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Common Home Loan Terminologies Engineers Should Know



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Here are some common home loan terminologies engineers should know:

  1. Principal: The amount borrowed from the lender.
  2. Interest: The cost of borrowing money from the lender, usually expressed as an annual percentage rate (APR).
  3. Term: The length of time over which the loan will be repaid.
  4. EMI: Equated Monthly Installment, which is the amount of money paid to the lender each month to repay the loan.
  5. Down Payment: The initial payment made by the borrower to purchase a home, usually expressed as a percentage of the total purchase price.
  6. Closing Costs: The fees and expenses associated with obtaining a home loan, including appraisal fees, title search fees, and attorney fees.
  7. Collateral: The property that is used as security for the loan.
  8. Prepayment: The ability to make additional payments towards the loan before the end of the term.
  9. Amortization: The process of gradually paying off the loan over time through regular payments.
  10. Refinancing: The process of replacing an existing home loan with a new one, typically to take advantage of better interest rates or other terms.

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