Knowing Negative Amortization
As a real estate player, you have to know about the notion of negative amortization when it comes to your mortgage loan.
You may have heard this term being mentioned by savvy investors and those who know their stuff. Bankers may even attempt to sound professional by sprinkling this term all over their conversations with you.
A negative amortization mortgage loan is gaining widespread popularity. Negative amortization occurs when your payment or interest rate ceiling keeps the actual monthly installment below the level required by the current fluctuating market interest rate. Because you have not made payment of the interest charges in full, the unpaid portion of interest is then added on to your remaining principal amount outstanding in your mortgage loan. Your outstanding balance will therefor increase rather than decrease.
Depending on Read more…
3 Mortgage Terms To Pay Special Attention To
For most people, the biggest financial commitment they make in their lifetimes are when they purchase a property. Unless you are very well off financially, that property investment will be made with a house mortgage loan.
What structure of a mortgage loan you decide to accept depends on your own personal financial situation and position. But like it or not, you are very much at the mercy of the mortgage loan lender if you really need that mortgage to purchase your house. You may have no choice in the end but accept unfavourable terms and high interest rates when you have no other choices.
Unless you are a seasoned property player like Donald Trump, the mortgage application process can be difficult to comprehend. Other then a whole textbook of documents to sign, there are countless terms and conditions to read up processes to be followed. You may even think that you are applying for a job as an astronaut…
So among the whole encyclopaedia to read up and understand, there are 3 terms that you have to pay special attention to. Knowing these important terms will give you a good idea of what to expect when you apply for a mortgage loan.
1) The first thing to note is the loan tenure or term. This is the full time line for the mortgage loan repayment schedule to run to completion. Read more…
