The secondary mortgage market primarily functions to:
Why Buy existing mortgage loans from primary lenders, providing liquidity to the mortgage market Is Correct
Answer C: Buy existing mortgage loans from primary lenders, providing liquidity to the mortgage market
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 California Questions
- What is the primary purpose of the Truth in Lending Act (TILA) as it applies to California residential mortgage loans?Finance
- Which federal law prohibits lenders from discriminating against borrowers based on race, color, religion, national origin, sex, familial status, or disability when making mortgage loans?Finance
- What is the 'secondary mortgage market'?Finance
- In California, a deed of trust differs from a mortgage primarily because it:Finance
Key Terms to Know
Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
AmortizationThe gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Math Concepts
Study This Topic
Practice More California Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free California Quiz →