residential financing

Residential financing refers to the process of obtaining a loan to purchase or refinance a home. Typically, lenders provide these loans—called mortgages—based on the buyer’s ability to repay, considering factors like income, credit history, and the property’s value. The borrower agrees to make regular payments over time, which cover principal and interest. Lenders may also require an initial upfront payment, known as a down payment. The property acts as collateral, meaning if the borrower defaults, the lender can seize and sell the home to recover the loan amount. This process makes homeownership accessible by spreading the cost over many years.