Private mortgage insurance-federal mortgage insurance

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Reference no: EM13795908

1. Explain the course of action adopted by the federal government to restore the confidence in the U.S. mortgage & real estate markets in the aftermath of the Great Depression, and how these changes affected the structure of a typical mortgage loan agreement.

2. Explain the general differences between:

Private Mortgage Insurance (PMI)

Federal Mortgage Insurance (FHA, VA)

in terms of the size of the mortgage cap, initial & annual fees.

3. Explain the reasons behind inception of the Mortgage Backed Securities (MBSs).

Use an example of a typical bank’s (thrift) balance sheet to illustrate the root problem leading to the creation of the MBSs

Reference no: EM13795908

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