Heroic Investing
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HI 117 – Remembering the Lost, Wrap Around Mortgages & ARMs

Episode: 117

Guest: Gary Pinkerton & Jason Hartman

iTunes: Stream Episode

Gary Pinkerton starts off the show thanking all the service members and remembering those who have been lost, especially in the attacks of 9/11. He then moves on to discuss how sometimes you have to let a deal go.

Then Jason Hartman talks with Naresh as they take a deep dive into the adjustable-rate mortgage, breaking it down into easy to understand piece parts. They also discuss the wrap around mortgage, what the term negative rate means and give numerical examples to clearly explain each distinct type of calculation.

Key Takeaways:

[6:12] Sometimes you have to walk away from a deal

[10:46] 5 Elements of adjustable-rate mortgages (ARM)

[12:19] 1. Start or Teaser rate

[13:10] 2. Index

[15:20] 3. Margin

[16:50] 4. Annual cap – 3 types

[21:38] Negative interest rates

[26:17] Negative amortization rate

[27:05] Sophisticated investing techniques

[30:43] AITD – Wrap around mortgage