Lesson 3: Mortgage 101

November 29, 2023

Review:

• How to buy
• 3 properties
• Interview assignment

Presentation:

• Interview assignment results
• Mortgage 101 – video series at realtor.com
  • BasicsRatesCredit RatingDown Payment
  • Home Loans
  • Mortgage Process
• Mortgage Types
  • Fixed vs ARM
  • 10, 15, 20, 30 – which amortization?
  • 1, 3, 5, 7, 10 – which initial time period (before ARM rate adjusts)?

Activity:

• Fresh Water Rust Belt Residential Investment Fund
  • John Rubino – Clean Money
  • Dr. Michael Burry – Investing in farmland
  • Choose an inexpensive market near the Great Lakes
  • These National Association of Realtors Housing Statistics might be helpful
  • Identify 3 target properties (within 1 market) for potential rental income investment
  • Properties should be livable with minimum 2 bedrooms and 1 bathroom
• Money for Nothing: Inside the Federal Reserve

Assignment:

1. Amortization Exercise
   • Use the 3 properties selected in class yesterday.
   • Check out current interest rates.
   • Read about amortization
     • Go to the Bankrate Amortization Schedule Calculator, scroll down and read:
       1. What is an amortization schedule?
       2. How do you calculate amortization?
       3. How do I calculate monthly payments?
   • Generate an amortization schedule
     • Scroll back up to the top of the page: Amortization Schedule Calculator
     • Use 20% of the home value as your down payment.
     • Generate an amortization schedule.
   • Save the amortization schedules
     1. Download or copy the amortization schedule into a spreadsheet
     2. Save the spreadsheet for later use
2. Interview write-up
   • Write up a 1-page summary from your interview assignment yesterday
   • Yes, only 1 page – you can do it!