Conventional Financing: Definition & Requirements

Instructions:

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question 1 of 3

What are the 3 Cs of conventional finance underwriting?

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1. What minimum loan-to-value ratio do lenders want on a conventional mortgage?

2. What does private mortgage insurance do?

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About This Quiz & Worksheet

Particular guidelines exist for obtaining conventional financing. The quiz asks you about basic facts and rules related to this method of receiving a loan.

Quiz & Worksheet Goals

For the quiz you will:

  • Name the three C's of conventional finance underwriting
  • Provide the minimum loan-to-value ratio sought by lenders for a conventional mortgage
  • Explain the purpose of private mortgage insurance
  • Give the definition of conventional lending
  • Describe the meaning of capacity

Skills Practiced

  • Information recall - access your knowledge to name the three C's related to conventional finance underwriting
  • Defining key concepts - ensure that you can properly define main terms, such as conventional lending and capacity
  • Reading comprehension - show that you are able draw the most essential information from the lesson on conventional financing

Additional Learning

Supplement your understanding by reviewing the lesson named Conventional Financing: Definition & Requirements. Lesson objectives include:

  • Describe the three C's in detail
  • Tell what is meant by the loan-to-value ratio (LTV)
  • Explain how private mortgage insurance is paid
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