Debt consolidation describes the process of combining various different loans into one mortgage, usually via home refinancing.
Because a mortgage is a loan secured against property, it normally has the lowest interest rates in terms of consumer loans.
And with the high amount of funds a home owner can obtain due to a considerable home value, it makes financial sense to leverage home equity to pay off all existing debt with much higher interest rates.
A mortgage broker is an independent contractor that offers a huge basket of home loans originating from various lenders.
While there are brokerages these days that become correspondent lenders, a pure mortgage broker will not originate or offer their own loan products.
The absence of their own portfolio of loans enable a mortgage brokerage to maintain it’s status as being independent of lenders and practicing no bias of one over another.
Conventional wisdom tell us that the bigger the down payment, the lesser we owe the bank.
And therefore, the more equity we have on the house, and the less interest costs we end up paying the greedy money bags.
However, times have changed.
The secondary mortgage market is the financial market for the sale and purchase of mortgages and mortgage-backed securities.
Securities and bonds collateralized by the value of mortgage can take many forms including:
The secondary mortgage market was initially started by Ginny Mae with the intention to be a new source of capital for the market.