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Term life insurance covers individuals for a specific amount of time, for a predetermined dollar amount. This coverage serves as a safety net for a period of years and can provide financial security to those you love if something happens to you.
- Term life insurance covers you for an amount of time (term) you choose such as 10, 15, or 20 years. You pay a set dollar amount (the premium) month...
- Term life insurance covers you for a specific amount of time – 10, 15, or 20 years – for a predetermined dollar amount. It can be an affordable way...
- Your expenses and financial responsibilities change throughout your life and so will your coverage needs. Fidelity offers term life insurance in 10...
- The amount of coverage you get should reflect how much money you'd like your beneficiaries to receive in the event something happens to you. You ca...
- No, our term life policies have no cash value and no payout after the term expires. Our policies provide affordable life insurance coverage for a s...
- Many people seek help estimating how much term life coverage is needed and how much it might cost before applying. This is where the quote tool com...
- You can have multiple life insurance policies and some people have coverage through workplace and individual policies. However, having multiple ind...
- Your premiums are based on the policy value, term, your age, gender, and health status. Premium payments are level (will not change) throughout the...
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- Note: Letters of the alphabet without a relevant term are not listed.
- Adjustable-rate mortgage (ARM): A mortgage loan with an interest rate that can change throughout the loan’s lifetime.
- Agent: A real estate professional that is legally licensed to buy and sell property on behalf of their clients. An agent cannot operate independently, they must work under a licensed broker.
- Amortization: The process of gradually reducing mortgage loan debt over time by establishing scheduled monthly payments. The interest payment of an amortized loan will decrease as time goes on, while the principal payment will increase.
1 day ago · It hasn’t taken long for criticisms of the change to take shape. In particular, some have complained that applying IHT to pensions will result in that money being subject to a double taxation - resulting in potentially very high rates of tax. For example, where IHT is due, £100 of pension money would be subject to 40% IHT, leaving £60.
Fidelity Real Estate. A boutique real estate business within a global asset manager. Founded in 2006, Fidelity Real Estate runs solutions for a wide range of clients, providing direct access to high-quality property investments across the largest and most liquid markets in Europe and the UK.
- Introduction
- Adjustable Rate Mortgage
- Amortization
- Annual Depreciation Allowance
- Annual Percentage Rate
- Appraised Value
- Appreciation
- Building Classifications
- Capital Expenditures
- Capitalization Rate
Whether you are new to real estate investing or a seasoned expert, this article can help you understand basic to advanced real estate investing definitions. We will cover the most commonly researched real estate investment terms and their respective definitions. Our intent, is for you to use this real estate investing glossary as a quick, easy-to-u...
Definition
Adjustable Rate Mortgage (ARM) is a mortgage that does not have a fixed interest rate. An ARM can change monthly, based on benchmark interest rates. It’s typical for an ARM to have a fixed rate the first few years of the loan and then changes periodically.
Why It Matters
This is an important real estate investment definition to understand because mortgage payment amounts could fluctuate over the life of the loan due to market conditions. This fluctuation makes it difficult for investors to estimate their budget and potential return on investment.
Definition
Amortization is an accounting technique used to lower the cost value of a finite life or intangible asset incrementally through scheduled charges to income.
Why It Matters
Basically, amortization is how a mortgage is paid down over time. An amortized mortgage isn’t paid evenly over the life of the loan. Instead, each month a little more of your money goes toward the loan principal and less towards interest. Each mortgage payment goes toward a portion of the principal and a portion of the interest.
Definition
Annual Depreciation Allowance is the depreciation of an asset and how much an investor is allowed to deduct or write off every year according to tax code. This is basically the process of deducting costs related to buying and improving an asset or rental property. Instead of one large deduction during the year the property is bought or improved, depreciation deduction is distributed over the “useful life” of a property. Rental property that qualifies for depreciation allowance must meet the f...
Investor Tip
Residential property “useful life” term is 27.5 years, while nonresidential property is 39 years. Depreciation deductions are spread over these lengths of time.
Definition
Annual Percentage Rate (APR) is the annual rate charged for borrowing or earned through an investment. APR is expressed as a percentage that represents the actual yearly cost of funds over the term of a loan. This includes any fees or additional costs associated with the transaction but does not take compounding into account
Example of Calculating APR
Most APR’s are calculated as follows: U.S. Prime Rate + The margin the bank charges = APR
Definition
Appraised value is the evaluation of a property’s value.
Example of Appraised Value / Why It Matters
A professional appraiser is typically hired by the lender during the mortgage origination process and paid for by the borrower. The appraised value determines how much money may be borrowed and under what terms. Loan-to-Value (LTV) is determined by an appraisal.
Definition
Appreciation is the increase in the value of a property over time.
Examples of Appreciation
This happens for a few reasons, a rise in demand or a dip in supply, inflation or interest rate fluctuations. Appreciation also builds equity for the owner. Appreciation one of the top real estate definitions for investors to know.
Definition
Building classifications allow an investor to differentiate buildings and rationalize market data. Investment properties and their value falls into four category classifications, A, B, C or D.
Example of Building Classifications / Investor Tips
An “A” property is more expensive and in higher demand. “A” properties are generally newer, in great condition and in high-demand markets. Older, lower quality construction and in less-desirable areas are classified as B, C or D properties. New investors should consider “B” or “C” properties to balance risk versus reward. “A” properties may have more potential for higher monthly cash flow and return on investment, but the risk is often higher.
Definition
Capital Expenditures (CapEx) are any new purchases or major improvements made that increases the lifespan and value of a property. This also includes any equipment or supplies costs needed to make the improvements.
Examples of CapEx / Why It Matters
New roof, new furnace, new floors, renovating a bathroom, etc. This does not apply to smaller maintenance expenses like, painting, a leaky pipe or carpet cleaning. Capital Expenditures and routine maintenance are taxed differently, so it’s important for investors to understand the difference and list them appropriately on tax forms.
Definition
Capitalization Rate is calculated by the Net Operating Income or NOI (defined below) divided by sale price or value of a property.
Investor Tip
This metric helps buyers determine their expected return on investment, prior to factoring in mortgage financing. A low Cap Rate usually comes with lower risk.
May 22, 2024 · For many investors, real estate investment trusts (REITs) and/or real estate-focused mutual funds or ETFs might provide a more beginner-friendly way to get started. Investing in real estate is often touted as a way to potentially earn extra income and help build wealth over time.
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3 days ago · Policy maturity happens when a life insurance policy reaches the end of its term, the insured person dies, or when the insured person reaches a certain age specified in the policy. If you have a permanent life insurance policy and you reach an age specified in the policy, the policy might pay out a sum of money to you.
