1. ©OnCourse Learning. All Rights Reserved.

2. Types of Financing ©OnCourse Learning. All Rights Reserved. Chapter 18

3. ©OnCourse Learning. All Rights Reserved. In This Chapter You will look at the almost endless array of mortgage rates and accompanying fees used in today’s finance market.

4. Adjustable Rate Mortgage Interest rate Margin Adjustment period Interest rate cap Payment cap Negative amortization Disclosures ©OnCourse Learning. All Rights Reserved. What to look for?

5. Other Financing Methods Graduated Payment Mortgage Equity Sharing “Rich Uncle” Financing Package Mortgage Blanket Mortgage ©OnCourse Learning. All Rights Reserved.

6. More Financing Methods Reverse Mortgage Construction Loan / Interim Loan Blended-Rate Loan Equity Mortgage ©OnCourse Learning. All Rights Reserved.

7. Affordable Housing Loans Underwriting standards are modified to recognize different forms of credit responsibility. Consumer education. Low down payment. ©OnCourse Learning. All Rights Reserved.

8. More Financing Methods Conventional Loan (97%) The Nehemiah Program ©OnCourse Learning. All Rights Reserved.

9. Seller Financing The current owner of the property agrees to accept part of the purchase price in the form of a loan (promissory note and mortgage or deed of trust) also becoming the lender in the transaction. ©OnCourse Learning. All Rights Reserved.

10. Wraparound Mortgage BuyerSeller $20,000 Debt $60,000 Debt 1 st Lender (Includes wrapped $20,000) ©OnCourse Learning. All Rights Reserved.

11. Financing Techniques Subordination Contract for Deed Option Creative Financing Rental Land Leases ©OnCourse Learning. All Rights Reserved.

12. Investing in Mortgages Individuals can invest in mortgages Individuals can purchase junior mortgages Higher yields available Risk as to repayment & difficult to convert to cash before maturity ©OnCourse Learning. All Rights Reserved.

13. Key Terms ARM Affordable Housing Loan Blanket mortgage Construction loan Equity sharing GPM Negative amortization Option Package mortgage Reverse mortgage Seller Financing Wraparound mortgage ©OnCourse Learning. All Rights Reserved.