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When you’re starting to apply for home loans, you’ll come across some financial terms during your research. While you might be familiar with a few words and phrases, there could also be a couple of confusing ones too. Loan jargon isn’t a part of everyone’s vocabulary, which is why we have written down terms that might be helpful on your loan application journey!


A quick way for lenders to tell you what kind of loan, if any, you may qualify for. It’s important not to confuse prequalification with preapproval, which is a more formal commitment from a lender and often requires additional documentation.

Net Income

Your take-home pay after taxes and other deductions, such as health insurance. Simply, this is the amount you see on your paycheck. Note: your net income is different from your gross income, which is your wages without any deductions.


A cosigner is someone who signs for your loan with you. If your credit score isn’t high enough, a cosigner, which is essentially someone who is legally obligated to repay your loan if you’re unable to, may be a way to get the money you need.


This stands for annual percentage rate. An APR includes your interest rate, but also wraps in things like one-time charges and annual fees. You can use an online loan calculator to determine how APR can affect your monthly payments.

Debt Consolidation

If a lender mentions debt consolidation, this means a combination of debts into a single loan. Anything from credit cards to house bills is included.


At American Mortgage Resource, Inc., we make the loan application process simple. If you have any questions about our programs or lending options, visit our website for more information. You can also contact our team by calling 617-972-8588. Get approved today!