As the word is commonly used, a mortgage is a loan to buy real property and that is secured by the real property. Real property is land and anything permanently attached to it, such as buildings and trees. A mortgage is actually composed of 2 parts: a promissory note and the mortgage itself, which gives the lender a security interest in the property. The promissory note is a written contract—specifying the details of the loan and your promise to repay the loan to the lender
Mortgages can be categorized in several ways, but the most fundamental and important classification is whether the interest rate is fixed over the term of the loan, or the rate is adjustable. Because a fixed interest rate incurs an interest rate risk to the lender, the longer the period with a fixed interest rate, the higher the interest rate will be.
Conforming or Jumbo Mortgages
Fixed-Rate Mortgage (FRM)
Adjustable-Rate Mortgage (ARM)
Balloon Payment Fixed Mortgages
No comments:
Post a Comment