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Conforming Loan
Single-family home loans with a maximum loan amount of $359,650 that is typically higher than FHA and VA loans with lower interest rates. |
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Federal National Mortgage Association (FNMA)
A tax-paying corporation created by Congress to support the secondary market in mortgages on residential properties. FNMA sells residential mortgages to lenders (Conventional, FHA insured, and VA guaranteed). FNMA also purchases pools of mortgages from lenders with securities, also know as Fannie Mae, the largest single holder of home mortgages in the United States. |
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Monthly Housing Payment
Typically the total amount of principal, interest, taxes, and insurance (PITI) paid each month on a mortgage loan. Many lenders and investors limit the monthly housing payment to 28% of the gross monthly income. |
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Two-Step Mortgage
A mortgage in which the borrower receives a below-market interest rate for a specified number of years (commonly seven or 10 years). At the end of the 10 years for example, the interest rate is adjusted (within certain limits) to market conditions at that time. The lender sometimes has the option to call the loan due with 30 days notice at the end of seven or 10 years. also called Super Seven or Premier mortgage. |
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