Business, Legal & Accounting Glossary
Home mortgage loan in which the repayment begins with a relatively small amount, begins to rise slowly and, after some years, levels off to a fixed amount. It is designed for the young professionals and entrepreneurs whose incomes do not qualify them for the normal mortgages, but who can realistically expect continually growing incomes in the near future. In a 30-year graduated payment mortgage, the monthly installment amount starts at about 20% to 30% lower than a comparable fixed rate mortgage. This amount increases by 7% to 12% every year for about five years and then remains fixed for the next 25 years. The interest rate does not change during the entire period.
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This glossary post was last updated: 20th November, 2021 | 0 Views.