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Mortgage Types and Terms

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Fixed-Rate Mortgage

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Offers a constant interest rate and monthly payments over the life of the loan.

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Adjustable-Rate Mortgage (ARM)

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Features an interest rate that can change at specified times, generally in relation to an index.

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Interest-First Mortgage

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A type of mortgage where early payments are applied only to interest, not to the principal.

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Conforming Loan

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A mortgage that is equal to or less than the loan limits set by the FHFA and meets other criteria.

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Construction Loan

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A short-term loan used to finance the building of a home or another real estate project.

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Subprime Mortgage

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A type of mortgage made to borrowers with lower credit scores, often at higher interest rates.

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VA Loan

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A mortgage loan program established by the United States Department of Veterans Affairs to help veterans and their families obtain home financing.

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Jumbo Loan

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A mortgage that exceeds the conforming loan limits set by the Federal Housing Finance Agency (FHFA).

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Home Equity Loan

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A type of loan in which the borrower uses the equity of their home as collateral.

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FHA Loan

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A government-backed mortgage insured by the Federal Housing Administration, designed for lower-income borrowers.

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USDA Loan

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A zero-down-payment mortgage for rural and suburban homebuyers, offered by the United States Department of Agriculture.

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Bridge Loan

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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.

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Shared Appreciation Mortgage

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A loan where the lender may share in the appreciation of the home's value in exchange for offering a lower interest rate.

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Interest-Only Mortgage

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Allows the borrower to pay only the interest on the mortgage for a set period of time.

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Buydown Mortgage

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A mortgage where the interest rate is lowered due to an upfront payment or periodic payments by the borrower or a third-party.

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Reverse Mortgage

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Allows older homeowners to convert part of their equity into cash without selling their home.

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Balloon Mortgage

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Requires a large payment at the end of the loan term, typically after a series of low monthly payments.

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Home Equity Line of Credit (HELOC)

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A revolving line of credit where your home is used as collateral.

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Graduated Payment Mortgage (GPM)

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A type of fixed-rate mortgage where the payment increases gradually over time.

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Conventional Loan

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A mortgage not guaranteed or insured by any government agency, such as FHA or VA.

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