If you are applying for a mortgage loan in Riverside, CA, it can be advantageous to familiarize yourself with the industry. Specifically, learning the industry jargon can go a long way when the day comes when you sit with a lender.
So, here are some terms that may come in handy during your application for a mortgage loan in Riverside, CA:
Mortgage amortization – pertains to the gradual payment of a mortgage loan scheduled in a specific payment interval (monthly). The payments throughout the loan term, in general, consist of both principal and interest specifically outlined on amortization schedules.
Closing costs – refer to the fees and expenses incurred in completing a real estate transaction, paid at the “closing” or the settlement, which is the final step in the home buying (or selling) process. These costs can vary in a spectrum of disparity, influenced by several factors, such as location, property value, and mortgage loan terms.
Home appraisal – a professional assessment of the fair value of a property. In other words, this process allows you to know the valuation of a property; the finding should be unbiased; hence, a third party does it. Home appraisal is a requirement by lenders before they approve (or deny) a mortgage loan application to buy or refinance a home.
Debt-to-income ratio (DTI) – a risk assessment tool used by lenders, which can help evaluate a borrower’s capacity to manage their monthly debt obligations, helping them to decide about the latter’s eligibility for loans. They calculate by dividing the total monthly debt payment by the gross monthly income, multiplied by 100 (expressed in percentage). Take note that the smaller the number is, the better.
Mortgage loan originators – financial professionals who help with successful mortgage loans to finance a home purchase or refinance a home property. As intermediaries that connect borrowers and lenders, they can help clients navigate the mortgage application and approval process, which can be complex for beginners.
Are you looking for a reputable company to help you obtain a mortgage loan in Riverside, CA? Look no further than Homeplus Mortgage.