Mortgage Acronyms: Top 10 Terms You're Likely To Hear
Mortgage talk can sound like a big bowl of alphabet soup. You’ll hear terms like “DTI,” “LTV,” and “APR” thrown around like everyone just gets it. But if you're not in the mortgage world every day, it can be confusing. So, let’s break down 10 of the most common mortgage acronyms.
🏠 1. APR – Annual Percentage Rate
What it means: The total cost of borrowing money - This is including both interest and loan fees.
🧮 2. DTI – Debt-to-Income Ratio
What it means: A comparison of your monthly debt payments to your monthly income.
🧾 3. LTV – Loan-to-Value Ratio
What it means: How much money you’re borrowing compared to the value of the home.
📄 4. LE – Loan Estimate
What it means: A form that shows you the details of your mortgage loan, including interest rate and costs.
💵 5. CD – Closing Disclosure
What it means: The final form with the final numbers & details about your loan before you close.
🏛 6. FHA – Federal Housing Administration
What it means: A government agency that helps people get loans with lower down payments.
🪖 7. VA – Veterans Affairs
What it means: A loan program for people who served in the military.
🌾 8. USDA – United States Department of Agriculture
What it means: A loan program for buying homes in rural areas, often with no down payment.
💳 9. PMI – Private Mortgage Insurance
What it means: Insurance that protects the lender when the buyer puts down less than 20%.
📝 10. P&I – Principal and Interest
What it means: The two parts of your monthly mortgage repayment.
You don’t have to figure it out alone—I’m here to help translate the “mortgage speak” and make sure everything makes sense from start to finish.
Comments
Post a Comment