Real Estate Notes: Georgia Exam Prep: Finance and Closing

In order to be a valid contract, the financing agreement must:

What are the security instruments used nationally?

What security instrument does Georgia use most of the time?

How many parties in the security deed?

What is the name of the clause, allowing the lender to foreclose, if necessary, via non-judicial foreclosure.

What’s true about the right of redemption in Georgia?

Who holds the promissory note while it’s being repaid?

What phrase or words are required on a deed and are considered an “act of conveyance”?

it accompanies the mortgage, deed of trust, or security deed is a contractual obligation in itself, whether or not there’s an attached security instrument.

The parties to a promissory note are

When the debt has been paid off, the lender should have the document marked

This section gives the lender “power of sale,” meaning the lender can sell the property without judicial proceedings if the borrower defaults.

This section simply states that if another borrower assumes the loan attached to the security deed, it doesn’t necessarily release the original borrower from liability for payment.

it allows the trustee (or the mortgagee, in the case of a mortgage) to sell the property in order to recover losses from borrower default using a non-judicial foreclosure process

it states that the buyer will regain full title once the debt is fully repaid

Instead of releasing the deed by signing the original deed, the lender may instead execute and record a document called

What’s the transfer tax on a Georgia home sold for $215,000 with a mortgage loan of $180,000?

Which lenders are covered by GAFLA?

What provisions are standard when any security instrument is used but are included in the promissory note rather than the security instrument?

In a deed of trust, who is the beneficiary?

Which of the following is a true statement about when a promissory note is sold?

Which clause in the deed of trust and Georgia’s security deed is the equivalent of the defeasance clause in the mortgage?

In a deed of trust, who is the trustee?

In Georgia, borrowers may redeem the property

On a security deed in Georgia, what is the borrower referred to?

Which clause is standard in a deed of trust or security deed and affects the foreclosure process that can be used if the borrower defaults?

In Georgia, who owns the property on the day of closing?

it requires borrowers to maintain escrow accounts to pay 1/12 of property taxes each month

it stipulates charges for loan payments received after their due date; usually noted in the promissory note attached to the security instrument

it describes default (borrower fails to make a payment or to abide by the terms of the agreement) and creates a consequence of making the entire debt immediately due and payable.

The lender must give the borrower at least _ from the date of notice to pay the entire debt owed.

it allows the lender to make the entire loan due and payable immediately if the property is sold or otherwise transferred; tends to be included with VA, USDA, and FHA loans (not conventional loans, which aren’t assumable)

it waives borrower’s right to claim the benefit of any homestead laws that would affect the lender’s rights to collect the debt

lenders will generally try to work with borrowers to remove a loan from default status. This may be referred to as

What is the trustee’s role when a deed of trust is used to secure property for a loan?

When a mortgage is sold, what happens?

When a borrower has paid off the loan, how is the release handled if the security instrument is a mortgage?

Financing for a real estate transaction can use a note with a , a note with a deed of trust, or, in Georgia, a note with a security deed.

How’s the Georgia intangible tax computed?

Borrower surrenders deed to the lender; doesn’t eliminate junior liens (as foreclosure would)

Lender forgives missed payments as long as the borrower has resumed making the required payments on time

Borrower pays all amounts owed (possibly entire loan amount); must occur within certain time frame

Borrower sells property for less than loan balance plus closing costs

Borrower work with lender to restructure or modify the terms of the loan agreement to be able to continue to make payments; sometimes called recasting the loan

Lender agrees to defer loan payments for a certain period of time; sometimes agreed to in situations like borrower job termination

Borrowers go through legal process to discharge or restructure their debts

Lender sells the security deed at a discount to an individual who is willing to deal with the borrower in default and to take the risk regarding the sales price at the foreclosure sale. Their relative positions in the negotiation rest on their knowledge of the market.

it will allow the lender to place a lien against any current or future property the borrower owns, until the losses are recovered. it will extend to co-signer

Does the FHA allows eficiency judgments for loans it insures?

Paid as an interest-only or partially amortized loan with a lump-sum payment, usually at the end of the loan term.

Federal agencies created this to assist first-time homebuyers facing rising house prices and rising interest rates.

a mortgage in which personal property is included with the real property in the sale. Commonly used in commercial real estate where business assets are included as collateral.

the agreement is between the seller and the buyer; the original borrower remains responsible for the debt, and the buyer makes payments to the seller.

it involves the seller’s existing mortgage and a buyer’s new mortgage. The new mortgage wraps around the existing mortgage, and the seller continues to make payments on the existing mortgage. The buyer makes payments to the seller that cover payments for both the existing and new mortgage loans.

it Passed in 2002 and substantially amended in 2003, it addresses predatory lending practices. it targets excessive fees, expands processes for high-cost loans, and imposes stiff penalties for anyone connected to a loan determined to be in violation of the act’s provisions.

Who is responsible for the transfer tax and how to calculate it?

Who is responsible for the intangible tax and how to calculate it?

A written deed in Georgia must contain the following elements and conventions:

What is the trustee’s role when a deed of trust is used to secure property for a loan?

Which real estate finance instrument in Georgia may include the pledging of collateral and the release of that collateral in the same document?

The clause is also known as a due-on-sale clause.

When a borrower fails to cure any default within 120 days of the lender’s original notification, the lender may begin the foreclosure process. In Georgia, borrowers may redeem the property __.

The document that describes the loan amount and the terms for repaying and is attached to a security instrument is called the .

Which clause in the deed of trust and Georgia’s security deed is the equivalent of the defeasance clause in the mortgage?

Andrea’s lender has notified her of its intent to foreclose. Her loan is secured with a security deed. What rights does she have to redeem her property?

Jacob lost his job in an economic slump and is behind on his mortgage. Georgia is a non-judicial foreclosure state. Which section of his security deed gives his lender to right to sell the property if he defaults?

Of the following, what is the main distinguishing feature between a mortgage, a deed of trust, and Georgia’s security deed?