Lenders Mortgage Insurance

# Insurance written by an independent mortgage insurance company protecting the mortgage lender against loss incurred by a mortgage default. Usually required for loans with an LVR of 80.01% or higher. (see press release article)

# Lenders Mortgage Insurance (LMI), also known as Private Mortgage Insurance (PMI), is insurance payable to a lender when taking out a mortgage. It is an insurance in the case that the mortgagor is not able to repay the loan, and the lender is not able to recover its costs after foreclosing the loan and selling the mortgaged property.

FHA Mortgage Insurance

# Requires a fee paid at closing or a portions of this feed added to each monthly payment of an FHA loan to insure the loan with FHA

# Requires a fee (up to 2.25 percent of the loan amount) paid at closing to insure the loan with FHA. In addition, FHA mortgage insurance requires an annual fee of up to 0.5 percent of the current loan amount, paid in monthly installments. The lower the down payment, the more years the fee must be paid.

# The Federal Housing Administration, a government agency, provides insurance on some types of mortgage loans. An FHA-insured loan also allows you to buy a house with a low down payment, ranging from 3%-5% depending on the price of the home. The buyer pays a one-time fee of 3.8% of the loan amount for the mortgage insurance premium at closing time, and there is an additional annual fee for low down

MIP:Mortgage Insurance Premium

MIP is one-half percent borrowers pay each month on FHA insured mortgage loans. It is insurance from FHA to the lender against incurring a less due to the borrower’s default. On September 1, 1983 the MIP was changed to a one-time charge to borrowers.

Mortgage Insurance Premium

# The fee paid by a borrower to FHA or a private insurer for mortgage insurance.

# a monthly payment -usually part of the mortgage payment - paid by a borrower for mortgage insurance.

# The payment made by a borrower to the lender for transmittal to HUD. These payments help defray the cost of the FHA mortgage insurance program and provide a reserve fund to protect lenders against loss in insured mortgage transactions. In FHA insured mortgages, this represents an annual rate of one-half of 1 percent paid by the borrower on a monthly basis.

# The amount paid by a mortgagor for mortgage insurance, either to a government agency such as the Federal Housing Administration (FHA) or to a private mortgage insurance (MI) company.

# Insurance purchased by borrower to insure against default on government (FHA or VA) loans.

# Insurance from FHA to the lender against incurring a loss on account of the borrower's default.

# The charge paid by the borrower to cover the cost of a mortgage insurance policy under an FI-L4 insured mortgage. The insurance policy provides protection for all or a certain percentage of the loan amount to the lender in case of default by the borrower. Historically the premium was paid each month as part of the mortgage payment; but, in recent years it has been paid either in cash at closing or financed and repaid as part of the total amount borrowed. Back to top -- View Real Estate Listings

# The mortgage insurance required on FHA loans for the life of said loans; MIP can either be paid in cash at closing or financed in its entirety in the loan. The premium varies depending on the method of payment.

# The consideration paid by a mortgagor for mortgage insurance either to FHA or a private mortgage insurance (PMI) company. This insurance protects the investor from possible loss in the event of a borrower's default on a loan.

# Money paid by the borrower in an FHA loan and used to insure the loan.

# Mortgage insurance protects the lender from loss due to payment default by the borrower. With this insurance protection, the lender is willing to make a larger loan, thus reducing downpayment requirements. This type of insurance should not be confused with mortgage life, credit life or disability insurance designed to pay off a mortgage in the event of physical disability or death of the borrower. ...

# ): Payment made to HUD on an FHA loan. These monies provide a reserve fund to protect the lenders against loss. Paid monthly, and calculated as, .5% multiplied by the loan amount and divided by 12-months.

# A charge paid by the borrower (usually as part of the closing costs) to obtain financing, especially when making a down payment of less than 20 percent of the purchase price, for example on an FHA-insured loan.

# The premium paid by a borrower either to FHA (FHA/VA loans) or to a private company for non-government insured loans.

# FHA insures lenders against loss on FHA loans. The premium can be paid up front or financed as part of the loan.

# The insurance issued by a government agency such as the FHA

# A contract that guarantees the lender against loss caused by the mortgagor's default on a government or conventional loan.

Seller Assisted Second Mortgage

The seller of the house lends the buyer enough to make up the difference between the purchase price and the down payment plus first-mortgage balance (a commercial lender may also make this kind of loan). The terms including the interest rate, are based on buyer/seller agreement. It is often a short-term (5 to 15 year) loan; sometimes "interest only" payments until the term date when the balance is due in full. A buyer can then refinance the home.

Second Mortgage Market

# The buying and selling of existing mortgages.

subsidized second mortgage

# An alternative financing option for low- and moderate-income households that also includes a down payment and a first mortgage, with funds for the second mortgage provided by city, county, or state housing agencies, foundations, or nonprofit corporations. Payment on the second mortgage is often deferred, carries no or low interest rates, and part of the debt may be forgiven for each year the family remains in the home.

First and Second Mortgage

# 1st mortgages have 1st position on a property and 2nd mortgages have 2nd position on a property.

PMI Private Mortgage Insurance

# Insurance similar to FHA or VA insurance, insuring part of the first mortgage or deed of trust, enabling a lender to make a conventional loan of a higher percentage of the property value.

# Required on Fannie Mae/Freddie Mac, FHA/VA products where LTV exceeds 80%.

Private Mortgage Insurance

# Insurance to protect the lender in case the borrower defaults on his/her loan.

# Mortgage insurance that protects lenders from a loss if the buyer defaults.

# Insurance against a loss by a lender in the event of default by a borrower (mortgagor). The insurance is similar to insurance by a governmental agency such as FHA, except that it is issued by a private insurance company. The premium is paid by the borrower and is included in the mortgage payment.

# Insurance provided by a private company helping to protect the mortgage lender against mortgage default. Generally, this insurance is required by the lender when the down payment is less than 20'% of the properly value. The tender requires the borrower to pay the insurance premiums.

# In the event that you do not have a 20 percent down payment, lenders will allow a smaller down payment - as low as 5 percent in some cases. With the smaller down payment loans, however, borrowers are usually required to carry private mortgage insurance. Private mortgage insurance will usually require an initial premium payment and may require an additional monthly fee depending on you loan's structure.

# protects the lender against a loss if a borrower defaults on the loan. It is usually required for loans in which the down payment is less than 20 percent of the sales price or, in a refinancing, when the amount financed is greater than 80 percent of the appraised value.

# Insurance provided by a non-governmental insurer that protects lenders against a loss if a borrower defaults. Usually required on all loans with an "LTV" of more than 80%.

# Insurance written by a private mortgage insurance company protecting the mortgage lender against loss occasioned by a mortgage default and foreclosure.

# Insurance provided by nongovernment insurers that protects lenders against loss if a borrower defaults. Fannie Mae generally requires private mortgage insurance for loans with loan-to-value (LTV) percentages greater than 80%.

# Monthly insurance cost which borrowers must pay on loans which exceed 80% of the home’s value

# Mortgage insurance that is provided by a private mortgage insurance company to protect lenders against loss if a borrower defaults. Most lenders generally require MI for a loan with a loan-to-value (LTV) percentage in excess of 80 percent.

# This is insurance that protects a mortgage lender against default on a loan. Generally, if the down payment on a mortgage loan is less than 20%, private mortgage insurance is required.

# Insurance provided by nongovernment insurers that protects lenders against loss if a borrower defaults.

# May be required by your Lender if the loan you apply for cannot be granted because the loan does not meet the normal standards for the Lender. The most common reason for this requirement is a smaller down payment than the Lender usually requires which is around 20%. This insurance protects the Lender from loss if the Borrower defaults. It does not protect the Borrower, though it may allow the Borrower to qualify for a loan they could not otherwise get. ...

# Insurance issued to a lender to protect it against loss on a defaulted mortgage loan. Its use is usually limited to loans with high loan-to-value ratios, generally in excess of 80%. The borrower pays the premiums.

# Required on virtually all conventional loans with less than 20% downpayment. Although the payments for PMI are included in your mortgage payment, it protects the lender should you default on the loan. On FHA loans, you will pay a MIP (Mortgage Insurance Premium) which accomplishes the same purpose.

# An insurance policy the borrower buys to protect the lender from non-payment of the loan. Private mortgage insurance policies are usually required if you make a down payment that is below 20% of the appraised value of the home.

# Paid by a borrower to protect the lender in case of default. PMI is typically charged to the borrower when the Loan-to-Value Ratio is greater than 80%.

# Protection for lenders against borrower default. Paid for by the borrower and usually required when the down payment is less than 20% of the purchase price.

# Insurance written by a private company protecting the mortgage lender against a financial loss in the event of mortgage default by the borrower for loans with high LTV ratios. PMI is generally required of a borrower whose down payment is less than 20% of the total loan.

# A type of insurance which protects the lender in the event the borrower defaults on the loan. PMI is generally required where a borrower is unable to produce a down payment equal to at least 20% of the total purchase price. The premium for PMI is paid by the borrower and is included in each monthly mortgage payment.

# (PMI): Insurance the buyer carries to guarantee that the lender is paid off if the buyer defaults (fails to pay) on a mortgage. This is different from homeowner's insurance. It is generally required for all mortgages with less than a twenty percent down payment. The exact amount depends on the amount of the loan and the size of the down payment.

# Insurance guaranteeing the payment of a loan. This type of mortgage insurance is normally charged when the loan exceeds 80% of the property value.

# Insurance written by a private company protecting the lender against financial loss if the borrower defaults on the mortgage.

# A form of insurance required by a lender when the borrower's down payment or home equity percentage is less than 20 percent of the home value. This insurance partially protects the lender if the borrower defaults on the loan.

# PMI is Private Mortgage Insurance. It is generally required in the U.S. for home loans which are greater than 80% of the purchase price of the home. PMI can be avoided by receiving an alternate form of housing such as an 80/20.

Non Conventional Mortgage Loan

# A mortgage loan that does not conform to agency-established limits such as loan to value ratio, term, and other characteristics. Usually the regulatory limits are set by Fannie Mae, Freddie Mac and other government established guidelines.

Conventional Mortgage Loan

# A mortgage loan up to a maximum of 75% of the lending value of the property. Mortgage loan insurance is not required for this type of mortgage. Covenant A clause in a legal document which, in the case of a mortgage, gives the parties to the mortgage a right or an obligation. For example, a covenant can impose the obligation on a borrower to make mortgage payments in certain amounts on certain dates. A mortgage document consists of covenants agreed to by the borrower and the lender.

# a fixed- or adjustable-rate, fully amortized loan secured by a mortgage or deed of trust that is not insured or guaranteed by an agency of the federal government (such as FHA or VA).

# A first mortgage where the amount can not be more than 75% of the appraised property value.

# A mortgage loan which is not guaranteed by the federal government (HUD/Federal Housing Administration, Veterans Affairs, Agriculture/Rural Development) and which is either underwritten to conservative loan to value ratios or includes a Primary Mortgage Insurance Policy.

Conventional Mortgage

# A first mortgage granted by an institutional lender such as a bank or trust company, where the amount of the loan does not exceed 75% of the lending value of the property.

# A mortgage not obtained under a government insured program (such as FHA or VA).

# Usually refers to a fixed-rate, 30-year mortgage that is not insured by the FHA, Farmers Home Administration (FmHA) or Veterans Administration.

# Refers to home loans other than government loans (VA and FHA).

# A mortgage loan up to a maximum of 75% of the lending value of the property. Mortgage loan insurance is not required for this type of mortgage.

# A mortgage that is not insured or guaranteed by the federal government.

# A loan neither insured by the FHA nor guaranteed by the VA.

# A mortgage loan that is made without FHA insurance, USDA insurance, state bond insurance or VA guarantee.

# A mortgage loan not insured by HUD or guaranteed by the Veterans' Administration. It is subject to conditions established by the lending institution and state statutes. The mortgage rates may vary with different institutions and between states. (States have various interest limits.)

# A mortgage securing a loan made by investors without governmental underwriting, ie, which is not FHA insured or VA guaranteed.

# A mortgage where the loan does not exceed 75% of the value of the property.

# A mortgage that does not exceed 75% of the appraisal value or purchase price of the property, whichever is lower. Mortgage loan insurance is not required for this type of mortgage. BACK TO TOP

# A permanent, long-term loan made by institutional lenders, mortgage companies and private individuals which is not insured by the Federal Housing Administration or the Veterans Administration.

# A type of mortgage not insured by either the Federal Housing Administration (FHA) or the Department of Veterans Affairs (VA).

# A mortgage that is not insured or guaranteed by a government agency.

# A mortgage that is 75% or less of the value of the property.

# A mortgage loan that is obtained without any additional guarantees for repayment, such as FHA insurance, VA guarantees, or private insurance. This is usually given at an 80% loan-to-value ratio.

# A first mortgage issued for up to 75 per cent of the property's appraised value or purchase price, whichever is lower.

# A home loan that follows a fixed rate.

# A regular loan that may be privately insured, but is not insured or guaranteed by the government.

# A home loan that follows a fixed rate. It's neither guaranteed nor insured by the Federal Housing Administration (FHA) or Department of Veterans' Affairs (VA).

# A mortgage loan that is 75 per cent or less of the loan-to-value ratio; and does not require insurance by CMHC or other private insurer.

# Common security device used to purchase a home by transferring to the bank or other financial institution a lien or legal title in return for the price or part of the price of the home.

# Most popular home financing form not insured by FHA or guaranteed by VA. Available from many lenders at varying rates, terms and conditions.

# A mortgage loan made by a financial institution without insurance or guarantee by a high-ratio default insurer (eg. CMHC or Genworth). It’s called conventional because it conforms to acceptable Loan to Value (LTV) margins, usually 75% of the value of the property.

conventional mortgage

# A first mortgage granted by an institutional lender such as a bank or trust company, where the amount of the loan does not exceed 75% of the lending value of the property.

# A mortgage not obtained under a government insured program (such as FHA or VA).

# Usually refers to a fixed-rate, 30-year mortgage that is not insured by the FHA, Farmers Home Administration (FmHA) or Veterans Administration.

# Refers to home loans other than government loans (VA and FHA).

# A mortgage loan up to a maximum of 75% of the lending value of the property. Mortgage loan insurance is not required for this type of mortgage.

# A mortgage that is not insured or guaranteed by the federal government.

# A loan neither insured by the FHA nor guaranteed by the VA.

# A mortgage loan that is made without FHA insurance, USDA insurance, state bond insurance or VA guarantee.

# A mortgage loan not insured by HUD or guaranteed by the Veterans' Administration. It is subject to conditions established by the lending institution and state statutes. The mortgage rates may vary with different institutions and between states. (States have various interest limits.)

# A mortgage securing a loan made by investors without governmental underwriting, ie, which is not FHA insured or VA guaranteed.

# A mortgage where the loan does not exceed 75% of the value of the property.

# A mortgage that does not exceed 75% of the appraisal value or purchase price of the property, whichever is lower. Mortgage loan insurance is not required for this type of mortgage. BACK TO TOP

# A permanent, long-term loan made by institutional lenders, mortgage companies and private individuals which is not insured by the Federal Housing Administration or the Veterans Administration.

# A type of mortgage not insured by either the Federal Housing Administration (FHA) or the Department of Veterans Affairs (VA).

# A mortgage that is not insured or guaranteed by a government agency.

# A mortgage that is 75% or less of the value of the property.

# A mortgage loan that is obtained without any additional guarantees for repayment, such as FHA insurance, VA guarantees, or private insurance. This is usually given at an 80% loan-to-value ratio.

# A first mortgage issued for up to 75 per cent of the property's appraised value or purchase price, whichever is lower.

# A home loan that follows a fixed rate.

# A regular loan that may be privately insured, but is not insured or guaranteed by the government.

# A home loan that follows a fixed rate. It's neither guaranteed nor insured by the Federal Housing Administration (FHA) or Department of Veterans' Affairs (VA).

# A mortgage loan that is 75 per cent or less of the loan-to-value ratio; and does not require insurance by CMHC or other private insurer.

# Common security device used to purchase a home by transferring to the bank or other financial institution a lien or legal title in return for the price or part of the price of the home.

# Most popular home financing form not insured by FHA or guaranteed by VA. Available from many lenders at varying rates, terms and conditions.

# A mortgage loan made by a financial institution without insurance or guarantee by a high-ratio default insurer (eg. CMHC or Genworth). It’s called conventional because it conforms to acceptable Loan to Value (LTV) margins, usually 75% of the value of the property.

Adjustable Rate Mortgage

# An adjustable rate mortgage is a mortgage in which the interest changes periodically, according to corresponding fluctuations in an index. All ARMs are tied to indexes.

# A mortgage loan with an interest rate subject to change over the term of the loan. The interest rate is tied to the performance of a specified market rate, such as the cost of funds index calculated by the 11th District of the Federal Home Loan Bank Board, or the yields on one-year or six-month US Treasury securities.

# A mortgage that changes interest rate periodically based upon the changes in a specified index.

# A mortgage whose interest rate changes over time based on an index.

# A mortgage that permits the lender to adjust its interest rate periodically on the basis of changes in a specified index.

# Is a mortgage in which the interest rate is adjusted periodically based on a preselected index. Also sometimes known as the re negotiable rate mortgage, the variable rate mortgage or the Canadian rollover mortgage.

# A mortgage in which the rate of interest is adjusted based on a standard rate index. Most ARMs have a cap on how much the interest rate may increase.

# A mortgage where the interest rate is not fixed, but changes during the life of the loan, in line with movements of the index rate.

# A loan with an interest rate that changes periodically in keeping with a current index. Typically ARMs don't jump more than two percentage points per year or six points above the staring point.

# A mortgage with an interest rate that changes periodically, according to an index that is selected when the mortgage is issued. The initial interest rate is lower than that for fixed-rate mortgages, but monthly payments can go up or down when the rate is adjusted.

# A loan with an interest rate that is periodically adjusted to reflect changes in a specified financial index.

# A mortgage with interest rates that may fluctuate based on market conditions; the lender is permitted to adjust the mortgage's interest rate periodically, though most ARM's are limited in the amount that the interest rates can vary

# A mortgage in which the interest rate increases or decreases over the life of the loan based on market conditions, resulting in possible changes in monthly payments. Some plans have rate caps that limit the amount your interest rate may change. This loan, which has many variations, generally carries a lower initial rate than a fixed-rate loan because the borrower assumes the risk of the rising or falling market.

# A mortgage loan where the interest rate is adjusted based on a standard rate index.

# (ARM): This has also been called a variable rate mortgage. This is a mortgage whose interest rate changes at specific times stated in the note. This rate change is based on the original note rate and an index and a margin. The rate changes are made at prescribed times and within prescribed limits (also called caps) as defined by the note and any attachments to the note.

# A mortgage that allows the lender to adjust its interest rate at specific intervals based on changes in an established index.

# With adjustable-rate mortgages (commonly called ARMs), the interest rate changes over time according to terms specified in advance by the lender. The initial interest rate is usually lower than that offered with a fixed-rate mortgage. This means that the monthly repayment amount would also be lower. At predetermined times, the interest rate will be adjusted either up or down. Consequently, the monthly payment amount will also increase or decrease. ...

# A mortgage characterized by a fluctuating interest rate, usually one tied to a bank or savings and loan association cost-of-funds index.

# A loan in which the interest rate changes periodically in line with an index.

# (ARM): A mortgage loan in which the interest rate can go up or down based on market conditions. Changes in the interest rate are determined by a financial index.

# A loan with an interest rate adjusted periodically, typically at one-year intervals. One-year ARMs adjust every year, but three-, five- and seven-year ARMs don't adjust until those periods are up, and typically every year after that. The adjustments depend on movements of any number of financial market indexes, including the prime rate.

# A mortgage whose interest rate changes periodically based on the changes in a specified index. 3/1, 5/1, 7/1 and 10/1 are ARMs in which rate is fixed for three-year, five-year, seven-year and 10-year periods, respectively, but may adjust annually after that.

# A mortgage loan that has an adjustable rate.

# A mortgage loan with an interest rate and payments that are subject to change periodically over the life of the loan.

# Loan whose interest rate is adjusted according to movements in the financial market. Many offer lower-than-market initial Interest rates that rise only gradually for the first few years.

Balloon Mortgage

A balloon mortgage is one in which monthly payments are made for a specified period of time, with the balance of the loan paid in full at the end of the loan term. Like an ARM, interest rates on a balloon mortgage are typically lower than on a fixed rate mortgage.

A mortgage loan that requires the remaining principal balance be paid at a specific point in time. For example, a loan may be amortized as if it would be paid over a thirty year period, but requires that at the end of the tenth year the entire remaining balance must be paid.

A mortgage that has level monthly payments that are insufficient to fully amortize the principal and interest within the term of the loan. With a balloon mortgage, a lump sum payment ("Balloon Payment") is due at maturity.

A short-term fixed-rate loan which features small payments for a certain period of time and one large payment for the remaining amount of the principal (balloon payment), paid at the time of the final installment.

a mortgage that typically offers low rates for an initial period of time (usually 5, 7, or 10) years; after that time period elapses, the balance is due or is refinanced by the borrower.

A mortgage that has level monthly payments that will amortize it over a stated term but that provides for a lump sum payment to be due at the end of an earlier specified term.

A mortgage with periodic installments of principal and interest that do not fully amortize the loan. The balance of the mortgage is due in a lump sum at a specified date, usually at the end of the term.

A real estate loan in which some portion of the debt will remain unpaid at the end of the term of the loan. A balloon will usually result in a single large payment due when the loan ends.

a mortgage that does not fully amortize by the end of the loan term. Periodic payments may be for principal and interest, or for interest only. At maturity, the unpaid principal is due in a lump sum.

A short-term, fixed-rate loan with low payments for a set number of years and a large balloon payment of the remainder of the principal due at the end of the term.

A loan that has regular monthly payments which amortize over a stated term but call for a final lump sum (balloon payment) at the end of a specified term, or maturity date, such as 10 years.

A mortgage that has a substantial amount of the principal due at the maturity of the note.

A mortgage for a fixed term shorter than necessary to fully repay the debt. As a result, the remaining amount of principal is due at the maturity of the loan.

A mortgage whose amortization schedule will not extinguish the debt by the end of the mortgage term, leaving a large payment (called balloon payment) of the remaining principal balance to be paid at that time.

Behaves like a fixed-rate mortgage for a set number of years (usually five or seven) and then must be paid off in full in a single "balloon" payment. Balloon loans are popular with those expecting to sell or refinance their property within a definite period of time.

A type of mortgage loan that is exactly like a traditional fixed rate mortgage except that it becomes 100% due after a specified amount of time has elapsed (usually five or seven years). When the loan matures, you must pay the loan off in cash (Balloon Payment) or refinance. The advantage of this type of loan is that the initial rate is usually lower than a normal fixed rate loan. ...

A mortgage that requires that a final lump sum payment be paid at the end of the loan term.

A balloon mortgage offers lower interest rates for shorter-term financing, usually five, seven or ten years. At the end of this term, the borrower requires refinancing or must pay off the outstanding balance in a lump-sum (balloon) payment.

Type of mortgage home loan structured whereby the borrower makes consistently, regular payments up until the end of the term when a sizably, large final payment (balloon payment) comes due in conjunction with the loan's maturity date.

A mortgage loan with periodic payments that are insufficient to fully amortize the face amount of the note prior to maturity, so that the principal sum, known as the "balloon" is due at maturity.

A large payment on a mortgage due at the end of a certain time period.

A short term loan, usually 5 to 7 years, that features a fixed interest rate, and a final large balloon payment for balance of the mortgage.

(mortgage term) Short-term loan, usually at a fixed interest rate, paid back in equal monthly payments, with a large, final “balloon” payment for the balance.

A mortgage loan with a final payment that is larger than the required periodic payments because the loan amount was not full amortized.

A mortgage that has a fixed rate, level monthly payments that amortizes over a certain term, with the unpaid balance due as a lump sum on the balloon maturity date.

Mortgage Insurance

# In Life and Health Insurance, a policy covering a mortgagor from which the benefits are intended (1) to pay off the balance due on a mortgage upon the death of the insured, or (2) to meet the payments on a mortgage as they fall due in the case of his death or disability. Also called Mortgage Redemption Insurance.

# Insurance purchased to protect the lender against loss from the borrower being unable to make payments on the mortgage loan

# A policy that allows mortgage lenders to recover part of their financial losses if a borrower fails to fully re-pay a loan. Mortgage insurance makes it possible to buy a home with as little as 5% down.

# Insurance for the lender in the event that the borrower defaults on the loan. The cost for mortgage insurance is usually built into the monthly payment made to the lender, and is typically required when the loan has an LTV of 80% or greater (when the down payment is less than 20% of the home's value). This can also be called private mortgage insurance for conventional loans, because a private institution rather than the federal government backs them.

# Insurance that covers the lender against some of the losses incurred as a result of a default on a home loan. Often mistakenly referred to as PMI, which is actually the name of one of the larger mortgage insurers. Mortgage insurance is usually required in one form or another on all loans that have a loan-to-value higher than eighty percent. Mortgages above 80% LTV that call themselves "No MI" are usually a made at a higher interest rate. ...

# Life insurance on the borrower which will pay the mortgage loan off in the event of the borrower’s demise.

# a policy that protects lenders against some or most of the losses that can occur when a borrower defaults on a mortgage loan; mortgage insurance is required primarily for borrowers with a down payment of less than 20% of the home's purchase price.

# An insurance plan that protects the lender if the borrower does not repay a loan. Mortgage insurance is required when a home buyer makes less than a 20% down payment at the time of purchase. Private mortgage insurance (PMI) covers conventional (fixed-year, fixed-rate) loans. The Federal Housing Administration charges a mortgage insurance premium (MIP) on FHA loans.

# Insurance written by an independent mortgage insurance company protecting the mortgage lender against loss incurred by a mortgage default. Usually required for loans with an LTV of 80.01% or higher.

# Insurance designed to cover the lender should the borrower default on the loan. Depending on the mortgage, this may be required by the lender.

# Insurance purchased by the borrower to insure the lender or the government against loss should you default. MIP, or Mortgage Insurance Premium, is paid on government-insured loans (FHA or VA loans) regardless of your LTV (loan-to-value). Should you pay off a government-insured loan in advance of maturity, you may be entitled to a small refund of MIP. PMI, or Private Mortgage Insurance, is paid on those loans which are not government-insured and whose LTV is greater than 80%. ...

# Money paid to insure the mortgage when the down payment is less than 20 percent. See private mortgage insurance,

# A policy that insures the lender against the borrower defaulting on a loan. Most lenders generally require insurance when borrowing more than 80% of the property value. The premium is paid by the borrower.

# Insurance that protects mortgage lenders against loss in the event of default by the borrower. This allows lenders to make loans with lower down payments. The federal government offers MI through HUD/FHA; private entities offer MI for conventional loans.

# A policy that provides protection for the lender in case of default and or which guarantees repayment of the loan if the borrower becomes disabled or dies.

# A contract that insures the lender against loss caused by a mortgagor's default on a government mortgage or conventional mortgage. Mortgage insurance can be issued by a private company or by a government agency such as the Federal Housing Administration (FHA). Depending on the type of mortgage insurance, the insurance may cover a percentage of or virtually all of the mortgage loan. See private mortgage insurance.

# A policy of insurance which promises to pay out the amount owing in the event that the borrower defaults.

# Insurance that protects lenders against loss if a borrower defaults. This is required when the loan-to-value ratio is greater than 80 percent.

# Insurance required for loans with a loan above 80.01%.

# A type of insurance charged by most lenders to offset the risk of your loan when your down payment is less than 20% of the value of the home.

# Insurance written by an independent mortgage insurance company protecting the mortgage lender against loss incurred by a mortgage default, thus enabling the lender to lend a higher percentage of the sale price.

# Insurance required if your down payment is less than 20 percent. You pay a fee for this insurance, which protects the lender should you default on house payments.

# Distinct from mortgage life insurance or home, property, fire and casualty insurance; mortgage insurance provides protection to the lender in the event of a default by the borrower.

# Government-backed or private-backed insurance protecting the lender against the borrower's default on high-ratio (and other types of) mortgages.

# in some cases lenders may require you to purchase an insurance police that will protect them in the event that the borrower defaults on it's loan. You might want to compare your mortgage insurance with a high quality term life insurance.

Mortgage Broker

# An individual or company that for a fee acts as an intermediary between borrowers and lenders.

# a firm that originates and processes loans for a number of lenders.

# A broker arranges financing for borrowers with a variety of lenders. A mortgage broker does not make the loan, but receives payments for its services.

# As do mortgage bankers, takes loan application and processes the necessary paperwork. Unlike a mortgage banker, brokers do not fund the loan with their own money, but work on behalf of several investors, such as mortgage bankers, S and L's, banks, or investment bankers.

# A company that receives payment from a lender for matching the lender with borrowers who meet the lender's criteria.

# One who, for a fee, brings together a borrower and a lender.

# One who, for a fee, brings together a borrower and lender, and handles the necessary applications for the borrower to obtain a loan against real property by giving a mortgage or deed of trust as security. Also called a loan broker.

# An individual or company that obtains mortgages for others by finding lending institutions, insurance companies or private sources to lend the money. The mortgage broker may also handle collections and disbursements.

# A middleman who serves to bring borrowers together with lenders. Offers the service of doing the shopping for the borrower while often collecting a fee from the chosen lender rather than from the borrower.

# A company that for a fee matches borrowers with lenders.

# An individual who is in the business of assisting in the arranging of funding for clients with lenders. The broker does not loan the money directly.

# A person or company having contacts with financial institutions or individuals wishing to invest in mortgages. The mortgagor pays the broker a fee for arranging the mortgage. Appraisal and legal services may or may not be included in the fee.

# An individual or company that brings borrowers and lenders together for the purpose of loan origination. Mortgage brokers typically require a fee or a commission for their services.

# a firm or individual who brings the borrower and lender together, receiving a commission if a sale results.

# A broker who represents numerous lenders and helps consumers find affordable mortgages, the broker charges a fee only if the consumer finds a loan.

# (mortgage term) Independent, third party broker who arranges transactions between borrowers and lenders by streamlining the application and approval process and finding favorable terms for the buyer.

# A person who matches buyers with lenders.

# A person who brings the borrowers and lenders together and in return is paid a fee for doing so. Some lenders do not deal directly with borrowers, they only go through mortgage brokers.

# a qualified person who buys wholesale mortgages from lenders and mark their price up to sale them to buyers that prefer to get professional help rather than shop around by themselves.

# A person or company that buys and sells mortgages for another on commission or who arranges for and negotiates mortgage contracts.

# Person or firm who functions as intermediary between borrower and lender in securing loans, or places loans with investors.

# An individual or firm that matches borrowers with lenders but does not originate or service mortgages. Brokers, who work with a variety of financiers, are charged with finding the best deal for the borrower.

# Trained professionals with a wealth of knowledge and experience to find the mortgage that best suits your needs, at the best rate available, from a large selection of lenders that include most major banks, trust companies, credit unions. A mortgage broker works for you, not for the lender. Many financial institutions pay finders fees to mortgage brokers who refer business to them making it possible for you to get the best mortgage product at no cost to you.

# A person or organisation offering to organise or broker loans from a group of lenders.

# A company that for a fee matches borrowers with lenders. Mortgage insurance premium (MIP). The fee paid by a borrower to FHA or private mortgage insurer for mortgage insurance.

# A mortgage broker, sometimes called a loan officer is a licensed professional who gathers and processes paperwork associated with mortgaging real estate. A loan officer acts as the conduit between buyer and lender.

Second Mortgage

# A mortgage, the lien of which is subordinate to that of another mortgage.

# A second loan placed upon a piece of property.

# A mortgage ranking in priority immediately below a first mortgage.

# A mortgage that has rights that are subordinate to the rights of the first mortgage holder.

# A mortgage made inferior to the first mortgage and is always subordinate to the first mortgage.

# A mortgage that has a lien position subordinate to the first mortgage.

# A loan that is junior to a primary or first mortgage and often has a higher interest rate and a shorter term.

# A second financing arrangement, in addition to the first mortgage, also secured by the property. Second mortgages are usually issued at a higher interest rate and for a shorter term than the first mortgage.

# An additional mortgage on a property that already has a mortgage.

# This is usually at a higher interest rate and represents the difference between the price of the house and first mortgage plus the down payment. This may be obtained from banks and finance companies or through lawyers or notaries.

# An additional mortgage on a property. It often carries a shorter term and a higher interest rate than the original mortgage.

# A mortgage made subsequent to another mortgage and subordinate to the first one.

# A mortgage that, on the sale of a property, is paid off only when the first mortgage is paid.

# Loans where residential property is used as the collateral. There is already an existing first mortgage, or the second mortgage is done in tandem with the first mortgage.

# The second lien on a property that is used to secure a loan.

# A mortgage which ranks after a first mortgage in priority. Properties may have two, three, or more mortgages, deeds of trust, or land contracts, as liens at the same time. Legal priority would determine whether they are called a first, second, third, etc. lien.

# An additional mortgage on a property that already has a registered mortgage. If the borrower defaults and the property is sold, the second mortgage is paid after the first. BACK TO TOP

# A subordinate mortgage made in addition to a first mortgage. Secondary Mortgage Market - The market into which primary mortgage lenders sell the mortgages to obtain funds to originate more new loans. Includes investors like Fannie Mae and Freddie Mac.

# A type of additional financing on top of your existing mortgage. This second mortgage usually is applied at a higher rate of interest and is negotiated for a shorter term

# The second-priority claim against a property in the event that the borrower defaults on the loan. A riskier form of lending since the lender who holds the second mortgage gets paid only after the lender holding the first mortgage is paid.

# Junior mortgage or junior lien; an additional loan imposed on property with a first mortgage. Generally at a higher interest rate and with shorter terms than a "first" mortgage.

# A mortgage on the same property, that is in a second position (or subordinate to) the original first mortgage.

# A second loan on real estate that already has a mortgage. It is subordinate to the first mortgage. Usually of shorter term and often at higher interest rate.

# A mortgage that has rights that are subordinate to the rights of the first mortgage holder. Security - The collateral offered by a debtor to a lender to secure a loan. For instance, the security behind a mortgage loan is the real estate being purchased with the proceeds of the loan. If the debt is not repaid, the lender may seize the security and resell it. ...

# One which takes rank immediately after a first mortgage on the same property, without any intervening liens, and is next entitled to satisfaction out of the proceeds of the property.

# a mortgage that is subordinate to a first mortgage

# A secured loan (or mortgage) that is subordinate to another loan against the same property. More specifically, the second loan in sequence.

First Mortgage

# A mortgage that is registered first against the property. This mortgage has to be paid first in the event of sale or default.

# A real estate mortgage that has priority over all other mortgages on a specified piece of real estate.

# A mortgage which is in first lien, taking priority over all other liens. In case of a foreclosure, the first mortgage will be repaid before any other mortgages.

# The mortgage that is in first place among any loans recorded against a property. Usually refers to the date in which loans are recorded, but there are exceptions.

# A mortgage which is in first lien position, taking priority over all other liens (which are financial encumbrances).

# The mortgage that has first claim in the event of default.

# A mortgage that is the primary lien against a property.

# A mortgage that is the primary lien against a property and has priority over any subsequently recorded mortgages in the event that the borrow defaults on the loan.

# a mortgage that creates a lien against real property with the lien having first priority against other claims in the event of foreclosure. Also called a senior mortgage.

# A mortgage on property that is superior in right to any other mortgage.

# The mortgage that has first claim (or "lien") in the event of a default.

# The first security registered on a property. Additional mortgages secured against the property are termed 'secondary'.

# A legal document pledging collateral for a loan that has first priority over all other claims against the property except taxes and bonded indebtedness.

# A real estate loan that creates a primary lien against real property.

# A mortgage that, when registered, is first in line on the property, giving the lender superior right to the proceeds of the sale of the property over other, later claimants.

# The original loan taken out to purchase a home.

# The mortgage that is in the first lien position. This means that should the property be foreclosed (or more typically when the property is sold), the first lien gets paid before any other liens. See also second mortgage.

# The primary mortgage on a property. When the property is sold, the lender who issued the first mortgage is paid first.

# A mortgage having priority over all other voluntary liens on a specific property.

# A mortgage recorded in first place on a property and having priority over all other mortgages that follow.

# The primary lien against a property. Fixed Rate - An interest rate that is fixed for the term of the loan.

# The primary home loan on a property, which has priority over all other claims to the title.

# A mortgage on property creating a prior claim over any subsequent mortgages or charges and usually conveying the legal estate to the mortgagee. Upon foreclosure of the mortgage, the first mortgagee must be fully satisfied out of the proceeds before any subsequent claims.

# Mortgage given first priority at the Registry/Land Titles Office. Can be conventional or high ratio. They give you the best rate of interest.

# is the loan which has first claim on a property.

# a mortgage that has priority over all mortgages and liens except those imposed by law

Mortgage

# put up as security or collateral
# a conditional conveyance of property as security for the repayment of a loan

# A mortgage (Law French for "dead pledge") is a device used to create a lien on real estate by contract. It is used as a method by which individuals or businesses can buy residential or commercial property without paying the full value upfront. The borrower (also called the mortgagor) uses a mortgage to pledge real property to the lender (also called the mortgagee) as security against the debt (also called hypothecation) for the rest of the value of the property. ...

# Debt instrument by which the borrower (mortgagor) gives the lender (mortgagee) a lien on property as security for the repayment of a loan.

# The pledge of a property to the lender as security for payment of a debt.

# A written pledge of property that is used as security for the repayment of a loan.

# a loan to purchase a home, where the property is used to guarantee repayment of the loan.

# A legal document by which real property is pledged as security for the repayment of a loan; the pledge is canceled when the debt is paid in full.

# a lien on the property that secures the Promise to repay a loan.

# A loan for a house. Also referred to as a lien or claim against real property.

# Legal agreement on the terms and conditions of a loan for the purpose of buying real estate. (A Mortgagee lends the money to a mortgagor, the borrower).

# A pledge of real estate as security for the payment of a debt.

# A document signed by a borrower when a home loan is made that gives the lender a right to take possession of the property if the borrower fails to pay off the loan.

# Usually a short-term fixed-rate loan which involves small payments for a certain period of time and one large payment for the remaining amount of the principal at a time specified in the contract.

# A legal document pledging property as security for the payment of a loan.

# A contract in which a borrower's property is pledged as security for a loan which is to be repaid on an installment basis.

# A legal document that pledges a property to the lender as security for payment of a debt.

# A conditional pledge of property to a creditor as security for the payment of a debt.

# A legal document that uses property as collateral to secure payment of a debt.

# A lien placed by the lender on the borrower's property and removed when the note has been paid in full. If the borrower defaults on the note, the lender can sell the property to satisfy the debt.

# A conditional transfer or pledge of real estate as security for payment of the debt. Also, the document creating a mortgage lien.

# An instrument giving legal title to secure the repayment of a loan made by the mortgagee (lender). In legal contemplation there are two types: (1) title theory - operates as a transfer of the legal title of the property to the mortgagee, and (2) lien theory - creates a lien upon the property in favor of the mortgagee.

# Document which specifies a specific amount of money, which is to be used for purchase of a home, using the property as collateral, whereupon a lien is placed on the property as security for repayment of the debt.

# a document placing conditions on the sale of property; usually recorded at the county level.

# An instrument used to encumber land as security for a debt.

# An instrument recognized by law by which property is hypothecated to secure the payment of a debt or obligation; a procedure for foreclosure in event of default is established by statute.

# An instrument by which property is hypothecated to secure the payment of a debt.

# A legal document that pledges property to a lender as security for the repayment of the loan. The term also is used to refer to the loan itself.

Unsecured Loan

# A loan made with no collateral posted to ensure repayment. Variable cost. A cost that varies directly with sales, such as raw materials, labor and sales commissions.

# Any loan that is not backed by collateral.

# A loan granted based only on the borrower's promise to repay.

# An advance of money that is not secured by collateral.

# A loan in air, with no asset pledged as collateral or security for it.

# An unsecured loan is bank credit extended without collateral.

# A loan for which there is no collateral required. The loan is backed up only by the promise of the borrower to repay.

# An unsecured loan is not backed by collateral, and hence represents greater risk to the lender. The lender may require a co-signer on the loan to reduce their risk. If you default on the loan, the co-signer will be held responsible for repayment. Most educational loans are unsecured loans. In the case of federal student loans, the federal government guarantees repayment of the loans. Other examples of unsecured loans include credit card charges and personal lines of credit.

# Type of arrangement in which borrower has no form of backing or collateral to put forth in exchange for the money he | she is borrowing.

# A loan that is not secured by collateral. Most credit cards are unsecured loans. Since there is no collateral offered, the rate is typically higher to compensate the lender for the greater risk being assumed.

# A debt that isn't backed by collateral.

# A loan in which there is no collateral, this type of loan is based upon personal credit.

# A loan that does not require the user to put up collateral such as a home or auto. • top

# A loan that is not secured against property. The lender therefore has no entitlement to any of the borrower's assets in the event of the borrower failing to make the loan repayments. Such a loan normally carries a higher interest rate than a secured loan

# A loan made without the benefit of a pledge of collateral.

# a loan made without any guarantee that the lender will be repaid.

Personal Loan

# An unsecured loan usually made for the purpose of debt consolidation, vacation or the purchase of durable goods. Also called a signature loan.


# A loan based on a consumer's income, debt and credit history. Principal The outstanding balance of a loan, exclusive of interest and other charges.


# A loan for personal use that is not backed by collateral, such as a home or automobile. This is neither a business loan nor a home equity or mortgage loan.


# A loan made for personal, family, or household use as opposed to a business-type loan or a long-term mortgage loan to finance real estate.


# A loan secured by property other than real estate, or unsecured.


# A personal loan is a way of borrowing money from a bank, building society or other financial service provider. You can usually borrow up to £15,000 for a period that can range from six months to 10 years. Generally speaking, the more you borrow, the lower the interest, but rates vary from around 8% to 20%, so you should shop around.


# A personal loan is the generic term for a loan. It can either be secured against your property or unsecured depending on your personal circumstances and preferences.


# A personal loan is a loan from a lender that is not secured by any property.


# A loan for Individual persons on fixed repayments and interest rates are fixed.


# a loan that establishes consumer credit that is granted for personal use; usually unsecured and based on the borrower's integrity and ability to pay

Secured Loan

# A loan backed by collateral.

# A loan in which a borrower pledges an asset such as a home or car that may be sold if the borrower is unable to repay the loan.


# A loan that is backed by collateral.


# A secured loan is a borrower's obligation that includes the pledging of some form of collateral to protect the lender in case of default.


# A loan on which some asset is pledged as collateral to ensure payment of the loan.


# Borrowed money that is backed by collateral.


# A loan that is backed by collateral. If the borrower defaults, the lender can sell the collateral to satisfy the debt.


# A secured loan is backed by collateral. If you fail to repay the loan, the lender may seize the collateral and sell it to repay the loan. Auto loans and home mortgages are examples of secured loans. Educational loans are generally not secured.


# A loan designed for the homeowner that allows them to use the value in their property as security. This type of loan can usually be used for any purpose.


# A loan that is secured by collateral. Security Assets or personal property pledged as collateral to secure a loan. Security Interest An interest in property that secures performance of a credit obligation. Service Contract These are contracts that provide financial coverage to repair or replace any failure or breakdown within the limits of the policy. Simple Interest A method of calculating interest due by applying a periodic rate to the outstanding balance on a daily basis. ...


# A loan which is secured by a mortgage over your property.


# Type of arrangement in which borrower has some form of backing ie, collateral equal in value to the amount of money he | she is borrowing.


# A loan whose re-payment is guaranteed by the pledging of a piece of collateral.


# A loan where the borrower offers an asset to which the lender has access in the event of the borrower failing to make the loan repayments. - this asset is usually your home.


# A loan for which the creditor's interest is protected by requiring the borrower to pledge collateral of some kind. The collateral can be any marketable asset.


# When the loan is secured on an asset, (such as property) to guarantee payment of the loan.

Z

Zoning Ordinances
The acts of an authorized local government establishing building codes, and setting forth.

Y

Yield
Ratio of income from an investment to the total cost of the investment over a given period of time.

X

no terms exist

W

Waive
To knowingly abandon, relinquish or surrender a right, benefit or claim.

Waiver of Lien
One who supplies labor or materials, such as a contractor, who holds legal claim to the value of those materials until paid in full. If such person executes a waiver of lien, the claim is surrendered against the property, and coincidentally, the right to enforce payment through it.

Warranty
A legal, binding statement in which one party gives another party certain assurances regarding the property being sold, usually upon which the latter party can rely upon.

Warranty Deed
A deed used in many states to convey good fee simple title to real property.

Will
A legal document that specifies how assets will be distributed upon death.

Wrap-Around Mortgage
A refinancing technique involving the creation of a second mortgage, which includes the balance due on any existing mortgages, plus the amount of the new secondary or junior lien.

V

VA Mortgage
A mortgage, of which only Veteran's are eligible, where the lender receives a guarantee to reduce loss from the Veteran's Administration (VA). The major advantage of a VA mortgage is that the required down payment is very low, and maximum allowable loan amounts are higher than on FHA loans.

Variable Interest Rate
An interest rate that changes up or down on a set schedule based on an economic index such as the prime rate.

Variable-Rate Mortgage
A long-term mortgage loan in which the interest rate may vary or float periodically throughout the term of the loan. The fluctuations are generally based on an interest rate index and are restricted under the terms of the mortgage.

Vendor
The person who transfers property by sale. Another word for "seller". Commonly used in land contract sales.

Verification of Deposit (VOD)
A document signed by the borrower's bank or other financial institution verifying the account balance and history.

Verification of Employment (VOE)
A document signed by the borrower's employer verifying his/her employment. Some investor's will accept a VOE verbally from an employer.

Verification of Mortgage (VOM) or Mortgage Verification
A form sent to a potential investor or lender that provides a loan summary which includes payments made and detailed loan statistics and information.

Voluntary Conveyance
A transfer of title to real property, usually from a delinquent mortgagor to the mortgagee, given voluntarily to satisfy the balance due on a defaulted loan and to avoid foreclosure proceedings.

U

Umbrella Liability
Coverage Supplemental liability insurance, providing increased protection against lawsuits or other losses for which you are legally responsible.

Underwriting
The process of verifying data and approving a loan. In mortgage lending, the process of approving or denying a loan based on an evaluation of the property and the applicant's creditworthiness and ability to repay the loan. The underwriter analyzes all the information provided and determines the risks involved.

Unearned Income
Income derived from investments and other sources not related to employment.

Unencumbered
Free of liens and other encumbrances. Free and clear.

Unmarketable Title
Not saleable. A title which has serious defects.

Unrecorded Deed
A document that transfers title from the grantor to the grantee without recording( e.g. providing public notice).

Unsecured Debt
Debt, such as most credit cards, that is not secured with collateral.

Unsecured Loan
A loan based on your promise to pay without savings or other collateral as a guarantee; sometimes called a signature loan.

U

Umbrella Liability
Coverage Supplemental liability insurance, providing increased protection against lawsuits or other losses for which you are legally responsible.

Underwriting
The process of verifying data and approving a loan. In mortgage lending, the process of approving or denying a loan based on an evaluation of the property and the applicant's creditworthiness and ability to repay the loan. The underwriter analyzes all the information provided and determines the risks involved.

Unearned Income
Income derived from investments and other sources not related to employment.

Unencumbered
Free of liens and other encumbrances. Free and clear.

Unmarketable Title
Not saleable. A title which has serious defects.

Unrecorded Deed
A document that transfers title from the grantor to the grantee without recording( e.g. providing public notice).

Unsecured Debt
Debt, such as most credit cards, that is not secured with collateral.

Unsecured Loan
A loan based on your promise to pay without savings or other collateral as a guarantee; sometimes called a signature loan.

T

Tax
As applied to real estate, an enforced charge imposed on persons, property or income, to be used to support the State. The governing body in turn utilizes the funds in the best interest of the general public.

Tax Deferred
An investment with earnings and/or contributions that are taxed at a later date.

Tax Lien
A claim against real estate for the amount of its unpaid taxes.

Tax Sale
Public sale of property at an auction by a government authority as a result of nonpayment of taxes.

Tenancy by the Entirety
Joint ownership of a property by husband and wife. Ownership is passed to the surviving spouse, known as the right of survivorship.

Tenancy in Common
Co-ownership of a property by two or more people where each tenant has an equal interest and equal rights to the property. If one party dies, ownership can be passed to the remaining owner(s) via inheritance.

Tenant-stockholder
The obligee for a cooperative share loan, who is both a stockholder in a cooperative corporation and a tenant of the unit under a proprietary lease or occupancy agreement.

Third Party Fees
Fees collected by lender for services provided by other companies, such as an appraiser.

Third-Party Origination
A process by which a lender uses another party to completely or partially originate, process, underwrite, close, fund, or package the home loan.

Title
A legal document evidencing property ownership or a right of ownership.

Title Company
A company that specializes in examining and insuring titles to real estate.

Title Insurance
Insurance that protects the policyholder against loss arising from disputes or claims regarding ownership of a property.

Title Search
An examination of the pertinent title records to ensure that the seller is the legal owner of a property, and that there are no liens or other claims pending against the property.

Total Debt Ratio
Total monthly debt plus housing payments divided by your gross monthly income.

Trade equity
Equity that results from a property purchaser giving his or her existing property (or an asset other than real estate) as trade as all or part of the down payment for the property that is being purchased.

Transaction Fee
A fee charged each time the borrower draws on the credit line.

Transfer of Ownership
Any means by which the ownership of a property changes hands. Lenders consider all of the following situations to be a transfer of ownership: the purchase of a property "subject to" the mortgage, the assumption of the mortgage debt by the property purchaser, and any exchange of possession of the property under a land sales contract or any other land trust device.

Transfer Tax
State or local tax payable when title to a property passes from one owner to another.

Treasury Index
An index that is used to determine interest rate changes for certain adjustable-rate mortgage (ARM) plans. It is based on the results of auctions that the U.S. Treasury holds for its Treasury bills and securities or is derived from the U.S. Treasury's daily yield curve, which is based on the closing market bid yields on actively traded Treasury securities in the over-the-counter market.

Trustee
An individual or organization that is given legal responsibility to manage assets in the best interest of, or for, the benefit of another.

Truth-in-Lending
A federal law that requires lenders to fully disclose, in writing, the terms and conditions of credit, such as a mortgage, including the annual percentage rate (APR) and other charges.

S

Sale-Leaseback
A technique in which a seller deeds property to a buyer for a consideration, and the buyer simultaneously leases the property back to the seller.

Sales Agreement
A written contract signed by the buyer and the seller of a house stating the terms and conditions under which the property will be sold.

Sales Contract
A written agreement between competent parties stating all terms and conditions of a sale.

Satisfaction of Mortgage
A legal document, usually recorded, that proves that the borrower completely paid off the mortgage. It is given to the borrower by the lender.

Seasoned Loan
A loan that has been closed and on a lender's books for at least 12 months.

Seasoning
A specified time period you must have a second mortgage before you can refinance.

Secondary Financing
Loans secured by the property, but subordinated to the first mortgage.

Secondary Mortgage Market
An informal market where lenders and investors buy and sell existing mortgages. Government-sponsored entities and private investors buy mortgages from lenders who use the proceeds to make additional loans.

Second Home
A property occupied part-time by a person in addition to his or her primary residence.

Second Mortgage
The second-priority claim against a property in the event that the borrower defaults on the loan. A riskier form of lending since the lender who holds the second mortgage gets paid only after the lender holding the first mortgage is paid.

Secured Debt
A debt on which collateral has been pledged by the borrower. The creditor can institute a foreclosure or repossession, or take the property identified by the lien, called the collateral, to satisfy the debt if you default.

Secured Loan
A loan that is backed by collateral. If the borrower defaults, the lender can sell the collateral to satisfy the debt.

Security
The collateral or property given, deposited or pledged to ensure the fulfillment of an obligation or payment of a debt.

Security Instrument
A recorded legal document given by the borrower to the lender. It pledges the title of the property as insurance to the lender for the full payment of the mortgage. Mortgages, deeds of trust and deeds to secure debt are considered security instruments. The security instrument contains the description of the property.

Security Interest
The legal right or share that the mortgage lender holds to the property.

Seller Carry Back
An agreement in which the owner of a property provides financing, often in combination with an assumed mortgage.

Seller Take-Back
An agreement in which the owner of a property provides financing, often in combination with an assumable mortgage.

Servicer
An organization that collects principal and interest payments from borrowers and manages borrowers' tax and insurance escrow accounts. A mortgage banker is often paid a fee to service mortgages that have been purchased by an investor in the secondary mortgage market.

Servicing
Term used to describe the administration of mortgage loans between the time of loan disbursement and the time the loan is fully paid off. This includes collecting monthly payments from the borrower, maintaining records of loan progress, assuring payments of taxes and insurance, and pursuing delinquent accounts.

Servicing Costs
The expenses incurred by the seller/servicer in servicing loans, including money spent on staff, computer facilities, foreclosure costs, etc.

Servicing Fee
The monthly fee retained by the loan servicer according to the terms of a servicing agreement.

Settlement
The process of finalizing the sale of property that includes the transfer of title from the seller to the buyer.

Settlement Statement
The complete breakdown of costs involved in the real estate transaction for both the seller and buyer.

Single Family Residence
A residential structure designed to include one dwelling.

Sold Loan
A mortgage loan that has been sold to another institution or investor. Sold loans may continue to be serviced by the seller.

Special Assessments
A special tax imposed on property, individual lots or all property in the immediate area, for road construction, sidewalks, sewers, streetlights, etc.

Special Deposit Account
An account that is established for rehabilitation mortgages to hold the funds needed for the rehabilitation work so they can be disbursed from time to time as particular portions of the work are completed.

Special Lien
A lien that binds a specified piece of property, unlike a general lien, which is levied against all one's assets. It creates a right to retain something of value belonging to another person as compensation for labor, material, or money expended in that person's behalf.

Special Warranty Deed
A deed in which the grantor conveys title to the grantee and agrees to protect the grantee against title defects or claims asserted by the grantor and those persons whose right to assert a claim against the title arose during the period the grantor held title to the property. In a special warranty deed the grantor guarantees to the grantee that he has done nothing during the time he held title to the property which has, or which might in the future, impair the grantee's title.

Specific Performance
If the buyer backs out of a contract the deller has the right to keep his deposit and also go after the buyer for "Specific Performance." Ie: Make him buy the property or sue him for any amount the Seller may have lost because the Buyer did not complete the contract.

Stand Alone
A Home Equity loan originated without obtaining a Countrywide first mortgage at the same time.

Standby Commitment
A commitment to purchase a loan or loans with specified terms, both parties understanding that delivery is not guaranteed. The commitment is issued for a fee, with willingness to fund in the event that a permanent loan is not obtained. Such commitments are typically used to enable the borrower to obtain construction financing at a lower cost on the assumption that permanent financing of the project will be available on more favorable terms when the improvements are complete and the project generates income.

Standard Mortgage
A type of mortgage loan that carries a fixed interest rate and has fixed monthly payments over the life of the loan. Traditionally, the most common type of conventional mortgage loan.

Stated Loan
A mortgage product available to borrowers who do not wish to prove their income. It is usually designed for self-employed borrowers or borrowers that would rather state their income rather than submit proof of income.

Straight-Term Mortgage
A mortgage loan granted for a fixed term of years, with the entire loan becoming due and payable at the end of that time.

Strict Foreclosure
A legal proceeding in which the lending institution brings court action against the borrower. The court sets a date by which the borrower must redeem his debt in full or title will pass automatically to the lender without public sale.

Subject Property
The property that is the subject of an appraisal.

Subdivision
A housing development that is created by dividing a tract of land into individual lots for sale or lease.

Subordinate Financing
Any mortgage or other lien that has a priority that is lower than that of the first mortgage. The subordinate loan has a claim to payment in a foreclosure only after the first mortgage is paid.

Subordinate Lien
A lien by which an encumbrance is made subject to or junior to the original lien.

Subordination Clause
A clause which permits the placing of a mortgage at a later date which takes priority over an existing mortgage.

Sub-Prime
A sub-prime loan is any loan in which the borrower has challenges in obtaining mortgage financing because of poor credit, hard to document income or assets, or any unique situation that would prevent them from obtaining funding through "conforming" lenders.

Subsidized Second Mortgage
An alternative financing option known as the Community Seconds® mortgage for low- and moderate-income households. An investor purchases a first mortgage that has a subsidized second mortgage behind it. The second mortgage may be issued by a state, county, or local housing agency, foundation, or nonprofit corporation. Payment on the second mortgage is often deferred and carries a very low interest rate (or no interest rate). Part or all of the second mortgage debt may be forgiven depending on how long the buyer remains in the home.

Survey
A measurement of land, prepared by a registered land surveyor, showing the location of the land with reference to known points, its dimensions and the location and dimensions of any improvements.

Sweat Equity
Equity created in a property by the performance of work or labor by the purchaser or borrower.

R

Rate and Term Refinance
The borrower replaces a mortgage loan on the subject property with another mortgage loan for the purpose of getting a better interest rate and loan term.

Rate Lock
A commitment issued by a lender to a borrower guaranteeing a specified interest rate for a specified period of time.

Rate Reduction Option
A fixed-rate mortgage that includes a provision that gives the borrower an option to reduce the interest rate (without refinancing) at a later date. It is similar to a prearranged refinancing agreement, except that it does not require re-qualifying.

Real Estate Agent
A person licensed to negotiate and transact the sale of real estate on behalf of the property owner.

Real Estate Broker
A middleman or agent who buys and sells real estate for a company, firm, or individual on a commission basis. The broker does not have title to the property, but generally represents the owner.

Real Estate Investment Trust (REIT)
A corporation or trust that uses money from many investors to purchase and manage property for the purpose of making money. REITS are often publicly held.

Real-Estate Owned
A term used by lending institutions that refers to ownership of real property acquired for investment or as a result of foreclosure.

Real Estate Settlement Procedures Act (RESPA)
A consumer protection law that, among other things, requires advance disclosure of settlement costs to home buyers and sellers, prohibits certain types of referral and other fees, sets rules for escrow accounts, and requires notice to borrowers when servicing of a home loan is transferred.

Real Property
Another term for real estate. It includes land and things permanently attached to the land, such as trees, buildings, and stationary mobile homes. Anything that is not real property is termed personal property.

Realtor
Anyone who is licenses to both buy and sell real estate in an area and who is an active member in the local real estate board affiliated with the National Association of Realtors.

Recorder
The public official who keeps records of transactions that affect real property in the area.

Recording
The noting in a book of public record of the terms of a legal document affecting title to real property, such as a deed, a mortgage note, a satisfaction of mortgage, or an extension of mortgage.

Recording Fees
Fees that the lender charges for officially recording the signed mortgage documents to make them a public record.

Redemption Period
The time period in a foreclosure in which a borrower in default cannot be divested of legal title or evicted and can exercise the right to redeem the property by paying the debt in full.

Reduced Documentation
A method used to determine income when qualifying a borrower(s) for a loan. Borrower(s) provide their income, however no verification documentation is typically required.

Refinancing
Paying off one loan with the proceeds from another loan.

Rehabilitation Mortgage
A mortgage created to cover the costs of repairing, improving, and sometimes acquiring an existing property.

Remaining Balance
The amount of principal that has not yet been repaid.

Remaining Term
The original amortization term minus the number of payments that have been applied.

Rent with Option to Buy
A financing option that allows a potential home buyer to lease a property with the option to buy. Often constructed so the monthly rent payment covers the owner's first mortgage payment, plus an additional amount as a savings deposit to accumulate cash for a downpayment. A seller may agree to a lease-purchase option if the housing market is saturated and the seller is having difficulty selling the property.

Repayment Plan
An arrangement made to repay delinquent installments or advances. Lenders' formal repayment plans.

Replacement Cost Coverage
Homeowner's insurance that pays the cost to replace or repair the insured home or possessions, up to the policy's set maximum. Provides more protection than actual cash value coverage.

Replacement reserve fund
A fund set aside for replacement of common property in a condominium, PUD, or cooperative project - particularly that which has a short life expectancy, such as carpeting, furniture, etc.

Request for Notice of Default
A recorded document that obligates the holder of the first mortgage lien to notify subordinate lien holders in the event of default by the borrower.

Rescind
To avoid or cancel in such a way as to treat the contract or other object of the rescission as if it never existed.

Rescission
The act of cancellation or annulment of a transaction or contract by the operation of a law. Borrowers usually have the option to cancel certain credit transactions, including a refinance or home equity transaction, within three business days after consummation.

Restrictive Covenants
Private restrictions limiting the use of real property. Restrictive covenants are created by deed and may "run with the land," binding all subsequent purchasers of the land, or may be "personal" and binding only between the original seller and buyer.

Return on Investment (ROI)
A measure of a corporation's profitability; generally, the income an investment provides in a year.

Reverse Mortgage
An equity loan that allows a homeowner to receive tax-free payments on a monthly basis up to the credit limit, which is based on equity in the home.

Revolving Line of Credit
An agreement to lend a specific amount to a borrower, and to allow that amount to be borrowed again once it has been repaid. Most credit cards offer revolving credit.

Rider
A provision added to an insurance policy to add, amend, or alter the original coverage.

Right of First Refusal
A provision in an agreement that requires the owner of a property to give another party the first opportunity to purchase or lease the property before he or she offers it for sale or lease to others.

Right of Ingress or Egress
The right to enter or leave designated premises.

Right of Survivorship
In joint tenancy, the right of survivors to acquire the interest of a deceased joint tenant.

Risk
The degree of uncertainty regarding the rate of return on and/or the principal value of an investment.

Q

Qualifying Ratios
The ratio of your fixed monthly expenses to your gross monthly income, used to determine how much you could afford to borrow.

Quitclaim Deed
A deed that transfers whatever interest or title a grantor may have, without warranty.

Quote
Specifies the interest rate and any fees in a mortgage deal.

P

Partial Payment
In loan collection, a loan payment that is less than the amount due under the terms of the mortgage note. Usually, it will not be credited to the account until the balance of the amount due is paid.

Payment Adjustment Period
The length of time (typically a year) between changes to the borrower's P&I (Principal & Interest) payment.

Payment Buy down
Payment buy downs occur when a third party, typically a builder, pays part of the initial P&I payments for a year or two, so that the borrower has smaller payments and can qualify for the loan.

Payment Cap
A limit on the amount the payment can be changed at the end of each Payment Adjustment Period.

Payment Discount
In a payment discount, the lender reduces the first year's interest rate to make the mortgagor more attractive to borrowers.

Penalty Rate
Several percentage points higher than a credit card’s current annual percentage rate, which goes into effect after a predetermined number of late payments.

Periodic Payment Cap
A provision of an adjustable-rate mortgage (ARM) that limits how much the interest rate or loan payments may increase or decrease.

Periodic Rate
The interest rate described in relation to a specific amount of time. The monthly periodic rate, for example, is the cost of credit per month. The daily periodic rate is the cost of credit per day.

Permanent Financing
A mortgage loan, usually covering development costs, interim loans, construction loans, financing expenses, and marketing, administrative, legal and other costs. This loan differs from a construction loan in that the financing goes into place after the project is constructed and open for occupancy. It is a long-term obligation, generally for a period of 10 years or more.

Personal Loan
A loan secured by property other than real estate, or unsecured.

Personal property
Any property that is not real property.

Piggyback
A combination of two loans. Example: A loan is made for 90% of the home price. 80% of the purchase price is supplied by a 1st mortgage and 10% by a 2nd mortgage. The 2nd mortgage is piggybacked on the 1st.

PITI
Shorthand for principal, interest, taxes, and insurance, which are the components of a monthly mortgage payment.

PITI Ratio
Compares the amount of the monthly income to the amount the borrower will owe each month in principal, interest, real estate tax and insurance on a mortgage. It is used by lenders in deciding whether to give the borrower a loan.

PITI Reserves
A cash amount that a borrower must have on hand after making a down payment and paying all closing costs for the purchase of a home. The principal, interest, taxes, and insurance (PITI) reserves must equal the amount that the borrower would have to pay for PITI for a predefined number of months.

Plaintiff
The person who institutes a suit in a court.

Planned Unit Development (PUD)
A project that may consist of any combination of one- to four-family homes, condominiums and other styles of residential housing. The individual unit and often the real estate under it are owned by the individual owner. The common facilities are owned and maintained by a homeowner's association.

Plat
A map or chart of a lot, subdivision or community drawn by a surveyor showing boundary lines, buildings, improvements on the land, and easements.

Points
Points are finance charges paid at the beginning of a mortgage in addition to monthly interest. One point equals one percent of the loan amount.

Policyholder
A policyholder is a person who pays a premium to an insurance company in exchange for the protection detailed in an insurance policy.

Portfolio
The securities or investments owned by an individual.

Power of Attorney
A legal document that allows someone to appoint an attorney in fact to conduct personal and financial business, even in the event of legal incompetence. It expires upon the giver's death.

Pre-Approval
A process used to assess a prospective borrower’s ability to pay back a loan. It determines how much money a prospective homebuyer can borrow before an actual application is made.

Prearranged Refinancing Agreement
A formal or informal arrangement between a lender and a borrower where the lender agrees to offer special terms (such as a reduction in the rate or closing costs) for a future refinancing as an inducement for the borrower to enter into the original mortgage transaction.

Preforeclosure Sale
A procedure in which the investor allows a mortgagor to avoid foreclosure by selling the property, typically for less than the amount that is owed to the lender.

Premium
The fee you pay for insurance, usually a recurring expense paid at fixed intervals.

Prepaid Interest
Interest that the borrower pays the lender before it becomes due.

Prepayment
A loan repayment made in advance of its contractual due date.

Prepayment Penalty
A charge imposed by the lender if a borrower pays off a loan early. The charge is usually expressed as a percent of the loan balance at the time of the prepayment.

Prequalification
A process used to assess a prospective borrower’s ability to pay back a loan. It determines how much money a prospective homebuyer can borrow before an actual application is made.

Previous Balance
An interest calculation method used by some credit card issuers where finance charges are based on the amount owed at the end of the previous billing cycle.

Primary Residence
The place someone lives most of the time.

Prime Rate
The interest rate banks use to price loans to their best or "prime" customers. Many institutions quote prime rates established by large money center commercial banks.

Principal
The original or remaining amount of money invested or lent, not including profits or interest earned or due on that money.

Principal Payment
Portion of your monthly payment that reduces the remaining balance of a home loan.

Principle Balance
Amount borrowed, which may increase as a result of interest capitalization, and the amount on which interest is calculated.

Private Mortgage Insurance (PMI)
An insurance policy paid by borrowers designed to protect lenders against default for loans over 80 percent Loan-to-value ratios.

Processing
Gathering the loan application and all of the required supporting documents (including the property appraisal, credit report, credit history, and income and expenses) so that a lender can consider the borrower for a loan.

Probate
The process of distributing a deceased person's estate.

Promissory Note
A document in which the borrower promises to pay a stated amount on a specific date. The note normally states the name of the lender, the terms for payment and any interest rate.

Property Appraisal
A supportable estimate of a property’s market value determined by a trained and certified appraiser who measures the likelihood that a property will maintain its value over the duration of the loan.

Prorate
To divide expenses and income between a buyer and a seller in proportionate shares.

Public Auction
A meeting in an announced public location to sell property to repay a mortgage that is in default.

Purchase Money
Refers to a loan for the purpose of purchasing a home, rather than a loan refinance or home improvement loan

O

Offer to Purchase
A document completed by a home buyer specifying the terms and conditions under which real estate will be purchased.

One-year Adjustable
Mortgage whose annual rate changes yearly. The rate is usually based on movements of a published index plus a specified margin, chosen by the lender.

Open-end Credit
A line of credit that may be used over and over again, including credit cards, overdraft credit accounts, and home equity lines.

Open-end Lease
A lease that may involve a balloon payment based on the value of the property when it is returned.

Open-End Mortgage
A mortgage with a provision that the outstanding loan amount may be increased upon mutual agreement of the lender and the borrower.

Original Principal Balance
The total amount of principal owed on a mortgage before any payments are made.

Origination
The process whereby the lender, or a servicing agent on behalf of the lender, handles the initial application processing and disbursement of loan proceeds.

Origination Fee
Fee, payable by the borrower and deducted from the principal of a loan prior to disbursement to the borrower. For federally-backed loans, the origination fee is paid to the federal government to offset the cost of the interest subsidy to borrowers. For private loan programs, the origination fee is generally paid to the originator to cover the cost of administering and insuring the program.

Owner Financing
A property purchase transaction in which the property seller provides all or part of the financing and takes back a security instrument.

Owner-Occupied Property
The borrower or a member of the immediate family lives in the property as a primary residence.

Owner of Record
The individual named on a deed that has been recorded at the county recorders office.

N

Negative Amortization
An increase in a mortgage loan balance that occurs when the monthly payment is too small to cover the principal and interest due. The amount of the shortfall is added to the remaining balance to be repaid later.

Negotiable Instrument
A written document that represents an unconditional promise to pay a specified amount of money upon the demand of its owner. Examples include checks and promissory notes. Negotiable instruments can be transferred from one person to another, as when you write "pay to the order of" on the back of a check and turn it over to someone else.

Net Cash Flow
The remaining income left after the collection of rent and payment of property expenses, including the mortgage, taxes, insurance and maintenance.

Net Effective Income
Gross income less federal income tax.

Net Income
This is income after taxes, deductions, and allowances have been subtracted

Net Worth
The difference between a person’s assets and liabilities.

No Cash-Out Refinance
The mortgage amount is limited to the sum of the unpaid principal balance of any existing first mortgage(s) and closing costs.

No Closing Cost Loan
A loan in which the fees the borrower(s) are not required to pay cash out-of-pocket at closing for the normal closing costs. The lender typically includes the closing costs in the principal balance or charges a higher interest rate than for a loan with closing costs to cover the advance of closing costs.

No-Documentation Loans or NO-DOC
NO-DOC means No verification of income or even job. Rates will vary depending on LTV and credit scores.

No Income Check Loan
This program is designed for the entrepreneur or self-employed that choose not to have their income revealed or just have difficulty proving their income. The rate tends to be higher on a No Income Check Loan.

Non-Dischargeable Debts
Debts that cannot be erased through bankruptcy. Examples of non-dischargeable debts include alimony, child support, many student loans, and most income tax debts.

Non-Liquid Asset
An asset that cannot easily be converted into cash.

Non-Owner-Occupied Property
Property purchased by a borrower not for a primary residence but as an investment with the intent of generating rental income, tax benefits and profitable resale.

Non-Profit Corporation
A business entity formed for civil, social, or charitable purposes for which the generation of profit is not part of its function. Non-profit corporations are taxed differently, and are incorporated differently than for-profit business organizations.

Note
A written promise by one party to pay a specified sum of money to a second party under conditions agreed upon mutually.

Note Rate
The interest rate on the mortgage loan.

Notice of Default (NOD)
A notice recorded after the occurrence of a default under a deed of trust or mortgage. Typically required by an interest third party that has insured or guaranteed the loan.

M

Margin
In an adjustable rate mortgage, the amount added to the interest rate index, to calculate the new indexed interest rate. Also, borrowing money from a broker to purchase securities.

Marketable Title
A title that is free and clear of objectionable liens, clouds, or other title defects. A title which enables an owner to sell his property freely to others and which others will accept without objection.

Market Timing
Shifting money in and out of investment markets in an effort to take advantage of rising prices and avoid downturns.

Market Value
The price at which buyers are willing to buy and sellers are willing to sell.

Master Association
A homeowners' association in a large condominium or planned unit development (PUD) project that is made up of representatives from associations covering specific areas within the project.

Maturity
The date a debt is due for payment.

Maximum Financing
The maximum amount a lender will lend on a specific loan program.

Maximum Rate
The maximum interest rate that can accrue on a variable rate loan

Mechanic's Lien
A claim created by law for the purpose of securing priority payment for work performed and material furnished by a mechanic or other person who has done construction or repair of a building. Such a claim attaches to the land as well as buildings and improvements erected on land.

Merged Credit Report
A credit report that contains information from more than one credit reporting agency. When the report is created, the information is compared for inconsistencies and duplicate entries. Any duplicates are combined to provide a summary of a your credit.

Minimum Credit
This field on the Microsurf tables refers to the minimum credit rating a borrower must have in order to qualify for the listed loan.

Misrepresentation
Information that is provided to and is relied upon by a third party as fact, but that is untrue and material to the risk assumed. The information may be provided with the knowledge that it is untrue and with the intent to deceive, or provided as the truth without knowing for a fact that it is not true.

Modification
The act of changing any of the terms of the mortgage.

Monthly Debt
A borrower's monthly expenses including credit cards, installment loans, student loan payments, alimony and child support and housing payment expense.

Monthly Housing Expense
Total principal, interest, taxes, and insurance paid by the borrower on a monthly basis. Used with gross income to determine affordability.

Monthly Mortgage Insurance (MI) Payment
Portion of monthly payment that covers the cost of Private Mortgage Insurance.

Monthly Payment
The monthly amount of principal and interest collected by mortgage lenders. May also include taxes and insurance.

Monthly Periodic Rate
The interest rate factor used to calculate the interest charges on a monthly basis. The factor equals the annual percentage rate divided by 12.

Monthly Principal & Interest (P&I) Payment
Portion of monthly payment that covers the principal and interest due on the loan.

Monthly Taxes & Insurance (T&I) Payment
Portion of monthly payment that funds the escrow or impound account for taxes and insurance.

Mortgage
A loan secured by real estate, where the borrower allows the lender a lien on the property as security until the loan is repaid

Mortgage Banker
A company that originates, sells and services mortgages exclusively for resale in the secondary mortgage market.

Mortgage Broker
An individual or company that brings borrowers and lenders together for the purpose of loan origination. Unlike a mortgage banker, brokers do not fund the loan but work on behalf of several lenders. Brokers typically require a fee or a commission for their services.

Mortgage Commitment
An agreement between the borrower and the lender to disburse a mortgage loan at a future date if specified terms and conditions are satisfied.

Mortgagee
The institution, group or individual that lends money on the security of pledged real estate; the association, the lender.

Mortgage Guaranty Insurance
Insurance written by an independent mortgage guaranty insurance company that protects the mortgage lender against loss incurred by a mortgage default, thus enabling the lender to lend a higher percentage of the sales price. The federal government writes this form of insurance through the Federal Housing Administration (FHA) and the Veterans Administration (VA).

Mortgage Guaranty Insurance Premium
The amount paid by a mortgage for mortgage guaranty insurance either to the FHA or a private mortgage guaranty insurance company.

Mortgage Insurance
Insurance that protects the lender against loss in the event a mortgage borrower defaults. Also called private mortgage insurance.

Mortgage Lender
A classification used to describe those institutions or organizations at least partially engaged in the primary mortgage market – that is, extending funds directly to the borrower.

Mortgage Note
A written promise to pay a sum of money at a state interest rate during a specified term. It is usually secured by a mortgage.

Mortgage Verification (VOM)
A form sent by lenders to verify the balance and repayment history of borrowers for mortgage application.

Mortgagor
The borrower in a mortgage agreement.

Multi-Dwelling Units
Properties that provide separate housing units for more than one family, although they secure only a single mortgage. Typically a 2-4 unit property.

Multifamily Mortgage
A dwelling that contains more than four units (an apartment building).

Multiple Borrowers
Two or more borrowers who are not husband and wife.