Simple Terminology Associated With Home Mortgage Florida
Basic terms which are used in home mortgage Florida documents are mentioned.
Applying for home mortgage Florida? You would be overwhelmed with the documents and procedure. To confuse you even more there is use of terminology in it. You would ask your agent or the lender about it. But in return you would not find favorable answers to it. Below mentioned is the regular terminology used in home mortgage documents.
Additional Principal Payment:
If the borrower of home mortgage Florida thinks of reducing the burden of the principal payment he can make an additional principal payment. Such type of payment takes off some of the burden of pending amount to return and also shortens the tenure of the loan repayment.
Adjustment Date:
The date is registered on which the rate of interest would change if the borrower has opted for ARM loan (Adjustable Rate Mortgage).
Closing:
When the entire process of transaction completes and closes is said to be closing. In case of home mortgage Florida it means completing the process of signing the mortgage documents, disbursing the funds and at times transferring the ownership of property.
Commission:
The fee that is charged for the services that are offered to the applicant of the home mortgage is said to be the commission. It is most of the time in the form of percentage which is earned by the real estate agent for being able to sell the house.
Interest:
The fee that is charged by the lender or the home mortgage company or any bank for using the borrowed money is interest. Usually it is expressed in the form of annual percentage on the principal amount.
Initial Rate of Interest:
The original rate of interest that is assigned in ARM' Adjustable Rate Mortgage is considered as the initial rate of interest. In many documents it is also referred as Start Rate'.
Partial Payment:
This is that payment that the applicant of home mortgage makes. It is usually less than the monthly payment which is scheduled every month.
Principal:
The basic amount of money which a home mortgage Florida applicant has owed is said the Principal amount. This amount does not include Interest'. This would be a part of the monthly payment that the applicant makes to reduce the remaining amount of the mortgage.
Prepayment Penalty:
A penalty is charged to the borrower by the lender for repaying the mortgage in the initial years. Even if a substantial amount is repaid by the borrower he is charged with the prepayment penalty.