The real estate market is currently very tough on buyers BUT people are still buying homes at the Lake of the Ozarks. That being said, it's important as a buyer, that you have a mortgage lender at the Lake of the Ozarks that can act quickly and you can count on! First Bank of the Lake is here to give you a few more mortgage terms that are important to know, in this week's blog.
Common Mortgage Terms to Know: Part 7
Hazard Insurance
A contract whereby an insurer, for a premium, undertakes to compensate the insured for loss on a specific property due to certain hazards (i.e. fire).
Home Equity Line of Credit
A form of revolving credit in which your home serves as collateral.
Homeowner's Insurance
An insurance policy that combines liability coverage and hazard insurance.
Homeowner's Policy
A multiple peril insurance policy available to owners of private dwellings which covers the dwelling and its contents, as well as personal liability.
Homeowners' Association Dues
The fees imposed by a condominium or homeowners' association for maintenance of common areas.
Housing Expense Ratio
The relationship of a borrower's monthly payment obligation on housing PITI(principal, interest, taxes, insurance) and other applicable housing expenses, divided by gross monthly income, expressed as a percentage. Also called the top ratio.
In File Credit Report
Unverified credit report which may contain unchecked, duplicated, or overlapping data. It is often used for a quick look at a prospective borrower's credit history.
Income/Expense Ratio
A qualifying ratio used in underwriting a residential mortgage loan which computes the percentage of monthly income required.
Index
A published interest rate, such as the prime rate, LIBOR, T-Bill rate, or the COFI(Cost of Funds Index). Lenders use indexes to establish interest rates charged on mortgages or to compare investment returns. On ARMs, a predetermined margin is added to the index to compute the interest rate adjustment.
Installment
The periodic payment that a borrower agrees to pay a mortgage lender.
Insured Loans
A loan insured by HUD-FHA or a private mortgage insurance company.
Interest
Consideration in the form of money paid for the use of money. Also a right, share or title in property.
Interest Rate
The percentage of an amount of money which is paid for its use for a specified time.
Interest Rate Cap
A provision of an ARM limiting how much interest rates may increase per adjustment period. See also Lifetime cap.
Investment Property
Real estate owned with the intent of supplementing income and not intended for owner occupancy.
Have A Question About Finding A Mortgage?
We're here for you! First Bank of the Lake puts YOU first. Going through the mortgage process for the first time can be really tough. We can help you through it. Give us a call at the number listed below for more information. You can follow us on our social media channels listed below to stay up to date on our latest announcements.
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