Loan-to-Value (LTV) ratio is a financial metric that quantifies the proportion of a property’s value that is financed through a loan. It provides lenders with insights into the extent of financial exposure they are assuming when lending to a borrower. LTV is typically expressed as a percentage and is calculated by dividing the loan amount by the appraised value of the property securing the loan.

The Annual Percentage Rate is not the interest rate on the Note for which the borrower has been approved for. The ARR is the cost of the loan in percentages, taking into consideration various loan charges of which interest is only one charge. The yearly cost of a mortgage, including interest, mortgage insurance, and the origination fee, points, expressed as a percentage. The APR is calculated by spreading the specified charges over the lifetime of the loan which results in a much higher rate than the approved rate by the lender.

The annual percentage rate can be looked at in two primary ways: the nominal rate, which is a non-adjusted simple rate, or the effective rate, which takes compound interest into account. While the nominal rate is relatively straightforward, there can be many different ways of calculating the effective rate, depending upon how fees are factored into the equation.

The APR is the simplified counterpart to the effective interest rate that the borrower will pay on a loan. When not using the term “effective APR”, the use of “APR” is an early term for normal APR. In many jurisdictions, lenders are required to disclose the “cost” of borrowing in some standardized way as a form of consumer protection.

APR is intended to make it easier to compare lenders and loan options. The APR is likely to differ from the “note rate” or “headline rate” advertised by the lender, due to the addition of other fees that may need to be included in the APR. APRs can be found by asking the lender or by reading the appropriate section in the disclosures.

This is the retail cost added to the wholerate as explained in our Nevada State Broker link. Our Broker paid compensation is 2% over the wholesale rate for most of our loan products so our rates stay very competitive. This retail cost is typically 2% between 4% over the wholesale rate for most retail lenders. This Broker paid compensation is typically paid by the wholesale lender, it’s paid to the Broker/Banker by increasing the rate. This office does not charge any origination Broker fees.

Hazard Insurance protects a homeowner against the costs of damage from fire, vandalism, smoke, and other causes. When you take out a mortgage, the lender will require you to take out hazard insurance to protect their investment; many lenders will incorporate the insurance payment into your monthly mortgage payment.

Flood Insurance, depending on the location of your home, flood insurance may be required and payment of the first year’s premium must be made in advance of closing. Real Estate property taxes, the lender will normally require two to three quarters paid upfront at closing, these Real Estate taxes are levy’s placed on the property that the owner is required to pay

These are deposits paid by the borrower to the lender for homeowners insurance, taxes, and sometimes mortgage insurance and assessments, these deposits are placed into an account called an escrow impound account.

• Estimated Prepaid Items/Reserves

These estimated prepaid items and reserves include taxes, insurance, and mortgage insurance, The number of months in reserves that is collected at closing will depend on what month it is, and where you fall in relation to the billing cycle associated with taxes, and insurance. An established impound account must have enough reserves in it to pay the bills when they come due. In addition borrowers should expect to pay home owners insurance and property taxes due inside of escrow if they are financing close to the end of the billing cycle. If you tax or insurance bill is due within three months expect to pay your taxes and insurance due inside of escrow when closing. The escrow and prepaid’s are considered items you would have to pay regardless of your refinance loan or whether you where purchasing.

• Closing costs are fees associated with the finalization of a real estate contract and the origination of a loan, and they can vary considerably, depending on the situation. In order for the deal to go through, the buyer must have these funds on hand at closing, when the change of ownership takes place. Estimated closing costs are provided by real estate professionals and lenders at the start of the escrow period to give buyers and sellers an idea of the closing costs they can expect with their particular real estate deal.

A real estate stamp tax fee, more commonly known as a real estate transfer tax, is a fee assessed during the transfer of real estate between two parties

The VA Funding Fee is a set fee charged to each veteran who is closing a mortgage with the Veteran’s Administration. The fee varies based on the situation and the down payment on the loan itself.

Value, this determines the maximum Base Loan Amount (BLA), prior to including

the UFMIP – not to exceed FHA’s maximum county loan limit.