Tag: <span>Principal</span>

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DO YOU WANT TO LOWER MONTHLY PAYMENTS, NOT THE TERM?

Typically,​ ​when​ ​you​ ​make​ ​a​ ​large​ ​principal​ ​payment​ ​on​ ​your​ ​loan,​ ​the​ ​monthly​ ​payment​ ​remains the​ ​same,​ ​but​ ​the​ ​term​ ​of​ ​the​ ​loan​ ​shortens.​ ​​ ​However,​ ​if​ ​you​ ​wish​ ​to​ ​lower​ ​the​ ​monthly​ ​payment instead​ ​of​ ​shortening​ ​the​ ​term,​ ​ask​ ​the​ ​lender​ ​if​ ​they​ ​allow​ ​a​ ​recast.​ ​​ ​A​ ​recast​ ​is​ ​where​ ​a​ ​large principal​...

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INTERESTING LOAN PRODUCTS

A very interesting loan product that can help monthly positive cash-flow consumers pay-off their mortgage sooner is the All-In-One. You don’t hear of this product much in the U.S., but similar products have been offered in Western Europe, Canada, New Zealand and Australia. It is called All-In-One because it combines both a home loan and...

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PITIMI: WHAT IS IT?

The acronym PITIMI represents the components of the monthly mortgage payment. It is defined as follows: • P = Principal • I = Interest • T = Real estate taxes • I = Insurance • MI = Mortgage Insurance The principal is the amount paid against the borrowed funds per month. Interest is the amount...

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LOAN AMORTIZATION: WHAT DOES THIS MEAN?

Mortgage loans are typically amortized over 30 years. What does this mean? A borrower will pay a combination of principal and interest payments over a 30 year term. The interest is front loaded, so for approximately the first ½ of the loan term, the borrower is paying more interest than principal. Loans typically do not...

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MORTGAGE INSURANCE – WHO PAYS?

  Private mortgage insurance is added to the monthly payment of a conventional loan if you put less than 20% down on the purchase of a new home, or have less than 20% equity on the refinance of your home. The amount to be paid will depend on your credit score, the amount of down...