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Equity: This is amount of money that you have vested in your home. This can be determined by subtracting lien amount from property's value.
Equity Loan: A loan or line of credit that is based on amount of equity that you have in your home. Your home is essentially used as collateral.
Fixed Interest Rate: An interest rate that remains constant throughout life of loan. A fixed-rate mortgage will have same interest rate and payments for length of loan.
Home Equity Line of Credit: Similar to a home equity loan, but you receive a line of credit that you can draw upon at any time.
Home Equity Loan: A loan based on amount of equity you have in your home.
Interest: This is cost for borrowing money.
Interest Rate: This is percentage of loan amount that you must add to your principle, for privilege of borrowing money.
Loan-To-Value Ratio: This is ratio between amount of loan and actual value of home. Some loans can give you up to a 125% Loan-To-Value Ratio.
Market Value: This is price that buyers would be willing to pay for your home, at present time. This can vary from actual sale price of home.
PITI (Principal, Interest, Taxes, and Insurance): This is usual breakdown for mortgage payments.
Principal: The amount of your original loan before interest was added.
John Ross is a freelance author who writes articles about financial loans including: home equity loans company, online home equity loans, and fixed rate home equity loans.