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Name for me four different types of mortgages and why a client would select each one.

Answer examples and advice for how to answer this interview question for a Mortgage Loan Processor interview

How to Answer

Briefly display to the hiring manager that you understand the variances between 4 types of mortgages and why a client would find them appealing.

Name for me four different types of mortgages and why a client would select each one.
Answer example

"The four types of mortgages that I am most familiar with are Closed Mortgages, Fixed Rate Mortgages, Variable Rate Mortgages and Home equity lines of credit. I feel the reason why a client would choose a Closed Mortgage would be for...."

View user-submitted Answers

Name for me four different types of mortgages and why a client would select each one.
1.
Conventional - standard mortgage that would fit most borrowers FHA - for borrowers that may be somewhat credit challenged but can afford a mortgage VA - veterans would select this type of mortgage Reverse mortgage - for the elderly looking to pull some equity from their home.
2.
FHA- For first time home buyers, VA- For registered veterans who get a discounted interest rate, Jumbo- for very high value properties, HARP- For upside down mortgages refinances.
3.
Fix loan (wants to keep the house for a long time wants to have a monthly fix amount for payment), Adj loan (is not planning to keep the house for long term), balloon loan (want to pay lower monthly payments and pay a larder payoff, heloc (wants to draw funds as needed)
4.
Jumpo loan and consumer loan.
5.
Purchase - To own your own property, Refinance to take out some of the equity to refurbish the home or for college tuition., FHA - If you don't have much money for down payment, HARP - Modify your current payment.
6.
FHA: for people with debt, credit issues, new to housing market VA: Loans for Veterans with no strict limits on eligibility Conventional: Most typical loan for people with outstanding credit or low debt-income ratios. Bought directly through Freddie Mac or Fannie Mae Jumbo: Same more or less as conventional just a bigger loan and you need better credit, high income, down payment of 20-30% (also USDA: rural area homes, sometimes better but often out of the way with crumbling infrastructure)
7.
Fixed= client pays off a fixed rate over a fixed time period regardless of changes in trends that may cause the loan payment to increase or decrease. FHA= 1st time buyers with low or no downpayment and lower credit scores. It is secured by Mortgage insurance that is included in the payment of the loan. VA= former military and is usually no money down. Interest Only=borrow has option to pay only the interest on this loan for a specified period of time. Adjustable (ARM)= a client who wants a lower rate up front and is willing to have the payments balloon at a later date. Someone who.
8.
VA Loans, FHA Loans, Conventional Home Loan, Fixed vs. Adjustable Rate.
9.
Fixed rate mortgage, FHA mortgage, VA mortgage, Interest Only Mortgages.
10.
Fixed rate - no change in interest. Adjustable rate - lower interest rate for set period. Balloon - all funds due at a certain date. Interest only - lower payment for set period of time.
11.
Conventional, fha, va, rural.
12.
Conventional, FHA, VA, and unconventional.
13.
FHA, Fannie mae, USDA, fixed and adjustable rate.
14.
FHA - when don't have much for down payment, Conventional for customers with excellent credit scores, Subprime when have a poor credit scores and Reverse mortgage for old customers that have paid off their loan and have financial needs.
15.
Purchase, Refinance, Cash Out Refinance.
16.
Fha, fixed rate mortgage, va, variable rate.
17.
Fixed Rate Mortgage, Adjustable Rate Mortgage, Hybrid Mortgage, Secondary Mortgage.
18.
FHA, fannie mae, freddy mac & traditional.
19.
Home, commercial, adjustable rates and bussiness.
20.
Fixed Rate allows the interest rate to remain the same throughout the entire life of the loan. Adjustable Rate allows a client to purchase a more expensive home at a lower mortgage payment so long as interest rates do not rise. Interest-only allows the client to have a significantly lower monthly payment. Investor often choose this option. Then there is the Balloon Mortgage which are great for responsible borrowers with the intentions of selling the home before the due date of the balloon payment. Monthly payments are lower because the bulk of the loan is due at the end of the term.
21.
Fix rate, ajustable rate, conventional, government .
22.
A conventional loan is for clients who have a higher credit score and lower debt to income ratio. In contrast, an FHA loan would help someone out who may have a lower credit score and perhaps more debt. Another reason to go FHA over conventional would to have a co-signer. VA loans are in place for veterans and those currently in the military to get out of closing costs and no down payment. Another type of mortgage you might see is an Adjustable Rate Mortgage. Not seen as much now in todays economy, but it is for when interest rates are high, someone would gamble on the assumption that the rate would fall and they would be able to refinance at that point in the future.
23.
Fixed mortgage open mortgage closed mortgage concentional mortgage.
24.
There are many types of mortgages. You have FHA used for lower down payment and typically for FTHB. Conventional, this is used for many applicants, mainly homebuyers who are not restricted with their down payment situation. ARM, adjustable rate mortgages will vary based upon the market typically used for buyers that are looking to relocate and are going to reap the benefits during the beginning of the loan. VA loans are used for veterans and require 0% down.
25.
FHA: Down payment is low. VA: Down payment is zero and also Insurance premium is low. USDA : Down payment is low/zero along with rate of interest.
26.
A simple and fairly quick mortgage loan for a client would be a Conventional mortgage. The FHA mortgage requires additional documentation and The VA mortgage loans allow for veterans to have special privileges in purchasing a loan due to their sacrifice for defending our country and our alias.
27.
Personnel loan Tax loan Hire loan Mortgage loan.
28.
HARP - clients who may be upside down on their home or have limited income. VA- veterans needing a mortgage. FHA - A customer with a high LTV needed mortgage insurance, or for reverse mortgages. Conventional - Customers with money to put down, proven income, looking for a low interest rate.
29.
Fixed rate, adjustable, heloc and balloon mortgages. Fixed rate gives the client the opportunity to lock in a fixed rate that will not change over the life of the loan. An adjustable rate allows the client to pick from several options that can provide a lower rate in the long run, but also reduce the down payment. A HELOC allows the client to take out a line of credit based on the equity is his or her home. A balloon mortgage allows a client to make smaller payments in the beginning, but a large payment in the end.
30.
Fixed Rate Mortage ARM VA FHA Conventional.
31.
FHA - mfixed rate all taxes and Ins is included VA- rates are good for veteran Conventional- variable rate.
32.
VA HUD Conventinal FHA
33.
Va, fha, conforming, wholesale.
34.
Home, they would apply for this one, ready to buy a house, a fix mortgage, this is a mortgage that does change for the life of the loan, refinance, they want to get it refinance to get maybe a lower rate, and balloon mortgage they would make small payments in the beginning and than a large amount at the end of the loan.
35.
Conventional, best value if you have resources for a sufficient down payment and reasonably good credit. VA - able to loan 100% loan to value, FHA for those who are building or rebuilding credit with the ability to make a smaller down payment. USDA - for rural housing property that qualifies with no down payment and closing costs that can be financed. Good interest rates as well.
36.
FHA if there income qualifies them for lower down payment. Conventional VA
37.
Fha, va, conventional, construction loans. Customer's choose fha, va, conventional loans according to their financial need and construction loans are chosen by customer's that are building homes to meet their needs.
38.
Fixed rate mortgage and variable mortgage.

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