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
The option to convert an ARM to an FRM at some point during its life. ...
An upfront cash payment required by the lender as part of the charge for the loan, expressed as a percent of the loan amount; e.g., '3 points' means a charge equal to 3% of the loan ...
The period between payment changes on an ARM, which may or may not be the same as the interest rate adjustment period. ...
The total cash required of the home buyer/borrower to close the purchase plus loan transaction or the loan transaction on a refinance. Required cash includes the down payment, points and ...
A second mortgage on a property that is not paid off when the first mortgage is refinanced. The second mortgage lender must allow subordination of the second to the new first mortgage. ...
The ratio of total housing expense to borrower income. This ratio is used (along with other factors) in qualifying borrowers. ...
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A request for a loan that includes the information about the potential borrower, the property and the requested loan that the solicited lender needs to make a decision. In a narrower sense, ...
In general, a Down payment is a one-time payment a buyer makes to diminish the risks of the seller of expensive goods like a car, or a house. In Real Estate, the home buyer makes a down ...
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