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Assessed Value
The value that a taxing authority, such as a county assessor places on real property as a base for computing property taxes. Generally assessed at 80% of value. |
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Equity
In real estate, the interest or value of the real estate over and above the amount of the indebtedness thereon. |
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Fixed-Rated Mortgage
A mortgage on which the interest rate is set for the term of the loan. |
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Points
Points are also called discount points, mortgage points, loan discount points, loan origination fees, or maximum loan charges. Points are prepaid interest assessed at closing by the lender and or the broker. A point is equal to 1 percent of the loan amount. Lenders consider mortgage points as interest that you pay in advance. As a result, the more points you pay when you close the loan, the lower your interest rate. The IRS considers points to be a form of prepaid interest. Discount fees are totally tax deductible for the year the loan is closed for tax purposes, while origination points are tax deductible over two years (half for the year the loan is closed, and half in the year following). |
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