Top 100+ Mortgage Bank Interview Questions And Answers

Question 1. What Is Start-up Loans?

Answer :

This sort of Loan is obtainable to borrower to begin their commercial enterprise and may be used to construct a storefront, to accumulate stock or pay franchise costs to get a business rolling.

Question 2. What Is Checking Account?

Answer :

You can get entry to the account because the saving account but, not like saving account, you can not earn interest in this account. The gain of this account is that there's no restriction for withdrawal.

Modern Banking Interview Questions
Question three. What Is Investment Management System?

Answer :

It is a procedure of managing money, including investments, banking, budgeting and taxes.

Question 4. What Is Payday Loan?

Answer :

A pay-day mortgage is typically, a small amount and a quick-term mortgage to be had at high interest price. A borrower usually writes submit-dated cheques to the lender in admire to the amount they wish to borrow.

The Mystery of Banking Tutorial
Question 5. What Is Credit Management System?

Answer :

Credit control system is a machine for handling credit score bills, assessing dangers and figuring out how much credit score to provide to the purchaser.

Banking Interview Questions
Question 6. What Is Financial Management System?

Answer :

Financial management device is used to control and preserve a record of its earnings, price and belongings and to hold the responsibility of its profit.

Question 7. What Do You Mean By Term 'usury'?

Answer :

When a loan is charged with high hobby rate illegally then it is referred as 'Usury'. Usury charges are generally set via State Law.

Modern Banking Tutorial Bank Clerk Interview Questions
Question eight. What Is Loan Management System?

Answer :

The database collects all the information and continues the song about the customers who borrows the money.

Question 9. What Is Retail Or Consumer Banking?

Answer :

It is a small to mid-sized department that without delay offers with consumer's transaction in preference to corporate or other banks

Banking Operations Interview Questions
Question 10. What Do You Mean By Co-maker?

Answer :

A character who signs and symptoms a observe to assure the payment of the mortgage on behalf of the main loan applicant's is known as co-maker or co-signer.

Question 11. What Is Corporate Or Business Banking?

Answer :

Corporate banking deals with coins control, underwriting, financing and issuing of shares and bonds

HDFC Bank Interview Questions
Question 12. What Is Inter-financial institution Deposit?

Answer :

Any deposit this is held by way of one bank for some other bank is called inter-financial institution deposit. The financial institution for which the deposit is being held is referred because the correspondent financial institution.

Modern Banking Interview Questions
Question thirteen. What Is Negative Amortization?

Answer :

When compensation of the loan is less than the loans amassed interest, then negative Amortization takes place. It will increase the loan quantity in place of lowering it. It is likewise referred to as 'deferred interest'.

Question 14. What Is 'amortization'?

Answer :

The compensation of the mortgage by means of instalment to cover predominant amount with interest is referred to as 'Amortization'.

Question 15. What Is Atm Banking (automated Teller Machine)?

Answer :

It is an electronic banking outlet, which lets in clients to finish primary transaction.

IBPS Bank PO and Clerk Interview Questions
Question 16. What Is Stock Market Management System?

Answer :

The stock marketplace management is a system that manages economic portfolio like securities and bonds.

Question 17. What Is Non-traditional Options?

Answer :

There are many non-financial institution entities that provide monetary offerings like that of the financial institution. The entities encompass credit card agencies, credit card record agencies and credit score card issuers.

Syndicate Bank Interview Questions
Question 18. What Is 'credit score-netting'?

Answer :

A gadget to lessen the number of credit checks on economic transaction is referred to as credit score-netting. Such settlement takes place generally between large banks and other economic institutions. It locations all of the destiny and current transaction into one agreement, casting off the need for credit cheques on each transaction.

Banking Interview Questions
Question 19. What Is The Card Based Payments?

Answer :

There are two varieties of card bills

Credit Card
Debit Card
Question 20. What 'libor' Stands For?

Answer :

'LIBOR' stands for London Inter-Bank Offered Rate. As the name propose, it's miles an average interest price offered for U.S greenback or Euro dollar deposited between organizations of London banks. It is an international interest rate that follows global monetary condition and used as a base rate with the aid of banks to set interest charge. LIBOR comes in eight maturities from in a single day to 12 months and in five distinctive currencies. Once in a day LIBOR proclaims its interest fee.

Investment Banking Interview Questions
Question 21. What Is 'bill Purchase'?

Answer :

In 'Bill Purchase' the mortgage can be created for the overall price of the draft and the interest could be recovered while the actual charge comes. For instance, a 'Sight draft' is offered for which the loan is created for one hundred% of the draft price. The money is received after 7 days, and then the interest could be recovered for 7 days along with the principal quantity.

Question 22. What Is Saving Account?

Answer :

You can shop your cash in such account and additionally earn hobby on it. The quantity of withdrawal is restrained and want to keep the minimum amount of stability in the account to remain lively.

Question 23. What Is Small Business Administration Loans?

Answer :

It is a Federal Agency (U.S) that offers investment to small companies and entrepreneurs. SBA (Small Business Administration) loans are made via banks, credit unions and other creditors who companions with SBA.

Citi Bank Interview Questions
Question 24. What Do You Mean By Term 'mortgage Maturity' And 'yield'?

Answer :

The date on which the principal quantity of a loan becomes due and payable is referred to as 'Loan Maturity'. Yield is generally referred as the dividend, interest or go back the investor gets from a safety like stock or bond, interest on fix deposit and many others. For instance, any funding for $10,000 at hobby price of four.25%, will come up with a yield of $425.

Bank Clerk Interview Questions
Question 25. What Ach Stands For?

Answer :

ACH stands for Automated Clearing House, that is an electronic transfer of budget among banks or financial establishments.

Question 26. What Is Debt-to-profits Ratio?

Answer :

The debt-to-earnings ratio is calculated by dividing a mortgage applicant's total debt price with the aid of his gross earnings.

Bank Branch Manager Interview Questions
Question 27. What Is Money Market Account?

Answer :

This account offers advantages of both saving and checking accounts. You can withdraw the quantity and but you can earn higher hobby on it. This account may be opened with a minimal balance.

Banking Operations Interview Questions
Question 28. What Is Core Banking System?

Answer :

Core banking is a service supplied by way of a networked financial institution branches. With this, patron can withdraw money from any department.

Question 29. What Is Cost Of Funds Index (cofi)?

Answer :

COFI is an index this is used to decide interest quotes or changes within the hobby fees for sure sorts of Loans.

ICICI Bank Interview Questions
Question 30. What Is 'loan Grading'?

Answer :

The category of mortgage based totally on diverse dangers and parameters like repayment danger, borrower's credit records and so forth. Is referred to as 'mortgage grading'. This system places loan on one to six classes, based totally on the stability and hazard related to the loan.

Question 31. What Is (apr) Annual Percentage Rate?

Answer :

APR stands for Annual Percentage Rate, and it's far a price or hobby that the financial institution imposes on their clients for the use of their services like loans, credit score playing cards, loan mortgage and so forth. The interest charge or charges imposed is calculated yearly.

Question 32. What Is 'high Rate'?

Answer :

Basically, 'prime rate' is the rate of interest this is decided by using nations (U.S.A) largest banks for his or her favored clients, having a good credit score score. Much 'variable' interest depends at the 'prime charges'. For instance, the 'APR' (Annual Percentage Rate) on a credit card is 10% plus top price, and if the top rate is three%, the modern 'APR' on that credit score card might be thirteen%.

Reserve Bank of India (RBI) Interview Questions
Question 33. What Is The Difference Between Bank Guarantee And Letter Of Credit?

Answer :

There isn't always a lot distinction between bank assure and letter of credit score as they both take the legal responsibility of price. A bank guarantee contains greater risk for a financial institution than a letter of credit score as it's miles protective each events the consumer and supplier.

HDFC Bank Interview Questions
Question 34. What Is 'cheque Discount'?

Answer :

Cheque discounting provider is obtainable best by means of few banks. For instance, when you have a cheque of $3000 outstation and the cheque will take 7 seven days for clearance, then financial institution will provide you a provider for early payment. The bank could make an early price, but they may pay only for positive percentage of the actual amount, right here they'll pay you $2000 but they will rate hobby on it and the closing $a thousand can be paid, once the outstation cheques get clear.

Question 35. What Is Line Of Credit?

Answer :

Line of credit score is an agreement or arrangement among the financial institution and a borrower, to provide a certain amount of loans on borrower's call for. The borrower can withdraw the amount at any second of time and pay the hobby most effective on the amount withdrawn. For instance, when you have $5000 line of credit, you may withdraw the entire amount or any amount much less than $5000 (say $2000) and best pay the hobby for the quantity withdrawn (in this situation $2000).

Question 36. What Do You Mean By 'foreign Draft'?

Answer :

Foreign draft is an opportunity to foreign currency; it's miles generally used to send cash to a overseas usa. It can be purchased from the commercial banks, and they'll rate according to their banks rules and norms. People opt for 'foreign draft' for sending money as this technique of sending money is cheaper and safer. It additionally allows receiver to get admission to the funds quicker than a cheque or coins transfer.

IBPS Bank PO and Clerk Interview Questions
Question 37. Do Bank Charge For 'overdraft Protection' Service?

Answer :

Yes, bank will rate on 'overdraft protection' offerings but the costs will be applicable best whilst you start the use of the provider.

Question 38. What Are The Different Types Of Loans Offered By Commercial Banks?

Answer :

Start-Up Loans: This kind of Loan is offered to borrower to start their business and can be used to construct a storefront, to gather inventory or pay franchise prices to get a enterprise rolling.

Line of Credit: Lines of credit score are any other sort of enterprise mortgage provided through commercial banks. It is greater like a safety in your enterprise; the financial institution permits the purchaser to withdraw the quantity from quite simply to be had budget in an negative time. Customer or Company pays lower back over the years and withdraw money again without going into the loan procedure.

Small Business Administration Loans: It is a Federal Agency (U.S) that offers investment to small corporations and entrepreneurs. SBA (Small Business Administration) loans are made thru banks, credit unions and other lenders who companions with SBA.

Question 39. What Is 'availability Float'?

Answer :

Availability Float is a time distinction between deposits made, and the finances are clearly to be had in the account. It is time to technique a physical cheque into your account.

For example, you've got $20,000 already in your account and a cheque of any other $10,000 greenback is deposited for your account however your account will display stability of $20,000 in preference to $30,000 until your $10,000 greenback cheque is cleared this processing time is known as availability waft.

Question forty. What Is Iloc (irrevocable Letter Of Credit)?

Answer :

It is a letter of credit or a contractual settlement between monetary institute (Bank) and the celebration to which the letter is passed. The ILOC letter can not be cancelled under any circumstance and, ensures the fee to the celebration. It calls for the financial institution to pay towards the drafts meeting all of the phrases of ILOC. It is legitimate upto the stated period of time. For example, if a small commercial enterprise desired to settlement with an distant places dealer for a special object they might come to an agreement at the terms of the sale like exceptional standards and pricing, and ask their respective banks to open a letter of credit score for the transaction. The customer's financial institution could forward the letter of credit score to the seller's financial institution, where the price terms could be finalized and the shipment would be made.

Syndicate Bank Interview Questions
Question forty one. What Is The Difference Between 'cheque' And 'demand Draft'?

Answer :

Both are used for the switch of the quantity between two money owed of same banks or exclusive financial institution. 'Cheque' is issued by way of an character who holds the account in a financial institution, while 'Demand draft' is issued by means of the financial institution on request, and will rate you for the carrier. Also, call for draft can't be cancelled, even as cheques can be cancelled once issued.

Question forty two. What Are The Things That You Have To Keep In Concern Before Opening The Bank Accounts?

Answer :

Before commencing a financial institution account, if it's far a saving account, you have got to check the interest charge at the deposit and whether the interest fee stays constant for the period. If you've got the bank account, then search for how many cheques are free to apply. Some banks may additionally price you for the use of paper cheques or ordering new cheque books. Also, check for extraordinary debit card option this is supplied on starting an account and on-line banking capabilities.

Investment Banking Interview Questions
Question 43. What Is Cd (certificate Of Deposits) Account?

Answer :

In such account you need to deposit your cash for the fixed time period (five-7 years), and you will earn the hobby on it. The price of hobby is decided by using the bank, and also you cannot withdraw the finances till the fixed length expires.

Question 44. What Are The Different Types Of Loans Offered By Banks?

Answer :

The one of a kind varieties of loans provided by using banks are:

Unsecured Personal Loan
Secured Personal Loan
Auto Loans
Mortgage Loans
Small commercial enterprise Loans
Question forty five. How Bank Earns Profit?

Answer :

The financial institution earns income in various methods

Banking fee chain
Accepting deposit
Providing price range to borrowers on interest
Interest unfold
Additional costs on services like checking account preservation, on-line invoice charge, ATM transaction
Question 46. What Are The Different Ways You Can Operate Your Accounts?

Answer :

You can function your bank debts in extraordinary ways like

Internet banking
Telephone or Mobile banking
Branch or Over the counter provider
ATM ( Automated Teller Machine)
Question forty seven. What Are The Types Of Commercial Banks?

Answer :

Retail or purchaser banking: It is a small to mid-sized department that at once deals with purchaser's transaction instead of company or different banks
Corporate or commercial enterprise banking: Corporate banking offers with cash management, underwriting, financing and issuing of shares and bonds
Securities and Investment banking: Investment banking manages portfolios of economic property, commodity and currency, constant earnings, corporate finance, company advisory services for mergers and acquisitions, debt and equity writing and so on.
Non-traditional alternatives: There are many non-financial institution entities that provide economic services like that of the bank. The entities consist of credit card groups, credit card document businesses and credit score card issuers
Question 48. What Are The Types Of Accounts In Banks?

Answer :

Checking Account: You can get entry to the account because the saving account but, unlike saving account, you cannot earn interest in this account. The gain of this account is that there's no restriction for withdrawal.
Saving Account: You can store your money in such account and additionally earn interest on it. The wide variety of withdrawal is limited and want to hold the minimal amount of balance inside the account to remain energetic.
Money Market Account: This account gives advantages of each saving and checking debts. You can withdraw the amount and yet you could earn better hobby on it. This account may be opened with a minimal stability.
CD (Certificate of Deposits) Account: In such account you need to deposit your cash for the fixed time period (five-7 years), and you will earn the hobby on it. The fee of interest is determined by way of the bank, and also you can't withdraw the budget until the constant period expires.