cost or charge for an appraisal which is commissioned to determine the fair market value of a property.
Correct Answer: Appraisal Fee
Number 3. A payment that is made to "purchase" a forward agreement to provide capital or perform some specified activity assuming certain conditions or requirements are satisfied; may be refundable or nonrefundable depending on the contract and binding law.
Correct Answer: Commitment Fee
Number 4. A charge for the commitment of construction loan expressed in terms of a percent (or points, with each point representing 1/100 of a percent) against the total construction loan commitment.
Correct Answer: Construction Fee
Number 5. A "good faith" estimate of the costs associated with a loan closing, with limits and disclosure requirements set by the Real Estate Settlement and Procedures Act to protect borrowers from unexpected surprises that leave them short on cash and rendering them unable to close a loan.
Correct Answer: Estimated Closing Costs
Number 6. The up-front charges that are exacted by a lender to cover the costs of originating, underwriting and initiating a loan.
Correct Answer: Financing Points
Number 7. Unscheduled loan charges which are triggered by late payments that deviate from scheduled due dates or are insufficient to meet obligations. These payments or charges may be set at some minimal threshold amount or may be set as a percent of the missed payment.
Correct Answer: Late Fees
Number 8. An upfront charge made by a lender to justify the forward commitment of capital and helps offset the underwriting and loan processing charges.
Correct Answer: Loan Fee
Number 9. A monthly payment that is made to provide mortgage insurance protection in conjunction with the mortgage payment occurring when the loan to value rate is 80% or more.
Correct Answer: Mortgage Insurance Premium (MIP)
Number 10. The total costs of a mortgage including interest rates, points, and fees.
Correct Answer: Mortgage Price
Number 11. A mortgage agreement in which all closing and settlement costs other than periodic payments or deposits are paid by the seller or lender resulting in no additional payments by the borrower.
Correct Answer: No-cost Mortgage
Number 12. A fee that is charged by a mortgage broker as compensation for helping secure a loan that culminates in a transaction between a lender and a borrower.
Correct Answer: Placement Fee
Number 13. In a mortgage context, the quotes in terms of rates and fees provided to mortgage loan officers and mortgage brokers. The quoted prices are not binding and may differ at closing on individual mortgages.
Correct Answer: Posted Prices
Number 14. A charge invoked by a lender to offset the potential erosion in earnings caused by an early repayment of a mortgage or loan.
Correct Answer: Prepayment Penalty
Number 15. The payments that are made among various service providers as compensation or an economic reward for referring business.
Correct Answer: Referral Fees
Number 16. The total costs that a borrower must cover at a loan closing including all fees, discounts, and downpayments. The amount of such charges must be disclosed in advance in compliance with the Real Estate Settlement and Procedures Act.
Correct Answer: Settlement Costs
Number 17. Consideration which is paid or deposited to secure a forward commitment for a standby loan that is due and payable regardless of whether the loan is taken down.
Correct Answer: Standby Fee