Closing costs are the total expenses that the buyer pays at the time a real estate transaction is completed. closing costs generally range between 3 and 6 percent of the home purchase price. With conventional loans, the following closing costs cannot be paid by the Seller for the Buyer: Pre-paid interest, Hazard insurance impounds, or Property tax impounds.
A real estate loan with a lien (i.e., mortgage or deed of trust) on the subject property that has priority over any subsequently lien or financial encumbrances.
|Graduated Payment Mortgage (GPM)|
A type of flexible-payment mortgage where the payments increase for a specified period of time and then level off. This type of mortgage has negative amortization built into it.
Results when an existing assumable loan is combined with a new loan, resulting in an interest rate somewhere between the old rate and the current market rate. The payments are made to a second lender or the previous homeowner, who then forwards the payments to the first lender after taking the additional amount off the top.