Qualification Rate

Definition of "Qualification Rate"

Kim Murray
  House2Home Reatly

The interest rate used in calculating the initial mortgage payment in
qualifying a borrower. The rate used in qualifying borrowers may or may not be the initial rate on
the mortgage. On FRMs with Temporary Buydowns, the qualifying rate is the 'bought down' rate. On
ARMs, the borrower may be qualified at the Fully Indexed Rate rather than the initial rate.

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