GENREAL MORTGAGE KNOWLEDGE Flashcards
- The Federal National Mortgage Association (FNMA) is known as Fannie Mae.
Fannie Mae is the largest institutional buyer of conventional mortgages in the secondary mortgage market.
- The Secondary Market includes private investors or government agencies that
buy or sell real estate mortgages.
- The Federal Home Loan Mortgage Corporation (Freddie Mac) was chartered by the federal government to buy mortgages originated by Savings Associations.
- The Government National Mortgage Association (Ginnie Mae) is a wholly owned government corporation within the United States Department of Housing and Urban Development (HUD).
- Ginnie Mae does not
buy or sell loans or issue mortgage-backed securities (MBS).
- Ginnie Mae guarantees investors the timely payment of principal and interest on MBS backed by federally insured or guaranteed loans — mainly loans insured by the Federal Housing Administration (FHA) or guaranteed by the Department of Veteran Affairs (DVA).
- Fannie Mae’s automated underwriting system is known as
Desktop Underwriter(DU).
- Freddie Mac’s automated underwriting system is known as
Freddie Mac’s LoanProduct Advisor
- The 2020 maximum conforming loan limit was raised to is $970,800 for 2022.
- Fannie Mae requires only a seven-year history to be reviewed for
all credit and public record information.
- A conventional mortgage requires a
minimum 3% down payment for first-time homebuyers.
- Generally, the minimum 5% down payment.
( This is how it is written in the facts (?) )
- A conventional mortgage is
not insured or guaranteed by the government.
- A conventional mortgage requires Private Mortgage Insurance on loans with less than
a 20% down payment.
(Private Mortgage Insurance - policy that allows lenders to recover part of loss in the event of borrower default or loss in collateral value.)
- Most conventional mortgages are not assumable;
they do have a “due-on-sale clause”.
- A conventional mortgage has a __% late fee
5% (5% of the P&I amount only).
P is Principal, I is Interest
- GOVERMENT LOANS (FHA, DVA, USDA) have a _% late fee
4% (4% of the P&I amount only).
- The down payment amount on a conventional conforming loan could vary – however, on a conventional loan
5% of the down payment amount must come from the borrower’s own funds
- FHA insured loan require how much down payment?
3.5% down payment (can be a gift).
- DVA and USDA guaranteed loans
do NOT require a payment.
- A jumbo loan exceeds Fannie Mae /Freddie Mac
maximum loan amount (aka non-confirming loans).
- P&I (Debt Service) is
the monthly principal and interest payment
- Late fees are either _% or _% of the debt service, not the PITI.
4% or 5%
- Escrow impounds are
usually collected by the lender as part of the monthly mortgage payment. They include the monthly amount for property taxes, hazard insurance and flood insurance, if required.