1. A “short sale” of real estate is:
(A) A sale that closes in less than 30 days
(B) The sale of a house by someone who is not the owner; it is a way to profit from an anticipated decline in real estate prices
(C) A sale in which the proceeds from the sale are less than the balance owed on the loan secured by the property sold
(D) A sale in which the balance owed on the loan secured by the property sold is less than the proceeds from the sale
2. A property is encumbered as follows:
First mortgage, A: $250,000
Second mortgage, B: $40,000
Third mortgage, C: $10,000
How much can mortgagee B pay for the property at a foreclosure sale without having to raise additional funds?
(A) $290,000
(B) $40,000
(C) $300,000
(D) $50,000
3. What is usually executed at the same time as a mortgage and creates the obligation to repay the loan in accordance with its terms?
(A) Recording acts
(B) Ownership interests
(C) Method of payment
(D) Promissory note
4. When is seller financing NOT used?
(A) The seller desires to take advantage of the installment method of reporting the gain from sale
(B) The buyer does not qualify for long term mortgage credit because of low down payment or difficulty meeting monthly payments
(C) Third-party mortgage financing is less expensive or easily available
(D) The seller desires to artificially raise the price of the property by offering a lower-than-market interest rate on the mortgage.