Chapter 9 notes Mortgage markets exist to help individuals‚ businesses‚ and other economic units to finance the purchase of a home or other property. Characteristics of mortgage markets: 1. Mortgage loans are always secured by the pledge of real property—land or buildings— as collateral. 2. Second‚ mortgage loans are made for varying amounts and maturities depending on the borrower’s needs. 3. Issuers (borrowers) of mortgage loans are typically small‚ relatively unknown financial entities. 4. Secondary
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dealing with accepting deposits and lending loans to the large corporation or retail customers. Categorization of commercial banks: [pic] Functions of Commercial Banks The functions of commercial banks are divided into two categories: I) Primary functions‚ and ii) Secondary functions including agency functions. I) Primary functions: The primary functions of a commercial bank include: a) Accepting deposits; and b) Granting loans and advances; a) Accepting deposits The
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CNBC HOUSE OF CARDS VIDEOS * Moodies‚ S&P‚ and Fitch are the three rating agencies * Stickmen securitization CHAPTER 1 – EASY MONEY OR MORTGAGE MARKET ON FIRE Who the players are? Stakeholders? Technical and ethical issues are? What was the relationship about prices and personal incomes? People started to buy houses that they couldn’t afford and then they were left behind leaving. The economy is falling and so are the communities. Insects‚ graffiti‚ dirty pools are left
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Though it is a private bank its maintenance cost is higher then any other Government bank. 7. Pressure for loan: Most of the time parties are creating some sort of pressure to get the loan. 8. Mortgage problem: There are some mortgage problem such as‚ acquisition & proprietorship‚ problem of asset. 9. Security against loan: In case of method of granting security against loan‚ hypothecation is much risky as compared with other charging security‚ but it is being used massively in
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of this paper. Fannie Mae (FNM) was created in 1938 as a mortgage association and in 1968 it became a Government Sponsored Enterprise (GSE). Freddie Mac (FM) also known as the federal home loan mortgage association was created as a GSE. Both organizations were in the business for buying mortgages from banks and turning them into mortgage backed securities. The differences of the two GSE’s are that FNM would tend to purchase mortgages from commercial banks while FM would buy from thrift banks
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caused it? Mortgage brokers‚ acting only as middle men‚ determined who got loans‚ then passed on the responsibility for those loans on to others in the form of mortgage backed assets (after taking a fee for themselves originating the loan). Exotic and risky mortgages became commonplace and the brokers who approved these loans absolved themselves of responsibility by packaging these bad mortgages with other mortgages and reselling them as “investments.” Thousands of people took out loans larger than
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prosecutors slapped Bank of America with a $1 billion-plus civil mortgage fraud lawsuit accusing the bank of engineering a scheme that defrauded federally-backed mortgage buyers Fannie Mae and Freddie Mac during the national financial crisis. What is Bank of America accused of exactly? The government says Countrywide Financial‚ a mortgage lender purchased by Bank of America in 2008‚ originated a loan program called the "Hustle" to process mortgage applications at high speed with little checking for fraud
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10: (Topic 10) Medium- to long-term debt Question 1: Manufacturer Limited is seeking a five-year term loan from its bank. The bank manager has indicated that a loan can be provided and will be priced at the bank’s base rate‚ plus a margin. Which of the following is not a determinant of the margin to be paid by the company? A: the debt to equity ratio of the borrower B: the borrower’s past loan-repayment performance C*: the term structure of interest rates D: the assets available to be pledged
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is natural‚ renewable and recyclable. The logging and manufacturing processes conform to the environmental regulations of the country of origin. Contents page Introduction 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. Money – the basics Banks – the basics Operating an account Credit and debit cards Internet banking Mortgages The housing market The consumer credit boom Pensions and other financial products Insurance Wills and other
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The mortgage crisis in 2007 caused the financial system in the United States to become down. The issue began when people started defaulting on their loans. When people started defaulting this caused lenders to toughen their credit criteria for people requesting loans. The mortgage companies had to make the criteria tougher because they were not receiving funds from households. Due to them not receiving funds‚ the interest rates for mortgages rose; this allowed the mortgage companies to still receive
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