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Today's Terms
Discount point
Definition:
Normally paid at closing and generally calculated to be equivalent to 1% of the total loan amount, discount points are paid to reduce the interest rate on a loan.
HUD1 Statement
Definition:
Also known as the "settlement sheet," it itemizes all closing costs; must be given to the borrower at or before closing.
Mortgage insurance
Definition:
A policy that protects lenders against some or most of the losses that can occur when a borrower defaults on a mortgage loan; mortgage insurance is required primarily for borrowers with a down payment of less than 20% of the home's purchase price.
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