FIM06C12金融机构课件

FIM06C12金融机构2024/4/16FIM06C12金融机构ChapterPreview PartoftheAmericanDreamistoownyourownhome.Buttheaveragepriceofahomeiswellover$140,000(andquiteabithigherissomeareas,likeCalifornia).Formostofus,homeownershipwouldbeimpossiblewithoutborrowingmostofthecostofahome.FIM06C12金融机构ChapterPreviewInthischapter,weidentifycharacteristicsoftypicalresidentialmortgagesandtheusualtermandtypesofmortgagesavailable.Wethenreviewwhoprovidesandservicestheloans,alongwiththegrowthinthesecondarymortgagemarket.Topicsinclude:WhatAreMortgages?CharacteristicsofResidentialMortgagesTypesofMortgageLoansMortgage-LendingInstitutionsFIM06C12金融机构ChapterPreview(cont.)LoanServicingSecondaryMortgageMarketSecuritizationofMortgagesTheImpactofSecuritizedMortgagesontheMortgageMarketFIM06C12金融机构WhatAreMortgages?Along-termloansecuredbyrealestateAnamortizedloanwherebyafixedpaymentpaysbothprincipalandinteresteachmonthFIM06C12金融机构WhatAreMortgages?ThenextslideshowsthetotalamountofmortgagedebtoutstandingintheU.S.during2006.Itfurtherdelineatesbytype

ofproperty.Thetableshowsroughly$13trillionoutstanding.HowdoesthiscomparetothevalueofallthestockontheNYSE?FIM06C12金融机构WhatAreMortgages?

MortgageLoanBorrowersFIM06C12金融机构WhatAreMortgages?HistoryMortgageswereusedinthe1880s,butmassivedefaultsintheagriculturalrecessionof1890madelong-termmortgagesdifficulttoattain.Untilpost-WWII,mostmortgageloanswereshort-termballoonloanswithmaturitiesoffiveyearsorless.FIM06C12金融机构WhatAreMortgages?HistoryBalloonloans,however,causedproblemsduringthedepression.Typically,thelenderrenewstheloan.But,withsomanyAmericansoutofwork,lenderscouldnotcontinuetoextendcredit.Asapartofthedepressionrecoveryprogram,thefederalgovernmentassistedincreatingthestandard30-yearmortgageweknowtoday.FIM06C12金融机构Characteristicsof

theResidentialMortgageMortgagescanberoughlyclassifiedalongthefollowingthreedimensions:MortgageInterestRatesLoanTermsMortgageLoanAmortizationFIM06C12金融机构Avarietyoffunmortgagecalculators/calculators/index.shtmlCharacteristicsoftheResidentialMortgage:MortgageInterestRatesThestatedrateonamortgageloanisdeterminedbythreerates:MarketRates:generalrateson

TreasurybondsTerm:longer-termmortgageshave

higherratesDiscountPoints:alowerratesnegotiatedforcashupfrontFIM06C12金融机构Avarietyoffunmortgagecalculators/calculators/index.shtmlCharacteristicsoftheResidentialMortgage:MortgageInterestRatesThenextslideshowstherelationshipbetweenmortgageratesandlong-termtreasuryrates.Ascanbeseen,mortgageratesaretypicallyhigherthanTreasuryrates,butthespread(difference)betweenthetwovariesconsiderably.FIM06C12金融机构Currentmortgageinterestrates/CharacteristicsoftheResidentialMortgage:MortgageInterestRatesFIM06C12金融机构Avarietyoffunmortgagecalculators/calculators/index.shtmlCharacteristicsoftheResidentialMortgage:MortgageInterestRates&PointsAdifficultdecisionwhengettingamortgageiswhethertopaypoints(cash)upfrontinexchangeforalowerinterestrateonthemortgage.Supposeyouhadtochoosebetweena12%30-yearmortgageoran11.5%mortgagewith2discountpoints.Whichshouldyouchoose?Assumeyouwishedtoborrow$100,000.FIM06C12金融机构CharacteristicsoftheResidentialMortgage:MortgageInterestRates&Points First,examinethe12%mortgage.

Usingafinancialcalculator,therequiredpaymentsis: n=360,i=1.0,PV=100,000, CalculatethePMT.PMT=$1,028.61FIM06C12金融机构CharacteristicsoftheResidentialMortgage:MortgageInterestRates&Points Now,examinethe11.5%mortgage.Using

afinancialcalculator,therequiredpaymentsis: n=360,i=11.5/12,PV=100,000, CalculatethePMT.PMT=$990.29FIM06C12金融机构CharacteristicsoftheResidentialMortgage:MortgageInterestRates&PointsSo,payingthepointswillsaveyou$38.32

eachmonth.However,youhavetopay

$2,000upfront.Youcanseethatthedecisiondependsonhowlongyouwanttoliveinthehouse,keepingthesamemortgage.FIM06C12金融机构CharacteristicsoftheResidentialMortgage:MortgageInterestRates&PointsIfyouonlywanttolivethere12months,clearlythe$2,000upfrontcostisnotworththemonthlysavings.Let’sseehowtodeterminetheanswer.FIM06C12金融机构CharacteristicsoftheResidentialMortgage:MortgageInterestRates&Points Youneedtodeterminewhenthepresentvalueofthesavings($38.32)equalsthe$2,000upfront.Usingafinancialcalculator,thisis: i=1,PV=-2,000,PMT=38.32 Calculaten.n=74months,orabout

6.2years.FIM06C12金融机构CharacteristicsoftheResidentialMortgage:MortgageInterestRates&Points So,ifyouthinkyouwillstayinthehouseandnotrefinanceforatleast6.2years,payingthe$2,000forthelowerpaymentisasoundfinancialdecision. Otherwise,youshouldacceptthe

12%loan.FIM06C12金融机构CharacteristicsoftheResidentialMortgage:MortgageInterestRates&Points Thenexttablefurtherillustratesthispoint,showingtheeffectiverateonthe11.5%mortgageifthemortgageispaidinfullatvariouspoints. Notethatrightaroundyear6,theeffectiveannualrateonthe11.5%mortgageisaboutthesameaseffectiveannualrateonthe12%mortgage(12.68%).FIM06C12金融机构CharacteristicsoftheResidentialMortgage:EffectiveRateofInterestFIM06C12金融机构CharacteristicsoftheResidentialMortgage:LoanTerms Mortgageloancontractscontainmanylegaltermsthatneedtobeunderstood.Mostprotectthelenderfromfinancialloss.Collateral:usuallytherealestate

beingfinanceDownpayment:aportionofthepurchasepricepaidbytheborrowerFIM06C12金融机构CharacteristicsoftheResidentialMortgage:LoanTerms Mortgageloancontractscontainmanylegaltermsthatneedtobeunderstood.Mostprotectthelenderfromfinancialloss.PMI:insuranceagainstdefaultby

theborrowerQualifications:includescredithistory,employmenthistory,etc.,todeterminetheborrowersabilitytorepaythemortgageasspecifiedinthecontactFIM06C12金融机构CharacteristicsoftheResidentialMortgage:LoanTerms Lenderswillalsoorderacreditreportfromoneofthecreditreportingagencies.ThescorereportediscalledtheFICO.Therangeis300to850,with660to720beingaverage.Paymenthistory,debt,andevencreditcardapplicationscanaffectyourcreditscore.FIM06C12金融机构CharacteristicsoftheResidentialMortgage:LoanAmortization Mortgageloansareamortizedloans.Thismeansthatafixed,levelpaymentwillpayinterestdueplusaportionoftheprincipaleachmonth.Itisdesignedsothatthebalanceonthemortgagewillbezerowhenthelastpaymentismade. Thenexttableshowsatypicalamortizationtablefora30-yearmortgageat8.5%.FIM06C12金融机构CharacteristicsoftheResidentialMortgage:LoanAmortizationScheduleFIM06C12金融机构TypesofMortgageLoansInsuredvs.ConventionalMortgages:ifthedownpaymentislessthan20%,insuranceisusuallyrequiredFixed-RateMortgages:theinterestrateisfixedforthelifeofthemortgageAdjustable-RateMortgages:theinterestratecanfluctuatewithincertainparametersFIM06C12金融机构TypesofMortgageLoansOtherTypesGraduated-PaymentMortgages(GPMs)GrowingEquityMortgages(GEMs)Shared-AppreciationMortgages(SAMs)EquityParticipationMortgagesSecondMortgagesReverseAnnuityMortgages(RAMs)Thefollowingtablelistsadditionalcharacteristicsonalltheloans.FIM06C12金融机构TypesofMortgageLoansFIM06C12金融机构Mortgage-LendingInstitutionsOriginally,thriftinstitutionsweretheprimaryoriginatorofmortgagesintheU.S.and,therefore,theprimaryholderofmortgageloans.Asthenextfigureillustrates,thisisnotthecaseanymore.FIM06C12金融机构Mortgage-LendingInstitutionsFIM06C12金融机构LoanServicingMostmortgagesareimmediatelysoldtoanotherinvestorbytheoriginator.Thisfreescashtooriginateanotherloanandgenerateadditionalfeeincome.Still,someonehastocollectthemonthlypaymentsandkeeprecords.Thisisknowsasloanservicing,andservicersusuallykeepaportionofthepaymentsreceivedtocovertheircosts.FIM06C12金融机构LoanServicing Inall,therearethreedistinctelementsinmortgageloans:Theoriginatorpackagestheloanfor

aninvestorTheinvestorholdstheloanTheservicingagenthandlesthepaperworkFIM06C12金融机构SecondaryMortgageMarketThesecondarymortgagemarketwasoriginallyestablishedbythefederalgovernmentafterWWIIwhenitcreatedFannieMaetobuymortgagesfromthrifts.Themarketexperiencedtremendousgrowthintheearlytomid-1980,andhascontinuedtoremainastrongmarketin

theU.S.FIM06C12金融机构SecuritizationofMortgages Thesecuritizationofmortgagesdevelopedbecauseofproblemsdealingwithsinglemortgages:riskofeitherdefaultorprepaymentandservicing.Poolsofmortgageseliminatedpartofthisproblemthroughdiversification.FIM06C12金融机构SecuritizationofMortgages Themortgage-backedsecurity(MBS)wascreated.Poolsincludinghundredsofmortgagesweregathered,andtherightstothecashflowsgeneratedbythemortgagesweresoldasseparatesecurities. Atfirst,simplepass-throughsecurities

weredesigned.FIM06C12金融机构SecuritizationofMortgages:

TheMortgagePass-ThroughDefinition:Asecuritythathastheborrower’smortgagepaymentspassthroughthetrusteebeforebeingdisbursedtotheinvestorsThisdesigndideliminatesomerisk,butinvestorsstillfacedprepaymentrisk.FIM06C12金融机构SecuritizationofMortgages:CMOsDefinition:ACMOisastructuredMBSwhereinvestorpoolshavedifferentrightstodifferentsetsofcashflows.Thisdesignstructuredtheprepaymentrisk.Someclasseshadlittle,whileotherhad

alot.FIM06C12金融机构TheImpactofSecuritizationontheMortgageMarketAsthenextfigureshows,thevalueofmortgagesheldinpoolsisreaching$6.4trillionneartheendof2006.Thesecuritiescompeteforfundsalongwithallotherbondmarketparticipants.FIM06C12金融机构MortgagePoolsFIM06C12金融机构TheImpactofSecuritization

ontheMortgageMarketBenefitsReducestheproblemscausedbyregionallendinginstitution’ssensitivitytolocaleconomicfluctuationsBorrowershaveaccesstoanationalcapitalmarketInvestorshavelow-riskandlong-terminvestmentsinmortgageswithouthavingtoservicetheloanFIM06C12金融机构TheImpactofSecuritization

ontheMortgageMarket However,thisisnotwithoutitscosts.Becauseofsecuritization,mortgagerateshavebecomemorenationalinnature,andthishasleadtoincreasedvolatilityinmortgagerates.FIM06C12金融机构TheSubprimeMortgageMarketIn2000,only2%ofmortgagesweresubprime.Thisclimbedto17%by2006.TheaverageFICOscorewas624forsubprimeborrowers.Primemortgageborrowerswere742.Mortgageproductsbecamemorecomplicated,andincomerequirementsforthesemortgagesbecameverylax.FIM06C12金融机构TheSubprimeMortgageMarketSubprimemortgageshavebecomequitecontroversial.Althoughpredatoryadvertisingand“baitandswitch”tacticswer