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    Finance Report 023210

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    Mortgage markets and derivatives are discussed. Mortgage markets support home lending by facilitating the flow of funds to allow continued lending. Derivatives derive their value from an underlying asset and are contracts between parties. Capital markets usually involve businesses and governments as borrowers, while mortgage markets involve individual borrowers. Mortgage loans are used to finance real estate purchases for both individuals and businesses and are secured by the property.

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    Finance Report 023210

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    tirol.d.cj
    6 views11 pages
    Mortgage markets and derivatives are discussed. Mortgage markets support home lending by facilitating the flow of funds to allow continued lending. Derivatives derive their value from an underlying asset and are contracts between parties. Capital markets usually involve businesses and governments as borrowers, while mortgage markets involve individual borrowers. Mortgage loans are used to finance real estate purchases for both individuals and businesses and are secured by the property.

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    Mortgage markets and derivatives are discussed. Mortgage markets support home lending by facilitating the flow of funds to allow continued lending. Derivatives derive their value from an underlying asset and are contracts between parties. Capital markets usually involve businesses and governments as borrowers, while mortgage markets involve individual borrowers. Mortgage loans are used to finance real estate purchases for both individuals and businesses and are secured by the property.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    6 views11 pages

    Finance Report 023210

    Uploaded by

    tirol.d.cj
    Mortgage markets and derivatives are discussed. Mortgage markets support home lending by facilitating the flow of funds to allow continued lending. Derivatives derive their value from an underlying asset and are contracts between parties. Capital markets usually involve businesses and governments as borrowers, while mortgage markets involve individual borrowers. Mortgage loans are used to finance real estate purchases for both individuals and businesses and are secured by the property.

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    Chapter 10

    MORTGAGE MARKETS
    AND DERIVATIVES
    by: Evangeline T. Zomil
    Mortgage Market
    is the underlying structure that supports home lending through
    mechanisms that help with free flow of funds so that lending can
    continue.

    more secured than loans are provided


    capital markets against mortgages by the
    lenders
    Derivatives
    are financial contracts, set between two or more
    parties that derive their value from an underlying
    asset, group of asset or benchmark.
    Capital Market Mortgage Market

    Usual borrowers are Usual borrowers are


    businesses and individuals.
    government entities.
    Made for changing amounts
    Has an exchange rules of maturities, depending on
    govern trading to ensure the borrowers’ needs, that
    the efficient and legal causes problems for
    operation of the exchange developing a secondary
    and also to result in a market.
    competitive trading.
    Mortgages
    are long-term loan secured by real estate. Both
    individuals and business obtain mortgages
    loans to finance real estate purchases.
    Mortgage Loans
    are used to buy a home or to borrow money
    against the value of a home you already own.
    Residential
    Mortgage
    - is a financial agreement between a
    borrower and a lender. The lender
    agrees to loan the borrower an
    agreed amount of money so that they
    can purchase a residential property to
    live in.
    The modern lender has continued to refine the long term
    loan to make it more desirable to borrowers.

    One of the biggest changes is the development of an


    active secondary market for mortgage contracts.

    Mortgage markets has become very competitive in


    recent years.

    Many loan productions offices that compete in real state


    financing.
    Characteristics
    a. Mortage Interest Rates
    of the
    b. Loan Terms
    Residential c. Collateral
    Mortgage d. Down Payment

    e. Private Mortgage Insurance

    f. Borrower Qualification
    Mortgage
    one of the most important factors in
    Interest the decision of the borrower of how
    much and from whom to borrow.
    Rates
    Three important factors that affect the interest rate on
    the loan :

    2. Term or Life of the


    1. Current long-term market rates
    Mortgage

    3. Number of Discount Points


    Paid
    Thank You!!!
    Have a Good Day

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