Graduated Payment Mortgage (GPM)
Definition of "Graduated payment mortgage (GPM)"
A special kind of fixed rate mortgage (conventional mortgage) in which the monthly payments are less in the beginning years and more in the later years. After five years it usually levels off for the remainder of the loan payment. Under the level annuity, fully-amortized mortgage, each month's payment is the same. For some purchasers the required monthly payment is so high that a lender will not make the loan simply because the borrower's income is insufficient. With a GPM, monthly mortgage payments start at an amount less than would be required under a level annuity payment and increase periodically over the life of the mortgage. Therefore, the borrower can fiance a larger purchase than if the monthly payment were level throughout the life of the mortgage.
Popular Real Estate Terms
A portion of a real estate company's assets financed with debt instead of equity. It involves interest an principal obligations. Financial leverage is beneficial to real estate investors ...
In everyday discourse, a merger defines the combination of two entities, be it real estate or two companies, into a single and legit one. We should make a difference between a merger and ...
Income for investors arising from net long-term profits of a real estate mutual fund realized when the portfolio is sold at a gain. Fund managers pass on profits from sales of real estate ...
A cost of funds index that most adjustable rate mortgages written in California in recent years are tied to. Computed by the Federal Home Loan Bank of San Francisco, it reflects the cost ...
Sponsor sells interest to real estate investors in one property only. The total amount received from the equity investors is used by the sponsor to buy the property for the partnership. ...
Subsoil that is beneath the A horizon and above the C horizon of the earth. ...
Acquired by adverse land use for a statutory period of time. ...
Group of people residing in one home, usually consisting of a family. ...
Net operating income (NOI) of property relative to its market value. If rental income property worth $1,000,000 results in NOI of $100,000, the overall return is 10%. NOI compared to ...
Comments for Graduated Payment Mortgage (GPM)
Do you accept section 8?
Apr 12, 2019 17:52:43Hi Brandie! To find an answer, we recommend that you get in touch with a lender and a local real estate agent.
Apr 18, 2019 06:35:51Have a question or comment?
We're here to help.