HELOC EXPERT GLOSSARY

Glossary: I

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Terms Starting with I

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A published benchmark used in the interest-rate formula for many adjustable-rate loans and HELOCs.

A published benchmark used with a margin to determine the interest rate on many adjustable-rate products.

An amount some HELOC lenders may require or permit the borrower to draw at or shortly after closing.

The process by which interest accumulates on an outstanding loan balance over time.

The percentage used to calculate interest charged on a loan balance.

The minimum interest rate allowed under some variable-rate loan agreements.

The possibility that borrowing costs or asset values change as market interest rates change.

Funds set aside to make scheduled interest payments, generally in specialized lending structures.

A payment that covers interest due without scheduled reduction of principal, if permitted by the loan terms.

Real estate owned primarily for rental income, appreciation or investment rather than as the owner’s primary residence.