document_title: Mortgage loan

question_text: where do you go to get a mortgage loan

question_tokens: where do you go to get a mortgage loan

text: Mortgage loan

text: Mortgage loan basics[edit]

text: Basic concepts and legal regulation[edit]

text: According to Anglo-American property law, a mortgage occurs when an owner (usually of a fee simple interest in realty) pledges his or her interest (right to the property) as security or collateral for a loan. Therefore, a mortgage is an encumbrance (limitation) on the right to the property just as an easement would be, but because most mortgages occur as a condition for new loan money, the word mortgage has become the generic term for a loan secured by such real property. As with other types of loans, mortgages have an interest rate and are scheduled to amortize over a set period of time, typically 30 years. All types of real property can be, and usually are, secured with a mortgage and bear an interest rate that is supposed to reflect the lender's risk.

text: Mortgage lending is the primary mechanism used in many countries to finance private ownership of residential and commercial property (see commercial mortgages). Although the terminology and precise forms will differ from country to country, the basic components tend to be similar:

text:
Property: the physical residence being financed. The exact form of ownership will vary from country to country, and may restrict the types of lending that are possible.
Mortgage: the security interest of the lender in the property, which may entail restrictions on the use or disposal of the property. Restrictions may include requirements to purchase home insurance and mortgage insurance, or pay off outstanding debt before selling the property.
Borrower: the person borrowing who either has or is creating an ownership interest in the property.
Lender: any lender, but usually a bank or other financial institution. (In some countries, particularly the United States, Lenders may also be investors who own an interest in the mortgage through a mortgage-backed security. In such a situation, the initial lender is known as the mortgage originator, which then packages and sells the loan to investors. The payments from the borrower are thereafter collected by a loan servicer.[3])
Principal: the original size of the loan, which may or may not include certain other costs; as any principal is repaid, the principal will go down in size.
Interest: a financial charge for use of the lender's money.
Foreclosure or repossession: the possibility that the lender has to foreclose, repossess or seize the property under certain circumstances is essential to a mortgage loan; without this aspect, the loan is arguably no different from any other type of loan.
Completion: legal completion of the mortgage deed, and hence the start of the mortgage.
Redemption: final repayment of the amount outstanding, which may be a "natural redemption" at the end of the scheduled term or a lump sum redemption, typically when the borrower decides to sell the property. A closed mortgage account is said to be "redeemed".

text: Many other specific characteristics are common to many markets, but the above are the essential features. Governments usually regulate many aspects of mortgage lending, either directly (through legal requirements, for example) or indirectly (through regulation of the participants or the financial markets, such as the banking industry), and often through state intervention (direct lending by the government, by state-owned banks, or sponsorship of various entities). Other aspects that define a specific mortgage market may be regional, historical, or driven by specific characteristics of the legal or financial system.

text: Mortgage loans are generally structured as long-term loans, the periodic payments for which are similar to an annuity and calculated according to the time value of money formulae. The most basic arrangement would require a fixed monthly payment over a period of ten to thirty years, depending on local conditions. Over this period the principal component of the loan (the original loan) would be slowly paid down through amortization. In practice, many variants are possible and common worldwide and within each country.

text: Lenders provide funds against property to earn interest income, and generally borrow these funds themselves (for example, by taking deposits or issuing bonds). The price at which the lenders borrow money therefore affects the cost of borrowing. Lenders may also, in many countries, sell the mortgage loan to other parties who are interested in receiving the stream of cash payments from the borrower, often in the form of a security (by means of a securitization).

text: Mortgage lending will also take into account the (perceived) riskiness of the mortgage loan, that is, the likelihood that the funds will be repaid (usually considered a function of the creditworthiness of the borrower); that if they are not repaid, the lender will be able to foreclose on the real estate assets; and the financial, interest rate risk and time delays that may be involved in certain circumstances.

text: Mortgage underwriting[edit]

text: Once the mortgage application enters into the final steps, the loan application is moved to a Mortgage Underwriter. The Underwriter verifies the financial information that the applicant has provided to the lender. Verification will be made for the applicant’s credit history and the value of the home being purchased.[4] An appraisal may be ordered. The financial and employment information of the applicant will also be verified. The underwriting may take a few days to a few weeks. Sometimes the underwriting process takes so long that the provided financial statements need to be resubmitted so they are current.[5] It is advisable to maintain the same employment and not to use or open new credit during the underwriting process. Any changes made in the applicant’s credit, employment, or financial information can result in the loan being denied.

text: Mortgage loan types[edit]

text: There are many types of mortgages used worldwide, but several factors broadly define the characteristics of the mortgage. All of these may be subject to local regulation and legal requirements.

text:
Interest: Interest may be fixed for the life of the loan or variable, and change at certain pre-defined periods; the interest rate can also, of course, be higher or lower.
Term: Mortgage loans generally have a maximum term, that is, the number of years after which an amortizing loan will be repaid. Some mortgage loans may have no amortization, or require full repayment of any remaining balance at a certain date, or even negative amortization.
Payment amount and frequency: The amount paid per period and the frequency of payments; in some cases, the amount paid per period may change or the borrower may have the option to increase or decrease the amount paid.
Prepayment: Some types of mortgages may limit or restrict prepayment of all or a portion of the loan, or require payment of a penalty to the lender for prepayment.

text: The two basic types of amortized loans are the fixed rate mortgage (FRM) and adjustable-rate mortgage (ARM) (also known as a floating rate or variable rate mortgage). In some countries, such as the United States, fixed rate mortgages are the norm, but floating rate mortgages are relatively common. Combinations of fixed and floating rate mortgages are also common, whereby a mortgage loan will have a fixed rate for some period, for example the first five years, and vary after the end of that period.

text:
In a fixed rate mortgage, the interest rate, remains fixed for the life (or term) of the loan. In case of an annuity repayment scheme, the periodic payment remains the same amount throughout the loan. In case of linear payback, the periodic payment will gradually decrease.
In an adjustable rate mortgage, the interest rate is generally fixed for a period of time, after which it will periodically (for example, annually or monthly) adjust up or down to some market index. Adjustable rates transfer part of the interest rate risk from the lender to the borrower, and thus are widely used where fixed rate funding is difficult to obtain or prohibitively expensive. Since the risk is transferred to the borrower, the initial interest rate may be, for example, 0.5% to 2% lower than the average 30-year fixed rate; the size of the price differential will be related to debt market conditions, including the yield curve.

text: The charge to the borrower depends upon the credit risk in addition to the interest rate risk. The mortgage origination and underwriting process involves checking credit scores, debt-to-income, downpayments, and assets. Jumbo mortgages and subprime lending are not supported by government guarantees and face higher interest rates. Other innovations described below can affect the rates as well.

text: Loan to value and down payments[edit]

text: Upon making a mortgage loan for the purchase of a property, lenders usually require that the borrower make a down payment; that is, contribute a portion of the cost of the property. This down payment may be expressed as a portion of the value of the property (see below for a definition of this term). The loan to value ratio (or LTV) is the size of the loan against the value of the property. Therefore, a mortgage loan in which the purchaser has made a down payment of 20% has a loan to value ratio of 80%. For loans made against properties that the borrower already owns, the loan to value ratio will be imputed against the estimated value of the property.

text: The loan to value ratio is considered an important indicator of the riskiness of a mortgage loan: the higher the LTV, the higher the risk that the value of the property (in case of foreclosure) will be insufficient to cover the remaining principal of the loan.

text: Value: appraised, estimated, and actual[edit]

text: Since the value of the property is an important factor in understanding the risk of the loan, determining the value is a key factor in mortgage lending. The value may be determined in various ways, but the most common are:

text:
Actual or transaction value: this is usually taken to be the purchase price of the property. If the property is not being purchased at the time of borrowing, this information may not be available.
Appraised or surveyed value: in most jurisdictions, some form of appraisal of the value by a licensed professional is common. There is often a requirement for the lender to obtain an official appraisal.
Estimated value: lenders or other parties may use their own internal estimates, particularly in jurisdictions where no official appraisal procedure exists, but also in some other circumstances.

tag: ol

text: Payment and debt ratios[edit]

text: In most countries, a number of more or less standard measures of creditworthiness may be used. Common measures include payment to income (mortgage payments as a percentage of gross or net income); debt to income (all debt payments, including mortgage payments, as a percentage of income); and various net worth measures. In many countries, credit scores are used in lieu of or to supplement these measures. There will also be requirements for documentation of the creditworthiness, such as income tax returns, pay stubs, etc. the specifics will vary from location to location.

text: Some lenders may also require a potential borrower have one or more months of "reserve assets" available. In other words, the borrower may be required to show the availability of enough assets to pay for the housing costs (including mortgage, taxes, etc.) for a period of time in the event of the job loss or other loss of income.

text: Many countries have lower requirements for certain borrowers, or "no-doc" / "low-doc" lending standards that may be acceptable under certain circumstances.

text: Standard or conforming mortgages[edit]

text: Many countries have a notion of standard or conforming mortgages that define a perceived acceptable level of risk, which may be formal or informal, and may be reinforced by laws, government intervention, or market practice. For example, a standard mortgage may be considered to be one with no more than 70–80% LTV and no more than one-third of gross income going to mortgage debt.

text: A standard or conforming mortgage is a key concept as it often defines whether or not the mortgage can be easily sold or securitized, or, if non-standard, may affect the price at which it may be sold. In the United States, a conforming mortgage is one which meets the established rules and procedures of the two major government-sponsored entities in the housing finance market (including some legal requirements). In contrast, lenders who decide to make nonconforming loans are exercising a higher risk tolerance and do so knowing that they face more challenge in reselling the loan. Many countries have similar concepts or agencies that define what are "standard" mortgages. Regulated lenders (such as banks) may be subject to limits or higher risk weightings for non-standard mortgages. For example, banks and mortgage brokerages in Canada face restrictions on lending more than 80% of the property value; beyond this level, mortgage insurance is generally required.[6]

text: Foreign currency mortgage[edit]

text: In some countries with currencies that tend to depreciate, foreign currency mortgages are common, enabling lenders to lend in a stable foreign currency, whilst the borrower takes on the currency risk that the currency will depreciate and they will therefore need to convert higher amounts of the domestic currency to repay the loan.

text: Repaying the mortgage[edit]

text: In addition to the two standard means of setting the cost of a mortgage loan (fixed at a set interest rate for the term, or variable relative to market interest rates), there are variations in how that cost is paid, and how the loan itself is repaid. Repayment depends on locality, tax laws and prevailing culture. There are also various mortgage repayment structures to suit different types of borrower.

text: Principal and interest[edit]

text: The most common way to repay a secured mortgage loan is to make regular payments toward the principal and interest over a set term.[citation needed] This is commonly referred to as (self) amortization in the U.S. and as a repayment mortgage in the UK. A mortgage is a form of annuity (from the perspective of the lender), and the calculation of the periodic payments is based on the time value of money formulas. Certain details may be specific to different locations: interest may be calculated on the basis of a 360-day year, for example; interest may be compounded daily, yearly, or semi-annually; prepayment penalties may apply; and other factors. There may be legal restrictions on certain matters, and consumer protection laws may specify or prohibit certain practices.

text: Depending on the size of the loan and the prevailing practice in the country the term may be short (10 years) or long (50 years plus). In the UK and U.S., 25 to 30 years is the usual maximum term (although shorter periods, such as 15-year mortgage loans, are common). Mortgage payments, which are typically made monthly, contain a repayment of the principal and an interest element. The amount going toward the principal in each payment varies throughout the term of the mortgage. In the early years the repayments are mostly interest. Towards the end of the mortgage, payments are mostly for principal. In this way the payment amount determined at outset is calculated to ensure the loan is repaid at a specified date in the future. This gives borrowers assurance that by maintaining repayment the loan will be cleared at a specified date, if the interest rate does not change. Some lenders and 3rd parties offer a bi-weekly mortgage payment program designed to accelerate the payoff of the loan.

text: An amortization schedule is typically worked out taking the principal left at the end of each month, multiplying by the monthly rate and then subtracting the monthly payment. This is typically generated by an amortization calculator using the following formula:

text: where:

text: Interest only[edit]

text: The main alternative to a principal and interest mortgage is an interest-only mortgage, where the principal is not repaid throughout the term. This type of mortgage is common in the UK, especially when associated with a regular investment plan. With this arrangement regular contributions are made to a separate investment plan designed to build up a lump sum to repay the mortgage at maturity. This type of arrangement is called an investment-backed mortgage or is often related to the type of plan used: endowment mortgage if an endowment policy is used, similarly a Personal Equity Plan (PEP) mortgage, Individual Savings Account (ISA) mortgage or pension mortgage. Historically, investment-backed mortgages offered various tax advantages over repayment mortgages, although this is no longer the case in the UK. Investment-backed mortgages are seen as higher risk as they are dependent on the investment making sufficient return to clear the debt.

text: Until recently[when?] it was not uncommon for interest only mortgages to be arranged without a repayment vehicle, with the borrower gambling that the property market will rise sufficiently for the loan to be repaid by trading down at retirement (or when rent on the property and inflation combine to surpass the interest rate)[citation needed].

text: Interest-only lifetime mortgage[edit]

text: Recent Financial Services Authority guidelines to UK lenders regarding interest-only mortgages has tightened the criteria on new lending on an interest-only basis. The problem for many people has been the fact that no repayment vehicle had been implemented, or the vehicle itself (e.g. endowment/ISA policy) performed poorly and therefore insufficient funds were available to repay balance at the end of the term.

text: Moving forward, the FSA under the Mortgage Market Review (MMR) have stated there must be strict criteria on the repayment vehicle being used. As such the likes of Nationwide and other lenders have pulled out of the interest-only market.

text: A resurgence in the equity release market has been the introduction of interest-only lifetime mortgages. Where an interest-only mortgage has a fixed term, an interest-only lifetime mortgage will continue for the rest of the mortgagors life. These schemes have proved of interest to people who do like the roll-up effect (compounding) of interest on traditional equity release schemes. They have also proved beneficial to people who had an interest-only mortgage with no repayment vehicle and now need to settle the loan. These people can now effectively remortgage onto an interest-only lifetime mortgage to maintain continuity.

text: Interest-only lifetime mortgage schemes are offered by two lenders currently – Stonehaven & more2life. They work by having the options of paying the interest on a monthly basis. By paying off the interest means the balance will remain level for the rest of their life. This market is set to increase as more retirees require finance in retirement.

text: Reverse mortgages[edit]

text: For older borrowers (typically in retirement), it may be possible to arrange a mortgage where neither the principal nor interest is repaid. The interest is rolled up with the principal, increasing the debt each year.

text: These arrangements are variously called reverse mortgages, lifetime mortgages or equity release mortgages (referring to home equity), depending on the country. The loans are typically not repaid until the borrowers are deceased, hence the age restriction.

text: Through the Federal Housing Administration, the U.S. government insures reverse mortgages via a program called the HECM (Home Equity Conversion Mortgage). Unlike standard mortgages (where the entire loan amount is typically disbursed at the time of loan closing) the HECM program allows the homeowner to receive funds in a variety of ways: as a one time lump sum payment; as a monthly tenure payment which continues until the borrower dies or moves out of the house permanently; as a monthly payment over a defined period of time; or as a credit line.[7]

text: For further details, see equity release.

text: Interest and partial principal[edit]

text: In the U.S. a partial amortization or balloon loan is one where the amount of monthly payments due are calculated (amortized) over a certain term, but the outstanding balance on the principal is due at some point short of that term. In the UK, a partial repayment mortgage is quite common, especially where the original mortgage was investment-backed.

text: Variations[edit]

text: Graduated payment mortgage loan have increasing costs over time and are geared to young borrowers who expect wage increases over time. Balloon payment mortgages have only partial amortization, meaning that amount of monthly payments due are calculated (amortized) over a certain term, but the outstanding principal balance is due at some point short of that term, and at the end of the term a balloon payment is due. When interest rates are high relative to the rate on an existing seller's loan, the buyer can consider assuming the seller's mortgage.[8] A wraparound mortgage is a form of seller financing that can make it easier for a seller to sell a property. A biweekly mortgage has payments made every two weeks instead of monthly.

text: Budget loans include taxes and insurance in the mortgage payment;[9] package loans add the costs of furnishings and other personal property to the mortgage. Buydown mortgages allow the seller or lender to pay something similar to points to reduce interest rate and encourage buyers.[10] Homeowners can also take out equity loans in which they receive cash for a mortgage debt on their house. Shared appreciation mortgages are a form of equity release. In the US, foreign nationals due to their unique situation face Foreign National mortgage conditions.

text: Flexible mortgages allow for more freedom by the borrower to skip payments or prepay. Offset mortgages allow deposits to be counted against the mortgage loan. In the UK there is also the endowment mortgage where the borrowers pay interest while the principal is paid with a life insurance policy.

text: Commercial mortgages typically have different interest rates, risks, and contracts than personal loans. Participation mortgages allow multiple investors to share in a loan. Builders may take out blanket loans which cover several properties at once. Bridge loans may be used as temporary financing pending a longer-term loan. Hard money loans provide financing in exchange for the mortgaging of real estate collateral.

text: Foreclosure and non-recourse lending[edit]

text: In most jurisdictions, a lender may foreclose the mortgaged property if certain conditions occur – principally, non-payment of the mortgage loan. Subject to local legal requirements, the property may then be sold. Any amounts received from the sale (net of costs) are applied to the original debt. In some jurisdictions, mortgage loans are non-recourse loans: if the funds recouped from sale of the mortgaged property are insufficient to cover the outstanding debt, the lender may not have recourse to the borrower after foreclosure. In other jurisdictions, the borrower remains responsible for any remaining debt.

text: In virtually all jurisdictions, specific procedures for foreclosure and sale of the mortgaged property apply, and may be tightly regulated by the relevant government. There are strict or judicial foreclosures and non-judicial foreclosures, also known as power of sale foreclosures. In some jurisdictions, foreclosure and sale can occur quite rapidly, while in others, foreclosure may take many months or even years. In many countries, the ability of lenders to foreclose is extremely limited, and mortgage market development has been notably slower.

text: National differences[edit]

text: A study issued by the UN Economic Commission for Europe compared German, US, and Danish mortgage systems. The German Bausparkassen have reported nominal interest rates of approximately 6 per cent per annum in the last 40 years (as of 2004). In addition, they charge administration and service fees (about 1.5 per cent of the loan amount). However, in the United States, the average interest rates for fixed-rate mortgages in the housing market started in the tens and twenties in the 1980s and have (as of 2004) reached about 6 per cent per annum. However, gross borrowing costs are substantially higher than the nominal interest rate and amounted for the last 30 years to 10.46 per cent. In Denmark, similar to the United States mortgage market, interest rates have fallen to 6 per cent per annum. A risk and administration fee amounts to 0.5 per cent of the outstanding debt. In addition, an acquisition fee is charged which amounts to one per cent of the principal.[11]

text: United States[edit]

text: The mortgage industry of the United States is a major financial sector. The federal government created several programs, or government sponsored entities, to foster mortgage lending, construction and encourage home ownership. These programs include the Government National Mortgage Association (known as Ginnie Mae), the Federal National Mortgage Association (known as Fannie Mae) and the Federal Home Loan Mortgage Corporation (known as Freddie Mac).[2]

text: The US mortgage sector has been the center of major financial crises over the last century. Unsound lending practices resulted in the National Mortgage Crisis of the 1930s, the savings and loan crisis of the 1980s and 1990s and the subprime mortgage crisis of 2007 which led to the 2010 foreclosure crisis.[2]

text: In the United States, the mortgage loan involves two separate documents: the mortgage note (a promissory note) and the security interest evidenced by the "mortgage" document; generally, the two are assigned together, but if they are split traditionally the holder of the note and not the mortgage has the right to foreclose.[12] For example, Fannie Mae promulgates a standard form contract Multistate Fixed-Rate Note 3200[13] and also separate security instrument mortgage forms which vary by state.[14]

text: Canada[edit]

text: In Canada, the Canada Mortgage and Housing Corporation (CMHC) is the country's national housing agency, providing mortgage loan insurance, mortgage-backed securities, housing policy and programs, and housing research to Canadians.[15] It was created by the federal government in 1946 to address the country's post-war housing shortage, and to help Canadians achieve their homeownership goals.

text: The most common mortgage in Canada is the five-year fixed-rate closed mortgage, as opposed to the U.S. where the most common type is the 30-year fixed-rate open mortgage.[16] Throughout the financial crisis and the ensuing recession, Canada’s mortgage market continued to function well, partly due to the residential mortgage market's policy framework, which includes an effective regulatory and supervisory regime that applies to most lenders. Since the crisis however, the low interest rate environment that as arisen has contributed to a significant increases in mortgage debt in the country.[17]

text: In April 2014, the Office of the Superintendent of Financial Institutions (OSFI) released guidelines for mortgage insurance providers aimed at tightening standards around underwriting and risk management. In a statement, the OSFI has stated that the guideline will “provide clarity about best practices in respect of residential mortgage insurance underwriting, which contribute to a stable financial system.” This comes after several years of federal government scrutiny over the CMHC, with former Finance Minister Jim Flaherty musing publicly as far back as 2012 about privatizing the Crown corporation.[18]

text: In an attempt to cool down the real estate prices in Canada, Ottawa introduced a mortgage stress test effective 17 October, 2016. Under the stress test every home buyer with less than 20% down payment (high ratio) undergo a test where borrowers affordability is judged based on mortgage rate of 4.64% with 25 years amortization if they want to get a mortgage from any federally regulated lender.This stress test has lowered the maximum mortgage approved amount by almost 20% for all borrowers in Canada. Maximum amortization on home mortgages has been reduced back to 30 years instead of 35.

text: United Kingdom[edit]

text: The mortgage industry of the United Kingdom has traditionally been dominated by building societies, but from the 1970s the share of the new mortgage loans market held by building societies has declined substantially. Between 1977 and 1987, the share fell from 96% to 66% while that of banks and other institutions rose from 3% to 36%. There are currently over 200 significant separate financial organizations supplying mortgage loans to house buyers in Britain. The major lenders include building societies, banks, specialized mortgage corporations, insurance companies, and pension funds.

text: In the UK variable-rate mortgages are more common than in the United States.[19][20] This is in part because mortgage loan financing relies less on fixed income securitized assets (such as mortgage-backed securities) than in the United States, Denmark, and Germany, and more on retail savings deposits like Australia and Spain.[19][20] Thus, lenders prefer variable-rate mortgages to fixed rate ones and whole-of-term fixed rate mortgages are generally not available. Nevertheless, in recent years fixing the rate of the mortgage for short periods has become popular and the initial two, three, five and, occasionally, ten years of a mortgage can be fixed.[21] From 2007 to the beginning of 2013 between 50% and 83% of new mortgages had initial periods fixed in this way.[22]

text: Home ownership rates are comparable to the United States, but overall default rates are lower.[19] Prepayment penalties during a fixed rate period are common, whilst the United States has discouraged their use.[19] Like other European countries and the rest of the world, but unlike most of the United States, mortgages loans are usually not nonrecourse debt, meaning debtors are liable for any loan deficiencies after foreclosure.[19][23]

text: The customer-facing aspects of the residential mortgage sector are regulated by the Financial Conduct Authority (FCA), and lenders' financial probity is overseen by a separate regulator, the Prudential Regulation Authority (PRA) which is part of the Bank of England. The FCA and PRA were established in 2013 with the aim of responding to criticism of regulatory failings highlighted by the financial crisis of 2007–2008 and its aftermath.[24][25][26]

text: Continental Europe[edit]

text: In most of Western Europe (except Denmark, the Netherlands and Germany), variable-rate mortgages are more common, unlike the fixed-rate mortgage common in the United States.[19][20] Much of Europe has home ownership rates comparable to the United States, but overall default rates are lower in Europe than in the United States.[19] Mortgage loan financing relies less on securitizing mortgages and more on formal government guarantees backed by covered bonds (such as the Pfandbriefe) and deposits, except Denmark and Germany where asset-backed securities are also common.[19][20] Prepayment penalties are still common, whilst the United States has discouraged their use.[19] Unlike much of the United States, mortgage loans are usually not nonrecourse debt.[19]

text: Within the European Union, covered bonds market volume (covered bonds outstanding) amounted to about EUR 2 trillion at year-end 2007 with Germany, Denmark, Spain, and France each having outstandings above 200,000 EUR million.[27] Pfandbrief-like securities have been introduced in more than 25 European countries—and in recent years also in the U.S. and other countries outside Europe—each with their own unique law and regulations.[11]

text: Recent trends[edit]

text: On July 28, 2008, US Treasury Secretary Henry Paulson announced that, along with four large U.S. banks, the Treasury would attempt to kick start a market for these securities in the United States, primarily to provide an alternative form of mortgage-backed securities.[28] Similarly, in the UK "the Government is inviting views on options for a UK framework to deliver more affordable long-term fixed-rate mortgages, including the lessons to be learned from international markets and institutions".[29]

text: George Soros's October 10, 2008 Wall Street Journal editorial promoted the Danish mortgage market model.[30]

text: Malaysia[edit]

text: Mortgages in Malaysia can be categorised into 2 different groups: conventional home loan and Islamic home loan. Under the conventional home loan, bank normally charges fixed interest rate or variable interest rate, or both.[31] These interest rates are tied to Base Rate (individual bank's benchmark rate).

text: For Islamic home financing, it follows the Sharia Law and comes in 2 common types: Bai’ Bithaman Ajil (BBA) or Musharakah Mutanaqisah (MM). Bai' Bithaman Ajil is when the bank buys the property at current market price and sells it back to you at a much higher price. Musharakah Mutanaqisah is when the bank buys the property together with you. You will then slowly buy the bank's portion of the property through rental (whereby a portion of the rental goes to paying for purchase of a part the bank's share in the property until the property comes to your complete ownership).

text: Islamic countries[edit]

text: Islamic Sharia law prohibits the payment or receipt of interest, meaning that Muslims cannot use conventional mortgages. However, real estate is far too expensive for most people to buy outright using cash: Islamic mortgages solve this problem by having the property change hands twice. In one variation, the bank will buy the house outright and then act as a landlord. The homebuyer, in addition to paying rent, will pay a contribution towards the purchase of the property. When the last payment is made, the property changes hands.[clarification needed]

text: Typically, this may lead to a higher final price for the buyers. This is because in some countries (such as the United Kingdom and India) there is a stamp duty which is a tax charged by the government on a change of ownership. Because ownership changes twice in an Islamic mortgage, a stamp tax may be charged twice. Many other jurisdictions have similar transaction taxes on change of ownership which may be levied. In the United Kingdom, the dual application of stamp duty in such transactions was removed in the Finance Act 2003 in order to facilitate Islamic mortgages.[32]

text: An alternative scheme involves the bank reselling the property according to an installment plan, at a price higher than the original price.

text: Both of these methods compensate the lender as if they were charging interest, but the loans are structured in a way that in name they are not, and the lender shares the financial risks involved in the transaction with the homebuyer.[citation needed]

text: Exception[edit]

text: Bali, Indonesia is an exception to the rule of most home purchase being funded by a mortgage. Instead, most properties there are paid with cash due to the lack of available mortgages.[33]

text: Mortgage insurance[edit]

text: Mortgage insurance is an insurance policy designed to protect the mortgagee (lender) from any default by the mortgagor (borrower). It is used commonly in loans with a loan-to-value ratio over 80%, and employed in the event of foreclosure and repossession.

text: This policy is typically paid for by the borrower as a component to final nominal (note) rate, or in one lump sum up front, or as a separate and itemized component of monthly mortgage payment. In the last case, mortgage insurance can be dropped when the lender informs the borrower, or its subsequent assigns, that the property has appreciated, the loan has been paid down, or any combination of both to relegate the loan-to-value under 80%.

text: In the event of repossession, banks, investors, etc. must resort to selling the property to recoup their original investment (the money lent), and are able to dispose of hard assets (such as real estate) more quickly by reductions in price. Therefore, the mortgage insurance acts as a hedge should the repossessing authority recover less than full and fair market value for any hard asset.


document_title: List of Hollywood Heights episodes

question_text: what episode of hollywood heights does eddie and chloe break up

root

text: List of Hollywood Heights episodes

text: Hollywood Heights is a Nick at Nite television drama series, that later moved to TeenNick. The show follows "the journey of a teenage girl whose life changes drastically when she becomes a star and wins the love of her rock and roll star and both are tested by setbacks, heartbreak and deception."[1] Following the Latin American telenovela format, Hollywood Heights aired every weeknight at 9 p.m. rather than airing weekly.[1][2] It aired 80 episodes over a single season.

tag: p

text: Episodes[edit]

text:
No. in
series
Title
Directed by
Written by
Original air date
U.S. viewers
(millions)

1
"Meeting a Rockstar"
Owen Renfroe
Sally Sussman, Brent Boyd, Lisa Seidman & Greg Schaffer
June 18, 2012 (2012-06-18)
0.558[3]

Rock star Eddie Duran and his girlfriend Chloe return to hometown LA for the last concert of his tour. Super-fan Loren and her best friend Melissa are able to talk their way into the show just as he hits the stage.
Note: This episode was available on the Nick at Nite website before its air date.

2
"Loren Catches Eddie's Attention"
Owen Renfroe
Catharina Ledeboer, Jed Seidel, Sally Sussman & Brent Boyd
June 19, 2012 (2012-06-19)
0.336[4]

During Eddie's performance, Loren is overjoyed when his eyes meet hers. After the show, she sends him some lyrics to a song she wrote via Twitter and catches his attention. Jake's wife stays up all night waiting for him to come. Eddie's father thinks about his deceased wife. Chloe spends time with Tyler discussing if he could become famous with Eddie's fame. Phil commits a heist with a guy named Ray. Loren sets Melissa straight.
Note: This episode was available on the Nick at Nite website before its television air date.

3
"Eddies's Songwriting Contest"
Cynthia J. Popp
Flint Wainess, Sally Sussman & Brent Boyd
June 20, 2012 (2012-06-20)
N/A

Eddie meets up with Tyler to talk to him, but the two just end up arguing about the past. Melissa tells Loren about Eddie’s songwriting contest – this is her big chance.
Note: This episode was available on the Nick at Nite website before its air date.

4
"Chloe's Secret"
Larry Carpenter
Valerie Ahern, Christian McLaughlin, Sally Sussman & Brent Boyd
June 21, 2012 (2012-06-21)
0.392[5]

When Loren's not happy, Melissa enters her song into the contest for her. Eddie comes dangerously close to uncovering a secret Chloe is hiding.
Note: This episode was available on the Nick at Nite website before its air date.

5
"Eddie Decides to Take the Next Step"
Owen Renfroe
Josh Griffith, Brent Boyd & Sally Sussman,
June 22, 2012 (2012-06-22)
N/A

Loren worries about her song entry, so Melissa and Nora work on lifting her spirits. Meanwhile, Eddie wants his relationship with Chloe to progress to the next level.
Note: This episode was available on the Nick at Nite website before its air date.

6
"Loren Makes the Top 25"
Cynthia J. Popp
Flint Wainess, Sally Sussman & Brent Boyd
June 25, 2012 (2012-06-25)
0.470[6]

Loren's song makes the top 25 in the contest; Chloe steals a photo from the press; Jake teaches Kelly about "the business."

7
"Loren Has to Make a Decision"
Larry Carpenter
Lisa Seidman, Brent Boyd & Sally Sussman
June 26, 2012 (2012-06-26)
0.649[7]

Loren's priorities shift after she's awarded a scholarship. Elsewhere, Eddie alludes to tying the knot while talking to the press.

8
"Max Questions Chloe"
Michael Eilbaum
Catharina Ledeboer, Christian McLaughlin, Sally Sussman & Brent Boyd
June 27, 2012 (2012-06-27)
N/A

Max grows distrustful of Chloe. Meanwhile, Tyler faces eviction; and Adriana uses Phil's help to cheat on an exam.

9
"Loren Doesn't Make the Cut"
Larry Carpenter
Lisa Seidman, Jed Seidel, Sally Sussman & Brent Boyd
June 28, 2012 (2012-06-28)
0.442[8]

Jake removes Loren's song from the list of finalists. Meanwhile, Loren plans to deliver her song to Eddie at the club opening.

10
"Eddie Questions His Feelings"
Noel Maxam
Josh Griffith, Greg Schaffer, Sally Sussman & Brent Boyd
June 29, 2012 (2012-06-29)
0.688[9]

Melissa and Loren get into the club, and Tyler kisses Chloe behind Eddie's back. Eddie sees a photo of Tyler leaving Chloe's place at 2:00 am, which may change his mind about Chloe and his previous plans to propose to her.

11
"Loren Gets Framed"
Noel Maxam
Josh Griffith, Valerie Ahern, Sally Sussman & Brent Boyd
July 2, 2012 (2012-07-02)
0.566[10]

Chloe tells Eddie the photo he found was altered. Elsewhere, Adriana and Phil plant incriminating evidence in Loren's locker.

12
"The Incriminating Photo"
Owen Renfroe
TBA
July 3, 2012 (2012-07-03)
0.497[11]

Eddie has a surprise for Chloe. Meanwhile, Loren faces a suspension unless she can prove she's not guilty.

13
"Loren's Proven Innocent"
Cynthia J. Popp
Flint Wainess, Sally Sussman & Brent Boyd
July 4, 2012 (2012-07-04)
0.434[12]

Chloe tells Eddie that Tyler's been stalking her to explain the photo. Loren is proven innocent at school but doesn't make the contest's top five.

14
"Chloe Finally Gets What She Wants"
Casey Childs
Lisa Seidman, Brent Boyd & Sally Sussman
July 5, 2012 (2012-07-05)
0.524[13]

After Loren’s eliminated from the contest, Nora’s boss Don helps get the song to Max in an attempt at a second chance. Chloe finally gets what she wants.

15
"Loren's Song"
Noel Maxam
Lisa Seidman, Jed Seidel, Sally Sussman & Brent Boyd
July 6, 2012 (2012-07-06)
0.681[14]

Nora gets Max to listen to Loren’s song. Max shares it with Eddie, and Loren just may get back into the contest!

16
"Loren's Stage Fright"
Casey Childs
Catharina Ledeboer, Valerie Ahern, Sally Sussman & Brent Boyd
July 9, 2012 (2012-07-09)
0.479[15]

Loren is added as a finalist in the competition; Eddie warns Tyler to stay away from Chloe.

17
"Dinner at the Tate's"
Michael Eilbaum
Flint Wainess, Sally Sussman & Brent Boyd
July 10, 2012 (2012-07-10)
0.343[16]

Max mourns Katy's death on their anniversary; Nora invites Don and Adriana over for dinner.

18
"The Announcement"
Hisham Abed
Lisa Seidman, Brent Boyd & Sally Sussman
July 11, 2012 (2012-07-11)
0.345[17]

Chloe and Eddie make an announcement; Loren prepares for the contest event.

19
"Loren Gets Lost"
Owen Renfroe
Lisa Seidman, Greg Schaffer, Sally Sussman & Brent Boyd
July 12, 2012 (2012-07-12)
0.320[18]

As the contest begins, Loren and her friends are lost and stranded across town.

20
"The Songwriting Contest"
Casey Childs
Josh Griffith, Jed Seidel, Brent Boyd & Sally Sussman
July 13, 2012 (2012-07-13)
0.449[19]

Loren finds her way to the club and takes the stage to perform; Chloe is shocked when she comes face to face with her mother,Jackie.

21
"A Winner Is Chosen"
Michael Eilbaum
Flint Wainess, Sally Sussman & Brent Boyd
July 16, 2012 (2012-07-16)
0.523[20]

Loren is able to perform after conquering her stage fright; Chloe tries to hide Jackie from Eddie.

22
"The Music Video Rehearsal"
Larry Carpenter
Catharina Ledeboer, Greg Schaffer, Sally Sussman & Brent Boyd
July 17, 2012 (2012-07-17)
0.433[21]

Loren arrives for Eddies's music video shoot; and finds out that she is going to star in the music video. Phil proves his loyalty to Colorado.

23
"Chloe's Jealousy"
Larry Carpenter
Lisa Seidman, Brent Boyd & Sally Sussman
July 18, 2012 (2012-07-18)
0.539[22]

Chloe tries to be a part of Eddie's music video; Tyler reveals his secret; Eddie and Loren grow closer. Chloe has some big secrets & Max is on her trail.

24
"Max Confronts Chloe"
Owen Renfroe
Lisa Seidman, Jed Seidel, Sally Sussman & Brent Boyd
July 19, 2012 (2012-07-19)
0.590[23]

Max confronts Chloe about the dirt he has on her. Phil gets questioned about a robbery.

25
"Lisa Reveals a Secret"
Owen Renfroe
Josh Griffith, Valerie Ahern, Sally Sussman & Brent Boyd
July 20, 2012 (2012-07-20)
0.694[24]

Loren considers her future; Chloe must come clean about her past; Lisa opens up to Melissa.

26
"Loren's Dilemma"
Casey Childs
Lisa Seidman, Valerie Ahern, Christian McLaughlin & Brent Boyd
July 23, 2012 (2012-07-23)
0.699[25]

Loren meets up with Eddie and makes a huge decision about her future; Eddie and Max clash over Chloe's lies.

27
"Eddie And Chloe Meet Oz"
Michael Eilbaum
Catharina Ledeboer & Brent Boyd
July 24, 2012 (2012-07-24)
0.812[26]

Eddie encourages Chloe to reconcile with Jackie; Eddie and Chloe meet with a movie producer. Guest Star: James Franco

28
"Melissa's Birthday"
Michael Eilbaum
Flint Wainess & Brent Boyd
July 25, 2012 (2012-07-25)
0.714[27]

Chloe creates a diversion when things escalate between Jake, Max, Tyler and Eddie; Loren and Melissa clash with Phil and Adriana, things escalate between Eddie and Chloe.

29
"Chloe Turns Diva"
Noel Maxam
Lisa Seidman, Jed Seidel & Brent Boyd
July 26, 2012 (2012-07-26)
0.933[28]

Chloe shows her true colors on the set of Eddies's music video; Loren invites Eddie to spend time with her. Max's private investigator snaps a picture of Chloe and Tyler kissing, proving an affair behind Eddie's back.

30
"Another Incriminating Photo"
Michael Eilbaum
Josh Griffith, Greg Schaffer & Brent Boyd
July 27, 2012 (2012-07-27)
0.660[29]

Loren asks Eddie to help celebrate Melissa's birthday; Chloe tells her mom about the accident. Max reveals what he has uncovered about Chloe, flying Eddie into a rage, and causing Max to call off the private investigator, leaving them without knowing Chloe's DMV records.

31
"Eddie Learns The Truth"
Hisham Abed
Lisa Seidman, Greg Schaffer & Brent Boyd
July 30, 2012 (2012-07-30)
0.579[30]

Chloe's incriminating photo angers Eddie, officially ending his relationship with her and calling off the engagement. Meanwhile, Loren is ecstatic after another business meeting with Kelly, but Nora questions whether it is too good to be true.

32
"The Video Shoot"
Noel Maxam
Flint Wainess & Brent Boyd
July 31, 2012 (2012-07-31)
0.742[31]

Eddie tries to put his personal issues aside while shooting his music video after breaking up with Chloe and Loren gets a new part in the video. While the video is being shot, Max takes his chance to talk to Kelly and find out if she really is a manager. Chloe tries to stop by and Lily oversteps a boundary in an interview with Loren. Things may heat up with Max and Nora.

33
"Chloe Tries To Reconcile"
Michael Eilbaum
Catharina Ledeboer & Brent Boyd
August 1, 2012 (2012-08-01)
0.780[32]

Chloe shows up at Eddies's apartment, desperate to make amends and date him again. Eddie invites Loren to his penthouse to work on some songs but Loren gets into an argument with Chloe. Ellie acts strange around the office and Don finally pays off his ex-employee/ affair. While Phil gets deeper into trouble with Colorado.

34
"The Collaboration"
Michael Eilbaum
Josh Griffith, Lisa Seidman, Jed Seidel & Brent Boyd
August 2, 2012 (2012-08-02)
0.851[33]

Loren and Eddie work on her song together but Jake doesn't think she has enough experience or talent which leads to an argument with Kelly and Jake. Chloe does a televised interview with Lily about her breakup with Eddie; Chloe tells Eddie, Tyler blackmailed her into having an affair with him. Phil gets deeper with Colorado and promises to hijack Don's clinic.

35
"The House Party"
Michael Eilbaum
Brent Boyd, Christian McLaughlin, Josh Griffith & Valerie Ahern
August 3, 2012 (2012-08-03)
0.717[34]

Loren has a house party when her mom is out of town with Dr. Masters and Melissa surprises Loren by inviting Eddie but not Cam; it backfires when both of them come and Cam becomes jealous of Eddie. Chloe follows Eddie to Loren's house party in the valley and sees Eddie and Loren goof around. Phil and Adriana get most of her father's things but not much else.

36
"The Paparazzi Photo"
Noel Maxam
Lisa Seidman, Valerie Ahern, Christina McLaughlin & Brent Boyd
August 6, 2012 (2012-08-06)
0.621[35]

The paparazzi release a photo of Eddie and Loren. Adriana heats up an argument with Melissa and Adam. Chloe takes Tyler with her to a meeting with Oz who has big plans for the both of them. Ian takes Eddie to Rumour for brunch and they bump into Tyler.

37
"Eddie's New Song"
Casey Childs
Catharina Ledeboar, Greg Schaffer & Brent Boyd
August 7, 2012 (2012-08-07)
0.747[36]

Eddie runs into Tyler at Rumour and confirms Chloe's story, giving her the perfect opportunity to talk to Eddie, but she blows it; Tyler comforts Chloe after Eddie rejects her. Eddie and Chloe have a spat about Tyler. Eddie visits Loren at work and plays her a new song of his. Meanwhile, Don and Nora cut their trip short when they hear about the break-in at the clinic.

38
"Eddie's Birthday"
Larry Carpenter
Flint Wainess & Brent Boyd
August 8, 2012 (2012-08-08)
0.659[37]

Eddie writes songs with Loren on his birthday and asks her if he should give Chloe another chance. Tyler is tired of playing by the rules of Chloe's game. Max is worried about Eddie's feelings for Loren and Nora doesn't want Eddie to lead Loren on. Traci is getting jealous of all the time Jake and Kelly spend together.

39
"The Double Date"
Casey Childs
Lisa Seidman, Jed Seidel & Brent Boyd
August 9, 2012 (2012-08-09)
0.691[38]

Max convinces Nora and Loren to join him for Eddie's birthday dinner at Rumour. Chloe's depression causes her to take 2 tranquilizers and get very drunk, interrupting the evening the Durans were having with the Tates. Gus and Lisa are more worried than ever about Phil.

40
"Their Special Place"
Casey Childs
Josh Griffith & Brent Boyd
August 10, 2012 (2012-08-10)
0.585[39]

Chloe taunts Loren at Rumor. Kelly moves out because she doesn't want things to get awkward between her, Jake, and Traci. Eddie takes Loren home, but on the way they stop at another one of his secret spots. When they get to Loren's house, they kiss. Jackie finds Chloe overdosed on pills passed out on her bedroom floor. Phil and Adriana talk about their future.

41
"Eddie Inspires Loren"
Owen Renfroe
Lisa Seidman, Jed Seidel & Brent Boyd
August 13, 2012 (2012-08-13)
N/A

Loren's absolutely elated and inspired after her night with Eddie, but then a picture goes public of Eddie and Chloe hugging in the hospital. Adriana and Phil's relationship may hit the rocks.
Note: As of this episode, the show has moved to weeknights on TeenNick at 8/7c.

42
"Eddie Explains Himself"
Owen Renfroe
Catharina Ledeboer, Greg Schaffer, & Brent Boyd
August 14, 2012 (2012-08-14)
N/A

Tyler's getting fed up with Chloe after realizing her hospital visit was just staged to bring Eddie back to her. Eddie and Loren meet up with Kelly then eat lunch only to be interrupted by Jackie begging for Eddie never to have any communication with Chloe. Loren shares her new song with Eddie and he responds by kissing Loren passionately on his piano bench. Jake and Traci take a day off work and have the day to themselves until interrupted by Kelly. Ellie blackmails Don with a sexual harassment charge to keep her job since Nora was not able to convince him not to fire Ellie.

43
"Loren's Recording Session"
Casey Childs
Flint Wainess & Brent Boyd
August 15, 2012 (2012-08-15)
N/A

Eddie wants to take things slow and not dive all in with Loren. Kelly arranges Loren's first session in the recording studio and Eddie 'gives' Loren the song she entered in the contest and plays the guitar when she is singing. Osborne and Connor come up with a scheme to make Eddie think they may give the role to Tyler if Eddie is not interested. Adam is accepted to NYU and Melissa may come with him in the fall. Don doesn't fire Ellie and tries to spend time with Nora. At the end Nora ends up seeing Eddie and Loren make out.

44
"Eddie Feels At Home"
Michael Eilbaum
Josh Griffith, Lisa Seidman, Valerie Ahern, Christian Mclaughlin & Brent Boyd
August 16, 2012 (2012-08-16)
N/A

Eddie joins Nora and Loren for a home cooked meal; Eddie learns more about Loren and takes her to MK. Adriana finds out she is pregnant and Gus has a chat with Phil. Ellie blackmails Don for $100,000.00 and Don puts together the money.

45
"Chloe and Oz"
Michael Eilbaum
Josh Griffith, Greg Schaffer & Brent Boyd
August 17, 2012 (2012-08-17)
N/A

Eddie and Loren stayed up all night talking and watching the sunrise. Chloe is determined to turn her life around; Chloe meets with Oz and they have dinner. Loren's online video receives a positive response mostly because of Eddie's tweet.Chloe and Osborne have a chat about Chloe's career. Traci goes into Jake's emails to find out what is going on but hits a dead end. Ellie hints to Don that the blackmailing won't end. Max invites Don and Nora to his club and Nora questions what is going on with herself.

46
"Jake's Concern"
Noel Maxam
Lisa Seidman, Greg Schaffer & Brent Boyd
August 20, 2012 (2012-08-20)
N/A

Eddie's new music troubles Jake but Eddie thinks that since the break-up he has grown and his fans will grow like him. Lisa suspects Adriana is pregnant and Gus makes a deal with Detective Conlee. Chloe ignores the fact that too much of the past may be uncovered in Oz's so called movie and goes to see Tyler. Chloe picks up Eddie's cell phone knowing it was Loren, telling her that Eddie's in the shower implying that they just slept together.

47
"Loren Deals with the Ex"
Casey Childs
Flint Wainess & Brent Boyd
August 21, 2012 (2012-08-21)
N/A

Eddie can't say no to Chloe's desperate plea for help, but is confused about his feelings for Chloe and Loren. At the end of a phone call, Loren accidentally said, "love you" to Eddie who was surprised and answered "back at ya". Traci and Tyler share some drinks and have a conversation that may lead too deep. Melissa calls Beth but chickens out confronting her. Adriana wants to keep the child and tests her father to see if he will help. Nora and Don talk about her future and possibly moving up. Kelly gives Jake an idea about testing Eddie's new material at MK in front of some of his fans and Loren being the opening act, but Nora isn't so sure about the idea.

48
"Eddie Takes Off"
Casey Childs
Catharina Ledeboer, Valerie Ahern, Christian McLaughlin & Brent Boyd
August 22, 2012 (2012-08-22)
N/A

Jake and Eddie talk about doing a small concert at MK to see if his fans like his new material. Chloe sets up a meeting not knowing that Eddie is heading out of town then is unsuccessful in finding out where. Eddie, in need of some alone time, takes off to Max's secluded beach bungalow. Max tells Loren, after the meeting that Kelly set up at MK, where Eddie is going and that Loren should go there and keep Eddie company. Nora tells Loren the discussion she had with Don about being partners. Colorado doesn't like being confronted by Detective Conlee and Gus, and puts the pressure on Phil. Loren shows up at Max's beach Bungalow.

49
"The Beach Bungalow"
Noel Maxam
Lisa Seidman, Jed Seidel & Brent Boyd
August 23, 2012 (2012-08-23)
N/A

Eddie at first is cold towards Loren but then he opens up and tells her he can't trust his feeling at this point. Don tries to pressure Nora into agreeing to the plan but Nora isn't comfortable with it. Max and Kelly have a chat about Eddie and Loren's relationship friendship/romance with Chloe eavesdroping. Chloe then drops by Jake's and manipulates Traci saying there may be an affair behind Traci's back. Eddie and Loren talk about their relationship and end up kissing on the couch. Tyler makes a call to Conner about things he may not know about Chloe.

50
"Nora Visits Max"
Michael Eilbaum
Josh Griffith, Greg Schaffer & Brent Boyd
August 24, 2012 (2012-08-24)
N/A

Loren and Eddie enjoy their alone time at the bungalow, and enjoy each other's company. Chloe finds out Loren is staying with Eddie and goes to Adriana to try to sabotage her. Phil decides to move out but is surprised to find Gus at his door, stabbed. Don is getting suspicious of Adriana. Tyler tries to convince Connor to put him in the movie, but is still left without an answer. Lisa blows up when finding out Melissa wants to find out about Beth. Max and Nora spend time at his club talking.

51
"Eddie's Inspired"
Casey Childs
Lisa Seidman, Jed Seidel & Brent Boyd
August 27, 2012 (2012-08-27)
N/A

Eddie and Loren don't hook up but they spend time together then go back to the city. When Eddie comes back he begins to write more music. Melissa and Adam sneak out to meet her Aunt Beth but when they meet Beth acts strange and spacy . Melissa then finds out that her dad's in the hospital. Phil doesn't tell Lisa who actually hurt Gus and is being pressured by Colorado to steal the meds. Nora and Loren have one of their mother-daughter chats.

52
"Eddie Helps Chloe"
Michael Eilbaum
Catharina Ledeboer, Greg Schaffer, & Brent Boyd
August 28, 2012 (2012-08-28)
N/A

After one final plea from Chloe, Eddie agrees to do Oz's movie but then finds Tyler coming out of Oz's office. Lisa talks with Adriana about her and Phil. Phil and Gus have a father-son talk about what should happen next. Kelly decides to give Loren a new makeover even though Eddie doesn't want her to change. Jake warns Eddie about Chloe. Tyler tries to convince Jackie into talking Chloe into moving back to Fresno. Tyler threatens to bring down Chloe. Don may have screwed Nora over to fix his expenses.

53
"Loren's New Look"
Casey Childs
Flint Wainess & Brent Boyd
August 29, 2012 (2012-08-29)
N/A

Loren does a photo shoot, and Nora is not too fond of her look. Eddie meets with Oz, and makes an arrangement that Loren joins the movie. Oz gets arrested. Traci is still suspicious of Kelly and Jake. Melissa is determined to find out more answers about Beth. Chloe forces Jackie out of the house, and threatens her, once again, to watch her back. Tyler comes to Rumour and makes drama with Loren and Eddie. Don and Nora talk business, and Nora goes home. Eddie gets asked by a fan for a picture but the fan recognizes Loren and wants Loren in the picture. Loren then takes a picture of Eddie and the fan and Eddie knows Loren is truly down to earth. Adriana and Chloe talk business, and Adriana is worried about what Chloe will do with her information about Loren.

54
"Loren's Debut"
Casey Childs
Josh Griffith, Valerie Ahern, Christian McLaughlin & Brent Boyd
August 30, 2012 (2012-08-30)
N/A

Eddie and Loren prepare for their upcoming concert at MK Club. Loren gets a call from Melissa saying that her life could be changed and to meet her at Loren's house ASAP! Tyler is more serious than ever to expose Chloe! Loren and Eddie hang out and Eddie saying that he is ready to start dating again. Jackie is going to leave to Fresno in the morning and she wants to tell Chloe something before shes leaves about Tyler. Melissa finds out that Beth is her mom and Lisa is her aunt.

55
"Eddie's New Sound"
Casey Childs
Josh Griffith & Brent Boyd
August 31, 2012 (2012-08-31)
N/A

Eddie plays some of his new material for Ian and Ian's thoughts sound like Jake's opinion that it will be a huge change. Melissa has a talk with Gus and Lisa about how she got there then spends the night at Loren's. Loren gets a text from her admirer but when she shows it to Nora it spaces Nora out because she suspects it's her dad. Max plays some songs for Nora but then afterward they hookup. Nora tells Loren about her hookup with Max and Loren takes it well. Phil calls Detective Conlee then later Colorado chokes Phil and says Phil will be doing the job for free. Jake and Traci talk about their relationship compared to Jake and Kellys'.

56
"Tyler Collects Evidence"
Casey Childs
Catharina Ledeboer & Brent Boyd
September 3, 2012 (2012-09-03)
N/A

Everyone starts to get ready for the concert, as Loren receives another mysterious text and tells Nora which leaves Nora with a mysterious look on her face. Ellie looks at Nora's phone and sees Max has called her a bunch and tells Nora right in front of Don leaving Don suspicious. Chloe gets the list from Adriana. Don sees Max and Nora laughing and looks sort of mad. Chloe goes on her date with Dylan and decides to go to MK with Dylan to make Eddie jealous. Melissa finds out about Lisa and Gus's lie and talks to Loren. Jackie leaves Chloe's and goes and talks to Tyler. Tyler bumps into Traci at the cafe after her talk with Kelly, Kelly introduces Loren to everyone. Phil talks to the detective guy.

57
"If There Was No Music"
Micheal Eilbaum
Flint Wainess & Brent Boyd
September 4, 2012 (2012-09-04)
N/A

At the concert, Eddie surprises Loren by pulling her on stage to perform with him and then plays some of his new music. Lisa gets a visit from Beth. Melissa finds that Beth had come for a visit. Loren talks to the record labels with Kelly. Kelly tells Jake how she really feels about him. Tyler tells Lily about the car accident with Max and Katy Duran. Lily stops by Chloe's to tell her what she just found out. Nora breaks off her relationship with Don for good and she tells Max. Max is happy that they broke up because he likes Nora. Max and Nora kiss. Chloe goes to the club to watch Eddie's performance. she goes with Dylan to make Eddie jealous.

58
"Mixed Reactions"
Michael Eilbaum
Lisa Seidman, Greg Schaffer & Brent Boyd
September 5, 2012 (2012-09-05)
N/A

Loren's Spring Break ends. Chloe goes to Tyler's house to plead him to keep their secret but Tyler is determined to see Chloe go down. Eddie's upset his fans don't approve of his new style. Jake gives Kelly a week to get on her own feet and leave his company. Melissa shows Beth pictures of her childhood which leads to Beth admitting that she made the right decision to leave her with Lisa and Gus, then Beth runs out the door. Adam tells Loren he might be falling in love with Melissa. Tyler also threatens Chloe by telling her he's gonna go tell Eddie personally that Chloe killed his mother.

59
"Tyler Blackmails Chloe"
Casey Childs
Lisa Seidman, Jed Seidel & Brent Boyd
September 6, 2012 (2012-09-06)
N/A

Tyler makes a proposition to Chloe that if she moves back to Fresno he will shut Lily up. Elsewhere, Melissa tries to face things she's uncovered about her past when Beth sends a box full of stuff from New York. Eddie finds out about most of Kelly and Jake's issues and worries about Kelly changing Loren. Eddie picks up Loren from school and they have a talk about Kelly. Kelly reveals that Jake never wanted her to sign Loren. Eddie receives a mysterious call from Lily Parks. Nora and Max have lunch at his club. Ellie continues to manipulate Don's mind. Phil and Adriana worry about their future.

60
"Loren Has Doubts"
Michael Eilbaum
Josh Griffith, Valerie Ahern, Christian McLaughlin & Brent Boyd
September 7, 2012 (2012-09-07)
N/A

Eddie is disturbed by a mysterious phone call from Lily; Loren questions her professional relationship with Kelly because Eddie asked her to join Jake's company, which leads to a big argument between Kelly and Eddie. Melissa wants to move out with Loren who is against the idea. Nora thinks Loren's dad is the mysterious person who sends the text. Phil tries to make things right. Don finds out about Adriana. Eddie has a flashback, and Lily is on Tyler's side.

61
"The Mystery Texter"
Larry Carpenter
Josh Griffith, Brent Boyd & Flint Wainess
September 10, 2012 (2012-09-10)
N/A

Nora tells Loren the mystery texter is her father, and Loren is confused whether she should contact him or try to find more information about him. Ellie threatens Don to give her the money, so Don goes to Colorado to sell the drugs. Adriana is suspicious of him, and follows him. Mel is suspicious of Phil. Phil tries to save Adriana from getting into trouble. Chloe gets back at Tyler and finds out his hiding place of evidence. Eddie and Lily talk about things, and Eddie isn't sure whether he wants to keep finding out about his mother.

62
"Loren Talks Business"
Casey Childs
Catharina Ledeboer, Valerie Ahern, Christian McLaughlin & Brent Boyd
September 11, 2012 (2012-09-11)
N/A

Loren has a dream about her dad but can't see his face and she chokes up on stage. Eddie is concerned about Loren's meeting with a music producer since the producer wants to change Loren's image and Kelly wants someone else to write Loren's songs. Phil's dealings with Colorado comes to an end. Eddie wants to meet up with Lily at Rumor because they can talk about the death of Katy Duran and who killed her. Chloe calls Lily and Lily wants to meet up with Chloe at Rumor. Lily sets up a meeting at Rumor with both Eddie and Chloe, and of course the exes do not know that Lily did this. Traci and Kelly have a talk about them being friends again. Nora quits her job since she doesn't know what's at stake with her job and Don's decision.

63
"The Text Spoof"
Casey Childs
Lisa Seidman, Jed Seidel & Brent Boyd
September 12, 2012 (2012-09-12)
N/A

Chloe sabotages Loren by sending out a fake text. Eddie clashes with Kelly about Loren's career, and Loren tells him to back off. Tyler back-lashes Chloe and tells her to leave to Fresno. Melissa records something shocking about Kelly. Phil tells Don the truth about how Adriana feels about him. Gus and Lisa are happy to finally have peace. Eddie meets with Lily but it takes a huge downfall when Chloe and Tyler show up. Chloe confronts Eddie but gets caught up when she mentions the accident. Don hits on Ellie, attempting to change her opinion about the money, but she isn't budging. Dylan is still being annoying with Chloe. Phil tells Adriana he wants to have the baby. Eddie finds out Chloe committed a crime.

64
"Eddie Demands Answers"
Owen Renfroe
Josh Griffith, Greg Schaffer & Brent Boyd
September 13, 2012 (2012-09-13)
N/A

When Eddie demands answers, Chloe tells him everything, but lies about driving the car that ran Katy and Max off the road, and tells Eddie that Tyler was the one driving. Chloe is in Max's apartment, on the balcony, and Dylan, drunk, comes in and accidentally pushed her off the side. Eddie and Tyler fight, Tyler reminds Eddie that he was too drunk to drive that night, and tells him that Chloe was the one driving and Eddie storms off, leaving his phone at the MK club. Nora and Max have evening together, where Max offers Nora a job, only to find out about the 'text smear'. Phil wants to settle down with Adriana and the baby, but Adriana doesn't want to have the baby. Lisa suspects Adriana is pregnant, and talks to Phil about it, where he confirms her suspicions. He asks Gus and Lisa what he should do, and they tell him that they will be on his side, no matter what his and Adriana's decision is. Phil leaves dinner and tells Gus that he will take his job offer. Adriana and Don have a 'daughter-father' talk, Don tells Adriana that they might have to move to Miami, Adriana says that she is an adult, and can stay in LA if she wants to, and they agree that Adriana is too young to have a baby. Traci tells Jake that she wants a break from the married life, and when he tries to talk her out of it, she storms off.

65
"Missing"
Owen Renfroe
Josh Griffith, Greg Schaffer & Brent Boyd
September 14, 2012 (2012-09-14)
N/A

Loren grows increasingly worried about not hearing from Eddie and begins to fear that something bad has happened to him. Max and Tyler discover Chloe after she fell off Max's terrace and have her transported to the hospital. Max and Jake search Eddie's apartment but do not find him. Max then asks Loren if there is any place where Eddie might go to think and she takes him to their spot in Ojai. Eddie stops for gas at a gas station and runs across a fan who compliments his car and asks for an autograph. Max receives a call from the police after they discover Eddie's car slid off the road and totaled. The driver of the car is found dead.

66
"Bad News Travels Fast"
Casey Childs
Josh Griffith, Lisa Seidman, Greg Schaffer & Brent Boyd
September 17, 2012 (2012-09-17)
N/A

The news of Eddie's accident reaches his loved ones;after Chloe's fall she ends up in the hospital in acoma. Tyler feels guilty about his part in Chloe's situation, but points the finger towards Eddie when questioned by a police detective. Lily interrogates Tyler about Chloe. Max is requested to view the accident scene. The police want to know, if he is able to identify anything. Max identifies Eddies wallet and has a small breakdown at the police station after being asked to provide a DNA sample of Eddies, so the body can be identified. Loren is in denial, she hopes Eddie took off to spend some time alone. After an intense dream about Eddie, she starts to accept that Eddie may not come back. She is devastated, but Melissa and her mom stay on her side for support. Kelly's first thought after the news "hopefully Loren will keep in line and not throw away her career" Jake goes to see Max, but both are too hurt by the news to be of any help for each other.

67
"Max Looks For Answers"
Larry Carpenter
Flint Waisness & Brent Boyd
September 18, 2012 (2012-09-18)
N/A

Mel wants Loren to talk through it. Nora comforts Max. Kelly comforts Jake as they talk about Eddie and how Loren still thinks he's alive. Jake gets out the alcohol. Phil catches up with his old friend, Ray and seems like he's getting out of the business for good. Don's in deep trouble. Adriana's having a nightmare. Mel wakes up to an absent Loren who went to Eddie's apartment. Jake and Kelly sleep together. Loren runs into Max in Eddie's apartment. Adriana talks to Phil about how she doesn't want to move in with him anymore. Nora goes to Eddie's to see Loren. They leave and Max leaves Loren with comforting words. Phil concedes to Adriana's demands for a nice house. Steven walks in on a depressed Kelly. She tells him she slept with Jake. Adriana and Phil find out about Eddie's accident. Adriana tells Don she's not going to Miami with him.

68
"Seeing a Ghost"
Owen Renfroe
Lisa Seidman, Valerie Ahern, Christian McLaughlin & Brent Boyd
September 19, 2012 (2012-09-19)
N/A

Loren has several episodes at school in which she has visions of Eddie across the room, but then he disappears. She overhears Cam tell Adriana's friend, Kim how rude she is being when she speculates if Eddie left Loren his fortune in his will. Mel tells Loren she should go home from school but instead Loren wants to go to Eddie's and her special spot at Griffith Park where Loren breaks down and cries . Loren agrees with Kelly to go back to the studio and record an album, but Nora thinks Loren needs to deal with her feelings first. Max goes to Eddie's to get a DNA sample to verify that it was Eddie in the car that crashed. Jake decides to stay at a hotel and Traci will stay at their house. Traci thinks it's too late to repair their marriage. Chloe moves her fingers, although no one is there to see. Eddie is seen with his eyes closed in a bed in a rustic shack where a young man and woman discuss that his condition has not changed.

69
"Waking Up"
Michael Eilbaum
Josh Griffith & Brent Boyd
September 20, 2012 (2012-09-20)
N/A

Loren runs into problems in the recording studio, but Jake helps her out of it; Chloe makes progress, and wakes up; Tyler tries to convince her that Eddie tried to kill her; Jackie plans on rushing Chloe to Fresno after she is better; Kelly flirts with Jake and tries to play games with him; Don is very close to paying back Ellie; Eddie wakes up and is very confused and wants to escape; Mel makes a montage for Loren; Adriana starts looking for apartments to live, but Phil isn't so sure; Phil's first day at work is a disaster in his point of view, but not in Gus's.

70
"A Strange Call"
Michael Eilbaum
Josh Griffith, Jed Seidel & Brent Boyd
September 21, 2012 (2012-09-21)
N/A

Max receives a call from Jeremy saying Eddie is alive, and decides to leave to Ojai with Nora to find out the truth. Loren decides to have her first solo concert. Phil hates his new job, but Adriana wants him to keep it so they can make money. Jackie tells Lily she should stop snooping through others' business. Tyler tries to convince Chloe that Eddie pushed her off and he died, but Chloe is in denial. Lisa warns Mel that making a video for Loren might make her feel more down.

71
"Max and Nora Go to Ojai"
Casey Childs
Lisa Seidman, Jed Seidel & Brent Boyd
September 24, 2012 (2012-09-24)
N/A

Max and Nora search an Ojai gas station for clues; Tyler urges Chloe to tell the detective that Eddie was responsible for her accident; Max threatens Tyler to stop throwing the blame on Eddie; Ellie files a lawsuit against Don, and he promises to give her the money right then and there; Mel gets a call from a famous TV producer, and is offered a job; Phil and Adriana's relationship is slowly slipping; Phil quits his job, and Gus is worried; Chloe is convinced that Eddie did not push her, and thinks Dylan did; Lia and Jeremy sing Eddie's song, but Eddie tells them to stop; Lisa gives Mel a letter from Beth, and Mel decides she's going to forget about Beth; Phil is up for a new raid with Ray; Nora comes to the office to drop off a few things, when she smells a gas leak.

72
"Loren and Kelly Clash"
Michael Eilbaum
Flint Wainess & Brent Boyd
September 25, 2012 (2012-09-25)
N/A

Loren and Kelly disagree about Loren singing songs written by someone else; Nora goes to the clinic and finds Don there too. When Don tries to get out of the clinic, it explodes with him inside. Firefighters search the clinic and they find that Don is dead. Traci tells Jake that she is pregnant, but she is still not sure about her relationship with Jake. Max tries to piece together why Eddie was angry the night he disappeared, and remembers when Eddie talked to Lily about his mom's death. Lily reveals that Tyler accused Chloe of killing Katy.

73
"A Message for Loren"
Hisham Abed
Lisa Seidman, Valerie Ahern, Christian McLaughlin & Brent Boyd
September 26, 2012 (2012-09-26)
N/A

Loren plans to play a new song at the memorial concert; Adriana is in denial about Don's accident; Phil and Ray head off to do their new gig, but he is stuck when he has to comfort Adriana; Ellie is still convinced that Don tried to murder her; Eddie's stubbornness increases when he asks Lia to send a message to Loren.

74
"Escape"
Casey Childs
Lisa Seidman, Valerie Ahern, Christian McLaughlin & Brent Boyd
September 27, 2012 (2012-09-27)
N/A

Loren does an interview from Eddie's apartment; Eddie sees Loren on TV and decides to make a break for it; Max receives some promising news; Phil defends his innocence; Chloe is confused about if she should leave or not; Adriana refuses to believe Don tried to frame Phil; Loren and Mel attempt to make peace with Adriana.

75
"Loren Learns the Truth"
Owen Renfroe
Flint Wainess & Brent Boyd
September 28, 2012 (2012-09-28)
N/A

Loren learns that Eddie is still alive; Chloe tries to remember what happened the night of her fall; Loren learns what Kelly really wants out of her, and they both clash; Max tries to figure out what happened to Eddie; Phil tries to find an alibi, and Adriana tries to stop him; Eddie's escape attempt hits a snag; Ellie tells an investigator about everything.

76
"Loren Confronts Chloe"
Casey Childs
Josh Griffith, Jed Seidel & Brent Boyd
October 1, 2012 (2012-10-01)
N/A

Loren tries to get Chloe to admit the truth about her accident, but eventually fails. Max proposes a deal with Chloe; she has one hour to drop Eddie's charges or he will make sure that the death of his wife is blamed on Chloe. Eddie decides it’s time to move on. Traci and Kelly clash about Jake. Phil catches Ellie fishing through Don's desk. When asked, Chloe points fingers at Eddie, but remembers Dylan pushed her. Adriana tells Conlee that Phil is staying at her house. Mel and Adam take their relationship to the next level. Lia kisses Eddie after driving him to a hotel in Los Angeles.

77
"Jetsetter"
Casey Childs
Josh Griffith, Greg Schaffer & Brent Boyd
October 2, 2012 (2012-10-02)
N/A

Kelly delivers some exciting news about Loren’s upcoming gig. Eddie sneaks out to send Loren an anonymous message, and is caught by someone. Jackie and Tyler convince Chloe to move back to Fresno. Max is determined to take down Chloe. Mel feels her friendship with Loren is changing. Adriana is worried when she is being accused of possible murder. Lisa and Gus hire a lawyer for Phil. Jake moves back in, and Kelly tries to stir up more trouble. Adam is thinking about staying in Los Angeles to be with Melissa.

78
"Fresno"
Michael Eilbaum
Josh Griffith, Greg Schaffer & Brent Boyd
October 3, 2012 (2012-10-03)
N/A

Max urges Loren to put her worry for Eddie aside and enjoy her big moment. Tyler and Chloe get an unexpected guest in Fresno, Eddie. Eddie wants Chloe to tell the police the truth, that he didn't push her but Tyler demands that it was true and for him to leave. Chloe says she'll do it if he breaks up with Loren. He decides to decline and accuses her of not knowing what it's like to be in love, which is of course, true. Chloe has horrible memories of her childhood in Fresno, and begins to think she is a terrible person. Traci finds out she isn't pregnant, and she never was. Nora and Lisa clash about how to raise a child. Phil holds a grudge against Adriana for turning him into the police.

79
"An Unexpected Guest"
Owen Renfroe
Josh Griffith & Brent Boyd
October 4, 2012 (2012-10-04)
N/A

While Loren’s getting ready for the concert, she comes face to face with her dad for the first time in 14 years. Eddie confronts Chloe and Tyler and threatens to expose their secret unless she drops the charges against Eddie. Traci decides that her marriage with Jake will not work, and decides to take the job in Chicago. Eddie becomes determined to get into Loren's concert.

80
"The Final Concert"
Owen Renfroe
Josh Griffith & Brent Boyd
October 5, 2012 (2012-10-05)
N/A

Loren senses Eddie at her concert and makes a quick change to her set list. Eddie does his best to avoid being caught by the cops. Eddie meets Loren at their spot at Griffith Park and Eddie tells Loren he loves her. They kiss, then Eddie gets arrested. Chloe tells police she wants to drop all the charges against Eddie. Max asks Nora to move in with him. Tyler takes a job with Osborne Silver. Chloe confronts Tyler about leaving her in Fresno. Tyler rejects Chloe, she is broken-hearted. The police find Ellie, and she confesses to hitting Don with the flashlight and leaving him in the clinic. All of Phil's charges are dropped. Phil proposes to Adriana. Lia goes to Jake's office and Lia and her brother get everything they wanted. Eddie meets Loren at his apartment. Loren, Eddie, Kelly, Jake, Max, and Nora all get on a private jet to head to the music festival in New York. The episode ends with Eddie and Loren kissing, and the private jet flying away.

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