|
|
San Diego real estate library
Top Ten Loan Terms in San Diego
Everyone in San Diego knows that you should never sign on the
dotted line without first reading the contract. The same goes
for loans. Signing a loan without knowing the content and what
everything means can be damaging to your finances, credit, and
future investments. Before you sign anything, make sure that you
know the following terms and how they will apply to you.
1. Interest rate. The percentage of your loan that is added to
the total that you owe every month is called your interest rate.
The percentage will fluctuate according to the economy and will
affect your payments.
2. Fixed Rate. A fixed rate will be an interest rate that stays
at the same percentage throughout the total period of your loan.
3. Variable Rate. A variable rate will adjust following the
economy and the charts that are stating what the rate amount
should be. This type of rate usually moves annually and adjusts
according to a particular given range of percentages.
4. Principal. The principal is what you will view as your
investment as it is what you pay on your actual property.
5. Escrow. This is similar to a savings account for your loan.
Whatever you put in escrow will amass without paying directly
into the loan. At the finish of the term you can use it to
finish paying off the loan or to invest in another loan.
6. Title. A title will be your claim to your home after it is
legitimately yours. It concedes that the property belongs to
you.
7. Deed. A deed is most frequently used as a title for a
commercial area. As opposed to declaring ownership it shows that
the property is leased to the one who is using it as a business.
8. Home Equity. This is a loan or line of credit that you can
get for your home. It will finance up to eight percent of your
other loan and be reimbursed back later. This helps you if you
want to consolidate loans or invest more into the property.
9. Appraisal. After an inspection of the home is made, an
appraisal will be made. This will be an approximated value of
what the home is worth.
10. Equity. This is the actual amount of the property that you
own. Usually, this is what is being paid off of your principal
amount.
After you've mastered these basic terms, you will be able to
expand on your knowledge and find the right loan to meet your
needs. These simple terms will help you in making the right
decision for the type of loan that you want.
San Diego real estate library |
 |
