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Mortgage Types and Terms
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Fixed-Rate Mortgage
Offers a constant interest rate and monthly payments over the life of the loan.
Adjustable-Rate Mortgage (ARM)
Features an interest rate that can change at specified times, generally in relation to an index.
Interest-First Mortgage
A type of mortgage where early payments are applied only to interest, not to the principal.
Conforming Loan
A mortgage that is equal to or less than the loan limits set by the FHFA and meets other criteria.
Construction Loan
A short-term loan used to finance the building of a home or another real estate project.
Subprime Mortgage
A type of mortgage made to borrowers with lower credit scores, often at higher interest rates.
VA Loan
A mortgage loan program established by the United States Department of Veterans Affairs to help veterans and their families obtain home financing.
Jumbo Loan
A mortgage that exceeds the conforming loan limits set by the Federal Housing Finance Agency (FHFA).
Home Equity Loan
A type of loan in which the borrower uses the equity of their home as collateral.
FHA Loan
A government-backed mortgage insured by the Federal Housing Administration, designed for lower-income borrowers.
USDA Loan
A zero-down-payment mortgage for rural and suburban homebuyers, offered by the United States Department of Agriculture.
Bridge Loan
A short-term loan used to 'bridge' the gap between the costs of new property and expected proceeds from the sale of a current home.
Shared Appreciation Mortgage
A loan where the lender may share in the appreciation of the home's value in exchange for offering a lower interest rate.
Interest-Only Mortgage
Allows the borrower to pay only the interest on the mortgage for a set period of time.
Buydown Mortgage
A mortgage where the interest rate is lowered due to an upfront payment or periodic payments by the borrower or a third-party.
Reverse Mortgage
Allows older homeowners to convert part of their equity into cash without selling their home.
Balloon Mortgage
Requires a large payment at the end of the loan term, typically after a series of low monthly payments.
Home Equity Line of Credit (HELOC)
A revolving line of credit where your home is used as collateral.
Graduated Payment Mortgage (GPM)
A type of fixed-rate mortgage where the payment increases gradually over time.
Conventional Loan
A mortgage not guaranteed or insured by any government agency, such as FHA or VA.
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