In a mortgage, term is the length of time a lender agrees to lend its money.  It is also the length of time for which the loan’s interest rate is “guaranteed.”

Put another way, term is the length of one’s mortgage agreement.

The term is usually shorter than the amortization period.

At the end of the term the outstanding debt must either be refinanced at current market rates or paid off in full.

Last modified: November 19, 2008