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Thursday, October 02, 2014

Conventional Mortgage Loan

: Any mortgage loan not guaranteed or insured by the government (typically through FHA or VA programs).


ORIGINATION OF RESIDENTIAL MORTGAGE LOANS

The original lender is called the mortgage originator. The principal originators of residential mortgage loans are thrifts, commercial banks, and mortgage bankers. Mortgage originators may service the mortgages they originate, for which they obtain a servicing fee.

When a mortgage originator intends to sell the mortgage, it will obtain a commitment from the potential investor (buyer). Two government-sponsored enterprises (GSEs) and several private companies buy mortgages. Because these entities pool these mortgages and sell them to investors, they are called conduits. When a mortgage is used as collateral for the issuance of a security, the mortgage is said to be securitized
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