![]() Loan Advances – payments made to a borrower, or to another party on behalf of a borrower LIBOR – The London Interbank Offered Rate, used as an interest rate index in the HECM program Leftover Equity – The sale price of the home minus the total amount owed on it and the cost of selling it the amount the homeowner or heirs get when the house is sold. Initial Interest Rate – In the HECM program, the interest rate that is first charged on the loan beginning at closing it equals one of the HUD-approved interest rate indices (1-month CMT, 1-year CMT, or 1-month LIBOR) plus a margin ![]() Home Value Limit – In the HECM program, the largest home value that can be used to determine a borrower’s loan advances Home Equity Conversion Mortgage (HECM) – The only reverse mortgage program insured by the Federal Housing Administration, a federal government agency Home Equity Conversion – Turning home equity into cash without having to leave your home or make regular loan repayments ![]() ![]() Home Equity – The value of a home, subtracting any money owed on it Department of Housing and Urban Development (HUD) that insures HECM loansįederally Insured Reverse Mortgage – A reverse mortgage guaranteed by the federal government so you will always get what the loan promises also, a Home Equity Conversion Mortgage (HECM)įixed Monthly Loan Advances – payments of the same amount that are made to a borrower each month Home / Debt Programs / Housing Services / Reverse Mortgage Counseling / Reverse Mortgage Terms Reverse Mortgage TermsĪcceleration clause -The part of the contract that says when a loan may be declared due and payable.Īdjustable Rate – An interest rate that changes, based on changes in a published market-rate indexĪppraisal – An estimate of how much a house would sell for if it were sold also called its market valueĪppreciation – An increase in a home’s valueĪrea Agency on Aging (AAA) – A local or regional nonprofit organization that provides information on services and programs for older adultsĬap – A limit on the amount an adjustable interest rate may go up or down during a specified time periodĬlosing – A meeting where documents are signed to “close the deal” on a mortgage the time a mortgage beginsĬMT Rate – The Constant Maturity Treasury rate, used as an interest rate index in the HECM programĬondemnation – A court action saying a property is unfit for use: also, the government taking private property to use for the public by the right of eminent domainĬreditline – A credit account that lets a borrower decide when to take money out and also how much to take out also known as a “line-of-credit” or “credit line.”Ĭurrent Interest Rate – In the HECM program, the interest rate currently being charged on a loan, which equals one of the HUD-approved interest rate indices (1-month CMT, 1-year CMT, or 1-month LIBOR) plus a marginĭeferred Payment Loans (DPLs) – Reverse mortgages that give you a lump sum of cash to repair or improve a home usually offered by state or local governmentsĭepreciation – A decrease in the value of a homeĮminent Domain – The right of a government to take private property for public use for example, taking private land to build a highwayĮxpected Interest Rate – In the HECM program, the interest rate used to determine a borrower’s loan advance amounts it equals either the 10-year CMT or the 10-year LIBOR rate plus a margin (see below)įannie Mae – A private company that buys and sells mortgages a government-sponsored business that is watched over by the federal governmentįederal Housing Administration (FHA) – The part of the U. Information for Kids Learning About Money.Foreclosure Scams and what they may look or sound like.Advantages and Disadvantages of Filing for Bankruptcy. ![]() Debt Consolidation & Improved Financial Health.What to Look for in a Credit Counseling Agency. ![]()
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