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| GLOSSARY: G-I |
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Good Faith Estimate - A document that tells mortgage borrowers the approximate costs they will pay at or before closing, based on common practice in the locality.
Government Loan - A mortgage insured by a government agency, such as FHA, VA, Farmers Home Administration or a state bond program. The loans are generally made by private lenders, such as Bay Financial Savings Bank, F.S.B.
Homeowner's Insurance (also called Hazard Insurance) - A real estate insurance policy required of the buyer protecting the property against loss caused by fire, some natural causes, vandalism, etc. It may also include added coverage such as personal liability and theft away from the home.
HUD-1 Settlement Statement - A standard form used to disclose costs at closing. Index - Interest rate adjustments on adjustable-rate mortgage (ARM) loans are based on a specific "index" or treasury issue (bond) which is selected because it is a reliable, familiar financial indicator. Your monthly interest rate payment will be adjusted up or down in relation to this market indicator, plus the margin as specified in your note. See Margin and Note.
Interest Rate - A percentage of the mortgage amount that is paid to the lender for the use of the money, usually expressed as an annual percentage.
Interim Interest - The interest that accrues, on a per-diem basis, from the day of closing until the end of the month.
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