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Terms and Definitions

1. Property Value It is the value defined by a licensed appraiser
2. Down Payment is money down payment to purchase the property
3. Loan Amount ($) is the amount after the down payment
4. Loan-to-value ratio (LTV) (%) is a percentage of the loan amount to the property value. If the down payment is 10%; then the LTV is 90%
5. Interest Rate (%) is the rate that offered by the lender in the term of your mortgage payment
6. Term (moths) is term of loan in months. The numbers of months used are 360 mths for 30 years
7. Mortgage Payment ($):   is calculation of the principle and interest (PI) of payment of the loan
8. Hazard Insurance ($) is the property insurance in case of natural hazard... required by the lenders
9. Property Tax (%)
is defined by the government - different from county and state
10. MI (Mortgage Insurance) ($) is insurance to protect lender in the situation of loan default. It is different based on the LTV requires by lender if LTV is higher than 80%, MI is required.
11. HOA ($) Home Owner Association known as HOA fees for property locates in community with joint common area such PUD, townhouse and condo complex, etc.
12. Total Housing Expenses (PITI) ($)   is total payment including: mortgage, property tax, property insurance, HOA, and MI. This payment is measured as the front debt ratio for loan qualification
13. Other monthly debts: include all evolving debt payments such credit card and car payment
14. Total family's debt expense: added all housing expense and other debt payments.
15. Qualified Debt Ratio (%): The total housing expenses is used to calculate for loan qualification debt ratio which is different from lender to lender at 40% to 50% known as debt to income ratio (DTI).
16. Qualified Income:

is how much gross income to qualify for a loan. Ex. If the lender uses 50% DTI and the debt payment is $4,000 per month; then required income is $8,000 per month


























Click here to Loan Estimator System

Click Here to get pre-approval letter.