0
Most loans require monthly payments. The ones most referred to in this category are mortgages, car loans, personal loans, and credit card loans. Also, student loans are repaid monthly and usually after a student has left college or has graduated from college. There are some loans where the repayment is in the form of a lump sum. One example of this is margin loans from a stockbroker. Normally when a stock is bought or sold on margin, the money borrowed to complete the transaction is repaid to the stockbroker in a lump sum.
What else can I help you with?
What is the meaning of a recast mortgage and how does it differ from a traditional mortgage?
A recast mortgage is when the borrower makes a large payment towards the principal balance of the loan, which then reduces the monthly payments. This differs from a traditional mortgage because it allows the borrower to lower their monthly payments without refinancing the entire loan.
Can you provide an example of how a mortgage works?
A mortgage is a loan used to buy a home. The borrower makes monthly payments to the lender, which includes both the loan amount and interest. If the borrower fails to make payments, the lender can take possession of the home through a process called foreclosure.
What is mdi on a car loan?
MDI, or Monthly Debt Indicator, refers to a metric used by lenders to assess a borrower's ability to manage monthly debt payments, including a car loan. It typically reflects the ratio of a borrower's total monthly debt obligations to their gross monthly income. A lower MDI suggests better financial health and may qualify the borrower for more favorable loan terms, while a higher MDI may indicate risk, potentially leading to higher interest rates or loan denial.
What are the key differences between an amortizing and a non-amortizing loan?
An amortizing loan is one where the borrower makes regular payments that include both interest and principal, gradually paying off the loan over time. A non-amortizing loan, on the other hand, requires the borrower to make interest-only payments throughout the loan term, with the full principal amount due at the end.
What is the formula for finding the amortization schedule for at least 3 monthly payments of a 30-yr loan?
The mortgage lender will supply the borrower with a complete amortization schedule when requested. The schedule will show previous payments made and the application of all future payments until the completion of the loan.
Can a cosigner take over a car loan if the primary borrower is unable to make payments?
Yes, a cosigner can take over a car loan if the primary borrower is unable to make payments. This means the cosigner becomes responsible for making the payments on the loan.
What is financing a car and how does it work?
Financing a car means borrowing money from a lender to purchase a vehicle. The lender pays the full cost of the car, and the borrower repays the loan amount plus interest over a set period of time. The borrower typically makes monthly payments until the loan is fully paid off. If the borrower fails to make payments, the lender can repossess the car.
Can a cosigner become the primary borrower on a loan?
No, a cosigner cannot become the primary borrower on a loan. The cosigner's role is to provide a guarantee for the loan in case the primary borrower fails to make payments.
What is the best type of loan for a mortgage?
The best type of loan for a mortgage is typically a fixed-rate mortgage. This type of loan offers a stable interest rate and consistent monthly payments over the life of the loan, providing predictability and security for the borrower.
What is the difference between a reverse mortgage and a regular home equity loan?
A reverse mortgage is a home loan taken out by a senior home owner that requires no loan payments for as long as the borrower remains living in the house.
Can you explain what recasting a mortgage means?
Recasting a mortgage is when the borrower makes a large payment towards the principal balance of the loan, which then reduces the monthly payments and potentially the overall interest paid over the life of the loan.
How much does a co-borrower have to earn monthly in order to be approved for a student loan?
== ==
