The first step in purchasing a home is to educate yourself about the world of mortgage. Whether you're refinancing, purchasing your first home, or simply interested in learning more, our Mortgage Knowledge Center is designed to inform you on a variety of topics. Don't worry, everybody has questions about the mortgage process so you're not alone. Feel free to browse our Frequently Asked Questions, our "How Do I" and "What is a" sections, as well as our mortgage process overview.
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What is a mortgage?
A Mortgage (also called a home loan) is a legal contract made between a lender and a borrower that uses property as collateral to secure the loan. The lender can take possession of the property if the borrower fails to pay the prearranged home loan payments.
What is a mortgage refinance?
Occurs when borrower uses the money from a refinanced loan to pay off an existing home loan. Borrowers typically do this to extend their home loan period, apply for a lower interest rate, or to use some money out of their equity.
What is a home loan?
see above answer for What is a mortgage
What is a home equity loan?
A is a type of loan that allows a homeowner to obtain cash loans based on the present value of their property minus the mortgage amount still left to be paid off. Homeowners often apply for home equity loans to pay for expenses such as home remodeling, debt consolidation, college education, and other long-term investments.
What is a home equity line of credit or HELOC?
A Home equity line of credit or HELOC gives homeowners access to an open line of credit, where only the outstanding balance accrues interest. HELOCs provide flexibility by allowing borrowers access to money on an as needed basis.
What is a second mortgage?
A second mortgage is a type of mortgage refinancing that allows you to acquire a second loan on your home in addition to your first home loan.
What is a reverse mortgage?
Reverse mortgages are loans that allow homeowners to transfer some of their home equity into cash. In contrast to traditional home loan mortgages, reverse mortgages do not require borrowers to repay their home loan until the homeowner no longer lives primarily at that residence, although he or she stills owns the residence.
What is a mortgage lender?
A mortgage lender is a financial institution that provides prospective homeowners with the funds over a long-term period to pay off their home loan mortgage. Borrowers are required to pay monthly installments to their lender which includes principal, interest, and additional lender fees. Examples, mortgage bankers and mortgage brokers.
What is the difference between a mortgage broker and a mortgage banker?
Mortgage Brokers typically have no warehouse lines, no underwriting ability and require more time to complete the process. Mortgage Bankers actually make the underwriting desicions and close the loans with their own funds. Evolve Bank & Trust is NOT a broker, we originate, process, underwrite and close your mortgage in-house.
What is a mortgage principal?
The mortgage principal is the amount of loan money that a homeowner borrows excluding the interest.
What does APR mean?
Annual Percentage Rate ( APR ) is the percentage used to figure out the total cost of your cash advance loan by taking into account all fees charged by your lender in addition to your loan principal and interest.
What does the word "naviscreen" mean?
Naviscreening is the concept of directly connecting (mortgage) buyers with regionally specific, prescreened, and competent lenders through the simple completion of a universal and secure form.
What is a fixed rate mortgage?
A fixed rate mortgage is a home loan with steady interest rates and monthly payments that do not change throughout the life of the loan.
What is the adjustable rate mortgage?
An Adjustable Rate Mortgage, also referred to as an ARM, has monthly payments that change periodically due to fluctuations in market interest rates.
What is an interest-only mortgage?
are loans that require the borrower to pay only interest on the principal in monthly installments for a fixed period.
What is an amortized mortgage?
Amortized Mortgages refers to loans that are paid in installments comprised of both principal and interest, and which is paid off (or amortized) over a fixed period of time.
How do you calculate LTV or loan-to-value ratio?
The loan-to-value (LTV) ratio of your home is calculated by dividing the fair market value of your home by the amount of your home loan.
What are lender fees?
These fees usually range anywhere from 2 to 5 percent and may include, but are not limited to, things such as appraisal costs, document preparation, and application costs.
What is the Truth in Lending Act?
The Truth in Lending Act is a federal law that was enacted as part of the Consumer Protection Act. This law requires lenders to reveal all information to the borrower and detail all costs associated with the transaction.