Transcript Real Estate Jeopardy - OnCourse Publishing

Real Estate QUIZMASTER
Definitions
Potpourri
Miscellaneous
Numerical
ARMs
100
100
100
100
100
200
200
200
200
200
300
300
300
300
300
400
400
400
400
400
500
500
500
500
500
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Real Estate QUIZMASTER
Definitions
Potpourri
Miscellaneous
Numerical
ARMs
100
100
100
100
100
200
200
200
200
200
300
300
300
300
300
400
400
400
400
400
500
500
500
500
500
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Definitions for 100
The rate that a bank
charges its most
creditworthy customers
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Definitions for 200
A stream of equal
payments occurring at
regular intervals of time
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Definitions for 300
The term for the type of
mortgage where the
regular monthly
payments completely
and exactly pay off all
the principal in over the
course of the loan
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Definitions for 400
The ratio of the present
value of the annuity to
the amount of each
payment
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Definitions for 500
The payment per dollar
of loan (including both
interest and principal
amortization)
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Potpourri for 100
Government Securities
can be used as a proxy
for ______ investments
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Potpourri for 200
The future value of
$20,000 which grows at an
annual interest rate of 12%
per year for two years
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Potpourri for 300
The amount of the loan supportable
by a commercial property with NOI of
$50,000, debt coverage ratio
requirement of 1.25 and current rates
at 9.0% for 25 years, with monthly
payments, ignoring loan to value
constraints is _____
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Potpourri for 400
A lender makes a $30,000
loan at 9.0% for 31 years with
monthly payments of $239.89.
To bring the APR up to 9.5%
_____ points must be charged,
assuming no prepayment
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
DAILY
DOUBLE
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Daily Double
Potpourri for 500
This “Rule” relates to the
amount of time or the interest
rate required for a present
value to double its value
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Miscellaneous for 100
MMC
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Miscellaneous for 200
P L A MS
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Miscellaneous for 300
Generally if mortgage
interest rates drop by more
than ____ basis points,
refinancing will save the
borrower money
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Miscellaneous for 400
R A M
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Miscellaneous for 500
L I B O R
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Numerical for 100
If we were indifferent between
receiving $3,500,000 today
and receiving $4,000,000 after
one year, our opportunity cost
of capital would be ______
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Numerical for 200
The effective cost of borrowing on
a $1,000,000 loan with 2 points,
10% amortizing over 25 years, and
prepayment expected in 15 years
with no prepayment penalty is ___
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Numerical for 300
The supportable loan for a
REIT with 8% interest, 25
year amortization and DCR
of 2, with an available cash
flow of $50,000,000 is
approximately ____
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Numerical for 400
A simple interest rate of
1.725% per month gives
an EAR of _____
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
Numerical for 500
OSLB after 10 years on a
$1,000,000 loan at 10%, 25
year mortgage will be _____
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
ARMs for 100
Typical Life Caps on
ARMs run _______ over
the course of the loan
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
ARMs for 200
In an ARM rate
calculation:
Contract – ??????
= Index
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
ARMs for 300
The most common
caps in ARMs are
_____ and Lifetime
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
ARMs for 400
The first year rate of an
ARM is often less than
the longer term expected
rate and is called a
____________ rate
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner
ARMs for 500
______ borrowers with
few liquidity concerns
will often opt for ARMs
“Real Estate Principles for the New Economy”: Norman G. Miller and David M. Geltner