The gradual repayment of a loan through scheduled monthly payments that include both principal and interest.
The total cost of borrowing, expressed as a yearly percentage. APR includes interest plus lender fees.
A professional estimate of a property’s market value, required by lenders to confirm the home’s worth.
The person applying for and responsible for repaying a mortgage loan.
A financing arrangement where the borrower or seller pays points upfront to temporarily or permanently lower the interest rate.
Fees associated with finalizing a mortgage, including lender fees, title charges, taxes, and insurance.
A document that outlines the final loan terms, closing costs, and cash needed to close. Provided at least three days before closing.
A numerical rating that reflects your credit history and helps lenders determine loan eligibility and interest rates.
A percentage that compares your monthly debt payments to your gross monthly income. Lower DTI improves loan approval chances.
The upfront amount paid toward the purchase price of a home.
A deposit made to show serious intent when making an offer on a home.
The difference between your home’s market value and the amount you owe on your mortgage.
A government‑insured loan designed for borrowers with lower credit scores or smaller down payments.
A loan with an interest rate that remains the same for the entire term.
A document outlining estimated loan costs. (Replaced by the Loan Estimate for most loans.)
Insurance that protects your home and belongings from damage or loss.
A revolving line of credit secured by your home’s equity.
The cost of borrowing money, expressed as a percentage of the loan amount.
A loan where the borrower pays only interest for a set period before principal payments begin.
A document that outlines estimated loan terms, interest rate, and closing costs. Provided within three days of application.
A percentage comparing the loan amount to the home’s value. Lower LTV often means better loan terms.
Insurance that protects the lender if the borrower defaults. Required for many loans with less than 20% down.
A legal document outlining the terms of your loan and your promise to repay it.
Upfront fees paid to lower your interest rate. One point equals 1% of the loan amount.
A lender’s written estimate of how much you can borrow based on verified financial information. (Link this to your Apply Now page.)
Replacing an existing mortgage with a new one, often to lower the rate or change the loan term.
A guarantee that your interest rate will not change for a specified period during the loan process.
Insurance that protects against legal issues related to property ownership.
A federal law requiring lenders to disclose loan terms and costs clearly.
The lender’s process of reviewing your financial information to determine loan approval.
A government‑backed loan for eligible veterans, active‑duty service members, and surviving spouses.
A document guaranteeing the seller has clear title to the property.
Need Help Understanding Your Options?
Our team at ABC United Finance Corp is here to guide you through every step of the mortgage process. If you have questions about any of these terms or want to see how they apply to your situation, we’re just a call or click away.
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