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our question comes from Alex in Michigan what's the difference between a home mortgage through a bank or a credit union in getting a mortgage to a mortgage company it might be no difference depending on how your bank or credit union did the mortgage there are three types of mortgages that are called conforming mortgages Fannie Mae which is conventional FNMA conventional loans FHA and VA Federal Housing Administration the Veterans Administration conforming means that each of those contendere making a VA loan that they want the Veterans Administration to insure has to conform to a set of Veterans Administration guidelines so all VA loans have conformed to a certain lending process then they can be packaged together and sold in blocks so you could take two take five $200,000 VA loans package them together as a million dollar block and sell them as a block that's called securitizing a mortgage okay same thing with a Fannie Mae loan all Fannie Mae loans follow the same guidelines banks and credit unions can make FHA loans they can make Fannie Mae loans and they can make VA loans if they have a mortgage department in them and then they can sell that loan only if it is conforming to those guidelines because no one will buy it if it's not conforming if it's not predictable because it was made on a certain set of guidelines if they just simply lend you the money from their bank or lend you the money from their credit union which can happen that's just a bank loan and that's what we call a portfolio loan which means they are going to keep that loan in their bank they can't sell it because it doesn't conform no one will buy it they can't sell it so they have to keep it in their portfolio and so they can use whatever lending guidelines they want they can just decide home equity loans are an example of that all home equity loans are portfolio loans they do not conform to any set standard guidelines each bank makes up their own guidelines and they keep those loans in their own portfolio meaning that bank lent that money that bank collects that money that bank won't sell it but you can almost a hundred percent of time predict that if you have a conforming loan it is going to be sold if you go to Bank X Bank of America and you love Bank of America which makes you not smart but if you do and you use Bank of America and you use Bank of America do an FHA loan don't be surprised if two weeks later countrywide or someone else owns that loan because Bank of America very likely did not intend to keep that conforming loan they set they buy and sell those things like you sell stock or something else you can move those loans around easily now mortgage companies almost never keep a loan like 99.99% of time like Churchill mortgage that we endorsed they do not portfolio anything a hundred percent of the loans that they make they have an investor already lined up to take that conforming loan so if you go to them and you get a conventional loan 15 year fixed where the payments no more than 1/4 of your take-home pay like we talked about all the time Churchill mortgage will own that lower loan for about 30 seconds after you sign all the paperwork it will already be lined up to be dumped into someone else's bucket and so don't expect Churchill to collect payments from you they're not in that business they set up the loans sell them into the deal and that that's simple it's that simple so you know and this is what gets people in trouble if you remember back in 2008 when the housing market crash what happened was a bunch of people were violating those conforming loans and some of the appraisers were lying on the appraisals and so some of the conventional loans that we had all come to count on is kind of the gold standard were bad there was a whole bunch of them were bad because they were the houses were overvalued and so when people quit paying and walked away from them it started crashing in on the security side of the business and these banks that were holding blocks of these mortgages 10 20 30 million dollar blocks of these mortgages started caving in and that's how that's what happened out there was that people were not following the conforming guidelines and and the some of the appraisers were jacked up in the middle of it and so appraisal the appraisal world got a lot more regulation out of that the banking world and mortgage world got a lot more regulation made out of that so that we don't end up with another bubble based on falsehood and that's the background on that but that's the deal so you can get your bank to make a loan of any kind if they keep it whatever you can dream up and they dream up and that's the deal you have that deal as long as they're going to keep it in their portfolio if you can talk your credit union into it do it that's why I send you to the credit union a lot of times for paying for a very small mortgage like if you're getting a $50,000 mortgage on a $200,000 house because you got a big down stroke you probably can get that with no closing costs no points on a fixed-rate better than you could get a conforming small FHA loan or small Fannie Mae loan because the mortgage company's going to tag you with a bunch of stuff you don't really need to do an appraisal on a house from a common sense perspective if you're looking under the $200,000 house making a $50,000 loan you can kind of go I think that's safe but if you're doing a Fannie Mae loan you still have to do the appraisal you still have to do a survey you still have to do all this stuff because you have to conform to their guidelines and that creates a bunch of unnecessary closing costs on a super small loan like that and so if you're getting a little dinky loan on a big ol house like that always do that at your credit union and just say hey I'll take it like a car payment right we'll set the thing up on five years fixed-rate no points no appraisal no closing costs no nothing just make me a car loan $50,000 car loan on my two hundred thousand on our house and as long as they're keeping that in their portfolio isn't whatever you can talk them into and they agree to that becomes your deal mortgage business become a very very interesting business and last few years