Glossary

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3/1, 5/1, 7/1 and 10/1 ARMs
Adjustable rate mortgages in which rate is fixed for three year, five year, seven year and 10-year periods, respectively, but may adjust annually after that.
Adjustment Date
The date that the interest rate changes on an adjustable rate mortgage (ARM).
Adjustment Interval
On an adjustable rate mortgage, the time between changes in the interest rate and/or monthly payment, typically one, three or five years depending on the index.
Adjustment Period
The period elapsing between adjustment dates for an adjustable rate mortgage (ARM).
Amortization
Means loan payment by equal periodic payment calculated to pay off the debt at the end of a fixed period, including accrued interest on the outstanding balance.
Amortization Term
The length of time required to amortize the mortgage loan expressed as a number of months. For example, 360 months is the amortization term for a 30-year fixed rate mortgage.
Annual percentage rate (A.P.R.)
APR is a measurement of the full cost of a loan including interest and loan fees expressed as a yearly percentage rate. Because all lenders apply the same rules in calculating the annual percentage rate, it provides consumers with a good basis for comparing the cost of loans.
Appraisal
An estimate of the value of property, made by a qualified professional called an appraiser.
Appriased Value
An opinion of a property's fair market value, based on an appraiser's knowledge, experience, and analysis of the property.