Step-rate Mortgage
Definition
- A fixed-rate mortgage loan where payments are lower at the beginning of the loan, typically for two years, but then increase after the specified time period.
Synonyms
graduated payment mortgage, increasing payment mortgage
Related Terms and Acronyms
- Balloon Loan — Definition,
- A loan in which the payments aren't set up to repay the loan in full by the end of the term. At the end comes the balloon payment -- one that is larger than the other, periodic payments and pays off the remaining principal.
- Balloon Mortgage — Definition,
- A loan that has regular monthly payments which amortize over a stated term but call for a final lump sum (balloon payment) at the end of a specified term, or maturity date, such as 10 years.
- Balloon Payment — Definition,
- A loan instalment that is larger than the other, periodic payments and pays off the remaining principal.
- Fixed Instalment — Definition,
- Periodic (usually monthly) payment on a loan whose sum does not vary.
- Fixed Rate Mortgage (FRM) — Acronym, Very Important,
- A loan in which the interest rate and payments remain the same for the entire life of the loan. The interest rate and payment amounts are set at the time of loan origination.
- Initial Interest Rate — Definition,
- The introductory interest rate on an adjustable-rate mortgage (ARM), which usually changes at a predetermined time.
- Interest (IN, int) — Acronym & Abbreviation,
- Money paid for the use of borrowed funds, usually expressed as an annual percentage.
➥ Bank account transaction code. - Interest Rate (IR) — Acronym, Very Important,
- The rate a lender charges an individual to borrow money.
- Mortgage (mtg) — Abbreviation, Important,
- A mortgage is a contract stipulating a specific real property, typically a residence or building, as collateral for a loan. The mortgage incurs a rate of interest that varies according to term and other features.
- Principal — Definition,
- The original balance of money lent on an outstanding loan and fees, excluding interest. Also the remaining balance of a loan, excluding interest.
- Principal and Interest (P&I, PI) — Acronym,
- Acronym for the elements of a mortgage payment: principal and interest.
- Principal, Interest and Taxes (PIT) — Acronym, Important,
- Principal, interest and taxes. The components of a monthly mortgage payment.
- Principal, Interest, Taxes, and Insurance (PITI) — Acronym,
- Acronym for the elements of a mortgage payment: principal, interest, taxes and insurance.
- Teaser Rate — Definition,
- Often called the introductory rate, it is the below-market interest rate offered to entice customers to switch credit cards or lenders.
