- Income Property
Real estate developed or improved to produce income.
- Index
A number used to compute the interest rate for an
adjustable-rate mortgage (ARM). The index is generally a published number or
percentage, such as the average interest rate or yield on Treasury bills. A
margin is added to the index to determine the interest rate that will be
charged on the ARM. Some lenders provide caps that limit how much the interest
rate or loan payments may increase or decrease.
- Inflation
An increase in the amount of money or credit available
in relation to the amount of goods or services available, which causes an
increase in the general price level of goods and services. Over time, inflation
reduces the purchasing power of a dollar, making it worth less.
- Initial Draw Amount
The amount of the home equity line of credit that the
borrower is requesting at closing (up to, but never exceeding, the credit line
amount).
- Installment Loan
Borrowed money that is repaid in equal payments, known
as installments. A furniture loan is often paid for as an installment loan.
- Insurable Title
A property title that a title insurance company agrees
to insure against defects and disputes.
- Insurance
A contract that provides compensation for specific
losses in exchange for a periodic payment. An individual contract is known as
an insurance policy, and the periodic payment is known as an insurance premium.
- Insurance Binder
A document that states that insurance is temporarily
in effect. Because the coverage will expire by a specified date, a permanent
policy must be obtained before the expiration date.
- Insured Mortgage
A mortgage that is protected by the Federal Housing
Administration (FHA) or by private mortgage insurance (PMI). If the borrower
defaults on the loan, the insurer must pay the lender the lesser of the loss
incurred or the insured amount.
- Interest
The fee charged for borrowing money.
- Interest accrual rate
The percentage rate at which interest accrues on the
mortgage. In most cases, it is also the rate used to calculate the monthly
payments.
- Interest Cap
- A
consumer safeguard that limits the amount the interest rate on an
adjustable-rate mortgage may change per year and/or over the life of the loan.
- Interest Payment
The portion of a monthly payment that goes to interest
based on the amortization schedule.
- Interest Rate
The percentage rate of return charged for use of a sum
of money. This percentage rate is specified in the mortgage note. See note
rate.
- Investment Property
A property that is not occupied by
the owner and is generally rented to a tenant to produce income.
Loan Glossary 
