|Adjustable Rate Mortgage (ARM)|
A mortgage whose interest rate changes over time based on an index and a margin. Rate changes are made at prescribed times and within prescribed limits (caps) as defined in the mortgage contract.
|Debt Consolidation Loan|
A type of loan that allows the borrower to payoff all or a portion of existing debt (including the existing mortgage loan) from loan proceeds.
Mortgage payments that include only interest. No loan amortization occurs and, thus, the homeowner does not accrue any equity (unless the home value increases).
|V.A. Mortgage Funding Fee|
A premium assed to the VA borrower in lieu of mortgage insurance. First time VA borrowers have a 3% funding fee included in their loan. When the VA borrower sells their home and uses their VA rights on a new home, the funding fee is 2%. VA borrowers refinancing their home, have a half percent funding fee in their mortgage. Disabled Veterans are not burdened with the funding fee.