Which of the following is an example of predatory lending that federal law prohibits?
Why Loan flipping — repeatedly refinancing a loan to generate fees without benefit to the borrower Is Correct
Answer B: Loan flipping — repeatedly refinancing a loan to generate fees without benefit to the borrower
Exam Tip: Finance
Finance questions often involve calculations. Master the T-bar method, understand the difference between conventional and government-backed loans, and know key ratios like LTV and DTI.
Key Finance Terms in This Question
People Also Study
Related Alaska Questions
- Which federal law prohibits lenders from requiring a borrower to use a specific title company or settlement service provider as a condition of the loan?Finance
- Which federal act prohibits lenders from discriminating in mortgage lending based on the racial composition of a neighborhood?Finance
- Which federal law requires lenders to provide borrowers with a Loan Estimate within three business days of receiving a loan application?Finance
- Which federal law requires lenders to provide borrowers with a Loan Estimate within 3 business days of receiving a complete loan application?Finance
- Which federal law prohibits lending discrimination based on a neighborhood's racial or ethnic composition?Fair Housing
Key Terms to Know
A professional estimate of a property's market value prepared by a licensed or certified appraiser.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Pre-ApprovalA lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.
Math Concepts
State-Specific Concepts
Study This Topic
Practice More Alaska Real Estate Questions
1,400+ questions covering all exam topics. Start free — no signup required.
Take the Free Alaska Quiz →