Teaser Loan

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Dictionary Says

Definition of 'Teaser Loan'

An adjustable-rate mortgage loan in which the borrower pays a very low initial interest rate, which increases after a few years. Teaser loans try to entice borrowers by offering an artificially low rate and small down payments, claiming that borrowers should be able to refinance before the increases occur.
Investopedia Says

Investopedia explains 'Teaser Loan'

Teaser loans are considered an aspect of subprime lending, as they are usually offered to low-income home buyers. Unfortunately, when these borrowers try to refinance the loan before the rate increases, most will not qualify for standard mortgages. This leaves borrowers with increased monthly payments, which many cannot afford. This method of loaning is considered risky, as default rates are high.
Search results for

'Teaser Loan'

  • The Fuel That Fed The Subprime Meltdown

    http://www.investopedia.com/articles/07/subprime-overview.asp
    ... Dream Or Mortgage Nightmare?) As the real estate market pushed to its peaks in 2005
    and 2006, teaser rates, ARMs, and the "interest-only" loan (where no ...

  • Homebuyers' Walkthrough: Which Type Of Mortgage Is Best? ...

    http://www.investopedia.com/university/homebuyers-walkthrough/homebuyers-walkthrough4.asp
    ... The introductory loan interest rate - commonly called a teaser rate - is often
    lower than the rate available on a fixed-rate mortgage. ...

  • Mortgage Basics: Variable-Rate Mortgages | Investopedia

    http://www.investopedia.com/university/mortgage/mortgage2.asp
    ... effect. This is commonly referred to as an introductory, or teaser, rate.
    This time period varies depending on the loan. After this ...

  • 3 New Types Of Credit Cards To Look For - Investopedia.com

    http://financialedge.investopedia.com/financial-edge/0112/3-New-Types-Of-Credit-Cards-To-Look-For.aspx
    ... Credit card companies often use teaser rates to draw you in and then they
    bump the rate higher after the introductory period is over. ...

  • 7 Low-Rate Mortgage Shams - Investopedia.com

    http://financialedge.investopedia.com/financial-edge/0709/7-Ways-To-Avoid-Low-Rate-Mortgage-Shams.aspx
    ... Teaser Rates These attractively low advertised interest rates are often just a way
    to ... Type of Loan What type of loan you qualify for will affect your interest ...

  • This ARM Has Teeth

    http://www.investopedia.com/articles/pf/07/arm-reset.asp
    ... a low teaser rate of 1.5%. Your initial minimum monthly payment would be only $862.80 -
    very affordable. But, the fully amortized payment at the loan's indexed ...

  • 5 New Ways Credit Card Companies Are Wooing New Card Holders ...

    http://financialedge.investopedia.com/financial-edge/0111/5-New-Ways-Credit-Card-Companies-Are-Wooing-New-Card-Holders.aspx
    ... disappear. Not so - with the low prime rate, cards with that nice "teaser"
    rate are still being offered by many companies. There ...

  • Credit And Debt Management: Credit Cards | Investopedia

    http://www.investopedia.com/university/credit-debt-management/management4.asp
    ... Teaser rates especially seem to shock these new consumers. ... $30K HELOC, 4.59%, 4.60%.
    $30K Home Equity Loan, 5.74%, 5.77%. $50K Home Equity Loan, 5.45%, 5.50%. ...

  • The Rise And Fall Of The Shadow Banking System

    http://www.investopedia.com/articles/economics/10/shadow-banking-system.asp
    ... obligations (CDO), mortgage-backed securities (MBS) and collateralized loan obligations
    (CLO). ... payments on their mortgages that exceeded the initial teaser rate ...

  • Retirement Planning For 30-Somethings: Managing Your Credit Score ...

    http://www.investopedia.com/university/retirement-30/retirement-306.asp
    ... If you are able to get such a loan at a favorable interest rate, it may make ... agreement
    terms to ensure that the rate you receive is not just a teaser rate that ...

Related Articles

Bank Rates
Product Today Last Wk
$10K MMA 0.50% 0.51%
MMA 0.45% 0.46%
6 Month CD 0.46% 0.47%
1 Year CD 0.70% 0.75%
5 Year CD 1.46% 1.46%
1 Year Jumbo CD 0.66% 0.67%
Rate data provided by Bankrate
Product Today Last Wk
$30K HELOC 4.59% 4.60%
$30K Home Equity Loan 5.74% 5.77%
$50K Home Equity Loan 5.45% 5.50%
$50K HELOC 4.24% 4.24%
$100K Home Equity Loan 5.41% 5.46%
$100K HELOC 4.13% 4.13%
Rate data provided by Bankrate
Product Today Last Wk
30 Year Fixed 3.80% 3.80%
15 Year Fixed 3.09% 3.11%
1 Year ARM 3.54% 3.53%
30 Year Fixed Jumbo 4.38% 4.38%
5/1 ARM 2.65% 2.69%
3/1 ARM 2.69% 2.69%
Rate data provided by Bankrate
Product Today Last Wk
60 Month Used Car Loan 4.51% 4.51%
48 Month Used Car Loan 4.35% 4.35%
48 Month New Car Loan 3.24% 3.24%
36 Month Used Car Loan 4.34% 4.36%
36 Month New Car Loan 3.11% 3.13%
60 Month New Car Loan 3.35% 3.34%
Rate data provided by Bankrate
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