Scheduled Mortgage Payment
The amount the borrower is obliged to pay each period, including interest, principal, and mortgage insurance, under the terms of the mortgage contract. Paying less than the scheduled amount results in delinquency; paying more results in a partial prepayment. On FRMs and ARMs that do not allow negative amortization, the scheduled payment is the fully amortizing payment, unless the loan has an interest-only option for some period at the beginning, such as five or 10 years. In that case, the scheduled payment is the interest-only payment until the end of the interest-only period, when it becomes the fully amortizing payment. On ARMs that allow negative amortization, the scheduled payment may be determined by the lender in a number of ways, which can change over the life of the instrument. Some of these ARMs also allow the borrower to elect from alternative payment plans during the early years of the loan. Whatever form the scheduled payment takes in the early years, however, at some point it becomes the fully amortizing payment.
Popular Mortgage Terms
The standards imposed by lenders in determining whether a borrower can be approved for a loan. These standards are more comprehensive than qualification requirements in that they include ...
A bundle of mortgage characteristics that lenders view as comprising a distinct category. The characteristics used include whether it is an FRM, ARM, or Balloon, the term, the initial ...
A borrower who submits applications through two loan providers, usually mortgage brokers, without their knowledge. Home purchasers sometimes submit more than one loan application as a way ...
Every ARM is tied to an interest rate index. An index has three relevant features:availibility, level, volatility. All the common ARM indexes are readily available from a published source, ...
Assuming responsibility for someone else's payment obligation in the event that that party defaults. ...
The definition of an assumable mortgage is what happens when a buyer assumes or takes over a mortgage that the seller contracted. This is a type of financial arrangement that passes an ...
Loan applications that are withdrawn by borrowers, because they have found a better deal or for other reasons. ...
An independent contractor who offers the loan products of multiple lenders, called wholesalers. Mortgage brokers do not lend. They counsel borrowers on any problems involved in qualifying ...
The highest rate possible under an ARM contract; same as 'lifetime cap.' It is often expressed as a specified number of percentage points above the initial interest rate. ...
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