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2.
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Which of the following is NOT one of the three main
types of reverse mortgages?
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a) single-purpose reverse mortgage
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b) proprietary reverse mortgage
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c) home-leaver reverse mortgage
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d) federally insured reverse mortgage
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3.
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Which of the following types of reverse mortgages is
generally the most expensive?
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a) proprietary reverse mortgage
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b) federally insured reverse mortgage
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c) Home Equity Conversion Mortgage
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d) single purpose reverse mortgage
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4.
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To qualify for most reverse mortgages,
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a) the value of your home must be less than or equal to the
median home value in your area.
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b) your home can have only one owner.
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c) your home must be debt-free when you apply.
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d) all owners must be 62 years of age or older.
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5.
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Reverse mortgages typically produce
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a) adjustable-rate debt and fixed equity.
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b) decreasing debt and rising income.
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c) rising debt and falling equity.
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d) fixed debt and rising interest.
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6.
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The amount of cash available from a reverse mortgage
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a) depends on the borrower’s total monthly income
from all sources.
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b) depends on how many people are occupying the home.
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c) is lesser when the loan applicant's age is lower.
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d) is greater when interest rates are higher.
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7.
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Loan advances can make a borrower ineligible for SSI and
Medicaid if they
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a) exceed $3,000 for a couple or $2,000 for an individual.
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b) are retained by a borrower in a bank account past the
end of the month.
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c) exceed $3,000 for a couple or $2,000 for an individual
and are spent before the end of the month.
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d) are retained by the borrower in a bank account past the
end of the month, causing the borrower's total liquid
assets to exceed $3,000 for a couple or $2,000 for an
individual.
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8.
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A reverse mortgage could become due and payable because
of which of the following circumstances?
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a) The borrower fails to pay property taxes.
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b) The borrower fails to maintain and repair the home.
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c) The borrower fails to keep the home insured.
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d) The borrower abandons the home
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e) All of the above.
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9.
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The "non-recourse" limit on a reverse mortgage
means
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a) your debt cannot be greater than the home's value.
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b) the lender may seek repayment from your income or your
other assets, but not your heirs.
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c) your debt is limited by the median home value in your
area.
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d) your heirs only have to pay back the part of your debt
that is greater than the home's value.
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10.
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Single-purpose reverse mortgages
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a) are most often offered by banks and mortgage companies.
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b) are generally available only to high-income homeowners.
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c) are generally the lowest-cost type of reverse mortgage.
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d) can be used for any single purpose.
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11.
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A basic requirement of the HECM program is that
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a) your home must meet Universal Home Modification
standards.
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b) your home must meet FHA energy efficiency standards.
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c) your home must meet HUD minimum property standards.
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d) your liquid assets must be less than $3,000 (not
including your home, your automobile or an irrevocable
burial trust).
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12.
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203-b limits refer to
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a) the statute in the Fair Lending Act that governs reverse
mortgages.
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b) the tax form that reverse mortgage holders are required
to complete under the 2000 Tax Reform Act.
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c) the cap on reverse mortgage borrowing that limits loan
amounts to $203,000.
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d) equity limits based on a county's median home value.
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13.
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The amount of cash remaining available to you in a HECM
creditline
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a) remains the same until the next time you make a
withdrawal.
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b) equals the original creditline amount minus all your
withdrawals.
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c) grows smaller each month by the current 10-year Treasury
rate plus the lender's margin.
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d) grows larger each month by the same total rate that is
being charged on your loan balance.
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14.
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For most homeowners, proprietary reverse mortgages
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a) are less costly than HECMs.
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b) are more secure than HECMs.
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c) provide less cash than HECMs.
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d) are more readily available than HECMs.
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15.
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After closing a reverse mortgage, you may
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a) cancel the deal at any time.
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b) cancel the deal in writing within three business days
after closing.
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c) not cancel the deal under any circumstances.
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d) call to cancel the deal any time within the first 30
days after closing.
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