Mortgage Loans- A More In Depth Look

By: Jamie Jones Lavelle

The mortgage lending process can seem overwhelming. This is because it contains certain nuances that only seem to be privy to a chosen few. Most people feel that the mortgage industry is a maze of confusion that usually traps people for upwards of 30 years.

A time came in my life as a child when my mother, father, and I had the blessing of having our own house. My folks spent countless nights discussing all of the things they would have to get in order so the dream of ownership would become a reality.

During this mortgage acquisition process my mother would always jokingly have something to say about some woman named Fannie Mae. Mother never did mention the lady's last name but apparently she was the holder of the cash.

Years later I actually found out that this Fannie Mae person was really the Federal National Mortgage Association. This organization is one of the players in the secondary mortgage market.

The Federal National Mortgage Association is vital in the process of cycling and recycling money that was loaned to homeowners. By doing this, loans that fund mortgages become more affordable to more people looking to purchase a home.

Three Huge Players In The Mortgage Market

Primary lenders, the secondary market, and the private mortgage insurance market are the three big players that form the mutually beneficial mortgage industry. Birth from a change in how local mortgage lenders used to do business when they made mortgage loans to people in the community only to keep the loans in the bank's investment portfolio until it was paid in full.

The three mortgage market players put on a production of sorts as they help each other meet with three specific goals. They all work together as well as separately to help investments in their particular niche market. Of course they want to protect the sustainability of each other in the mortgage. Last but certainly not least is their mission to make home ownership come true for more people.

Knowing at least a little information about exactly where your mortgage money will be coming from will give you peace of mind. Knowing why certain lenders require certain things will help you get prepared before you need to be.

Asking the tough questions and not being afraid of the difficult answers can separate those just plain smart people from the people who are smart enough to be dumb about some things.

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