Unit 1: The Primary Mortgage Market and Institutional Funding Sources
loan servicing
Collects mortgage payments, processes tax and insurance payments, and prepares records for other lenders
loan origination
Collects origination fees, discount points, and monthly interest payments from borrowers
interim
Construction loans are a type of _______ financing.
preparing tax records
How does a lender in the primary mortgage market earn money when a loan is originated?
non recourse clause
In a foreclosure or short sale, one clause in the security instrument may save a borrower from that evil deficiency judgment. What clause is it?
primary mortgage market
In which market do lenders that originate real estate loans operate?
private
Mortgage bankers are mostly ______ enterprises.
packaging and selling loans
Sells the flow of principal and interest to investors
surety
Under the SAFE Act, every mortgage loan originator must be fully licensed and carry a mortgage ______ bond.
demand deposits
What's the primary source of funds for commercial banks?
short sale
in this, the lender will report any amount forgiven on the loan to the IRS on a 1099
construction loan
local company wants to build a new office building. What type of loan will it most likely be seeking from its commercial bank?
deficiency judgment
this allows the lender to recover losses incurred in the foreclosure process.
blanket lien
this gives lenders the ability to recover losses due to a foreclosure sale from any current or future property the borrower owns.