mortgage Broker – Answer- Functions as a middleman between the borrower and the
lender, negotiating, selling or arranging loans to be delivered to large investors
Mortgage Banker – Answer- Provide their own funds for the purpose of providing
mortgage financing
Correspondent Lender – Answer- Smaller in scale then mortgage bankers or brokers,
these lenders typically extended loans with their own funds at their own risk
Origination – Answer- The process of creating a new mortgage loan
Underwriting – Answer- Detailed process of evaluating a borrowers loan application to
determine the risk involved for the lender
Closing/Settlement – Answer- Consummation of a contractual real estate transaction in
which all appropriate documents are signed and the proceeds of the mortgage loan are
then distributed by the lender
Funding – Answer- The process of transferring funds into a title or escrow company for
disbursement
Housing and Economic Recovery Act of 2008 (HERA) – Answer- Designed to assist with
recovery and revitalization of America’s residential housing market
SAFE Act (Secure & Fair Enforement of Mortgage Licensing Act) – Answer- Sets a
minimum standard for licensing and registering mortgage loan originators.
M1 – Answer- Sum of currency held by the public and transaction deposits at depository
institutions
M2 – Answer- M1 plus savings accounts, certificates of deposit, and other liquid assets
monetary policy – Answer- Maintenance of a stable money supply that provides for
growth in the economy while keeping inflation in check. Federal reserve is responsible
for monetary policy
fiscal policy – Answer- Federal government spending.
The Federal Reserve – Answer- The central banking system of the United States
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Monetary inflation – Answer- Excess of money supply in the market
discount rate – Answer- Interest rate a Reserve Bank charges eligible financial
institutions to borrow funds on a short term basis.
federal funds rate – Answer- Is the rate that the federal reserve charges banks for
unsecured loans most of which are for a very short term (sometimes overnight) banks
use these to meet their liquidity requirements when withdrawals threaten to exceed
cash on hand
US Treasury – Answer- Primarily responsible for raising funds to finance the operations
of the US government. Management of fiscal policy
Office of the Comptroller of the Currency (OCC) – Answer- charters and regulates
national banks
US Mint – Answer- Make US coins
Department of housing and urban development (HUD 1965) – Answer- Create strong
sustainable inclusive communities and quality affordable homes.
The Federal Housing Administration (FHA) – Answer- Provides mortgage loans made by
FHA approved lenders through the United States and its territories
Community Development Block Grant (CDBG) – Answer- Help communities with
economic development, Job opportunities and housing rehabilitation
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 – AnswerPromote the financial stability of the United States by improving accountability and
transparency in the financial system, to end “to big to fail” to protect the American
taxpayer by ending bailouts to protect consumers from abusive financial services
practices and other purposes
Consumer Financial Protection Bureau (CFPB) – Answer- Examine and enforce
consumer protection regulations for all mortgage related business. Established under
Dodd-Frank
Community Reinvestment Act – Answer- A law requiring lenders to meet the needs of
the community in which they are charted to do business.
Redlining – Answer- a practice in which banks refuse to make loans to people living in
certain geographic locations
Equal Credit Opportunity Act (ECOA) 1974 – Answer- Ensures all consumers are given
an equal chance to obtain credit