CHP 16 - Real Estate Finance II Flashcards
Redlining
Lender requires higher down payment based on neighborhood of home
Loan Flipping
Refinancing charging borrowers points and fees
3 Types of Mortgage Backed Securities
- Straight pass-through
- Modified Pass through
- Fully modified pass thru
Regulation Z
truth in lending
Subprime Loan
High interest and fees - for those who can’t qualify for conventional
Ginnie Mae I MBS
Single family pools, most traded product
pymnts made on 15th
Minimum pool size $1 million
Ginnie Mae II MBS
Modified pass through MBS - minimum pool $1 million for SF
$350K for manufactured homes
$500K for all other pool types
Fannie Mae Guidelines
- Loan Limits
- Debt-to-Income Ratio less than 28%
- Any LTV more than 80% must have PMI
- 20% down payment
Max conforming mortgage limit for SF as of 2018
$453,100
Max Conforming Loan amt for 2 unit as of 2018
$580,150
Max Conforming Limit 3 Unit
$701,250
Fannie Mae Loan Limit 4 Family
$801,950
A loan exceeding the conforming loan limits
Jumbo Loan
Fannie Mae
Shareholder-owned Increase flow of mortgage money by creating secondary mkt
Purpose of Freddie mac
1971 - MBS for conventional loans
Mission of Freddie Mac
Provide stability, affordability and opportunity for minorities
Basic Purpose of Truth In Lending - implemented by Regulation Z
Give buyers info about true cost of obtaining credit
Right to Rescind
Borrower has right to cancel within 3 days - does not apply to residential first mortgageloans
Home price $150K
Down pymnt $15K
Loan for balance
What is the LTV (loan to value) ratio
90%
Loan Flipping
Encouraging borrower to refinance so lender can charge high points and fees on new loan
Minimum Down Payment required for conventional as o 2018
3%
Which loans require PMI at certain higher LTV amounts
Conforming Residential Loans