Mortgage Price

Mortgage Price

The interest rate or rates and upfront fees paid to the lender and mortgage broker.

Some upfront charges are expressed as a percent of the loan, and some are expressed in dollars. The price includes the total of each type.

On a fixed-rate mortgage (FRM), one interest rate is preset for the life of the loan. On an adjustable rate mortgage (ARM), the rate is preset for an initial period, ranging from one month to 10 years, and then can change. For ARM shoppers who are uncertain about how long they will be in their house, the price includes ARM features that affect the ARM rate after the initial rate period ends. These include the margin, maximum rate, rate adjustment period, and rate adjustment caps.

The margin is the amount that is added to the index used by the ARM in determining the rate after the initial rate period ends. In a stable interest rate environment, the ARM rate will become the index plus margin, called the “fully indexed rate.” Both the index and the margin are specified in the ARM contract.

The maximum rate is the highest rate permitted by the ARM contract. It tells shoppers how high the ARM rate can go in a rising rate environment.

The rate adjustment period and rate adjustment caps indicate how often the rate is changed and the maximum amount of any change. Hence, they indicate whether any rate increases at the end of the initial rate period will be abrupt or gradual.

References in periodicals archive ?
First-half profits at Santander's UK business plunged by more than a third as the mortgage price war dragged down its income.
FIRST.HALF profits at Santander's UK business plunged by more than a third as the mortgage price war dragged down its income.
Meanwhile, a mortgage price war - which saw Tesco Bank pull out of offering home loans - is set to intensify.
| Competition between mortgage lenders to attract first-time buyers has been increasing A MORTGAGE price war has been particularly intense in the first-time buyer end of the market, according to Moneyfacts.co.uk.
COMPETITION BETWEEN MORTGAGE lenders To ATTRACT FIRSTTIME buyers has been INCREASING A mortgage price war has been particularly intense in the first-time buyer end of the market, according to Moneyfacts.co.uk.
The ACCCs Residential Mortgage Price Inquiry is monitoring the prices charged by the five banks affected by the Governments Major Bank Levy: Australia and New Zealand Banking Group Limited (ANZ), Commonwealth Bank of Australia (CBA), Macquarie Bank Limited, National Australia Bank Limited (NAB), and Westpac Banking Corporation.
Coleri tells us, "The artwork can be listed along with the apartment, which will be included into the mortgage price."
Purchase price: $2.12 million, with an $75,000 down payment and a new mortgage Price per square foot: $19 Last sale: $1.4 million in 2005 Property ID: 33-029-24-12-0014 Date of deed: -4-17 ECRV released: -12-17 Vintage apartments draw $2.4 million Description: 20 apartment units in three Minneapolis buildings, including two matching structures built in 1911 at 2617 and 2621 Third Ave.
0.89% RATE LAUNCHED AS MORTGAGE PRICE WAR HEATS UP A MORTGAGE deal with the lowest rate experts have ever seen at 0.89% has been launched as the home loans price war intensifies.
A mortgage price war broke out after the launch of Funding for Lending, which has given lenders access to cheap finance to help borrowers.
Access to cheap finance has also helped to prompt a mortgage price war, with lenders slashing their rates to some of their lowest ever levels.
OPTA STAT: OPTA STAT: A MORTGAGE price war loomed last night after one of Britain's biggest lenders slashed interest costs on a two-year fixed-rate deal to a record 1.99 per cent low.

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