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- H |
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| Half Buy Down |
With a half buy down mortgage, also known as a 2/1 buy down, you are able to get a lower initial interest rate, similar to that of an adjustable-rate mortgage, but with the stability of a fixed-rate mortgage. After the first year, the interest rate will increase by one percent and then will increase by one percent again at the end of the second year of your mortgage. After that, your interest rate will remain at a fixed rate for the remainder of the loan. This type of loan will allow you to qualify for a higher loan amount and is ideal if you plan to be making more money a few years from the time that you purchase your home. |
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| Home Equity Conversion Mortgage (HECM) |
Also known as a reverse annuity mortgage, this is a loan where the lender pays you, usually in monthly installments, and you do not need to make monthly payments to repay the loan. A reverse annuity mortgage is the only type of reverse mortgage that is insured by the FHA. Instead of being approved based on your income, you’re approved based on the equity in your home and the loan does not need to be repaid until you no longer live in the home. |
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| Home Equity Line Of Credit |
A revolving loan secured by a home's value that allows you to borrow money as you need it. Like a credit card, you will need to make minimum monthly payments and as you pay the loan off, your credit limit increases again. |
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| Home Equity Loan |
A home equity loan is a fixed or adjustable rate mortgage that allows you to borrow against the equity in your home. The amount of equity in your home is determined by how much your home is worth versus how much money you still owe on the home. In certain circumstances, the interest on your home equity loan may be tax deductible. |
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| Home Owner's Insurance |
A policy that protects you from the losses to your home's value that you would incur due to theft, fire, storms, and vandalism. If your home were to be destroyed, this insurance would cover the costs to have your home rebuilt. These policies also often cover any liability you might incur if someone were to be injured on your property due to the actions of you or your family. |
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| Housing Expenses To Income Ratio |
A percentage ratio that is determined by taking the amount of your monthly housing expenses and dividing it by your gross monthly income. |
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| HUD-1 Settlement Statement |
Also referred to as a closing statement or settlement sheet, this is the itemized statement that you will receive that outlines the costs of obtaining a home loan, payable by you at closing. These costs include line items such as loan fees, agent commissions, and points. The totals at the bottom of the statement will show the net payment that you will need to make at closing and the net proceeds that the seller will receive. This form is avaliable through the Department of Housing and Urban Development (HUD). |
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