Mortgage Basics Flashcards
A mortgage that covers and includes more than a single property is called a ____________.
Blanket
A mortgage that finances both the real property and the personal property is called a ____________ mortgage.
Package
What would you call a loan that allows you to move from one property to another? For instance, you find a house you really want to buy but your first house isn’t sold so you use this type of loan to make the jump. ____________.
Bridge, Swing, Interim
What would you call a financing situation where the buyer receives financial assistance with the down payment and closing costs, and in exchange gives up some share of the equity buildup in the property?
Shared Equity Loan
There is a type of mortgage where the monthly payment increases as your ability to pay more improves, for instance for someone who doesn’t have much income but has great income potential, for instance someone just graduating from law school or medical school. This is a ____________.
Graduated Payment Mortgage (GPM)
When money is plentiful, what happens to interest rates?
Rate Lowers
A transaction that involves the sale of property to free up the liquid assets that are trapped in the real estate and a lease of that same property is called a ______________.
Sale-Leaseback
You would call the borrower ____________.
Mortgagor
You would call the lender the ____________.
Mortgagee
In the ____________, banks sell mortgages to people. In the _____________, banks sell mortgages to other banks.
primary market, secondary market
FHA (Federal Housing Administration), VA (Veteran’s Affairs), and SONYMA (State of NY Mortgage Agency) are in the ____________.
primary market
FNMA (Federal Home Mortgage Corporation), GNMA (Government National Mortgage Corporation) and FHMC (Federal Home Mortgage Corporation) ate in the ____________. These organizations participate by buying and selling mortgages along with banks.
secondary market
What is the definition of a “wrap-around mortgage”?
Look for an answer that references an existing ‘first’ mortgage lumped together with a new ‘second’ in the form of owner financing. Also, one identifying characteristic of a wrap is that the second mortgage component is significantly larger than the first mortgage component. Normally, the first would be for a greater amount than the second, because the interest rate on a first mortgage is usually more preferable than for a second mortgage.
What is the act of charging interest that is over the legal limit?
Usury
What regulates the advertising of consumer loans, or the terms of lending?
Regulation Z
