The report usually includes an evaluation of both the structure and mechanical systems. A measure of interest rate changes used to determine changes in an ARMs interest rate over the term of the loan. A legal hold or claim on property as security for a debt or charge. The relationship between the amount of the mortgage and the appraised value of the property, expressed as a percentage of the appraised value. The number of percentage points the lender adds to the index rate to calculate the ARM interest rate at each adjustment.
Negative amortization occurs when monthly payments fail to cover the interest cost.
The interest that isn't covered is added to the unpaid principal balance, which means that even after several payments you could owe more than you did at the beginning of the loan. Negative amortization can occur when an ARM has a payment cap that results in monthly payments that aren't high enough to cover the interest. A fee or charge for work involved in evaluation, preparing, and submitting a proposed mortgage loan. The fee is limited to 1 percent for FHA and VA loans. Principal, Interest, Taxes and Insurance.