We decided to write a complete Mortgage Guide for our blog readers. This guide will probably cover each and every topic about Mortgage. We will divide the Mortgage topic into different parts, so that it will be easy for every one to read and understand.
So what is Mortgage?
Mortgage is a security or simply a guarantee of property from the borrower to the lender to request a loan.
Borrower: Borrower is a person who produces or submits mortgage, in the form of property for requesting the loan from the Lender.
Lender: Lender is the person who verifies the mortgage and grants the loan to the borrower.
Mostly, the mortgage (security) is shown in the form of real property. The loan is paid back to the lender in installments, including the interest amount.
Interest: Interest is the profit that the lender receives in the form of profit. Generally, the interest is calculated in percentage.
Mortgage Parameters:
There are five mortgage parameters:
a) Loan Amount: This is the total amount received by the borrower from the lender.
b) Interest Rate: This is the percentage of total loan amount specified the lender, that the borrower has to pay back along with the loan. The interest rate amount is profit for the lender.
c) Loan Term: This is the amount of time given by the Lender to the borrower, to pay back the loan.
d) Property Tax: This is the tax amount that an owner must pay for t=his/her site or property. Property tax is also measured in percentage.
Private Mortgage Insurance: Pmi is the insurance, that borrower has to pay to the lender. This is also measured in percentage.
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