Loan Terminology
Term | Main definition |
---|---|
Adjustable-Rate Mortgage (ARM) | A mortgage loan with an interest rate that can change periodically after the fixed term such as 5 years or 7 years of the loan based on the adjustment period. |
Amortization | |
Annual Percentage Rate (APR) | The annual cost of a mortgage loan, stated as a percentage of the loan amount. It |
Appraisal | A professional opinion of the market value of a property. |
Asset | An item of value that you own. |
Automated Underwriting | A computer-based method that lenders use to process loan applications and to recommend whether to approve the loan (Tied to Fannie Mae and Freddie Mac). |