Glossary

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Fixed Installment
A fixed installment is the monthly payment on a mortgage, which is calculated by the lender. It is based on several factors, including the price of the property, interest rate, down payment amount and the term of the loan. Fixed installments can vary greatly based on the term of the loan. For example, the fixed installment on a 30-year mortgage may be significantly less than a fixed installment on a 20-year mortgage. The borrower largely dictates how high or low the monthly payment is because one can choose to do a 20-year loan with higher payments or a 30-year loan with lower payments. Additionally, buyers who wish to stay within a strict monthly budget can convey this to the lender during the application process. The lender will then calculate the maximum loan amount based on the buyers preferred monthly payment.