Conforming Mortgage
A loan eligible for purchase by the two major federal agencies that buy mortgages, Fannie Mae and Freddie Mac. Conforming mortgages cannot exceed a legal maximum amount, which was $322,700 in 2003; it is raised every year. They must also meet the agencies' underwriting requirements regarding credit, documentation, property features, and other factors. A mortgage in excess of the conforming maximum, which is identical in other respects, will have an interest rate about 3/8% higher. Borrowers who need an amount larger than the maximum will often do better taking a conforming loan for the maximum and a second mortgage for the excess.
Popular Mortgage Terms
Inserting provisions into a loan contract that severely disadvantage the borrower, without the borrowers knowledge, and sometimes despite oral assurances to the contrary. Prepayment ...
A letter from a lender verifying that the price and other terms of a loan have been locked. Borrowers who lock through a mortgage broker should always demand to see the lock commitment ...
Markets in which mortgages or mortgage-backed securities are bought and sold. 'Whole Loan' Markets Versus Securities Markets: Secondary mortgage markets are of two general types. 'Whole ...
One of many interest rate indexes used to determine interest rate adjustments on an adjustable rate mortgage. ...
A lenders requirements regarding how information about income and assets must be provided by the applicant and how it will be used by the lender. The following categories have evolved in ...
The frequency of rate adjustments on an ARM after the initial rate period is over. The rate adjustment period is sometimes but not always the same as the initial rate period. As an example, ...
The house in which the borrower will live most of the time, as distinct from a second home or an investor property that will be rented. ...
Trying to find the best deal on a mortgage. It isn't easy to do right, as a summary of the major steps involved will demonstrate. Step 1: Decide if you are a potential shopper. Step 2: ...
Limit on the size of payment change on an adjustable rate mortgage. ...
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