Learn the essential real estate terms you need before buying a home. APR is your true yearly borrowing cost. PMI kicks in when you put down less than 20%, and ARMs let lenders change your interest rate at set intervals, unlike fixed-rate loans that stay the same.
Annual percentage rate. The annual rate charged for borrowing or earned through an investment and represents the actual yearly cost of funds over the term of a loan. Private mortgage insurance. Borrowers have to pay this when they take out a mortgage from a commercial lender and pay a down payment of 20% or less. Adjustable rate mortgage. This type of mortgage allows the lender to change the interest rate at certain points during the term of the loan. Conventional loan: This type of mortgage is not guaranteed or insured by any government agency. Fixed-rate loan: This type of loan has an— where the interest rate doesn't fluctuate during a fixed-rate period of the loan. This allows the borrower to accurately predict the amount of future payments. Federal Housing Administration loan. This type of mortgage is issued by an FHA-approved lender and insured by the Federal Housing Administration. Interest rate. The amount charged on top of the principal by a lender to a borrower for the use of assets. For more information, please click below or call today.
