Definition of "Conversion Option"

The option to convert an ARM to an FRM at some point during its life.

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Popular Mortgage Terms

A lender who delivers loans to another (usually larger) lender against prior price commitments the larger lender has made to the correspondent. Mortgage brokers sometimes evolve into ...

A very large increase in the payment on an ARM that may surprise the borrower. The term is also used to refer to a large difference between the rent being paid by a first-time home buyer ...

The specific interest rate series to which the interest rate on an ARM is tied, such as 'Treasury Constant Maturities, One-Year,' or 'Eleventh District Cost of Funds.' ...

The option to convert an ARM to an FRM at some point during its life. ...

A payment made after the grace period stipulated in the note, usually 10-15 days. ...

Same as term housing expense. The sum of the monthly mortgage payment, hazard insurance, property taxes, and homeowner association fees. Housing expense is sometimes referred to as PITI, ...

The amount of the original loan remaining to be paid. It is equal to the loan amount less the sum of all prior payments of principal. ...

The interest rate or rates and upfront fees paid to the lender and mortgage broker. Some upfront charges are expressed as a percent of the loan, and some are expressed in dollars. The ...

A plan purporting to protect FHA homebuyers against property defects. ...

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