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Houston Mortgage > Glossary >
Home Equity > H 11-20
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Home equity loan
A loan based on the amount of equity a homeowner has in the property. The interest paid on a home equity loan is usually deductible. Unlike a home equity line of credit (HELOC), the home equity loan features a fixed rate, payment and term, usually five to 15 years. Bankrate gathers quotes based on a $10,000 (or minimum loan amount offered if it is more than $10,000) fixed-rate loan with a term of 60 months.
Home Ownership and Equity Protection Act
A federal law designed to discourage predatory lending in mortgages and home equity loans.
HomeKeeper
Fannie Mae's adjustable rate conventional reverse mortgage, which allows older homeowners to borrow against the value of their homes and receive the proceeds according to the payment option they select. The amount available is based on the number of borrowers and their ages and the adjusted property value. Anyone 62 years of age or older who either owns his or her own home free and clear or has very low mortgage debt is eligible.
Household income
The total income of all members of a household. An important yardstick used by lenders evaluating applications for joint credit.
Housing bubble
A rapid increase in home prices followed by a steep decline. Housing bubbles are uncommon. Most booms end when home prices plateau for a few years. Bubbles occur in only about 20 percent of booms.
Housing expense ratio
The percentage of monthly before-tax income that goes toward a house payment. The rule of thumb is that it shouldn't exceed 28. Also known as the front ratio.
HUD-1 statement
A document with an itemized listing of closing costs payable at the closing or settlement meeting when buying property. The closing costs can include a commission, loan fees and points, and sums set aside for escrow payments, taxes and insurance. It is signed by both the buyer and the seller, who may be paying some of the closing costs. The statement form is published by the Department of Housing and Urban Development (HUD).
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Houston Home Mortgage