Payment Rate
Definition of "Payment Rate"
The interest rate used to calculate the mortgage payment. The interest rate and the payment rate are often the same, but they need not be. They must be the same if the payment is fully amortizing. If the payment rate is higher than the interest rate, the payment will be more than fully amortizing and, if continued, the loan will pay off before term. If the payment rate is below the interest rate, the payment will be less than fully amortizing and, if continued, the loan will not be fully paid off at term.
Popular Mortgage Terms
Mortgages delivered using the Internet as a major part of the communication process between the borrower and the lender. ...
Fees assessed by lenders when payments are late. Late fees are usually 4% or 5% of the payment. A borrower with a 6% mortgage for 30 years who pays a 5% late charge every month raises his ...
A written document evidencing the lien on a property taken by a lender as security for the repayment of a loan. The term 'mortgage' or 'mortgage loan' is used loosely to refer both to the ...
Owner financing or seller financing is a trending real estate concept among homebuyers and sellers. The seller reveals in their asset’s advertising or listing if buyers can purchase ...
A payment made by a lender to a mortgage broker for delivering an above-par loan. A par loan is one on which the lender charges zero points. Lenders charge points on loans carrying ...
On an ARM, the assumption that the value of the index to which the interest rate is tied does not change from its initial level. ...
The ratio of housing expense to borrower income. This ratio is one factor used in qualifying borrowers. ...
Limit on the size of payment change on an adjustable rate mortgage. ...
The lender's risk that, between the time a lock commitment is given to the borrower and the time the loan is closed, interest rates will rise and the lender will take a loss on selling ...
Have a question or comment?
We're here to help.