© 2008 by south-western, cengage learning chapter 14 chapter 14 charles j. jacobus thomas e....
TRANSCRIPT
© 2008 by South-Western, Cengage Learning
Georgia Real Estate Georgia Real Estate An Introduction to the ProfessionAn Introduction to the Profession
Seventh EditionSeventh Edition
Chapter 14Chapter 14
Types of FinancingTypes of Financing
© 2008 by South-Western, Cengage Learning
Adjustable Rate MortgageAdjustable Rate Mortgage
Interest rateTied to an indexReflects current market conditions
MarginAmount added to
the index
Adjustment Period
© 2008 by South-Western, Cengage Learning
Adjustable Rate MortgageAdjustable Rate Mortgage
CapsInterest rate
Payment
Negative
AmortizationRising loan balance
© 2008 by South-Western, Cengage Learning
Adjustable Rate MortgageAdjustable Rate Mortgage
Disclosures
Regulation ZHistorical Examples
“The Consumers Handbook on Adjustable Rate and Mortgages”
Maximum rate
Choosing WiselyTeaser rate
© 2008 by South-Western, Cengage Learning
Types of FinancingTypes of Financing
Equity SharingSAM: Shared appreciation mortgage
Rich Uncle
Package MortgageReal & personal property
© 2008 by South-Western, Cengage Learning
Types of FinancingTypes of Financing
Blanket MortgageSecured by more than one property
Reverse Annuity Mortgage (RAM)
Monthly payment to homeowner
Repayment upon sale or death
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Types of FinancingTypes of Financing
Construction Loan
Construction LoanConstruction Loan Interim LoanInterim Loan
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Types of FinancingTypes of Financing
Blended Rate LoanCombines existing rate with current rate
Equity MortgageLine of credit against
equity in the home
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Affordable Housing LoansAffordable Housing Loans
Target first time homebuyersCredit criteria
Consumer education
97% Conventional
Nehemiah Program
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Conventional Mortgage vs. AIMConventional Mortgage vs. AIM
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Seller FinancingSeller Financing
Purchase Money MortgageSeller becomes the LenderPromissory note & security instrument.
Wraparound MortgageJunior MortgageNew mortgage wraps round the existing mortgage
© 2008 by South-Western, Cengage Learning
FinancingFinancing
SubordinationChange in priority
Contract for DeedInstallment or land contract
Buyer makes payments to the Seller
Seller retains title until final payment
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FinancingFinancing
Option
Overly Creative Financing
Over-encumbered property
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Mortgage FraudMortgage Fraud
Illegal Flipping
Silent Second
Chunking
Identity Theft
Debt Cancellation / Deed Transfer
Red Flags
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Mortgage FraudMortgage Fraud
Reporting Mortgage Fraudwww.grefpac.org
www.gscca.org
www.mortgagefruadblog.org
www.ustaxcourt.gov
www.usgovsearch.com
www.stopmortgagefraud.com
www.mbaa.org/alerts
© 2008 by South-Western, Cengage Learning
FinancingFinancing
Investing in MortgagesInvesting in MortgagesMortgage loan poolsJunior mortgages
RentalSale and leaseback
Land LeasesStep-up leases