Option ARM
An adjustable rate mortgage loan with the option of four different monthly payment
amounts: minimum payment, interest only, full principal and interest (30-year
term) and full principal and interest (15-year term). These loans typically have
a low initial fixed interest rate for a specified period of time. Beyond the fixed
interest period, rates are subject to adjust monthly based on the specified index.
Payment option amounts after the initial fixed interest period are subject to
change annually. Deferred interest, or negative amortization, is possible with
these loans.
Origination Date
The date on which the loan is funded.
Origination Fee
A fee imposed by a lender to cover the administrative costs of setting up a mortgage.
This will include the preparation of documents and certain processing expenses
in connection with making a real estate loan. This is usually charged as a percentage
of the amount loaned, such as one point or one percent.
Owner Occupant
A residence lived in by the borrower.