Question 1

According to your text mortgage pools or trusts account for approximately what percentage of mortgages in the U.S. market?

Accepted Answer

A)  5% 
B)  10% 
C)  25% 
D)  49 and % 
E)  55% 
A)  5% 
B)  10% 
C)  25% 
D)  49 and % 
E)  55% D

Question 2

Please identify the following federal agencies and describe their roles or functions: FHA, VA, FHLB, FNMA, GNMA and FHLMC.

Accepted Answer

FHA - The Federal Housing Administration reduces risk on home mortgages to private investors by guaranteeing qualified home loans.
VA - The Veterans Administration reduces risk to private investors on residential mortgages made to veterans or members of the armed services through partial guarantees of the principal and interest payments.
FHLB - The Federal Home Loan Bank was set up during the Great Depression to supervise S&Ls, make loans to those in trouble and refinance mortgages on 1-4 family units that were to be foreclosed.
FNMA - The Federal National Mortgage Association or Fannie Mae, provides a secondary market primarily for FHA and VA loans.
GNMA - The Government National Mortgage Association or Ginnie Mae, makes "assistance loans" and provides a means of secondary marketing of residential mortgages through its mortgage-backed securities programs.
FHLMC - The Federal Home Loan Mortgage Corporation or Freddie Mac, was set up to provide a secondary market for conventional residential mortgage loans.

Question 3

A strong housing market can provide an incentive for households to refinance their homes simply to capture some of the additional equity associated with rising home prices.

Accepted Answer

A) True 
 B)False  True

Question 4

Like the Federal housing administration (FHA) the veteran's administration (VA) offered to insure residential mortgages and helped to _____________________ required to buy a new homes.

Accepted Answer

A)  Lower both loan rates and down payments 
B)  Lower loan rates 
C)  Lower the down payment 
D)  Raise loan rates and lower down payment 
E)  None of the above 
A)  Lower both loan rates and down payments 
B)  Lower loan rates 
C)  Lower the down payment 
D)  Raise loan rates and lower down payment 
E)  None of the above

Question 5

Securities issued by Freddie Mac are not guaranteed by the federal government.

Accepted Answer

A) True 
 B)False

Question 6

What is a loan modification agreement? What is its purpose?

Accepted Answer

Loan modifications are designed to assis

Question 7

What has happened in recent years to the prices of new homes? To interest rates and other terms on conventional home mortgage loans? What are the causes of these trends?

Accepted Answer

The average purchase price of a conventi

Question 8

What is a mortgage lock-in? Does it benefit the borrower or the lender? When might it not be a good idea?

Accepted Answer

When a borrower "locks in" a mortgage lo

Question 9

Mortgage pools or trusts now account for more mortgage loans than savings and loans associations according to your text.

Accepted Answer

A) True 
 B)False

Question 10

When two home owners trade their houses with each other this is known as a:

Accepted Answer

A)  Land lease 
B)  Lease-purchase deal 
C)  Reverse mortgage 
D)  Switch loan 
E)  None of the above 
A)  Land lease 
B)  Lease-purchase deal 
C)  Reverse mortgage 
D)  Switch loan 
E)  None of the above

Question 11

Please list the principal mortgage lending institutions in the United States. Which is most important? In what particular areas of the market?

Accepted Answer

The principal mortgage lending instituti

Question 12

How has the federal government's intervention in the home mortgage market over the past several decades changed the structure and operation of the home mortgage market? For what reason has all of this been done?

Accepted Answer

Adequate housing for all citizens has be

Question 13

Residential mortgages may be classified in several different ways. Please describe the structure of the mortgage market as it relates to each of the following dimensions:

Accepted Answer

- Type of mortgage contract-conventional

Question 14

A number of new mortgage instruments have appeared in recent years. These new financial instruments include variable rate mortgages (VRMs), adjustable mortgage instruments (AMIs), Canadian rollover mortgages (CRM) and reverse-annuity mortgages in addition to the more conventional fixed-rate mortgage (FRM). Please describe how each of these home mortgage instruments works and what their advantages are.

Accepted Answer

FRMs - Fixed-rate home mortgages return

Question 15

How does the behavior of the home mortgage market reveal the problems that both home buyers and mortgage lenders face as they operate in this huge financial marketplace?

Accepted Answer

Mortgages are among the most important s

According to your text mortgage pools or trusts account for approximately what percentage of mortgages in the U.S. market?

Please identify the following federal agencies and describe their roles or functions: FHA, VA, FHLB, FNMA, GNMA and FHLMC.

A strong housing market can provide an incentive for households to refinance their homes simply to capture some of the additional equity associated with rising home prices.

Like the Federal housing administration (FHA) the veteran's administration (VA) offered to insure residential mortgages and helped to _____________________ required to buy a new homes.

Securities issued by Freddie Mac are not guaranteed by the federal government.

What is a loan modification agreement? What is its purpose?

What has happened in recent years to the prices of new homes? To interest rates and other terms on conventional home mortgage loans? What are the causes of these trends?

What is a mortgage lock-in? Does it benefit the borrower or the lender? When might it not be a good idea?

Mortgage pools or trusts now account for more mortgage loans than savings and loans associations according to your text.

When two home owners trade their houses with each other this is known as a:

Please list the principal mortgage lending institutions in the United States. Which is most important? In what particular areas of the market?

How has the federal government's intervention in the home mortgage market over the past several decades changed the structure and operation of the home mortgage market? For what reason has all of this been done?

Residential mortgages may be classified in several different ways. Please describe the structure of the mortgage market as it relates to each of the following dimensions:

How does the behavior of the home mortgage market reveal the problems that both home buyers and mortgage lenders face as they operate in this huge financial marketplace?

Functions and Roles of the Financial System in the Global Economy

Financial Assets, Money, Financial Transactions, and Financial Institutions

The Financial Information Marketplace

The Future of the Financial System and the Money and Capital Markets

The Determinants of Interest Rates: Competing Ideas

Measuring and Calculating Interest Rates and Financial Asset Prices

Inflation and Deflation, Yield Curves, and Duration: Impact on Interest Rates and Asset Prices

The Risk Structure of Interest Rates: Defaults, Prepayments, Taxes, and Other Rate-Determining Factors

Interest-Rate Forecasting and Hedging: Swaps, Financial Futures, and Options

Introduction to the Money Market and the Roles Played by Governments and Security Dealers

Commercial Banks, Major Corporations, and Federal Credit Agencies in the Money Market

Roles and Services of the Federal Reserve and Other Central Banks Around the World

The Tools and Goals of Central Bank Monetary Policy

The Commercial Banking Industry: Structure, Products, and Management

Nonbank Thrift Institutions: Savings and Loans, Savings Banks, Credit Unions, and Money Market Funds

Mutual Funds, Insurance Companies, Investment Banks, and Other Financial Firms

Regulation of the Financial Institutions Sector

Federal, State, and Local Governments Operating in the Financial Markets

Business Borrowing: Corporate Bonds, Asset-Backed Securities, Bank Loans, and Other Forms of Business Debt

The Market for Corporate

Consumer Lending and Borrowing

International Transactions and Currency Values

International Banking

Filters

Exam 22: The Residential Mortgage Market Stock

According to your text mortgage pools or trusts account for approximately what percentage of mortgages in the U.S. market?

Please identify the following federal agencies and describe their roles or functions: FHA, VA, FHLB, FNMA, GNMA and FHLMC.

A strong housing market can provide an incentive for households to refinance their homes simply to capture some of the additional equity associated with rising home prices.

Like the Federal housing administration (FHA) the veteran's administration (VA) offered to insure residential mortgages and helped to _____________________ required to buy a new homes.

Securities issued by Freddie Mac are not guaranteed by the federal government.

What is a loan modification agreement? What is its purpose?

What has happened in recent years to the prices of new homes? To interest rates and other terms on conventional home mortgage loans? What are the causes of these trends?

What is a mortgage lock-in? Does it benefit the borrower or the lender? When might it not be a good idea?

Mortgage pools or trusts now account for more mortgage loans than savings and loans associations according to your text.

When two home owners trade their houses with each other this is known as a:

Please list the principal mortgage lending institutions in the United States. Which is most important? In what particular areas of the market?

How has the federal government's intervention in the home mortgage market over the past several decades changed the structure and operation of the home mortgage market? For what reason has all of this been done?

Residential mortgages may be classified in several different ways. Please describe the structure of the mortgage market as it relates to each of the following dimensions:

How does the behavior of the home mortgage market reveal the problems that both home buyers and mortgage lenders face as they operate in this huge financial marketplace?

Functions and Roles of the Financial System in the Global Economy

Financial Assets, Money, Financial Transactions, and Financial Institutions

The Financial Information Marketplace

The Future of the Financial System and the Money and Capital Markets

The Determinants of Interest Rates: Competing Ideas

Measuring and Calculating Interest Rates and Financial Asset Prices

Inflation and Deflation, Yield Curves, and Duration: Impact on Interest Rates and Asset Prices

The Risk Structure of Interest Rates: Defaults, Prepayments, Taxes, and Other Rate-Determining Factors

Interest-Rate Forecasting and Hedging: Swaps, Financial Futures, and Options

Introduction to the Money Market and the Roles Played by Governments and Security Dealers

Commercial Banks, Major Corporations, and Federal Credit Agencies in the Money Market

Roles and Services of the Federal Reserve and Other Central Banks Around the World

The Tools and Goals of Central Bank Monetary Policy

The Commercial Banking Industry: Structure, Products, and Management

Nonbank Thrift Institutions: Savings and Loans, Savings Banks, Credit Unions, and Money Market Funds

Mutual Funds, Insurance Companies, Investment Banks, and Other Financial Firms

Regulation of the Financial Institutions Sector

Federal, State, and Local Governments Operating in the Financial Markets

Business Borrowing: Corporate Bonds, Asset-Backed Securities, Bank Loans, and Other Forms of Business Debt

The Market for Corporate

Consumer Lending and Borrowing

International Transactions and Currency Values

International Banking

Filters