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FRECI_13-4 - 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 4 Types of Mortgages and Sources of Financing Copyright, 2005 2 Lecture Preview What will you learn from this lecture? Continue discussion on different mortgage types Copyright, 2005 3 Vocabulary Terms Biweekly mortgage Home equity mortgage Package mortgage Purchase money mortgage Reverse annuity mortgage Copyright, 2005 4 Types of Mortgages Fully Amortized Partially Amortized Adjustable Rate Biweekly Package Home Equity Purchase Money Mortgage Reverse Annuity Copyright, 2005 5 Biweekly Mortgage Requires monthly payments every other week (normal monthly payment ÷ 2) 26 payments per year Results in one full extra payment per year Loan pays off about 7 years early! Copyright, 2005 6 $100,000 loan @ 8%, 30 year amortization Payment: $734 $367 $90,538 $95,070 $87,725 5 Years: 10 Years: $60,478 20 Years: $48,321 22¾ Years: $76,430 $24,040 $462 Loan balance
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