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Consider this information if you are having trouble deciding to refinance. Frequently asked questions about California Mortgages are answered here.
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Glossary

Besides rocket science, there are few subjects that people find more confusing than mortgage refinancing. There are so many different terms that keeping up with an experienced mortgage lender can be difficult. If you want to get the most out of refinancing your mortgage, you need to be well versed in the subject. With the help of the California Mortgage Refinance Glossary, you can learn about every important mortgage and refinancing term in the industry!

  • Acceleration Clause: A lender's right to require payment for an entire mortgage balance if the borrower defaults on the loan's terms.
  • Adjustable Rate Mortgage (ARM): A mortgage in which the interest rate changes over time. They typically adjust every couple years and changes are based on the index.
  • Amortization: Refers to a type of payment plan for borrowers to get their entire mortgages paid off, usually through monthly payments.
  • Balance: The amount of the original mortgage that must still be paid, including interest.
  • Balloon Mortgage: A type of mortgage that offers a fixed interest rate for several years, usually 5-7. After that period is over, the entire balance of the mortgage is due.
  • Cap: This is a limit as to how high an adjustable rate mortgage's interest rate can reach.
  • Closing Costs: Final fees paid by the borrower for taking out a mortgage or refinancing. These fees can include appraisal fees, real estate taxes, origination fees, and legal fees.
  • Credit Score: A three digit numerical score based on a borrower's past credit history. Credit scores play an important role in determining mortgage interest rates.
  • Default: The failure to make payments on a mortgage by a borrower. Once in default, a lender may choose to foreclose the home.
  • Down Payment: A portion of a home's price paid in cash. The down payment is not included in the mortgage.
  • Fixed Rate Mortgage: A type of mortgage that has a set interest rate for the life of the loan.
  • Foreclosure: Legal procedure that allows a lender to sell off a mortgaged home in order to pay off the borrower's remaining balance.
  • Interest Rate: The amount of interest charged on a monthly loan payment in the form of a percentage rate.
  • Maturity: Essentially, the day the total amount of a mortgage must be paid off by.
  • Principal: The amount of money borrowed to purchase a home that has yet to be paid back, not including interest.
  • Refinance: To take out a new mortgage on your home, usually in order to secure a better interest rate and save money. Let California Mortgage Refinance help you get started refinancing your home today!
  • Sub-Prime Lender: A lender that specializes in providing sub-prime loans to borrower's with poor credit.