Loan origination refers to the whole process from prospecting for borrowers to the moment a loan is closed and disbursed.
This includes the stages of:
As a lot of resources are used to originate a loan, it is only fair that an origination fee is charged by the lender.
Foreclosure is the legal process undertaken by a lender in order to acquire possession of a property used as collateral for a mortgage when the borrower defaults.
When a borrower has defaulted and deem to be in delinquency, a lender will have the legal right to start foreclosure proceedings.
Sometimes, a deed in lieu of foreclosure allows the transfer of the property to the lender without going through the foreclosure process.
The interest due on a loan is the amount of interest that a borrower has to pay for a specified period within the term.
This is calculated by taking the loan balance and multiplying it with the annual interest divided by the accrual period.
For monthly accrual loans, interest due is calculated by taking the loan balance at the end of the month multiplied by the monthly interest rate (annual rate divided by 12).
Refinancing refers to the process of paying an existing mortgage with a new one.
While the majority of homeowners refinance their home loans to save on interest costs, a lot of them also do it to raise cash for various purposes.
It goes without saying that in order to save money from the future payments towards a mortgage, the new mortgage has to have an interest rate lower than the existing one.