What type of mortgage is it (fixed rate, adjustable rate, FHA, VA, other)?
If it is an adjustable-rate mortgage (ARM):
- When is the first rate adjustment?
- What is the highest the rate could be at the first rate adjustment?
- What is the most the monthly payments (principal and interest) could be after the first rate adjustment and over the life of the loan?
What is the length of the loan (loan term)?
What is the starting or contract interest rate?
Can the balance you owe on the loan rise?
Does the loan payment include an escrow or reserve for taxes and insurance?
What is the estimated total monthly payment (principal, interest, taxes, insurance, PMI)?
What are the estimated fees and closing costs?
Does this loan have a prepayment penalty? If so, how much?
Source: The Federal Reserve, A Consumer’s Guide to Mortgage Refinancings, www.federalreserve.gov
