First Time Home Buyers Should Be Aware Of Home Mortgage Vocabulary
As per NY1 Real Estate reporter, first time home buyers should be aware of home mortgage vocabulary. The process of home mortgage is not so difficult like years ago. A first time home buyer is not aware of the home mortgage terms and vocabulary. When in home mortgage we speak about points, it means it is 1 percent of the loan amount and when points are paid it lowers the interest amount. You may find home mortgage loan offering float down option. It means when you lock your rate.
In particular it means, lender is given a chance to lower the rate even if the market rate is higher for home mortgage. You will come across words like margin and cap. It means adjustable loans in home mortgage vocabulary. Cap means how much the rate can increase in one year.
Margin means how above the index you are going to pay. Cienchanowicz said that it is additional insurance that banks require especially now for condos, that should insure what is in the apartment for about 20 percent of the appraised value. This gives an improvement and things custom built-ins in the home mortgage.