Real Estate Word of the Day: Mortgage
A mortgage is a loan specifically used to purchase real estate. It is a financial agreement between a borrower and a lender (typically a bank or a mortgage company) where the lender provides funds to buy a property, and the borrower agrees to repay the loan over a predetermined period, usually with interest.
Types of Mortgages
There's no one-size-fits-all mortgage. Various types cater to different financial situations and preferences. Here are a few common ones:
- Fixed-Rate Mortgage - With a fixed-rate mortgage, the interest rate remains the same throughout the loan's term, providing stability and predictability in monthly payments.
- Adjustable-Rate Mortgage (ARM) - Unlike a fixed-rate mortgage, an ARM's interest rate can fluctuate over time, usually tied to an index like the prime rate. While initial rates may be lower, they can rise or fall depending on market conditions.
- FHA Loans - Insured by the Federal Housing Administration, FHA loans are designed to assist low-to-moderate-income borrowers with more lenient credit requirements and lower down payment options.
- VA Loans - Available to eligible veterans, active-duty service members, and surviving spouses, VA loans offer competitive interest rates, often with no down payment or private mortgage insurance required.
You can submit a mortgage application to a mortgage lender or broker, such as our preferred lender Think Mortgage.
Looking to buy or sell your home on Staten Island? For all your real estate needs, look no further than Tom Crimmins Realty! Give us a call at (718) 370-3200, and we can provide you with professionally-trained agents who are flexible to all that you’re looking for!