A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
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- Warehouse fee
Many mortgage firms must borrow funds on a short term basis in order to originate loans
which are to be sold later in the secondary mortgage market (or to investors). When the
prime rate of interest is higher on short term loans than on mortgage loans, the mortgage
firm has an economic loss which is offset by charging a warehouse fee.
- Wraparound mortgage
Results when an existing assumable loan is combined with a new loan, resulting in an
interest rate somewhere between the old rate and the current market rate. The payments are
made to a second lender or the previous homeowner, who then forwards the payments to the
first lender after taking the additional amount off the top.
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A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
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