Chapter 13 Flashcards
FHA down payment requirements is to have at least
3 percent
Maximum loan amount For a single family residence in a FHA is?
$271,050
UFMIP
Up front mortgage insurance premium
AMIP
Annual mortgage insurance premium
The UFMIP mortgage amount in most case is
1.5 %
The AMIP is paid on a monthly basis and is calculated by multiplying the remaining principle balance by
0.5 percent, and divided by 12
An initial interest rate stated in the promissory note that is lower than the indexed rate. Usually for the first year of the loan
Teaser rate
Allows the lender to share in the income generated by the mortgage property
Income participation mortgage
Allows the lender to gain a share of the appreciation in value of a mortgage property
Shared appreciation mortgage
Permits the lender to share in the ownership with the borrower
Equity participation mortgage
If the reserve requirement is increased, the amount of money available for lending is decreased, which may cause interest rate to
Increase
An area experiencing growth, but lacking local funds to pay for the growth is called
Capital deficit (mutual saving bank)
An area having an excess of funds needed locally is termed a
Capital surplus (mutual saving bank)
FHA?
It does not make loans, it assures loans made by approved local lenders.
Fha down payment requirements
At least 3 percent of their own cash in the transaction.
VA guaranteed loans
Is to assist military veterans in financing the purchase of reasonably price homes. Require little down payment and low rates of interest
Down payment on VA
Does not require a down payment but if veteran does not meet lenders sufficient income then a down payment is 5 percent.
VA entitlement
Maximum is $104,250 but eligibility for getting is to have service in the military for 90 days. Veterans spouse are eligible too if the veteran got killed in action, died to injuries, or mission in action
Conventional mortgage loans
Any loan that is not insured or guaranteed by an agency of the government. Typically requires higher down payment, higher interest rate, and higher risk in foreclosure.
Private mortgage insurance (PMI) conventional
Requires this insurance when the loan amount exceeds 80 percent of the value of the property. If it’s less then 78 percent don’t need it. PMI can get you up to 95 percent loan of the value of property.
Annual plan PMI
1 percent of the loan for the first year and 0.25 of 1 percent in succeeding years
Closing cost plan PMI
2.5 percent of the loan amount at closing
Blanket mortgage
Is a single mortgage given by a borrower that pledges two or more parcels as security of the loan. Usually contains a release clause.
Wraparound mortgage
Is a new mortgage incorporated in an existing balance with an additional amount.
Includes both real and personal property as security for a loan such as refrigerator, range, dishwasher and so on
Package mortgage
Mutual saving banks
Organized to assist members in the financing of residential properties. Mutual saving banks state chartered and mutually owned by their depositors.
