The fair market value an appraiser assigns to a particular property, based on analysis of the property in question, and the market conditions in the area, and recent sales data of comparable homes in the area.
|Debt ratio or Debt-to-Income Ratio|
The ratio, expressed as a percentage, is calculated by dividing the monthly payment of long-term debts by gross monthly income.
|Home Equity Loan|
A type of loan that allows homeowners to acquire a loan in addition to their original mortgage/lien using a portion or all of the equity in their home (primary residence). A home equity loan is a generally a second mortgage on the subject property and may be used for any personal needs (i.e., college education, debt consolidation, home improvement, etc).
|Purchase Money Mortgage|
A mortgage given by the purchaser to secure a loan for part or all of the purchase price. Such a mortgage becomes a lien on the property simultaneously with the passing of title, and if immediately recorded becomes prior to any lien against the purchaser.