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Questions and Answers
A deed of trust involves two parties: the lender and the borrower.
A deed of trust involves two parties: the lender and the borrower.
False
In a conventional loan agreement, the lender cannot call in the loan if the borrower sells the property.
In a conventional loan agreement, the lender cannot call in the loan if the borrower sells the property.
False
A promissory note used for a real estate transaction is always accompanied by a security instrument.
A promissory note used for a real estate transaction is always accompanied by a security instrument.
True
Compound interest is computed annually on the remaining principal balance of a real estate loan.
Compound interest is computed annually on the remaining principal balance of a real estate loan.
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A mortgagor is not responsible for paying property taxes or maintaining property insurance.
A mortgagor is not responsible for paying property taxes or maintaining property insurance.
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When market interest rates increase, borrowers often choose to refinance to take advantage of the higher rates.
When market interest rates increase, borrowers often choose to refinance to take advantage of the higher rates.
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A deed of trust involves three parties: the lender, the borrower, and an independent trustee.
A deed of trust involves three parties: the lender, the borrower, and an independent trustee.
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Conventional loan agreements usually contain a defeasance clause allowing borrowers to assume the loan on original terms.
Conventional loan agreements usually contain a defeasance clause allowing borrowers to assume the loan on original terms.
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A promissory note for a real estate transaction is frequently accompanied by a mortgage or a deed of trust.
A promissory note for a real estate transaction is frequently accompanied by a mortgage or a deed of trust.
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When market interest rates decrease, borrowers often opt to refinance to benefit from the lower rates.
When market interest rates decrease, borrowers often opt to refinance to benefit from the lower rates.
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