Question 1

A(n)  ________ is an arrangement in which a third party promises to be secondarily liable for the payment of another's debt.

Accepted Answer

A)   guaranty arrangement
B)   surety arrangement
C)   insolvency arrangement
D)   accommodationE) A) and B)
F) B) and D)

Question 2

A lienholder must file a notice of lien with the county recorder's office in the county in which the real property subject to the lien is located.

Accepted Answer

A) True 
 B)False

Question 3

Credit that does not require any collateral to protect the payment of the debt is referred to as ________.

Accepted Answer

A)   unsecured credit
B)   secured credit
C)   fair credit
D)   equal creditE) A) and C)
F) B) and C)

Question 4

An improperly recorded document is effective against subsequent purchasers of real property.

Accepted Answer

A) True 
 B)False

Question 5

Creditors that violate the Consumer Leasing Act are subject to the civil and criminal penalties provided in the ________ Act.

Accepted Answer

A)   Truth-in-Lending
B)   Fair Credit Billing
C)   Fair Credit and Charge Card Disclosure
D)   Fair Debt Collection PracticesE) C) and D)
F) B) and D)

Question 6

Which of the following is true about a surety's liability to pay in a surety arrangement?

Accepted Answer

A)   The surety is secondarily liable for payment.
B)   The surety is primarily liable for payment.
C)   The principal debtor must be in default before the surety can be approached.
D)   The surety can only be approached as a last resort to the creditor.E) A) and B)
F) A) and C)

Question 7

Which of the following federal statutes requires creditors to disclose finance charges, including interest, points, and other fees paid?

Accepted Answer

A)   Fair Debt Collection Practices Act
B)   Consumer Financial Protection Act of 2010
C)   Mortgage Reform and Anti-Predatory Lending Act of 2010
D)   Truth-in-Lending ActE) All of the above
F) C) and D)

Question 8

The right of redemption only allows the redemption of a partial interest of the mortgagor.

Accepted Answer

A) True 
 B)False

Question 9

An arrangement in which a third party promises to be primarily liable with the borrower for the payment of the borrower's debt is referred to as a(n)  ________.

Accepted Answer

A)   garnishment
B)   accommodation
C)   surety arrangement
D)   guaranty arrangementE) C) and D)
F) B) and D)

Question 10

The proceeds from the sale of real or personal property authorized by a writ of execution are used to pay the creditor the amount of the final judgment.

Accepted Answer

A) True 
 B)False

Question 11

A recording statute gives potential purchasers of real property the ability to determine whether there are existing liens on a property.

Accepted Answer

A) True 
 B)False

Question 12

A power stated in a mortgage or deed that permits foreclosure without court proceedings and sale of the property through an auction is known as ________.

Accepted Answer

A)   reconveyance
B)   foreclosure sale
C)   power of sale
D)   garnishmentE) None of the above
F) B) and C)

Question 13

Which of the following is true of a guarantor in a guaranty arrangement?

Accepted Answer

A)   The guarantor is primarily liable to the principal debtor's debt when it is due.
B)   The guarantor can be approached even if the principal debtor is not in default.
C)   The creditor can seek first remedy from a guarantor.
D)   The guarantor has full legal rights to possession of the real property in this type of arrangement.E) A) and B)
F) All of the above

Question 14

Which of the following is designed put the burden on mortgage lenders to verify that a borrower can afford to repay the loan for which he or she has applied?

Accepted Answer

A)   Fair Credit Reporting Act
B)   Consumer Financial Protection Act of 2010
C)   Truth-in-Lending Act
D)   Mortgage Reform and Anti-Predatory LendingE) A) and B)
F) B) and C)

Question 15

In a deed of trust, the note is the instrument that evidences the borrower's debt to the lender.

Accepted Answer

A) True 
 B)False

Question 16

How does the Mortgage Reform and Anti-Predatory Lending Act of 2010 help regulate mortgage transactions?

Accepted Answer

The act requires mortgage originators an...

Question 17

A mortgage is a two-party instrument.

Accepted Answer

A) True 
 B)False

Question 18

A writ of attachment releases a property in the creditor's possession to the debtor.

Accepted Answer

A) True 
 B)False

Question 19

A postjudgment court order that permits the seizure of a debtor's property that is in the possession of third parties is known as the ________.

Accepted Answer

A)   writ of attachment
B)   writ of prohibition
C)   writ of exigent
D)   writ of garnishmentE) C) and D)
F) A) and B)

Question 20

A deficiency judgment protects a mortgagor from being personally sued in case there is a foreclosure sale deficiency.

Accepted Answer

A) True 
 B)False

Exam 26: Credit, Mortgages, and Debtors Rights

Which of the following is true about a surety's liability to pay in a surety arrangement?

Correct AnswerverifiedShow Answer

A recording statute gives potential purchasers of real property the ability to determine whether there are existing liens on a property.

Correct AnswerverifiedShow Answer

A(n) ________ is an arrangement in which a third party promises to be secondarily liable for the payment of another's debt.

Correct AnswerverifiedShow Answer

A deficiency judgment protects a mortgagor from being personally sued in case there is a foreclosure sale deficiency.

Correct AnswerverifiedShow Answer

Which of the following federal statutes requires creditors to disclose finance charges, including interest, points, and other fees paid?

Correct AnswerverifiedShow Answer

A postjudgment court order that permits the seizure of a debtor's property that is in the possession of third parties is known as the ________.

Correct AnswerverifiedShow Answer

How does the Mortgage Reform and Anti-Predatory Lending Act of 2010 help regulate mortgage transactions?

Correct AnswerverifiedThe act requires mortgage originators an...View AnswerShow Answer

Credit that does not require any collateral to protect the payment of the debt is referred to as ________.

Correct AnswerverifiedShow Answer

An arrangement in which a third party promises to be primarily liable with the borrower for the payment of the borrower's debt is referred to as a(n) ________.

Correct AnswerverifiedShow Answer

A lienholder must file a notice of lien with the county recorder's office in the county in which the real property subject to the lien is located.

Correct AnswerverifiedShow Answer

The proceeds from the sale of real or personal property authorized by a writ of execution are used to pay the creditor the amount of the final judgment.

Correct AnswerverifiedShow Answer

Creditors that violate the Consumer Leasing Act are subject to the civil and criminal penalties provided in the ________ Act.

Correct AnswerverifiedShow Answer

Which of the following is designed put the burden on mortgage lenders to verify that a borrower can afford to repay the loan for which he or she has applied?

Correct AnswerverifiedShow Answer

Which of the following is true of a guarantor in a guaranty arrangement?

Correct AnswerverifiedShow Answer

The right of redemption only allows the redemption of a partial interest of the mortgagor.

Correct AnswerverifiedShow Answer

A power stated in a mortgage or deed that permits foreclosure without court proceedings and sale of the property through an auction is known as ________.

Correct AnswerverifiedShow Answer

An improperly recorded document is effective against subsequent purchasers of real property.

Correct AnswerverifiedShow Answer

A mortgage is a two-party instrument.

Correct AnswerverifiedShow Answer

In a deed of trust, the note is the instrument that evidences the borrower's debt to the lender.

Correct AnswerverifiedShow Answer

A writ of attachment releases a property in the creditor's possession to the debtor.

Correct AnswerverifiedShow Answer

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The act requires mortgage originators an...
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