100% loan
A loan requiring no down payment. The loan amount is equal to the property value.
125% loan
A loan that equates to 125% of the property value.
Option ARM
An adjustable rate mortgage characterized by flexible payment options, monthly interest rate adjustments and very low minimum payments in the early years of the loan. These types of loans carry a risk of very large payments in later years.
Option fee
An upfront fee paid by the buyer under a lease-to-own purchase, usually between 1% to 5% of the price, which is credited to the purchase price when the option is exercised but is lost if it is not.
Origination Fee
An upfront fee charged by a lender to prepare loan documents, make credit checks, inspect and sometimes appraise a property; usually expressed as a percentage of the face value of the loan. It should be added to points in determining the total fees charged by the lender that are expressed as a percent of the loan amount. Unlike points, an origination fee does not vary with the interest rate.
Overage
The difference between the price posted to its loan officers by a lender or mortgage broker, and the price the borrower is charged.
