User:Khushwantjhaj

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Khushwant Jhaj is a Financial Engineer and he is presently working in Investment Banking catagory. In his spare time he likes to educate people about basic Financial Foundation knowldge. He follows very simple thinking that you don't have to be car mechanic to know how to drive a car. What you need is a key and some direction how to handle the car.

He calls beautiful city of San Francisco his home. His life partner Baljinder Heer helps him with every aspect of life.

He believes that every body should know the basics of the Mortgage, Investment and Insurance. Because these are the three basic building block for every bodys financial building. And you cannot build one without a good blueprint. Financial Foundation is the building block of every family. If your foundation is right then you and your family will enjoy all the fruits of this life. There are some very basic things which every body should know and one of them is the Rule of 72

He has joined hands with World Financial Group and he believes that "No Family Left Behind".


[edit] What are different kinds of protection available for your assets and you?

[edit] Some reading for Mortgage

  • Adjustable Rate Mortgage (ARM)
  • Amortization (business)
  • Fixed-Rate Mortgage (FRM)
  • Fannie Mae - Federal National Mortgage Association.
  • Fair Isaac (FICO) - One of the three main credit bureaus. A FICO score of 600 would be similar to a "C" in public school grading or a "C-" in private school grading.
  • FHLB Advances - Funding provided by Federal Home Loan Banks.
  • Freddie Mac - Federal Home Loan Mortgage Corporation.
  • Government Sponsored Entity (GSE) - Private organizations with government charters whose function is to provide liquidity for the residential loan market. GSEs purchase loans from lenders and assume risk for the asset, thereby protecting the investors in the MBS.
  • Home Equity Loan (HEL)
  • Homeowners Insurance - Package policy that combines (1) coverage against the insured’s property being destroyed or damaged and (2) coverage for liability exposure of the insured.
  • Loan to value (LTV) - Loan Amount / Value of property.
  • No Income No Asset (NINA)
  • No Income Verification (NIV) Income is not verified but many times is "Stated" by the applicant borrower.
  • No Documentation (No Doc) Income or assets are not stated. Typically requires a low LTV and higher credit scores.
  • Manufactured housing (MH)
  • Mortgage Insurance (MI)
  • Mortgage Servicing Rights Mortgage Service Rights (MSR) - The capitalized asset that represents the value of the servicing fees to be realized over the life of the loan. (See also yield to maturity)
  • Pooling — The process of grouping together mortgage loans with similar characteristics.
  • Quitclaim deed (QCD)
  • Real estate appraisal
  • Second mortgage Additional loan that is subordinate to the primary mortgage
  • Secondary mortgage market — The market where lenders and investors buy and sell existing mortgages and MBS securities.
  • Securitization — The process of pooling loans into mortgage-backed securities for sale into the secondary mortgage market.
  • Verification of employment (VOE)

[edit] Islamic mortgages

Islamic Sharia law prohibits the payment or receipt of interest, which means that practising Muslims cannot use conventional mortgages. However, real estate is far too expensive for most people to buy outright using cash: Islamic mortgages solve this problem by having the property change hands twice. In one variation, the bank will buy the house outright and then act as a landlord. The homebuyer, in addition to paying rent, will pay a contribution towards the purchase of the property. When the last payment is made, the property changes hands.

An alternative scheme involves the bank reselling the property according to an installment plan, at a price higher than the original price.

In the United Kingdom, HSBC was the first major bank to offer Islamic mortgages.