Homeowner's insurance An insurance policy that combines personal liability insurance and hazard insurance coverage for a residence and its contents. The percentage of gross monthly income that goes toward paying a mortgage or rent on a home. 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 .
Hybrid mortgage See alternative mortgage products .
The most common indexes are the one-year Treasury Constant Maturity Yield and the FHLB 11th District Cost of Funds. The sum of the published index plus the margin. For example, if the index were 9 percent and the margin 2.75 percent, the indexed rate would be 11.75 percent. Initial interest rate Starting rate of an adjustable-rate loan. Most mortgage holders can deduct all the interest paid on the loan in filing income tax.