Should I Pay Points For A Lower Rate?
Paying points for a lower interest rate is a trade off between paying money now versus paying money later. A point - equaling 1% of the total loan amount - is an upfront fee that reduces your monthly interest rate and total interest due over the life of a loan. Use our calculator to figure out the cost and effective saving of loan points as well as the minimum amount of time it will take to recover your loan points.
Popular Mortgage Glossary Terms
A borrower with the best credit rating, deserving of the lowest prices that lenders offer. ...
A borrower who must use tax returns to document income rather than information provided by an employer. ...
A government-owned or -affiliated lender that makes home loans directly to consumers. With minor exceptions, government in the U.S. has never loaned directly to consumers, but housing banks ...
Fees assessed by lenders when payments are late. Late fees are usually 4% or 5% of the payment. A borrower with a 6% mortgage for 30 years who pays a 5% late charge every month raises his ...
A computer-driven process for informing the loan applicant very quickly, sometimes within a few minutes, whether the application will be approved, denied, or forwarded to an underwriter. ...
The definition of credit risk is at the core of lending. Banks lend money to businesses and individuals and expect to recover the principal and win interest. Banks offer a variety of loans, ...
A documentation rule where the borrower discloses assets and their source but the lender does not verify the amount. ...
A request for a loan that includes the information about the potential borrower, the property and the requested loan that the solicited lender needs to make a decision. In a narrower sense, ...
A comprehensive and time-adjusted measure of loan cost to the borrower. IC on a Mortgage: IC is what economists call an 'internal rate or return.' It takes account of all payments made by ...
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