Which GSE was originally created to serve savings and loan associations specifically?
Correct Answer
B) Freddie Mac
Freddie Mac (Federal Home Loan Mortgage Corporation) was created in 1970 specifically to provide a secondary market for savings and loan associations, while Fannie Mae originally served commercial banks and mortgage companies.
Why This Is the Correct Answer
Freddie Mac (Federal Home Loan Mortgage Corporation) was created in 1970 specifically to provide a secondary market for savings and loan associations, while Fannie Mae originally served commercial banks and mortgage companies.
More Mortgage Knowledge Questions
A borrower is comparing two loan offers: Loan A has no points and 4.5% interest rate, Loan B has 2 points and 4.0% interest rate. The loan amount is $400,000. How much will the borrower pay upfront for the points on Loan B?
A lender charges a 1% origination fee on all loans. For a borrower obtaining a $250,000 mortgage, what is the maximum origination fee that can be charged without violating the points and fees test under the ATR/QM rule for a first-lien mortgage?
Under what circumstances can a Qualified Mortgage include a prepayment penalty?
A borrower is considering paying discount points to reduce their interest rate. Each point costs 1% of the loan amount and reduces the rate by 0.25%. On a $300,000 loan, how much would the borrower pay for 2 discount points?
A borrower asks about the difference between discount points and origination fees. What is the most accurate explanation?
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A borrower purchased a home using seller financing with no institutional lender involved. Two years later, they want to obtain a traditional mortgage to pay off the seller and get cash for improvements. The seller financing balance is $200,000, and they want a new loan for $250,000. How is this transaction classified?