First National Mortgage
Mortgage Lingo for the first time Home Buyers
- Adjustable Rate Mortgage (ARM) – A mortgage in which the The interest rate can change periodically based on a specified index.
- Amortization – Payments on a mortgage is shared in equal periodic payments calculated to pay within a specified period.
- Amortization Term – length of prescribed time to pay off the mortgage (ie 360 months for a 30-year mortgage).
- Annual Percentage Rate (APR) – The measurement of the full loan amount, loan fees and interest charges, expressed as an annual percentage rate.
- Biweekly Payment – Instead of making payments on a monthly, bi-weekly payment mortgage allows homeowners to pay every two weeks.
- Debt to Income Ratio – The relationship between a borrower's monthly loan payment divided by their gross monthly income, expressed as a percentage.
- Escrow Account – A third-party financial account maintained by a title company which holds money for the benefit of those involved parties in a real estate transaction.
- Federal Housing Administration (FHA) – The FHA is a division of the Department of Housing and Urban Development and is responsible for insuring Mortgages by private lenders. The FHA also mandates standards for underwriting mortgages.
- Federal National Mortgage Association (FNMA) – Also known as Fannie Mae, Federal National Mortgage Association, the Republic is a government sponsored organization who buys and sells conventional residential mortgages.
- Fixed Mortgage Rate – An interest rate that remains constant ("fixed") for the entire duration of the loan (ie, 5.5% for the whole 30 years).
- Interest Rate – The percentage a borrower must pay to borrow money. For example, if the interest rate is 5.5%, the borrower must pay 5.5% of the loan in addition to the actual loan amount.
- Lien – A monetary legal claim to a property by a lender who owe money to the owner of the property.
- Money Merge Account – A popular accelerated mortgage payment offered by the financial institution D Only which allows homeowners to pay their mortgage in less time than the loan.
- Mortgage Broker – A person working on behalf of a borrower to arrange a mortgage contract with a lender.
- Mortgage Insurance – Money paid to secure a mortgage loan when the payment is less than 20% of the loan.
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