Finance
What is a 'bridge loan' in Oregon real estate?
AA long-term fixed-rate mortgage for bridge construction projects
BShort-term financing that helps a buyer purchase a new home before their existing home sells✓ Correct
CA government-backed loan for low-income buyers
DA loan specifically for commercial bridge structures
Explanation
A bridge loan is short-term financing that allows a homebuyer to purchase a new property before their current home sells, using the equity in the existing home as collateral. Bridge loans carry higher interest rates and are repaid when the existing home closes.
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Key Terms to Know
Amortization
The gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
Math Concepts
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