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60 Cards in this Set
- Front
- Back
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FHA |
Federal Housing Administration |
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What does the FHA not do? What does FHA do? |
Don’t build homes or lend $ themselves. Do INSURE LOANS |
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FHA does what, overseen by who, licensee should do what if buyer wants FHA loan? |
1) insured loans on real property made by qualified/approved lending institutions. 2) overseen by HUD 3) licensee should send buyer to qualified lender. |
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HUD |
Department of Housing and Urban Development |
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Requirements to receive a FHA loan: 2 |
1) borrower charged one-time |
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Requirements for getting FHA loan: 2 |
1) buyer charged one-time insurance premium. Paid at closing. 2) lender can charge points. And either buyer or seller can pay for points. |
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VA |
Veterans Administration |
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VA loan does what? |
Guarantees that a loan made by approved lending institution will be payed. |
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VA loan requirement |
Served 181 days active duty |
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VA basic entitlement |
$104,250 in counties where loan limit is $417,000 |
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If veteran does not pay mortgage = ? |
Foreclosure |
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Certificate of reasonable value |
House must qualify with an appraisal and the amount of the loan is limited. |
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Who can buy points in a VA loan? |
Buyer or seller |
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VA loans don’t allow what? |
Prepayment penalties |
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Who can get FHA loans? |
Anyone with qualified income |
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What is not allowed in FHA loans? |
No prepayment penalty |
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Does VA make direct loans? |
Not usually, only in areas without lenders. |
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Calvet |
California Veterans Farm |
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Where does loan come from in Calvet? |
Directly from State to Veteran. |
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Qualifying requirements for Calvet: 3 |
1) 90 days minimum active duty 2) honorable discharge or Statement of Service 3) buy California residence or FARM |
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Where does Calvet get funds? |
Sale of State Veteran Bonds |
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Priority of Calvet |
1- disabled war veteran 2- wartime veterans 3- peacetime veterans |
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What does Calvet use as a financing instrument? |
Contract of Sale |
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RECD |
The Rural Economic and Community Development |
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What does the RECD do? |
In rural areas and small communities outside metropolitan areas Makes loans for home purchases or construction |
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Qualifying the property |
Type of property. Economic life. Location. Condition. Area Zoning. Special clearance. Neighborhood. Overall marketability. |
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Qualifying the title |
Abstract and opinion Chain of title Title insurance and other terms |
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Non-recourse loan |
The borrower is not held personally liable on the note. |
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Non-recourse Clause |
A condition in a loan, says borrower not personally liable beyond the collateral pledge for the loan. |
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Default |
Non-performance of a duty or obligation that is part of a contract. |
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Conditional approval Aka |
Aka conditional or qualified commitment Written pledge by a lender to lend a certain amount of $ to a qualified buyer, on particular property, specified time, specific terms. |
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Underwriting |
The analysis of risk assumed with connection to a loan. |
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Appraisal fees |
Usually based on time and expenses NEVER based on a percentage of appraised value. |
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Estoppel Certificate |
A person is prevented from asserting rights or fact that are inconsistent with previous position or representation made by act, conduct, or silence. |
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Exculpatory clause |
Lender waives right to a deficiency judgement |
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Impounds |
A fund of the buyer’s $ that is set aside for future needs relating to the parcel of property. |
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Disintermediation |
Investing $ directly instead of putting into savings institutions. |
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5 loan sources |
1) savings and loans 2) banks 3) Insurance companies 4) Mortgage Broker 5) Mutual Savings bank |
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Savings and Loans loan |
Specialized in long-term residential loans. Deposit must be insured up to $250,000. |
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Bank loan |
Make short-term loans |
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Insurance company loan |
Prefer larger commercial projects, BUT will make residential loans. Participation Financing |
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Insurance company loan |
Prefer larger commercial projects, BUT will make residential loans. Participation Financing |
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Participation Financing |
Mortgage in which lender participates in the income of the mortgaged property beyond a fixed return, or receives a yield on the loan in addition to straight interest rate. |
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Mortgage Broker loan |
Provides own funds for loans or negotiates loans for compensation. |
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Mutual Savings Bank loan |
Are also lenders in the primary market. More Eastern States. |
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The Federal Reserve System |
Central banking system designed to manage nation’s economy. |
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Reserves |
Amounts of $ banks are required to keep on hand. |
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Discount Rates |
Rate in which federal reserve charges banks for $ |
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Buying bonds |
More $ in market = decrease interest rates = stimulated economy. |
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Selling bonds |
Less $ in market = increase interest rates = slowed economy. |
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Secondary Mortgage Broker |
Provides funds for the primary market(lenders). |
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3 Secondary Mortgage Markets |
1) Fannie Mae, Federal National Mortgage Association FNMA 2) Ginnie Mae, Government National Mortgage Association GNMA 3) Freddie Mac, Federal Home Loan Mortgage Corporation. FHLMC |
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3 Secondary Mortgage Markets |
1) Fannie Mae, Federal National Mortgage Association FNMA 2) Ginnie Mae, Government National Mortgage Association GNMA 3) Freddie Mac, Federal Home Loan Mortgage Corporation. FHLMC |
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Who regulates Fannie Mae, Ginnie Mae and Freddie Mac? |
HUD |
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3 Secondary Mortgage Markets |
1) Fannie Mae, Federal National Mortgage Association FNMA 2) Ginnie Mae, Government National Mortgage Association GNMA 3) Freddie Mac, Federal Home Loan Mortgage Corporation. FHLMC |
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Who regulates Fannie Mae, Ginnie Mae and Freddie Mac? |
HUD |
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Property increases in value due to what? 2 |
1) inflation 2) increase in intrinsic value of the property |
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What is required to sell FNMA, GNMA, FHLMC shares (securities) |
Securities license |
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In the California mortgage market, who are traditional loan sources? |
Savings and Loans (Depository institution) |
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3 types of lenders |
1) institutional 2) Non-institutional 3) Government- Backed programs |
