Saturday, March 18, 2006
A -B Acceleration (Mortgage) - Blanket Mortgage
Acceleration (Mortgage)
The right of the mortgagee (lender) to demand the immediate repayment of the mortgage loan balance upon the default of the mortgagor (borrower), or by using the right vested in the Due-on-Sale Clause.
Adjustable rate mortgage (ARM)
Is a mortgage in which the interest rate is adjusted periodically based on a pre-selected index. Also sometimes known as the re negotiable rate mortgage or variable rate mortgage.
Adjustment interval
On an adjustable rate mortgage, the time between changes in the interest rate and/or monthly payment, typically one, three or five years, depending on the index.
Amortization
Means loan payment by equal periodic payment calculated to pay off the debt at the end of a fixed period, including accrued interest on the outstanding balance.
Annual percentage rate (A.P.R.)
Is a interest rate reflecting the cost of a mortgage as a yearly rate. This rate is likely to be higher than the stated note rate or advertised rate on the mortgage, because it takes into account point and other credit cost. the APR allows home buyers to compare different types of mortgages based on the annual cost for each loan.
Appraisal
An estimate of the value of property, made by a qualified professional called an "appraiser".
Assessment
A local tax levied against a property for a specific purpose, such as a sewer or street lights.
Assumption
The agreement between buyer and seller where the buyer takes over the payments on an existing mortgage from the seller. Assuming a loan can usually save the buyer money since this is an existing mortgage debt, unlike a new mortgage where closing cost and new, probably higher, market-rate interest charges will apply.
Balloon (payment) mortgage
Usually a short-term fixed-rate loan which involves small payments for a certain period of time and one large payment for the remaining amount of the principal at a time specified in the contract.
Blanket Mortgage
A mortgage covering at least two pieces of real estate as security for the same mortgage.
The right of the mortgagee (lender) to demand the immediate repayment of the mortgage loan balance upon the default of the mortgagor (borrower), or by using the right vested in the Due-on-Sale Clause.
Adjustable rate mortgage (ARM)
Is a mortgage in which the interest rate is adjusted periodically based on a pre-selected index. Also sometimes known as the re negotiable rate mortgage or variable rate mortgage.
Adjustment interval
On an adjustable rate mortgage, the time between changes in the interest rate and/or monthly payment, typically one, three or five years, depending on the index.
Amortization
Means loan payment by equal periodic payment calculated to pay off the debt at the end of a fixed period, including accrued interest on the outstanding balance.
Annual percentage rate (A.P.R.)
Is a interest rate reflecting the cost of a mortgage as a yearly rate. This rate is likely to be higher than the stated note rate or advertised rate on the mortgage, because it takes into account point and other credit cost. the APR allows home buyers to compare different types of mortgages based on the annual cost for each loan.
Appraisal
An estimate of the value of property, made by a qualified professional called an "appraiser".
Assessment
A local tax levied against a property for a specific purpose, such as a sewer or street lights.
Assumption
The agreement between buyer and seller where the buyer takes over the payments on an existing mortgage from the seller. Assuming a loan can usually save the buyer money since this is an existing mortgage debt, unlike a new mortgage where closing cost and new, probably higher, market-rate interest charges will apply.
Balloon (payment) mortgage
Usually a short-term fixed-rate loan which involves small payments for a certain period of time and one large payment for the remaining amount of the principal at a time specified in the contract.
Blanket Mortgage
A mortgage covering at least two pieces of real estate as security for the same mortgage.
Comments:
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Balloon mortgage payments are usually short term with a five to seven year term. Are they risky? What isn't? But keep in mind that the final payment is going to be greater then those made during the term.
Paying a balloon payment by refinancing
If you plan to pay off a balloon loan by refinancing do it while rates are reasonably low. Waiting until the last minute can be a problem. Interest rates fluctuate and the future of current low level rates are uncertain.
Paying a balloon payment by refinancing
If you plan to pay off a balloon loan by refinancing do it while rates are reasonably low. Waiting until the last minute can be a problem. Interest rates fluctuate and the future of current low level rates are uncertain.
Balloon loans are a tricky thing. Therefore you want to know exactly what you are getting into. that have some features of a 30-year fixed-rate mortgage
payments are calculated in exactly the same way.
The interest rate on balloon loans is generally lower than 30 or 15-year fixed-rate mortgage resulting in much lower monthly payments.
The challenge lies in what happends at the end of the loan term. There is one large payment (the balloon payment) due upon maturity. This payment can be a troublesome payoff.
That said use a balloon payment calculator to undestand exactly what will be expected at the end of the term and if you can indeed afford this type of loan program.
payments are calculated in exactly the same way.
The interest rate on balloon loans is generally lower than 30 or 15-year fixed-rate mortgage resulting in much lower monthly payments.
The challenge lies in what happends at the end of the loan term. There is one large payment (the balloon payment) due upon maturity. This payment can be a troublesome payoff.
That said use a balloon payment calculator to undestand exactly what will be expected at the end of the term and if you can indeed afford this type of loan program.
A dictionary for home mortgage terms helps you get an idea about the different mortgage related aspects. This ultimately helps you find out the best mortgage loan for you.
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