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Flashcards in Financing Deck (28):
0

Origination fee

Origination fee is the loan fee or sometimes is referred to as the discount fee

1

Veterans Administration

The VA will guarantee 60% of a loan amount not to exceed a total guarantee of $36,000

2

Three day right recession

The three-day right of recession only applies when A lien can be placed on a persons home that he already owns.

3

Junior mortgage

The Junior mortgage is secondary financing

4

The function of the Federal housing administration FHA is to

Insure loans

5

Mortgage brokers

Mortgage broker does not issue loans but they locate borrowers and lenders as an intermediary. They do charge a loan fee.
Locate borrowers , find lenders, and process applications.

6

Mortgage bankers

Mortgage bankers are in the business ofl originating, selling, and servicing loans

7

Subject to mortgage

A buyer purchasing property with a subject to mortgage is not liable for any deficiencies. Would be most beneficial to a buyer

8

Hypothecation

Is when a lender allows a borrow to possess pledged real estate for use

9

Federal housing administration FHA

The FHA lends money to qualified individuals

10

FHA

The FHA does not lend any money. The FHA administers an insurance program that allows home buyers to borrow almost the full purchase price with a low down payment. (insures loans)

11

Wrap around mortgage

A wraparound mortgage incorporates existing mortgages and becomes subordinate to them

12

Truth in lending law

The truth and lending law requires disclosure to mortgage applicants
(To inform mortgage applicants of the cost of obtaining the loan)

13

Closing attorney

The closing attorney is responsible for prorating the expenses between the parties

14

Fannie Mae

Fannie Mae does not lend money its part of the secondary mortgage market

15

Regulation Z

Regulation Z of the truth in lending law requires that a meaningful disclosure must be given to the borrower regarding the cost of obtaining credit

16

A purchase money mortgage

In a purchase money mortgage, the seller finances the sale of the property by lending the money to the buyer

17

Origination fees

The origination fee is the loan fee or sometimes is referred to as the discount fee

18

Discount rate

The federal discount rate has the greatest effect on persons interest rate. Federal Reserve Board will adjust its rate to encourage or discourage member banks to increase the supply of money

19

Three main types of mortgages

Conventional, private backed mortgages, and government-backed mortgages such as FHA VA, etc.

20

A commitment letter

A letter of commitment for a loan is issued by a lender after a review of the credit report of the borrower and an analysis of real estate asset. The letter contains the amount of the loan, the loan interest rate, and repayment options

21

Mortgagee

Is the lender

22

Deferred purchase money mortgage

A property sold with a second mortgage taken by the owner is a deferred purchase money mortgage. Sometimes the interest do is paid monthly or deferred as well

23

An assumption mortgage

This is because the buyer agrees to assume and make himself personally responsible for payment

24

The Defeasance clause

Defeasance clause are used in a mortgage that states that the lender will return title to the borrower once the depth or loan has been paid in full

25

Purchase money mortgage

In a purchase money mortgage, the seller finances the sale of the property by lending the money to the buyer

26

MGL 140C

Massachusetts as it's own truth in lending law (TIL) known as MGL CH 140 C

27

RESPA

Stands for real estate settlement procedures act that requires all settlement charges be itemized to buyers and sellers of 1 to 4 unit family residence and was passed in 1974