Questions from Financial Markets


Q: Why might zero-down home mortgages have a higher default rate

Why might zero-down home mortgages have a higher default rate than traditional home mortgages?

See Answer

Q: Explain why adjustable-rate mortgages, while beneficial for some,

Explain why adjustable-rate mortgages, while beneficial for some, often turned out to be very harmful to others, especially the teaser-rate variation of the ARM.

See Answer

Q: A home mortgage where the monthly payment is not enough to pay

A home mortgage where the monthly payment is not enough to pay the monthly principal payment is called

See Answer

Q: What is Fannie Mae? What was it originally established to do

What is Fannie Mae? What was it originally established to do?

See Answer

Q: Explain what a CMO is. How do tranches work?

Explain what a CMO is. How do tranches work?

See Answer

Q: Stan has worked for the same firm for over 30 years and

Stan has worked for the same firm for over 30 years and has a defined benefits pension. However, he is worried the pension fund where he works is underfunded. Explain to someone with no training in ec...

See Answer

Q: In a collateralized debt obligation (CDO) such as a collateralized

In a collateralized debt obligation (CDO) such as a collateralized mortgage obligation (CMO), the senior tranche:

See Answer

Q: Explain how the economic policies of both the Clinton and George W

Explain how the economic policies of both the Clinton and George W. Bush Administrations toward home ownership helped to contribute to the financial crisis.

See Answer

Q: Explain how an increase in defaults of home mortgages in the United

Explain how an increase in defaults of home mortgages in the United States could affect savers on the other side of the world via CMOs.

See Answer

Q: In subprime home mortgages the term subprime refers to:

In subprime home mortgages the term subprime refers to:

See Answer