Finance
In Texas, a 'wraparound mortgage' involves:
AA second mortgage that wraps around the first mortgage on a different property
BA new mortgage that includes an existing first mortgage, with the seller continuing to pay the original lender✓ Correct
CA mortgage that wraps around multiple properties in a portfolio
DA line of credit secured by multiple properties
Explanation
In a wraparound mortgage, a seller finances a buyer with a new, larger loan that 'wraps around' (includes) the existing first mortgage. The buyer makes one payment to the seller, who continues making the original mortgage payments. This is a form of seller financing that can trigger due-on-sale clauses.
Related Texas Finance Questions
- A 'bridge loan' in Texas real estate is typically used when:
- A Texas borrower with a 720 credit score and 5% down payment on a $300,000 home will most likely need:
- The Texas Bootstrap Loan Program provides:
- A Texas borrower with a 680 FICO score qualifies for a conventional loan at 5% down but will pay a higher PMI premium than a borrower with a 780 score. This difference reflects:
- In Texas, the homestead ad valorem tax cap for school taxes (ceiling) means a senior homeowner who qualified in 2010 at $3,500 tax will pay in 2024:
- The Texas Home Equity Loan/HELOC rules require that at least 12 days must pass between:
- Texas is a community property state. This means that property acquired during marriage:
- A Texas borrower receives a Loan Estimate (LE) within 3 business days of applying for a mortgage. The LE must include:
Practice More Texas Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Texas Quiz →