Negative Amortization
Definition of "Negative amortization"
Increase in the outstanding loan balance arising when the mortgage payment does not fully meet the interest charge on the loan. This occurs under indexed loans or when the indexed rate change does not impact the period debt service payments. Lower monthly payments are available with negative amortization loans, and most often, borrowers who take this risk are buying in markets with extremely high prices. many gamble that their home will appreciate enough to cover the difference between their payments and the new loan amount.
Popular Real Estate Terms
A leasehold estate that can be determined by the lesser or lessee at any time. ...
Association of the owners of all condominium units in a building that is concerned with managing day-to-day matters in the building complex, including the surrounding and enforcing ...
Something that cannot be taken, returned, or revoked. An example is an irrevocable trust formed by a person giving her real estate to a trust administrator. ...
English architecture. This style has two levels with the second level typically overlaying the first story. The roof is high and the chimney is sculptured. ...
Holder of a real estate license who solicits a prospective buyer of property and receives a commission for his efforts. ...
When an Appraisal is done, its ultimate goal is to define a Market Value for that property. So, in short, market value is the value of a real estate property in a free competitive ...
The accrued interest definition can be explained through the interest collected by a set date on financial obligations that were not paid out. As interest can be of two types, so does ...
The bonus depreciation definition refers to a tax incentive that allows a business to accelerate the depreciation deduction in the year when the asset is purchased and placed into use. The ...
Person leaving from work to spend time in leisure activities. pay in full the balance on a debt either at or before the maturity date. Penalties may be assessed on prepaying a mortgage. ...
Have a question or comment?
We're here to help.