A mortgage is generally defined as a loan used to finance the purchase of real estate or a home. These loans come in different types, rates and terms. The specifications of these loans are important, for they along with the initial down payment determine the monthly payment amounts due throughout the life of these loans. The right type of loan may depend on individual circumstances. For those seeking to finance or live in a home for only a few years, an ARM loan, or adjustable rate loan could be best. Those who are looking to stay in a home long term, a fixed rate loan may be best. Those lucky enough to be buying property for the first time may receive the best terms with a first time buyer mortgage. To determine which loan is best, the key concepts of all types of mortgages should be examined.
Tag-Archive for ◊ type ◊
You made the decision to buy the investment recommendations of John Smith a financial planner and advisor who is registered with Acme Financial. You thought John provided investment advice for fees because John neglected to tell you Acme is owned by a broker/dealer that in turn is owned by an insurance company.
Why is this important? The insurance company bought the broker/dealer to create more distribution for its own products. The broker/dealer may also require John to sell proprietary products in return for holding John’s securities licenses and providing support services.
This may sound innocent enough, but it’s not. What if the insurance company and broker/dealer produce inferior products and charge excessive expenses? There is no law against bad products or high expenses so you trust John to protect you from these risks. But John has a big problem. If he does what is best for you he gets in trouble with the companies that hold his licenses. If he does what is best for the companies he has to recommend bad products that undermine your financial future.
These core conflicts of interest vary by firm and ownership structure. Six primary types of companies sell investment and insurance products.
You made the decision to buy the investment recommendations of John Smith a financial planner and advisor who is registered with Acme Financial. You thought John provided investment advice for fees because John neglected to tell you Acme is owned by a broker/dealer that in turn is owned by an insurance company.
Why is this important? The insurance company bought the broker/dealer to create more distribution for its own products. The broker/dealer may also require John to sell proprietary products in return for holding John’s securities licenses and providing support services.
This may sound innocent enough, but it’s not. What if the insurance company and broker/dealer produce inferior products and charge excessive expenses? There is no law against bad products or high expenses so you trust John to protect you from these risks. But John has a big problem. If he does what is best for you he gets in trouble with the companies that hold his licenses. If he does what is best for the companies he has to recommend bad products that undermine your financial future.
These core conflicts of interest vary by firm and ownership structure. Six primary types of companies sell investment and insurance products.
