Financing, Loans, Trust Deeds and Credit Laws
Financing questions test loan types, sources, government programs, trust deeds, notes, financing laws, loan brokerage, and loan originators.
How to study for the California salesperson exam
Treat each item as a broker-practice problem: classify the property issue, identify the parties and duties, then apply California disclosure and contract rules.
Core concepts
Concept 1
California financing often uses a deed of trust structure with trustor, trustee, and beneficiary.
Exam cue: Name the loan instrument and security instrument.
Concept 2
Loan questions compare conventional, FHA, VA, seller financing, assumptions, and secondary-market concepts.
Exam cue: Separate borrower promise from pledged collateral.
Concept 3
Credit and loan brokerage rules protect borrowers from unlawful discrimination, steering, and improper fee practices.
Exam cue: For credit laws, reject discriminatory or misleading conduct.
Risk pitfalls and guardrails
Confusing mortgage and deed of trust parties.
Guardrail: Avoid answers that hide material facts, ignore broker supervision, confuse document types, or let custom override California law.
Treating discount points as a down payment.
Guardrail: Avoid answers that hide material facts, ignore broker supervision, confuse document types, or let custom override California law.
Ignoring loan originator or broker disclosure facts.
Guardrail: Avoid answers that hide material facts, ignore broker supervision, confuse document types, or let custom override California law.
Memory anchors
Promissory Note
A promissory note is the borrower's promise to repay debt.
Deed of Trust
A deed of trust pledges real property as security and involves trustor, trustee, and beneficiary.
Trustor
The trustor is the borrower under a deed of trust.
Beneficiary
The beneficiary is the lender under a deed of trust.
Trustee
The trustee has the limited powers stated in the deed of trust and law, including a qualifying power of sale.
FHA Loan
FHA insures qualifying loans made by approved lenders.
VA Loan
VA guarantees qualifying loans for eligible veterans or service members.
Conventional Loan
A conventional loan is not FHA-insured or VA-guaranteed.
Loan-to-Value
LTV equals loan amount divided by property value.
Discount Point
One discount point equals one percent of the loan amount.
Checkpoint rule
Do the check-up only after you can summarize each concept in one sentence and identify one dangerous pitfall from memory.
Knowledge Check (after reading)
Short check-up to confirm understanding of this module.
Check-up Questions
In a promissory note secured by real property, what does the note contain?
Under a California deed of trust, the borrower is the:
Answer all questions to submit.
Next step personalized recommendations
Continue learning
Move forward only after this module is stable.
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