Title: Explain different types of mortgage loans.
Course: Real Estate (12154) > Section: Exploring Real Estate Financing

Explanation should include examples of loans such as

- straight
- amortized
- adjustable-rate mortgage (ARM)
- growing equity
- balloon payment
- reverse
- buying subject to.

DPOR correlations: 18VAC135-20-400. 6 (Mortgages and deeds of trust); 18VAC135-20-400. 7 (Types of mortgages); 18VAC135-20-400. 14 (Real estate financing)

Process/Skill Questions:

- Explain the difference between an ARM and a fixed-rate mortgage? How is the rate calculated on an ARM? What are the most common terms for ARMs?
- What are the general qualifications for each type of mortgage?
- What are the circumstances that must apply for a mortgage to be assumed by another borrower other than the original mortgagee?
- How might a growing equity mortgage meet the needs of a customer whose income is expected to continue to increase over time?
- What type of borrower might benefit from the monthly payments of a reverse-annuity mortgage?