FRECI_13-3 - Lecture Preview Florida Real Estate Commission...

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1 Florida Real Estate Commission Course I Pre-Licensing Course for Sales Associates Session 13 – Lecture 3 Types of Mortgages and Sources of Financing Copyright, 2005 2 Lecture Preview What will you learn from this lecture? Discuss an adjustable rate mortgage Identify the components of an ARM Identify some of the factors influencing interest rates Copyright, 2005 3 Vocabulary Terms Adjustable rate mortgage Disintermediation Index Intermediation Lifetime cap Margin Negative amortization Payment cap Periodic cap Teaser rate Copyright, 2005 4 Types of Mortgages Fully Amortized Partially Amortized Adjustable Rate Biweekly Package Home Equity Purchase Money Mortgage Reverse Annuity Copyright, 2005 5 Adjustable Rate Mortgage (ARM) Common alternative to fixed-rate loans Payments adjust periodically Rate tied to an economic index that fluctuates Lower initial rate than fixed-rate loans Negative amortization may occur!
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FRECI_13-3 - Lecture Preview Florida Real Estate Commission...

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