Finance
What is a 'jumbo loan' in Delaware mortgage financing?
AAny loan over $100,000
BA loan that exceeds the conforming loan limits set by Fannie Mae/Freddie Mac✓ Correct
CA loan with a term longer than 30 years
DAn FHA loan for a multi-family property
Explanation
A jumbo loan is a mortgage that exceeds the conforming loan limits set by the Federal Housing Finance Agency (FHFA). Because it cannot be purchased by Fannie Mae or Freddie Mac, it typically carries higher interest rates.
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Key Terms to Know
Agency
A legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.
AmortizationThe gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Math Concepts
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