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Real Estate Financing Essentials: Your Guide to Mortgage Markets

Explore primary and secondary loan sources, financial intermediaries, usury laws, and other financing conditions in the real estate industry. Get insights on mortgage delivery systems, Fannie Mae, Freddie Mac, and more. Discover key terms for successful property financing.

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Real Estate Financing Essentials: Your Guide to Mortgage Markets

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  1. Real Estate PrinciplesTenthEdition Real Estate: An Introduction to the Profession Tenth Edition

  2. Chapter 13Sources of Financing ____________________________

  3. Financing • Primary Market – where lenders originate loans. • Secondary Market – provides a way for lenders to sell a loan.

  4. Primary Loan Sources • Savings and Loan Associations • Commercial Banks • Life Insurance Companies • Mortgage Companies • Mortgage Brokers • Computerized Loan Origination (CLO) • Municipal Bonds

  5. Secondary Loan Sources • FNMA • GNMA • FHLMC • Farmer Mac

  6. Financial Intermediaries Mortgage Lenders The Secondary Mortgage Market Primary Market Secondary Market Mortgage Investors Borrowers

  7. Mortgage Loan Delivery Systems

  8. Usury • State legislation that imposes an interest rate ceiling on loans. • U.S. Congress passed legislation that exempts from state usury limits most first lien home loans made by institutional lenders.

  9. Other Financing Conditions • Due-on-Sale – call clause. • Prepayment - penalty for the right to repay a loan early.

  10. Alienation clause Automated underwriting system Computerized loan origination Disintermediation Fannie Mac Freddie Mac Mortgage broker Mortgage company Participation certificates Primary market Secondary market Usury Key Terms

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