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What is a higher-priced mortgage loan?

April 26, 2017higher-priced mortgage loan

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What is a higher-priced mortgage loan?

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Prior to Maine mortgage laws being amended, the term “subprime mortgage loan” was used. That old term has now been replaced by the new term, “higher-priced mortgage loan.” A higher-priced mortgage loan is either a “non-traditional” mortgage loan (meaning, generally, a loan that allows a borrower to defer interest or principal), or a rate-spread mortgage loan, meaning that that the loan exceeds the average prime offer rate by 1.5 or more percentage points for loans secured by a first lien on a dwelling, or by 3.5 or more percentage points for loans secured by a subordinate lien on a dwelling.