So you have met with the Lender and you have asked the right questions......The Lender answers and you are like what?....say what??? He or she starts throwing all these terms at you.
Here are some common terms that will help you understand :-
Pre-qualification for a loan- Pre-qualification is an estimate of your purchasing power and can be done with a verbal statement.
Pre-approval for a loan is done by the Lender . You will have to complete a mortgage loan application, provide recent pay stubs, bank statements and any other supporting document your lender requires.
APR or Annual Percentage Rate - This is the finance charge expressed as an annual rate.
GFE or Good Faith Estimate - this is an estimate of your closing costs when you are purchasing a house.
PITI or Principal, Interests, Taxes (real estate) and Insurance.
* Principal - the original balance of money lent, excluding interest
* Interest - the amount a lender charges to borrow money, expressed as a percentage
* Taxes - real estate tax assessed by city or county
* Insurance - includes homeowner/hazard insurance and any mortgage insurance
Now you know....not so intimidating as you thought ....ha!!!
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