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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 Housing Administration (FHA)
An agency of the U.S. Department of Housing and Urban Development (HUD). It insures residential mortgage loans made by private lenders. FHA also sets standards for underwriting mortgages. |
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Interest-only payments
Mortgage payments that include only interest. No loan amortization occurs and, thus, the homeowner does not accrue any equity (unless the home value increases). |
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Wraparound Mortgage
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. |
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