Mortgage Loan ABC - Speak the same language

Speak the same language - Learn the lingo of loans

Don't assume that because you can speak the lingo of mortgage fluently you can also speak to jingoistic lenders with equal fluency. Here, we explain basic loan lingo related to home loans that cut across all income brackets. Read through the various mortgage loan options and see what they are all about.

Government or conventional loans: The United States is a large player in the residential mortgage market. About 20 percent of home loans are either guaranteed or insured by an agency of the federal government. These mortgages are also called government loans. The remaining 80 percent of residential mortgages are referred to as conventional loans. These loans are mortgage loans usually provided by lenders who are not government-sponsored such as the FHA, VA or RHS.

Federal Housing Administration (FHA):

Set up in 1934 during the Great Depression to encourage the U.S. housing industry, this body encourages people of low-to-moderate income to get mortgages by giving federal insurance against losses to those lenders who make FHA loans. The FHA, however is not a money lender. In fact, borrowers must look for an FHA-approved lender such as a bank or financial institution that will give them a mortgage which the FHA will then insure.

Department of Veterans Affairs (VA): This provision enables people on active duty and veterans to buy homes. The VA does not have money of its own but acts as a lender that guarantees mortgages and loans granted by lending institutions. In fact, VA loans are usually sponsored by the U.S. Department of Veteran Affairs. They offer competitive interest rates, little or no down payments and very little declaration of income.

Farmers Home Administration (FHA): Like the above two bodies, this one too is not a direct lender. Contrary to its name, one doesn't have to be a farmer to obtain a loan from this institution. But you do need to buy a home in the countryside for which the FHA insures mortgages. These loans come with minimal down payment and are easier to obtain than others. These loans are FHA loans are overseen by the Federal Housing Administration.

These loans come from lenders with attractive features such as minimal cash down payments, long loan terms, penalty-free if you repay before time, and lower interest rates. But these loans are targeted towards specific kinds of home buyers, have comparatively low maximum mortgage amounts, but take very long to obtain approval.

Apart from these three basic loan types, you can also choose from:

Fixed rate loans: Easy to qualify for, lenders to this mortgage offer you this loan which comes in 20 and 30 year schemes and gives you a good chance to keep your mortgage payments easy on the pocket over a long duration. If you plan to live in your home for several years and keep your expenses at a minimum, this loan is for you.

Adjustable rate loans (ARMs): Though this loan scheme has a low adjustable rate, it is not unusual for lenders to give you a maximum period of 10 years for repayment. The rule is that the low start rate means a short time before you start paying the first mortgage installment.

Combination (hybrid) loans: These loans combine a fixed rate with ARM loans. They have a built-in delayed adjustment period of which the initial period is fixed. They carry very little risk-usually lesser than one year and come with an interest rate that's lesser than fixed-rate loans. Though they begin as fixed rates loans, they adjust to ARM after a few years. This is meant for people on the move as lenders of a combination loan allow buyers to make use of low interest rates for repayment in the initial years of the mortgage scheme.

Balloon mortgages and pledge asset loans: Here, your monthly mortgage installments are based on a fixed term up to 30 or 15 years amortization. At the end of this balloon period, your lender will tell you that the remaining mortgage loan amount is due for payment. Pledged asset mortgages are loans meant for those with sufficient income to pledge their investments as collateral in place of a cash down payment.

This Option may not cost you an ARM Consider your Options with Adjustable Rate Mortgages

The Payoff of Student Loan Consolidation

Closing the Deal Plowing through the Mortgage Paperwork

Shop til the Rates Drop Looking for a Great Mortgage Interest Rate

A Lending Hand Only Good Credit Need Apply

Mortgage Loan
◦ 5 Scams - Countdown of the most extreme
◦ A Lending Hand - Only Good Credit Need Apply
◦ A Risky Proposition - How You Score Matters
◦ APR, FICO, HELOC - The FAQ's on these Little Initials and More
◦ Asking the Right Questions before Signing a Loan
◦ Balloon Payments Full of Hot Air?
◦ Case in Point - Negotiating Mortgage Points before Signing Anything
◦ Closing the Deal: Plowing through the Mortgage Paperwork
◦ Crossing that Bridge Loan when you come to it
◦ Don't Come in Second when Shopping for Reasonable Second Mortgage Terms
◦ Don't Lose Your Shirt or Your Home - Keep an eye out for crooked mortgage companies
◦ Don't take it personally-What to do when you are turned down for a loan
◦ FICO: Your Personal Financial Score Card
◦ Friends Don't Let Friends Loan Money:
◦ FYI on PMI - General Information on Private mortgage insurance
◦ Give yourself a little Credit:
◦ Glutton for Punishment? Co-sign a Loan
◦ Go for Broker: A Mortgage Broker Can Pay Off for You
◦ Government Grown Loans - The Lowdown on FHA and VA Loans
◦ Highway robbery - How to avoid getting taken advantage of in the loan process
◦ House Rich and Cash Poor - Buying a home that you can afford
◦ How do you Rate? Credit Reports Tattletale on your Finances
◦ In a Fix: Unsurprising Mortgage Payments you can Count on
◦ Kids in College Can Be a PLUS - Parents, Know your Education Funding Options
◦ Lending a Hand: How to Help Family financially but not get taken advantage of
◦ Lying about loans - Legality of using loan money for something other than its purpose
◦ More house than you need? Shop around before signing
◦ Mortgages Can Be Taxing - What You Should Know about Closing Costs and Fees
◦ On the Road Again: Advice about loans for RVs and other recreational vehicles
◦ One size does not fit all - choosing the right loan for you
◦ Owning vs. Renting - The Big Debate
◦ Pay them off - The advantages of paying
◦ Payday Loans REALLY Make You Pay in the End!
◦ Pre-approved for a loan? Don't get your hopes up
◦ Ramifications of Refinancing
◦ Scam is a Four-Letter Word in the Mortgage Category
◦ Score High and Keep Interest Low - The Ins and Outs of Credit Scoring
◦ Shop 'til the Rates Drop - Looking for a Great Mortgage Interest Rate
◦ Speak the same language - Learn the lingo of loans
◦ Study your Options on Student Loans
◦ Take Note of the fine print on your mortgage papers
◦ The ABC's of Amortization
◦ The Lowdown on Loan Options
◦ The Mystery of Mortgages
◦ The Payoff of Student Loan Consolidation
◦ The Pros and Cons of Consolidation
◦ This Option may not cost you an ARM - Consider your Options with Adjustable Rate Mortgages
◦ Upside Down - Avoid Owing More on your Loan than the Value of your Car
◦ When disaster strikes - Find out your options BEFORE something happens
◦ Buying or Selling, is the Mortgage Your Only Option?
◦ Equity and Your Home, A Hidden Asset?
◦ Fannie Mae and the Home of Your Dreams
◦ Financial Planning and Interest Only Mortgages
◦ Government Approved Mortgage Loans
◦ Home Equity Lines of Credit
◦ How Does Fannie Mae Work?
◦ How Real Estate Drives the Interest Only Mortgage Market
◦ How to Shop for Low, Interest Only Mortgages
◦ Interest Only and Credit Card Debt
◦ Interest Only In Your Best Interest?
◦ Interest Only Mortgage versus Balloon Notes
◦ Interest Only Mortgages: A Risky Real Estate Move?
◦ Interest Only Mortgages and the LIBOR, What is it?
◦ Interest Only Mortgages and the Young Professional
◦ Interest Only Mortgages for the Wealthy Investor
◦ Is the 20% Down Requirement Still Alive?
◦ Is Your Credit Working Against Your Mortgage Options?
◦ Middle America Goes Upscale on Interest Only Options
◦ Mortgage Companies: Specialty Guys
◦ Mortgage Interest and Your Tax Liability
◦ Mortgage Products: The 15 FRM
◦ Mortgage Products: The 15 Year ARM
◦ Mortgage Products: The 20 FRM
◦ Mortgage Products: The 20 Year ARM
◦ Mortgage Products: The 30 FRM
◦ Mortgage Products: The 30 Year ARM
◦ Mortgage Products: The Adjustable Rate Mortgage

A Home Mortgage Loan Calculator Helps you Determine Affordability of a Home