Once a Loan Application Is Signed, the Lender Begins a Process

question 14

Multiple Choice

Once a loan application is signed, the lender begins a process that typically includes ordering the fee appraisal, the title report, and a number of third party inspection, compliance, and engineering reports in an attempt to make sure the potential borrower did not misrepresent the property in any way in the original loan submission package. This process is more commonly referred to as:

• A) Due diligence
• B) Loan submission
• C) Loan development
• D) Defeasance

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Definitions:

Operating Cash Flow

The amount of cash generated by a company's regular business operations, indicating its ability to pay bills and fund operations.

Depreciation

A method to allocate a portion of the original cost of an asset to expense over its expected useful life to reflect its decreasing value.

Tax Rate

The slice of a corporation's or individual's income designated for tax.

Annual Costs

The total expenses incurred by an individual or organization over the course of a year.