Pre-payment Penalty:A feature on some mortgages/promissory notes. Your total monthly payment will typically be more than this amount due to taxes and insurance. Monthly Principal & Interest: Principal (the amount you will borrow) and interest (the lender's charge for lending you money) usually make up the main components of your monthly mortgage payment. Interest: The cost you pay the Lender to borrow their money usually expressed as a percentage (%) of the Loan Amount borrowed. Loan Amount: Amount borrowed from the lender, excluding interest. The one shown in this example is a Fixed Rate Loan over 30 years. An adjustable rate mortgage (ARM) offers a fixed rate for an initial period, typically 3,5,7, or 10 years, and then adjusts every six months, annually, or at another specified period, for the remainder of the term. Some loans have have ARMS (not like an octopus although it can feel like it). Loan Term: Sets the time period over which the loan is being calculated. Lender: Name of Lender (usually a bank) loaning the money to the Buyer/Borrower in order to purchase the property. Seller: Name of the Sellers of the Property. The term Borrower is used when the Buyer is borrowing money to purchase the property. Sales Price: Purchase price of the property.īorrower: Name of the Buyer of the property. Property: Address of property being purchased. Settlement Agent: This identifies us as the one who is doing your closing. The deed and all other required documents are signed, lender funds to disburse, and money is transferred by us as your title company. This is one is for the Buyer.Ĭlosing Date: Date usually set in the contract as to when ownership of the property will be transferred. One is signed by the Buyer (5 pages) and one is signed by the Seller (2 pages). Closing Disclosure: There are two Closing Disclosures when purchasing/selling a property.