Mortgage Loan Originator Mortgage Products and Programs

Question 1

What is the primary advantage of an FHA loan compared to a conventional loan for first-time homebuyers?

Accepted Answer

Lower minimum credit score and down payment requirements

Answer

No mortgage insurance is required

Answer

Higher loan limits in all markets

Answer

No income limits apply

Question 2

A VA loan is available to eligible veterans and active-duty service members and features which of the following unique benefits?

Accepted Answer

No down payment requirement and no private mortgage insurance

Answer

Fixed interest rates only

Answer

Available to all U.S. citizens

Answer

Maximum loan limit of $250,000

Question 3

USDA Rural Development loans are designed for borrowers who:

Accepted Answer

Meet income limits and are purchasing in eligible rural and suburban areas

Answer

Are purchasing properties in metropolitan areas only

Answer

Have credit scores above 740

Answer

Are first-time homebuyers with more than 20% down

Question 4

What distinguishes a 'jumbo loan' from a conforming loan?

Accepted Answer

Jumbo loans exceed the conforming loan limits set by FHFA

Answer

Jumbo loans are insured by the FHA

Answer

Jumbo loans require less documentation

Answer

Jumbo loans have lower interest rates

Question 5

A 5/1 ARM mortgage means:

Accepted Answer

The rate is fixed for 5 years, then adjusts annually

Answer

The rate is fixed for 1 year, then adjusts every 5 years

Answer

Payments are interest-only for 5 years then fully amortize over 1 year

Answer

The loan has a 5% rate cap and adjusts monthly

Question 6

Which mortgage program is specifically designed for purchasing and renovating a property in a single loan?

Accepted Answer

FHA 203(k) rehabilitation loan

Answer

203(b) standard FHA loan

Answer

VA IRRRL

Answer

USDA streamline refinance