Recourses of foreclosure - borrower can come back through
- equity of redemption
-statutory
The possibility that the actual outcome will vary from what was expected when the asset was purchased.
- Risk
fixed amount of money paid or received at the end of every period - Ordinary annuity
future...
REAL 4000 UGA
Recourses of foreclosure - borrower can come back through
- equity of redemption
-statutory
The possibility that the actual outcome will vary from what was expected when the asset was purchased.
- Risk
fixed amount of money paid or received at the end of every period - Ordinary annuity
future cash inflow or outflow occurring only once - lump sum payment
What are the four time Value of money operations - Compounding Operations
1. Future value of a lump sum
2. Future value of an annuity
Discounting Operation
1. Present value of a lump sum
2.Present value of an annuity
What affects value - required yield
What is the highest degree of control you can have - Purchase price
loans for which the interest rate does not change over the life of the loan - Fixed rate
more common when rates in the market are not stable as they protect lender from interest rate risk -
adjustable rate
, Why would you take an adjustable rate? - it allows the borrower to secure lower rates for the
short term
Two elements of a mortgage loan - 1. The note
2. The mortgage
exact terms of financial obligation
1. Where financial terms are discussed
2. Interest rate
3.Fixed rate
4.Amortization - The Note
A pledge of property as a security for the note. Formal conveyance of rights to disposition - The
mortgage (DOT)
Various arrangements for fixed-rate loan - 1. Fully Amortized
2. Partially Amortized
3. Interest only
4. Negative Amortization
Fully amortized - Most Residential Consumer Real Estate Loans
Partially amortized - 1. Most commercial Real Estate loans
2. Term for amortization
3. Term to maturity (paid off before amortization term)
Interest only (NON AMORTIZING sometimes called a bullet loan) - 1. balloon payment at tend
UNLESS converting to amort loan
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