Borrowers who contribute income and credit history to the qualification process of a loan and whose names appear on all closing documents. Each additional borrower is equally liable for the debt and condition of the property.
Adjustable Rate Mortgage (ARM)
A mortgage loan in which the interest rate is adjusted periodically according to a pre-determined adjustment criteria.
Adjustment Date
The date the interest rate changes for an adjustable rate mortgage (ARM).
Adjustment Period
The interval of months between the interest rate adjustment dates for an adjustable rate mortgage (ARM).
Amount Financed
The Amount Financed is not the amount of the loan. It is the requested loan amount minus the prepaid finance charge. The Amount Financed is the amount on which the APR is based. For example, if the borrower requests $100,000 and the Prepaid Finance Charge totals $4,000, the Amount Financed would be $96,000.
Annual Percentage Rate (APR)
The actual cost of a mortgage loan expressed as a yearly rate. The APR will be higher than the interest rate stated on the application and note if it includes fees which are categorized as pre-paid finance charges such as: interest, discount points, origination fee, required mortgage insurance and other related fees. The Truth in Lending Act requires lenders to disclose an APR to assist the borrower in measuring the actual cost of a loan on an annualized basis.
Application
A form used by mortgage lenders to document necessary information concerning the mortgage loan applicant(s).
Appraisal
An official report created by a qualified appraiser that establishes an opinion or estimate of property value. The estimate of value is generally obtained by comparing homes similar to the "subject" home within the same location or neighborhood.
Appraised Value
An opinion or estimate of property value provided by a certified property appraiser. The estimate of value is generally obtained by comparing homes similar to the "subject" home that are within the same location or neighborhood.
Available Cash
The amount of liquid assets (i.e. checking, savings, mutual funds, etc.) immediately available to pay closing costs and down payment.
Average Interest Rate
The actual average interest rate for a combination of debts based upon a total weighted interest rate calculation. Utilizing each loan balance and interest rate, the calculator determines an average interest rate for multiple debts.
