Equity mortgages, also known as reverse mortgages, allow homeowners to use their home equity while still living in the property. Homeowners must meet specific qualifications and the home is held as collateral. Cash disbursements are provided to the homeowner, typically on a monthly basis, to augment retirement funds. The homeowner must be over 55 and […]
A net mortgage branch is a smaller outpost of a lending institution where loan originators work under the supervision of the parent entity, allowing them to run their business while avoiding administrative hurdles. Net branches can originate loans in multiple jurisdictions, pay a flat fee for each loan file submitted, and have access to lenders […]
Secured mortgage bonds are a separate entity used to manage debt, taking ownership of debts including mortgages. The combined mortgage pool forms the basis for investors to purchase bonds, known as tranches, with a defined set of rules. This type of finance is associated with high-priced properties and used by banks, insurance companies, hedge funds, […]
Mortgage analysis assesses the condition of a mortgage market, using a variety of information sources to identify events impacting property sales and financing. It can be used to create a snapshot of the market and project future demand, helping lenders develop new mortgage packages and reduce risk. “Mortgage analysis” is a term used to identify […]
Mortgage disability insurance provides resources to mortgage holders who become incapacitated and cannot make mortgage payments. It requires a medical authority to declare the homeowner disabled and unable to work. It helps protect the homeowner from foreclosure and is sometimes required by lenders. The coverage varies depending on the insurance contract. Mortgage disability insurance is […]
Weekly mortgage payments offer the advantage of paying off more of the mortgage balance per year, but may come with additional processing fees and difficulty managing frequent payments. Homeowners should carefully consider the costs and benefits before agreeing to a weekly payment structure. While most mortgages require you to make a one-time payment every calendar […]
Mortgage reduction agreements aim to make payments more affordable, often through lower interest rates or larger down payments. Discount points and lump sum payments can be used, but buyers must still have acceptable credit. A mortgage reduction is an agreement in which the lender and the borrower use one or more strategies to make the […]
A mortgage obligation is a legal document that gives a lender rights to a borrower’s assets if a loan is defaulted. It is often required by banks for business loans and can include physical property, unpaid bills, or the business itself as collateral. The bank may also have the right to take over all business […]
A mortgage loan officer helps people buy property by determining appropriate loans and assessing creditworthiness. They work for financial institutions and may handle other types of loans. A bachelor’s degree in finance or business is common, and pay is based on fees. They work closely with real estate agents and must have excellent people skills […]
Getting a mortgage with bad credit involves assessing financial situation, credit score, and cost of ownership. Borrowers may need to put more money down or participate in additional housing counseling. Pre-approval involves a thorough financial review and may recommend special loan programs. Final approval requires an appraisal and review of financial information. The process for […]
The secondary mortgage market involves buying and selling mortgage loans and associated fees to create mortgage-backed securities. This market injects capital into originator lenders, improves chances of mortgage approval for consumers, and provides a source of ongoing returns for investors. A secondary mortgage market is the market in which mortgage loans and associated servicing fees […]
The mortgage application process involves providing financial information, a credit report, down payment, property appraisal, and title search. The borrower should bring financial documents and the home is inspected and evaluated. The final stage is closing, where the loan agreement is signed and closing costs are paid. Providing financial information to a lender is usually […]
The Mortgage Forgiveness Debt Relief Act of 2007 temporarily suspended income tax on forgiven debt from bankruptcy or refinancing for primary residences up to $2 million. It does not cover rental or second homes, and was extended through 2012 due to the financial crisis. The Mortgage Forgiveness Debt Relief Act is a 2007 law passed […]
Islamic mortgages comply with Islamic law and eliminate interest, allowing devout Muslims to buy homes without compromising their religious values. Different approaches include murabahah, musharaka, and ijarah, and some companies’ products are scrutinized by Islamic scholars. This financing option is available worldwide. An Islamic mortgage is a home loan that complies with Islamic law, allowing […]
Mortgage protection insurance comes in different types, including private mortgage insurance for lenders, and mortgage protection plans for homeowners in case of death, disability, or job loss. Homeowners should choose the right plan based on their needs and compare rates from multiple sources. Mortgage protection insurance comes in a variety of formats. Each is designed […]
Silent second mortgages are taken out on properties with existing mortgages without the knowledge of the first mortgage holder. They are legal but can be used fraudulently. They are often used to finance down payments and can cause problems if the homeowner defaults on either mortgage. Silent second mortgages are mortgages that are taken out […]
Mortgage forfeiture is a fraudulent practice where scammers convince home buyers that their mortgage loan is invalid and should not be repaid. The scam is based on misrepresented court rulings, but most courts can spot the fraud. Scammers use various invalid legal arguments to get home buyers to submit papers that invalidate the mortgage lender’s […]
A secondary market mortgage is sold by loan originators to investors, allowing for quick and easy access to funds. Homeowners don’t notice a difference in their mortgage agreement, and government agencies like Fannie Mae and Freddie Mac offer many mortgage loans on the secondary market. This strategy offers opportunities for investors to achieve consistent returns […]
A second mortgage is an additional loan on a property that is obtained after the first mortgage. The lender considers the outstanding amount on the first mortgage, property value, and credit rating before deciding on the loan amount and interest rate. Second mortgages have higher interest rates and shorter terms than first mortgages. A second […]
Lenders must assess mortgage risk, the likelihood of non-payment or abandonment, using credit checks, income verification, home appraisals, and loan pricing. Mortgage insurers and investors also share inherent risks. Lenders taking out mortgages need to consider the danger posed by borrowers who prove unwilling or unable to make agreed mortgage payments. Financial professionals refer to […]
