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23 Cards in this Set
- Front
- Back
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Secondary Mortgage Market
-liquidity for lenders -purchase lenders notes & provide cash |
Fannie Mae (Federal National Mortgage Association) - largest purchaser in secondary market
Ginnie Mae - (Government National Mortgage Association) Government owned HUD buy FHA & VA
Freddie Mac (Federal Home Loan Mortgage Corp) - primarily buys conventional mortgages
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Types of Loans Conventional Mortgage |
30 years, no government backing, less than 20% down requires PMI |
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Types of Loans FHA |
Insures loans, doesn't make loans. Certified FHA appraiser, Expensive loan |
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Types of Loans VA |
100% loan to value No down payment Guaranteed loans Widow/Widower Qualify
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Discount Points - Life of the Loan |
Buy down interest rate Pay more up front Increase actual yield on bank note |
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Points - Buy Down |
Lowering interest rate for period of time, helps buyer qualify for loan, pay money up front
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Points - Loan origination fee Costs of initiating loan |
Points- Lock in Commitment Lender locks in buyer on interest rate and discount points for a period of time |
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Alternative Financing Contract for Deed, installment or land contract - seller financing |
Seller - retains Deed Buyer - signs contract obtains equitable title, legal title after final payment
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Alternative Financing Contract for Deed, installment or land contract - seller financing |
Seller - retains Deed Buyer - signs contract obtains equitable title, legal title after final payment
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Primary Mortgage Market |
Savings & Loans (residential) Commercial Banks (business) Insurance Co. (High $ loans) Mortgage Bankers (middleman) Mortgage Broker (not part of banking industry, flexibility) |
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Financing Legislation |
Usury Laws- maximum interest rate that lender can charge
Truth-in lending (regulation Z)
RESPA |
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Regulation Z - Truth in Lending |
FTC government regulation -APR -Right of Rescission -Credit Advertising -Disclosure of Loan Costs |
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Regulation Z - Truth in Lending |
FTC government regulation -APR -Right of Rescission -Credit Advertising -Disclosure of Loan Costs |
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Right of Rescission |
Does not apply to First Mortgages or residential 3 days to rescind agreement Credit installed sale or home equity loan |
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Financing - Advertising |
No Numbers No down payment is a number |
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RESPA Real Estate Settlement Procedures Act |
Inform buyers of Total Closing Costs in advance. First mortgage on 1-4 plea and less than 25 acres with a home
Required: 1. Buyers Guide HUD 2. Good Faith Estimate of Settlement Costs 3. Uniform Settlement Statement (at closing to Buyer & Seller) 4. Limits on Pre-paids (taxes & insurance) 5. No kickbacks |
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Equal Credit Opportunity Act |
Bans credit discrimination on race, color, religion, national origin, sex, age, martial status |
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Closing Settlement Procedures Who? Seller, Buyer, Closing Agent (Title Co) |
Title Validity - seller produce marketable title Conveyance - seller transfers title giving deed to buyer Closing Statement - all closing costs for seller & buyer. Biggest credit to buyer Earnest Money & Loan |
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Purchase Money Mortgage |
Seller pays closing costs, Debit (charge) - Seller; Credit ($$) - Buyer |
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Purchase Money Mortgage |
Seller pays closing costs, Debit (charge) - Seller; Credit ($$) - Buyer |
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Prorations Closing: Accured (debt built up, not paid) seller debit, buyer credit |
Prorations Closing: Pre Paid ie: insurance (Paid in advance, not used) Credit - buyer, Debit - seller |
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Closing Seller: Debit (charge) Loan payoff Accrued interest Brokers commission Pro rated taxes Transfer taxes |
Seller: Credit (Money)
Sales Price |
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Closing Buyer: Debit (charge) Sales Price Loan origination Pre-paid interest Discount points Appraisal Survey Mtg Tax Inspections Closing Fee Recording Fee Title Expenses |
Buyer Credit (money)
Earnest Money, loan, pro-rated taxes, purchase money |
