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
Administering loans between the time of disbursement and the time the loan is fully paid off. Servicing includes collecting payments from the borrower, maintaining payment records, ...
Same as term housing expense. The sum of the monthly mortgage payment, hazard insurance, property taxes, and homeowner association fees. Housing expense is sometimes referred to as PITI, ...
All the combinations of interest rate and points that are offered on a particular loan program. On an ARM, rates and points may also vary with the margin and interest rate maximum. ...
A comprehensive and time-adjusted measure of loan cost to the borrower. IC on a Mortgage: IC is what economists call an 'internal rate or return.' It takes account of all payments made by ...
The sum of the monthly mortgage payment, hazard insurance, property taxes, and homeowner association fees. Housing expense is sometimes referred to as PITI, standing for principal, ...
The process of raising cash periodically through successive cash-out refinancings. This is a scam initiated by mortgage brokers that victimizes wholesale lenders, with the connivance of ...
Mortgages delivered using the Internet as a major part of the communication process between the borrower and the lender. ...
The period over which the interest due the lender is calculated. The interest accrual period may or may not correspond to the payment period. On the annual accrual mortgages in the UK, ...
The option to convert an ARM to an FRM at some point during its life. ...
Have a question or comment?
We're here to help.