Hi Everybody,

Can anybody please highlight the key differences between Residential and Commercial mortgages for US market. Any link elaborating this differences will also be appreciated. I am looking from the perspective of differences in Origination, Servicing and Securitization.

Thanks,
Raghav

Its very simple Raghav. The commercial mortgage index is based on what we call in the commercial lending world as COFI or the Cost Of Funds Index. This is used to determine what the cost of funds are that banks borrow money on from the 11th district of the FHLB or Federal Home Loan Bank, Or more simply put the FEDS. The Residential Index is called the "Prime Index" or Prime Rate. The two virtualy run parallel to eachother with very little difference between the two,except the margin is slightly different. The cost to borrow any Federal Funds or Non-Private funds in this country is based on the Prime Rate. I hoped I answered your question.

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Eric J. Albinson
Senior Mortgage Specialist
Easy Apps Mortgage
95 Washington St. Ste.2
Foxboro, MA 02038
888-441-EASY (3279)
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Cell: 508-250-7786
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www.easyappsmortgage.com

Eric, Thanks for your inputs..

I'll further research along the lines given by you. Mainly I was looking for some place where I can get this information in more details.

Raghav

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