Debt Consolidation - Loans
& Credit Card Bill - Debt Consolidation
Glossary of Mortgage Terms
Adjustable rate mortgage
A mortgage with an interest rate that is periodically adjusted based on a specified index. Also often referred to as an ARM.
Application fee
Application fees are paid at the time you apply for a mortgage and include the cost for property appraisal and credit report.
Appraised value
The market value of the home as determined by an appraiser for a specific date. Most lenders require an appraisal completed by a licensed appraiser before they’ll approve a mortgage.
APR
Annual Percentage Rate is the rate of interest expressed as an annualized figure, expressed as a percentage.
Assessed value
The value of a property for tax purposes. The assessed value is the amount on which property taxes will be based.
Assumable mortgage
A mortgage that may be taken over by another party that is approved by the lender.
Balloon mortgage
A mortgage in which monthly payments are made for a specified number of years. At the end of the payment period, the remaining amount of the mortgage is due in full.
Buyer’s agent
A real estate agent or realtor that acts for the buyer in a real estate transaction.
Closing costs
Fees paid by borrowers and sellers at the closing of a mortgage loan. These usually include loan fees, attorney fees, title insurance, points, survey, taxes and escrow fees.
Commission
The percentage of the final sale cost that is paid to the real estate agent or agents upon the sale of a house.
Down Payment
The amount of money that is paid by the buyer of a house that is not financed by a mortgage.
Fixed rate mortgage
A mortgage with a rate of interest that does not adjust based on an index. The interest rate and monthly payment are fixed for the life of the loan.
FSBO
For sale by owner. Pronounced fizbo. FSBO properties often carry incentives for purchase.
Interest
The fee that you pay for borrowing money, expressed as a percentage.
Interest-only mortgage
A mortgage where the borrower only repays the interest on the amount borrowed throughout the term of the loan. The total amount borrowed is due at the end of the term of the mortgage, and is often paid through an investment of some sort.
Jumbo mortgage
Mortgages for greater than the amount of a conforming loan. The current limit for a conforming loan is $240,000.
LTV (Loan-to-Value) ratio
The LTV will often determine whether or not the buyer must provide private mortgage insurance. It is found by dividing the loan amount by the appraised value of the property.
Mortgage
A loan taken out to purchase a home or other property. It is generally secured by using the property as collateral.
PMI (private mortgage insurance)
Insurance purchased by the borrower to repay the amount of the loan if the borrower should default under certain conditions.
Points
An amount paid to lower or maintain an interest rate. Each point is equal to 1% of the mortgage amount and usually lowers the interest rate by .25%.
Principal
The amount of a loan balance that is comprised of the original amount borrowed.
Reverse mortgage
A borrowing option where a bank or lender makes monthly payments to a homeowner for a specified period of time, and is paid in full when the home is sold.
Seller’s agent
A real estate agent who acts for the seller in a real estate transaction
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Debt Consolidation - Loans & Credit Card Bill - Debt Consolidation
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Monday, March 24, 2008
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