FAQ

A mortgage is a loan that allows you to borrow money to buy a property and then make monthly payments to repay the debt with interest. 

Refinancing is when you re-work an existing mortgage for more favorable deal points such as a more convenient payment schedule, a lower interest rate or a different term.  

The annual percentage rate (APR) is the cost of borrowing money from the lender, shown as a percentage of your mortgage amount. The APR includes the interest rate as well as all other fees that are paid over the life of the loan. 

An adjustable-rate mortgage is a loan that has interest rates that change periodically. Such loans have an introductory period of low, fixed rates, after which they vary, depending on an adjustment index. 

A fixed-rate mortgage has the same interest rate throughout the term of the loan. For example, 3% for 30 years.  

A pre-approval is a document that tells you how much you can afford to take out for a mortgage loan based off your credit score, income and assets. 

Your down payment is the first payment you make on your mortgage loan, usually listed as a percentage of your loan value. Most loan types require some kind of down payment. 

Closing costs are settlement costs and fees you pay to your lender in exchange for finalizing your loan such as appraisal fees, loan origination fees and pest inspection fees.  

An appraisal is a rough estimate of how much your home is worth. This is typically required for the mortgage loan and insurance provider.