3. Primary and Secondary Markets in Real Estate

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What is the main function of the secondary market in real estate?

Creating mortgage loans

Facilitating home renovations

Promoting home ownership and investment in real estate (correct)

Regulating interest rates

How do the underwriting guidelines set by the GSEs impact lenders?

Prevent lenders from issuing loans

Motivate lenders to make loans following these standards (correct)

Encourage lenders to offer high-interest rates

Require lenders to invest in stocks

What is a loan called when a lender holds it as part of its own investments until repayment?

Collateralized loan

Securitized loan

Secondary loan

Portfolio loan (correct)

Which type of securities are considerably more liquid than mortgages?

Mortgage-backed securities Signup and view all the answers

Who issues mortgage-backed securities?

Fannie Mae and Freddie Mac Signup and view all the answers

Which government-sponsored entity has a greater impact on the mortgage industry than Ginnie Mae?

Fannie Mae Signup and view all the answers

What did the federal government implement in 2008 to stabilize the GSEs?

Various stabilization activities Signup and view all the answers

Why was the Federal Home Loan Mortgage Corporation created?

To assist savings and loan associations hit by a recession Signup and view all the answers

What was the original purpose of Freddie Mac?

Buy FHA and VA loans Signup and view all the answers

What are the rules applied when a loan applicant is being qualified by a lender called?

Underwriting guidelines Signup and view all the answers

3. Primary and Secondary Markets in Real Estate

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Questions and Answers

What is the main function of the secondary market in real estate?

How do the underwriting guidelines set by the GSEs impact lenders?

What is a loan called when a lender holds it as part of its own investments until repayment?

Which type of securities are considerably more liquid than mortgages?

Who issues mortgage-backed securities?

Which government-sponsored entity has a greater impact on the mortgage industry than Ginnie Mae?

What did the federal government implement in 2008 to stabilize the GSEs?

Why was the Federal Home Loan Mortgage Corporation created?

What was the original purpose of Freddie Mac?

What are the rules applied when a loan applicant is being qualified by a lender called?

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