Mortgage glossary

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Income: Any money that you receive in a given period of time. For the purposes of obtaining a mortgage you should consider your steady monthly income when determining your affordable mortgage payment amounts. You may not want to include income such as child support, interest on investments, or other variable amount types of income.

Index: a measurement used by lenders to determine changes to the Interest rate charged on an adjustable rate mortgage.

Individual Savings Account (ISA): the Government's tax-free saving scheme. You can make financial provisions for the future by putting money into any of three types of investment - cash savings, stocks and shares and life assurance. FFI mortgage glossary.

Inflation: the number of dollars in circulation exceeds the amount of goods and services available for purchase; inflation results in a decrease in the dollar's value.

Initial interest: any payment due for the period from the day the mortgage began up to the first payment date.

Interest: a fee charged for the use of money .

Interest only mortgage: you only repay the interest each month. The original capital balance will remain outstanding at the end of your mortgage term.

Interest rate: the amount of interest charged on a monthly loan payment; usually expressed as a percentage.

Interest Rate Reduction Refinancing Loan: This is a VA mortgage loan that takes mortgages in the VA Home Loan Guarantee Program and allows the owner to refinance the loan for a lower interest rate. The loan can be an adjustable rate mortgage refinanced to a fixed rate mortgage or a fixed rate mortgage refinanced to a fixed rate mortgage as long as the interest rate is lower and your monthly mortgage payment decreases. The VA does not allow you to take cash out of an IRRRL, but you may finance to pay for energy efficient home improvements or to take advantage of lower interest rate trends in the market. FFI mortgage glossary.

Intermediary: a mortgage broker or advisor who finds the most suitable mortgage for a borrower and arranges the mortgage on their behalf.

Intermediate-term mortgage: a mortgage loan with a contractual maturity at the time of purchase equal to or less than 15 years.

Insolvency policy: C&G would insist on an insolvency policy where there has been a sale at an undervalue (where someone has sold their property for less than it's worth). If there is a sale at an undervalue, and the seller is later declared bankrupt, previous transactions are looked at again, and it is possible that a sale at an undervalue would be declared void. C&G would therefore insist on the policy to protect our security. An Insolvency Policy may also be required in the case of a transfer and gift as well as a sale. FFI mortgage glossary.

Insurance: protection against a specific loss over a period of time that is secured by the payment of a regularly scheduled premium.

Investor: the actual source of money for the mortgage.

Impound: that portion of a borrower's monthly payments held by the lender or servicer to pay for taxes, hazard insurance, mortgage insurance, lease payments and other items as they become due.