An amortized loan is a type of loan where the borrower makes regular, scheduled payments that include both principal and interest, gradually reducing the balance over the loan's term.
Debt service refers to the periodic payments, typically consisting of both principal and interest, made on a loan. It is a crucial concept in real estate finance and investment, as it impacts cash flow, profitability, and overall financial health of a property or investment.
The Debt Service Constant, also known as the Mortgage Constant, is a measure used in real estate finance to determine the annual debt service (principal and interest payments) payment required per dollar of the loan amount.
A loan servicer is a company responsible for collecting and managing loan payments, managing escrow accounts, and handling other administrative aspects of a loan portfolio.
Mortgage servicing involves the management of a mortgage loan, from collecting payments to ensuring that taxes and insurance are paid. It includes administrative tasks completed by a mortgage banker or a third-party servicer.
A performing loan is a loan on which the borrower is making the scheduled payments without default or breach of terms. Performing loans are contrasted with nonperforming loans where payments are overdue by 90 days or more.
A loan typically used outside the United States, whose payments are adjusted according to the rate of inflation, making payments predictable in terms of real value.
The act of curing a default by paying off all overdue loan payments and applicable penalties before a lender can initiate foreclosure proceedings.
A seasoned loan refers to a loan that has a history of timely payments made over a period of time, making it more attractive to investors.
