Deck 11: Mortgage Forms and Provisions

Question 1

Mortgages are generally signed by the mortgagor.

Answer 1

True

Question 2

Most mortgages provide that a lender shall have a right to receive insurance and condemnation proceeds in the event of a casualty or taking of the secured property.

Answer 2

True

Question 3

A construction loan agreement by its terms will make the lender an agent of th e borrower and responsible for the construction or the payment of the costs of the construction.

Answer 3

False

Question 4

A real estate loan in which the borrower is not personally responsible for the repayment of the loan is an exculpated loan.

Question 5

A provision in a mortgage that requires a borrower to pay to the lender 1/12th of the taxes and
1/12 of the insurance premium with each mortgage payment is known as an escrow provision.

Question 6

A legal document that creates a security interest in personal property is known as a financing statement.

Question 7

Mortgages are generally signed by the mortgagee.

Question 8

A legal document that creates a security interest in personal property is known as a security agreement.

Question 9

If the personal property described in a financing statement includes fixtures, the UCC -1 financing statement must be filed in the county of the debtor's residence.

Question 10

If personal property consists of fixtures, the UCC financing statement must be filed in the county where the real estate is located on which the fixtures are attached.

Question 11

A provision in a mortgage that requires a borrower to pay to the lender 1/12th of the taxes and 1/12 of the insurance premium with each mortgage payment is known as a habendum provision.

Question 12

A real estate loan in which the borrower is not personally responsible for the repayment of the loan is a construction loan.

Question 13

It is legally permissible for a lender to prohibit the sale of the mortgaged property without the
lender's consent.

Question 14

The provision in a construction loan agreement that requires that a certain percentage of the
loan proceeds be held and not disbursed until completion of construction is known as an e scrow provision.

Question 15

The "due on sale" provision in a mortgage means that if the mortgage is sold, the debt secured
by the mortgage will become due and payable.

Question 16

Mortgages are generally signed by both mortgagor and mortgagee.

Question 17

The provision in a construction loan agreement that requires that a certain percentage of the loan proceeds be held and not disbursed until completion of construction is known as a retainage provision.

Question 18

Construction loan agreements commonly provide that a lender will have a right to take possession of the real property in the event of default and complete the construction.

Question 19

It is unusual for a mortgage to provide that the mortgagee shall have any claim to insurance proceeds payable as a result of a casualty of the secured property.

Question 20

A construction loan agreement will generally require that the borrower submit proof that all utilities such as water, electricity, and gas are available to the property.

Question 21

An assignment of rents and leases is generally signed only by the property owner.

Question 22

The debtor's signature is no longer required on a UCC -1 financing statement.

Question 23

A cross-default means that a default under one provision of a mortgage will constitute a default under another provision of the mortgage.

Question 24

Some states permit UCC-1 financing statements to be filed electronically.

Question 25

An assignment of rents and leases must be executed by the property owner and all of the tenants.

Question 26

A cross-default means that a default under one loan document such as a mortgage would constitute a default under another loan document such as an assignment of rents.